Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Stock Code: 200771 Stock ID: Hangqilun B Announcement No. 2018-62
Hangzhou Steam Turbine Co., Ltd.
SEMIANNUAL REPORT 2018
（Stock Code：200771）
August 2018
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Important Remarks, Table of Contents, and Definitions
The Board of Directors, the Supervisory Committee, the directors, the supervisors, and executives of the
Company guarantee that there are no significant omissions, fictitious or misleading statements carried in the
Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness of
the Report.
Chairman Mr. Zheng Bin, Chief Financial Officer Zhao Jiamao, and the Chief of Accounting Department Mr. Jin
Chan hereby declare: the Financial Statement in the report is guaranteed to be truthful and complete.
All of the directors attended the board meeting on which this report was examined.
This Report contains prospective descriptions, which doesn’t constitute substantial commitment to investors.
Investors are requested to be aware of the risks attached to their investment decisions.
The Company will not distribute cash dividend or bonus shares, neither capitalizing of common reserves for the
report period.
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Table of Contents
I. Important Notice, Table of contents and Definitions
II. Corporate Profile and Key Financial Indicators
III. Business Profile
IV. Performance Discussion and Analysis
V. Important Events
VI. Change of share capital and shareholding of Principal Shareholders
VII. Situation of the Preferred Shares
VIII. Information about Directors, Supervisors and Senior Executives
IX. Corporate Bonds
X. Financial Report
XI. Documents available for inspection
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Definition
Terms to be defined Defined as Definition
Company, the Company Defined as Hangzhou Steam Turbine Co., Ltd.
The Group, Hangqi Group Defined as Hangzhou Steam Turbine Power Group Co., Ltd.
The report period, In the report period Defined as January 1,2018-June 30,2018
Hangzhou Zhongneng Steam Turbine Power Co., Ltd. – the holding
Zhongneng Co. Defined as
subsidiary of the Company
Hangzhou Steam Turbine Casting Co., Ltd. – the holding subsidiary
Casting Co. Defined as
of the Company
Zhejiang Steam Turbine Packaged Technology Development Co.,
Packaged Tech. Co. Defined as
Ltd. – the holding subsidiary of the Company
Hangzhou Steam Turbine Machinery Equipment Co., Ltd. - the
Machinery Co. Defined as
holding subsidiary of the Company
Hangzhou Steam Turbine Auxiliary Machinery Co., Ltd. - the
Auxiliary Machine Co. Defined as
holding subsidiary of the Company
Zhejiang Turbine Import & Export Co., Ltd. – the holding subsidiary
Turbine Co. Defined as
of the Company
Hangzhou Steam Turbine Heavy Industry Co., Ltd. - the holding
Heavy Industry Co. Defined as
subsidiary of the Company
The Board of Directors Defined as The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
The Supervisory Committee Defined as The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
The Shareholders’ Meeting Defined as The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
RMB, RMB0’000, RMB000’000’000 Defined as RMB Yuan, RMB10 thousand Yuan, RMB100 million Yuan
MW Defined as Unit of power: 1000KW
PLM Defined as Product life circle management information system
MES Defined as Manufacturing execution system
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
II. Corporate Profile and Key Financial Indicators
1. Company Information
Stock ID Hangqilun B Stock Code 200771
Stock Exchange Listed Shenzhen Stock Exchange
Company Name in Chinese 杭州汽轮机股份有限公司
Short form of Company Name in Chinese 杭汽轮
Name in English(if any) HANGZHOU STEAM TURBINE CO.,LTD
Abbreviation in English(if any) HTC
Legal representative: Zheng Bin
2. Contact person and contact manner
Secretary of the Board Representative of Stock Affairs
Name Wang Gang Wang Caihua
Address No. 357 Shiqiao Rd. Hangzhou No. 357 Shiqiao Rd. Hangzhou
Tel. 0571-85780198 0571-85780438
Fax. 0571-85780433 0571-85780433
Email. wg@htc.cn wangch@htc.cn
III. Other info.
1. Contacts
No change to the registered address, office address, postal code, official website, and email address of the
Company. For details please find the Annual Report 2017.
2. Information inquiry
None of the official presses, website, and place of enquiry has been changed in the semi report period. For details
please find the Annual Report 2017.
IV. Summary of Accounting Data and Financial Index
Are there any retrospective adjustment or restatement of financial information of previous year due to change of
accounting policies or correcting of accounting errors?
No
This report term Same period last year Increase/decrease (%)
Turnover (yuan) 2,284,130,982.13 1,663,724,702.26 37.29%
Net profit attributable to shareholders of the
128,510,594.01 43,995,804.38 192.10%
listed company (yuan)
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Net profit attributable to the shareholders of the
listed company and after deducting of 89,470,726.72 3,560,218.39 2,413.07%
non-recurring gain/loss(yuan)
Net Cash flow generated by business operation
557,787,190.73 -10,310,355.58 5,509.97%
(yuan)
Basic earnings per share (Yuan/share) 0.17 0.06 183.33%
Diluted earnings per share (Yuan/share) 0.17 0.06 183.33%
Net income on asset, weighted 2.18% 0.69% 1.49%
As at the end of the
As at the end of last year YoY+/-（%）
reporting period
Gross assets (yuan) 11,365,517,688.31 10,830,597,182.38 4.94%
Shareholders’ equity attributable to shareholders
5,902,112,559.27 5,884,816,809.55 0.29%
of the listed company（yuan）
V.The differences between domestic and international accounting standards
1. Differences between the net profit and net asset in the financial reports prepared under IAS and Chinese
Accounting Standard
Not existent
2. Differences between the net profit and net asset in the financial reports prepared under IAS and Chinese
Accounting Standard
Not existent
VI. Non-recurring gain/loss items and amounts
In RMB
Items Amount Remarks
Non-current asset disposal gain/loss(including the write-off part for
-3,031.08
which assets impairment provision is made)
Govemment subsidies recognized in current gain and loss(excluding
those closely related to the Company’s business and granted under the 20,337,694.45
state’s policies)
Gains and losses from change of fair values of held-for-transaction
financial assets and financial liabilities except for the effective hedge
business related to normal business of the Company, and investment 25,716,189.31
income from disposal of transactional financial assets and liabilities and
financial assets available for sale
Other non-operating income and expenditure beside for the above items 1,602,373.71
Less: Influenced amount of income tax 7,271,797.15
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Amount of influence of minority interests（After tax） 1,341,561.95
Total 39,039,867.29 --
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses and
its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure
for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as
recurring gains and losses, it is necessary to explain the reason.
None of Non-recurring gain /loss items recorgnized as recurring gain /loss/items as defined by the information
disclosure explanatory Announcement No.1- Non –recurring gain/loss in the report period.
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
III. Business Profile
Ⅰ.Main Business the Company is Engaged in During the Report Period
Whether the company needs to comply with the disclosure requirements of the particular industry
No\
As the leading provider of turbo machinery equipment and relevant service in China, our company is mainly
famous for designing and producing rotating turbo machinery like industrial steam turbines and gas turbines. Our
company, one of the major companies drafting the industrial standard in Chinese domestic industry of industrial
steam turbine, has developed into the biggest base to research, develop and produce industrial steam turbines in
China and ranks first among industrial steam turbine producers in terms of the market occupancy. Holding the
principle “our products should be based on clients’ demands” as our business mode and characteristic, our
company designs and produces in accordance with every client’s personal demands so as to meet personalized
needs in engineering projects to the utmost. To realize the fast research and development of our products, our
company has adopted the advanced modular design technique and, on the other hand, introduces information
technique to assist the collaborative production to achieve the resource saving and flexible production. In addition,
our company also provides our clients with relevant service such as engineering programs, general engineering
contracting, operation and maintenance of our products as well as remote control and so on.
Industrial steam turbines use the steam featuring high temperature and high pressure as their working
medium so as to convert the thermal energy into mechanical energy to drive various industrial equipments through
the rotating steam turbines. As for different objects driven by industrial steam turbines, the steam turbines could
be divided into industrial driving steam turbines and industrial power-generation steam turbines. Mainly driving
rotating machines like compressors, air blowers, pumps and squeezers, industrial driving steam turbines, as the
core power part in numerous large-scale industrial equipments, are always introduced into some industries like oil
refining, chemical engineering, chemical fertilizer, building materials, metallurgy, electric power, light industry
and environmental production. The industrial power-generation steam turbines, mainly utilized to drive electric
generators and provide thermal energy, are mainly adopted in private stations, regional projects of combined heat
and power generation, power generation by recycling waste heat in industrial production, urban waster power
plants and gas-steam combined cyclepower stations in various industrial sectors. The gas turbines produced by our
company are mainly used by metallurgical industry to recycle the waste heat from the blast furnace exhaust to
generate power.
In the gas turbine business, the Company has cooperated with Siemens on the advanced natural gas turbine
SGT-800 model-with features of high efficiency, high reliability and low emission, thus to enter the distributed
natural gas field. As the general whole-set maker of SGT-800 in China, the company has launched the gas turbine
business in respect of the project procurement and the integrated implementation. Hangzhou Steam Turbine has
the type selection ability for the distributed energy combined cycle project, has established a complete system of
supporting standard and material system, and it can complete the independent processing or matching work for the
equipment besides the gas turbine body. In the industrial fields including the cogeneration /combined cycle power
plant and the oil & gas project with distributed energy projects that adopt the small and medium gas turbines, the
Company not only can provide gas turbine equipment for customers, but also can provide customers with
complete sets of equipment for gas turbine power plant and the efficient integrated solutions. Especially, it can
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
provide customers with operational support services throughout the product life, and this service model is
conductive for the establishment of long-term business cooperation relationships between the company and its
customers.
As the major producer of industrial equipments in China during the report period, our company is mainly
benefited from the following factors in terms of the elements driving our business performance:
1. On the basis of market demands. The relevant market demands fluctuate differently due to various business
condition and investment cycles in different industrial fields. The company further made more specified positions
toward the market for the products, implemented the differentiated marketing strategy, and integrated the business
sectors and tapped into the potential. During the reporting period, the domestic oil refining and chemical
investment projects started at multiple points and drove the demand for related equipment manufacturing. The
company grasped the growth opportunities in the petrochemical sector, and formulated the flexible price strategies
for the fields of low-end and mid-end drive, ensured the market share and continuously consolidated and
strengthened the existing market advantages. Adhering to the "Go global" strategy, the Company continued to
expand the overseas markets, establish overseas offices and increase its market influence.
2. Innovation and further reform in difficult areas of product technology.
Our company continuously improves product technical performance and tackles hard issues in the scientific
researches of product structure, core parts, basic design, manufacturing technology, material technology, etc. In
addition, basing on clients’ demands, our company launches the study “The Demonstration and Application
Project for Packaging Technology of Steam Turbine” to push forward the intelligence of our products and the
development of the integration technology. Meantime, the company cooperated with universities, scientific
research institutes to build the technological exchange and cooperation platform.
3. Upgrading and transformation of industrial structure transformation.
The company jointed with Siemens to enter the distributed energy market and enhance the development and
utilization of natural gas distributed energy. In the industrial fields including the cogeneration /combined cycle
power plant and the oil & gas project with distributed energy projects that adopt the small and medium gas
turbines, the Company not only can provide gas turbine equipment for customers, but also can provide customers
with complete sets of equipment for gas turbine power plant and the efficient integrated solutions.
4. Brand and market position. The company’s products have a good reputation and extensive brand influence
in the domestic market, The company has maintained a leading market share in the domestic industrial drive. The
company's products have a high reputation and brand influence in the domestic market.
5.Cost controlling level. As domestic labor costs continue to rise and the price of industrial products continue to
decline, the product profitability is facing a severe test. In recent years, the company continuously improves the
level of costs controlling by improving the organizational structure, optimizing business processes, enhancing the
supply chain controlling, strengthening risk management, raising the efficiency of all the staff and so on.
6.Emphasis on quality engineering and services: promote the key project management, meticulously plan key
projects, implement dynamic quality supervision; attach importance to products’ after-sales service market,
integrate existing resources to increase after-sales service initiative, extend product value chain, and promote the
company’s transformation from manufacturing to service.
I. Major Changes in Main Assets
1.Major Changes in Main Assets
Main assets Major changes
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Mainly due to Hangzhou Jushi Investment Partnership (Limited Partnership) investment
Equity assets project settlement and the company's investment shareholding in Hangzhou Bank's stock
price fluctuations
Fixed assets No major changes
Intangible assets No major changes
Mainly caused by the new investment at the current period which resulted from the
Construction in progress parent company’s scientific research building and from the promotion of the progress of
steam turbine project
2. Main Conditions of Overseas Assets
Not applicable
II. Analysis On core Competitiveness
Whether the company needs to comply with the disclosure requirements of the particular industry
No
1. A complete technical innovation system was established. The Company has under its possession of national,
provincial, and municipal grade technical centers, a doctorial workstation, and an academician workstation. Close
co-operations were carried out with institutions and universities from throughout the country. As the main drafter
of national standard on industrial steam turbine, the Company has the newest technical trend under its close
observation. The Company is now providing nearly 600 different models of steam turbines to the customers and
hold the newest technical system covering the product lines up to 150 MW. Cooperating with SIEMENS in the
field of gas turbine, our company has been capable of selecting the model of the combined recycling project of
distributed energy. In addition, our company has also been able to finish the independent processing or supporting
work which doesn’t need to depend on the gas turbine machine.
Secondly ,The advantages of solutions. The modular design of industrial steam turbine and the production pattern
featuring parallelization production enable our company to give considerations to the cost, date of delivery and
clients’ demands in the process of production in accordance with clients’ personalized designs, thereby making our
company capable of advancing with the development trend of individual requirements. Our company has always
been devoting to the localization in terms of the gas turbine business so as to achieve the localized one-stop
service step by step including the sale, production, installation, debugging, operation, training and after-sale
service. Our company has always been striving to provide clients with the complete equipment of gas turbine
power station and the efficient total solutions.
Thirdly, the Company has established strategic co-operations with main customers in the country. Further
marketing approaches were carried on by involving itself in the customers’ value. A sound and steady image has
been set up in the domestic steam turbine market. In the global market, the Company has acquired multiple
important certifications and has established a primary global recognition.
Fourthly, the Company has its complete service providing system. The Company is not only capable to provide
onsite 24-hour service for the Company’s own products, but also accumulated rich experiences in technical
maintenance and reengineering of other manufacturers’ products.
Fifthly, the Company has cultivated a significant advantage in human resources. Great importance has been
attached to construction of work teams with collection of high-end workforce in the areas of research &
development, At the same time, our company values the cooperation with universities. “Zhejiang Technical
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Association for Gas Turbines in Equipment Manufacturing Industry” was officially founded jointly by our
company and Zhejiang University and other scientific research institutions to build a new platform for integration
of production and research in terms of gas turbine technology.The Company has cultivated a significant advantage
in human resources. Great importance has been attached to construction of work teams with collection of high-end
workforce in the areas of research & development, designing, technique, testing, and quality control. An excellent
workforce provides a sound foundation to lift quality and services.
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
IV. Performance Discussion and Analysis
1.General
During the reporting period, the Company focused on the annual economic work policy of “Continuous
Innovation, Synergistic Promotion, Cultural Leading, and Profound Management”, increased the investment in
product research and development, and continuously promoted the technological innovation; with aiming at the
advantageous product areas, it had consolidated the market shares of high-quality orders; orderly carried out the
relocation work and successful completed the production plan; deepened the promotion of key management work
and improved the construction of risk management system; pooled up the talent people, refined the core values of
the company, and well implemented the effective management activities，In the first half of 2018, the Company
has realized turnover of RMB 2,284,130,982.13 , a increase of 37.29%; total profit of RMB192,348,021.36, a
increase of 190.30%, Net profit of RMB160,370,149.54, a increase of 168.50%, Of which the net profit
attributable to owners of the parent company of RMB128,510,594.01. a increase of 192.10%, The main reason for
the large year-on-year increase in net profit attributable to shareholders of the listed company was that the increase
in delivery units in the first half of the year and the large proportion of towing units that led to an increase in sales
revenue and a corresponding increase in corporate profits. In the first half of the year, the company received 149
new sets/1.927 billion-yuan orders, an increase of 6% over the same period last year.
Progress of the Company's business plan during the reporting period
(1) Technological innovation guided development
During the reporting period, the company successfully completed the development of new products for major
projects such as Dalian Hengli, Zhejiang Petrochemical and Zhongkong Solar. It had completed the
self-developed new leaf type "Turbine cascade air blow test", and spared no efforts to develop the complete set
design technology of the steam-electric double-drive four-in-one large-scale power station boiler induced draft fan
project, and promoted the market use of the new straight type blade and improved the high-efficiency condensing
power generation series of twisted blades. In the first half of the year, the company obtained 2 invention patents
and 4 utility model patents, and applied for 9 new utility model patents and 8 invention patents.
The Dalian Hengli 1.5 million tons/year ethylene plant steam turbine unit undertaken by the company is the
largest ethylene project in the world. The Shenhua Ning Coal domestically-developed 100,000 m3/h air separation
unit passed the technical appraisal, and the four steam extraction back-pressure units of Binhai Thermal Power
were put into operation, marking that the company's technical capabilities in research, development and
manufacturing of major power equipment has gained the broad recognition.
The company participated in the revision of the national standard "Gas Turbine Quality Control Code" and "Gas
Turbine Noise", and the "Key Technology Development and Application of 1000MW Grade Power Plant Boiler
Feed Water Pump Steam Turbine" won the first prize of Zhejiang Science and Technology Progress Award,
"Zhejiang Hangzhou Steam Turbine Gas Turbine Machinery Innovation Center” was successfully registered in the
Civil Affairs Department of Zhejiang Province, highlighting the company's advanced position in the product
technology field.
The company's MES system was officially launched, and the quality big data platform was initially established.
The research conclusion work of the "Discrete Intelligent Manufacturing Model Research and Digital Workshop
Construction" and "PLM System Research and Implementation (Phase II)" were successfully completed, and the
pilot use of the remote monitoring system for steam turbine products was promoted and applied, which showed
that the company well fitted the development trend of “smart manufacturing” and did hard work to realize the
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
transformation of service-oriented manufacturing enterprises.
(2) Precision marketing to stay ahead
During the reporting period, in view of the sustained and moderate growth of domestic oil refining, the
concentrated outbreak of ethylene projects in the chemical field especially many million-ton grade projects and
the bouncing-back market sign of the chemical industry business, the company had implemented the precision
marketing strategy and used the company's product advantages to consolidate the market share of petrochemical
industry, obtained the orders of Sinochem Quanzhou million-ton ethylene project, Yanchang petroleum petro-gas
plant, Dalian Hengli 1.5 million tons ethylene project and Yantai Wanhua 1 million tons ethylene plant and so on.
In the coal chemical sector, the company mainly undertook orders for projects including the 76,000 m3/h air
separation project of Shandong Fangyu, 2.2 million tons of coal-to-methanol project of Ningxia Baofeng, and
300,000 tons of ethylene glycol project of Shaanxi Weihe River Chenzhou Chemical. In the field of gas turbine,
the company signed the SGT-800 gas turbine project of Jiangsu Huafeng Microfiber Distributed Energy Station.
Due to the country's strict control of coal-fired power and self-provided power plants, the growth rate of the
cogeneration industry had slowed down noticeably, but the order share of the company's reaction-type
back-pressure generator sets remained stable. The domestic feed pump steam turbine market was affected by
overcapacity in the power industry, the power investment slowdown and the adjustment of national energy policy,
so the orders of the company for water pump/exhaust fan turbines for large power plants had dropped sharply, but
overall, the total orders of domestic power generation business still gained some growth compared to the same
period last year.
According to the national “One Belt, One Road” initiative, the company continued to promote the
implementation of the localization strategy and continued to penetrate overseas markets such as India, Iran,
Thailand, and Russia, but as affected by geopolitical conflicts, changes in internal political and economic
situations, and trade barrier policies in the target regions, the company’s oversea orders were not in ideal situation.
(3) Promoting the relocation and guaranteeing the production
During the reporting period, the company promoted the construction of major projects as planned, and fully
prepared for the relocation work. The complete plant was planned to be put into use during the year. As of now,
the company's research building has been successfully completed and is expected to be delivered at the end of the
year. Facing with the double pressure of the historical peak of production and the company's relocation, the
company adopted rational production plans, effectively coordinated the internal and external resources,
established the production incentive mechanism, improved the interlink ability of production and sales, and
successfully completed the production plan of steam turbine products.
The company actively promoted the turbine assembly technology, and the products could be wholly shipped after
the test run was qualified, shortening the installation cycle of the products at the user site, and the company
continuously improved the company's product quality and the complete delivery rate of contracted goods, further
enhancing the company's product quality and market competitiveness.
The company's lean production pilot project passed the acceptance test. On the basis of deepening the pilot lean
production project of the rotor workshop, the company continued to promote lean production in the manufacturing
sector.
(4) Deepening the risk management and risk prevention and control
During the reporting period, the company focused on the top ten key management tasks formulated at the
beginning of the year and decomposed and implemented the key management tasks. The company strengthened
the examination and approval management of related party transactions, external guarantees, external investments,
and entrusted wealth management, gave full play to the role of the company's assigned directors, and improved
the strategic implementation and standard operation supervision and management of the holding subsidiaries. Also,
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
it cultivated the capabilities of subsidiaries to undertake business on their own, and gradually reduced the holding
subsidiaries’ dependence on the company's business, further optimized the organizational structure, improved the
enterprise management system, promoted the upgrading of the quality system documents, and integrated the
procurement and external resources to set up procurement centers.
The company combed the important business processes and promoted the "integrated management process
trial run" project. In addition, it compiled the risk management implementation plan, perfected the risk
management system of the company, strengthened the contract risk management, implemented the process
tracking management for contract execution of key projects, paid close attention to the risks regarding the
implementation progress, pre-production, delivery time and collection for goods payment. Furthermore, the
company enhanced the internal control and legal risk review before contract signing, and actively used legal
means to recover accounts receivable.
(5) Pooling up talents and refining company culture
The company attaches great importance to personnel training and construction. In order to better shape a
vigorous youthful, professional talent management team of the company, and cultivate a group of compound
reserve talents with solid professional knowledge, advanced management experience and excellent management
ability, the company establishes a reserve management talent pool and provides training and development
platform for the talents. The company has formed an effective incentive mechanism for the construction of a talent
team. Also, the company has established a skill master studio, and by means of selected chief technicians and
professional skills leaders, organizing labor skill competitions and other means to build a “craftsman” team that
meets the company's development requirements.
The company continues to practice the core values of “creating value for customers, creating happiness for
employees, creating wealth for shareholders, and creating prosperity for society”. Taking the 20th anniversary of
the listing as the opportunity, the company held the “20th Anniversary Commemoration and Investor Reception
Day” event to introduce investors to the company's market and technology status, and invited investors to visit the
company to showcase the company's new look. The company actively promoted the construction of special
steam-turbine culture brands such as “Shinning Turbine Staff” and used the corporate culture to drive the
industrial mission to realize the dream of globalization of the company's industrial turbine business.
2.Main business analysis
Refer to relevant contents of “1.Summarization” in “Discussion and Analysis of Management”.
Changes in the financial data
In RMB
YOY change
This report period Same period last year Cause change
（%）
Mainly due to the increase in sales revenue from
Turnover 2,284,130,982.13 1,663,724,702.26 37.29%
the company's key projects in the current period.
Mainly due to the increase in sales revenue from
Operating cost 1,612,116,152.26 1,192,385,051.48 35.20%
the company's key projects in the current period.
Sale expenses 77,008,302.22 81,874,015.85 -5.94%
Administrative expenses 388,805,621.19 354,411,777.81 9.70%
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Mainly due to the increase in interest income and
Financial expenses 3,177.07 7,945,244.29 -99.96%
the decrease in exchange losses during the period
Mainly due to the increase in income tax expenses
Income tax expenses 31,977,871.82 6,528,367.57 389.83%
payable in the current period
R & D Investment 151,349,561.03 140,500,456.42 7.72%
Cash flow generated by Mainly due to the increase in cash received from
557,787,190.73 -10,310,355.58 5,509.97%
business operation, net sales of goods during the period
Mainly due to the net purchase of wealth
Net cash flow generated
-509,012,778.80 158,091,370.23 -421.97% management products and the increase in
by investment
long-term asset purchases and acquisitions
Net cash flow generated
-30,496,335.59 -29,043,280.80 -5.00%
by financing
Net increasing of cash and Mainly due to the decrease in net cash flow from
17,761,752.63 115,611,816.42 -84.64%
cash equivalents investment activities during the period
Mainly due to further improve the utilization rate
Other current assets 1,332,266,723.15 904,426,265.79 47.31% of funds and increase the purchase amount of
wealth management products in the current period.
