Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Guangdong Provincial Expressway Development Co., Ltd. The Semi-Annual Report 2018 August 2018 1 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 I. Important Notice, Table of Contents and Definitions The Board of Directors and the directors, Supervisory Committee and supervisors and Senior Executives of the Company hereby warrant that at the year , there are no misstatement, misleading representation or important omissions in this report and shall assume joint and several liability for the authenticity, accuracy and completeness of the contents hereof. Mr.Zheng Renfa, Compant principal , Mr. Wang Chunhua, General Manager ,Mr.Fang Zhi, Chief of the accounting owrk, Ms.Zhou Fang, Chief of the accounting organ (chief of accounting ) hereby confirm the authenticity and completeness of the financial report enclosed in this Semi-annual report. All the directors have attended the meeting of the board meeting at which this report was examined. The toll revenues of Expressway is main source of the major business income of the company , The charge standard of vehicle toll must be submitted to the same level people's government for review and approval after the transport regulatory department of province, autonomous region or municipality directly under the central government in conjunction with the price regulatory department at the same level consented upon examination. Therefore, the adjustment trend of the charge price and the charge price if has the corresponding adjustment in the future price level when the cost of the company rises still depend on the approval of relevant national policies and government departments, and the company isn't able to make timely adjustment to the charge standard in accordance with the its own operation cost or the change of market supply demand. So, the change of charge policy and the adjustment of charge standard also have influence on the expressways operated by the company to some extent. So, the charging policy changes and charges adjustment will affect the highways operation of the company. The Company has no plan of cash dividends carried out, bonus issued and capitalizing of common reserves either. 2 Guangdong Provincial Expressway Development Co.., Ltd. The 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 3 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Definition Terms to be defined Refers to Definition Reporting period Refers to January 1, 2018 to June 30,2018 The semi annual report of the company was approved by the board of Reporting date Refers to directors on 2018, that is, August 27, 2018 YOY Refers to Compared with January-June 2017 The Company /This Company Refers to Guangdong Provincial Expressway Development Co.,Ltd. Technology Company Refers to Guangdong Expressway Technology Investment Co., Ltd Guangdong Provincial Expressway Development Co.,Ltd.Fokai Fokai Company Refers to Branch Guangfo Company Refers to Guangdong Guangfo Expressway Co., Ltd. Guangzhu East Company Refers to Jingzhu Expressway Guangzhu Section Co., Ltd. 4 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 II. Corporate Profile and Key Financial Indicators 1.Company Information Stock abbreviation: Expressway A, Expressway B Stock code: 000429、200429 Stock exchange for listing Shenzhen Stock Exchange Name in Chinese 广东省高速公路发展股份有限公司 Abbreviation of Registered 粤高速 Company (if any) English name (If any) Guangdong Provincial Expressway Development Co.Ltd. English abbreviation (If any) GPED Legal Representative \Zheng Renfa 2. Contact person and contact manner Board secretary Securities affairs Representative Name Yang Hanming Liang Jirong 46/F, Litong Plaza, No.32, Zhujiang East 45/F, Litong Plaza, No.32, Zhujiang East Contact address Road, Zhujiang New City, Tihe Disrtict , Road, Zhujiang New City, Tihe Disrtict , Guangzhou Guangzhou Tel 020-29004619 020-29004523 Fax 020-38787002 020-38787002 E-mail Hmy69@126.com 139221590@qq.com 3. Other 1. Way of contact Whether registrations address, offices address and codes as well as website and email of the Company changed in reporting period or not □ Applicable √ Not applicable Registrations address, offices address and codes as well as website and email of the Company has no change in reporting period, found more details in annual report 2017. 2. Information inquiry Whether information disclosure and preparation place changed in reporting period or not □ Applicable √ Not applicable 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. 4. Summary of Accounting Data and Financial Indicators Indicate by tick mark whether the Company needs to retroactively restate any of its accounting data. 5 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 □ Yes √No Reporting period Same period of last year YoY+/-(%) Operating income(yuan) 1,535,864,145.14 1,440,222,563.74 6.64% Net profit attributable to the shareholders 779,002,246.98 892,848,012.53 -12.75% of the listed company(yuan) Net profit after deducting of non-recurring gain/loss attributable to the shareholders of 752,917,711.53 892,848,012.53 -15.67% listed company(yuan) Cash flow generated by business operation, 817,279,588.10 1,022,392,235.37 -20.06% net(yuan) Basic earning per share(yuan/Share) 0.37 0.43 -13.95% Diluted gains per share(yuan/Share) 0.37 0.43 -13.95% Weighted average income/asset ratio(%) 8.60% 10.55% -1.95% As at the end of the As at the end of last year YoY+/-(%) reporting period Gross assets(yuan) 15,867,983,183.17 16,523,315,093.72 -3.97% Shareholders’ equity attributable to 8,674,276,291.67 9,023,071,118.45 -3.87% shareholders of the listed company(yuan) 5. Differences between accounting data under domestic and overseas accounting standards 1.Simultaneously pursuant to both Chinese accounting standards and international accounting standards disclosed in the financial reports of differences in net income and net assets. □ Applicable□√ Not applicable Nil 2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chinese accounting standards. □ Applicable √Not applicable Nil 6.Items and amount of non-current gains and losses √Applicable □Not applicable In RMB Items Amount Notes Non-current asset disposal gain/loss(including the write-off part 44,464,720.82 for which assets impairment provision is made) 6 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Amount Notes Other non-business income and expenditures other than the above 1,075,059.00 Less: Amount of influence of income tax 11,126,311.84 Amount of influence of minority interests(after tax) 8,328,932.53 Total 26,084,535.45 -- 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. □ Applicable√ Not applicable 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. 7 Guangdong Provincial Expressway Development Co.., Ltd. The 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 The Company is an infrastructure industry, with main business in developing and operating expressway and big bridges. It is one of the main institutions of developing expressway and big bridge in Guangdong Expressway System. The expressway industry is the industry helped by government. The Company is mainly engaged in tolling and maintenance of Guangfo Expressway, Fokai Expressway and Jingzhu Expressway Guangzhu Section investment in technological industries and provision of relevant consultation while investing in Shenzhen Huiyan Expressway Co., Ltd., Guangzhou Guanghui Expressway Co., Ltd.,Guangdong Jiangzhong Expressway Co., Ltd., Zhaoqing Yuezhao Expressway Co., Ltd.,Ganzhou Kangda Ex pressway , Ganzhou Gankang Expressway Co., Ltd.,Guangdong Yueke Technology Micro Loan Co., Ltd.and Guangdong Guangle Expressway Co.,Ltd. As of the end of the reporting period, the company’s share-controlled expressway is 158.12 km, and the share-participation expressway is 684.20 km, and according to the equity ratio, after the conversion calculation, the total mileage is 273.05 km. Ⅱ.Major Changes in Main Assets 1. Major Changes in Main Assets Main assets Major changes The increase of 3.91% by the end of the period compared with that of the beginning, Equity assets Mainly due to the combined influence of the operation accumulation and profit distribution of the participating units. The decrease of 6.58% by the end of the period compared with that of the beginning, Mainly due to the Zhuhai Municipal People's Government taking back the 4.213 km Fixed assets expressway of the Zhuhai section of the Guang'ao Expressway, the reduction of the road production of the Guangzhu East Company, and the depreciation of the road production. The decrease of 19.99% by the end of the period compared with that of the beginning, Intangible assets Mainly due to the impact of amortization of intangible assets. The increase of 76.79% by the end of the period compared with that of the beginning, Construction in process Mainly due to the increase in the construction of the southern section of Fokai Company. The increase of 699.69% by the end of the period compared with that of the beginning,, Mainly due to the Zhuhai Municipal People's Government recovering the 4.213 km Other receivable expressway of the Zhuhai section of the Guang'ao Expressway, and the increase in the receivables of the Guangzhu East Company by 106 million yuan. The amount was withdrawn on July 3, 2018. The decrease of 5.24% by the end of the period compared with that of the beginning, Available for sale financial assets Mainly due to the decline in the stock price of Everbright Bank, the value of 8 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 available-for-sale financial assets measured at fair value. The increase of 95.29% by the end of the period compared with that of the beginning, Other Non-current assets Mainly due to the increase and decrease of the prepaid project payment and the increase of the input tax to be deducted in the southern section of Fokai Company. The decrease of 16.14% by the end of the period compared with that of the beginning, Deferred income tax assets Mainly after the parent company absorbed the wholly-owned subsidiary, it made up for some deductible losses and the deferred income tax assets decreased accordingly 2. Main Conditions of Overseas Assets □ Applicable √ Not applicable Ⅲ.Analysis On core Competitiveness Whether the company needs to comply with the disclosure requirements of the particular industry No The toll revenue of expressway industry mainly depends on the regional economic development. The regional economy is the critical factor that influences the traffic volume. The Guangfo expressway and the Fokai expressway, controlled by the company, are part of the National Expressway Network Planning-“Five vertical and seven horizontal”, The share-controlled Beijing-Zhuhai Guangzhu Section Expressway is a fast and convenient expressway.and many of the company’s equity-participation expressways that are part of the main skeleton of the Guangdong Provincial Expressway Planning-“Ten vertical and five horizontal”, which provides a strong guarantee for stable traffic volume. Meanwhile, the regional economy is the critical factor that influences the traffic volume, as Guangdong province is the economically developed region, with years’ continuous high growth of GDP, so that provides the stable rising demand for the company. IV. Performance Discussion and Analysis Ⅰ.General The Company is an infrastructure industry, with main business in developing and operating expressway and big bridges. It is one of the main institutions of developing expressway and big bridge in Guangdong Expressway System. The expressway industry is the industry helped by government. In the first half of 2018, the company, according to the annual business plan established by the board of directors, soundly did a good job of each work. . In the first half of 2018, the main business income was 1.536 billion yuan, up by 6.64% over the same period of last year, meaning 47.60% of the annual plan was completed; and the operating costs was 534 million yuan, Flat year-on-year, representing completed 40.27% of the annual plan. In the report period, the vehicle traffic and toll income of the controlled subsidiaries and joint ventures of the Company are as follows: Volume of vehicle Increase Toll income in the Increase 9 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 traffic in the first /Decrease(%) first half year of /Decrease(% half year of 2018(Ten 2018(Ten thousand) thousand vehicles) Guangfo Expressway 2,953.85 1.50% 22,523.45 13.30% Fokai Expressway 3,281.51 17.32% 63,859.17 8.37% Jingzhu Expressway Guangzhu 3,642.16 2.99% 63,529.98 2.40% East Section Huiyan Expressway 2,046.44 11.95% 12,174.57 9.14% Guanghui Expressway 2,783.87 10.83% 86,784.97 2.54% Yuezhao Expressway 1,454.50 7.42% 26,279.69 7.14% Jiangzhong Expressway 2,574.42 2.84% 22,967.71 5.92% Guangle Expressway 1,151.82 18.54% 152,842.70 6.41% Kangda Expressway 127.01 0.02% 11,305.54 -6.73% Gangkang Expressway 187.22 35.72% 7,677.39 18.87% Overall situation: During the reporting period, the participating and controlled expressways in Guangdong Province continued to maintain a steady growth trend, with traffic volume and toll revenue increasing year-on-year; the traffic volume of two expressways in Jiangxi increased, but the toll revenue increased year-on-year and one year decreased. 1. Guangfo Expressway was affected by the implementation of restricted trucks in Foshan First Ring Road. The number of trucks increased year-on-year, so the increase in toll revenue was higher than the increase in traffic volume; 2. Guangzhu Section of Jingzhu Expressway. In September 2017, the National Road Hongqili Bridge was restored to traffic. Affected by this, the traffic volume and toll revenue increased slightly year-on-year; 3. Kangda Expressway was closed by the renovation project of the 323 National Road, and some of the trucks were diverted. The toll revenue decreased. II.Main business analysis Refer to relevant contents of “1.Summarization” in “Discussion and Analysis of Management” Year-on-year change of main financial data In RMB Same period last YOY This report period Cause change year change(%) Mainly due to the growth of Guangfo, Fokai and Operating income 1,535,864,145.14 1,440,222,563.74 6.64% Guangzhu East Company Toll revenue Operating cost 533,736,566.35 533,689,845.16 0.01% Administrative expenses 75,594,633.97 77,693,914.84 -2.70% Financial expenses 112,780,215.47 133,804,359.02 -15.71% Mainly to repay the upfront borrowings and 10 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Same period last YOY This report period Cause change year change(%) increase the capitalization of the loan expansion and expansion of the southern part of the Fokai Expressway, and reduce the interest expense on financial expenses for the current period. Mainly in the previous period, the merger and acquisition of Fokai subsidiary confirmed the Income tax expenses 213,221,718.85 -19,940,081.98 1,169.31% deferred income tax assets, and the current income tax expense is relatively large. Mainly due to the increase in toll income; the Department absorbed the merger of Fokai Cash flow generated by Company, Fokai Company to pay the assessed 817,279,588.10 1,022,392,235.37 -20.06% business operation, net value of assets and the difference between the previous road production accounting and tax depreciation. Mainly due to the payment of the reconstruction Net cash flow generated -138,624,695.43 -3,331,892.02 -4,060.54% and expansion project of the southern section of by investment Fokai Expressway. Mainly due to distribution of dividends for the Net cash flow generated -1,217,963,569.09 -1,027,513,171.72 -18.54% period increased compared with the same period by financing last year. Net cash from operating activities by the inflow Net increasing of cash -541,576,561.05 -7,005,743.86 -7,630.47% and outflow from investing activities due to the and cash equivalents combined effects Major changes to the profit structure or sources of the Company in the reporting period □ Applicable √Not applicable Nil Breakdown of main business In RMB Increase/decrease Increase/decrease Increase/decrease of principal of gross profit of reverse in the Operating Gross profit business cost over rate over the operating costs same period of revenue rate(%) the same period same period of the previous of previous year the previous year year(%) (%) (%) Industry Highway 1,499,126,119.71 504,925,795.77 66.32% 6.44% -2.52% 3.09% transportations Other 19,749,732.85 17,392,198.77 11.94% 92.62% 216.42% -34.46% 11 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Total 1,518,875,852.56 522,317,994.54 65.61% 7.06% -0.22% 2.51% Product Highway 1,499,126,119.71 504,925,795.77 66.32% 6.44% -2.52% 3.09% transportations Other 19,749,732.85 17,392,198.77 11.94% 92.62% 216.42% -34.46% Total 1,518,875,852.56 522,317,994.54 65.61% 7.06% -0.22% 2.51% Area Guangfo 225,234,633.20 27,776,820.78 87.67% 13.30% -53.54% 17.74% Expressway Fokai 638,591,636.62 306,517,460.99 52.00% 8.37% 5.28% 1.41% Expressway Jingzhu Expressway 635,299,849.89 170,631,514.00 73.14% 2.40% 2.15% 0.06% Guangzhu section Other 19,749,732.85 17,392,198.77 11.94% 92.62% 216.42% -34.46% Total 1,518,875,852.56 522,317,994.54 65.61% 7.06% -0.22% 2.51% III.Non-core business analysis √ Applicable □Not applicable In RMB Amount Ratio in total profit Note Whether be sustainable It is due to the operation Investment income 259,358,302.20 23.33% accumulation of participant Yes companies It is due to the provision of Asset impairment -57,890.35 -0.01% impairment for receivables No surplus and aging changes Mainly due to the compensation for the demolition of the office of Non-operating 2,687,560.58 0.24% the technology company and No income the income of the road production claim of Fokai Branch Mainly due to the damage repair of civil facilities of Non-operating 2,007,967.43 0.18% Guangzhu East Company No expenses and the scrapping expenses of other companies' fixed 12 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 assets The proporty of Guangzhou-Zhuhai East Company has decreased mainly due to the Zhuhai Assets disposal Government has recovered 44,860,186.67 4.03% No income the 4.213 kilometers expressway of Guangzhou-Macao Expressway of Zhuhai Section. IV.Analysis of assets and liabilities 1.Significant changes in asset composition In RMB End of Reporting period End of same period of last year As a As a Change in percentage percentage