China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 1 Stock Code: 000024, 200024 No.:【CMPD】2010-008 Short Form of the Stock: CMPD, CMPD-B China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) §1. Important Notes 1.1 Board of Directors and the Supervisory Committee of China Merchants Property Development Co., Ltd. (hereinafter referred to as the Company) and its directors, supervisors and senior executives hereby confirm that there are no any fictitious statements, misleading statements, or important omissions carried in this report, and shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of the whole contents. 1.2 The First Quarterly Financial Report of 2010 has not been audited by CPAs. 1.3 Sun Chengming – Legal Representative the Company, Huang Peikun –CFO, and Xu Yixia –Manager of Financial Department hereby confirm hereby confirm that the Financial Report of the First Quarterly Report is true and complete. 1.4 This report has been prepared in Chinese and English version respectively. In the event of differences in interpretation between the two versions, the Chinese report shall prevail. §2. Company Profile 2.1 Main accounting highlights and financial indexes: Unit: RMB At the end of the report period At the period-end of the last year Changes of increase/decrease (%) Total assets (RMB) 47,429,575,549.00 47,897,160,497.00 -0.98% Shareholders’ equity attributable to shareholders of the listed company (RMB) 16,664,489,833.00 16,278,736,754.00 2.37% Share capital (Share) 1,717,300,503.00 1,717,300,503.00 0.00% Net asset per share attributable to shareholders of listed company (RMB/Share) 9.70 9.48 2.32% In the report period The same period of last year Changes of increase/decrease (%) Total operating income (RMB) 2,424,036,323.00 823,094,572.00 194.50% Net profit attributable to shareholders of the listed company (RMB) 384,901,880.00 170,579,055.00 125.64% Net cash flow arising from operating activities (RMB) -793,859,169.00 94,612,265.00 -939.07% Net cash flow arising from operating activities per share (RMB/Share) -0.46 0.06 -866.67% Basic earnings per share (RMB/Share) 0.22 0.10 120.00% Diluted earnings per share (RMB/Share) 0.22 0.10 120.00% Weighted average return on equity (%) 2.34% 1.13% 1.21% Weighted average return on equity after 2.32% 1.08% 1.24%China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 2 deducting non-recurring gains and losses (%) Items of non-recurring gains and losses Amount in year-begin to the end of report period Gains and losses from the disposal of non-current assets -71,424.00 Other non-operating income and expenditure except for the aforementioned items 3,435,699.00 Influenced amount of income tax -284,088.00 Influenced amount of minority shareholders’ equities -179,928.00 Total 2,900,259.00 2.2 Total number of shareholders at the end of the report period and shares held by the top ten shareholders with unrestricted conditions Unit: Share Total number of shareholders at the end of report period 101,406 Particulars about the shares held by the top ten tradable shareholders with unrestricted conditions Full name of shareholder Amount of tradable shares with unrestricted conditions held at the end of report period Type of shares Fullgoal Tianrui Surging Area Selected Mixed Stock Fund 23,052,268 A shares Dacheng Blue Chip Steady Stock Fund 16,499,924 A shares Penghua Value Advanced Stock Fund 13,801,580 A shares E Fund Shenzhen Stock Exchange 100 Exchange Traded Fund 12,242,130 A shares China Pacific Insurance (Group) Co., Ltd.-Traditional- General Insurance Products -CT001Shen 11,405,620 A shares Southern Longyuan Industry Theme Stock Fund 10,094,943 A shares Invesco Great Wall Selected Blue Chip Stock Fund 9,367,100 A shares Invesco Great Wall Resource Monopoly Stock Fund 8,689,366 A shares DREYFUS PREMIER INVESTMENT FDS INC.