Mainly due to the continuous advancement of
Construction in process 400,143,683.78 255,921,660.09 56.35% heavy industry projects in the current period,
increasing investment
Mainly due to the increase in unpaid value-added
Taxes payable 82,776,263.80 34,920,073.37 137.04%
tax at the end of the period
Mainly received dividends from Hangzhou Bank
in the previous period and disposed of equity
Investment income 37,144,607.44 88,988,506.53 -58.26%
interest in Hangzhou Changdi Equity Investment
Partnership (Limited Partnership)
Mainly due to the current military industry project
Other income 20,337,694.45 2,505,237.27 711.81%
to enjoy the national value-added tax relief
Mainly due to the increase in value-added tax for
Taxes and surcharges 29,819,229.04 18,736,550.58 59.15%
the current period
Significant changes in the profit structure or profit source of the Company during the reporting period
Nil
Main business composition
In RMB
Increase/decre
Increase/decrease ase of gross
Increase/decrease
of business cost profit rate
Gross profit of revenue in the
Turnover Operation cost over the same over the same
rate(%) same period of the
period of previous period of the
previous year(%)
year (%) previous year
(%)
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
On Industries
Boiler and power machine
2,041,284,977.09 1,410,487,391.44 30.90% 33.87% 32.26% 0.84%
manufacture
Nonferrous metal alloy
66,352,498.00 51,917,888.16 21.75% 62.87% 74.78% -5.33%
manufacture
Other 176,493,507.04 149,710,872.66 15.17% 79.76% 55.59% 13.17%
Subtotal 2,284,130,982.13 1,612,116,152.26 29.42% 37.29% 35.20% 1.09%
On Products
Industrial steam turbine 1,756,496,345.21 1,217,492,254.72 30.69% 50.22% 44.11% 2.94%
Casting products 66,352,498.00 51,917,888.16 21.75% 62.87% 74.78% -5.33%
Auxiliary machinery 80,710,048.93 70,149,642.15 13.08% -6.08% 0.11% -5.37%
Complete sets of waste
53,946,887.10 44,299,572.55 17.88% -14.26% -14.39% 0.12%
heat power stations
Part 150,131,695.85 78,545,922.02 47.68% -27.35% -21.29% -4.03%
Other 176,493,507.04 149,710,872.66 15.17% 79.76% 55.59% 13.17%
Subtotal 2,284,130,982.13 1,612,116,152.26 29.42% 37.29% 35.20% 1.09%
District
Domestic 2,192,030,790.17 1,543,987,039.27 29.56% 40.69% 39.22% 0.74%
Overseas 92,100,191.96 68,129,112.99 26.03% -12.82% -18.23% 4.89%
Subtotal 2,284,130,982.13 1,612,116,152.26 29.42% 37.29% 35.20% 1.09%
3.Non-core business analysis
In RMB
Proportion in total Sustainable (yes
Amount Explanation of cause
profit or no)
Mainly financial income and settlement income of
Investment income 37,144,607.44 19.31% Hangzhou Jushi Investment Partnership (Limited
Partnership)
Mainly due to the bad debt provision for accounts
Impairment of assets 43,111,352.82 22.41%
receivable
Non-operating Mainly for the income from the contract
4,189,726.48 2.18%
income compensation
Non-operating Mainly for the expenditure of the contract
2,591,154.54 1.35%
expenses compensation
16
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Mainly due to the reduction and exemption of
military project value-added tax and other
Other income 20,337,694.45 10.57%
government subsidies according to national
policies
IV.Condition of Asset and Liabilities
1.Condition of Asset Causing Significant Change
In RMB
End of Reporting period End of same period of last year Change in Reason for
As a percentage of As a percentage of percentage( significant
Amount Amount
total assets(%) total assets(%) %) change
Monetary fund 1,230,803,798.79 10.83% 1,055,809,378.48 9.50% 1.33%
Accounts
1,921,794,558.44 16.91% 1,812,297,540.52 16.31% 0.60%
receivable
Inventories 2,055,625,339.61 18.09% 2,052,667,695.99 18.47% -0.38%
Long-term equity
5,800,000.00 0.05% 0.00 0.00% 0.05%
investment
Fixed assets 540,574,836.70 4.76% 601,473,873.27 5.41% -0.65%
Construction in
400,143,683.78 3.52% 156,071,663.76 1.40% 2.12%
process
Short-term loans 140,000,000.00 1.23% 197,700,000.00 1.78% -0.55%
Long-term loans 122,800,000.00 1.08% 4,900,000.00 0.04% 1.04%
2.Asset and Liabilities Measured by Fair Value
In RMB
Profit/losson Impairment Sold
Purchase
fair value Cumulative fairvalue provided in inthis
d in this
Items Opening balance changes in changes charged to this reportin Closing balance
reportin
this reporting equity Reporting g
g period
period period period
Financial assets
3.Available-for –sale
2,239,086,521.28 -85,446,493.44 2,153,640,027.84
financial assets
Subtotal of financial
2,239,086,521.28 -85,446,493.44 2,153,640,027.84
assets
Total of the above 2,239,086,521.28 -85,446,493.44 2,153,640,027.84
17
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Financial Liabilities 0.00 0.00
Significant changes in the measurement attributes of the main assets in this Reporting Period
3. Restricted asset rights as of the end of this Reporting Period
Assets under ownership or use rights
Items End of Book value Reason
Utilized for issuing bank acceptance bill, L/C and L/G.
Monetary fund 75,549,211.33
Utilized for issuing bank acceptance bill
Note receivable 75,967,299.36
Fixed assets Utilized for guaranteeing to obtain bank loan
81,202,239.67
Invisible assets
86,913,837.86 Utilized for pledging to obtain the bank loan and guaranteeing the
investment loan for China Development Funds
Dividend receivable 6,900,000.00 Utilized for guaranteeing the investment loan for China Development
Funds
Available for salefinancial
357,098,000.00 Utilized for guaranteeing the investment loan for China Development
assets
Funds
Total 683,630,588.22
18
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
V.Investment situation
1. General
Investments made in same period of last
Investments made in the reporting period +/- %
year
16,000,000.00 20,000,000.00 -20.00%
2.Condition of Acquiring Significant Share Right Investment during the Report Period
Not applicable
3.Situation of the Significant Non-equity Investment Undergoing in the Report Period
In RMB
Reasons for not
Accrued Actual Antici Accrued Realized
Fixed Reaching the Disclo Disclo
Investment Industry involved in Investment amount in Investment Amount up Capital Projectsch pated Income up to the
Project name investments or Planned Schedule sure sure
method investment projects this reporting period to the End of Reporting Source edule incom End of Reporting date Index
not and Anticipated
Period e Period
Income
Scientific research General equipment
Self-built Yes 28,242,298.51 143,031,225.49 Self 90.00% No
building manufacturing
Turbine heavy General equipment
Self-built Yes 119,714,194.20 218,785,815.97 Self 12.19% No
industry manufacturing
Total -- -- -- 147,956,492.71 361,817,041.46 -- -- 0.00 0.00 -- -- --
4.Investment of Financial Asset
（1）Securities investment
Security Security Stock Initial investment Mode of Book value balance at Changes in fair Cumulative fair value Purcha Sale Gain/loss of the Book value Accounting Sauce of
19
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
category code Abbreviatio cost accounti the beginning of the value of the this changes in equity se amoun reporting period balance at the end items the shares
n: ng reporting period period amoun t in the of the reporting
measure t in the this period
ment this period
period
Domesti Financial
c and Hangzhou assets
600926 390,954,040.00 FVM 2,239,086,521.28 -72,629,519.42 1,498,283,089.67 0.00 0.00 0.00 2,153,640,027.84 Self funds
foreign Bank available for
stocks sale
Total 390,954,040.00 -- 2,239,086,521.28 -72,629,519.42 1,498,283,089.67 0.00 0.00 0.00 2,153,640,027.84 -- --
Disclosure Date of Announcement
on Securities Investment
Approved by the Board of
Directors
Disclosure Date of Announcement
on Securities Investment
Approved by the Shareholders
Meeting(If any)
（2）Investment in Derivatives
□ Applicable √ Not applicable
The Company had no investment in derivatives in the reporting period.
VI. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
20
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
The Company had no sales of major assets in the reporting period. VI.Significant Asset and Right Offering
2.Sales of major equity
Not applicable
Ⅶ. Analysis of the Main Share Holding Companies and Share Participating Companies
√ Applicable □ Not applicable
Situation of Main Subsidiaries and the Joint-stock Company with over 10% net profit influencing to the Company
In RMB
Leading products
Company Name Company type Registered capital Total assets Net assets Operating Income Operating profit Net Profit
and services
Zhejiang Steam Turbine Packaged Trade of packadged
Subsidiaries 51,000,000.00 253,515,047.71 86,957,248.65 103,740,083.15 10,553,222.99 8,964,799.55
Technology Development Co., Ltd. equipment
Hangzhou Zhongneng Steam Turbine
Subsidiaries Manufacturing 92,500,000.00 1,106,125,974.66 302,723,942.25 404,080,803.34 17,172,581.30 13,107,189.41
Power Co., Ltd.
Hangzhou Steam Turbine Casting Co.,
Subsidiaries Casting 22,000,000.00 570,169,907.42 179,841,898.96 217,307,955.01 13,915,420.15 11,884,986.18
Ltd.
Hangzhou Steam Turbine Machinery &
Subsidiaries Manufacturing 30,000,000.00 266,895,572.40 174,373,185.99 120,928,873.57 34,010,193.02 25,913,896.24
Equipment Co., Ltd.
Hangzhou Steam Turbine Auxiliary
Subsidiaries Manufacturing 80,000,000.00 769,026,443.74 202,745,969.90 225,615,296.83 1,540,852.81 5,792.82
Machine Co., Ltd.
Zhejiang Turbine Import & Export Co.,
Subsidiaries Commerce & trade 20,000,000.00 177,833,091.79 45,648,001.53 69,637,764.34 -39,758.06 52,991.94
Ltd.
Hangzhou Steam Turbine Heavy Industry
Subsidiaries Manufacturing 558,966,865.00 589,393,362.70 584,095,844.84 122,717,395.60 300,796.21 225,597.15
Co., Ltd.
Subsidiaries obtained or disposed in the reporting period
Not applicable
VIII．Structured vehicle controlled by the Company
Not applicable
21
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
IX. Prediction of business performance for January -September 2018
Estimation of accumulative net profit from the beginning of the year to the end of next report period to be loss probably or the warning of its material change
compared with the corresponding period of the last year and explanation of reason.
Not applicable
22
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
X.Risks facing the Company and countermeasures
1. Market risks
With the decreasing demands for domestic heavy industry investment, the turbine market demands in dive area
are under weak boost，More competition and decreasing of gross profit ratio are expectable, and will bring certain
pressure to the Company’s market share and competition. However the Company will do all its best in aspects of
technical innovation, market exploring, quality lifting, service upgrading, and value adding, to neutralize the
negative impact of the market.
2. Risks of contract fulfilling
With the aggravation of market fluctuations and during the process of contract execution, frequent changes
in the contracts, delay and pause in project progress occurred occasionally, which brought huge impacts and
influences to the Company’s internal product implementation process. Meanwhile, market fluctuations also
increased the cost and risk for fulfilling the Company’s contracts. The Company will further strengthen the
marketability and improve the speed and level of corporate response to the market to control the risk of contract
execution.
3.Account receivable risks
With declines in operation of partial downstream clients and increases in risk of investment project, risks
increased continuously in the Company’s receivables, of which the average aging tends to increase, which will
bring huge impacts to the Company’s business performance. The Company will implement customer credit
management, strengthening the contract signing and controlling the fulfillment risk to intensify the examination
for receivables and reduce the adverse effect of overdue account receivables.
4.Exchange rate risks
Increasing expanding of international purchase and international marketing entails the internal payments to
be influenced by exchange rate fluctuations. So, exchange loss will be suffered to some extent. As two-way
volatility of the RMB exchange rate is changing sharply, profit or loss on exchange becomes more uncertain. We
are attempting to refer to the fluctuation cycle of exchange rate and take appropriate risk-management tools to cut
down the loss maximally.
5.Overseas market risks
During implementation of “13th five-year strategy”, we are intending to devote major efforts to “going
global” strategy to further open up oversea targeted markets where we will gain more international market shares
and improve our influence. However, influenced by geopolitical conflict, volatile political and economic situation
and trade barriers in the overseas markets, the strategy of expanding overseas market becomes more uncertain. In
view of this, we will reinforce market investigation, validate solutions and figure out development way for the
localized business.
6. Relocation risk
The company will fully start the relocation work in 2018. The company will well unify and coordinate the
production tasks in 2018, making the holding subsidiaries and strategic cooperation units do good job in
cooperating with the relocation and construction work, and minimizing the impact of ahead-of-time of relocation
on production. Although the company will formulate the relocation safety plans, security plans and emergency
plans to avoid problems arising from such as equipment disassembly and assembly, transportation and storage of
various types of goods, turnover, the possibility of various types of personnel injuries, cargo losses and unstable
23
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
events during the relocation process still can not be totally avoid. Therefore, the company will ensure that the
work of comprehensive security, safety production, and logistics support in the process of relocation is carried out
smoothly and orderly.
24
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
V. Important Events
1. Annual General Meeting and Extraordinary Shareholders’ Meetings in the Reporting Period
1.Annual General Meeting
Investor
Meeting Type participation Convened date Disclosure date Index to disclosed information
ratio
Resolutions of the Shareholders’
Annual Annual Meeting
2017 Shareholders’
Shareholders’ 69.46% April 27,2018 April 28,2018 2017(Announcement No. 2018-36)
general meeting
General Meeting
released by
Http://www.cninfo.com.cn
Resolutions of First Provisional
First Provisional Provisional Shareholders’ general meeting of
Shareholders’ general Shareholders’ 72.34% July 20,2018 July 21,2018 2018 （ Announcement
meeting of 2018 general meeting No.2018-54 ） by by
Http://www.cninfo.com.cn
2. Preferred stockholders restored voting rights to request to convene Provisional Shareholders’ Meeting.
Not applicable
II. Proposal for profit distribution and converting capital Reserve into share actual for the
reporting period
For the reporting period, the Company plans not to distribute cash dividends or bonus shares or convert capital
reserve into share capital.
III. The fulfilled commitments in the reporting period and under-fulfillment commitments by the end of the
reporting period made by the company, shareholder, actual controller, acquirer, director, supervisor,
senior management personnel and other related parities.
Not existent
25
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
IV. Particulars about engagement and disengagement of CPAs firm
Whether the semi-annual financial report had been audited?
The semi-annual report was not audited.
V.Explanations given by board of directors and supervisory board regarding “ Modified auditor’s” Issued
by CPAs firm for the reporting period
Not applicable
VI. Explanations given by Board of Directors regarding “ Modified auditor’s Report” Issued for last year
Not applicable
VII. Bankruptcy and restructuring
No such cases in the reporting period.
VIII. Lawsuit
Signifieant lawsuits or arbitrations
□ Applicable √ Not applicable
No such cases in the reporting period.
Other legal matters
Amount
Litigation Date Index
involved Forming of Litigation (arbitration)
Basic conditions of (arbitration) of of
（Ten the predicted Litigation (arbitration) progress judgement execution
litigation (arbitration) judgement result disclos disclos
thousand debt condition
and influence ure ure
yuan ）
Prosecuted Zhejiang Dahe The court made a judgment in
Textile Printing and Dyeing April 2018: the defendant paid The company has
156.5 No Win the lawsue
Garment (Group) Co., Ltd. 1.565 million yuan and overdue applied for execution
to pay for the purchase price interest to the plaintiff.
The court made a judgment in
Cathay Paper (Tangshan
June 2018: the defendant paid The company has
Caofeidian) Co., Ltd. 5 No Win the lawsue
50,000 yuan and overdue applied for execution
returns the bid bond
interest to the plaintiff.
Cathay Paper (Inner Court hearing in July 2018, the
16.35 No Not yet judged Not yet judged
Mongolia Bidding Co., Ltd. court has not yet decided
26
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
returns the bid bond
Cathay Paper Guoxin
Indicted in April 2018, the court
Bidding Group Co., Ltd. 80 No Not yet open court Not yet open court
has not yet notified the court
returns the bid bond
IX. Punishments and rectifications
Not existent
X. Credit conditions of the Company as well as its Controlling shareholder and actual Controller
Not existent
XI.Equity incentive plans, employee stock ownership plans or other incentive measures for employees
Not existent
27
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
XII.Material related transactions
1. Related transactions in connection with daily operation
Whether
Trading limit over the
Principle of Amount of Market price
Subjects of Ratio in approved approved Index of
pricing the Way of of similar Date of
Related parties Relationship Type of trade the related Price of trade trade （ Ten information
related payment trade disclosure
transactions similar trades （ Ten limited disclosure
transactions available
thousand）
thousand） or not
(Y/N)
Hangzhou Hangfa
Generating Affiliate of the Purchase of Not
Generators Fair and just Market price 6,665.49 6,665.49 No Bank transfer
Equipment Co., Group goods
Ltd. applicable
Hangzhou Steam
Turbine Affiliate of the SteamTurbin Not
Sale goods Fair and just Market price 4,562.72 4,562.72 No Bank transfer
Engineering Co., Group e applicable
Ltd.
Total -- -- 11,228.21 -- 11,228.21 -- -- -- -- --
Details of any sales return of a large amount Nil
Give the actual situation in the report period where a forecast had
been made for the total amounts of routine related-party No more than expected
transactions by type to occur in the current period(if any)
Reason for any significant difference between the transaction price
Nil
and the market refernce price (if applicable)
28
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
2. Related-party transactions arising from asset acquisition or sold
No such cases in the reporting period.
3. Related-party transitions with joint investments
No such cases in the reporting period.
29
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
4. Debts and credits with related parties
Nil
5. Other material related transactions
1.The company and Hangzhou Steam Turbine Power Group Co., Ltd. and Shanghai Relian Steel Trading Co.,
Ltd. jointly invested Hangzhou Juyuan Asset Management Co., Ltd., signed the "Jianyuan Xinxing No.9 Private
Equity Fund" fund contract, and used its own funds to subscribe the fund-share of Jianyuan Xinxing No.9 Private
Equity Fund.
The website to disclose the interim announcements on significant related-party transactions
Date of disclosing Description of the website for disclosing
Description of provisional announcement
provisional announcement provisional announcements
(www.cninfo.com.cn)（Announcement No：
April 26,2018
Announcement on Overseas Investment Subscription Contract 2018-35）
Fund and Related Transactions (www.cninfo.com.cn)（Announcement No：
May 23,2018
2018-41）
XIII. Particulars about the non-operating occupation of funds by the Controlling shareholder and other
related parties of the Company
The company was not involved in the non-operating occupation of funds by the controlling shareholder and other
related parties during the reporting period.
XIV. Significant contracts and execution
1.Entrustments, contracting and leasing
（1）Entrustment
No such cases in the reporting period.
（2）Contracting
No such cases in the reporting period.
（3）Leasing
No such cases in the reporting period.
30
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
2.Significant guarantees
（1）Guarantees
Ten thousand
External Guarantee (Exclude controlled subsidiaries)
Relevant Compl Guarantee
Date of
disclosure Amount ete for
happening Actual
Name of the date/No. of of imple associated
(Date of mount of Guarantee type Guarantee term
Company the Guarant mentat parties
signing guarantee
guaranteed ee ion (Yes or
agreement)
amount or not no)
Hangzhou Steam Two years from the
Turbine Power October 23,2016 20,800 December 28,2016 20,800 Mortgage date of expiration of No Yes
Group Co., Ltd the principal debt
Total amount ofoutward
Total amount of outward guaranteeapproved
0 guarantee actuaily incurred 20,800
in the report period（A1）
in the report period（A2）
Total balance of actual
Total of external guarantee
20,800 external guarantee at 20,800
approved at Period-end(A3)
Period-end(A4)
Guarantee of the Company for the controlling subsidiaries
Guarant
Relevant Complet ee
Date of Actual
disclosure Amount e for
Name of the happening mount
date/No. of of Guarantee impleme associate
Company (Date o of Guarantee term
the guarante type ntation d
guaranteed signing guarante
guaranteed e or parties
agreement) e
amount not (Yes or
no)
Hangzhou
Steam Turbine Two years from the date
The joint liability
Auxiliary January 27,2018 2,000 January 29,2018 2,000 of expiration of the No No
guaranty
Machinery Co., principal debt
Ltd
Hangzhou
Two years from the date
Steam Turbine The joint liability
July 15,2017 3,000 November 16,2017 3,000 of expiration of the No No
Casting Co., guaranty
principal debt
Ltd.
Two years from the date
Hangzhou The joint liability
June 26,2018 2,000 June 29,2018 2,000 of expiration of the No No
Steam Turbine guaranty
principal debt
31
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Casting Co.,
Ltd.
Total of actual guarantee
Total of guarantee for subsidiaries
4,000 for subsidiaries in the 7,000
approved in the Period (B1)
Period (B2)
Total of actual guarantee
Total of guarantee for subsidiaries
7,000 for subsidiaries at 7,000
approved at Period-end (B3)
Period-end (B4)
Guarantee of the subsidiaries for the controlling subsidiaries
Guarant
Compl
Relevant ee
Date of ete
disclosure Amount for
Name of the happening Actual imple
date/No. of of Guarantee associate
Company (Date o mount of Guarantee term mentat
the guarante type d
guaranteed signing guarantee ion
guaranteed e parties
agreement) or
amount (Yes or
not
no)
Hangzhou
Guoneng Steam Two years from the
The joint liability
Turbine June 12,2018 7,000 March 28,2018 5,689.45 date of expiration of No No
guaranty
Engineering Co., the principal debt
Ltd.
Hangzhou
Guoneng Steam Two years from the
The joint liability
Turbine June 12,2018 10,000 May 23,2018 3,851.32 date of expiration of No No
guaranty
Engineering Co., the principal debt
Ltd.
Total amount of guarantee to the
Total guarantee quota to the subsidiaries
17,000 subsidiaries actually incurred in 9,540.77
approved in the reporting period (C1)
the reporting period (C2)
Total balance of actual
Total guarantee quota to the subsidiaries
guarantee to the subsidiaries at
approved at the end of the reporting period 17,000 9,540.77
the end of the reporting period
(C3)
(C4)
Total of Company’s guarantee（namely total of the large three aforementioned）
Total of guarantee in the Period Total of actual guarantee in
21,000 37,340.77
（A1+B1+C1） the Period（A2+B2+C2）
Total of actual guarantee at
Total of guarantee at Period-end
44,800 Period-end 37,340.77
（A3+B3+C3）
（A4+B4+C4）
The proportion of the total amount of actually guarantee in the net 6.33%
32
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
assets of the company(A4+B4+C4)
Including ：
Amount of guarantee for shareholders, actual controller and its
20,800
associated parties（D）
The debts guarantee amount provided for the
Guaranteed parties whose assets-liability ratio exceed 9,540.77
70% directly or indirectly（E）
Proportion of total amount of guarantee in net assets of the company
0
exceed 50%（F）
Total guarantee Amount of the abovementioned guarantees（D+E+F） 30,340.77
Explanations on possibly bearing joint and several liquidating
Nil
responsibilities for undue guarantees ( If any)
Explanations on external guarantee against regulated procedures(If
Nil
any)
Description of the guarantee with complex method
Hangzhou Heavy Machinery Co., Ltd, which is the company's subsidiary, had made an application of special
construction funds of 208 million to China Development Fund Co.,Ltd, and it has signed the four-party China
Development Fund Investment Contract with China Development Fund ,the company and Hangzhou Steam
Turbine Group Co.,Ltd. In order to ensure the performance of the "Investment contract" by Hangzhou steam
group, the company and the Heavy Machinery Co., Ltd provide guarantee for Hangzhou Steam Group in the
forms of pledge and mortgage. The contents is detailed in the Announcement on External Guarantee of
Hangzhou Steam Turbine Co., Ltd. announced on October 22, 2016 at the website designated by the Shenzhen
Stock Exchange (http // www.cninfo.com.cn). (Announcement No. 2016-75)
（2）Illegal providing of external guarantees
No illegal providing of external guarantees in the report period.
3. Other significant contracts
No such cases in the reporting period.
XV.Social responsibilities
1.Major environmental protection
Listed company and its subsidiary belongs to the key pollution enterprise listed by Department of Environmental
Protection
No
Neither the company nor its subsidiaries belong to the key pollutant discharge units announced by the
environmental protection department. The company has formulated and perfected the environmental
management systems and control procedures for various types of waste water, waste gas, waste slag, and noise in
accordance with relevant environmental laws and regulations and relevant standards promulgated by the national
33
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
and local governments. The company has imported ISO14001 environmental management system since 2006
and the system has been operated effectively for more than ten years. Currently, the company has adopted the
clean production management and launched the clean production audits, which not only reduces consumption
and increases efficiency, but also reduces the pressure and cost of end-of-pipe management. In terms of
environmental greening, after years of meticulous maintenance, the company has become a garden-style
enterprise.
The company's environmental management system has been in operation for many years, and it has been
strictly abiding by the relevant laws and regulations of the state and the principle of continuous improvement.
Each year, the company formulates the annual environmental protection goals and formulates the environmental
management plans. The company also has a complete and effective management system for waste water, waste
gas, waste residue and noise and other waste management. Over the years, there has been no incident of
environmental pollution and emissions exceeding the standard.
2.Overview of the annual targeted poverty alleviation
Since 2017, the company has participated in the “Lian xiang jie Cun” assistance activity in Hangzhou. It has
provided funds for RMB 150,000 per year to the Zitong Town of Chun'an County to help the poor poverty
alleviation in the form of cash assistance.
XVI.Other material events
1.Follow-up progress of the relocation of land in Hangzhou Steam Turbine Plant Area
The company signed the “Compensation Agreement for the Relocation of Non-residential Houses on
State-owned Land” with Hangzhou Xiacheng City Construction Investment Development Group Co., Ltd. The
company received a total of RMB 1,299,324,850 for relocation compensation; the company’s holding subsidiary
Hangzhou Steam Turbine Machinery Equipment Co., Ltd. received a total of compensation of RMB 6,625,450.
The complete report is available as Announcement 2018-1 and Announcement 2018-10 with Securities Times,
Shanghai Securities Daily, Hong Kong Commercial Daily and at www.cninfo.com.cn dated January 4,2018 and
March 21, 2018.
2. The company waived the preemptive right of the capital contribution in the capital increase of the casting
company.