percentage Reason for significant change Amount Amount of total of total (%) assets(%) assets(%) Net cash from operating activities by the Monetary fund 1,821,466,139.37 11.48% 2,363,042,700.42 14.30% -2.82% inflow and outflow from investing activities due to the combined effects Accounts 94,111,175.70 0.59% 92,642,625.45 0.56% 0.03% receivable Inventories 139,076.49 0.001% 0.00% 0.001% Real estate 2,523,650.98 0.02% 2,755,757.68 0.02% 0.00% Investment Long-term equity 3,166,390,849.09 19.95% 3,047,275,000.00 18.44% 1.51% investment It is mainly due to the Zhuhai Municipal People's Government taking back the 4.213 km expressway of the Zhuhai Fixed assets 7,945,714,512.39 50.07% 8,505,434,890.71 51.48% -1.41% section of the Guang'ao Expressway, the reduction of the road production of the Guangzhu East Company Construction in Mainly due to the increase in the 629,469,949.60 3.97% 356,062,655.95 2.15% 1.82% process construction of the south section of Fokai 13 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Company. Short-term loans 0.00% 0.00% 0.00% Long-term loans 4,391,170,000.00 27.67% 4,744,170,000.00 28.71% -1.04% 2.Asset and Liabilities Measured by Fair Value √ Applicable □Not applicable In RMB Gain/Loss on Cumulative fair Impairment Purchanased fair value Sold amount in Opening value change provisions in amount in the Items change in the the reporting Closing mount amount recorded into the repoting reporting reporting period equity period period period Financial assets 3.Available-for -sale financial 952,782,523.20 -91,749,428.16 343,472,218.24 861,033,095.04 assets Subtotal of 952,782,523.20 -91,749,428.16 343,472,218.24 861,033,095.04 financial assets Total of the 952,782,523.20 -91,749,428.16 343,472,218.24 861,033,095.04 above Financial 0.00 0.00 liabilities Did any significant change occur to the attribute of the Company’s main asset measurement during the reporting period? □ Yes √No 14 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 3. Assets right restriction till end of reporting period Nil V.Investment situation 1. General √ Applicable □ Not applicable Investments made in same period of last Investments made in the reporting period +/- % year 273,407,293.65 51,617,786.58 429.68% 2.Condition of Acquiring Significant Share Right Investment during the Report Period □ Applicable √ Not applicable 3.Situation of the Significant Non-equity Investment Undergoing in the Report Period √ Applicable □ Not applicable In RMB Reasons for Accumulat failure ed realized Industry in Accumulated in Form Fixed Investment return as Date of which the actual amount Estima meeting of assets amount during Source of the end Disclosu Disclosure Name investment invested as of the Progress ted schedule invest investme the reporting of und of the end re(If Index(If any) project end of reporting return d ment nt or not period of the any) operates period progress reporting and period estimate d return Announceme nt of the 29th (Provisional) Sanbao To Self Meeting of Shuikou Expresswa and June the seventh Section Self Yes 273,407,293.65 1,000,061,046.58 29.19% 0.00 0.00 Nil y Borro 17,2016 Board of Extension wing Directors, project Announceme nt of External Investment Total -- -- -- 273,407,293.65 1,000,061,046.58 -- -- 0.00 0.00 -- -- -- 15 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 4.Investment of Financial Asset (1)Securities investment √ Applicable □ Not applicable Purc Mod Sale hase Book e of amo Stoc amo value acco Book value unt Gain/loss of Security Secur k Changes in fair Cumulative fair unt balance at Sauce Initial unti balance at the in the Accountin categor ity Abb value of the this value changes in in the end of of the investment cost ng beginning of the the reporting g items y code revia period equity the the shares mea reporting period this period tion: this reporting sure peri peri period ment od od Ever Domest Financial brig ic and 6018 FV -91,749,428 861,033,0 assets ht 517,560,876.80 952,782,523.20 -91,749,428.16 343,472,218.24 Self foreign 18 M .16 95.04 available Ban stocks for sale k -91,749,428 861,033,0 Total 517,560,876.80 -- 952,782,523.20 -91,749,428.16 343,472,218.24 0.00 0.00 -- -- .16 95.04 Disclosure Date of Announcement on Securities July 22, 2009 Investment Approved by the Board of Directors Disclosure Date of Announcement on Securities Investment August 7,2009 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. 16 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 VI. Sales of major assets and equity 1. Sales of major assets □ Applicable √ Not applicable The Company had no sales of major assets in the reporting period. 2.Sales of major equity □ Applicable √ Not applicable 17 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 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 Compa Operating Company Name Leading products and services Registered capital Total assets Net assets Operating profit Net Profit ny type Income Operating Guangfo Expressway Co., Subsidi Ltd.(starts from Hengsha, Guangzhou, ends Guangfo Expressway 200 million yuan 493,251,686.30 437,494,174.52 226,325,833.32 187,512,995.52 142,435,343.71 ary in Xiebian, Foshan. Total length 15.7 kilometers Guangzhu Traffic Subsidi Highway investment management and Investment Management 3 million yuan 2,744,739,947.35 540,806,925.21 645,871,184.09 453,365,316.41 184,814,435.35 ary consultation; highway maintenance Co., Ltd. Jingzhu Expressway Subsidi The operation and management of Jiangzhu 580 million yuan 2,679,733,292.93 974,182,310.50 645,871,184.09 453,401,008.00 336,091,139.89 Guangzhu Section Co., Ltd. ary Expressway Guangzhu Section Investment in and construction of Guanghui Expressway Co., Ltd. and supporting facilities, the toll collection and maintenance management of Guanghui Sharing Guangdong Guanghui Expressway, The Guanghui 2.352 billion compan 4,869,370,504.08 3,500,636,180.02 878,931,209.54 598,371,964.24 447,126,957.50 Expressway Co., Ltd. Expressway's supporting gas station, yuan y salvation, vehicle maintenance, vehicle transport, catering, warehousing investment and development Subsidiaries obtained or disposed in the reporting period □ Applicable √ Not applicable 18 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Particulars about the Mutual holding companies 1.The Company holds a 75% equity interest in the Guangfo company, the construction and operation of the Guangzhou-Foshan Expressway, including road maintenance, charges, signs, marking and other transport facilities maintenance, Vehicle rescue and other business. The current net profit increased by 44.0569 million yuan, an increase of 44.78%, the increasing is due to natural income growth and financial costs to reduce the combined impact. The main reason for the increase is the combined effect of the following factors: (1)The number of trucks has increased and the toll revenue has increased; (2) The depreciation of Guangfo Expressway has been fully drawn in the current reporting period, so that led to a decrease in depreciation. 2. The main reason for the increase was the combined effect of the natural increase of the toll revenue and the reduction of the financial costs. The net profits in the current period increased 48.8131million yuan and 14.99% compared with the last period,The main reason for the increase is the following factors: (1) According to the Compensation and Asset Transfer Agreement of Zhuhai Municipal People's Government's Recovery of the Guang-ao Expressway Zhuhai Section (Pile No. K0+945---K5+158), Guangzhu Dong Company has received all the compensation of 206 million yuan for the equity value compensation of the asset transfer and has completed the transfer of the asset with the Zhuhai High-tech Zone Management Committee in accordance with the “Compensation and Asset Transfer Agreement”;(2) the natural growth of toll income; (3) the interest-bearing debt repayment led to reduced financial costs. VIII.Structured vehicle controlled by the Company □ Applicable √ Not applicable 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. □ Applicable √ Not applicable X.Risks facing the Company and countermeasures The company’s profits mainly come from the expressway tolls revenue and the toll charging standards shall be examined by the traffic authority of the provincial, autonomous region and the direct-controlled municipality people’s governments together with the same-level pricing authority and then submitted to the same-level people’s government for approval. Therefore, the charging price adjustment trend and the possibility of the charging price adjustment upon rising of the commodity price and the company cost in the future are still subject to relevant national policies and the approval of the governmental department. And the company can’t adjust the charging standards promptly based on its own operation cost or the market supply-demand changes. In conclusion, the charging policies change and the charging standards adjustment have the influence on the expressway business of the company to some extent. 19 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 V. Important Events I. Annual General Meeting and Provisional Shareholders’ Meetings in the Reporting Period 1.Annual General Meeting Investor Index to disclosed Meeting Type Convened date Disclosure date participation ratio information Annual 2017 Shareholders’ Shareholders’ 66.27% April 26,2018 April 27,2018 www.cinfo.com.cn general meeting General Meeting 2. Preferred stockholders restored voting rights to request to convene Provisional Shareholders’ Meeting. □Applicable√Not applicable II. Proposal for profit distribution and converting capital Reserve into share actual for the reporting period □ Applicable √Not applicable 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. □ Applicable √Not applicable There is no commitment that has not been fulfilled by actual controller, shareholders, related parties, acquirers of the Company IV. Particulars about engagement and disengagement of CPAs firm Whether the semi-annual financial report had been audited? □ Yes √ No Not been audited. V.Explanations given by board of directors and supervisory board regarding “ Modified auditor’s” Issued by CPAs firm for the reporting period □ Applicable √ Not applicable 20 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 VI. Explanations given by Board of Directors regarding“ Modified auditor’ Report”Issued for last year □ Applicable √ Not applicable VII. Bankruptcy and restructuring □ Applicable √ Not applicable No such cases in the reporting period. VIII. Legal matters Signifieant lawsuits or arbitrations □ Applicable √ Not applicable No such cases in the reporting period. Other legal matters √ Applicable □ Not applicable Litigation Forming Litigation (arbitratio Date Amount Litigation Index of of the (arbitration) n) of Basic conditions of litigation (arbitration) involved (Ten (arbitration) disclosu predicted judgement result judgement disclo thousand yuan ) progress re debt and influence execution sure condition On August 22, 2007, Guangdong Fokai Expressway Co., Ltd. filed a lawsuit with Guangzhou Maritime Court officially requiring Foshan Nanhai Yuhang Shipping Co., Ltd. and Yang Xiong to undertake the joint and several liabilities for the toll losses of Fokai company due to the Jiujiang collapse. On March 7, 2014, the court made the first instance judgement No major requiring the defendants Foshan Nanhai Yuhang Waiting for the influence on the Shipping Co., Ltd. and Yang Xiong to court company asset compensate the defendant Guangdong Fokai 1,935.75 No None judgement conditions and Expressway Co., Ltd. jointly for the vehicle toll result the operation revenue loss totaling 19,357,500.96 yuan. results. Guangdong Higher People's Court entered a judgement on June 5, 2014 and the lawsuit terminated. By the end of the report period, the abatement of action causes are already removed and the provincial higher court restores the hearing and conducts the investigation on April 21, 2017. Now it’s still the time waiting for the court judgement. 21 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 On June 12, 2009, the 6.15 accident-causing boat owner Yang Xiong filed a lawsuit with Guangzhou Maritime Court requiring Fokai company to compensate for the boat loss and interest totaling 7.28 million yuan. On No major During December 20, 2013, the court made the first influence on the abatement of instance judgement rejecting all litigation company asset 728.00 No action by the None claims of Yang Xiong. He filed a lawsuit with conditions and second Guangdong Higher People's Court against such the operation instance sentence above, and the second instance results. terminated the lawsuit in May 2015. By the end of the report period, the lawsuit is still suspended without any notice from the provincial higher court. IX. Punishments and rectifications □ Applicable √ Not applicable No such cases in the reporting period. X. Credit conditions of the Company as well as its Controlling shareholder and actual Controller □ Applicable √ Not applicable XI.Equity incentive plans, employee stock ownership plans or other incentive measures for employees □ Applicable √ Not applicable No such cases in the reporting period. XII.Material related transactions 1. Related transactions in connection with daily operation □ Applicable √ Not applicable No such cases in the reporting period. 2. Related-party transactions arising from asset acquisition or sold □Applicable √ Not applicable No such cases in the reporting period. 3. Related-party transitions with joint investments □Applicable √ Not applicable 22 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 No such cases in the reporting period. 4. Credits and liabilities with related parties √ Applicable □Not applicable Whether has non-operational contact of related liability and debts or not □ Yes √ No No such cases in the reporting period. 5. Other significant related-party transactions √ Applicable □Not applicable 1.The 16th (provisional) meeting of the Eighth board of directors of the Company examined and adopted the Proposal about Singing the Contract of Entrustment of Operation and Management of 2018-2020 of Guangzhu North Section of Guangdong Jingzhu Expressway between the Guangzhu Section Company and the Guangzhu North Section Company.Agreed that Jingzhu Expressway Guangzhu Section Co., Ltd signs the Contract of Entrustment of Operation and Management of 2018-2020 of Guangzhu North Section of Guangdong Jingzhu Expressway with the Guangdong Jingzhu Expressway Guangzhu North Section Co., Ltd, with the total contract amount not exceeding 60 million yuan. 2. The 16th (provisional) meeting of the Eighth board of directors of the Company examined and adopted the Proposal of Signing the Contract of Operation Entrustment of Un-Pillar Advertisement between the Jingzhu Expressway Guangzhu Section Co., Ltd and the Guangdong High Speed Media Co., Ltd.Agreed that Jingzhu Expressway Guangzhu Section Co., Ltd signs the Contract of Operation Entrustment of Un-Pillar Advertisement of Guangzhu Section of Beijing-Zhuhai Expressway with Guangdong High Speed Media Co., Ltd. 3. The 16th (provisional) meeting of the Eighth board of directors of the Company examined and adopted the Proposal about the Entrustment of Lease and Operation of Communication Pipe along the Expressways of Guangdong Provincial Expressway Development Co.,Ltd’s Holding Subsidiaries and Branch Company.Agreed that Our subsidiaries-Guangfo Expressway Co., Ltd and Jingzhu Expressway Guangzhu Section Co., Ltd and our branch company-Guangdong Provincial Expressway Development Co., Ltd Fokai Branch sign the Communication Pipeline Lease Contract with the Guangdong Litong Technology Investment Co., Ltd, which is to entrust the communication pipeline ( including main line , ramp , structure and auxiliary facilities ) along the expressway under the jurisdiction to Guangdong Litong Technology Investment Co.,Ltd for external lease and 23 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 maintenance, with the total lease income of about 79.27 million yuan. 4. The 17th (provisional) meeting of the Eighth board of directors of the Company Examined and Adopted of the Proposal on Borrowing Entrusted Loans to Guangdong Guanghui Expressway Co., Ltd.Agreed that the company borrowed entrusted loans from Guangdong Guanghui Expressway Co., Ltd. The total amount of loans was 180 million yuan. According to the actual needs of the company, withdrawals were made for a period of 1 year, and the interest rate was lowered by 10% according to the benchmark interest rate of the People's Bank of China for the same period. Used to supplement working capital. After the entrusted loan expires, it can be renewed according to the original conditions. 5. The 17th (provisional) meeting of the Eighth board of directors of the Company examined and adopted the Proposal Concerning the Company Daily Associated Transactions Predicted of 2018. Agree on the predicted daily associated transactions for the company headquarters, wholly-owned and holding subsidiaries of 2018, whose amount in total is 63.1779 million yuan. The website to disclose the interim announcements on significant related-party transactions Date of disclosing provisional Description of the website for disclosing Description of provisional announcement announcement provisional announcements Announcement of Resolutions of the 16th (provisional)Meeting of the Eighth Board of January 31,2018 www.cninfo.com.cn Directors Announcement on related party transactions January 31,2018 www.cninfo.com.cn entrusted by subsidiaries Announcement on Related Transactions of Entrusted Leasing Operation of Communication Pipeline along the January 31,2018 www.cninfo.com.cn Expressway of Guangdong Expressway Holding Subsidiary and Branch Announcement on Related Transactions of Non-column Advertising Entrusted Operation January 31,2018 www.cninfo.com.cn of Holding Subsidiary Beijing-Zhuhai Expressway Guangzhu Section Co., Ltd. Announcement of Resolutions of the 17th (provisional) Meeting of the Eighth Board of March 29,2018 www.cninfo.com.cn Directors Related transaction announcement March 29,2018 www.cninfo.com.cn 24 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Announcement of Daily Associated March 29,2018 www.cninfo.com.cn Transactions Predicted of 2018 XIII. Particulars about the non-operating occupation of funds by the Controlling shareholder and other related parties of the Company □Applicable √ Not applicable 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 □Applicable √ Not applicable No such cases in the reporting period. (2)Contracting □Applicable √ Not applicable No such cases in the reporting period. (3)Leasing □Applicable √ Not applicable No such cases in the reporting period. 