-DREYFUS GREATER CHINA FD 8,378,941 B shares Rongtong Shenzhen Stock Exchange 100 Index Stock Fund 7,985,203 A shares §3. Significant Events 3.1 Particulars about material changes in items of main accounting statement and financial index, and explanations of reasons √Applicable □Inapplicable Items 2010.03.31 2009.12.31 Increase/decrease (± %) Main reasons for changes Transaction financial assets 13,604,043 6,437,479 111% Increased due to increase in NDF contract and fluctuation in market price of NDF in the report periodChina Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 3 Account receivable 74,654,727 118,962,896 -37% Decrease in electric bill receivable and took back house account sold last year Transaction financial liabilities 4,377,347 12,829,413 -66% Decreased due to fluctuation in market price of NDF in the report period Staff salary payable 84,069,999 162,832,982 -48% Payment for the salary withdrawn last year Taxes payable 240,298,502 589,859,453 -59% Payment for the taxes withdrawn last year Interests payable 30,684,178 21,872,418 40% Increases in loans Dividends payable 46,196,258 107,751,887 -57% Payment for minority shareholders’ dividend payable last year Items Jan-Mar 2010 Jan-Mar 2009 Increase/decrease (± %) Main reasons for changes Operating income 2,424,036,323 823,094,572 195% Increases of sales income of property Operating cost 1,443,764,646 462,419,443 212% Increases of sales cost of property Operating tax and extras 279,890,107 88,109,440 218% Increase in sales income of property caused the increase of taxes Administrative expense 50,880,224 38,405,719 32% Companies and staff increased in scope of consolidated statement Financial expense -1,503,577 -7,212,820 79% Increase in interest expense Gains from changes of fair value 15,632,821 -76,006,380 121% Actual delivery cost was reckoned into investment gains, relevant losses of fair values of NDF contract which was confirmed at the end of last year were offset. Investment gains 3,915,704 87,734,540 -96% Shenzhen CM OCT Investment Co., Ltd. was changed from joint-ventured company to the subsidiary of the Company on Oct. 1, 2009, thus the investment gains on joint-ventured company in this report period reduced. Non-operating income 5,608,501 12,605,745 -56% Projected liabilities were switched back in the same period of last year Income tax expense 136,856,893 48,487,567 182% Increase in sales income of property caused the increase of taxes payable in the report period Minority shareholders’ gains and losses 96,940,770 -1,900,413 -5201% Increase in settlement profit of joint-ventured company caused the increase in minority shareholders’ gains 3.2 Analysis and explanation of significant events and their influence and solutions □Applicable √Inapplicable 3.3 Implementations of commitments by the Company, shareholders and actual controller √Applicable □Inapplicable Item of Commitments Promisee Content of commitments Implementation Commitments for Share Merger Reform Shekou Industrial Zone The Shekou Industrial Zone promised not to sell or transfer its own original non-outstanding shares within 24 months since the date when such shares obtained the right to be listed and traded (i.e. February 9, 2006); not to sell the total number of Within the report period, the Shekou Industrial Zone fulfilled the commitment strictly.China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 4 shares exceeding 5% of the total capital stock of the China Merchants Real Estate through the listed trades at Shenzhen Stock Exchange within 12 months after the expiration of the 24 months hereinabove; and not to sell the A-shares of the China Merchants Real Estate that it has at the price lower than 120% of the mean arithmetical value of closing prices for 30 trading days prior to the announcement of the Split-Share Reform Solution through listed trades at Shenzhen Stock Exchange within 36 months after the expiration of the above-mentioned 24 months. Commitments for share restricted trade Shekou Industrial Zone The Shekou Industrial Zone promised not to transfer the Company’s shares owned by it within 36 months since the completion of subscription of privately-issued shares of the Company on September 24, 2007. Within the report period, the Shekou Industrial