The casting company, a holding subsidiary to the company, planed to increase the registered capital from 22
million yuan to 30 million yuan. The company waived the preemptive right of the capital contribution in the
capital increase.The complete report is available as Announcement 2018-05 with Securities Times, Shanghai
Securities Daily, Hong Kong Commercial Daily and at www.cninfo.com.cn dated May 26,2018.
3.The matter of the estimated amount of routine related transactions of the company in 2018 unapproved by the
shareholders’ meeting
The “Proposal for the Estimated Amount of the Company's 2018 Annual Routine Related Party Transactions”
34
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
had been submitted to the 2017 Annual General Meeting of the Company and the First Extraordinary General
Meeting of Shareholders in 2018 for consideration, and the related party Hangzhou Steam Turbine Group
avoided the voting, with the result that it had not been approved.The complete report is available as
Announcement 2018-36 and Announcement 2018-54 with Securities Times, Shanghai Securities Daily, Hong
Kong Commercial Daily and at www.cninfo.com.cn dated April 28,2018 and July 21, 2018.
XVII. Material events of subsidiaries
1.The matter of intending to increase capital and expand shares by the holding subsidiary
The casting & forging company, a company's holding subsidiary, is affected by the overall sluggish market
situation of the equipment manufacturing industry and the intensified market competition, therefore it will not
have sufficient profitability in the future. The casting & forging company plans to increase its capital and expand
its shares and introduce new strategic investors to upgrade its production capacity and enhance its comprehensive
competitiveness.The complete report is available as Announcement 2018-05 with Securities Times, Shanghai
Securities Daily, Hong Kong Commercial Daily and at www.cninfo.com.cn dated May 26,2018.
VI. Change of share capital and shareholding of Principal Shareholders
I.Changes in share capital
1. Changes in share capital
In shares
Before the change Increase/decrease（+，-） After the Change
Amount Proportion Capitaliz
ation of
Share Bonus Subtot
common Other Quantity Proportion
allotment shares al
reserve
fund
I. Unlisted shares 479,824,800 63.64% 0 0 0 0 0 479,824,800 63.64%
1. Founder's stock 479,824,800 63.64% 0 0 0 0 0 479,824,800 63.64%
Including: State-owned shares 479,824,800 63.64% 0 0 0 0 0 479,824,800 63.64%
II. Shares without trading limited
274,185,600 36.36% 0 0 0 0 0 274,185,600 36.36%
conditions
2.Foreign shares listed by domestic a 274,185,600 36.36% 0 0 0 0 0 274,185,600 36.36%
III. Total of capital shares 754,010,400 100.00% 0 0 0 0 0 754,010,400 100.00%
Causes of Change of shares
Not applicable
Approval of change of the shares
35
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Not applicable
Transfer in change of shares
Not applicable
Influence of the change of the shares upon such financial indicators as the basic EPS and diluted EPS, net asset
value per share attributable to the common stockholders in the past year and the latest period
Not applicable
Other information the Company considers it necessary or required by the securities regulatory authority to be
disclosed
Not applicable
2. Change of shares with limited sales condition
Not applicable
II.Issuing and listing
Not applicable
III. Shareholders and shareholding
In Shares
Total number of preferred
Total number of common
shareholders that had restored the
shareholders at the end of the 14,267 0
voting right at the end of the
reporting period
reporting period (if any)
Particulars about shares held above 5% by shareholders or top ten shareholders
Number or
share
Proporti
Number of Changes in Amount of Amount of pledged/froze
Shareholders Nature of on of
shares held at reporting restricted shares un-restricted n
shareholder shares
period -end period held shares held State
held（%） Amou
of
nt
share
Hangzhou Steam Turbine Power Group State-owned
legal person 63.64% 479,824,800 0 479,824,800 0
Co., Ltd.
VANGUARD EMERGING MARKETS Foreign legal
0.63% 4,722,804 0 0 4,722,804
STOCK INDEX FUND person
NORGES BANK Foreign legal 0.57% 4,303,675 0 0 4,303,675
36
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
person
Domestic
Zhou Jie 0.48% 3,600,000 924,000 0 3,600,000
Natural person
VANGUARD TOTAL
Foreign legal
INTERNATIONAL STOCK INDEX 0.46% 3,454,046 0 0 3,454,046
person
FUND
ISHARES CORE MSCI EMERGING Foreign legal
0.43% 3,278,101 532,200 0 3,278,101
MARKETS ETF person
GUOTAIJUNAN Foreign legal
0.39% 2,918,963 457,083 0 2,918,963
SECURITIES(HONGKONG) LIMITED person
State-owned
China Merchants Secutities(HK)Co., Ltd. 0.37% 2,800,417 400,268 0 2,800,417
legal person
Foreign
Xia Zulin 0.29% 2,179,300 -10,700 0 2,179,300
natural person
CREDIT SUISSE AG HONG KONG Foreign legal
0.21% 1,571,959 -157,800 0 1,571,959
BRANCH person
Particulars about strategic investors or general
corporations becoming among the top 10 shareholders Not applicable
due to share placing (if any)
(1) Hangzhou Steam Turbine Power Group Co., Ltd. is the holder of state-shares of the
Company, all other shareholders’ are holders of domestic listed foreign shares (B shares)
(2) There is no relationship between Hangzhou Steam Turbine Power Group Co., Ltd.
Explanation on associated relationship among the and other shareholders;
aforesaid shareholders (3) Hangzhou Steam Turbine Power Group Co., Ltd. is not an “action-in-concert” party
with any of other shareholders as described by the “Administration Rules of
Informational Disclosure about Change of Shareholding Statues of PLCs”.
Top 10 holders of shares without trading limited conditions
Amount of unconditional Category of shares
Name of the shareholder
shares held at end of period Category of shares Amount
Foreign shares placed in
VANGUARD EMERGING MARKETS STOCK INDEX FUND 4,722,804 4,722,804
domestic exchange
Foreign shares placed in
NORGES BANK 4,303,675 4,303,675
domestic exchange
Foreign shares placed in
Zhou Jie 3,600,000 3,600,000
domestic exchange
VANGUARD TOTAL INTERNATIONAL STOCK INDEX Foreign shares placed in
3,454,046 3,454,046
FUND domestic exchange
Foreign shares placed in
ISHARES CORE MSCI EMERGING MARKETS ETF 3,278,101 3,278,101
domestic exchange
Foreign shares placed in
GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED 2,918,963 2,918,963
domestic exchange
Foreign shares placed in
China Merchants Secutities(HK)Co., Ltd. 2,800,417 2,800,417
domestic exchange
Foreign shares placed in
Xia Zulin 2,179,300 2,179,300
domestic exchange
37
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Foreign shares placed in
CREDIT SUISSE AG HONG KONG BRANCH 1,571,959 1,571,959
domestic exchange
Foreign shares placed in
Wang Yihu 1,441,324 1,441,324
domestic exchange
1）It is unknown to the Company if there is any relationship among the top 10
Explanation on associated relationship or consistent action among
common share holders without restriction;
the top 10 shareholders of non-restricted negotiable shares and
(2) Hangzhou Steam Turbine Group Co., Ltd. is not an action-in-concert” party
that between the top 10 shareholders of non-restricted negotiable
with any of other shareholders as described by the “Administration Rules of
shares and top 10 shareholders
Informational Disclosure about Change of Shareholding Statues of PLCs”.
Top ten ordinary shareholders conducting securities margin
Not applicable
trading
Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a
buy-back agreement dealing in reporting period.
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.
IV. Change of the controlling shareholder or the actual controller
Change of the controlling shareholder in the reporting period
There was no any change of the controlling shareholder of the Company in the reporting period.
Change of the actual controller in the reporting period
There was no any change of the actual controller of the Company in the reporting period.
38
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
VII. Situation of the Preferred Shares
The Company had no preferred shares in the reporting period
39
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
VIII. Information about Directors, Supervisors and Senior Executives
I. Change in shares held by directors, supervisors and senior executives
Amount of Amount of Number of Number of
Number of
Shares shares shares Shares restricted restricted
restricted stock
Office held at the increased at decreased at held at the stock granted stock granted
Name Position granted at the
status year-begin the reporting the reporting year-endin at the at the
year-ending(shar
(share) period(share period(share g（share） year-begin . reporting
e)
) ) share) period(share)
Zheng
Chairman In office 0 0 0 0 0 0 0
Bin
Yan
Vice Chairman In office 0 0 0 0 0 0 0
Jinhua
Yang
Yongmi Vice Chairman In office 0 0 0 0 0 0 0
ng
Ye Director, General
In office 0 0 0 0 0 0 0
Zhong Manager
Wang Director, secretary of
In office 0 0 0 0 0 0 0
Gang the board
Kong
Director, Vice GM,
Jianqian In office 0 0 0 0 0 0 0
Chief engineer
g
Gu
Independent Director In office 0 0 0 0 0 0 0
Xinjian
Ma
Independent Director In office 0 0 0 0 0 0 0
Lihong
ZhangXi
Independent Director In office 0 0 0 0 0 0 0
aoyan
Chen
Danhon Independent Director In office 0 0 0 0 0 0 0
g
Chairman of the
Li Shijie In office 0 0 0 0 0 0 0
Supervisory Committee
Wang
Supervisor In office 97,576 3,100 0 100,676 0 0 0
Xiaohui
Liu
Supervisor In office 16,600 0 0 16,600 0 0 0
Zhiyong
40
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Lu
Employee Supervisor In office 0 0 0 0 0 0 0
Jianhua
Fang
Employee Supervisor In office 0 0 0 0 0 0 0
Yin
Zhang
Vice GM In office 66,924 0 0 66,924 0 0 0
Shutan
Zhao Deputy GM, Chief
In office 0 0 0 0 0 0 0
Jiamao Accountant
Li
Jianshen Vice GM In office 0 0 0 0 0 0 0
g
Wang
Zhengro Vice GM In office 0 0 0 0 0 0 0
ng
Total -- -- 181,100 3,100 0 184,200 0 0 0
II. Change in shares held by directors, supervisors and senior executives
Name Positions Types Date Reason
Mr. Zhao Jiamao has been appointed as the company's
Deputy General Manager, Appointm
Zhao Jiamao January 1,2018 deputy general manager and chief accountant since
Chief Accountant ent
January 1, 2018.
41
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
IX. Corporate Bond
Whether the company has corporate bonds that have been publicly issued and listed on the stock exchange, and
not yet due or due but not folly cashed on the approval date of the semi-annual report
No
42
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
X. Financial Report
I. Auditors’ Report
The Semi-annual Financial Report is not audited.
II. The Financial Statements
All figures in the Notes to the Financial Statements are in RMB.
1. Consolidated Balance Sheet
Prepared by: Hangzhou Steam Turbine Co., Ltd
June 30,2018
In RMB
Items At the end of term Beginning of term
Current asset：
Monetary fund 1,230,803,798.79 1,222,677,495.94
Settlement provision
Outgoing call loan
Financial assets measured at fair value with variations
accounted into current income account
Derivative financial assets
Note receivable 701,265,837.50 715,410,887.68
Account receivable 1,921,794,558.44 1,695,217,448.46
Prepayments 424,376,043.43 446,166,710.77
Insurance receivable
Reinsurance receivable
Provisions of Reinsurance contracts receivable
Interest receivable
Dividend receivable 6,900,000.00 6,900,000.00
Other account receivable 20,160,455.24 16,905,005.57
Repurchasing of financial assets
Inventories 2,055,625,339.61 2,092,575,691.92
Assets held for sales
Non-current asset due in 1 year
Other current asset 1,332,266,723.15 904,426,265.79
Total of current assets 7,693,192,756.16 7,100,279,506.13
Non-current assets：
Loans and payment on other’s behalf disbursed
Disposable financial asset 2,248,334,490.64 2,417,780,984.08
Expired investment in possess
Long-term receivable
Long term share equity investment 5,800,000.00 5,800,000.00
Property investment
Fixed assets 540,574,836.70 566,710,937.10
Construction in progress 400,143,683.78 255,921,660.09
43
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Engineering material
Fixed asset disposal
Production physical assets
Gas & petrol
Intangible assets 283,381,476.47 285,670,638.55
R & D petrol
Goodwill
Long-germ expenses to be amortized 126,943.46 253,886.90
Deferred income tax asset 193,963,501.10 198,179,569.53
Other non-current asset
Total of non-current assets 3,672,324,932.15 3,730,317,676.25
Total of assets 11,365,517,688.31 10,830,597,182.38
Current liabilities
Short-term loans 140,000,000.00 115,500,000.00
Loan from Central Bank
Deposit received and hold for others
Call loan received
Financial liabilities measured at fair value with variations
accounted into current income account
Derivative financial liabilities
Note payable 264,683,667.48 215,409,958.92
Account payable 1,069,091,984.87 882,715,465.65
Advance payment 2,600,249,461.40 2,419,751,405.08
Selling of repurchased financial assets
Fees and commissions receivable
Employees’ wage payable 94,296,234.25 79,525,773.69
Tax payable 82,776,263.80 34,920,073.37
Interest payable 100,958.90 268,860.77
Dividend payable
Other account payable 34,533,106.50 27,859,617.33
Reinsurance fee payable
Insurance contract provision
Entrusted trading of securities
Entrusted selling of securities
Liabilities held for sales
Non-current liability due in 1 year 4,900,000.00
Other current liability
Total of current liability 4,285,731,677.20 3,780,851,154.81
Non-current liabilities：
Long-term loan 122,800,000.00 100,000,000.00
Bond payable
Including：preferred stock
Sustainable debt
Long-term payable 208,330,000.00 209,633,466.66
Long-term payable employees’s remuneration
Special payable 237,658,831.07 237,658,831.07
Expected liabilities
44
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Deferred income 4,063,615.00 4,063,615.00
Deferred income tax liability 265,400,693.92 278,217,667.94
Other non-current liabilities
Total non-current liabilities 838,253,139.99 829,573,580.67
Total of liability 5,123,984,817.19 4,610,424,735.48
Owners’ equity
Share capital 754,010,400.00 754,010,400.00
Other equity instrument
Including：preferred stock
Sustainable debt
Capital reserves 139,545,089.02 139,545,089.02
Less：Shares in stock
Other comprehensive income 1,497,694,788.09 1,570,358,510.09
Special reserves 24,519,112.32 25,369,714.61
Surplus reserves 621,112,807.78 621,112,807.78
Common risk provision
Undistributed profit 2,865,230,362.06 2,774,420,288.05
Total of owner’s equity belong to the parent company 5,902,112,559.27 5,884,816,809.55
Minority shareholders’ equity 339,420,311.85 335,355,637.35
Total of owners’ equity 6,241,532,871.12 6,220,172,446.90
Total of liabilities and owners’ equity 11,365,517,688.31 10,830,597,182.38
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jin Chan
45
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
2.Parent Company Balance Sheet
In RMB
Items At the end of term Beginning of term
Current asset：
Monetary fund 778,772,007.83 654,407,180.33
Financial assets measured at fair value with
variations accounted into current income account
Derivative financial assets
Note receivable 450,684,104.74 357,644,500.75
Account receivable 1,381,490,698.17 1,195,950,107.32
Prepayments 169,489,927.32 163,701,036.86
Interest receivable
Dividend receivable 6,900,000.00 6,900,000.00
Other account receivable 5,951,147.45 4,311,538.86
Inventories 1,379,988,731.61 1,598,522,597.27
Assets held for sales
Non-current asset due in 1 year
Other current asset 1,000,957,798.62 737,474,571.12
Total of current assets 5,174,234,415.74 4,718,911,532.51
Non-current assets：
Disposable financial asset 2,207,574,801.06 2,377,021,294.50
Expired investment in possess
Long-term receivable
Long term share equity investment 502,919,378.03 502,919,378.03
Property investment
Fixed assets 248,692,861.33 265,423,321.11
Construction in progress 178,108,830.71 151,569,540.89
Engineering material
Fixed asset disposal
Production physical assets
Gas & petrol
Intangible assets 167,757,334.19 169,780,320.65
R & D petrol
Goodwill
Long-germ expenses to be amortized 126,943.46 253,886.90
Deferred income tax asset 144,631,311.48 146,802,178.11
Other non-current asset
Total of non-current assets 3,449,811,460.26 3,613,769,920.19
Total of assets 8,624,045,876.00 8,332,681,452.70
Current liabilities
Short-term loans
46
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Financial liabilities measured at fair value with
variations accounted into current income account
Derivative financial liabilities
Note payable 6,400,000.00 5,400,000.00
Account payable 536,295,567.25 457,304,271.86
Advance payment 1,920,667,918.77 1,817,869,660.07
Employees’ wage payable 65,625,049.13 42,770,536.86
Tax payable 63,890,011.11 3,918,864.69
Interest payable 100,958.90 112,597.22
Dividend payable
Other account payable 22,014,753.94 15,515,940.17
Classified as held for sale debt
Non-current liability due in 1 year
Other current liability
Total of current liability 2,614,994,259.10 2,342,891,870.87
Non-current liabilities：
Long-term loan 100,000,000.00 100,000,000.00
Bond payable
Including：preferred stock
Sustainable debt
Long-term payable
Long-term payable to employees
Special payable 237,067,491.46 237,067,491.46
Expected liabilities
Deferred income
Deferred income tax liability 265,400,693.92 278,217,667.94
Other non-current liabilities
Total of Non-current liabilities 602,468,185.38 615,285,159.40
Total of liability 3,217,462,444.48 2,958,177,030.27
Owners’ equity
Share capital 754,010,400.00 754,010,400.00
Other equity instrument
Including：preferred stock
Sustainable debt
Capital reserves 138,953,250.09 138,953,250.09
Less：Shares in stock
Other comprehensive income 1,498,283,089.67 1,570,912,609.09
Special reserves 9,422,619.40 9,629,800.19
Surplus reserves 602,356,402.65 602,356,402.65
Undistributed profit 2,403,557,669.71 2,298,641,960.41
Total of owners’ equity 5,406,583,431.52 5,374,504,422.43
Total of liabilities and owners’ equity 8,624,045,876.00 8,332,681,452.70
47
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jin Chan
48
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
3.Consolidated Income statement
In RMB
Same period of the previous
Items Report period
year
I. Income from the key business 2,284,130,982.13 1,663,724,702.26
Incl：Business income 2,284,130,982.13 1,663,724,702.26
Interest income
Insurance fee earned
Fee and commission received
II. Total business cost 2,150,863,834.60 1,690,731,044.09
Incl：Business cost 1,612,116,152.26 1,192,385,051.48
Interest expense
Fee and commission paid
Insurance discharge payment
Net claim amount paid
Insurance policy dividend paid
Insurance policy dividend paid
Reinsurance expenses
Business tax and surcharge 29,819,229.04 18,736,550.58
Sales expense 77,008,302.22 81,874,015.85
Administrative expense 388,805,621.19 354,411,777.81
Financial expenses 3,177.07 7,945,244.29
Asset impairment loss 43,111,352.82 35,378,404.08
Add：Gains from change of fir value （“-”for loss）
Investment gain（“-”for loss） 37,144,607.44 88,988,506.53
Incl: investment gains from affiliates
Gains from currency exchange（“-”for loss）
Assets disposal income 185,618.53
Other income 20,337,694.45 2,505,237.27
III. Operational profit（“-”for loss） 190,749,449.42 64,673,020.50
Add ：Non-operational income 4,189,726.48 1,852,702.51
Less：Non business expenses 2,591,154.54 268,499.56
IV.Total profit(“-”for loss) 192,348,021.36 66,257,223.45
Less：Income tax expenses 31,977,871.82 6,528,367.57
V. Net profit 160,370,149.54 59,728,855.88
(1) Categorized by going concern 160,370,149.54 59,728,855.88
(2) Termination of operating net profit
Net profit attributable to the owners of parent company 128,510,594.01 43,995,804.38
Minority shareholders’ equity 31,859,555.53 15,733,051.50
VI. Other comprehensive income -72,709,845.63 -18,278,353.57
Net of profit of other comprehensive income attributable to owners of the p
-72,663,722.00 -18,615,099.34
arent company.
（I）Other comprehensive income items that will not be reclassified into
gains/losses in the subsequent accounting period
1.Re-measurement of defined benefit plans of changes in net debt or net ass
ets
2.Other comprehensive income under the equity method investee can not b
49
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
e reclassified into profit or loss.
（II）
-72,663,722.00 -18,615,099.34
Other comprehensive income that will be reclassified into profit or loss.
1.Other comprehensive income under the equity method investee can be rec
lassified into profit or loss.
2.Gains and losses from changes in fair value available for sale financial as
-72,629,519.42 -18,864,810.24
sets
3.Held-to-maturity investments reclassified to gains and losses of available
for sale financial assets
4.The effective portion of cash flow hedges and losses
5.Translation differences in currency financial statements -34,202.58 249,710.90
6.Other
Net of profit of other comprehensive income attributable to Minority
-46,123.63 336,745.77
shareholders’ equity
VII. Total comprehensive income 87,660,303.91 41,450,502.31
Total comprehensive income attributable to the owner of the parent
55,846,872.01 25,380,705.04
company
Total comprehensive income attributable minority shareholders 31,813,431.90 16,069,797.27
VIII. Earnings per share
（I）Basic earnings per share 0.17 0.06
(II)Diluted earnings per share 0.17 0.06
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jin Chan
50
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
4. Income statement of the Parent Company
In RMB
Same period of the previous
Items Report period
year
I. Income from the key business 1,490,738,884.48 1,116,145,080.61
Less：Business cost 1,092,425,706.34 848,982,146.60
Business tax and surcharge 19,980,875.77 8,356,402.38
Sales expense 42,075,448.13 49,356,881.16
Administrative expense 266,958,157.41 250,148,727.95
Financial expenses -1,279,101.79 6,147,008.61
Asset impairment loss 32,973,333.00 27,643,907.83
Add：Gains from change of fir value （“-”for loss）
Investment gain（“-”for loss） 97,645,790.91 141,313,652.53
Incl: investment gains from affiliates
Assets disposal income
Other income 18,256,287.33
II. Operational profit（“-”for loss） 153,506,543.86 66,823,658.61
Add ：Non-operational income 4,125,525.27 1,412,613.95
Less：Non business expenses 991,089.95 13,869.40
III.Total profit(“-”for loss) 156,640,979.18 68,222,403.16
Less：Income tax expenses 14,024,749.88 -4,777,117.03
IV. Net profit 142,616,229.30 72,999,520.19
(1) Categorized by going concern 142,616,229.30 72,999,520.19
(2) Termination of operating net profit
V.Net of profit of other comprehensive income -72,629,519.42 -18,864,810.24
（I）Other comprehensive income items that will not be reclassified
into gains/losses in the subsequent accounting period
1.Re-measurement of defined benefit plans of changes in net debt or
net assets
2.Other comprehensive income under the equity method investee can
not be reclassified into profit or loss.
（ II ）
Other comprehensive income that will be reclassified into profit or lo -72,629,519.42 -18,864,810.24
ss.
1.Other comprehensive income under the equity method investee can
be reclassified into profit or loss.