2.Contracting □Applicable √ Not applicable 2.Guarantees √Applicable□Not applicable (1)Guarantees Ten thousand yuan Extemal guarantess made by the Company(Exclude those made for subsidiaries) Name of the Relevant Amount of Date of Actual Complete Guarantee Guarantee type Guarantee term Company disclosure Guarantee happening mount of implementa for 25 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 date/No. of (Date of guarantee tion associated the signing or not parties guaranteed agreement) (Yes or no) amount Guangdong May 2012.9.25-20 Communication 172,500 May 31,2013 172,500 Martgage No Yes 11,2012 21.7.25 Group Co.,Ltd Total balance of actual Total of external guarantee 172,500 external guarantee at 172,500 approved at Period-end(A3) Period-end(A4) Guarantee of the Company for the controlling subsidiaries Guarante Relevant e Date of Complete disclosure for Name of the Amount happening Actual implemen date/No. of Guarantee Guarantee associate Company of (Date o mount of tation the type term d guaranteed guarantee signing guarantee or guaranteed parties agreement) not amount (Yes or no) Guarantee of the subsidiaries for the controlling subsidiaries Guarante Relevant e Date of Complete disclosure for Name of the Amount happening Actual implemen date/No. of Guarantee Guarantee associate Company of (Date o mount of tation the type term d guaranteed guarantee signing guarantee or guaranteed parties agreement) not amount (Yes or no) Total of Company’s guarantee(namely total of the large three aforementioned) Total of guarantee at Period-end Total of actual guarantee at 172,500 172,500 (A3+B3+C3) Period-end (A4+B4+C4) The proportion of the total amount of actually guarantee in the 19.89% net assets of the Company(that is A4+B4+C4) Including Amount of guarantee for shareholders, actual controller and its 172,500 associated parties(D) Description of the guarantee with complex method 26 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (2)Illegal external guarantee □ Applicable √ Not applicable Nil 3. Other significant contract □ Applicable √ Not applicable Nil XV.Social responsibilities 1.Major environmental protection The Listed Company and its subsidiary whether belongs to the key sewage units released from environmental protection department No 2.Overview of the annual targeted poverty alleviation The company has no precise social responsibility for poverty alleviation in theperiodand bas no follow-up plan either. XVI.Other material events □Applicable √ Not applicable No such cases in the reporting period. XVII. Material events of subsidiaries √Applicable□Not applicable The 15th (provisional) meeting of the Eighth board of directors of the Company examined and adopted the Proposal of matters relevant to the Zhuhai Municipal People's Government's Taking-back of Guangzhou-Macao Expressway Zhuhai Section's 4.213 km Expressway asset compensation and asset transfer" was examined and approved. 1. Agreed that Zhuhai High-tech Zone Management Committee uses 206 million yuan of compensation (excluding the relevant taxes and fees, and the taxes and fees compensation subjecting to the actual amount of payment) to take back the Guangdong-Macao Expressway Zhuhai Section's 4.213 km (Pile Number K0 +945-K5 +158)Expressway Asset. 27 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 2. Agreed that Jingzhu Expressway Guangzhu section Co., Ltd-the company's holding subsidiary-shall, after performed the relevant decision-making procedures, enter into the Compensation and Asset transfer Agreement with Zhuhai High-Tech Zone Management Committee. On January 31, 2018, Beijing-Zhuhai Expressway Guangzhu Section Co., Ltd. received the first compensation of RMB 100 million from Zhuhai High-tech Zone Management Committee. On July 3, 2018, Beijing-Zhuhai Expressway Guangzhu Section Co., Ltd. received the equity value compensation amount of RMB 106 million for the asset transfer from Zhuhai High-tech Zone Management Committee. As of that date, Guangzhu Dong Company has received all the compensation of RMB 260 million for the equity value compensation of the asset transfer and has completed the transfer of the asset with the Zhuhai High-tech Zone Management Committee in accordance with the “Compensation and Asset Transfer Agreement”. Description of the website for Date of disclosing Description of provisional announcement disclosing provisional provisional announcement announcements Announcement of Resolutions of the 15th (Provisional) Meeting of December 30,2017 www.cninfo.com.cn the Eighth Board of Directors Announcement of matters relevant to the Zhuhai Municipal December 30,2017 www.cninfo.com.cn People's Government's Taking-back of Guangzhou-Macao Expressway Zhuhai Section's 4.213 km Expressway asset compensation and asset transfer" Progress Announcement of matters relevant to the Zhuhai February 2,2018 www.cninfo.com.cn Municipal People's Government's Taking-back of Guangzhou-Macao Expressway Zhuhai Section's 4.213 km Expressway asset compensation and asset transfer" Progress Announcement of matters relevant to the Zhuhai July 5,2018 www.cninfo.com.cn Municipal People's Government's Taking-back of Guangzhou-Macao Expressway Zhuhai Section's 4.213 km Expressway asset compensation and asset transfer" 28 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 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 Share ation of Bonus allotm common Other Subtotal Quantity Proportion shares ent reserve fund 1.Shares with conditional 1,273,170,302 60.88% 132,126 132,126 1,273,302,428 60.90% subscription 1.State-owned shares 410,002,853 19.61% 410,002,853 19.61% 2.State-owned legal 521,393,021 24.94% 521,393,021 24.94% person shares 3.Other domestic shares 341,774,428 16.34% 132,126 132,126 341,906,554 16.35% Including :Domestic 341,225,786 16.32% -120,440 -120,440 341,105,346 16.31% Legal person shares Domestic natural person 548,642 0.03% 252,566 252,566 801,208 0.04% shares II.Shares with 817,635,824 39.11% -132,126 -132,126 817,503,698 39.10% unconditional subscription 1.Common shares in 468,885,824 22.43% -30,801 -30,801 468,855,023 22.42% RMB 2.Foreign shares in 348,750,000 16.68% -101,325 -101,325 348,648,675 16.68% domestic market III. Total of capital shares 2,090,806,126 100.00% 0 0 2,090,806,126 100.00% Reasons for share changed √ Applicable □Not applicable 1. During the reporting period, 120,440 “domestic legal-person holding shares” were turned into “domestic natural-person holding shares” through judicial confirmation. 2. During the reporting period, due to changes in the appointments of directors, supervisors and senior executives and changes in shareholdings in the previous year, 30,801 A shares and 101,325 B shares were converted from "unlimited conditional shares" to "limited conditional shares". Approval of Change of Shares □ Applicable √ Not applicable Ownership transfer of share changes □ Applicable √ Not applicable 29 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable to common shareholders of Company in latest year and period □ Applicable √ Not applicable Other information necessary to disclose for the company or need to disclosed under requirement from security regulators □ Applicable √ Not applicable 2. Change of shares with limited sales condition √ Applicable □Not applicable In shares Number of Number of Restricted Shares Date of Shareholder Initial Restricted Increased Reason for Unrestricted in the End of the Restriction Name Shares Restricted Shares Restricted Shares Shares This Term Term Removal This Term Executive locking Wang Chunhua 0 0 101,325 101,325 Unknown stock Executive locking September Li Mei 92,494 0 30,801 123,205 stock 30,2018 Total 92,494 0 132,126 224,530 -- -- II.Issuing and listing □ Applicable √ 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 61,104 0 voting right at the end of the reporting period reporting period (if any) (note 8) Particulars about shares held above 5% by shareholders or top ten shareholders Number of share Proportion Number of Changes in Amount of Amount of pledged/frozen Nature of Shareholders of shares shares held at reporting restricted un-restricted State shareholder held(%) period -end period shares held shares held of Amount share Guangdong State-owned legal 24.55% 513,382,595 410,002,853 103,379,742 Communication Group person 30 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Co.,Ltd Guangdong Highway State-owned legal 22.30% 466,325,020 466,325,020 Construction Co., Ltd, person Domestic non Yadong Fuxing Yalian State-owned 9.68% 202,429,149 202,429,149 Pledge 156,652,500 Investment Co., Ltd. Legal person Tibet Yingyue Domestic non Investment Management State-owned 4.84% 101,214,574 101,214,574 Co., Ltd. Legal person Guangdong Expressway State-owned legal 2.53% 52,937,491 52,937,491 Co., Ltd. person Domestic non Guangfa Securities Co., State-owned 1.45% 30,364,372 30,364,372 Ltd. Legal person Domestic natural Feng Wuchu 1.08% 22,593,729 1175773 person shares Agricultural Bank of China-Jingshun Great Domestic non Wall Energy State-owned 0.69% 14,381,528 7403434 Infrastructure Mixed Legal person Securities Investment Fund Foreign legal Xinyue Co., Ltd. 0.63% 13,201,086 person PRUSIK UMBRELLA Foreign legal 0.62% 12,999,871 1000000 UCITS FUND PLC person Guangdong Communication Group Co., Ltd. is the parent company of Guangdong Highway Construction Co., Ltd, Guangdong Expressway Co., Ltd. and Xinyue Co., Ltd.. It is unknown Explanation on associated relationship or whether there is relationship between other shareholders and whether they are persons taking concerted action of the above shareholders concerted action specified in the Regulations on Disclosure of Information about Change in Shareholding of Shareholders of Listed Companies. Shareholding of top 10 shareholders of unrestricted shares Quantity of unrestricted shares held at the end of the Share type Name of the shareholder reporting period Share type Quantity RMB Common Guangdong Communication Group Co.,Ltd 103,379,742 103,379,742 shares RMB Common 20,686,390 Feng Wuchu 22,593,729 shares Foreign shares 1,907,339 31 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 placed in domestic exchange Agricultural Bank of China-Jingshun RMB Common Great Wall Energy Infrastructure Mixed 14,381,528 14,381,528 shares Securities Investment Fund Foreign shares Xinyue Co., Ltd. 13,201,086 placed in domestic 13,201,086 exchange Foreign shares PRUSIK UMBRELLA UCITS FUND PLC 12,999,871 placed in domestic 12,999,871 exchange Foreign shares MATTHEWS CHINA DIVIDEND FUND 11,565,121 placed in domestic 11,565,121 exchange Foreign shares Khazanah Nasional Berhad-self fund 10,522,779 placed in domestic 10,522,779 exchange Foreign shares UBS AG LONDON BRANCH 9,129,156 placed in domestic 9,129,156 exchange RMB Common Guotai Junan securities co., Ltd. 7,600,000 7,600,000 shares Yongan Guofu Asset Management Co., Ltd. RMB Common -Yongan Guofu-Yongfu No.10 Private 7,255,301 7,255,301 shares Securities Investment Fund Explanation on associated relationship or Guangdong Communication Group Co., Ltd. is the parent company of Guangdong Highway consistent action among the top 10 Construction Co., Ltd, Guangdong Expressway Co., Ltd. and Xinyue Co., Ltd.. It is unknown shareholders of non-restricted negotiable whether there is relationship between other shareholders and whether they are persons taking shares and that between the top 10 concerted action specified in the Regulations on Disclosure of Information about Change in shareholders of non-restricted negotiable Shareholding of Shareholders of Listed Companies. shares and top 10 shareholders Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period. □ Yes √ No The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company have no buy –back agreement dealing in reporting period. IV. Change of the controlling shareholder or the actual controller Change of the controlling shareholder in the reporting period □ Applicable √ Not Applicable 32 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 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 □ Applicable √ Not applicable There was no any change of the actual controller of the Company in the reporting period. 33 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 VII. Situation of the Preferred Shares □Applicable √Not applicable The Company had no preferred shares in the reporting period 34 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 VIII. Information about Directors, Supervisors and Senior Executives I. Change in shares held by directors, supervisors and senior executives □Applicable√Not applicable There was no change in shareholding of directors, supervisors and senior management staffs, for the specific information please refer to the 2017 Annual Report II. Change in shares held by directors, supervisors and senior executives √ Appicable □Not applicable Name Positions Types Date Reason Li Mei Supervisor Dimission January 6,2018 Resignation 35 Guangdong Provincial Expressway Development Co.., Ltd. The 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 annual report No 36 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 X. Financial Report I. Audit report Has this semi-annual report been audited? □Yes √No The semi-annual report was not audited. II. Financial statements Currency unit for the statements in the notes to these financial statements: RMB 1. Consolidated balance sheet Prepared by::Guangdong Provincial Expressway Development Co., Ltd. In RMB Items At the end of term Beginning of term Current asset: Monetary fund 1,821,466,139.37 2,363,042,700.42 Settlement provision Outgoing call loan Financial assets measured at fair value with variations accounted into current income account Derivative financial assets Note receivable Account receivable 94,111,175.70 92,642,625.45 Prepayments 1,734,012.97 4,451,901.75 Insurance receivable Reinsurance receivable Provisions of Reinsurance contracts receivable Interest receivable Dividend receivable 54,521,442.76 Other account receivable 123,275,981.57 15,415,512.07 37 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items At the end of term Beginning of term Repurchasing of financial assets Inventories 139,076.49 Assets held for sales Non-current asset due in 1 year 51,745.32 55,669.14 Other current asset 921,856.82 76,576.08 Total of current assets 2,096,221,431.00 2,475,684,984.91 Non-current assets: Loans and payment on other’s behalf disbursed Disposable financial asset 1,659,608,196.77 1,751,357,624.93 Expired investment in possess Long-term receivable Long term share equity investment 3,166,390,849.09 3,047,275,000.00 Property investment 2,523,650.98 2,755,757.68 Fixed assets 7,945,714,512.39 8,505,434,890.71 Construction in progress 629,469,949.60 356,062,655.95 Engineering material 1,549,556.00 1,549,556.00 Fixed asset disposal 99,127.90 Production physical assets Gas & petrol Intangible assets 5,677,752.19 7,096,435.17 R & D petrol Goodwill Long-germ expenses to be amortized 37,107.43 92,768.83 Differed income tax asset 281,196,704.39 335,299,025.28 Other non-current asset 79,494,345.43 40,706,394.26 Total of non-current assets 13,771,761,752.17 14,047,630,108.81 Total of assets 15,867,983,183.17 16,523,315,093.72 Current liabilities Short-term loans Loan from Central Bank Deposit received and hold for others Call loan received 38 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items At the end of term Beginning of term Financial liabilities measured at fair value with variations accounted into current income account Derivative financial liabilities Note payable Account payable 185,313,470.18 266,934,026.99 Advance payment 13,605,059.97 14,856,113.90 Selling of repurchased financial assets Fees and commissions receivable Employees’ wage payable 15,529,808.87 11,334,182.16 Tax payable 122,832,730.78 428,647,394.29 Interest payable 9,332,172.79 8,494,355.93 Dividend payable 43,193,409.32 26,840,792.20 Other account payable 255,598,874.65 86,663,237.94 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 1,583,780,000.00 1,218,610,000.00 Other current liability 689,978.75 Total of current liability 2,229,875,505.31 2,062,380,103.41 Non-current liabilities: Long-term loan 4,391,170,000.00 4,744,170,000.00 Bond payable Including:preferred stock Sustainable debt Long-term payable 2,022,210.11 2,022,210.11 Long-term payable employees’s remuneration Special payable Expected liabilities Deferred income Deferred income tax liability 217,720,054.84 260,632,098.75 39 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items At the end of term Beginning of term Other non-current liabilities Total non-current liabilities 4,610,912,264.95 5,006,824,308.86 Total of liability 6,840,787,770.26 7,069,204,412.27 Owners’ equity Share capital 2,090,806,126.00 2,090,806,126.00 Other equity instruments Including:preferred stock Sustainable debt Capital reserves 2,514,016,125.31 2,510,069,749.76 Less:Shares in stock Other comprehensive income 253,468,274.62 327,263,824.17 Special reserves Surplus reserves 544,821,130.03 544,821,130.03 Common risk provision Undistributed profit 3,271,164,635.71 3,550,110,288.49 Total of owner’s equity belong to the 8,674,276,291.67 9,023,071,118.45 parent company Minority shareholders’ equity 352,919,121.24 431,039,563.00 Total of owners’ equity 9,027,195,412.91 9,454,110,681.45 Total of liabilities and owners’ equity 15,867,983,183.17 16,523,315,093.72 Legal Representative:Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting:Fang Zhi Accounting Dept Leader: Zhou Fang 40 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 2.Parent Company Balance Sheet In RMB Items At the end of term Beginning of term Current asset: Monetary fund 1,708,673,405.68 2,130,475,892.67 Financial assets measured at fair value with variations accounted into current income account Derivative financial assets Note receivable Account receivable 18,091,636.66 19,001,899.29 Prepayments 764,205.44 1,520,014.23 Interest receivable 35,705,395.50 2,070,385.95 Dividend receivable 189,521,442.76 10,000,000.00 