Zone fulfilled the commitment strictly. Other commitments (including additional commitments) Shekou Industrial Zone The Shekou Industrial Zone promised to neither directly or indirectly conduct or develop the same or similar business or projects with that of the Company, nor found, develop, participate in, or assist any enterprise for Shekou Industrial Zone or on behalf of any related party or the third party to directly or indirectly compete with the Company; neither use the information obtained from the Company to conduct or participate in activities to compete with the Company, nor conduct any other competitive activity hurting or possibly hurting interests of the Company. Within the report period, the Shekou Industrial Zone fulfilled the commitment strictly. 3.4 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 □Applicable √Inapplicable 3.5 Other significant events which need explanations 3.5.1 Particulars about securities investmentChina Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 5 √Applicable □Inapplicable Unit: RMB No. Securitie s kinds Stock code Short form of the stock Initial investment amount (RMB) Amount held (Share) Book value at period-end (RMB) Total investment proportion of securities in period-end (%) Gains and losses in report period (RMB) 1 A shares 000004 ST Guonong 1,572,275.00 489,824.00 5,574,197.00 100.00% 0.00 Other stock investment held at the end of report period 0.00 - 0.00 0.00% 0.00 Gain/loss of the sold securities investment in the report period - - - - 0.00 Total 1,572,275.00 - 5,574,197.00 100% 0.00 3.5.2 Registration form for receiving research, communication and interview in the report period Date Place Method Investor Contents discussed and materials supplied Jan. 12, 2010 Shekou, Shenzhen Spot research China Securities Co., Ltd. Jan. 19, 2010 Shekou, Shenzhen Spot research Changjiang Securities Jan. 25, 2010 Shekou, Shenzhen Spot research Guotai Junan Securities Jan. 26, 2010 Shekou, Shenzhen Spot research Goldman Sachs Jan. 27, 2010 Shekou, Shenzhen Spot research Bohai Securities Feb. 5, 2010 Shekou, Shenzhen Spot research Customers from CITIC Securities Feb. 10, 2010 Shekou, Shenzhen Inquired in written form Investors Feb. 22, 2010 Shekou, Shenzhen Inquired in written form Investors Feb. 23, 2010 Shekou, Shenzhen Inquired in written form Investors March 1, 2010 Shekou, Shenzhen Spot research Guangzhou Securities March 2, 2010 Shekou, Shenzhen Spot research Daiwa Securities Group March31, 2010 Shekou, Shenzhen Spot research ESSENCE SECURITIES March 12, 2010 Shekou, Shenzhen Inquired in written form Investors March 15, 2010 Shekou, Shenzhen Inquired in written form Investors March 15, 2010 Shekou, Shenzhen Inquired in written form Individual investors March 18, 2010 Shekou, Shenzhen Spot research Zhongshan Securities Introduction to operations of the Company; discussion on development of industry; offered disclosed information and propaganda pamphlet on project of the Company.China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 6 March 22, 2010 Shekou, Shenzhen Inquired in written form Investors March 25, 2010 Shekou, Shenzhen Spot research Taishin Securities March 26, 2010 Shekou, Shenzhen Spot research Customers from J.P. MORGEN March 29, 2010 Shekou, Shenzhen Spot research Customers from UBS March 29, 2010 Shekou, Shenzhen Inquired in written form Investors March 31, 2010 Shekou, Shenzhen Inquired in written form Investors 3.5.3 Particulars about the explanations on other significant events √Applicable □Inapplicable 1. In the report period, the Company continued to provide phased joint guarantee for purchaser of commercial housing, the guarantee term was from the date of issuing loan from the mortgage bank to the date that the bank completed handling Certificate of Land Property for purchasers. If purchaser of commercial housing did not implement the debtors’ liabilities during the guarantee period, the Company had the rights to take back the sold houses, thus the guarantee could not cause actual losses to the Company. Ended as March 31, 2010, the Company provided guarantees RMB 137.06 million for the aforesaid guarantee. 