2.Gains and losses from changes in fair value available for sale financ
ial assets -72,629,519.42 -18,864,810.24
3.Held-to-maturity investments reclassified to gains and losses of ava
ilable for sale financial assets
4.The effective portion of cash flow hedges and losses
5.Translation differences in currency financial statements
6.Other
VI. Total comprehensive income 69,986,709.88 54,134,709.95
51
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
VII. Earnings per share：
（I）Basic earnings per share 0.19 0.10
(II)Diluted earnings per share 0.19 0.10
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jin Chan
52
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
5. Consolidated Cash flow statement
In RMB
Items Report period Same period of the previous year
I.Cash flows from operating activities
Cash received from sales of goods or rending of services 1,990,685,784.21 1,555,387,534.42
Net increase of customer deposits and capital kept for
brother company
Net increase of loans from central bank
Net increase of inter-bank loans from other financial bodies
Cash received against original insurance contract
Net cash received from reinsurance business
Net increase of client deposit and investment
Net increase of trade financial asset disposal
Cash received as interest, processing fee and commission
Net increase of inter-bank fund received
Net increase of repurchasing business
Tax returned 2,343,735.23 12,410,348.67
Other cash received from business operation 21,813,193.03 8,010,282.03
Sub-total of cash inflow 2,014,842,712.47 1,575,808,165.12
Cash paid for purchasing of merchandise and services 848,782,286.99 981,236,472.17
Net increase of client trade and advance
Net increase of savings n central bank and brother company
Cash paid for original contract claim
Cash paid for interest, processing fee and commission
Cash paid for policy dividend
Cash paid to staffs or paid for staffs 354,090,861.86 364,610,619.54
Taxes paid 170,805,653.61 161,287,307.24
Other cash paid for business activities 83,376,719.28 78,984,121.75
Sub-total of cash outflow from business activities 1,457,055,521.74 1,586,118,520.70
Cash flow generated by business operation, net 557,787,190.73 -10,310,355.58
II.Cash flow generated by investing
Cash received from investment retrieving 100,000,000.00 48,558,351.80
Cash received as investment gains 37,144,607.44 82,088,506.53
Net cash retrieved from disposal of fixed assets, intangible
assets, and other long-term assets 411,254.18
Net cash received from disposal of subsidiaries or other
operational units
Other investment-related cash received 2,054,176,329.00 1,819,767,338.00
53
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Sub-total of cash inflow due to investment activities 2,191,320,936.44 1,950,825,450.51
Cash paid for construction of fixed assets, intangible assets
and other long-term assets 207,219,715.24 43,584,080.28
Cash paid as investment 16,000,000.00 20,000,000.00
Net increase of loan against pledge
Net cash received from subsidiaries and other operational
units
Other cash paid for investment activities 2,477,114,000.00 1,729,150,000.00
Sub-total of cash outflow due to investment activities 2,700,333,715.24 1,792,734,080.28
Net cash flow generated by investment -509,012,778.80 158,091,370.23
III.Cash flow generated by financing
Cash received as investment
Incl: Cash received as investment from minor shareholders
Cash received as loans 115,000,000.00 84,700,000.00
Cash received from bond placing
Other financing –related ash received
Sub-total of cash inflow from financing activities 115,000,000.00 84,700,000.00
Cash to repay debts 72,600,000.00 60,200,000.00
Cash paid as dividend, profit, or interests 70,365,668.92 40,718,824.40
Incl: Dividend and profit paid by subsidiaries to minor
shareholders
Other cash paid for financing activities 2,530,666.67 12,824,456.40
Sub-total of cash outflow due to financing activities 145,496,335.59 113,743,280.80
Net cash flow generated by financing -30,496,335.59 -29,043,280.80
IV. Influence of exchange rate alternation on cash and cash
equivalents -516,323.71 -3,125,917.43
V.Net increase of cash and cash equivalents 17,761,752.63 115,611,816.42
Add: balance of cash and cash equivalents at the beginning of
term 1,137,492,834.83 895,037,559.34
VI ..Balance of cash and cash equivalents at the end of term 1,155,254,587.46 1,010,649,375.76
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jin Chan
54
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
6. Cash Flow Statement of the Parent Company
In RMB
Items Amount in this period Amount in last period
I.Cash flows from operating activities
Cash received from sales of goods or rending of services 1,092,421,368.98 1,049,529,364.15
Tax returned
Other cash received from business operation 5,955,302.39 2,093,123.85
Sub-total of cash inflow 1,098,376,671.37 1,051,622,488.00
Cash paid for purchasing of merchandise and services 437,942,428.63 734,953,285.93
Cash paid to staffs or paid for staffs 227,570,629.51 253,543,483.95
Taxes paid 90,652,184.51 94,956,342.26
Other cash paid for business activities 26,292,496.98 27,015,518.68
Sub-total of cash outflow from business activities 782,457,739.63 1,110,468,630.82
Cash flow generated by business operation, net 315,918,931.74 -58,846,142.82
II.Cash flow generated by investing
Cash received from investment retrieving 100,000,000.00 48,558,351.80
Cash received as investment gains 97,645,790.91 134,413,652.53
Net cash retrieved from disposal of fixed assets, intangible assets,
and other long-term assets
Net cash received from disposal of subsidiaries or other
operational units
Other investment-related cash received 1,510,049,339.73 1,145,943,056.16
Sub-total of cash inflow due to investment activities 1,707,695,130.64 1,328,915,060.49
Cash paid for construction of fixed assets, intangible assets and
other long-term assets 67,740,573.08 24,023,500.62
Cash paid as investment 16,000,000.00 20,000,000.00
Net cash received from subsidiaries and other operational units
Other cash paid for investment activities 1,780,000,000.00 1,005,000,000.00
Sub-total of cash outflow due to investment activities 1,863,740,573.08 1,049,023,500.62
Net cash flow generated by investment -156,045,442.44 279,891,559.87
III.Cash flow generated by financing
Cash received as investment
Cash received as loans
Cash received from bond placing
Other financing –related ash received
Sub-total of cash inflow from financing activities
Cash to repay debts
Cash paid as dividend, profit, or interests 40,616,895.37 1,693,611.11
Other cash paid for financing activities
Sub-total of cash outflow due to financing activities 40,616,895.37 1,693,611.11
Net cash flow generated by financing -40,616,895.37 -1,693,611.11
IV. Influence of exchange rate alternation on cash and cash
equivalents -333,572.64 -3,383,920.25
V.Net increase of cash and cash equivalents 118,923,021.29 215,967,885.69
Add: balance of cash and cash equivalents at the beginning of
term 650,546,455.53 293,454,126.93
55
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
VI ..Balance of cash and cash equivalents at the end of term 769,469,476.82 509,422,012.62
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jin Chan
56
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
7. Consolidated Statement on Change in Owners’ Equity
Amount in this period
In RMB
Amount in this period
Owner’s equity Attributable to the Parent Company
Other Equity
Less
instrument
: Minor
Items pref Other Common Total of owners’
Capital Shar Specialized Undistributed shareholders’
Share Capital erre Sust Comprehensive Surplus reserves risk equity
reserves es in reserve profit equity
d aina Other Income provision
stoc
stoc ble
k
k debt
139,545,089. 2,774,420,288.
I.Balance at the end of last year 754,010,400.00 1,570,358,510.09 25,369,714.61 621,112,807.78 335,355,637.35 6,220,172,446.90
02 05
Add: Change of accounting policy
Correcting of previous errors
Merger of entities under common
control
Other
II.Balance at the beginning of 139,545,089. 2,774,420,288.
754,010,400.00 1,570,358,510.09 25,369,714.61 621,112,807.78 335,355,637.35 6,220,172,446.90
current year 02 05
III.Changed in the current year -72,663,722.00 -850,602.29 90,810,074.01 4,064,674.50 21,360,424.22
（1）Total comprehensive income -72,663,722.00 128,510,594.01 31,813,431.90 87,660,303.91
(II) Investment or decreasing of
capital by owners
1 ． Ordinary Shares invested by sha
reholders
2．Holders of other equity instrume
57
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
nts invested capital
3.Amount of shares paid and
accounted as owners’ equity
4．Other
（III）Profit allotment -37,700,520.00 -27,512,795.00 -65,213,315.00
1.Providing of surplus reserves
2.Providing of common risk
provisions
3．Allotment to the owners (or
-37,700,520.00 -27,512,795.00 -65,213,315.00
shareholders)
4．Other
(IV) Internal transferring of owners’
equity
1. Capitalizing of capital reserves
(or to capital shares)
2. Capitalizing of surplus reserves
(or to capital shares)
3．Making up losses by surplus
reserves.
4. Other
(V). Special reserves -850,602.29 -235,962.40 -1,086,564.69
1. Provided this year 706,095.97 706,095.97
2．Used this term 1,556,698.26 235,962.40 1,792,660.66
（VI）Other
139,545,089. 2,865,230,362.
IV. Balance at the end of this term 754,010,400.00 1,497,694,788.09 24,519,112.32 621,112,807.78 339,420,311.85 6,241,532,871.12
02 06
58
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Amount in last year
In RMB
Amount in last year
Owner’s equity Attributable to the Parent Company
Other Equity instrument Les
s:
Capita Minor
Items Sha Other Total of
preferr l Specialized Common risk Undistribut shareholders’
Share Capital Sustain res Comprehensive Surplus reserves owners’ equity
ed Other reserv reserve provision ed profit equity
able in Income
stock es
debt stoc
k
139,5
2,705,667,0 6,745,622,670.
I.Balance at the end of last year 754,010,400.00 90,34 2,137,419,299.84 27,546,353.37 621,112,807.78 360,276,427.29
37.15 52
5.09
Add: Change of accounting policy
Correcting of previous errors
Merger of entities under common
control
Other
II.Balance at the beginning of 139,5
2,705,667,0 6,745,622,670.
754,010,400.00 90,34 2,137,419,299.84 27,546,353.37 621,112,807.78 360,276,427.29
current year 37.15 52
5.09
43,995,804.
III.Changed in the current year -18,615,099.34 -135,561.07 -37,956,943.19 -12,711,799.22
38
43,995,804.
（1）Total comprehensive income -18,615,099.34 16,069,797.27 41,450,502.31
38
(II) Investment or decreasing of
-19,800,000.00 -19,800,000.00
capital by owners
1 ． Ordinary Shares invested by sha
reholders
2．Holders of other equity instrume
59
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
nts invested capital
3.Amount of shares paid and
accounted as owners’ equity
4．Other
（III）Profit allotment -34,303,448.90 -34,303,448.90
1.Providing of surplus reserves
2.Providing of common risk
provisions
3．Allotment to the owners (or
-34,303,448.90 -34,303,448.90
shareholders)
4．Other
(IV) Internal transferring of owners’
equity
1. Capitalizing of capital reserves
(or to capital shares)
2. Capitalizing of surplus reserves
(or to capital shares)
3．Making up losses by surplus
reserves.
4. Other
(V). Special reserves -135,561.07 76,708.44 -58,852.63
1. Provided this year 537,862.83 220,142.02 758,004.85
2．Used this term 673,423.90 143,433.58 816,857.48
（VI）Other
139,5 2,749,662,8 6,732,910,871.
IV. Balance at the end of this term 754,010,400.00 2,118,804,200.50 27,410,792.30 621,112,807.78 322,319,484.10
90,34 41.53 30
60
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
5.09
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jin Chan
8.Statement of change in owner’s Equity of the Parent Company
Amount in this period
In RMB
Amount in this period
Other Equity instrument Less: Other Specialized
Items preferr Total of owners’
Share Capital Capital reserves Shares Comprehensive Surplus reserves Undistributed profit
ed Sustaina Other reserve equity
in stock Income
stock ble debt
I.Balance at the end of last year 754,010,400.00 138,953,250.09 1,570,912,609.09 9,629,800.19 602,356,402.65 2,298,641,960.41 5,374,504,422.43
Add: Change of accounting policy
Correcting of previous errors
Other
II.Balance at the beginning of
754,010,400.00 138,953,250.09 1,570,912,609.09 9,629,800.19 602,356,402.65 2,298,641,960.41 5,374,504,422.43
current year
III.Changed in the current year -72,629,519.42 -207,180.79 104,915,709.30 32,079,009.09
（I）Total comprehensive income -72,629,519.42 142,616,229.30 69,986,709.88
(II) Investment or decreasing of
capital by owners
1 ．Ordinary Shares invested by sha
reholders
2．Holders of other equity instrume
nts invested capital
3.Amount of shares paid and
61
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
accounted as owners’ equity
4．Other
（III）Profit allotment -37,700,520.00 -37,700,520.00
1.Providing of surplus reserves
2．Allotment to the owners (or
-37,700,520.00 -37,700,520.00
shareholders)
3．Other
(IV)Internal transferring of owners’
equity
1. Capitalizing of capital reserves
(or to capital shares)
2. Capitalizing of surplus reserves
(or to capital shares)
3．Making up losses by surplus
reserves.
4. Other
(V) Special reserves -207,180.79 -207,180.79
1. Provided this year 706,095.97 706,095.97
2．Used this term 913,276.76 913,276.76
（VI）Other
IV. Balance at the end of this term 754,010,400.00 138,953,250.09 1,498,283,089.67 9,422,619.40 602,356,402.65 2,403,557,669.71 5,406,583,431.52
Amount in last year
In RMB
Items Amount in last year
62
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Other Equity
instrument Less: Other Specialized Total of owners’
Share Capital Capital reserves Shares Comprehensive Surplus reserves Undistributed profit
preferr reserve equity
Sustai in stock Income
ed Other
nable
stock
debt
I.Balance at the end of last year 754,010,400.00 138,953,250.09 2,137,800,156.80 10,874,033.85 602,356,402.65 2,243,299,128.08 5,887,293,371.47
Add: Change of accounting policy
Correcting of previous errors
Other
II.Balance at the beginning of current
754,010,400.00 138,953,250.09 2,137,800,156.80 10,874,033.85 602,356,402.65 2,243,299,128.08 5,887,293,371.47
year
III.Changed in the current year -18,864,810.24 -25,333.02 72,999,520.19 54,109,376.93
（I）Total comprehensive income -18,864,810.24 72,999,520.19 54,134,709.95
(II) Investment or decreasing of
capital by owners
1．Ordinary Shares invested by share
holders
2 ． Holders of other equity instrumen
ts invested capital
3.Amount of shares paid and
accounted as owners’ equity
4．Other
（III）Profit allotment
1.Providing of surplus reserves
2．Allotment to the owners (or
63
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
shareholders)
3．Other
(IV)Internal transferring of owners’
equity
1. Capitalizing of capital reserves
(or to capital shares)
2. Capitalizing of surplus reserves
(or to capital shares)
3．Making up losses by surplus
reserves.
4. Other
(V) Special reserves -25,333.02 -25,333.02
1. Provided this year 299,375.65 299,375.65
2．Used this term 324,708.67 324,708.67
（VI）Other
IV. Balance at the end of this term 754,010,400.00 138,953,250.09 2,118,935,346.56 10,848,700.83 602,356,402.65 2,316,298,648.27 5,941,402,748.40
Legal Representative: Zheng Bin Person in charge of accounting：Zhao Jiamao Accounting Dept Leader: Jian Chan
64
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
III.Company Profile
Hangzhou Steam Turbine Co., Ltd. (the Company) was incorporated as a joint stock limited company
exclusively promoted by Hangzhou Steam Turbine & Power Group Company Limited (“HSTG”) approved by
the Securities Regulatory Commission of the State Council with the Document SRC [1998] No. 8 by offering
domestically listed foreign currency ordinary shares (B Shares), with registration date: April 23, 1998,
Headquartered in Hangzhou, Zhejiang Province. The company now holds a unified social credit code for the
913300007042026204 business license, The Company’s registered capital is increased to RMB754.0104 million
with total capital share of 754.0104 million shares (face value RMB1.00). Among which state-owned legal
person shares were 479.8248 million shares and 274.1856 million shares of current B shares. The shares were
issued and listed for trading in Shenzhen Stock Exchange on April 28, 1998.
The design, manufacturing, Main Business Activities: R&D, Production and Sales of Industrial Steam Turbine.
Main Products: Industrial Steam Turbine
19 subsidiaries including Zhejiang Steam Turbine Packaged Technologies Co., Ltd., Hangzhou Zhongneng Steam
Turbine Power Co., Ltd., Hangzhou Steam Turbine Casting Co., Hangzhou Steam Turbine Auxiliary Co., Ltd.,
Hangzhou Steam Turbine Machinery & Equipment Co., Ltd., Zhejiang Turbine Import & Export Co., Ltd., and
Hangzhou Steam Turbine Industry Co., Ltd., were consolidated to the Financial Statements. For details of
changing consolidation range and equity position please go to the Notes to the Financial Statements.
IV. Basis of compiling the finance report
(I) Basis of compiling
The Company adopts perpetual operation as the basis of financial statements.
(II) Assessment on perpetuation
No issue or situation, in 12 months since the end of report period, composes major doubt on the perpetuation
assumption of the Company.
V. Principal Accounting Policies and Estimations
Principal Accounting Policies and Estimations
Important prompt: The Company utilized detailed accounting polices and estimations on providing of bad debt
provisions, fixed asset depreciation, intangible asset amortization, recognition of revenue, and so forth, according
to its business practices.
1. Statement of compliance to the Enterprise Accounting Standard
The finance report produced by the Company is accordance with the Enterprise Accounting Standard, and reflects
the Company’s financial state, business performance and cash flow frankly and completely.
2. Fiscal year
The Company uses the calendar year for its fiscal year. A fiscal year is from January 1 to December 31.
3. Operational period
The Company’s relatively shorter operational period, which is 12 months, and is used as division of liquidity of
assets and liabilities.
4. Standard currency for bookkeeping
The Company uses Renminbi (RMB) as the standard currency for book keeping.
65
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
5. Accounting treatment of the entities under common control and different control
1. Treatment of entities under common control
Assets and liabilities acquired in merger of entities are measured at book values at the date of merger. The
difference between the net book value of asset and the offered price (or total of face value of shares issued) will
be adjusted into capital reserves; when the capital reserves is not enough to reduce, it will be adjusted into
retained profit.
2. Treatment of entities under different control
The difference of takeover cost over the fair value of recognizable net asset of the acquired entity is
recognized as goodwill at the day of takeover; in case the takeover cost is lower than the fair value of
recognizable net asset of the acquired entity, the measuring process over the recognizable asset, liabilities,
contingent liabilities, and takeover cost, shall be repeated, if comes out the same result, the difference shall be
recorded into current income
6. Method for preparing the consolidated financial statements
The parent company puts all of its subsidiaries under its control into the consolidated financial statements. The
consolidated financial statements are prepared according to the “Enterprise Accounting Standard No. 33 –
Consolidated Financial Statements”, basing on the accounts of the parent company and the subsidiaries, and after
adjusting the long-term investment equity in the subsidiary on equity basis.
7. Recognition of cash and cash equivalents
Cash equivalent refers to the investment held by the Company with short term, strong liquidity and lower risk of
value fluctuation that is easy to be converted into cash of known amount.
8. Foreign currency trade and translation of foreign currencies
1. Translation of foreign currency
Foreign currency trades are translated into RMB at the rate of the day when the trades are made. Those balances
of foreign currencies and monetary items in foreign currencies are accounted at the exchange rate of the balance
sheet date. Exchange differences, other than special loans satisfying the conditions of capitalization, are
accounted into current income account. Non-monetary items in foreign currencies and on historical cost are
translated at the rate of the trade day. Non-monetary items in foreign currencies and on fair value are translated
at the rate of the day when the fair value is recognized, where the differences are accounted as gain/loss from
change of fair value.
2. Translation of foreign currency financial statements
Asset and liability items in the balance sheet are translated basing on the exchange rate of the balance sheet date;
Owners’ equities other than Retained Profit are translated at the exchange rate of the date when the trade
happened. Income and expense items in the income statement are translated at the similar rate of the date when
the trade happened. Differences generated by the above translating of foreign currencies are demonstrated
separately under the owners’ equity in the balance sheet.
9. Financial instruments
1. Type of finance asset and finance debt
Finance assets are divided initially into four types of financial asset appointed to be measured at fair value with
their changes are accounted into current gain/loss accounts(including transactional finance asset and financial
66
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
asset appointed to be measured at fair value with their changes are accounted into current gain/loss accounts),
transactional financial assets, debt and account receivable, finance asset saleable.
Finance debts are divided initially into two types of financial debt appointed to be measured at fair value with
their changes are accounted into current gain/loss accounts(including transactional finance debt and financial
debt appointed to be measured at fair value with their changes are accounted into current gain/loss accounts),
other finance debt.
2. Basis of recognition and accounting of finance asset and finance debt
When the Company is one part of the finance instrument contract, one finance asset or debt is recognized. When
on recognizing initially finance asset or debt, it is measured by fair value, for the finance asset or debt which
appointed to be measured at fair value with their changes are accounted into current gain/loss accounts, the
related transaction expenses are directly accounted into current gain and loss; for other finance asset and debt, the
related transaction expenses accounted into the initial recognition account.
The Company future measures finance asset by fair value without deducting future possible transaction fee but
with exception: (1) Due investment, debt and account receivable are measured by actual interest rate according to
the amortized costs. (2) Equity instrument investment which have no quote in active market and which fair value
can’t be measured reliably, and its derived finance assets which are connected with the equity instrument and
which are summarized through the equity instrument, are measured by cost.
The Company conduct successive measure of finance debt according to amortized cost by actual interest rate
with exception as following: (1) finance debt which appointed to be measured at fair value with their changes are
accounted into current gain/loss accounts, is measured at fir value without deducting possible future transactional
fee at settlement; (2) Equity instrument investment which have no quote in active market and which fair value
can’t be measured reliably, and its derived finance assets which are connected with the equity instrument and
which are closed off through the equity instrument, are measured by cost. (3) finance debt guarantee contracts
which are not appointed to be measured at fair value with their changes are accounted into current gain/loss
accounts, or debt agreements at rate lower than market rate and which are not appointed to be measured at fair
value with their changes are accounted into current gain/loss accounts, are measured at the higher of the
followings: 1) Amount decided according to Enterprise Accounting Standard No.13 – Contingency issues; 2)
Balance of initially recognized amount less the accumulative amortizing amount accounted according to
Enterprise Accounting Standard No. 14 – Income.
Gain or loss from fluctuation of financial assets or liabilities are handled at the following ways, except for
relating to hedge instrument.
(1) Gain or loss from fluctuation of fair value of financial assets or liabilities and accounted into current gain/loss
account, are accounted into gain/loss of fluctuation of fair value. Interests or cash dividend received in the period
of holding these assets are recognized as investment gains. When they are disposed, the difference between the
amount actually received and initially booked value is recognized as investment gains, and adjust the gain/loss
from fair value fluctuation.
(2) Fluctuation of fair value of sellable financial assets accounted into capital reserves; interests gained at actual
interest rate are accounting into investment gains; the cash dividend received from sellable instrument investment,
are accounted into investment gains when distributed; At disposal of these investment, the difference between
actual amount received and book value are recognized as investment gains after deducting of accumulated
change of fair value which are originally accounted into capital reserves.
As soon as the contract rights of acquiring the cash flow of particular financial asset have been terminated or
almost all of the risks and rewards attached to the financial asset have been transferred, recognition of the
financial asset is terminated; as soon as the current liabilities attached to the financial liability have been
completely or partially relieved, recognition of the financial liability or part of is terminated.
3. Basis of recognition and accounting of financial asset transferring
The Company stop recognizing the finance asset which risks and remuneration of ownership are transferred to
the receiver; and continue to recognize the transferred finance asset which risks and remuneration of ownership
are kept, and recognize the value as one finance debt. For the finance assets which risks and remuneration of
ownership are not transferred or kept, the Company recognize them as following: (1) stop recognizing the
67
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
finance asset which are given up the control; (2) continue to recognize the finance asset and related finance debt
according to the extend which involved into the transferred finance asset for the finance asset which are not
given up control.
The Company measured the surplus between the following two values for the transferred finance assets which
fulfill the stop recognition requirements into current gain or loss: (1) Account value of the transferred finance
asset; (2) Consideration plus the accumulated fair value changes which were accounted directed into ownership
rights. For the transferred finance assets which partly fulfill the stop recognition requirements the Company
amortized the stopped recognition part and the not-stopped recognition part of the account value of the whole
transferred finance asset, and account the surplus between the following two values into current gain or loss: (1)
Account value of the stopped recognition part; (2) consideration plus the corresponding stopped recognition part
of the accumulated fair value changes which were accounted directed into ownership rights.
4. Recognition of fair value of financial assets and liabilities
The Company utilizes evaluation technologies supported by sufficient data and information to recognize the fair
values of financial assets and liabilities. Values inputted to the evaluation technology are divided into following
levels and used in sequence:
(1) Level 1 input: unadjusted quotations obtained from an active market of the similar asset or liability at the date
of measurement;
(2) Level 2 input: values of the asset or liability observable, directly or indirectly, other than level 1 input,
including: quotation of similar asset or liability in an active market; quotation of similar asset or liability in an
non-active market; other observable value other than quotations, i.e. observable interest or gain curves in normal
intervals of quotations.
(3) Level 3 input: non-observable input value of the asset or liability, including interest rates which are not
observable or not testified by observable market data, fluctuation of stock prices, future cash flow of disposal
liabilities undertaken from merger of entities, or financial predictions upon data itself.
5. Impairment test and impairment reserves plan
(1) The Company conduct impairment test to the finance asset other than which appointed to be measured at fair
value with their changes are accounted into current gain/loss accounts on balance sheet day. Impairment
provision is provided as long as evidence showing that impairment has happened to the financial asset.
(2) In dealing with major financial assets such as investment hold-to-mature, loans, and receivables, the
Company conduct independently impairment test for single finance asset. Impairment tests are conducted with
those of the finance asset composition which have similar credit risk characteristics; for the non impairment
assets which are tested independently, the Company conduct the impairment test with those of the finance asset
composition which have similar credit risk characteristics. The balance of book value over current value of
expected future cash flow is recognized as impairment loss.
(3) Objective evidences of impairment on sellable financial assets 1) Objective evidences supporting the
impairment of investment on sellable liability instruments are: a. Material financial dilemma with the debtor; b.
Violating of the contract by the debtor, e.g. overdue of payment for interests or principal; c. Compromise made to
the debtor who is in financial crisis with consideration of financial or legal factors; d. Possible bankruptcy or
financial restructuring of the debtor; e. The liability instrument is not able to be traded in an active market for the
debtor is in material financial dilemma; f. Other circumstances that are showing that impairment has already
occurred.
2) Objective evidence showing that impairment has already occurred on sellable equity instruments are:
significant or non-temporary fall of fair value, the invested entities suffers from material negative situations in
aspects of technical, market, economy, or legislation environment.
The Company performs tests on investments on sellable equity instruments individually on the balance sheet
day. For investment on equity instruments measured on fair value, if the fair value on the balance sheet day is
lower than the cost by 50% (included), or lower than the costs for successively 12 months (included), impairment
is recognized; If the fair value is lower than the cost by more than 20% (included), but higher than 50%, or lower
than the cost for successively 6 months (included) but not more than 12 months, the Company will determine if
impairment occurred with consideration of other factors, e.g. fluctuation of prices. For those equity instruments
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
on cost basis, the Company will decided about impairment with consideration of the invested entities’ situations
in aspects of technical, market, economy, or legislation environment.
When impairment occurred with a sellable financial asset, the accumulated losses caused by decreasing of fair
value which have originally been written into owners’ equity shall be carried over to current gain/loss account. If
practical evidence showing that the value of a particular financial asset has recovered in value after a impairment
loss has been recognized and practically related to the issues occurred after recognition of the loss, the
impairment loss recognized shall be restored and accounted into current gain/loss.
Impairment loss of sellable equity investment instrument will be restored to owners’ equity when the fair value
has increased afterward. When impairment occurs on sellable equity instrument on cost basis, the balance
between its book value and the current value of the predictable future cash flow upon current market gain rate, is
recognized as impairment loss and recorded to current gain/loss account. It will not be written back in subsequent
years.
10. Receivable accounts
(1) Recognition and providing of bad debt provision on individual receivable account with large amount
Basis of recognition or standard amount of
Accounts take over 10% of the book balance of receivable accounts
individual account with large amount
Impairment test performed individually, bad debt provision will be provided at
Basis of bad debt provision
the difference of expected cash flow lower than the book value.