Other account receivable 171,173,507.07 5,298,202.17 Inventories Assets held for sales Non-current asset due in 1 year 80,000,000.00 80,000,000.00 Other current asset Total of current assets 2,203,929,593.11 2,248,366,394.31 Non-current assets: Disposable financial asset 1,659,608,196.77 1,751,357,624.93 Expired investment in possess Long-term receivable Long term share equity investment 8,336,053,068.75 8,216,937,219.66 Property investment 2,271,512.73 2,503,619.43 Fixed assets 5,516,223,107.41 5,784,192,105.58 Construction in progress 627,266,163.60 353,858,869.95 Engineering material Fixed asset disposal Production physical assets Gas & petrol Intangible assets 2,220,339.19 2,856,323.67 41 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items At the end of term Beginning of term R & D petrol Goodwill Long-germ expenses to be amortized Differed income tax asset 280,995,263.90 335,050,091.31 Other non-current asset 866,288,609.57 827,775,329.66 Total of non-current assets 17,290,926,261.92 17,274,531,184.19 Total of assets 19,494,855,855.03 19,522,897,578.50 Current liabilities Short-term loans Financial liabilities measured at fair value with variations accounted into current income account Derivative financial liabilities Note payable Account payable 148,300,692.93 200,070,986.17 Advance payment Employees’ wage payable 4,267,948.00 5,419,848.48 Tax payable 6,843,982.81 12,893,797.03 Interest payable 8,793,589.48 7,901,914.26 Dividend payable 18,193,409.32 14,340,792.20 Other account payable 4,671,807,377.66 4,481,086,033.30 Liabilities held for sales Non-current liability due in 1 year 1,333,780,000.00 968,610,000.00 Other current liability 575,976,776.28 644,691,748.64 Total of current liability 6,767,963,776.48 6,335,015,120.08 Non-current liabilities: Long-term loan 4,192,170,000.00 4,545,170,000.00 Bond payable Including:preferred stock Sustainable debt Long-term payable 2,022,210.11 2,022,210.11 Employees’ wage payable Special payable Expected liabilities 42 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items At the end of term Beginning of term Deferred income Deferred income tax liability 85,868,054.56 108,805,411.60 Other non-current liabilities Total of Non-current liabilities 4,280,060,264.67 4,655,997,621.71 Total of liability 11,048,024,041.15 10,991,012,741.79 Owners’ equity Share capital 2,090,806,126.00 2,090,806,126.00 Other equity instrument Including:preferred stock Sustainable debt Capital reserves 2,925,904,356.93 2,921,957,981.38 Less:Shares in stock Other comprehensive income 253,468,274.62 327,263,824.17 Special reserves Surplus reserves 528,976,846.38 528,976,846.38 Undistributed profit 2,647,676,209.95 2,662,880,058.78 Total of owners’ equity 8,446,831,813.88 8,531,884,836.71 Total of liabilities and owners’ equity 19,494,855,855.03 19,522,897,578.50 Legal Representative:Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting:Fang Zhi Accounting Dept Leader: Zhou Fang 3.Consolidated Income statement In RMB Items Report period Same period of the previous year I. Income from the key business 1,535,864,145.14 1,440,222,563.74 Incl:Business income 1,535,864,145.14 1,440,222,563.74 Interest income Insurance fee earned Fee and commission received 43 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Report period Same period of the previous year II. Total business cost 728,906,640.43 752,280,475.16 Incl:Business cost 533,736,566.35 533,689,845.16 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 6,853,114.99 6,895,775.06 Sales expense Administrative expense 75,594,633.97 77,693,914.84 Financial expenses 112,780,215.47 133,804,359.02 Asset impairment loss -57,890.35 196,581.08 Add:Gains from change of fir value (“-”for loss) Investment gain(“-”for loss) 259,358,302.20 223,430,364.44 Incl: investment gains from affiliates 216,777,157.34 199,376,107.62 Gains from currency exchange(“-”for loss) Assets disposal income 44,860,186.67 Other income III. Operational profit(“-”for loss) 1,111,175,993.58 911,372,453.02 Add :Non-operational income 2,687,560.58 62,299,078.58 Less:Non business expenses 2,007,967.43 3,099,474.26 IV.Total profit(“-”for loss) 1,111,855,586.73 970,572,057.34 Less:Income tax expenses 213,221,718.85 -19,940,081.98 V. Net profit 898,633,867.88 990,512,139.32 1.Net continuing operating profit 898,633,867.88 990,512,139.32 2.Termination of operating net profit Net profit attributable to the owners of 779,002,246.98 892,848,012.53 parent company Minority shareholders’ equity 119,631,620.90 97,664,126.79 VI. Other comprehensive income -73,795,549.55 -75,869,719.44 44 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Report period Same period of the previous year Net of profit of other comprehensive inco me attributable to owners of the parent co -73,795,549.55 -75,869,719.44 mpany. (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit pla ns of changes in net debt or net assets 2.Other comprehensive income under the equity method investee can not be reclass ified into profit or loss. (II) Other comprehensive income that will be -73,795,549.55 -75,869,719.44 reclassified into profit or loss. 1.Other comprehensive income under the equity method investee can be reclassifie -4,983,478.43 d into profit or loss. 2.Gains and losses from changes in fair v -68,812,071.12 -75,869,719.44 alue available for sale financial assets 3.Held-to-maturity investments reclassifi ed to gains and losses of available for sal e financial assets 4.The effective portion of cash flow hedg es and losses 5.Translation differences in currency fina ncial statements 6.Other Net of profit of other comprehensive inco me attributable to Minority shareholders’ equity VII. Total comprehensive income 824,838,318.33 914,642,419.88 Total comprehensive income attributable 705,206,697.43 816,978,293.09 to the owner of the parent company Total comprehensive income attributable 119,631,620.90 97,664,126.79 minority shareholders VIII. Earnings per share (I)Basic earnings per share 0.37 0.43 45 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Report period Same period of the previous year (II)Diluted earnings per share 0.37 0.43 The current business combination under common control, the net profits of the combined party before achieved ne t profit of RMB 0.00, last period the combined party realized RMB0.00. Legal Representative:Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting:Fang Zhi Accounting Dept Leader: Zhou Fang 4. Income statement of the Parent Company In RMB Items Report period Same period of the previous year I. Income from the key business 675,894,267.74 38,224,276.41 Incl:Business cost 310,310,687.32 232,106.70 Business tax and surcharge 3,493,775.90 45,569.27 Sales expense Administrative expense 42,233,003.03 26,557,947.35 Financial expenses 104,206,424.94 66,857,722.21 Asset impairment loss Add:Gains from change of fir value (“-”for loss) Investment gain(“-”for loss) 880,579,568.71 930,734,790.73 Incl: investment gains from affiliates 216,777,157.34 199,376,107.62 Assets disposal income 138,427.18 Other income II. Operational profit(“-”for loss) 1,096,368,372.44 875,265,721.61 Add :Non-operational income 916,331.99 73,878.42 Less:Non business expenses 485,826.09 III.Total profit(“-”for loss) 1,096,798,878.34 875,339,600.03 Less:Income tax expenses 54,054,827.41 -220,270,567.14 IV. Net profit(“-”for net loss) 1,042,744,050.93 1,095,610,167.17 1.Net continuing operating profit 1,042,744,050.93 1,095,610,167.17 2.Termination of operating net profit 46 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Report period Same period of the previous year 5. After-tax net amount of other misc. -73,795,549.55 -75,869,719.44 incomes (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit pl ans of changes in net debt or net assets 2.Other comprehensive income under th e equity method investee can not be recl assified into profit or loss. (II) Other comprehensive income that will b -73,795,549.55 -75,869,719.44 e reclassified into profit or loss. 1.Other comprehensive income under th e equity method investee can be reclassi -4,983,478.43 fied into profit or loss. 2.Gains and losses from changes in fair -68,812,071.12 -75,869,719.44 value available for sale financial assets 3.Held-to-maturity investments reclassif ied to gains and losses of available for s ale financial assets 4.The effective portion of cash flow hed ges and losses 5.Translation differences in currency fin ancial statements 6.Other VI. Total comprehensive income 968,948,501.38 1,019,740,447.73 VII. Earnings per share (I)Basic earnings per share (II)Diluted earnings per share Legal Representative:Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting:Fang Zhi Accounting Dept Leader: Zhou Fang 47 Guangdong Provincial Expressway Development Co.., Ltd. The 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 1,567,523,150.21 1,437,384,420.88 rending of services 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 Other cash received from business 39,446,329.98 60,818,976.35 operation Sub-total of cash inflow 1,606,969,480.19 1,498,203,397.23 Cash paid for purchasing of 96,705,259.73 65,216,674.54 merchandise and services 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 48 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Report period Same period of the previous year Cash paid to staffs or paid for staffs 138,291,293.37 132,850,018.53 Taxes paid 532,821,606.22 241,335,946.56 Other cash paid for business activities 21,871,732.77 36,408,522.23 Sub-total of cash outflow from business 789,689,892.09 475,811,161.86 activities Cash flow generated by business 817,279,588.10 1,022,392,235.37 operation, net II.Cash flow generated by investing Cash received from investment retrieving Cash received as investment gains 84,683,907.47 137,278,324.19 Net cash retrieved from disposal of fixed assets, intangible assets, and other 100,573,025.00 6,250.00 long-term assets Net cash received from disposal of subsidiaries or other operational units Other investment-related cash received 59,995,667.68 Sub-total of cash inflow due to 185,256,932.47 197,280,241.87 investment activities Cash paid for construction of fixed assets, intangible assets 323,881,627.90 200,612,133.89 and other long-term assets Cash paid as investment Net increase of loan against pledge Net cash received from subsidiaries and other operational units Other cash paid for investment activities Sub-total of cash outflow due to 323,881,627.90 200,612,133.89 investment activities Net cash flow generated by investment -138,624,695.43 -3,331,892.02 III.Cash flow generated by financing Cash received as investment Incl: Cash received as investment from minor shareholders Cash received as loans 800,000,000.00 499,000,000.00 49 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Report period Same period of the previous year Cash received from bond placing Other financing –related ash received 2,500,000.00 Sub-total of cash inflow from financing 802,500,000.00 499,000,000.00 activities Cash to repay debts 637,830,000.00 678,100,000.00 Cash paid as dividend, profit, or 1,382,633,569.09 848,413,171.72 interests Incl: Dividend and profit paid by 185,252,062.66 subsidiaries to minor shareholders Other cash paid for financing activities Sub-total of cash outflow due to 2,020,463,569.09 1,526,513,171.72 financing activities Net cash flow generated by financing -1,217,963,569.09 -1,027,513,171.72 IV. Influence of exchange rate -2,267,884.63 1,447,084.51 alternation on cash and cash equivalents V.Net increase of cash and cash -541,576,561.05 -7,005,743.86 equivalents Add: balance of cash and cash 2,363,042,700.42 2,603,279,644.25 equivalents at the beginning of term VI ..Balance of cash and cash 1,821,466,139.37 2,596,273,900.39 equivalents at the end of term Legal Representative:Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting:Fang Zhi Accounting Dept Leader: Zhou Fang 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 661,994,572.24 3,621,896.95 rending of services Tax returned 50 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Amount in this period Amount in last period Other cash received from business 46,329,459.08 616,912,385.89 operation Sub-total of cash inflow 708,324,031.32 620,534,282.84 Cash paid for purchasing of 39,912,969.27 merchandise and services Cash paid to staffs or paid for staffs 55,205,264.99 16,270,436.06 Taxes paid 25,922,199.03 550,122.41 Other cash paid for business activities 402,529,977.62 27,384,975.76 Sub-total of cash outflow from business 523,570,410.91 44,205,534.23 activities Cash flow generated by business 184,753,620.41 576,328,748.61 operation, net II.Cash flow generated by investing Cash received from investment retrieving Cash received as investment gains 580,905,173.98 718,997,791.68 Net cash retrieved from disposal of fixed assets, intangible assets, and other 195,540.00 long-term assets Net cash received from disposal of subsidiaries or other operational units Other investment-related cash received 432,250.00 70,491,251.01 Sub-total of cash inflow due to 581,532,963.98 789,489,042.69 investment activities Cash paid for construction of fixed assets, intangible assets 312,406,878.23 and other long-term assets Cash paid as investment Net cash received from subsidiaries and other operational units Other cash paid for investment 10,000,000.00 activities Sub-total of cash outflow due to 312,406,878.23 10,000,000.00 investment activities Net cash flow generated by investment 269,126,085.75 779,489,042.69 III.Cash flow generated by financing 51 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Amount in this period Amount in last period Cash received as investment Cash received as loans 400,000,000.00 Cash received from bond placing Other financing –related ash received 293,500,000.00 Sub-total of cash inflow from 693,500,000.00 financing activities Cash to repay debts 50,100,000.00 50,100,000.00 Cash paid as dividend, profit, or 1,142,614,308.52 775,861,281.94 interests Other cash paid for financing activities 374,200,000.00 Sub-total of cash outflow due to 1,566,914,308.52 825,961,281.94 financing activities Net cash flow generated by financing -873,414,308.52 -825,961,281.94 IV. Influence of exchange rate -2,267,884.63 1,447,084.51 alternation on cash and cash equivalents V.Net increase of cash and cash -421,802,486.99 531,303,593.87 equivalents Add: balance of cash and cash 2,130,475,892.67 1,795,455,123.88 equivalents at the beginning of term VI ..Balance of cash and cash 1,708,673,405.68 2,326,758,717.75 equivalents at the end of term Legal Representative:Zheng Renfa General Manager: Wang Chunhua Person in charge of accounting:Fang Zhi Accounting Dept Leader: Zhou Fang 52 Guangdong Provincial Expressway Development Co.., Ltd. The 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 instrument Minor Items Speci Commo Less: Other Total of owners’ alized Surplus n risk shareholders’ Share Capital prefe Capital reserves Shares Comprehensive Attributable profit equity Sustai Othe reser reserves provisio equity rred in stock Income nable r ve n stock debt I.Balance at the end of last 2,090,806,126.00 2,510,069,749.76 327,263,824.17 544,821,130.03 3,550,110,288.49 431,039,563.00 9,454,110,681.45 year Add: Change of accounting policy Correcting of previous errors Merger of entities under common control Other II.Balance at the beginning 2,090,806,126.00 2,510,069,749.76 327,263,824.17 544,821,130.03 3,550,110,288.49 431,039,563.00 9,454,110,681.45 of current year III.Changed in the current 3,946,375.55 -73,795,549.55 -278,945,652.78 -78,120,441.76 -426,915,268.54 year (1)Total comprehensive -73,795,549.55 779,002,246.98 119,631,620.90 824,838,318.33 income (II)Investment or 53 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in this period Owner’s equity Attributable to the Parent Company Other Equity instrument Minor Items Speci Commo Less: Other Total of owners’ alized Surplus n risk shareholders’ Share Capital prefe Capital reserves Shares Comprehensive Attributable profit equity Sustai Othe reser reserves provisio equity rred in stock Income nable r ve n stock debt decreasing of capital by owners 1 . Ordinary Shares investe d by shareholders 2 . Holders of other equity i nstruments invested capital 3.Amount of shares paid and accounted as owners’ equity 4.Other (III)Profit allotment -1,057,947,899.76 -197,752,062.66 -1,255,699,962.42 1.Providing of surplus reserves 2.Providing of common risk provisions 3.Allotment to the owners -1,057,947,899.76 -197,752,062.66 -1,255,699,962.42 (or shareholders) 4.Other (IV) Internal transferring of 54 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in this period Owner’s equity Attributable to the Parent Company Other Equity instrument Minor Items Speci Commo Less: Other Total of owners’ alized Surplus n risk shareholders’ Share Capital prefe Capital reserves Shares Comprehensive Attributable profit equity Sustai Othe reser reserves provisio equity rred in stock Income nable r ve n stock debt 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 1. Provided this year 2.Used this term (VI)Other 3,946,375.55 3,946,375.55 IV. Balance at the end of this 2,090,806,126.00 2,514,016,125.31 253,468,274.62 544,821,130.03 3,271,164,635.71 352,919,121.24 9,027,195,412.91 term 55 Guangdong Provincial Expressway Development Co.., Ltd. The 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 Speci Commo Minor Items Total of owners’ Less: Other prefe alized n risk shareholders’ Share Capital Capital reserves Shares Comprehensive Surplus reserves Attributable profit equity rred Sustai Othe reserv provisio equity in stock Income stoc nable r e n k debt I.Balance at the end of 2,090,806,126.00 2,508,408,342.99 402,285,954.24 366,956,549.89 2,920,563,328.27 554,495,287.40 8,843,515,588.79 last year Add: Change of accounting policy Correcting of previous errors Merger of entities under common control Other II.Balance at the beginning of current 2,090,806,126.00 2,508,408,342.99 402,285,954.24 366,956,549.89 2,920,563,328.27 554,495,287.40 8,843,515,588.79 year III.Changed in the -123,455,724.4 1,661,406.77 -75,022,130.07 177,864,580.14 629,546,960.22 610,595,092.66 current year 0 (1)Total -75,022,130.07 1,509,922,398.70 200,301,288.72 1,635,201,557.35 comprehensive income 56 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in last year Owner’s equity Attributable to the Parent Company Other Equity instrument Speci Commo Minor Items Less: Other Total of owners’ alized n risk shareholders’ prefe equity Share Capital Capital reserves Shares Comprehensive Surplus reserves Attributable profit reserv provisio equity rred Sustai Othe in stock Income stoc nable r e n k debt (II)Investment or decreasing of capital by owners 1 . Ordinary Shares inv ested by shareholders 2.Holders of other equ ity instruments invested capital 3.Allotment to the owners (or shareholders) 4.Other (IV) Internal -323,757,013.1 transferring of owners’ 177,864,580.14 -880,375,438.48 -1,026,267,871.46 2 equity 1. Capitalizing of capital reserves (or to 177,864,580.14 -177,864,580.14 capital shares) 2. Capitalizing of 57 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in last year Owner’s equity Attributable to the Parent Company Other Equity instrument Speci Commo Minor Items Less: Other Total of owners’ alized n risk shareholders’ prefe equity Share Capital Capital reserves Shares Comprehensive Surplus reserves Attributable profit reserv provisio equity rred Sustai Othe in stock Income stoc nable r e n k debt surplus reserves (or to capital shares) 3.Making up losses by -323,757,013.1 -702,510,858.34 -1,026,267,871.46 surplus reserves. 