2. Ended as March 31, 2010, the Company supplied joint liabilities guarantee for the bank loans of wholly-owned subsidiary—China Merchants Power Supply, the guarantee amount was USD 30 million(its equivalents to RMB 204.85 million). The guarantee period was expired from occurring day of loan to implementation of all the liquidation obligations in the loan contract. The Company supplied joint liabilities guarantee for the bank loans of controlling subsidiary—Zhuhai Yuanfeng Property Co., Ltd. (hereinafter refers to as Zhuhai Yuanfeng) and the guarantee amount was RMB 76.5 million. The guarantee period was from effective day of guarantee contract to 2 years later after the expiration of implementation period of liabilities in the loan contract. In the report period, it is never happen that the Company provide capital for controlling shareholders or related parties, and provide external guarantee disobeying regulations except the aforementioned items. 3.6 Particulars about derivatives investment √Applicable □Inapplicable Statement on risk analysis and control measures for position in derivatives within the report period (including but not limited to market, liquidity, credit, operational and law risks.) Within the report period, the main market risk of positions in derivatives was the influence of the market quotation fluctuation of Non-Deliverable Forward (NDF) trades on the fair value change of open contracts. However, the fundamental purpose of the Company to carry out NDF trades is to lock up exchange rates avoiding the exchange rate risk caused by borrowing foreign currency loans. Therefore, with true foreign exchange loans as the base of trades, the amounts and times of trades matched foreign exchange loans, covering the open of risks. The risks are controllable as the forward exchange rates are identified at the time when trades are happening. Being established by the Company, the trade-off system of financial derivatives restricts the types of financial derivatives whose trades the Company can participate inChina Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 7 and clearly provides for the trade size, approval authorization, operating process, risk control and supervision, and information disclosure of such a trade, systematically ensuring the control of trade risks. Changes in market price or fair value of invested derivatives within the report period; and the specific method and the set relevant assumptions and parameters that the Company used for analyzing fair values of derivatives shall be disclosed. As of end of 2009, the quotation of the one-year CNY/USD product in NDF market appreciated by approximately 2.12%; at end of March 2010, the quotation nearly appreciated 2.2% Expectation on NDF from Market was one with small extent appreciation on basic stability on exchange rate of Renminbi, the gains of fair value changes in first quarter of 2010 was RMB 15.63 million, the delivered NDF contract investment gains was RMB -6.98 million. The analysis to fair value of derivatives of the Company was adopted market method and fair value of derivatives was adjusted at the end of each month. Describe any significant change happening to the accounting policy and audit-specific principles of derivatives within the report period comparing with the last report period. N/A 3.6.1 Particulars about derivatives investment held at the end of report period √Applicable □Inapplicable Unit: RMB Contract kind Contract amount in period-begin Contract amount in period-end Gains/losses in the report period Proportion of contract amount in period-end in net assets at the end of report period Forward Exchange Transaction 1,981,741,658.00 2,387,493,688.00 8,649,415.00 14.33% Total 1,981,741,658.00 2,387,493,688.00 8,649,415.00 14.33% §4. Appendix 4.1 Balance sheet Prepared by China Merchants Properties Development Co., Ltd. March 31, 2010 Unit: RMB Balance at period-end Balance at year-begin Items Consolidation