(2)Recognition and providing basis of bad debt reserves for group of receivable accounts with similar
characteristics of credit risks
Name of the Group Basis of bad debt provision
Group by age analysis Age analysis method
The association unit within the scope of the merger is a credit ris
k feature that is matched against the income from the related tran Other
sactions.
Bad debt profisions are provided on age analyze basis in the protfolio
Rate of provision on other receivable
Age Rate of provision on receivable account
account
Within 1 year)included) 5.00% 5.00%
1－2 years 10.00% 10.00%
2－3 years 30.00% 30.00%
3－4 years 60.00% 60.00%
4－5 years 80.00% 80.00%
Over 5 years 100.00% 100.00%
Bad debt provisions are provided on percentage basis in the portfolio
Not applicable
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Bad debt provisions are provided on other basis in the portfolio
Not applicable
(3) Accounts receivable that are individually insignificant but with bad debt provision provided on an
individual basis
When there is significant difference between the current value of future cash flow of
Basis of providing bad debt individually
the receivable account and the current value of future cash flow of the group
Impairment test performed individually, bad debt provision will be provided at the
Basis of bad debt provision
difference of expected cash flow lower than the book value.
11.Inventories
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Inventory classification
Inventories include saleable finished goods or merchandise, product-in-process , consumption material and goods
in manufacturing procedure or working procedure.
(2) Pricing of inventory to be delivered
Delivered out materials are accounted by weighted average method, issued out finished products are accounted at
individual price.
(3) Recognition of realizable net value of inventory and providing of inventory impairment provision
At the balance sheet day, inventories are measured at the lower of costs and cashable net values, the individual
difference between the cashable net value and cost are provided as inventory impairment provision. For finished
product, merchandise, saleable material and other saleable merchandise inventory, their cashable net values are
recognized by their estimated sale price in normal operation deducting estimated sale expenses and related taxes;
for material inventory which need processing, it cashable net value are recognized by the estimated sale prices of
its finished products in normal operation deducting the estimated cost, sale expenses and related taxes due to the
end of processing; At the balance sheet day, for inventory item which part has contract price and part has no
contract price, the cashable net value is accounted separately, and recognize the inventory impairment provision
or returnable cash..
(4) Inventory system
Inventory system: perpetual inventory system
(5) Amortization of low-value consumables and packaging materials
1.Low price consumable
Basis of amortizing: one-off
2.Packaging materials
Basis of amortizing: one-off
12. Long-term equity investment
1. Recognition of common control and substantial influence
According to the contract, if the invested enterprise’s main finance and operation policy need to be agreed by the
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
other investing party, the investment is common control investment; if only have participating decision rights in
invested enterprise’s main finance and operation policy but have no own control or common control with other
investing part, the investment is investment with substantial influence.
2. Recognition of initial investment costs
(1) For the long-term equity investment formed by corporate merger under common control, if it is the long-term
equity investment obtained from the corporate merger by paying cash, transferring non-cash asset, bear liability
and issuing equity securities, the share of book value of owner's equity of the merged party on the merger date
shall be taken as the initial investment cost. The asset reserve is adjusted according to the difference between the
initial investment cost of long-term equity investment and the book value of paid combined consideration or
issued securities; if the capital is not enough for deduction, the remain earnings are adjusted.
Recognition of “one-off” trade when long-term equity investment is composed by merger of entities under
common control by multiple steps.
Transactions under an “one-off” trade are accounted as a common trade of ownership.
Transactions which are not “one-off” trades are recognized for their initial investment cost basing on the share of
book value of net asset in the consolidated financial statement of the entities acquired. Balance between the initial
investment cost and the book value of the long-term equity investment before merger and the premium paid for
the new shares after merger, is adjusted to capital reserves; when the capital reserve is not enough to offset,
retained profit shall be adjusted thereof.
(2) For the long-term equity investments formed by merger of enterprises under different control, the initial
investment cost is recognized by the fair value of combined consideration on purchasing day and related expenses.
Long-term equity investment formed by acquisition of entities under different control by trade in multiple stages
are accounted separately in the financial statements and consolidated financial statements.
1) In individual financial account, the sum of book value of original equity investment plus new investment cost is
recognized as the initial investment cost on cost basis.
2) Recognition of “one-off” trade in consolidated financial statements
Transactions under an “one-off” trade are accounted as a common trade of ownership. Transactions which are not
“one-off” trades are re-measured for their fair value at the day of acquisition. Balance between the fair value and
the book value of the long-term equity investment is adjusted to current investment gains; other gains from equity
on equity basis before the acquisition day are written over to current gains of at the day of acquisition, but not the
gains from re-calculating of changes in net liability or asset by the invested entity.
(3) Formed by means other than entity merger:
Acquired by cash payment – initial investment cost is the actual amount of payment;
Acquired by issuing of equity certificates – initial investment cost is the fair value of equity certificate issued;
Acquired by debtor restructuring – initial cost recognized as according to the Enterprise Accounting Standard
No.12 – Debtor restructuring;
Acquired by trading of non-monetary asset - initial cost recognized as according to the Enterprise Accounting
Standard No.7 – Trade of non-monetary assets;
3. Subsequent measurement and recognition of gain/loss
Cost basis is adopted in accounting of long-term equity investment in entities under substantial control of the
Company; while equity basis is adopted in accounting of investment in affiliates and joint-ventures.
4. Treatment of disposal of subsidiaries by stages till losing of control power
(1) Individual account
The difference between the book value and the actual purchase price of the disposed equity is recorded into the
current profit and loss. With regard to the remaining equity, which still has a significant impact on the invested
71
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
entity or exercises joint control with other parties, it shall be converted to equity accounting; if the entity under
investment can no longer be controlled, jointly controlled or significantly affected, it shall be recognized as a
financial asset, Accounting shall be carried out in accordance with the relevant provisions of Accounting
Standards for Enterprises No. 22-recognition and Measurement of Financial Instruments.
(2) Basis of Consolidated Financial Statements
1) Losing of controlling power on a subsidiary through disposal of equity by multiple trades, and not recognized
as “one-off” trade:
Before losing of control power, the balance of disposal consideration and the share of net asset attributable to the
Company on continued basis since purchasing or merger, is adjusted to capital reserves (capital premium),
whereas if the capital premium is not enough to offset the amount, retained profit will be offset at corresponding
amount.
At losing of control power over a former subsidiary, the retained equity shares shall be re-calculated according to
the fair value at the day of losing power. Sum of the consideration obtained from disposal and fair value of the
retained equity shares, less the share of net asset attributable to the Company on continued basis since purchasing
or merger, is accounted into investment gains of the period when the control power is disposed, and goodwill shall
be offset meanwhile. Other gains related to the equities in formal subsidiary shall be written over to current
investment gains at the period when control power was disposed.
2) Losing of controlling power on a subsidiary through disposal of equity by multiple trades, and recognized as
“one-off” trade:
The multiple trades are treated as one trade that causes losing of control power on a subsidiary. However, the
balance between the consideration received from each trade and corresponding share of net asset is recognized as
other gains in the consolidated accounts, and transferred collectively to gain/loss account of the period in which
the control power was lost.
13. Fixed assets
1. Conditions for fixed asset recognition
Fixed assets is defined as the tangible assets which are held for the purpose of producing goods, providing
services, lease or for operation & management, and have more than one year of service life. Fixed assets are
recognized at satisfying of great possibility of benefit inflow and costs are accountable.
2. Depreciation
Categories Basis of depreciation Depreciation age (year) Retain value rate Annual depreciation ratio
Straight average on
Houses & buildings 20-30 4 4.8-3.2
period
Straight average on
Equipment & machinery 8-15 4 12-6.4
period
Transportation Straight average on
4-8 4 24-12
equipment period
Straight average on
Office equipment 5 4 19.2
period
（3）Recognition basis, valuation and depreciation method for financing leased fixed assets
14. Construction in process
1. Construction in process is recognized on the basis of characteristics: very possible economic benefit flow in,
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
cost can be measured reliably. Since the date when the construction in process reaches its useful status as expected,
the construction in process is measured by the happened cost Since the date when the construction in process
reaches its useful status as expected.
2. When the construction in process reaches its useful status as expected, it is transferred into fixed asset at actual
cost. If the construction in process has reached useful status but with completion of project settlement process, it is
transferred to fixed asset at the value estimated, and adjustment will happen after completion of project settlement
process but no adjustment on depreciation provided previously.
15. Loan expenses
1. Capitalizing of loan expenses
Loan expenses occurred in the Company, which can be categorized to purchasing or construction of assets
satisfying the conditions of capitalization, shall be capitalized and accounted into capital costs; while other loan
expenses are recognized as expenses and recorded into current income account.
2. Capitalization period of loan expenses
(1) Capitalization started as soon as all of these conditions are satisfied: 1) Capital expenditures have occurred; 2)
Loan expenses have occurred; 3) Necessary purchasing or construction processes have been started to make the
asset usable or sellable.
(2) If irregular interruption occurred in the purchasing or construction process of the assets satisfying the
capitalizing conditions, and suspended for over successive three months, capitalizing of loan expenses is
suspended; loan expenses occurred during the suspension period are recognized as current expenses until the
purchasing or construction process resumes.
(3) Capitalizing of loan expenses is terminated as soon as the asset satisfying the capitalizing conditions reaches
the state of usable or sellable as expected.
3. Rates and amounts of loan expense capitalization
Special loans raised for purchasing or construction of assets satisfying the conditions of capitalization, interest to
be capitalized will be the actual interest expenses occurred in the current period of loan (including the discount,
premium, or amortizing decided on actual interest rate basis), less the interest income from the unused loans in
bank account or provisional investment gains; common loans used for purchasing or construction of assets
satisfying the conditions of capitalization, the interest to be capitalized will be the weighted average of balance
over special loans multiply capitalization rate of common loans.
16. Intangible assets
（1）Pricing Method, service life and impairment test
1. Intangible assets are land using rights, patents, and non-patent technologies, which are measured at cost basis.
2. For intangible assets with limited useful life, during the use life it is amortized according to the anticipating
implementation method of the economic benefit of the intangible asset systematically and reasonably. If can’t
recognize the anticipating implementation method, the straight basis is deployed.
Items Amortiing years
Land using right 50
Patent 5-20
Non- Patent technology 10
Software 5
(2) Accounting policy for internal research and development expenditure
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Expenditures of internal researching projects are accounted into current term gain and loss when happens. The
development period expenditures are recognized as intangible assets when fulfill following conditions: (1) The
intangible asset is completed and technically possible to be used or sold; (2) With intention to complete the
intangible asset for purpose of use or sale; (3) Evidence showing that there are markets or the products produced
with using of the intangible asset, or markets of the intangible asset itself, by which the intangible asset may
produce financial benefits. Intangible assets used inside the Company must be approved for their usable characters.
(4) Developing of the intangible assets are supported by sufficient technical, financial, and other resources, and
the intangible assets can be used or sold. (5) Expenditures occurred in developing of the intangible asset may be
reliably measured.
17. Impairment of partial long-term assets
For those long-term assets such as equity investment, fixed assets measured on cost basis, construction-in-process,
intangible assets with limited service life, their recoverable amount shall be evaluated as soon as there was
evidence indicating impairment at the balance sheet day. For intangible assets such as goodwill from merger or
intangible assets with uncertain service lives, impairment test is performed each year whatever there is evidence
of impairment or not. Impairment test on goodwill is performed on combination of related assets.
When the result of prediction shows that the recoverable amount is lower than its book value, the balance shall be
provided impairment provision and accounted into current gain/loss.
18. Long-term amortizable expenses
Long-term amortizable expenses which have been paid but with amortizing period over 1 year (not included).
Long-term amortizable expenses are recorded at actual amount occurred, and straight amortized to stipulated
periods. In case a long-term expense was not benefiting the succeeding periods, then the balance of the account
shall be transferred over to current income account.
19. Employees’ wage
1. Accounting of short-term wages
In the fiscal period when an employee is providing services, short-term wages actually occurred is recognized as
liability, and recorded into current gain/loss account or cost of related asset.
2.Accounting of stipulated beneficiary plan is on following steps:
1) On basis of expected accumulation of welfare, estimations on population variables and financial variables,
calculating of liabilities from stipulated beneficiary plan, and recognition of the period of related liabilities, are
performed on basis of non-bias and accordance actuary. Meanwhile, discount is performed on the liabilities from
stipulated beneficiary plan to recognize the current value and service cost of the liabilities from the stipulated
beneficiary plan.
2) When there is asset involved in the stipulated beneficiary asset, the deficit or premium from the balance of the
current value of liabilities of stipulated beneficiary plan over their fair values is recognized as its net liability or
net asset. When there is a premium with a stipulated beneficiary plan, the lower one between the premium and the
upper limit of the asset is recognized as the net asset of such stipulated beneficiary asset;
3) At end of period, employees’ wages from stipulated beneficiary plan are recognized by three parts including
service cost, net interest of net liability or net asset, and recalculated net asset or liability variation. The first two
are recorded into current gain/loss or related asset cost, the third is recorded to other gains, which will not be
written back to gain/loss in successive fiscal periods, but the amount can be transferred with the range of equity.
3. Accounting of dismissing welfare
Welfares for employees who are dismissed, the earlier one of the following is recognized as employee wage
liability, and recorded to current gain /loss:
(1) When the Company cannot, on its own call only, retrieve the dismissing welfare provided by dismissing of
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
service plan or suggestion;
(2) When the costs or expenses related to restructuring involved in the dismissing welfare are recognized by the
Company.
4. Accounting of other long-term employees’ welfares
As of long-term welfares provided to the employees, those which satisfy conditions of the stipulated saving plan
are treated according to related regulations of stipulated saving plan; those which other than the aforesaid, are
treated according to the stipulated beneficiary plan. In viewing of simplifying accounting treatment, employee
wage costs are recognized as service costs, the net amounts of interests of other long-term welfare net liability or
asset, along with recalculated variations of the both are recorded to the related gain/loss or cost of related asset.
20. Expected liabilities
(1) When it is very much likely to cause economic interests which can be reliably calculated outflow from
the company to fulfill the obligation which is due to giving security outside, contentious matter, quality
guarantee of products, onerous contract and other contingency, the company will regard the obligation as
anticipation liabilities.
(2) The company will make an initial measurement of anticipation liabilities according to needed expense
of best estimation when fulfilling related obligations and check the book value of anticipation liabilities on the
balance sheet date.
21.Revenue
Whether the company needs to comply with the disclosure requirements of the particular industry
No
1. Recognizing of revenue
(1) Sales of goods
Sales income is recognized when all of these conditions are satisfied: (1) Major risks and rewards attached to the
goods have been transferred to the purchaser; (2) The Company holds neither successive management power
which is normally attached to ownership, nor effective control, over the goods which have been sold out; (4)
Amount of income may be reliably measured; (5) when the costs, occurred or will occur, may be measured
reliably.
(2) Providing of services
At balance sheet day, those service trades (simultaneously satisfying the requirements of those: income can be
measured reliably, related economic benefit will flow in very possibly, transaction procedure can be confirmed
reliably, happened and happening cost can be measured reliably) which can be reliably estimated are recognized
at the percentage of completion, and progress of completion of service is decided by the portion of costs occurred
over the estimated total costs. At balance sheet day, those service trades which can not be reliably estimated, if the
happened services cost will be compensated, the services income are recognized according to happened service
cost and transited to service cost according to same amount; if the happened services cost will not be compensated,
the happened services cost are accounted into current term’s gain or loss and the services income will not be
recognized.
(3) Giving of asset using rights
Income from giving of assets is recognized when satisfying requirements: related economic benefit flows in very
possibly, income can be measured reliably. Amount of interest income is calculated according to the time and
actual interest rate of the monetary capital is used by other party. Income of using fee is calculated upon the
charge period and calculation provided by the related contract or agreement.
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
(4) Construction contracts
1) When the result of the construction contract is able to be evaluated reliably at the balance sheet date, the
income and cost of the contract are recognized on completion percentage basis. If the result of the construction
contract is not able to be evaluated reliably, but the contract cost may be recovered, the income is recognized at
the cost actually recovered, and the cost of the contract is recognized as contract expenses of the current period
when it is occurred.
2) When all of the following conditions were satisfied, the result of a fix-amount contract is regarded as can be
evaluated reliably: the total income of the contract may be measured reliably, there is great possibility that the
financial benefit in relation with the contract will inflow, the actual contract costs may be identified and measured
clearly and reliably, the construction progress and the cost to occur are able to be measured reliably. When all of
the following conditions are satisfied, the result of a cost-plus-commission contract is regarded as can be
evaluated reliably: there is great possibility that the financial benefit in relation with the contract will inflow, the
actual costs may be identified and measured clearly and reliably.
3) Contract progress is recognized at the ratio of accumulative actual cost on the predicted complete cost.
4) In case the expected total cost is greater than the total income, the expected loss will be recognized as expense
of the current period. If the construction is in process, the balance is accounted as inventory impairment provision;
if the contract is not executed, the balance is accounted as expected liability.
2. Practical basis for recognition of revenue
Particular methods for recognition of revenue. The Company is mainly engaged in designing, manufacturing,
sales, and service of steam turbines and gas turbines falling in the range of rotating and reciprocating machinery,
and parts. Recognition of sales in the country shall satisfy: products had been delivered to the buyer and the
amount had been fixed. Payment was received or documents received with great possibility of cash inflow. And
the cost of the products is able to be measured appropriately. Recognition of sales outside the country shall satisfy:
The goods had been filed by the custom with bill of lading obtained. The amount had been fixed, and payment
was received or documents received with great possibility of cash inflow. And the cost of the products is able to
be measured appropriately.
22. Government subsidy
1. Recognition basis and accounting of asset-related government subsidy
Government subsidies to the Company for purchasing or acquiring by other means of long-term asset are
asset-related government subsidies. For government subsidies related to assets, the book value of the relevant
assets is deducted or the deferred income is recognized. Where such subsidies are recognized as deferred income,
the relevant assets shall, within the useful life of the relevant assets, be reasonably recognized, The method of the
system shall be recorded into profit and loss by stages. The government subsidy measured according to the
nominal amount shall be directly accounted for in the profits and losses of the current period. Where the relevant
assets are sold, transferred, scrapped or damaged before the end of their useful life, Transfer the undistributed
balance of deferred income to the current profit or loss of asset disposal.
2. Recognition basis and accounting of income-related government subsidy
A government subsidy other than an asset-related government subsidy is divided into profit-related government
subsidies. It is difficult to distinguish between asset-related and revenue-related government subsidies that include
both asset-related and revenue-related components. Overall classification as government subvention related to
income.Than asset-related subsidies are recognized as income-related government subsidies. Those, which are
used to cover costs or losses in subsequent periods, are recognized as deferred income and accounted to current
gain/loss to the periods of related expenses. Those, which are used to makeup expenses or losses already occurred,
are recorded to current gain/loss account.
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
23. Deferred income tax assets/ deferred income tax liabilities
1. Deferred income tax liabilities or assets are recognized at proper rate in the term of retrieving the assets or
paying the liabilities according to difference (for not recognized assets and liabilities which tax basis can be
recognized, the difference is between the tax basis and the book value) between book value of the assets or
liabilities and the tax basis.
2. Deferred income tax assets are recognized limitedly by the income tax which very possibly deduct deductible
temporary difference. At balance sheet day, the not-yet recognized deferred income tax assets in previous fiscal
term are recognized if have evidence to prove there is enough income tax very possibly to deduct deductible
temporary difference.
3. At the balance sheet day, verification will be performed on the book value of differed income tax assets. If it is
not possible to obtain enough taxable income to neutralize the benefit of differed income tax assets, then the book
value of the differed income tax assets shall be reduced. Whenever obtaining of taxable income became possible,
the reduced amount shall be restored.
4. Current income tax and differed income tax are accounted into current gain/loss account as income tax
expenditures or gains, but exclude the following income taxes: (1) Merger of enterprises; (2) Transactions or
events recognized directly in owners’ equity.
24. Lease
(1)Accounting of operational lease
When the Company is the leasee, the amount is recorded to asset cost or recognized as gain/loss of current period
on straight basis to the periods of lease. Initial direct expenses are accounted into current gain/loss. Contingent
rentals are recorded to current gain/loss at actual occurrence.
When the Company is the leaser, the amount is recorded to current gain/loss at straight basis to the periods of
lease. Initial direct expenses are recorded to current gain/loss other than those with greater amount which are
capitalized and recorded to gain/loss of different periods. Contingent rentals are recorded to current gain/loss at
actual occurrence.
(2) Accounting Method for Financing Leases
VI. Taxation
1. Main categories and rates of taxes
Category of taxes Tax base Tax rate
VAT Sales of goods or providing of taxable labor service 17%
City maintenance and
Turnover tax payable 5%、7%
construction tax
Enterprise income tax Amount of income taxable 15%、25%
Educational surcharge Turnover tax payable 3%
Local education additional Turnover tax payable 2%
For those on price basis, taxes are paid at 1.2% of the balance of
House tax 1.2%、12%
original value of the property after deducting of 30%; for those on
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
rental basis, taxes are paid at 12% of the rental.
Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rate
Name Income tax rate
The Company , Zhongneng Company, Packaged Tech. Company,Casting
Company, Zhejiang Huayuan Steam Turbine Machinery Co.,Ltd. and 15%
Hangzhou Guoneng Steam Turbine Engineering Co.,Ltd.
Hangzhou Zhongneng Steam Turbine Power (Indonesia)
Hangzhou Zhongneng Steam Turbine Power (Indonesia) Co., Ltd. Co., Ltd. registered in Indonesia overseas subsidiaries,
the applicable local relevant tax laws and regulations.
Other Subsidiary（Domestic） 25%
2. Preferential tax
1. According to the document “Notice for Qualification of High-tech Enterprises” (GKHZD〔2017〕No.201) issued
by Department of Science and Technology High-tech Development Center, the Company along with Hangzhou
Zhongneng Steam Turbine Power Co., Ltd. ,Zhejiang Packaged Technologies Development Co., Ltd., Zhejiang
Huayuan Steam Turbine Machinery Co.,Ltd. and Hangzhou Guoneng Steam Turbine Engineering Co.,Ltd. –
subsidies of the Company, were qualified as high-tech enterprises for term of three years. Therefore they enjoy
15% of tax for 2018.
2. According to the document “Notice for Qualification of High-tech Enterprises” (GKHZD〔2016〕No.149) issued
by Department of Science and Technology High-tech Development Center, Hangzhou Steam Turbine Casting Co.,
Ltd– subsidies of the Company, were qualified as high-tech enterprises for term of three years. Therefore they
enjoy 15% of tax for 2018.
VII. Notes to the Consolidated Financial Statements
1.Monetary Capital
In RMB
Items End of term Beginning of term
Cash in stock 292,307.47 208,763.32
Bank deposit 1,154,962,279.99 1,137,284,071.51
Other monetary fund 75,549,211.33 85,184,661.11
Total 1,230,803,798.79 1,222,677,495.94
Incl:Total of accounts saved overseas 3,189,107.76 3,770,731.56
Other notes：
Other monetary fund composes of security for bank acceptance notes RMB72,546,674.32 of security for Letter of
credit, RMB3,002,537.01 of security for bank guarantee letter. Both under limitation of using.
78
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
2. Note receivable
(1) Notes receivable listed by category
In RMB
Items End of term Beginning of term
Bank acceptance 652,694,237.50 691,199,387.68
Commercial acceptance 48,571,600.00 24,211,500.00
Total 701,265,837.50 715,410,887.68
(2) Notes receivable pledged by the Company at the period-end
In RMB
Items Amount on pledge
Bank acceptance 75,967,299.36
Total 75,967,299.36
（3）Notes receivable which had endorsed by the Company or had discounted and had not due on the balance
sheet date at the period-end
In RMB
Amount of recognition termination at the Amount of not terminated recognition at
Items
period-end the preriod -end
Bank acceptance 430,026,029.34
Total 430,026,029.34
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
3. Account receivable
（1）Detailed categories
In RMB
End of term Beginning of term
Book balance Bad debt provision Book balance Bad debt provision
Category
Proportion Proportion Book value Proportion Proportion Book value
Amount Amount Amount Amount
% % % %
Receivables
provided bad debt
2,963,220,900.54 99.00% 1,041,426,342.10 35.15% 1,921,794,558.44 2,695,568,129.24 98.91% 1,000,350,680.78 37.11% 1,695,217,448.46
provision in credit
risk groups
Account receivable
with Not minor
individual amount
29,819,607.69 1.00% 29,819,607.69 100.00% 0.00 29,819,607.69 1.09% 29,819,607.69 100.00% 0.00
but bad debt
provision is
provided
Total 2,993,040,508.23 100.00% 1,071,245,949.79 35.79% 1,921,794,558.44 2,725,387,736.93 100.00% 1,030,170,288.47 37.80% 1,695,217,448.46
Receivables with individually significant amount and provision for bad and doubtful debts individually provided at the end of the reporting period.
Not applicable
Receivable accounts in the group on which bad debt provisions are provided on age basis
In RMB
End of term
Aging
Other receivable account Bad debt provision Proportion%
Subitem within 1 year
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Subtotal within 1 year 1,081,392,109.64 54,070,528.36 5.00%
1-2 years 536,639,764.54 53,663,976.46 10.00%
2-3 years 356,535,233.92 106,960,570.18 30.00%
Over 3 years 988,653,792.44 826,731,267.10
3-4 years 275,010,159.67 165,006,095.81 60.00%
4-5 years 259,592,306.95 207,673,845.48 80.00%
Over 5 years 454,051,325.82 454,051,325.81 100.00%
Total 2,963,220,900.54 1,041,426,342.10 35.15%
81
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Receivables with provision for bad and doubtful debts based on the balance percentage method in the portfolio
Not applicable
Receivables with provision for bad and doubtful debts based on the other method in the portfolio
（2）Accrual period, recovery or reversal of bad debts situation
The current amount of provision for bad debts is RMB43,787,254.88; recovery or payback for bad debts Amount
is RMB0.00.