2 4. Other (VI )Special reserves 1. Provided this year 2.Used this term (VII)Other IV. Balance at the end of this term (V) Special reserves 1. Provided this year 2.Used this term (VI)Other 1,661,406.77 1,661,406.77 IV. Balance at the end 2,090,806,126.00 2,510,069,749.76 327,263,824.17 544,821,130.03 3,550,110,288.49 431,039,563.00 9,454,110,681.45 of this term 58 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 8.Statement of change in owner’s Equity of the Parent Company Amount in this period 59 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 In RMB Amount in this period Other Equity instrument Less: Other Items Shares Specialize Total of owners’ Share Capital preferre Capital reserves Comprehensive Surplus reserves Attributable profit Sustaina Other in d reserve equity d stock Income ble debt stock I.Balance at the end of 2,090,806,126.00 2,921,957,981.38 327,263,824.17 528,976,846.38 2,662,880,058.78 8,531,884,836.71 last year Add: Change of accounting policy Correcting of previous errors Other II.Balance at the beginning of current 2,090,806,126.00 2,921,957,981.38 327,263,824.17 528,976,846.38 2,662,880,058.78 8,531,884,836.71 year III.Changed in the 3,946,375.55 -73,795,549.55 -15,203,848.83 -85,053,022.83 current year (I)Total -73,795,549.55 1,042,744,050.93 968,948,501.38 comprehensive income (II) Investment or decreasing of capital by owners 1 . Ordinary Shares inv ested by shareholders 60 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in this period Other Equity instrument Less: Other Items Shares Specialize Total of owners’ Share Capital preferre Capital reserves Comprehensive Surplus reserves Attributable profit Sustaina Other in d reserve equity d stock Income ble debt stock 2 .Holders of other equ ity instruments invested capital 3.Amount of shares paid and accounted as owners’ equity 4.Other (III)Profit allotment -1,057,947,899.76 -1,057,947,899.76 1.Providing of surplus reserves 2.Allotment to the owners (or -1,057,947,899.76 -1,057,947,899.76 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 61 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in this period Other Equity instrument Less: Other Items Shares Specialize Total of owners’ Share Capital preferre Capital reserves Comprehensive Surplus reserves Attributable profit Sustaina Other in d reserve equity d stock Income ble debt stock capital shares) 3.Making up losses by surplus reserves. 4. Other (V) Special reserves 1. Provided this year 2.Used this term (VI)Other 3,946,375.55 3,946,375.55 IV. Balance at the end of 2,090,806,126.00 2,925,904,356.93 253,468,274.62 528,976,846.38 2,647,676,209.95 8,446,831,813.88 this term Amount in last year In RMB Amount in last year Other Equity instrument Less: Other Items Shares Specialize Total of owners’ Share Capital preferre Capital reserves Comprehensive Surplus reserves Attributable profit Sustaina Other in d reserve equity d stock Income ble debt stock I.Balance at the end of last 2,090,806,126.00 3,359,791,693.12 402,285,954.24 351,112,266.24 1,764,609,695.85 7,968,605,735.45 62 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in last year Other Equity instrument Less: Other Items Shares Specialize Total of owners’ Share Capital preferre Capital reserves Comprehensive Surplus reserves Attributable profit Sustaina Other in d reserve equity d stock Income ble debt stock year Add: Change of accounting policy Correcting of previous errors Other II.Balance at the beginning 2,090,806,126.00 3,359,791,693.12 402,285,954.24 351,112,266.24 1,764,609,695.85 7,968,605,735.45 of current year III.Changed in the current -437,833,711.74 -75,022,130.07 177,864,580.14 898,270,362.93 563,279,101.26 year (I)Total comprehensive -75,022,130.07 1,778,645,801.41 1,703,623,671.34 income (II) Investment or decreasing of capital by -437,833,711.74 -437,833,711.74 owners 1 . Ordinary Shares investe d by shareholders 2 .Holders of other equity i nstruments invested capital 3.Amount of shares paid and accounted as owners’ 63 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in last year Other Equity instrument Less: Other Items Shares Specialize Total of owners’ Share Capital preferre Capital reserves Comprehensive Surplus reserves Attributable profit Sustaina Other in d reserve equity d stock Income ble debt stock equity 4.Other -437,833,711.74 -437,833,711.74 (III)Profit allotment 177,864,580.14 -880,375,438.48 -702,510,858.34 1.Providing of surplus 177,864,580.14 -177,864,580.14 reserves 2.Allotment to the owners -702,510,858.34 -702,510,858.34 (or 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 1. Provided this year 64 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in last year Other Equity instrument Less: Other Items Shares Specialize Total of owners’ Share Capital preferre Capital reserves Comprehensive Surplus reserves Attributable profit Sustaina Other in d reserve equity d stock Income ble debt stock 2.Used this term (VI)Other IV. Balance at the end of 2,090,806,126.00 2,921,957,981.38 327,263,824.17 528,976,846.38 2,662,880,058.78 8,531,884,836.71 this term 65 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 III.Company Profile (1)History The Company was established in February 1993, which was originally named as Guangdong Fokai Expressway Co., Ltd. On June 30, 1993, it was renamed as Guangdong Provincial Expressway Development Co., Ltd. after reorganization pursuant to the approval of the Office of Joint Examination Group of Experimental Units of Share Holding System with YLSB (1993)No. 68 document. The share capital structure after reorganization is as follows: Composition of state-owned shares: The appraised net value of state-owned assets of Guangdong Jiujiang Bridge Co. and Guangfo Expressway Co., Ltd. as of January 31, 1993 confirmed by Guangdong State-owned Asset Management Dept., i.e., 418.2136 million yuan, was converted into 155.025 million shares. Guangdong Expressway Co. invested cash of 115 million yuan to subscribe for 35.9375 million shares. Other legal persons invested cash of 286.992 million yuan to subscribe for 89.685 million shares. Staff of the Company invested 87.008 million yuan to subscribe for 27.19 million shares. The total is 307.8375 million shares. 2. Pursuant to the approval of Guangdong Economic System Reform Committee and Guangdong Securities Regulatory Commission with YTG (1996) No. 67 document, part of the shareholders of non-state-owned legal person shares transferred 20 million non-state-owned legal person shares to Malaysia Yibao Engineering Co., Ltd. in June 1996. 3. Pursuant to the approval of Securities Commission under the State Council with WF (1996) No. 24 approval document and that of Guangdong Economic System Reform Committee with YTG (1996) No. 68 document, the Company issued 135 million domestically listed foreign investment shares (B shares) to overseas investors at the price of HKD 3.54 (equivalent to 3.8 yuan) with the par value of each share being 1 yuan during June to July 1996. 4. Pursuant to the reply of the Ministry of Foreign Trade and Economic Cooperation of the People’ s Republic of China with (1996) WJMZYHZ No. 606 document, the Company was approved to be a foreign-invested joint stock company limited. 5.The Company distributed dividends and capitalized capital common reserve for the year 1996 in the following manner: The Company paid 1.7 bonus shares f or each 10 shares and capitalized capital common reserve on 3.3-for-10 basis. 6. Pursuant to the approval of China Securities Regulatory Committee (CSRC) with ZJFZ (1997) No. 486 and No. 487 document, the Company issued 100 million public shares (A shares) at the price of RMB 5.41 in term of “payable in full on application, pro-rate placing and subject to refund” with the par value of each share being RMB 1 in January 1998. 7.In accordance with the Resolutions of the 1999 Shareholders’ General Meeting of the Company and pursuant to the approval of Guangzhou Securities Regulatory Office under CSRC with GZZJH (2000) No. 99 and that of CSRC with ZJGSZ (2000) No. 98, the Company offered 3 Rights for every 10 shares of 764.256249 million shares at the price of RMB 11 per Right.73,822,250 ordinary shares were actually placed to all . 8. Pursuant to the reply of the General Office of the People’ s Government of Guangdong Province with YBH (2000) No. 574 document, the state-owned shares were transferred to Guangdong Communication Group Co., Ltd. (Group Co.) for holding and management without compensation. 66 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 9.Pursuant to the approval of Shenzhen Stock Exchange, 53.0205 million staff shares of the Company (132,722 shares held by directors, supervisors and senior executives are temporarily frozen) were listed on February 5, 2001. 10.In accordance with the resolutions of 2000 annual shareholders’ general meeting, the Company capitalized capital common reserve into 419,039,249 shares on 5-for-10 basis with the total share capital as of the end of 2000, i.e., 838,078,499 shares as base. The date of stock right registration was May 21, 2001. The ex-right date was May 22, 2001. 11 . On March 8, 2004,As approved by China Securities Regulatory Commission by document Zheng-Jian-Gong-Si-Zi [2003]No.3, the 45,000,000 non-negotiable foreign shares were placed in Shenzhen Stock 12. On December 21, 2005, the Company's plan for share holding structure reform was voted through at the shareholders' meeting concerning A shares. On January 26 2006, The Ministry of Commerce of PRC issued “The approval on share converting of Guangdong Provincial Expressway Development Co., Ltd.” to approve the share equity relocation and transformation. On October 9 2006, according to the “Circular about implementing of share equity relocation and relative trading” issued by Shenzhen Stock Exchange, the abbreviation ID of the Company’ s A shares was restored from “G-Expressway” “Expressway A”. 13. Upon the approval document of CSRC No.230-2016 Zheng Jian Xu ke-Approval of the Share-Issuing to Parties such as Guangdong Provincial Expressway Co., Ltd to Purchase Assets and Raise Matching Funds by Guangdong Provincial Expressway Development Co., Ltd, in June 2016 the company issued 33,355,263 shares and paid RMB 803.50 million to Guangdong Provincial Expressway Co., Ltd for purchasing the 25% stake of Guangdong Provincial Fokai Expressway Co., Ltd held by Guangdong Provincial Expressway Co., Ltd; and issued 466,325,020 shares to Guangdong Provincial Highway Construction Co., Ltd for purchasing the 100% stake of Guangzhou Guangzhu Traffic Investment Management Co., Ltd held by Guangdong Provincial Highway Construction Co., Ltd. On June 21, 2016, the company directionally issued 334,008,095 A-shares to Yadong Fuxing Yalian Investment Co.,Ltd, Tibet Yinyue Investment Management Co.,Ltd and GF Securities Co.,Ltd. The issuance of shares have been registered on July 7, 2016, the new shares will be listed on July 8, 2016. (2)Organization structure and the actual controller of the Company As of June 30, 2018,Registration capital:RMB2,090,806,126,Legal representative:Zheng Renfa,Registration place:No.85, Baiyun Road, Guangzhou, Headquarters Office: 45-46/F, Litong Plaza, No.32, Zhujiang East Road, Zhujiang New City, Tihe Disrtict , Guangzhou,The company has set up: Investment Development Dept, Security Affairs Department, Management Department, Financial Management Department, Base construction Department, 67 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Audit and Supervise Department, Affairs Department, Personnel Department , Party Work Department, Law affairs Department , Project Office and Labour union etc. Guangdong Communication Group Co., Ltd. is the largest shareholder of the Company. legal representative: Deng Xiaohua. Date of establishment: June 23, 2000. As of June 30, 2018,Registered capital: RMB 26.8 billion. It is a solely state-owned limited company. Business scope:equity management, organization of asset reorganization and optimized allocation, raising funds by means including mortgage, transfer of property rights and joint stock system transformation, project investment, operation and management, traffic infrastructure construction, highway and railway project operation and relevant industries, technological development, application, consultation and services, highway and railway passenger and cargo transport, ship industry, relevant overseas businesses; The value-added communication business. (3)The company’s main business and share ,Holding company The company operated the construction of the highway construction, grading roads, bridges;Management fees and maintenance of roads, bridges, and car rescue, maintenance, cleaning, concurrently with the company's business s upporting motor transport, warehousing operations. The Company is mainly engaged in tolling and maintenance of Guangfo Expressway, Fokai Expressway, investm ent in technological industries and provision of relevant consultation while investing in Shenzhen Huiyan Express way Co., Ltd., Guangzhou Guanghui Expressway Co., Ltd.,Jingzhu Expressway Guangzhu Co., Ltd.,Guangdong J iangzhong Expressway Co., Ltd., Zhaoqing Yuezhao Expressway Co., Ltd.,Ganzhou Kangda Expressway , Ganzh ou Gankang Expressway Co., Ltd.,Guangdong Yueke Technology Micro Loan Co., Ltd.,Guangdong Guangle Expressway Co.,Ltd. and Guoyuan Securities Co., Ltd. (4)Scope of consolidated financial statements The company's 2018(Jan-June) annual consolidated subsidiaries of total 6 companies, The scope of consolidated financial statements is consistent with the previous period. Refer to Notes X(8), Notes of financial statements ,Change of consolidation scope and NotesX(9), Notes of financial statements, Equity in other entities for more details. (5)Approval of the financial statements reported The financial statements have been authorized for issuance by the Board of Directors of the Group on August 27,2018. IV. Basis for the preparation of financial statements 1.Preparation basis The company prepares the financial statements on the basis of a continuous operation, the actual transactions, “Accounting Standards for Enterprises – Basic Standards”, other accounting standards & related regulations. Furthermore, all the materials of financial statements of the company meet the relevant disclosure requirements of financial statements and notes on the “Editing and Reporting Rules Regarding Information Disclosure for Companies Publicly Issuing Securities No. 15 – General Regulations for Financial Reporting (revised in 2014) by China Securities Regulatory Commission. 2.Continuation There will be no such events or situations in the 12 months from the end of the reporting period that will cause 68 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 material doubts as to the continuation capability of the Company. V. Significant Accounting Policies and Accounting Estimates Specific accounting policies and accounting estimates are indicated as follows: Nil 1. Statement of Compliance with the Accounting Standards for Business Enterprises The financial statements prepared by the Company comply with the requirements of corporate accounting standards. They truly and completely reflect the financial situations, operating results, equity changes and cash flow, and other relevant information of the company. 2.Fiscal Year The Company adopts the Gregorian calendar year commencing on January 1 and ending on December 31 as the fiscal year. 3.Operating cycle An operating cycle for the Company is 12 months, which is also the classification criteria for the liquidity of its assets and liabilities. 4.Standard currency for bookkeeping The Company takes RMB as the standard currency for bookkeeping. 5.Accountings for Business Combinations under the Same Control & Business Combinations not under the Same Control 1.Business Combinations under the Same Control The assets and liabilities acquired by the company in the business combination shall be measured as per the obtained book value of owner’s equity of the combined party in the consolidated financial statements. As for the balance between the carrying amount of the net assets obtained by the combining party & the carrying amount of the consideration paid by it (or the total par value of the shares issued), the additional paid-in capital shall be adjusted. If the additional paid-in capital is not sufficient to be offset, the retained earnings shall be adjusted. The direct costs for the business combination of the company, including the expenses for audit, assessment and legal services, shall be recorded into the profits & losses at the current period. The handling fees, commissions & other expenses for the issuance of equity securities for the business combination shall be credited against the surplus of equity securities; if the surplus is not sufficient, the retained earnings shall be offset. Where the accounting policies adopted by the combined parties are different from those adopted by the company, the company shall adjust them on the combining date according to the accounting policy it adopts, and shall, pursuant to the Accounting Standards for Enterprises, recognize them on the basis of such adjustments. 