Parent Company Consolidation Parent Company Current assets: Monetary funds 8,074,523,883.00 5,422,242,742.00 9,489,490,935.00 6,268,540,842.00 Settlement provisions Capital lent Transaction finance asset 13,604,043.00 6,437,479.00 Notes receivable 4,990,000.00 Accounts receivable 74,654,727.00 118,962,896.00China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 8 Accounts paid in advance 6,154,439.00 8,747,313.00 Insurance receivable Reinsurance receivables Contract reserve of reinsurance receivable Interest receivable Dividend receivable 1,090,720,147.00 1,090,720,147.00 Other receivables 1,756,585,946.00 13,454,898,923.00 1,926,509,243.00 12,504,314,805.00 Purchase restituted finance asset Inventories 31,705,772,358.00 30,461,181,900.00 Non-current asset due within one year 26,754.00 26,754.00 0.00 Other current assets 564,559,273.00 624,800,651.00 Total current assets 42,200,871,423.00 19,967,861,812.00 42,636,157,171.00 19,863,575,794.00 Non-current assets: Granted loans and advances Finance asset available for sales 5,574,197.00 5,574,197.00 4,898,240.00 4,898,240.00 Held-to-maturity investment Long-term account receivable 1,077,217,117.00 939,437,754.00 1,062,146,037.00 924,366,671.00 Long-term equity investment 616,256,506.00 3,490,515,105.00 616,512,618.00 3,481,655,301.00 Investment property 2,754,696,975.00 2,787,842,250.00 Fixed assets 293,973,009.00 312,642.00 299,615,954.00 318,634.00 Construction in progress 18,335,830.00 19,254,007.00 Engineering material Disposal of fixed asset Productive biological asset Oil and gas asset Intangible assets 42,767.00 54,121.00 Expense on Research and Development Goodwill Long-term expenses to be apportioned 176,660,051.00 110,852.00 180,194,127.00 158,628.00 Deferred income tax asset 285,947,674.00 290,485,972.00 Other non-current asset Total non-current asset 5,228,704,126.00 4,435,950,550.00 5,261,003,326.00 4,411,397,474.00 Total assets 47,429,575,549.00 24,403,812,362.00 47,897,160,497.00 24,274,973,268.00 Current liabilities: Short-term loans 1,399,805,314.00 630,397,000.00 1,372,929,609.00 630,397,000.00 Loan from central bankChina Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 9 Absorbing deposit and interbank deposit Capital borrowed Transaction financial liabilities 4,377,347.00 12,829,413.00 Notes payable 235,464,115.00 257,896,108.00 Accounts payable 1,926,239,576.00 2,705,521,285.00 Accounts received in advance 9,430,033,544.00 9,498,461,291.00 Selling financial asset of repurchase Commission charge and commission payable Wage payable 84,069,999.00 1,352,442.00 162,832,982.00 6,052,306.00 Taxes payable 240,298,502.00 8,609,332.00 589,859,453.00 4,514,867.00 Interest payable 30,684,178.00 15,198,931.00 21,872,418.00 9,898,520.00 Dividend payable 46,196,258.00 107,751,887.00 Other accounts payable 4,988,884,317.00 3,892,946,100.00 5,835,329,987.00 3,928,393,230.00 Reinsurance payables Insurance contract reserve Security trading of agency Security sales of agency Non-current liabilities due within 1 year 1,428,402,300.00 750,000,000.00 1,303,501,721.00 650,000,000.00 Other current liabilities 1,977,640,165.00 77,559.00 1,843,563,001.00 77,559.00 Total current liabilities 21,792,095,615.00 5,298,581,364.00 23,712,349,155.00 5,229,333,482.00 Non-current liabilities: Long-term loans 6,688,002,089.00 4,173,128,000.00 5,720,303,012.00 4,123,128,000.00 Bonds payable Long-term account payable 48,442,069.00 46,469,703.00 Special accounts payable Projected liabilities 108,052,194.00 108,052,194.00 Deferred income tax liabilities 960,461.00 960,461.00 731,713.00 731,713.00 Other non-current liabilities 7,292,795.00 7,218,243.00 Total non-current liabilities 6,852,749,608.00 4,174,088,461.00 5,882,774,865.00 4,123,859,713.00 Total liabilities 28,644,845,223.00 9,472,669,825.00 29,595,124,020.00 9,353,193,195.00 Owner’s equity (or shareholders’ equity): Paid-in capital (or share capital) 1,717,300,503.00 1,717,300,503.00 1,717,300,503.00 1,717,300,503.00 Capital public reserve 8,488,374,112.00 8,930,974,884.00 8,487,926,904.00 