(3) Receivable accounts actually written off in the report period
In RMB
Items Amount
Uncollectible amount 2,711,593.56
The significant actual write-off accounts receivable:
In RMB
Arising from
Nature of
Amount written Reason for related
Name account Verification procedures
off written-off transactions(Y/
receivable
N)
Uncollectible The examined and adopted to
MITSUBISHI HEAVY INDUSTRIES LTD Goods 817,453.00 No
amount Board of directors
Dalian Fujia, Dahua Petrochemical Co., Uncollectible The examined and adopted to
Goods 600,000.00 No
Ltd. amount Board of directors
Uncollectible The examined and adopted to
Zhejiang Xiuzhou Paper Co., Ltd. Goods 450,000.00 No
amount Board of directors
Huainan Pingwei No.3 Power Generation Uncollectible The examined and adopted to
Goods 300,000.00 No
Co., Ltd. amount Board of directors
Shanghai Yunneng Energy Technology Co., Uncollectible The examined and adopted to
Goods 224,000.00 No
Ltd. amount Board of directors
Uncollectible The examined and adopted to
Huaihu coal power Co., Ltd. Goods 153,000.00 No
amount Board of directors
Uncollectible The examined and adopted to
Other Goods 167,140.56 No
amount Board of directors
Total -- 2,711,593.56 -- -- --
82
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
（4）The ending balance of account receivables owed by the imputation of the top five parties
Name Amount Proportion(%) Bad debt provision
Client 1 631,855,450.92 21.11% 291,935,614.87
Client 2 284,014,771.02 9.49% 188,809,322.02
Client 3 79,995,000.00 2.67% 3,999,750.00
Client 4 52,105,337.00 1.74% 26,187,379.50
Client 5 44,590,545.99 1.49% 11,523,045.79
Subtotal 1,092,561,104.93 36.50% 522,455,112.18
（5）Account receivable which terminate the recognition owning to the transfer of the financial assets
(6)The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts
receivable
Other notes：
4. Prepayments
（1）Age analysis
In RMB
Balance in year-end Balance in year-begin
Age
Book balance Proportion(%) Book balance Proportion(%)
Within 1 year 384,475,837.47 90.60% 414,480,174.64 92.90%
1-2 years 11,614,871.39 2.74% 10,312,288.25 2.31%
2-3 years 9,447,411.67 2.23% 4,033,538.38 0.90%
Over 3 years 18,837,922.90 4.44% 17,340,709.50 3.89%
Total 424,376,043.43 -- 446,166,710.77 --
Notes：
(2) Top 5 of the closing balance of the prepayment colleted according to the prepayment target
Name Amount Proportion(%)
Hangzhou Hangfa generation Equipment Co., ltd. 53,956,785.00 12.71%
Siemens Industrial Turbomachinery AB 37,418,877.59 8.82%
83
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Jinling International Co., Ltd. 22,736,238.69 5.36%
Jiangsu Yuanneng Environmental protection Engineering Co., Ltd. 21,466,112.86 5.06%
PORMOSA ELECTRIC POWER SYSTEM CO.,LIMITED 18,695,364.07 4.41%
Subtotal 154,128,418.21 36.32%
5.Dividend receivable
（1）Dividend receivabl
In RMB
Items Balance in year-end Balance in year-begin
Hangzhou Bank 6,900,000.00 6,900,000.00
Total 6,900,000.00 6,900,000.00
84
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
6. Other account receivable
1) Detailed categories
In RMB
End of term Beginning of term
Book balance Bad debt provision Book balance Bad debt provision
Category
Proportion Proportion Book value Proportion Proportion Book value
Amount Amount Amount Amount
% % % %
Other Accounts receivable
portfolio subject to 32,162,574.47 100.00% 12,002,119.23 37.32% 20,160,455.24 28,165,573.86 87.57% 11,260,568.29 39.98% 16,905,005.57
impairment by credit risk
Total 32,162,574.47 100.00% 12,002,119.23 37.32% 20,160,455.24 28,165,573.86 87.57% 11,260,568.29 39.98% 16,905,005.57
Other Receivable accounts with large amount individually and bad debt provisions were provided
Not applicable
Other receivable accounts in the group on which bad debt provisions are provided on age basis
In RMB
Closing balance
Aging
Other receivable Bad debt provision Proportion
Subitem within 1 year
Subtotal within 1 year 13,578,483.49 678,924.17 5.00%
1-2 years 3,422,796.29 342,279.62 10.00%
2-3 years 3,021,433.85 906,430.16 30.00%
Over 3 years 12,139,860.84 10,074,485.28
3-4 years 2,758,357.90 1,655,014.74 60.00%
85
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
4-5 years 4,810,162.00 3,848,129.60 80.00%
Over 5 years 4,571,340.94 4,571,340.94 100.00%
Total 32,162,574.47 12,002,119.23 37.32%
86
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Notes ：
Other receivable account in Group on which bad debt provisions were provided on percentage basis：
Not applicable
Other Receivable accounts on which bad debt provisions are provided by other ways in the portfolio：
Not applicable
（2）Accrual period, recovery or reversal of bad debts situation
The current amount of provision for bad debts is RMB741,550.94 ; recovery or payback for bad debts Amount is
RMB0.00.
(3) Other accounts receivable classified by the nature of accounts
In RMB
Nature Closing book balance Opening book balance
Export tax rebate receivable 1,477,276.50 465,230.69
Deposit 13,682,960.41 16,917,313.03
Provisional payment receivable 10,433,857.18 5,232,037.20
Petty cash 4,649,410.66 2,803,540.63
Other 1,919,069.72 2,747,452.31
Total 32,162,574.47 28,165,573.86
(4) Top 5 of the closing balance of Other accounts receivable
In RMB
Account Percentage in total other Bad debt
Name of the company Book balance Age
property receivable % provision
Over 5
Shanghai Customs Waigaoqiao Office Deposit 3,710,320.94 years 11.54% 3,710,320.94
Return of investment funds due from Indonesian
companies Investment 3,267,100.00 4-5 years 10.16% 2,613,680.00
Within 1
China Electric Power Complete Equipment Co., Ltd. Deposit 1,651,000.00 year 5.13% 82,550.00
Guoxin Bidding Group Co., Ltd. Deposit 800,000.00 2-3 years 2.49% 240,000.00
Jiangxi Baohuashan Group Ningdu Hengfeng Mining
& Metallurgical Co., Ltd. Deposit 650,000.00 4-5 years 2.02% 520,000.00
Total -- 10,078,420.94 -- 31.34% 7,166,550.94
87
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
7. Inventories
(1) Details
In RMB
End of term Beginning of term
Items
Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Raw
599,161,567.72 309,803.19 598,851,764.53 522,590,238.59 309,803.19 522,280,435.40
materials
Product in
523,675,752.51 15,617,324.99 508,058,427.52 584,647,307.67 15,617,324.99 569,029,982.68
process
Products in
1,045,272,624.90 96,557,477.34 948,715,147.56 1,098,811,798.77 97,546,524.93 1,001,265,273.84
stock
Total 2,168,109,945.13 112,484,605.52 2,055,625,339.61 2,206,049,345.03 113,473,653.11 2,092,575,691.92
Whether the company is required to comply with the "Shenzhen Stock Exchange Industry Information
Disclosure Guidelines No. 4 - listed companies engaged in seed industry, planting business" disclosure
requirements
No
(2) Inventory depreciation provision
In RMB
Increased this period Decreased this period
Items Beginning of term Written back or End of term
Provided Others Other
off
Raw materials 309,803.19 309,803.19
Product in process
15,617,324.99 15,617,324.99
Products in stock 97,546,524.93 989,047.59 96,557,477.34
Total 113,473,653.11 989,047.59 112,484,605.52
At the end of the period, for the finished products which are directly to be sold and the raw materials that need
further process, the estimated selling price of the finished products after the completion of the production reduces
the expected cost incurring at the time of completion, the estimated selling expenses and the relevant taxes and
fees, which determines the amount of net realizable value. According to the balance between the net realizable
value and the cost of single inventory, the inventory depreciation reserve is extracted. The reduction of the
inventory depreciation reserve for the current period is RMB 989,047.59, which is the provision for the
inventory depreciation reserve due to the use or sale of inventory.
（3）Statement of the capitalized amount of the borrowing costs included in the end of the inventory balance
Nil
88
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
(4) Assets unsettled formed by construction contract which has completed at period-end
In RMB
Items Amount
Other notes：
8. Other current asset
In RMB
Items End of term Beginning of term
Bank financing products[Notes] 1,309,670,000.00 886,732,329.00
Input tax deductible 18,883,903.69 16,473,990.55
To verify the input tax 120,603.72 261,538.46
Prepaid income tax 0.00 354,357.59
Prepayment of other tax 3,140,845.90
Rent charge 451,369.84 604,050.19
Total 1,332,266,723.15 904,426,265.79
Other notes:
Notes: Financial products are financial products and trust financial products, are in non-guaranteed
floating-income short-term (or short-term redeemable) financial products, and no active market price.
9. Available-for-sale financial assets
(1) Available-for-sale financial assets
In RMB
End of term Beginning of term
Impair
Items Impairment
Book balance ment Book value Book balance Book value
provision
provisi
on
Available-for-sale
2,248,334,490.64 2,248,334,490.64 2,417,780,984.08 2,417,780,984.08
equity instruments
Including ：
2,153,640,027.84 2,153,640,027.84 2,239,086,521.28 2,239,086,521.28
Measured by fair value
Measured by cost 94,694,462.80 94,694,462.80 178,694,462.80 178,694,462.80
Total 2,248,334,490.64 2,248,334,490.64 2,417,780,984.08 2,417,780,984.08
(2) Available-for-sale financial assets measured by vair value at the period-end
89
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
In RMB
Available-for-sale equity instrumentsAvailable-for –sale
Type Liabilities Total
instruments
Vair value 2,153,640,027.84 2,153,640,027.84
90
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
(3)Available-for-sale financial assets measured by cost at the period-end
I n RMB
Book balance Impairment provision
Investee Increa Decreas Period-e Proportion Current cash dividend
Period-begin Increase Decrease Period-end Period-begin
se e nd
Hangzhou Jushi Investment Partnership
100,000,000.00 100,000,000.00 82.64% 10,428,418.13
（Limited partnership）
Hangzhou Steam Turbine Engineering Co., Ltd. 30,000,000.00 30,000,000.00 15.00%
Wuxi Xinchang Steel Bube Co., ltd. 15,159,689.58 15,159,689.58 18.00%
Zhejiang Zhongkong Solar Energy Technology
15,000,000.00 15,000,000.00 3.84%
Co., Ltd.
Zhejiang Tianhang Steam Turbine Auxiliary
10,000,000.00 10,000,000.00 33.33% 1,000,000.00
Machinery Co., Ltd.
Greenesolpower systems PVT Ltd. 5,534,773.22 5,534,773.22 37.00%
Zhejiang Hangzhou Steam Turbine Gas turbine
2,400,000.00 2,400,000.00 48.00%
machinery innovation center
Zhejiang Sanxin Automation Engineering Co.,
600,000.00 600,000.00 6.00%
Ltd.
Juyuan Xinxing No.9 private equity fund
16,000,000.00 16,000,000.00 20%
raising special account
Total 178,694,462.80 16,000,000.00 100,000,000.00 94,694,462.80 -- 11,428,418.13
10. Long-term equity investments
In RMB
Increase /decrease
Closing balance
Addition Decrea Investment gains Adjustment of Cash bonus or Withdrawal of
Investees Opening balance Changes of Closing balance of impairment
al se and losses other profits announced impairment Other
other equity provision
investme invest recognized under comprehensive to issue provision
91
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
nt ment the equity method income
I. Joint venture
2. Affiliated Company
Zhejiang Zhongrun Gas turbine
5,800,000.00 5,800,000.00
technology Co., Ltd.
Subtotal 5,800,000.00 5,800,000.00
Total 5,800,000.00 5,800,000.00
Other notes
92
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
11. Fixed assets
(1) Details
In RMB
Transportation
Items Houses & buildings Machinery equipment Office equipment Total
equipment
I. Original price
1. Balance at period-beginning 463,997,001.86 1,002,701,532.72 28,655,573.48 98,322,465.88 1,593,676,573.94
2.Increase in the current
2,465,568.39 5,368,002.77 60,917.21 638,091.04 8,532,579.41
period
(1) Purchase 2,271,842.26 60,917.21 405,947.46 2,738,706.93
（ 2 ）
Transferred from construction 2,465,568.39 3,096,160.51 232,143.58 5,793,872.48
in progress
(3)Increased of Enterprise
Combination
3.Decreased amount of the
13,560.00 9,072.00 22,632.00
period
（1）Dispose 13,560.00 9,072.00 22,632.00
4. Balance at period-end 466,462,570.25 1,008,055,975.49 28,716,490.69 98,951,484.92 1,602,186,521.35
II.Accumulated amortization
1.Opening balance 190,878,065.10 725,830,773.54 20,917,542.82 82,687,283.71 1,020,313,665.17
2.Increased amount ofthe
6,819,489.37 26,271,420.10 284,743.29 1,289,542.37 34,665,195.13
period
(1) Withdrawal 6,819,489.37 26,271,420.10 284,743.29 1,289,542.37 34,665,195.13
3.Decrease in the reporting
10,528.92 8,618.40 19,147.32
period
（1）Disposal 10,528.92 8,618.40 19,147.32
4.Closing balance 197,697,554.47 752,091,664.72 21,202,286.11 83,968,207.68 1,054,959,712.98
III. Impairment provision
1.Opening balance 1,504,928.24 4,033,520.42 1,113,523.01 6,651,971.67
2.Increase in the reporting
93
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
period
（1）Withdrawl
3.Decrease the reporting
period
（1）Disposal
4. Closing balance 1,504,928.24 4,033,520.42 0.00 1,113,523.01 6,651,971.67
IV. Book value
1.Book value ofthe period-end 267,260,087.54 251,930,790.35 7,514,204.58 13,869,754.23 540,574,836.70
2.Book value of the
271,614,008.52 272,837,238.76 7,738,030.66 14,521,659.16 566,710,937.10
period-begin
94
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
12. Construction in process
（1）Details
In RMB
End of term Beginning of term
Impairm Impairm
Items ent ent
Boook balance Book value Boook balance Book value
provisio provisio
n n
Construction in process of
178,108,830.71 178,108,830.71 151,569,540.89 151,569,540.89
parent Company
Project of steam turbine heavy
218,785,815.97 218,785,815.97 99,071,621.77 99,071,621.77
industry
Casting company networking
1,213,675.18 1,213,675.18
system project
other project 3,249,037.10 3,249,037.10 3,285,135.25 3,285,135.25
Prepayment for equipment or
781,687.00 781,687.00
projects
Total 400,143,683.78 400,143,683.78 255,921,660.09 255,921,660.09
(2)Changes of significant construction in progress
95
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
In RMB
Includin
g:
Capitaliz
Capitaliz capitaliz Source
Transferred to Proporti Project ation of
Name of project Budget Opening balance Increase Other decrease End balance ation of ation of of
fixed assets on % process interest
interest interest funding
rate (%)
this
period
Construction in Under
process of parent 242,750,000.00 146,986,520.91 31,122,309.80 178,108,830.71 73.37% Constructi
Company on
Completed project
4,604,800.00 4,583,019.98 21,874.36 4,604,894.34 100.00% Completed
of parent Company
Project of steam Under
turbine heavy 1,794,100,000.00 99,071,621.77 119,714,194.20 218,785,815.97 12.19% Constructi 2,953,841.62 1,049,151.21 1.20%
industry on
Casting company
networking system 2,411,300.00 1,213,675.18 489,783.64 519,698.14 1,183,760.68 0.00 100.00% Completed
project II
other project 3,285,135.25 36,098.15 3,249,037.10
Prepayment for
equipment or 781,687.00 669,280.00 112,407.00
projects
Total 2,043,866,100.00 255,921,660.09 151,348,162.00 5,793,872.48 1,332,265.83 400,143,683.78 -- -- 2,953,841.62 1,049,151.21 --
96
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
13 Intangible assets
（1）Details
In RMB
Non patent
Items Landusing right Patent Software Total
technology
I. Original price
1. Balance at
332,298,312.33 309,433.96 0.00 1,979,342.11 334,587,088.40
period-beginning
2.Increase in the current
1,260,683.76 1,260,683.76
period
(1) Purchase 76,923.08 76,923.08
(2)Internal Development
(3)Increased of Enterprise
Combination
(4)Transfer of construction
1,183,760.68 1,183,760.68
in progress
3.Decreased amount of the
period
（1）Disposal
4.Closing balance 332,298,312.33 309,433.96 0.00 3,240,025.87 335,847,772.16
II.Accumulated amortization
1.Opening balance 48,444,955.34 242,000.00 0.00 229,494.51 48,916,449.85
2.Increased amount of the
3,332,412.84 13,205.35 0.00 204,227.65 3,549,845.84
period
(1) Withdrawal 3,332,412.84 13,205.35 0.00 204,227.65 3,549,845.84
3.Decreased amount of the
period
（1）Disposal
4.Closing balance 51,777,368.18 255,205.35 0.00 433,722.16 52,466,295.69
III. Impairment provision
97
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
1.Opening balance
2.Increased amount of the
period
(1) Withdrawal
3.Decreased amount of the
period
（1）Disposal
4.Closing balance
IV. Book value
1.Closing book value 280,520,944.15 54,228.61 0.00 2,806,303.71 283,381,476.47
2.Opening book value 283,853,356.99 67,433.96 0.00 1,749,847.60 285,670,638.55
The intangible assets by the end of the formation of the company's internal R & D accounted for 0.00% of the
proportion of the balance of intangible assets
14 Long-term amortize expenses
In RMB
Amortized expenses
Balance in Increase in this
Items year-begin period Other loss Balance in year-end
Redecoration 253,886.90 126,943.44 126,943.46
Total 253,886.90 126,943.44 126,943.46
15. Deferred income tax assets/deferred income tax liabilities Other notes
(1) Deferred income tax assets had not been off-set
In RMB
Balance in year-end Balance in year-begin
Items Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Provision for Asset Impairment 1,202,077,998.25 186,239,699.56 1,160,614,665.91 179,875,205.01
Internal trade profit not realized
44,109,190.82 7,276,503.76 68,494,522.27 10,934,321.24
Deductible loss 0.00 0.00 46,151,636.66 6,922,745.50
Temporary difference such as 2,981,985.19 447,297.78 2,981,985.19 447,297.78
98
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
amortizing of software expense
Total 1,249,169,174.26 193,963,501.10 1,278,242,810.03 198,179,569.53
(2) Deferred income tax liabilities had not been off-set
In RMB
Balance in year-end Balance in year-begin
Items Deferred income tax Deductible temporary Deferred income tax
Deductible temporary difference
liabilities difference liabilities
Changes in fair value of
1,762,685,987.84 264,402,898.17 1,848,132,481.28 277,219,872.19
tradable financial assets
Accumulated depreciation 6,651,971.67 997,795.75 6,651,971.67 997,795.75
Total 1,769,337,959.51 265,400,693.92 1,854,784,452.95 278,217,667.94
（3）Deferred income tax assets and liabilities are presented as net amount after neutralization
In RMB
Deferred Income Tax
Deferred Income Tax Assets Temporarily Deductable or Temporarily Deductable or
Assets or Liabilities at the
Items or Liabilities at the End of Taxable Difference at the End of Taxable Difference at the
Beginning of Report
Report Period Report Period Beginning of Report Period
Period
Deferred income tax
193,963,501.10 198,179,569.53
assets
Deferred income tax
265,400,693.92 278,217,667.94
liabilities
(4)Details of income tax assets not recognized
In RMB
Items End of term Beginning of term
Deductible provisional differences 950,344.94 941,815.63
Deductible losses 11,371,541.93 9,998,963.52
Total 12,321,886.87 10,940,779.15
(5) The un-recognized deductible losses of deferred income tax assets will due in the following years:
In RMB
Year End of term Beginning of term Remark
2020 579,693.92 579,693.92
2021 712,938.27 712,938.27
99
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
2022 8,706,331.33 8,706,331.33
2023 1,372,578.41
Total 11,371,541.93 9,998,963.52 --
Other notes：
16. Short-term loan
（1）Categories of short-term loans
In RMB
Items End of term Beginning of term
Mortgage loan 102,000,000.00 96,500,000.00
Guarantee loan 38,000,000.00 19,000,000.00
Total 140,000,000.00 115,500,000.00
Notes：
17. Note payable
In RMB
Items End of term Beginning of term
Bank acceptance bill 264,683,667.48 215,409,958.92
Total 264,683,667.48 215,409,958.92
Amount due in next fiscal period is RMB 0.00.
18. Account payable
（1）Category of Account payable
In RMB
Items End of term Beginning of term
Goods 1,056,441,612.06 860,669,728.38
Equipment and projects 12,650,372.81 22,045,737.27
Total 1,069,091,984.87 882,715,465.65
19. Advances received
（1）Category of Advances received
In RMB
Items End of term Beginning of term
Goods 2,600,249,461.40 2,419,751,405.08
Total 2,600,249,461.40 2,419,751,405.08
100
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
20. Employees’ wage payable
(1) Details
In RMB
Items Beginning of term Increased this period Decreased this period End of term
I. Short-term wages 56,866,150.56 335,009,613.85 328,178,588.22 63,697,176.19
II. Welfare after leaving of position-fixed
22,659,623.13 39,750,249.06 31,810,814.13 30,599,058.06
provision scheme
Total 79,525,773.69 374,759,862.91 359,989,402.35 94,296,234.25
(2) Details of short term wages
In RMB
Items Beginning of term Increased this period Decreased this period End of term
1.Wage, bonus, allowance and subsidies 43,714,190.74 245,974,091.84 259,690,332.83 29,997,949.75
2. Employee welfare 0.00 27,390,774.98 12,153,666.01 15,237,108.97
3. Social insurance 5,917,986.13 25,077,763.28 24,821,498.67 6,174,250.74
Incl. Medical insurance 5,505,850.79 21,624,716.74 21,454,308.49 5,676,259.04
Labor injury insurance
122,710.40 1,113,246.37 1,074,163.17 161,793.60
Maternity insurance 289,424.94 2,339,800.17 2,293,027.01 336,198.10
4. Housing fund 113,749.96 23,579,287.00 23,580,158.00 112,878.96
5. Labour union fee and employee
7,120,223.73 10,280,698.35 5,225,934.31 12,174,987.77
education fee
Total 56,866,150.56 335,009,613.85 328,178,588.22 63,697,176.19
(3) Details of fixed provision scheme
In RMB
Items Beginning of term Increased this period Decreased this period End of term
1.Basic pension
3,985,531.76 28,139,108.06 28,187,357.24 3,937,282.58
insurance
2. Unemployment
140,443.92 1,022,761.10 1,022,568.17 140,636.85
insurance
3. Enterprise annual fee 18,533,647.45 10,588,379.90 2,600,888.72 26,521,138.63
Total 22,659,623.13 39,750,249.06 31,810,814.13 30,599,058.06
Other notes：
21. Tax Payable
In RMB
Items Balance in year-end Balance in year-begin
VAT 48,556,625.63 10,970,877.80
101
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Enterprise Income tax 23,050,299.96 14,396,733.29
Individual Income tax 2,395,477.56 2,150,480.36
City Construction tax 3,376,104.99 1,731,728.51
Property tax 951,446.40 2,123,319.46
Land use tax 1,740,077.50 2,099,991.11
Education subjoin 1,465,841.76 745,239.69
Locality Education subjoin 977,222.83 496,821.48
Local water source foundation 172.38
Other 263,167.17 204,709.29
Total 82,776,263.80 34,920,073.37
Other notes：
22. Interest payable
In RMB
Items End of term Beginning of term
Long term interest on borrowings due in installments 100,958.90 121,172.22
Interest on short-term borrowings 147,688.55
Total 100,958.90 268,860.77
Particulars of significant overdue unpaid interest:
In RMB
Name Overdue amount Overdue reason
Other notes：
23.Other account payable
(1) Details
In RMB
Items End of term Beginning of term
Deposite 3,404,272.00 3,029,922.35
Provisional account payable 27,466,451.24 21,345,148.72
Other 3,662,383.26 3,484,546.26
Total 34,533,106.50 27,859,617.33
102
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
24. Non-current liabilities due within 1 year
In RMB
Items End of term Beginning of term
Long-term loans due within 1 year 4,900,000.00
Total 4,900,000.00
Other notes：
25.. Long-term loan
(1) Details
In RMB
Items End of term Beginning of term
Mortgage loan 22,800,000.00
Guarantee loan 100,000,000.00 100,000,000.00
Total 122,800,000.00 100,000,000.00
Notes :
Other notes，ncluding interest range：
26..Long term account payable
(1) Details
In RMN
Items End of term Beginning of term
CDB investment fund 208,000,000.00 208,000,000.00
Income payable of CDB 1,303,466.66
Drawing in administrative restructuring 330,000.00 330,000.00
Total 208,330,000.00 209,633,466.66
Other notes：
27.Special Payable
In RMB
Increased this Decreased this
Items Beginning of term End of term Reaseon
period period
Compensation for
237,658,831.07 237,658,831.07
relocation
Total 237,658,831.07 237,658,831.07 --
Other notes：
103
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
28. Deferred income
In RMB
Decreased this
Items Beginning of term Increased this period End of term Reaseon
period
Government Subsidy 4,063,615.00 4,063,615.00
Total 4,063,615.00 4,063,615.00 --
Details of government subsidies
In RMB
Other
New Amount Amount of
subsid transferred income
cost deducted Other Asset-related or
Items Beginning of term y in to recorded in End of term
in the current changes income-related
current non-operatio
the current
period nal income period
period
Financial support for
259,020.00 259,020.00 Related to assets
industrial projects
Government subsidy for
259,020.00 259,020.00 Related to assets
casting project
Circular economy
102,690.00 102,690.00 Related to assets
financial subsidy
Subsidy for industrial
upgrading by provincial 320,000.00 320,000.00 Related to assets
government
Finance for casting
2,909,025.00 2,909,025.00 Related to assets
project
Government subsidy for
industrial entities from
Yuhang District 213,860.00 213,860.00 Related to assets
Government in the 2nd
half of 2009
Total 4,063,615.00 4,063,615.00 --
Other notes：
104
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
29. Stock capital
In RMB
Increase/decrease this time (+ , - )
Balance Year-beginning Issuing of new Bonus Transferred from Balance year-end
Other Subtotal
share shares reserves
Total of capital
754,010,400.00 754,010,400.00
shares
Other notes：
30. Capital reserves
In RMB
Items Year-beginning balance Increase in the Decrease in the current Year-end balance
current period period
Share premium 81,769,963.93 81,769,963.93
Other capital reserves 57,775,125.09 57,775,125.09
Total 139,545,089.02 139,545,089.02
Notes：
105
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
31. Other comprehensive income
In RMB
Occurred current term
Less: accounted as other Attributable to
Items Beginning of term Amount occurred before gains previously but Less: Income tax Attributable to the minority End of term
income tax of the period transferred to gain/loss expenses parent co. after tax shareholders
this period after tax
II. Other Comprehensive income
that will be reclassified 1,570,358,510.09 -85,526,819.65 -12,816,974.02 -72,663,722.00 -46,123.63 1,497,694,788.09
subsequently to profit or loss
Gains or losses on changes in fair
value of available-for-sale 1,570,912,609.09 -85,446,493.44 -12,816,974.02 -72,629,519.42 1,498,283,089.67
financial assets
Difference of translating of
-554,099.00 -80,326.21 -34,202.58 -46,123.63 -588,301.58
foreign currency accounts
Total of other comprehensive
1,570,358,510.09 -85,526,819.65 -12,816,974.02 -72,663,722.00 -46,123.63 1,497,694,788.09
income
32.Special reserves
In RMB
Items Beginning of term Increased this period Decreased this period End of term
Labor safety expenses 25,369,714.61 706,095.97 1,556,698.26 24,519,112.32
Total 25,369,714.61 706,095.97 1,556,698.26 24,519,112.32
106
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
33. Surplus reserves
In RMB
Items Beginning of term Increased this period Decreased this period End of term
Statutory surplus
621,112,807.78 621,112,807.78
reserves
Total 621,112,807.78 621,112,807.78
Notes：
107
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
34. Retained profit
In RMB
Items Current term Same period of last term
After adjustments: Retained profits at the period beginning 2,774,420,288.05 2,705,667,037.15
Add：Net profit belonging to the owner of the parent
128,510,594.01 43,995,804.38
company
Common stock dividend payable -37,700,520.00
Retained profit at the end of this term 2,865,230,362.06 2,749,662,841.53
As regards the details of adjusted the beginning undistributed profits
(1)As the retroactive adjustment on Enterprise Accounting Standards and its related new regulations, the affected
beginning undistributed profits are RMB 0.00.