2. Business Combinations not under the Same Control 69 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 The assets paid as the consideration for the business combination & the liabilities assumed on the acquisition date shall be measured in accordance with the fair value. The difference between the fair value & its carrying amount shall be recorded into the profits & losses at the current period. The company will distribute the combination costs on the acquisition date. The company shall recognize the positive balance between the combination costs & the fair value of the identifiable net assets it obtains from the acquire as Goodwill while it shall record the negative balance between the combination costs & the fair value of the identifiable net assets it obtains from the acquire into the profits & losses of the current period. As for the assets other than intangible assets acquired from the acquire in a business combination (not limited to the assets which have been recognized by the acquire), if the economic benefits brought by them are likely to flow into the enterprise and their fair values can be measured reliably, they shall be separately recognized and measured in light of their fair values. As for any intangible asset acquired in a combination, if its fair value can be measured reliably, it shall be separately recognized as an intangible asset and shall measured in light of its fair value. As for the liabilities other than contingent liabilities acquired from the acquire, if the performances of the relevant obligations are likely to result in any out-flow of economic benefits from the enterprise, and their fair values can be measured reliably, they shall be separately recognized and measured in light of their fair values. As for the contingent liabilities of the acquire obtained in a combination, if their fair values can be measured reliably, they shall be separately recognized as liabilities and shall be measured in light of their fair values. 6.Methods for Preparing the Consolidated Financial Statements The scope of the consolidated financial statements will be recognized on the basis of controlling. All the subsidiaries will be included into the consolidated financial statements. The accounting policies & accounting periods adopted by all the subsidiaries that have been included into the scope of the consolidated financial statements should be consistent with those adopted by the company. If the accounting policies & accounting periods adopted by the subsidiaries are different from those adopted by the company, the company shall make necessary adjustments according to the accounting policies & accounting periods it adopts when preparing the consolidated financial statements. After adjusting the long-term equity investments on its subsidiaries according to the equity method, the company shall prepare the consolidated financial statements based on the financial statements of the company & its subsidiaries, and other related documents. The influences of the internal transactions between the company & its subsidiaries, and its subsidiaries themselves on the consolidated balance sheet, consolidated profit statement, consolidated cash flow statement & consolidated statement of changes in owner’s equity will be counteracted at the preparation of the consolidated financial statements. The portion of a subsidiary’s equity that is not attributable to the parent is treated as minority shareholders’ interest and presented as “minority interest” in the consolidated balance sheet within owners’ equity. The 70 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 portion of net profits or losses of subsidiaries for the period attributable to minority interest is presented in the consolidated income statement below the “net profit” line item as “minority interest”. In the consolidated financial statements, when the amount of loss for the period attributable to the minority shareholders of a subsidiary exceeds the minority shareholders’portion of the opening balance of owners’equity of the subsidiary, the excess amount should be still allocated against minority interest. In the report period, If the subsidiary is added through the business combination under the same control, the beginning balance of the consolidated balance sheet shall be adjusted. The incomes, expenses & profits of the subsidiary incurred from the beginning of the current period to the end of the reporting period shall be included into the consolidated profit statement. The cash flow from the beginning of the current period to the end of the reporting period shall be included into the consolidated cash flow statement. For purchase of minority interests held by the minority shareholders of a subsidiary, when preparing the consolidated financial statements, the difference between the long-term equity investment newly gained by buying minority interests and the portion of net assets consistently calculated from the acquisition date (or the consolidation date) pursuant to newly added shareholding percentage entitled by the subsidiary should be adjusted to the owners’ equity (the capital reserve). If the capital reserve is not sufficient to absorb the difference, any excess is adjusted against retained earnings. In the report period, If the company disposes its subsidiary, the incomes, expenses & profits incurred from the beginning of the subsidiary to the disposal date shall be included into the consolidated profit statement. The cash flow from the beginning of the subsidiary to the disposal date shall be included into the consolidated cash flow statement. 7.Joint venture arrangements classification and Co-operation accounting treatment ⑴A joint arrangement refers to an arrangement jointly controlled by two participants or above.,the joint venture arrangements include co-operation and joint ventures. (2)When the joint venture company for joint operations, confirm the following items and share common business interests related to: (1)Confirm individual assets and common assets held based on shareholdings; (2)Confirm individual liabilities and shared liabilities held based on shareholdings; (3)Confirm the income from the sales revenue of co-operate business output (4)Confirm the income from the sales of the co-operate business output based on shareholdings; (5)Confirm the individual expenditure and co-operate business cost based on shareholdings. ⑶ When a company is a joint ventures, joint venture investment will be recognized as long-term equity investments and long-term equity investments are accounted for in accordance with the method of the Notes to Financial State ments. 8.Recognition Standard of Cash & Cash Equivalents The company recognizes its cash in vault & the deposits that are ready for payment at any time as cash when preparing the cash flow statement.which are featured with short term (expire within 3 months since purchased), high liquidity, easy to convert to know cash, low in risk of value change, could be recognized as cash equivalents. Equity investment are not recognized as cash equivalents. 71 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 9.Foreign Currency Transaction (1)Foreign Currency Transaction For the company with non-functional currency business, the middle rate of the market exchange rate published by People’s Bank of China on the date of occurrence of business are recorded as the functional currency, and the balances of foreign currency shall be adjusted by the end of the month according to the middle rate of the market exchange rate published by People’s Bank of China at the end of period. The differences between the recording currency amount converted by the exchange rate at the end of period and the carrying currency amount are as “Finance Costs – Exchange Gains and Losses” and recorded into the current profits or losses. The exchange gains and losses related to borrowings on the fixed assets shall be made treatment according to the principles of borrowing costs capitalization. (2)Conversion of Foreign Financial statement If overseas subsidiaries, cooperative enterprises, joint ventures, branches of the company adopt the different functional recording currency and record the overseas business of the company into the financial statements through the consolidated statements and the accounting by the equity method, the overseas financial statements shall be translated as the recording functional currency. Before the translation, the company shall adjust the accounting period and policy of overseas business in order to make the consistent adjustment, and translate the overseas financial statements according to the financial statements of the preparation of corresponding currency after the accounting policy and period adjusted and as per the following methods: ① For the assets and liabilities in the balance sheet, the shot exchange rate on the balance sheet date is adopted as the translation exchange rate. For the owner’s equity, the shot exchange rate on the transaction date is adopted as the translation exchange rate, with the exception of “undistributed profits”. ② The incomes and expenses in the income statement shall be translated at the spot exchange rate or the approximate exchange rate on the transaction date. ③ The translation gap of financial statement of foreign currency shall be listed under the owner’s equity in the consolidated balance sheet in the preparation of the consolidated financial statements. 10.Financial tools 1. Categories of financial Tools The Company divides the financial assets into four categories: financial assets measured at fair value and their variations are recognized as current gain/loss, including trade financial assets or financial liabilities and recognized directly as financial assets measured at fair value and their variations are recognized as current gain/loss; Investment hold till expiration; loans and account receivable; saleable financial assets .The company divides the financial liabilities into two categories: financial liabilities measured at fair value and their variations are recognized as current gain/loss; other financial liabilities. 2. Recognition and measurement of financial tools (1) Financial assets and liabilities measured at fair value and their variations are recognized as current gain/loss The fair value (after deducting of announced but not distributed cash dividend or due but not obtained bond interests) is recognized as initial amount when obtained. Interests or cash dividends during the period of holding are recognized as investment gains. The fair value will be 72 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 adjusted and accounted as current gain/loss. When disposed, the differences between fair value and initial amount are recognized as investment gains, and thus adjust the gain/loss of fair value. 2. Recognition and measurement of financial tools (1) Financial assets and liabilities measured at fair value and their variations are recognized as current gain/loss The fair value (after deducting of announced but not distributed cash dividend or due but not obtained bond interests) is recognized as initial amount when obtained. Interests or cash dividends during the period of holding are recognized as investment gains. The fair value will be adjusted and accounted as current gain/loss. When disposed, the differences between fair value and initial amount are recognized as investment gains, and thus adjust the gain/loss of fair value. (2) Investment hold till expiration The fair value (after deducting of due but not obtained bond interests) plus the related trade expenses is recognized as initial amount when obtained. Interest gains will be calculated at amortizing of costs and actual interest rate (the face rate is adopted when the difference between the actual rate and face rate is minor) during the period of holding, and accounted as investment gains. Actual rate is recognized when obtained, and is not changed in the predictable holding period or applicable shorter period. When disposed, the difference between the obtained price and book value is accounted as investment gains. If the company sells or reclassifies large-amount due investments before the expired date (large amount refers to comparing with the amount before the selling or reclassifying the investments), the company will reclassify the rest of the investments as financial assets for sale, and in the current accounting period or within two complete accounting years, no financial assets will be classified as holding due assets, except for the following situations: the sale date or reclassification date is close to the expired date of the investment (such as three months before the expired), and the change of interest rate has no significant influence on the fair value of the investment; after all the initial principal is mostly recovered according to periodic payments or repay in advance regulated in the contract, the rest part will be sold or reclassified; the sale and reclassification is caused by the independent events which are uncontrollable and unexpected and will not happen any more. (3) Account receivable The receivable debts of selling goods or providing services, and the credits of other company hold by the company not including the debt which has price in active market, including accounts receivable, notes receivable, prepaid accounts, other receivables, long-term receivables, etc. The contract or agreement price charging from purchaser should be taken as the initial confirmation amount; if it has the nature of financing, it should be confirmed according its current value. When retrieved or disposed of, the difference between the actual received amount and the book value is accounted as current gain/loss. (4) Saleable financial assets The fair value (after deducting of announced but not distributed cash dividend or due but not obtained bond 73 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 interests) plus the related trade expenses is recognized as initial amount when obtained. Interest or cash dividend occurred during the period of holding is recognized as investment gains. Change of fair value is accounted as capital reserves (other capital reserves) at the end of term. When disposed, the difference between the obtained price and book value is accounted as investment gains. Meanwhile, the corresponding part of accumulated change of fair value accounted as owners’ equity is transferred into investment gain/loss. (5) Other financial liabilities Other financial liabilities are recognized initially at the sum of fair value and related trade expenses. Successive measurement will be on the basis of amortized costs. 3. Recognition and measurement basis of financial asset transposition When financial asset transposition occurred, the recognition of this particular financial asset is terminated if almost all risks and rewards attached to the asset have been transferred to the acceptor. If retain all the risks and rewards of ownership of financial assets, the financial assets can be confirmed. When determine whether the transfer of financial assets meet the conditions of confirmation of the above financial assets, the principle of substance being more important than form should be adopted. The transfer of financial assets can be divided into overall transfer and part transfer of financial assets. If the transfer of financial assets meet the conditions of terminating confirmation, the following the difference of the two amounts will be included in the current profit and loss: (1) Book value of the financial asset to be transposed; (2) The sum of price received due to the transposition, and the accumulation of change in fair value originally accounted as owners’ equity (when the asset to be transposed is saleable financial asset). If part transfer of financial assets meet the conditions of terminating confirmation, the book value of the transferred financial assts, the difference between the confirmed part and the unconfirmed part (in this case, the service assets retained should be deemed as the part of unconfirmed financial assets), should be amortized in accordance with their relative fair value, and the difference between the following two amount should be included current profit and loss: ① Book value of the confirmed part; ②All fair values of financial assets and financial liabilities are recognized with reference to the price in the active market. If the transfer of financial assets does not meet the conditions of terminating confirmation, the financial assets should be confirmed again, the prices received will recognized as financial liabilities. 4.The conditions to stopping the financial liabilities The obligation of financial liabilities are already cancelled which should be stopped confirming the financial liability or the part of it. Our company could stop confirming the currently financial liability and begin to confirm the newly financial liability if the loaner made an agreement that they would assume the new way of financial liability which replace the current one, and make sure the newly financial liability is totally different from the old one in contract with our company. Stop admitting the financial liability or a part of it, and at mean time we could admit the newly financial liability 74 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 which is in new insertions of contract as the newly financial liability if the current financial liability has been revised. Stop admitting the balance of value of financial liability and consideration (Including the roll-out of non-cash assets or financial liabilities) which could be consider as current profits and losses. Stop and continue admitting a part of value, and distribute the value of financial liability, if our company repurchased the part of financial liability. And the balance of value of which distributed to the part of stopping admitting and paid (Including the roll-out of non-cash assets or financial liabilities) which could be consider as current profits and losses. 5.Recognition basis of financial assets and financial liabilities All fair values of financial assets and financial liabilities are recognized with reference to the price in the active market(Using valuation technique, etc). 