8,930,527,676.00 Less: Inventory shares Reasonable reserve Surplus public reserve 785,793,010.00 734,841,617.00 785,793,010.00 734,841,617.00China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 10 Provision of general risk Retained profit 5,599,811,490.00 3,548,025,533.00 5,214,909,610.00 3,539,110,277.00 Balance difference of foreign currency translation 73,210,718.00 72,806,727.00 Total owner’s equity attributable to parent company 16,664,489,833.00 14,931,142,537.00 16,278,736,754.00 14,921,780,073.00 Minority interests 2,120,240,493.00 2,023,299,723.00 Total owner’s equity 18,784,730,326.00 14,931,142,537.00 18,302,036,477.00 14,921,780,073.00 Total liabilities and owner’s equity 47,429,575,549.00 24,403,812,362.00 47,897,160,497.00 24,274,973,268.00 4.2 Profit statement in the report period Prepared by China Merchants Properties Development Co., Ltd. Jan.-Mar. 2010 Unit: RMB Items ConsolidatioTnh is perPioadr ent Company ConsolidatioLna st periPoadr ent Company I. Total operating income 2,424,036,323.00 823,094,572.00 Including: Operating income 2,424,036,323.00 823,094,572.00 Interest income Insurance gained Commission charge and commission income II. Total operating cost 1,828,249,580.00 -1,280,504.00 629,758,991.00 -21,588,765.00 Including: Operating cost 1,443,764,646.00 -5,940,045.00 462,419,443.00 Interest expense Commission charge and commission expense Cash surrender value Net amount of expense of compensation Net amount of withdrawal of insurance contract reserve Bonus expense of guarantee slip Reinsurance expense Operating tax and extras 279,890,107.00 88,109,440.00 Sales expenses 55,215,258.00 48,031,506.00 Administration expenses 50,880,224.00 4,659,541.00 38,405,719.00 4,300,933.00 Financial expenses -1,503,577.00 -7,212,820.00 -25,889,608.00 Losses of devaluation of asset 2,922.00 5,703.00 Add: Changing income of fair value(Loss is listed with “-”) 15,632,821.00 -76,006,380.00 Investment income (Loss is listed with “-”) 3,915,704.00 9,997,288.00 87,734,540.00 8,064,384.00 Including: Investment income on affiliated company and joint venture -238,373.00 -1,140,195.00 37,293,000.00China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 11 Exchange income (Loss is listed with “-”) III. Operating profit (Loss is listed with “-”) 615,335,268.00 11,277,792.00 205,063,741.00 29,653,149.00 Add: Non-operating income 5,608,501.00 12,605,745.00 Less: Non-operating expense 2,244,226.00 503,277.00 Including: Disposal loss of non-current asset 72,672.00 190,055.00 IV. Total Profit (Loss is listed with “-”) 618,699,543.00 11,277,792.00 217,166,209.00 29,653,149.00 Less: Income tax 136,856,893.00 2,362,536.00 48,487,567.00 V. Net profit (Net loss is listed with “-”) 481,842,650.00 8,915,256.00 168,678,642.00 29,653,149.00 Net profit attributable to owner’s equity of parent company 384,901,880.00 8,915,256.00 170,579,055.00 29,653,149.00 Minority shareholders’ gains and losses 96,940,770.00 -1,900,413.00 VI. Earnings per share i. Basic earnings per share 0.2241 0.0993 ii. Diluted earnings per share 0.2241 0.0993 VII. Other consolidated income 851,199.00 447,208.00 -78,087.00 VIII. Total consolidated income 482,693,849.00 9,362,464.00 168,600,555.00 29,653,149.00 Total consolidated income attributable to owners of parent company 385,753,079.00 9,362,464.00 170,579,055.00 29,653,149.00 Total consolidated income attributable to minority shareholders 96,940,770.00 -1,978,500.00 4.3 Cash flow statement Prepared by China Merchants Properties Development Co., Ltd. Jan.