(2) As the change of the accounting policy, the affected beginning undistributed profits are RMB 0.00.
(3) As the correction of significant accounting error, the affected beginning undistributed profits are RMB 0.00 .
(4) As the change of consolidation scope caused by the same control, the affected beginning undistributed profits
are RMB 0.00.
35. Business income and Business cost
In RMB
Occurred current term Occurred in previous term
Items
Income Cost Income Cost
Main Business 2,276,427,071.38 1,608,263,667.71 1,565,958,109.92 1,100,055,409.37
Other 7,703,910.75 3,852,484.55 97,766,592.34 92,329,642.11
Total 2,284,130,982.13 1,612,116,152.26 1,663,724,702.26 1,192,385,051.48
36. Business tax and surcharge
In RMB
Items Occurred current term Occurred in previous term
City maintenance and construction tax 11,822,700.18 5,790,983.04
Education surtax 5,249,866.83 2,632,346.60
House tax 3,216,786.22 4,754,574.06
Land use tax 5,178,759.26 2,768,440.30
vehicle and vessel tax 24,888.00 23,508.00
Stamp tax 1,027,019.01 1,196,199.41
108
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Locality Education surcharge 3,299,209.54 1,570,499.17
Total 29,819,229.04 18,736,550.58
37. Sales expense
In RMB
Items Amount of this period Amount of last period
Employees’ remunerations 32,773,059.29 31,132,404.87
Transportation 14,693,552.44 15,433,500.28
Business trips 9,452,510.07 11,409,777.43
Business reception expenses 3,399,943.75 3,630,718.14
Conferences 8,058,157.00 8,523,496.71
Consulting service fee 900,990.48 1,702,501.62
Three charge 1,829,961.31 2,654,824.68
Advertising fee 904,782.48 462,976.14
Office expenses 610,525.86 803,886.89
Unit premium 175,631.84 241,740.99
Other 4,209,187.70 5,878,188.10
Total 77,008,302.22 81,874,015.85
38. Administrative expense
In RMB
Items Amount of this period Amount of last period
Employees’ remunerations 180,210,554.84 158,545,322.20
R&D expenses 151,349,561.04 140,500,456.42
Asset depreciation and amortizing 6,891,121.59 7,147,861.91
Business reception expenses 5,547,320.26 6,238,067.45
Rental fee, House rental, property
management, water and power 5,015,031.88 3,701,610.81
Traveling fees 4,275,372.97 3,768,385.52
Material, low-value-consumable 1,720,636.68 1,137,285.58
Office expenses 904,559.60 1,693,719.65
Maintaining 1,375,919.85 1,863,668.96
Other 31,515,542.48 29,815,399.31
Total 388,805,621.19 354,411,777.81
109
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
39. Financial expenses
In RMB
Items Occurred current term Occurred in previous term
Interest expense 6,422,483.44 5,243,164.77
Less: Incoming interests 6,343,865.32 3,290,329.23
Exchange gains/losses -1,251,354.77 3,746,363.69
Commission 1,032,189.81 1,795,106.71
Other 143,723.91 450,938.35
Total 3,177.07 7,945,244.29
40. Asset impairment loss
In RMB
Items Occurred current term Occurred in previous term
I .Losses for bad debts 43,111,352.82 35,378,404.08
Total 43,111,352.82 35,378,404.08
41. Investment income
In RMB
Items Occurred current term Occurred in previous term
Investment gains from holding of sellable financial assets 11,428,418.13 44,203,908.24
Investment income from disposal of available for sale financial assets 25,121,648.20
Gains from financing products 25,716,189.31 19,662,950.09
Total 37,144,607.44 88,988,506.53
42.Assets disposal income
In RMB
Items Occurred current term Occurred in previous term
Income form disposal of fixed assets 196,910.10
Loss form disposal of fixed assets 11,291.57
Total 185,618.53
43.Other income
In RMB
110
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Items Occurred current term Occurred in previous term
Government Subsidy 20,337,694.45 2,505,237.27
Total 20,337,694.45 2,505,237.27
44.Non-Operation income
In RMB
Recorded in the amount of the
Items Occurred current term Occurred in previous term
non-recurring gains and losses
Compensation income 3,727,204.67 1,397,065.22 3,727,204.67
Others 462,521.81 455,637.29 462,521.81
Total 4,189,726.48 1,852,702.51 4,189,726.48
45. Non-operational expenditure
In RMB
Same period of last Amount accounted into non-recurring
Items Current term
term gain/loss of current term
Donations 10,000.00 10,000.00 10,000.00
Penalty paid out 2,488,554.74 232,194.24 2,488,554.74
Special fund for water conservancy
770.69 1,462.68
construction
Fine, late payment 4,673.35 4,673.35
loss from disposal of non-current assets 3,031.08 5,065.11 3,031.08
Other 84,124.68 19,777.53 84,124.68
Total 2,591,154.54 268,499.56 2,590,383.85
46. Income tax expenses
(1) Details
In RMB
Items Current term Same period of last term
Income tax of current term 27,761,803.39 9,237,255.37
111
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Deferred income tax 4,216,068.43 -2,708,887.80
Total 31,977,871.82 6,528,367.57
(2) Adjustment process of accounting profit and income tax expenses
In RMB
Items Current term
Total profit 192,348,021.36
Income tax expense at statutory / applicable tax rates 28,852,203.20
Effect of different tax rates applicable to subsidiaries 1,460,599.96
Adjustment for income tax in prior year 1,246,937.97
-250,000.00
Income not subject to tax
Expenses not deductible for tax purposes 324,986.08
Impact of deductible temporary difference of un-recognized
343,144.60
deferred income tax asset of current period
Income tax expenses 31,977,871.82
47.Other Comprehensive income
Please find the statement in the notes of consolidated balance sheet.
48. Notes Cash flow statement
(1) Other cash received from business operation
In RMB
Items Occurred current term Occurred in previous term
Deposit interest 6,343,865.32 3,290,329.23
Government subsidies received 2,161,611.71 4,313,237.27
Note deposit and other 11,483,287.56 350,000.00
Compensation income 1,000.00 10,697.28
Other 1,823,428.44 46,018.25
112
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Total 21,813,193.03 8,010,282.03
Notes：
2. Other cash paid for business activities
In RMB
Items Occurred current term Occurred in previous term
Transportation 2,761,048.87 2,386,213.92
13,727,883.04 15,569,947.22
Travel expenses
Business trips 8,947,264.01 9,114,231.52
Maintaining 991,158.80 892,883.85
Property management and civil services 6,043,553.85 3,045,005.51
Deposit for bidding and others 4,967,366.64 533,396.53
Office expenses 2,365,249.57 3,374,787.41
Conferences 1,286,844.32 1,984,035.08
Consulting service fee 9,460,726.55 9,794,242.77
Transportation and vehicles 2,693,178.46 2,794,047.26
Other 30,132,445.17 29,495,330.68
Total 83,376,719.28 78,984,121.75
Notes：
3.Other investment-related cash received
In RMB
Items Occurred current term Occurred in previous term
Repurchasing of trusteeship 2,054,176,329.00 1,819,767,338.00
Total 2,054,176,329.00 1,819,767,338.00
Notes：
4. Other cash paid for investment activities
In RMB
Items Current term Same period of last term
Purchasing of financial products 2,477,114,000.00 1,729,150,000.00
Total 2,477,114,000.00 1,729,150,000.00
Notes ：
113
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
5.Other Cash payable related to financing activities
In RMB
Items Occurred current term Occurred in previous term
Cancellation of company property
12,824,456.40
assignment
Payment of CDB investment interest 2,530,666.67
Total 2,530,666.67 12,824,456.40
Notes：
49. Supplement Information for cash flow statement
（1）Supplement Information for cash flow statement
In RMB
Supplementary Info. Amount of the Current Term Amount of the Previous Term
I. Adjusting net profit to cash flow from operating activities -- --
Net profit 160,370,149.54 59,728,855.88
Add: Impairment loss provision of assets 43,111,352.82 35,378,404.08
Depreciation of fixed assets, oil and gas assets and consumable
34,665,195.13 38,554,988.75
biological assets
Amortization of intangible assets 3,549,845.84 3,026,009.40
Amortization of Long-term deferred expenses 126,943.44 132,581.88
Loss on disposal of fixed assets, intangible assets and other long-term
-180,553.42
deferred assets
Loss on scrap of fixed assets 3,031.08
Financial cost 5,171,128.67 8,369,082.20
Loss on investment -37,144,607.44 -88,988,506.53
Decrease of deferred income tax assets 4,216,068.43 -2,708,887.80
Increased of deferred income tax liabilities -3,329,084.16
Decrease of inventories 36,950,352.31 -151,123,337.73
Decease of operating receivables -206,949,145.32 -431,306,194.64
Increased of operating Payable 514,803,440.92 522,271,847.58
Other -1,086,564.69 -135,561.07
114
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Net cash flows arising from operating activities 557,787,190.73 -10,310,355.58
II. Significant investment and financing activities that without cash
-- --
flows:
3．Movement of cash and cash equivalents： -- --
Ending balance of cash 1,155,254,587.46 1,010,649,375.76
Less: Beginning balance of cash equivalents 1,137,492,834.83 895,037,559.34
Net increase of cash and cash equivalents 17,761,752.63 115,611,816.42
（2）Composition of cash and cash equivalents
In RMB
Items Balance in year-end Balance in year-Beginning
I. Cash 1,155,254,587.46 1,137,492,834.83
Of which: Cash in stock 292,307.47 208,763.32
Bank savings could be used at any time 1,154,962,279.99 1,137,284,071.51
III. Balance of cash and cash equivalents at
1,155,254,587.46 1,137,492,834.83
the period end
Other notes：
50. Note of statement of changes in the owner's equity
Explain "other" project name and adjustment amount of the adjustment of closing balance in previous year, etc.
51. Assets with limitation on ownership or using rights
In RMB
Items Closing book value Causation o limitation
Used as security for issuing of acceptance drafts and bill of
Monetary capital 75,549,211.33
guarantees
Note receivable 75,967,299.36 Used as security for issuing of acceptance drafts
Fixed assets 81,202,239.67 Used to obtain bank loans
Collateral for obtaining bank loans and investment funds from
Intangible assets 86,913,837.86
CDB
115
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Dividend receivable 6,900,000.00 Investment funds for the development of the State Fund
Available for sale financial assets 357,098,000.00 Investment funds for the development of the State Fund
Total 683,630,588.22 --
Other notes：
52.Monetary items in foreign currencies
(1) Foreign currency monetary items
In RMB
Translated to RMB at end of
Items Balance at end of period Exchange rate
period
Monetary capital -- -- 265,210,740.45
Incl：USD 39,391,981.17 6.6166 260,640,982.61
Euro 167,429.26 7.6515 1,281,084.98
HKD 5.51 0.8431 4.65
JPY 31,110.00 0.0599 1,863.49
Rupiah 6,978,353,969.42 0.000471 3,286,804.72
Account receivable -- -- 199,324,479.19
Incl：USD 28,736,918.83 6.6166 190,140,697.13
Euro 770,943.40 7.6515 5,898,873.43
Rupiah 6,484,036,159.79 0.000471 3,053,981.03
SGD 47,726.12 4.8386 230,927.60
Account payable 5,620,185.41
Incl：USD 741,243.83 6.6166 4,904,513.93
Euro 427.65 7.6515 3,272.16
Rupiah 1,512,525,098.46 0.000471 712,399.32
Other account receivable 3,355,400.00
Incl：USD 500,000.00 6.6166 3,308,300.00
Rupiah 100,000,000.00 0.000471 47,100.00
Other account payable 270,422.43
Incl：USD 40,870.30 6.6166 270,422.43
Other notes:
(2) Note to overseas operating entities, including important overseas operating entities, which should be disclosed
about its principal business place, function currency for bookkeeping and basis for the choice. In case of any
change in function currency, the cause should be disclosed.
116
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Hangzhou Zhongneng Steam Turbine Power (Indonesia) Co., Ltd. has its business located in Indonesia Rupee is
the pricing and booking currency of business operation.
VIII. Equities in Other Entities
(I) Equity in major subsidiaries
1. Composition of major subsidiaries
Name of the Main business Share proportion %
Reg. Add. Business property
subsidiaries location Way of obtain
Direct Indirect
Zhejiang Steam
Trubine Packaged
Hangzhou Hangzhou
Technologies Commerce 70.86% Incorporation
Zhejiang Zhejiang
Development Co.,
Ltd.
Hangzhou
Zhongneng Steam Hangzhou Hangzhou
Manufacturing
Turbine Power Co., 60.83% Incorporation
Zhejiang Zhejiang
Ltd. (Zhongneng Co.)
Hangzhou Steam
Hangzhou Hangzhou
Turbine Casting Co.,
Zhejiang Zhejiang Manufacturing 51.00% Incorporation
Ltd.
Hangzhou Steam
Hangzhou Hangzhou
Turbine Machinery Manufacturing
Zhejiang Zhejiang 52.00% Incorporation
Equipment Co., Ltd.
Hangzhou Steam
Turbine Auxiliary
Hangzhou Hangzhou
Machinery Co., Ltd.
Zhejiang Zhejiang Manufacturing 87.53% Incorporation
(Auxiliary Machinery
Co.)
117
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Zhejiang Turbine
Hangzhou Hangzhou
Import & Export Co., Commerce 100.00% Incorporation
Zhejiang Zhejiang
Ltd. (Turbine Co.)
Hangzhou Steam
Hangzhou Hangzhou
Turbine Heavy
Zhejiang Zhejiang Manufacturing 100.00% Incorporation
Industry Co., Ltd.
118
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
（2）Major non-fully-Owned subsidiaries
In RMB
Name of the Share protion of minor Gains/loss of the period attributable to Dividend announced in the period to minor Balance of eqiuty of minor
subsidiaries shareholders minor shareholders shareholders shareholders at end of period
Zhejiang Steam
Trubine Packaged
Technologies 29.14% 2,612,790.83 1,486,395.00 25,343,672.53
Development Co.,
Ltd.
Hangzhou
Zhongneng Steam
39.17% 5,580,566.27 19,586,000.00 127,538,152.99
turbine PowerCo.,
Ltd.
Hangzhou Steam
Turbine Casting 49.00% 10,084,593.41 2,450,000.00 79,763,398.44
Co., Ltd.
Hangzhou Steam
Turbine
Machinery 48.00% 12,438,670.20 0.00 83,699,129.28
Equipment Co.,
Ltd.
Hangzhou Steam 12.47% 1,142,934.82 3,990,400.00 23,075,958.61
119
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Turbine Auxiliary
Machinery Co.,
Ltd.
(3) Material financial information of major non-fully-owned subsidiaries
In RMB
End of term Beginning of term
Subsidiaries
Current Non-current Total of Non-current Current Non-current Total of
Name Current assets Non-current assets Total of assets Current assets Total of assets
liabilities liabilities liability assets liabilities liabilities liability
Zhejiang
Steam trubine
Packaged 166,557,799.0 166,557,799.0 219,292,216.3 243,667,362.7 160,574,913.6 160,574,913.6
229,168,161.90 24,346,885.81 253,515,047.71 24,375,146.44
Technology 6 6 4 8 8 8
Development
Co., Ltd.
Hangzhou
Zhongneng
1,032,803,820.7 803,072,032.4 803,402,032.4 1,037,373,643. 1,112,564,074. 772,310,062.7 772,640,062.7
Steam turbine 73,322,153.94 1,106,125,974.66 330,000.00 75,190,430.57 330,000.00
2 1 1 65 22 9 9
PowerCo.,
Ltd.
Hangzhou
Steam Turbine 363,678,253.4 390,328,008.4 304,833,240.8 184,619,003.1 489,452,244.0 312,465,702.8 316,315,457.8
392,117,334.06 178,052,573.36 570,169,907.42 26,649,755.00 3,849,755.00
Casting Co., 6 6 8 4 2 7 7
Ltd.
Hangzhou
205,163,731.1 226,945,835.7
Steam Turbine 245,594,494.91 21,301,077.49 266,895,572.40 91,931,046.80 591,339.61 92,522,386.41 21,782,104.60 77,895,206.35 591,339.61 78,486,545.96
1 1
Machinery
120
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Equipment
Co., Ltd.
Hangzhou
Steam Turbine
566,066,613.8 566,280,473.8 548,200,286.6 115,360,847.7 663,561,134.4 428,134,519.2 428,348,379.2
Auxiliary 655,460,508.52 113,565,935.22 769,026,443.74 213,860.00 213,860.00
4 4 7 6 3 0 0
Machinery
Co., Ltd.
In RMB
Amount of current period Amount of previous period
Subsidiaries Name
Cash flow for business Cash flow for business
Turnover Net profit Total Misc Gains Turnover Net profit Total Misc Gains
activities activities
Zhejiang Steam
Turbine Packaged
Technology 103,740,083.15 8,964,799.55 8,964,799.55 -3,782,165.04 95,183,579.66 2,530,829.59 2,530,829.59 9,781,050.35
Development Co.,
Ltd
Hangzhou
Zhongneng Steam
404,080,803.34 13,107,189.41 13,026,863.20 81,799,842.65 308,881,733.81 -4,491,604.31 -4,491,604.31 10,110,775.10
turbine Power Co.,
Ltd.
Hangzhou Steam
Turbine Casting 217,307,955.01 11,884,986.18 11,884,986.18 -36,112,238.38 144,755,281.64 5,817,815.64 5,817,815.64 422,629.68
Co., Ltd.
Hangzhou Steam
120,928,873.57 25,913,896.24 25,913,896.24 13,513,334.06 112,615,226.37 23,574,045.69 23,574,045.69 36,474,841.23
Turbine
121
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Machinery
Equipment Co.,
Ltd.
Hangzhou Steam
Turbine Auxiliary
225,615,296.83 5,792.82 5,792.82 33,715,715.56 214,290,527.44 21,921,639.27 21,921,639.27 30,104,537.33
Machinery Co.,
Ltd.
Other notes：
2. Rights and interests in joint venture arrangements or joint ventures
（1）Summary financial information of unimportant joint ventures and associated enterprises
In RMB
Year-end balance/ Amount of Year-beginning balance/ Amount of
current period previous period
Joint ventures -- --
Total book value of investments 5,800,000.00 5,800,000.00
Total of the following by shareholding ratio -- --
Associated enterprises -- --
Total of the following by shareholding ratio -- --
Other notes：
Zhejiang Runhong Gas Turbine Engineering Co., Ltd, which formerly was a second-tier holding subsidiary to the company, held 55.55% stake of its
subsidiary-Zhejiang Zhongrun Gas Turbine Technology Co., Ltd. However, after the equity transfer, Runhong transferred all its holding stake of Zhongrun to Turbo
Company and Ningbo Daxie Development Zone Huashun Industry & Trade Co., Ltd-respectively acquired 32.22% and 23.33% by them, and the industrial and
commercial change registration and the transfer of property rights were completed on December 26, 2017. Therefore, Runhong Company is no longer included in
the scope of the consolidated financial statements from November 2017, and it is changed to an associated enterprise to the company.
122
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
IX. Risks related to financial instruments
The objective of the Company’s risk management is to achieve a balance between the risk and gains. Constrain
the negative influence on business operation to the lowest limit, and maximum the interests of shareholders and
other equity holders. With regard to this target, the basic policies of the Company are; locate and analyse the risks,
set appropriate bottom line for risks, and manage and monitor on each risk and constrain them in a certain extent.
Risks attached to financial instruments are mainly credit risks, liquidity risks, and market risks.
The following risk managing policies have been examined and approved by the management:
(I) Credit risks
Credit risks are introduced when one party of the financial instrument failed to exercise its liabilities and then
caused financial loss to another.
The credit risks of the Company are mainly composed by bank savings and receivable accounts. Following
measurements are adopted to control these risks:
1. Bank deposit
The Company puts its bank savings in financial institutions with higher credit ranks, therefore with lower risks.
2. Account receivable
The Company performs credit assessment on the clients on periodic and constant basis. Results suggested by the
assessment are used by the Company to determine clients with higher ranks and to overlook the rest. This was
conducted to avoid risks brought by material bad debts.
As the Company only does business with recognized and reputable third parties, so no collateral is needed.
Credit risks are centralized managed in accordance with customers. As of June 30, 2018, the Company has a
characteristic of specific credit risk concentration. 36.50% (June 30, 2018: 36.50%) of the Company's accounts
receivable comes from the top five customers. The Company does not hold any collateral or other credit
enhancement for the balance of accounts receivable.
(1) Analyzing of receivable accounts neither due nor impaired, and those have due but not impaired:
Items End of term
Not overdue and not Overdue but not impaired Total
impaired Within 1 year 1-2 years Over 2 years
Note receivable 701,265,837.50 701,265,837.50
Subtotal 701,265,837.50 701,265,837.50
(Continued)
Items Beginning of term
Not overdue and not Overdue but not impaired Total
impaired Within 1 year 1-2 years Over 2 years
Note receivable 715,410,887.68 715,410,887.68
Subtotal 715,410,887.68 715,410,887.68
(II) Liquidation risks
123
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Liquidation risks are the possibilities of short in cash at fulfilling liabilities of payment or settlement for financial
assets. They may be caused by failing to cash financial assets at fair value instantly; debtors’ failing of paying
debts due; debts due before schedule; or failing of generating expected cash flow.
To handle these risks, the Company adopted multiple measures such as note clearance and bank loans.
Long-term and short-term financing approaches were used to maintain balance between constancy and flexibility.
The Company has obtained credit from multiple banks to satisfy the needs of business operation and capital
output.