6. Impairment provision for financial assets ①Impairment provision for financial assets for sale: If the fair value of financial assets for sale greatly drops at the end of the period, or after considering all the relevant factors and expecting decrease trend is non-temporary, the impairment should be confirmed, and the accumulative loss formed by the decrease of fair value of owner’ equity originally included should be transferred out altogether and confirmed as impairment loss. ②Holding the impairment provision of expired investments: The measurement of holding the impairment provision of expired investment will be according to the method of the measurement of impairment provision for receivables. 11.Accounts Receivable (1)Accounts receivable with material specific amount and specific provisioned bad debt preparation. The accounts receivable whose single amount is over RMB 1 Judgment criteria or amount standard of material specific amount million & accounts for over 10% of the accounts receivable or amount criterial: amount. Conduct the devalue test separately. Set up the bad debt reserve Provision method with material specific amount and provision of according to the shortfall of the present value of expected future specific bad debt preparation: cash flows against its carrying amount and record it into the profits & losses at the current period. (2)The accounts receivable of bad debt provisions made by credit risk Group The basis for determining the combination of Credit risk:The accounts receivable whose single amount is over RMB 1 million & accounts for over 10% of the accounts receivable amount. Conduct the devalue test separately. Set up the bad debt reserve according to the shortfall of the present value of expected future cash flows against its carrying amount and record it into the profits & losses at the current period. In the Groups, adopting aging analysis method to withdraw bad debt provision 75 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 √ Applicable □ Not applicable Aging Rate for receivables(%) Rate for other receivables(%) Within 1 year(Included 1 year) 0.00% 0.00% 1-2 years 10.00% 10.00% 2-3 years 30.00% 30.00% 3-4 years 50.00% 50.00% 4-5 years 90.00% 90.00% Over 5 years 100.00% 100.00% Accounts on percentage basis in group: □ applicable √not applicable Accounts on other basis in group: √ Applicable □ Not applicable Separately carry out the impairment test, prepare the bad debt according to the expected future cash flow present value below the balance of its book value, and take account of the current profit and loss. (3)Account receivable with non-material specific amount but specific bad debt preparation The accounts receivable under 5 years of age which are not Reason of individually withdrawing bad debt provision significant without any business connections any more. Conduct the devalue test separately. Set up the bad debt reserve according to the shortfall of the present value of expected Witharawal method for boad debt provision future cash flows against its carrying amount and record it into the profits & losses at the current period. 12.Inventory Whether the Company needs to comply with the disclosure requirements for specific industrie No 1.Investories class: The company’s stocks can be classified as: raw materials, inventory goods, low-value consumables & other materials, etc. 2. Valuation method of inventory issued :The company calculates the prices of its inventories according to the weighted averages method or the first-in first-out method. 3. Recognition Basis of Inventories’ Net Realizable Values and Counting & Drawing Method of Obsolete Inventory Reserves:After taking stock at the end of the period, 4. Inventory System:Adopts the Perpetual Inventory System 13. Divided as assets held for sale In the presence of the following conditions are satisfied when non-current assets or a part of the company is classi fied as held for sale: (1) The components should be immediately sold under the current condition only according to the usual terms of 76 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 the parts sold. (2) The sale is highly probable, that is, the company has already made a resolution on a sale plan and obtained a certain purchase commitment, which is expected to be completed within one year. Where the relevant regulations require the approval of the relevant authority of the company or the regulatory authority before it can be sold, the approval has been gained. The determined purchase commitment refers to the legally binding purchase agreement signed between the company and other parties. The agreement includes important terms such as transaction price, time and sufficiently severe penaltybreach of penalty, making the agreement unlikely to be significantly adjusted or cancelled. 14. Long-term equity investment (1) The Classification of Long-term Equity Investments The long-term equity investments of the company should include the investments in the subsidiaries and the investments in cooperative enterprises and joint ventures. (2) The Recognition of Investment Cost ① For the business combination under common control and the combining party paying in cash, transferring non-monetary assets, bearing debts or issuing the equity securities as the consideration, the initial investment cost shall be recognized according to the shares of the book value in the consolidated financial statement of the ultimate controlling party that acquired by the combined party on the combination date. The capital reserves shall be adjusted for the difference between the initial investment cost of long-term equity investment and the book value of the paid cash, the transferred non-monetary assets and the borne debts. The retained earnings shall be adjusted if the capital reserves are insufficient to offset. For the long-term equity investment after the business combination under common control realized step-by-step through multiple transactions, the shares of the book value of the owner’ equity of the combined party shall be as the initial investment cost in the individual financial statements and the consolidated financial statements as per the shareholding proportion. The capital reserves shall be adjusted for the balance between the sums of the book value of the equity investment of the combined party held on the combination date and the new investment cost increased on the combination date minus the initial investment cost of long-term equity investment. The retained earnings shall be adjusted if the capital reserves are insufficient to offset. ②For the business combination under non-common control, the initial investment cost shall be recognized according to the fair value of the merger consideration paid on the purchase date. For the long-term equity investment after the business combination under non-common control realized step-by-step through multiple transactions, the relevant accounting treatment should be respectively conducted for the individual financial statement and the consolidated financial statements: 1) In the individual financial statements, the sum of the book value of equity investment from the purchased party held before the purchase date and the new investment cost at the purchase date shall be as the initial investment cost of the investment. Other comprehensive incomes related to the equity of the purchased party held before the purchase date shall be transferred into the current investment incomes in the disposal of the investment. 2) In the consolidated financial statements, the equity of the purchased party held before the purchase date should be measured again according to the fair value of the equity on the purchase date, and the gap of the fair value and the book value should be recorded into the current investment incomes. Other comprehensive incomes related to the equity of the purchased party held before the purchase date shall be transferred into the current investment incomes on the purchase date. ③With the exception of the business combination: 77 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 The long-term equity investment acquired by the payment in cash should be as the investment cost as per the actual purchase payment. The investment costs include fees, taxes and other necessary expenses directly related to the achieved long-term equity investment. The long-term equity investment acquired by the issuance of equity securities should be as the investment cost as per the fair value of the issued equity securities. The long-term equity investment acquired by the non-monetary assets exchange (the exchange with the commercial substance) should be as the investment cost as per the fair value of the investment and the payable taxes. For the long-term equity investment acquired by the debt reorganization, the creditors shall recognize the fair value of the enjoyed shares as the investment of the debtors. (3) Subsequent Measurement and Recognition Method of Profit and Loss The cost method shall be adopted to account the long-term equity investment controlled by the invested party and the equity method shall be adopted to account the long-term equity investment with joint control or significant influence. (4) Recognition Criteria for the Invested Party with Joint Control or Significant Influence The joint control on the economic activity appointed as per the contract shall exist when the major finance and the operating decision related to the economic activity are agreed by the invested party sharing the control right, which shall be regarded as the joint control on the invested party implemented by other parties. The decision power to participate in the finance and operating decision on the enterprise, but without control or joint control with other parties to formulate these policies, shall be regarded as the significant influence on the invested party implemented by the investment enterprise. (5) Impairment Test Method and Withdrawing Method For the impairment test method and the withdrawing method of the long-term equity investment, please refer to “Long-term Assets Impairment in Article 10 of Important Accounting Policies and Accounting Estimates 21 in Notes 5 of Financial Statements”. 15. Entrusted Loans The entrusted loans shall be made bookkeeping according to the actually entrusted loan amount. The receivable interests shall be withdrawn according to the interest rate stated in the entrusted loans. For the impairment test method and the impairment provision withdrawing method of the entrusted loans, please refer to “Long-term Assets Impairment in Article 10 of Important Accounting Policies and Accounting Estimates 21 in Notes 5 of Financial Statements”. 16..Investment Real Estates The measurement mode of investment property The measurement by the cost method Depreciation or amortization method The term “Investment real estates” refers to the real estates held for generating rentand/orcapital appreciation, including the right to use any land which has already been rented, the right to use any land which is held and prepared for transfer after appreciation & the right to use any building which has already been rented. 78 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 The company shall make a measurement to the investment real estate through the cost pattern.The company shall adopt the same depreciation policy as its fixed assets for the investment real estates measured by the cost pattern-buildings for renting & the same amortization policy as its intangible assets for the right to use any land for renting. For the impairment test method and the impairment provision withdrawing method of the .Investment Real Estates, please refer to “Long-term Assets Impairment in Article 10 of Important Accounting Policies and Accounting Estimates 21 in Notes 5 of Financial Statements”. 17.Fixed assets (1)Confirmation conditions of fixed assets Fixed assets refer to physical assets owned for purpose of production, service providing, leasing or management, and operation with service life of more than one year. Fixed assets are recognized when all of the following conditions are satisfied:Financial benefits attached to the fixed asset is possibly inflowing to the Company;(2) The cost of the fixed asset can be reliable measured. (2)Depreciation method Evpected useful Annual depreciation Type Depreciation methnod Residual rate(%) life(Year) rate(%) Guangfo Expressway Working flow basis 28 years 0 Fokai Expressway-Xiebian to Working flow basis 40 years 0 Sanbao Section Fokai Expressway-Sanbao to Working flow basis 30 years 0 Shuikou Section Jingzhu Expressway Working flow basis 30 years 0 Guangzhu Section House Building The straight-line method 20-30 years 3%-10% 3%-4.85% Machine Equipment The straight-line method 10 years 3%-10% 9%-9.7% Transportation The straight-line method 5-8 years 3%-10% 11.25%-19.4% Equipment Electric Equipment and The straight-line method 5-15 years 3%-10% 6 %-19.4% other Provision for depreciation of highways and bridges is made with work amount method. Estimatednet residual value rate is zero. Estimated useful life is determined according to the period of peration right in respect of charge collection. The concrete calculation method is as follows: The amount of provision for depreciation per standard vehicle traffic volume is to be calculated based on the estimated total standard vehicle traffic volume within expected useful life of highways and bridges and the original value or book value of highways and Bridges. Then provision for depreciation is made according to the actual standard vehicle traffic volume in each 79 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 fiscal period. The company regularly rechecks the estimate total standard vehicle traffc volume withintheremaining operation period of highways and bridges. When there is big difference between actual standard vehicle traffic volume and estimated standard vehicle traffic volume, the Company will re-estimate future total standard vehicle traffic volume and adjust the provision for depreciation per standard vehicle traffic volume to ensure that the book value of relevant highways and bridges will be completely amortized within useful life. The company adopts the straight line method for the depreciation of fixed assets excepthighways & bridges, and recognizes the depreciation rate according to the fixed asset group, expected useful life & the expected net salvage value rate. (3) Test Method for Fixed Asset Impairment and Counting & Drawing Method for Fixed Asset Impairment Reserves For the impairment test method and the impairment provision withdrawing method of the Fixed assets, please refer to “Long-term Assets Impairment in Article 10 of Important Accounting Policies and Accounting Estimates 21 in Notes 5 of Financial Statements”。 18.Construction-in process 1. Calculation of Construction-in-process:The constructions in process are classified & accounted according to the established projects. 2. Standard & Time Point for Carrying Constructions in Process Forward to Fixed Assets All the expenditures that bring the construction in process to the expected condition for use shall be the credit value of the fixed asset. If the fixed asset construction in process has already reached the expected condition for use, but hasn’t been made the final account; it shall be carried forward to a fixed asset according to its estimated value based on the budget, cost or actual cost of the construction starting from the date when it reaches the expected condition for use, and the fixed asset shall be depreciated according to the company’s depreciation policy for fixed assets. After the final account has been made, the original provisional estimated value shall be adjusted according to the actual cost, but the depreciation which has originally been counted & drawn shall not be adjusted. 3.Test Method for Construction-in-Process Impairment and Counting & Drawing Method For the impairment test method and the impairment provision withdrawing method of the Construction-in process , please refer to “Long-term Assets Impairment in Article 10 of Important Accounting Policies and Accounting Estimates 21 in Notes 5 of Financial Statements”。 19.Loan expenses 1. Recognition principles for capitalizing of loan expenses Borrowing expenses occurred to the Company that can be accounted as purchasing or production of asset satisfying the conditions of capitalizing, are capitalized and accounted as cost of related asset. Other borrowing expenses are recognized as expenses according to the occurred amount, and accounted into gain/loss of current term. The assets meeting capital conditions refer to the fixed assets, investment real estates and inventories which are constructed or produced in a long time to reach the predicted use or sale state. When a loan expense satisfies all of the following conditions, it is capitalized: 80 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 1. Expenditures on assets have taken place, asset expenditures include the assets used to construct or produce the assets which meet the capitalization conditions, and expend by cash or transferring non-cash assets or bearing interest debt; 2. Loan costs have taken place; 3. The construction or production activities to make assets to reach the intended use or sale of state have begun. 2. Duration of capitalization of Loan costs The capitalization period refers to the period from starting capitalization of loan costs to the stop of capitalization, the period of the break of capitalization of Loan costs is not included. When the construction or production meets the intended use or sale of state of capitalization conditions, the Loan costs should stop capitalization. When the construction or production meets the conditions of capitalization and can be used individually, the capitalization of the loan costs of the assets should be stopped. Where each part of a asset under acquisition and construction or production is completed separately and is ready for use or sale during the continuing construction of other parts, but it can not be used or sold until the asset is entirely completed, the capitalization of the borrowing costs shall be ceased when the asset is completed entirely. 3.Capitalization Suspension Period Where the acquisition and construction or production of a qualified asset is interrupted abnormally and the interruption period lasts for more than 3 months, the capitalization of the borrowing costs shall be suspended. If the interruption is a necessary step for making the qualified asset under acquisition and construction or production ready for the intended use or sale, the capitalization of the borrowing costs shall continue. The borrowing costs incurred during such period shall be recorded into the profits & losses at the current period, till the acquisition and construction or production of the asset restarts. 