-Mar. 2010 Unit: RMB Amount i Items Consolidation n thiPsa preenrito Cd ompany ConsolAidmatoiounn t in lasPta preenrito Cd o mpany I. Cash flows arising from operating activities: Cash received from selling commodities and providing labor services 2,376,845,424.00 1,907,252,226.00 Net increase of customer deposit and interbank deposit Net increase of loan from central bank Net increase of capital borrowed from other financial institution Cash received from original insurance contract fee Net cash received fromChina Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 12 reinsurance business Net increase of insured savings and investment Net increase of disposal of transaction financial asset Cash received from interest, commission charge and commission Net increase of capital borrowed Net increase of returned business capital Write-back of tax received 15,222,784.00 2,496.00 Other cash received concerning operating activities 282,302,017.00 73,708,970.00 511,295,947.00 Subtotal of cash inflow arising from operating activities 2,674,370,225.00 73,708,970.00 2,418,550,669.00 0.00 Cash paid for purchasing commodities and receiving labor service 2,144,687,245.00 340,000,000.00 1,608,732,603.00 Net increase of customer loans and advances Net increase of deposits in central bank and interbank Cash paid for original insurance contract compensation Cash paid for interest, commission charge and commission Cash paid for bonus of guarantee slip Cash paid to/for staff and workers 229,860,929.00 4,515,097.00 149,212,811.00 4,535,598.00 Taxes paid 632,574,717.00 296,099.00 293,683,061.00 59,112.00 Other cash paid concerning operating activities 461,106,503.00 671,751,687.00 272,309,929.00 732,577,450.00 Subtotal of cash outflow arising from operating activities 3,468,229,394.00 1,016,562,883.00 2,323,938,404.00 737,172,160.00 Net cash flows arising from operating activities -793,859,169.00 -942,853,913.00 94,612,265.00 -737,172,160.00 II. Cash flows arising from investing activities: Cash received from recovering investment Cash received from investment income Net cash received from disposal of fixed, intangible and other long-term assets 3,430.00 23,214.00 Net cash received from disposal of subsidiaries and other units Other cash received concerning investing activities 41,836,353.00China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 13 Subtotal of cash inflow from investing activities 3,430.00 41,859,567.00 0.00 Cash paid for purchasing fixed, intangible and other long-term assets 2,030,375.00 10,796,020.00 Cash paid for investment 28,125,469.00 Net increase of mortgaged loans Net cash received from subsidiaries and other units 4,000,000.00 Other cash paid concerning investing activities 6,977,067.00 Subtotal of cash outflow from investing activities 37,132,911.00 14,796,020.00 0.00 Net cash flows arising from investing activities -37,129,481.00 27,063,547.00 0.00 III. Cash flows arising from financing activities Cash received from absorbing investment Including: Cash received from absorbing minority shareholders’ investment by subsidiaries Cash received from loans 2,109,233,376.00 550,000,000.00 1,222,780,648.00 950,000,000.00 Cash received from issuing bonds Other cash received concerning financing activities Subtotal of cash inflow from financing activities 2,109,233,376.00 550,000,000.00 1,222,780,648.00 950,000,000.00 Cash paid for settling debts 989,658,613.00 400,000,000.00 1,340,066,114.00 937,756,100.00 Cash paid for dividend and profit distributing or interest paying 124,798,842.00 43,444,187.00 176,520,818.00 125,066,909.00 Including: Dividend and profit of minority shareholder paid by subsidiaries 61,556,629.00 Other cash paid concerning financing activities 889,447,969.00 Subtotal of cash outflow from financing activities 2,003,905,424.00 443,444,187.00 1,516,586,932.00 1,062,823,009.00 Net cash flows arising from financing activities 105,327,952.00 106,555,813.00 -293,806,284.00 -112,823,009.00 IV. Influence on cash and cash equivalents due to fluctuation in exchange rate -581,586.00 -150,831.00 2,386.00 V. Net increase of cash and cash equivalents -726,242,284.00 -836,298,100.00 -172,281,303.00 -849,992,783.00 Add: Balance of cash and cash equivalents at the period -begin 8,775,661,067.00 6,258,540,842.00 7,358,057,106.00 4,728,619,945.00 VI. Balance of cash and cash equivalents at the period -end 8,049,418,783.00 5,422,242,742.00 7,185,775,803.00 3,878,627,162.00China Merchants Property Development Co., Ltd. The First Quarterly Report 2010 (Full Text) 14 4.4 Auditor’ report Auditor’s opinions: Un-audited