Items End of term
Book value Contract amount not within 1 year 1-3 years Over 3 years
discounted
Short-term loans 140,000,000.00 143,828,456.79 143,828,456.79
Notes payable 264,683,667.48 264,683,667.48 264,683,667.48
Non-current liabilities
due to 1 year
Long-term loan 122,800,000.00 131,196,350.48 4,876,300.00 126,320,050.48
Long-term payable 208,330,000.00 220,221,066.66 0.00 53,000,000.00 167,221,066.66
Account payable 1,069,091,984.87 1,069,091,984.87 1,069,091,984.87
Other account payable 34,533,106.50 34,533,106.50 34,533,106.50
Subtotal 1,839,438,758.85 1,863,554,632.78 1,517,013,515.64 179,320,050.48 167,221,066.66
(Continued)
Items Beginning of term
Book value Contract amount not within 1 year 1-3 years Over 3 years
discounted
Short-term loans 115,500,000.00 117,664,804.32 117,664,804.32
Notes payable 215,409,958.92 215,409,958.92 215,409,958.92
Non-current liabilities 4,900,000.00 4,903,383.01 4,903,383.01
due to 1 year
Long-term loan 100,000,000.00 107,057,027.40 3,685,000.00 103,372,027.40
Long-term payable 209,633,466.66 222,751,733.33 53,000,000.00 169,751,733.33
Account payable 882,715,465.65 882,715,465.65 882,715,465.65
Other account payable 27,859,617.33 27,859,617.33 27,859,617.33
Subtotal 1,556,018,508.56 1,578,361,989.96 1,252,238,229.23 156,372,027.40 169,751,733.33
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Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
(III) Market risks
Market risks are those brought by change of fair value or expectable cash flow of financial instruments due to
change of market prices, mainly interest risks and exchange rate risks.
1. Interest risks
Interest risks are those brought by change of fair value or expectable cash flow of financial instruments due to
change of interest rates, mainly regards the loans at floating interest rates.
2. Foreign currency risks
Foreign currency risks (exchange rate risks) are those caused by change of fair value or expectable cash flow
of financial instruments due to fluctuation of exchange rates. These risks are mainly related to foreign currency
assets and liabilities. The Company operates in mainland China and mostly uses RMB as standard currency,
therefore no major risks regarding exchange rates. For details of foreign currency assets and liabilities, please go
to the descriptions in the notes to the consolidated financial statements.
X.Fair value disclosure
(I)Closing balance of assets and liabilities measured at fair value
In RMB
June 30,2018
Items
Level 1 Level 2 Level 3 Total
I. Consistent fair value
-- -- -- --
measurement
（II）Available-for-sale Financial
2,153,640,027.84 2,153,640,027.84
Assets
（2）Equity instrument investment 2,153,640,027.84 2,153,640,027.84
II.Non-continuous measurement fair
-- -- -- --
value
(II) Market price basis at fair value by level 1 on a continued and non-continued basis
The shares of Hangzhou Bank Co., Ltd. held by the Company have active market quotations, so it is
measured in accordance with the first level of fair value.
XI. Related parties and related transactions
1. Parent company of the Company
Name of the parent Reg. Add. Business property Registered capital Shareholding of the Voting rights of the parent
125
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
co. parent co. co. %
Hangzhou Steam
Hangzhou China Manufacturing RMB 800 million 63.64% 63.64%
Turbine Group
Notes :Hangzhou Municipal Government State-owned Asset Supervisory Committee is the ultimate controller of
the Company.
Other notes：
2.Subsidiaries of the enterprise
For details of subsidiaries please go to the statement of equities in other entities.
3. Situation of joint ventures and associated enterprises
For details of the important joint venture or joint venture of the enterprise, see the description of the rights and
interests in other parties in the notes
4. Other related parties
Name of the related parties Relationship with the Company
Hangzhou Steam turbine Automobile sales service Co., Ltd. Affiliate of the Group
Hangzhou Hangfa Generating Equipment Co., Ltd. Affiliate of the Group
It was once a subsidiary of Hangzhou Steam Turbine
Group and completed the equity transfer procedure on
March 28, 2018. After the completion of the equity
Hangzhou Nanfangtongda Gears Co., Ltd.
transfer, Hangzhou Steam Turbine Group no longer
holds any equity of Hangzhou Nanfang Tongda Gear
Co., Ltd.
Hangzhou Nanhua Wooden Packaging Co., Ltd. Affiliate of the Group
Hangzhou Steam Turbine Industrical Co., Ltd. Affiliate of the Group
Hangzhou Steam Turbine Engineering Co., Ltd. Affiliate of the Group
Hangzhou Steam Turbine Power Group Equipment Co., Ltd. Affiliate of the Group
Hangzhou Steam Turbine Compressor Co., Ltd. Affiliate of the Group
Hangzhou Wandong Electric Co., Ltd Affiliate of the Group
China Electrical and Mechanical Institute-Hangzhou Turbine Group
Affiliate of the Group
(Hangzhou) United Research Institute Co., Ltd.
Zhejiang Juqing Investment Co., Ltd. Affiliate of the Group
Greenesol power systems PVT Ltd. Shareholding enterprise
Hangzhou Bank Shareholding enterprise
5.Related transaction
(1) Sale of goods/rendering of labor services/labor service offering
Purchase of goods and service
126
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
In RMB
Over the
Content of related Amount of current Amount of previous Amount of last
Ralated parties trading limit
transaction period
or not?
period period
Hangzhou Steam turbine Automobile Transportation ,
20,047,920.03 20,047,920.03 No 25,108,972.57
sales service Co., Ltd. repair , etc.
Hangzhou Hangfa Generating Equipment
Generators 66,654,877.76 66,654,877.76 No 56,688,888.99
Co., Ltd.
Hangzhou Nanhua Wooden Packaging
Packaging 6,153,165.35 6,153,165.35 No 5,928,878.83
Co., Ltd.
Hangzhou Nanfang Tongda Gears Co.,
Gear boxes 1,863,034.19 1,863,034.19 No 5,635,780.34
Ltd.
Raw material,
Hangzhou Steam Turbine Industrial Co.,
Industrial 383,759.46 383,759.46 No 482,896.70
Ltd.
cooperation
Greenesol Company(India) Generator No 34,062.49
Hangzhou Steam Turbine
Group(Hangzhou)Union Institure Co., Raw material 998,507.96 998,507.96 No 677,912.62
Ltd.
Hangzhou Steam Turbine Engineering
Steam turbine Part 427,350.43 427,350.43 No 86,792.45
Co., Ltd.
Subtotal 96,528,615.18 96,528,615.18 94,644,184.99
Related transactions regarding sales of goods or providing of services
In RMB
Subjects of the related
Related parties Current term Same period of last term
transactions
Hangzhou Hangfa Generating Equipment Cast parts
7,495,811.84 5,756,434.06
Co., Ltd.
Hangzhou Steam Turbine Engineering Co., Steam turbine,compressor,
45,627,247.27 28,790,427.34
Ltd. Installation service
Hangzhou Steam Turbine Group Development 45,283.02
Hangzhou Steam Turbine Automobile Sales
Small amount materials 302.06 24,077.26
Service Co., Ltd.
Greenesol Company(India) Part 521,141.46 422,686.78
Hangzhou Steam Turbine Compressor Co., Part, Industrial cooperation 34,012.82
127
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Ltd.
Subtotal 53,644,502.63 35,072,921.28
（3）Information of related lease
- The company was lessee：
In RMB
Category of leased The lease income
Lessor Category of leased assets
assets confirmed in this year
HSTG House and Building 737,888.21 677,309.71
Hangzhou Steam Turbine Automobile Sales
Site leasing 1,197,365.43 1,397,601.51
Service Co., Ltd.
1,935,253.64 2,074,911.22
（4）Related-party guarantee
The Company was guarantor
In RMB
Execution
Guarantor Guarantee amount Start date End date
accomplished or not
HSTG 100,000,000.00 November 30,2017 November 30,2019 No
Notes
In accordance with the National Development Fund Investment Contract, jointly signed by the Company, NDF,
Turbine Industry Company and Hangzhou Steam Turbine Group, the investment of the NDF on Turbine Industry
Company, RMB 208,000,000.00, is repurchased by the Hangzhou Steam Turbine Group, and the NDF asks the
Company and Hangzhou Steam Turbine Group to provide guarantee for the fulfillment of Hangzhou Steam
Turbine Group of the transferee equity obligations. The Company and Steam Turbine Company pledge to the NDF
with a total of 32.2 million shares of Hangzhou Bank Co., Ltd. with book value of RMB 357,098,000.00,Dividend
Receiviable of RMB 6,900,000.00 and the land use right with book value of RMB67,408,970.85.
(5) Inter-bank lending of capital of related parties
Nil
（6）Related party asset transfer and debt restructuring
Nil
（7） Remunerations of key managements
In RMB
Items Current term Same period of last term
Remunerations of key managements 3,834,075.47 2,116,859.61
128
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
(8) Other related transactions
(1) Service and power supply
HSTG supplies water and power to the Company and some of the subsidiaries amounted to RMB 7,289,076.82
this period.
HSTG. provides property management services for its subsidiary which is Complete Technology Corporation, of
which the fee of this period incurred in the property management is RMB 24,046.96.
Hangzhou Steam Turbine Automobile Sales & Service Co., Ltd. provided transportation to the Company’s
employees and RMB 1,050,282.00 was paid this period.
Hangzhou Steam Turbine Industry Co., Ltd. provided cleaning services to the Company and RMB 542,452.87 was
paid this period.
Hangzhou Steam Turbine Compressor provided technical services to Subsidiary-Zhongneng
Company. The Subsidiary-Zhongneng paid technical service fees of RMB 1,099,056.6 in the current period
Company paid technical service fees of RMB 339,622.64in the current period
(3) Expenses paid on behalf the Company
Hangzhou Steam Turbine Group advanced the payment of RMB 617,707.79 salaries for the company, For the
subsidiary company Huayuan company, the social security of RMB 21,937.20 .
6. Receivables and payables of related parties
（1）Receivables
In RMB
End of term Beginning of term
Name Related party
Book balance Bad debt provision Book balance Bad debt provision
Note Hangzhou Steam Turbine
18,842,000.00 9,022,000.00
receivable Engineering Co., Ltd.
Hangzhou Hangfa Generating
9,501,890.56
Equipment Co., Ltd.
Subtotal 28,343,890.56 9,022,000.00
Account Hangzhou Steam Turbine
57,277,473.87 12,471,367.18 60,048,003.87 12,214,467.99
receivable Engineering Co., Ltd.
Hangzhou Hangfa Generating
22,129,039.79 1,459,133.83 23,168,548.05 1,656,221.13
Equipment Co., Ltd.
Hangzhou Steam Turbine Power
Group Complete Equipment 305,000.00 305,000.00
Engineering Co., Ltd
Hangzhou Steam Turbine 59,000.00 17,700.00 59,000.00 17,700.00
129
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Compressor Co., Ltd’
Hangzhou Steam Turbine Power
158,500.00 158,500.00 158,500.00 158,500.00
Group Co., Ltd.
Hangzhou Steam Turbine
352.53 17.63
Automobile Sales Service Co., Ltd
Greenesol Co.(India) 15,553,726.48 15,208,167.93 13,825,933.72 13,825,933.72
Subtotal 95,178,092.67 29,314,886.57 97,564,985.64 28,177,822.84
Hangzhou Hangfa Generating
Prepayment 53,956,785.00 43,741,785.00
Equipment Co., Ltd.
Hangzhou Steam Turbine
3,060,000.00 2,022,000.00
Engineering Co., Ltd.
Zhejiang Zongrun Gas turbine
715,000.00
technology Co., Ltd.
Hangzhou Nanfang Tongda Gears
50,000.00
Co., Ltd.
Subtotal 57,016,785.00 46,528,785.00
Other account Hangzhou Steam Turbine
300,000.00 15,000.00 346,200.00 17,310.00
receivable Compressor Co., Ltd.
Hangzhou Steam Turbine Group 39,105.34 3,910.53 39,105.34 1,955.27
Subtotal 339,105.34 18,910.53 385,305.34 19,265.27
（2）Payables
In RMB
Name Related party Amount at year Amount at year beginning
Hangzhou Steam Turbine Automobile Sales Service
Note payable 1,280,000.00 1,350,000.00
Co., Ltd
Hangzhou Steam Turbine Engineering Co., Ltd. 0.00 180,000.00
Subtotal 1,280,000.00 1,530,000.00
Account payable Hangzhou Hangfa Generating Equipment Co., Ltd. 126,107,138.95 133,726,506.11
Greenesol Co.(India) 0.00 3,219,116.49
Hangzhou Steam Turbine Power Group Co., Ltd. 8,377,645.99 79,982.49
Hangzhou Steam Turbine Automobile Sales Service
7,103,409.01 8,809,544.81
Co., Ltd
Hangzhou Nanhua Wooden Packaging Co., Ltd. 1,996,099.12 1,667,167.51
Hangzhou Steam Turbine Engineering Co., Ltd. 2,885,000.00 3,510,000.00
130
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
HSTG (Hangzhou) United Institutes Co., Ltd. 1,014,600.00 542,775.00
Hangzhou Nanfang Tongda Gears Co., Ltd. 939,584.00 1,147,694.00
Hangzhou Steam Turbine Industrial Co., Ltd. 163,720.34 128,042.88
Subtotal 148,587,197.41 152,830,829.29
Advances received Hangzhou Steam Turbine Engineering Co., Ltd. 8,559,300.00 31,613,190.00
Hangzhou Steam Turbine Compressor Co., Ltd. 14,190,000.00 14,190,000.00
Greenesol Co.(India) 11,739.09 51,968.30
Subtotal 22,761,039.09 45,855,158.30
Other account
Hangzhou Steam Turbine Group 894,373.08 221,351.95
payable
Hangzhou Steam Turbine Automobile Sales Service
100,000.00 100,000.00
Co., Ltd
Subtotal 994,373.08 321,351.95
7. Related party commitment
8.Other:Nil
XII. Enents after balance sheet date
1. Significant events had not adjusted
Nil
2.Profit distribution
Nil
3.Sales return
Nil
4.Notes of other significant event after balance sheet date
Nil
XIII.Other significant events
1.Information of Division
(1) The companies,which have no report divisions or can not disclose the total assets and total liabilities of all
131
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
report divisions, shall give explanations.
The Company is single in its business, which is mainly for production and sales of steam turbines, gas turbines
and auxiliary turbines. The company’s management regard these businesses as a whole to implement management
so as to evaluate the business performance, thus there will be no report divisions. According to the product
classifications of main business income and main business cost, the Company will make details for them as
follows:
Items Main Business Income Main Business Cost
Industrial Steam Turbine 1,756,496,345.21 1,217,492,254.72
Castings and Forging 66,352,498.00 51,917,888.16
Auxiliary Engines 80,710,048.93 70,149,642.15
Complete set of waste heat power station 53,946,887.10 44,299,572.55
Part 150,131,695.85 78,545,922.02
Other 168,789,596.29 145,858,388.11
Subtotal 2,276,427,071.38 1,608,263,667.71
132
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
XIV. Notes to the Financial Statements of the Parent Co.
1. Account receivable
（1）Detailed categories
In RMB
End of term Beginning of term
Book balance Bad debt provision Book balance Bad debt provision
Category
Proportion Proportion Book value Proportion Proportion Book value
Amount Amount Amount Amount
% % % %
Receivables
provided bad debt
2,192,469,669.70 98.66% 810,978,971.53 36.99% 1,381,490,698.17 1,975,235,478.30 98.51% 779,285,370.98 39.45% 1,195,950,107.32
provision in cridit
risk groups
Account receivable
with Not minor
individual amount
29,819,607.69 1.34% 29,819,607.69 100.00% 29,819,607.69 1.49% 29,819,607.69 100.00%
but bad debt
provision is
provided
Total 2,222,289,277.39 100.00% 840,798,579.22 37.83% 1,381,490,698.17 2,005,055,085.99 100.00% 809,104,978.67 40.35% 1,195,950,107.32
Receivables with individually significant amount and provision for bad and doubtful debts individually provided at the end of the reporting period.
Not applicable
Receivable accounts in the group on which bad debt provisions are provided on age basis
In RMB
End of term
Aging
Other receivable account Bad debt provision Proportion%
133
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Subitem within 1 year
Subtotal within 1 year 700,226,242.20 35,011,312.11 5.00%
1-2 years 396,451,926.30 39,645,192.63 10.00%
2-3 years 237,598,892.00 71,279,667.59 30.00%
Over 3 years 793,915,241.90 665,042,799.20
3-4 years 216,880,412.40 130,128,247.40 60.00%
4-5 years 210,601,388.60 168,481,110.90 80.00%
Over 5 years 366,433,440.90 366,433,440.90 100.00%
Total 2,128,192,302.28 810,978,971.53 38.11%
134
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Receivable accounts combined within consolidating range for providing of bad debt provisions
End of term
Name
Book balance Bad debt provision Providing rate %
Combinations of related transactions 64,277,367.42
in consolidation range
Subtotal 64,277,367.42
Receivable accounts and other receivable accounts within the consolidation range are tested for impairment
individually. No bad debt provision is provided in case there is no impairment occurred.
Receivables with provision for bad and doubtful debts based on the balance percentage method in the portfolio
Not applicable
Receivables with provision for bad and doubtful debts based on the other method in the portfolio
（2）Accrual period, recovery or reversal of bad debts situation
The current amount of provision for bad debts is RMB32,987,741.11; recovery or payback for bad debts Amount i
s RMB0.00.
(3) Receivable accounts actually written off in the report period
In RMB
Items Amount
Uncollectible amount 1,294,140.56
The significant actual write-off accounts receivable:
In RMB
Nature of Arising from
Amount written Reason for
Name account Verification procedures related
off written-off
receivable transactions(Y/N)
Uncollectible The examined and adopted
Zhejiang Xiuzhou Paper Co., Ltd. Goods 450,000.00 No
amount to Board of directors
Huainan Pingwei No.3 Power Generation Uncollectible The examined and adopted
Goods 300,000.00 No
Co., Ltd. amount to Board of directors
Shanghai Yunneng Energy Technology Uncollectible The examined and adopted
Goods 224,000.00 No
Co., Ltd. amount to Board of directors
Uncollectible The examined and adopted
Huaihu coal power Co., Ltd. Goods 153,000.00 No
amount to Board of directors
Uncollectible The examined and adopted
Other Goods 167,140.56 No
amount to Board of directors
135
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Total -- 1,294,140.56 -- -- --
Notes ：
（4）The ending balance of account receivables owed by the imputation of the top five parties
Name Amount Proportion(%) Bad debt provision
Client 1 631,855,450.92 29.00% 291,935,614.87
Client 2 284,014,771.02 13.00% 188,809,322.02
Client 3 79,995,000.00 4.00% 3,999,750.00
Client 4 44,590,545.99 2.00% 11,523,045.79
Client 5 43,914,000.00 2.00% 4,391,400.00
Subtotal 1,084,369,767.93 50.00% 500,659,132.68
（5）Account receivable which terminate the recognition owning to the transfer of the financial assets
(6)The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts
receivable
Other notes：
136
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
2. Other account receivable
（1）Other account receivable classified by category
In RMB
Year-end balance Year-beginning
Book balance Provision for bad debts Book balance Provision for bad debts
Category
Proportion( Proportion(% Book value Proportion Proportion( Book value
Amount Amount Amount Amount
%) ) (%) %)
Other receivables provided
bad debt provision in credit 11,601,933.00 100.00% 5,650,785.55 48.71% 5,951,147.45 9,976,732.52 100.00% 5,665,193.66 56.78% 4,311,538.86
risk groups
Total 11,601,933.00 100.00% 5,650,785.55 53.67% 5,951,147.45 9,976,732.52 100.00% 5,665,193.66 56.78% 4,311,538.86
Other Receivable accounts with large amount individually and bad debt provisions were provided
Not applicable
Other receivable accounts in the group on which bad debt provisions are provided on age basis
In RMB
End of term
Age
Other receivable account Bad debt provision Proportion%
Subitem within 1 year
Subtotal within 1 year 3,696,227.44 184,811.37 5.00%
1-2 years 63,204.00 6,320.40 10.00%
2-3 years 1,079,541.00 323,862.30 30.00%
Over 3 years 5,688,942.24 5,135,791.48
3-4 years 1,093,495.90 656,097.54 60.00%
137
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
4-5 years 578,762.00 463,009.60 80.00%
Over 5 years 4,016,684.34 4,016,684.34 100.00%
Total 10,527,914.68 5,650,785.55 53.67%
138
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
In the groups, other accounts receivable adopting other methods to withdraw bad debt provision:
√ Applicable □Not applicable
End of term
Name
Book balance Bad debt provision Providing rate %
Combinations of related transactions 1,074,018.32
in consolidation range
Subtotal 1,074,018.32
Remarks on deciding of combinations:
Receivable accounts and other receivable accounts within the consolidation range are tested for impairment
individually. No bad debt provision is provided in case there is no impairment occurred.
Other receivables with provision for bad and doubtful debts based on the balance percentage method in the
portfolio
Not applicable
Other receivables with provision for bad and doubtful debts based on the other method in the portfolio
Not applicable
（2）Bad debt provision withdrawal, reversed or recovered in the report period.
The current amount of provision for bad debts is RMB-14,408.11; recovery or payback for bad debts Amount is R
MB0.00.
(3) Other accounts receivable classified by the nature of accounts
In RMB
Nature Closing book balance Opening book balance
Deposit 5,284,198.00 8,081,489.08
Provisional payment receivable 5,874,071.40 1,006,799.70
Petty cash 428,000.00 231,000.00
Other 15,663.60 657,443.74
Total 11,601,933.00 9,976,732.52
(5) Top 5 of the closing balance of Other accounts receivable
In RMB
Account Percentage in total Bad debt
Name of the company Book balance Age
property other receivable % provision
Deposit in
Over 5
Shanghai Customs Waigaoqiao Office 3,710,320.94 35.24% 3,710,320.94
custom years
China Electric Power Complete Equipment Co., Ltd. Deposit in 1,651,000.00 Within 1 15.68% 82,550.00
139
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
custom year
Deposit in
Guoxin Bidding Group Co., Ltd. 800,000.00 2-3 years 7.60% 240,000.00
custom
Deposit in
China Petroleum & Chemical Corporation.Nanjing Within 1
596,777.00 5.67% 29,838.85
Bidding Center custom year
Deposit in
Jian Group Co., Ltd. 500,000.00 3-4 years 4.75% 300,000.00
custom
Total -- 7,258,097.94 -- 68.94% 4,362,709.79
（6）Account receivable involving government subsidies
In RMB
Name of government Estimated time, amount
Name End of term End of aging
subvented project and basis of collection
（7）Other account receivable derecognized due to the transfer of financial assets
（8）Amount of transfer other account receivable and assets and liabilities formed by its continuous involvement.
3. Long-term share equity investment
In RMB
End of term Beginning of term
Items Impairmen Impairment
Book balance Book value Book balance Book value
t provision provision
Investment on
502,919,378.03 502,919,378.03 502,919,378.03 502,919,378.03
subsidiaries
Total 502,919,378.03 502,919,378.03 502,919,378.03 502,919,378.03
(1) Investment on subsidiaries
In RMB
Provided
Impairment
Company invested Increased Current term current term
Beginning of term End of term provision
in this period decrease Impairment
End of term
provision
Touping Company 20,000,000.00 20,000,000.00
Hangzhou Heavy
360,000,000.00 360,000,000.00
Industry
140
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
Hangzhou
Auxiliary Machine 46,286,513.41 46,286,513.41
Co.
Zhejiang Turbine
29,800,389.56 29,800,389.56
Packaged Co.
Zhongneng Co. 27,644,475.06 27,644,475.06
Machinery Co. 7,968,000.00 7,968,000.00
Casting Co. 11,220,000.00 11,220,000.00
Total 502,919,378.03 502,919,378.03
4. Business income and Business cost
In RMB
Items Amount of current period Amount of previous period
Income Cost Income Cost
Main business 1,483,873,460.09 1,087,042,320.25 1,022,711,006.96 758,653,563.38
Other business 6,865,424.39 5,383,386.09 93,434,073.65 90,328,583.22
Total 1,490,738,884.48 1,092,425,706.34 1,116,145,080.61 848,982,146.60
Other notes：
5.Investment income
In RMB
Items
Amount of current period Amount of previous period
Long-term equity investment income by Cost method 64,587,205.00 60,959,407.50
Investment income received from holding of available-for –sale
10,428,418.13 43,203,908.24
financial assets
Investment income from disposal of available for sale financial assets 0.00 25,121,648.20
Financing product investment inocme 22,630,167.78 12,028,688.59
Total 97,645,790.91 141,313,652.53
XV. Supplement information
1. Particulars about current non-recurring gains and loss
141
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
In RMB
Items Amount Notes
Gains/losses from the disposal of non-current asset -3,031.08
Governmental subsidy calculated into current gains and loess（while closely
related with the normal business of the Company, excluding the fixed-amount
20,337,694.45
or fixed-proportion governmental subsidy according to the unified national
standard）
Gains and losses from change of fair values of held-for-transaction financial
assets and financial liabilities except for the effective hedge business related
to normal business of the Company, and investment income from disposal of 25,716,189.31
transactional financial assets and liabilities and financial assets available for
sale
Other non-business income and expenditures other than the above 1,602,373.71
Less: Influenced amount of income tax 7,271,797.15
Amount of influence of minority interests 1,341,561.95
Total 39,039,867.29 --
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses and
its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure
for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as
recurring gains and losses, it is necessary to explain the reason.
Not applicable
2. Return on equity (ROE) and earnings per share (EPS)
EPS（Yuan/share）
Profit as of reporting period Weighted average ROE (%)
EPS-basic EPS-diluted
Net profit attributable to common
2.18% 0.17 0.17
shareholders of the Company
Net profit attributable to common
shareholders of the Company after
1.52% 0.119 0.119
deduction of non-recurring profit
and loss
142
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2018
XI. Documents available for inspection
(I) Financial Statements signed and sealed by the Chairman of the Board , chief accountant and director of
the financial division;
(II) All the originals of the Company’s documents and public notices disclosed in the newspapers
designated by China Securities Regulatory Commission in the report period;
(III) Original copy of Resolutions of the 26th Meeting of the 7th Term of Board.
Hangzhou Steam Turbine Co., Ltd.
Chairman of the Board: Zheng Bin
August 22, 2018
143