4. Calculation of the amount of capitalization of Loan costs Interest expense due to specialized Loan and its auxiliary expenses shall be capitalized before the asset which satisfies the capitalizing conditions reaches its useable or saleable status. Interest amount of common Loan to be capitalized equals to accumulated asset expense less weighted average of specialized loan part of asset expense multiplies capitalizing rate of common Loan occupied. Capitalizing rate is determined according to weighted average interest of common Loan. If the Loan has discount or premium, the discount or premium amount should be determined according to actual interests in each accounting period. The interest amount should be adjusted in each period. 20.Intangible assets (1) Pricing method, useful life and impairment test 1. The valuation methods of intangible assets (1)The initial measurement is conducted according to the actual cost when the intangible assets are acquired The cost of the purchased intangible assets includes its buying price, relevant tax and the othe expenses that are directly attributed to this assets meeting its predetermined objective and other expenses that occur. The buying price of intangible assets is over the deferred payment under normal credit conditions, which has the nature of financing materially, the cost of intangible assets is determined on the basis of the present value of its buying price. We acquire the mortgaged intangible assets from debtors through debt restructuring and determine the entry value on the basis of the fair value of the intangible assets,we have the balance between the book value of debt restructuring and the fair value of intangible assets used for mortgage charged to the current profit and loss. 81 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 The entry value of the non-monetary assets exchanged into by the non-monetary assets are determined on the basis of the fair value of the assets exchanged out if the exchange of non-monetary assets has commercial nature and the assets exchanged into or out can be reliably measured, unless there is authentic evidence indicating that the fair value of assets exchanged into are more reliable; if the non-monetary assets that cannot meet the above prerequisite use the book value of the assets exchanged out and relevant taxes payable as the cost of the non-monetary assets, the profit and loss is not confirmed. The entry value of the intangible assets acquired by the absorption merger under the control of one company is determined by the book value of the merged party;the entry value of the intangible assets acquired by the absorption merger that is not under the control of one company is determined by the fair value. The cost of the intangible assets developed internally includes the materials consumed in developing the assets, cost of service, registration fees, other patent used in developing, amortization of concession and interest charges meeting the capitalization conditions and othe direct costs that occur before the intangible assets meeting the predetermined objective. (2)Subsequent measurement The Company analyses and makes judgment of its serviceable life when acquiring the intangible assets. The intangible assets that have limited serviceable life are amortized by the straight-line method during the period when the assets can bring about economic interests;The intangible assets are deemed as uncertain serviceable life and are not amortized if it is impossible to expect the period when the assets could bring about economic interests. At the end of period, the Group shall check the service life and amortization method of intangible assets with finite service life, if there is any change, it shall be regarded as a change of the accounting estimates. Besides, the Group shall check the service life of intangible assets without certain service life, if there is any evidence showing that the period of intangible assets to bring the economic benefits to the enterprise can be prospected, it shall be estimated the service life and amortized in accordance with the amortization policies for intangible assets with finite service life. (2) Provision for the depreciation of value of the intangible assets For the impairment test method and the impairment provision withdrawing method of the Intangible assets, please refer to “Long-term Assets Impairment of Important Accounting Policies and Accounting Estimates in Notes 5 of Financial Statements”. 21.Impairment of Long-term assets (1) Scope The assets Impairment main includes long-term equity investment, investment property (the investment property measured by the fair value excluded), fixed assets, projects under construction, engineering material, intangible assets (the capitalized development expenditure included), asset group, combination of asset group, business reputation, etc.. (2) Recognition of Possible Impairment Assets The company makes judgment of the assets if there exists the possible impairment at the balance sheet date. The intangible assets with indefinite goodwill and service life due to the combination of enterprise, shall be conducted the impairment test every year regardless of the impairment. The impairment may occurs for the assets if there is the following status: ① The market price of assets fall sharply in the current period, and the decline is obviously beyond that estimated due to the passage of time or normal use. ② The significant changes in the economy, technology or legal environment operated by the company and the 82 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 assets market in the current or the near future adversely affect the company. ③ The improvement of the market interest rates or other market investment returns in the current period, influence the company to calculate assets estimating the discount rate of the present value of future cash flow and result in the sharp drop of the recoverable amount of the assets. ④ There is evidence that shows the assets have become obsolete or the entities have been damaged. ⑤ The assets have been or will be idle, terminated the use or planned to dispose in advance. ⑥ The evidence in the internal report of the company shows that the economic performance of assets has been less than or lower than the expected, such as the net cash flow created by assets or the achieved operating profit (or loss) is far below (or above) the estimated amount. ⑦ Other evidences indicate the impairment of assets may have occurred. (3) Measurement of the Recoverable Amount of the Assets The recoverable amount shall be estimated if there exists the impairment for the assets. The recoverable amount should be recognized according to the higher one between the net amount of the fair value minus the disposal costs and the present value of the cash flow of assets expected in the future. (4) Determination of Asset Impairment Loss The measurement results of the recoverable amount show that the book value of assets shall be reduced to the recoverable amount and the reduced amount shall be recognized as the impairment loss of assets and recorded into the current profits and losses, and the impairment provisions of the relevant assets are withdrawn if the recoverable amount of the assets is less than the book value. After the recognition of the assets impairment loss, the depreciation or amortization costs of the impairment assets should be made adjustment accordingly in the future period in order to make the assets to systematically amortize the book value of the assets after adjusted within the remaining service life (the estimated residual value deducted). The impairment loss of assets after recognized shouldn’t be reversed in the future accounting period. (5) Recognition and Impairment Treatment of Assets Group If there is the impairment for one asset, the company shall estimate the recoverable amount based on the individual asset. If it is difficult for the company to estimate the recoverable amount of the individual asset, the recoverable amount of asset group shall be recognized on the basis of the asset group which the asset is belong to. The recognition of the asset group should be made on the basis of the main cash inflow generated by the assets group that if is independent to the cash inflow of other assets or assets group. The corresponding impairment loss shall be recognized if the recoverable amount of the assets group or the assets group combination is less the book value (the book value of the assets group or the assets group combination should include the amortization quota relevant to corporate assets and goodwill for the assets group or the assets group combination amortized by the corporate assets and the goodwill). The book value of goodwill in the amortized assets group or assets group combination shall be firstly offset for the impairment losses, and the book value of other assets shall be offset in proportion according to the proportion of the book value of other assets in the assets group or the assets group combination, with the exception of the goodwill. (6) The Goodwill Impairment The company has conducted the impairment test at least every year for the goodwill established by the business combination. The book value of the goodwill generated by the combination shall be amortized into the related asset group from the purchase date. If difficult to amortize into the relevant asset group, the book value shall be amortized into the relevant asset group combination. The relevant asset group or asset group combination refers to that benefitting from the synergistic effect of the business combination and is not more than the report portion recognized by the company. 83 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 When the relevant asset group or the asset group combination including the goodwill are conducted the impairment test, the impairment test should be firstly conducted for the asset group without the goodwill or the asset group combination, the recoverable amount shall be calculated and the corresponding impairment loss shall be recognized by comparison with the relevant book value if there exists the impairment for the asset group relevant to the goodwill or the asset group combination. Then the impairment test should be conducted for the asset group with the goodwill or the asset group combination, the impairment loss of the goodwill shall be recognized and made the treatment according to the provisions of the asset group impairment stated in the notes if the recoverable amount of the relevant asset group or the asset group combination is less than the book value by comparison of the book value of these relevant asset group or the asset group combination (including the book value of the goodwill amortized) with the recoverable amount. 22.Long-term amortizable expenses Long-term prepaid expenses refer to that enterprises have already spent, and amortization periods of all expenses are more than one year (excluding 1 year), they should be amortized in the regulated years. 23.Remuneration (1)Accounting treatment of short-term remuneration Remuneration refers to all kinds of rewards or compensation that the Company gives to get in return for the services its employees provide or employment termination. It includes short-term compensation, post-employment benefits, demission benefits and other long-term employee benefits. Enterprises to provide employees spouse, child welfare, dependents, survivors and other beneficiaries of deceased employees, etc., also belong to payroll. During the company's accounting staff to provide services, the actual wages, bonuses, allowances and subsidies, w elfare, medical insurance, work injury insurance and maternity insurance and other social insurance, housing fund confirmed, labor union funds, employee education funds and as a liability profit or loss or costs related assets. If t he debt is expected to provide services after the end of the annual reporting period in which an employee can not b e fully paid within twelve months, and the financial impact is material, the amount will be discounted liabilities m easured after. (2) Accounting methods for post-employment benefits Post-employment benefits refer to the compensation and benefits that the Company gives to get in return for employees’ services for their retirement or employment termination, excluding short-term compensation and demission benefits. It falls into two categories, defined contribution plans and defined benefit plans. ① The defined contribution plan: the company shall no longer bear the further obligation to pay severance benefit plans after the company deposits the fixed costs to the independent funds. The basic pension insurance and the unemployment insurance shall be recognized as the liability according to the payable amount accounted by the defined contribution plans and recorded onto the current profits and losses or the relevant asset costs during the accounting period of the services provided by the staffs. ② The defined benefit plan: the severance benefit plans with the exception of the defined contribution plans. (3) Accounting Treatment Method of Demission Welfare The Company offers compensation to terminate employment with its employees before it expires or encourage them to accept lay-off. Such compensation is demission benefits and counted in current profit and loss. The employee compensation liabilities generated by the demission welfare shall be recognized on the early date and recorded into the current profits and losses: (1) when the company can’ withdraw the demission welfare provided 84 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 due to the rundown suggestion or the termination of labor relations plans. (2) when the enterprise recognizes the costs or the expenses related to the reorganization of demission welfare payment. The economic compensation before the official retirement date shall be belong to the demission welfare when the implementation of the internal retirement plan for workers. During the period from the termination of service date to the normal retirement date, the paid internal retirement payroll and social insurance charges shall be once recorded into the current profits and losses. The economic compensation after the official retirement date (such as the normal retirement pension) should be handled according to the welfares after the demission. 24.Estimated liabilities The company should recognize the related obligation as a provision for liability when the obligation meets the following conditions: (1) That obligation is a present obligation of the enterprise; (2) It is probable that an outflow of economic benefits from the enterprise will be required to settle the obligation; (3) A reliable estimate can be made of the amount of the obligation.On the balance sheet date, an enterprise shall take into full consideration of the risks, uncertainty, time value of money, and other factors pertinent to the Contingencies to measure the estimated liabilities in accordance with the best estimate of the necessary expenses for the performance of the current obligation. When all or some of the expenses necessary for the liquidation of an estimated liabilities of an enterprise is expected to be compensated by a third party, the compensation should be separately recognized as an asset only when it is virtually certain that the reimbursement will be obtained. Besides, the amount recognized for the reimbursement should not exceed the book value of the estimated liabilities 25.Bond payable When the company is issuing bonds, the total price issued should be included in the “Payable bonds” subject. The difference between bond issuance total amount and the total amount of bond face valueshould be worked as bond premium or discount and be amortized within the bond period according to actual interest rate and vertical line method, and be treated according to borrowing costs described below. 26.Other Comprehensive Incomes Other comprehensive incomes refer to the profits and losses unrecognized in the current profits and losses according to other provisions of accounting standards. There are two reports: (1) Other comprehensive incomes that unable to be reclassified into the profits and losses in the future accounting period, mainly including the changes caused by the net liabilities and the net assets of the defined benefit plan that re-measured and the shares of other comprehensive incomes that accounted and unable to be reclassified into the profits and losses for the invested party in the future accounting period according to the equity method. (2) Other comprehensive incomes that reclassified into the profits and losses in the future accounting period when the requirements are met, the shares of other comprehensive incomes that accounted and reclassified into the profits and losses for the invested party in the future accounting period according to the equity method when the requirements are met, the profits or losses caused by the fair value changes of the sellable financial assets, the profits or losses generated by the sellable financial assets reclassified for the held-to-maturity investment, the effective hedging portion of the profits and losses issued by the cash flow hedging instruments, and the translation 85 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 differences of foreign financial statements. 27. Revenues Whether the Company needs to comply with the disclosure requirements for specific industrie No The company’s incomes mainly include the toll service revenues and the services provision. (1) The recognition principle of the toll service revenues is that the toll revenues refer to the charges of operating the toll roads and shall be recognized in the actual charge. (2) The recognition principle of the services provision is as follows: The labor services started and completed within the same fiscal year shall be recognized as the revenues when the labor services finished. If the labor services started and completed in the different fiscal year and under the reliable estimation of the provided services transaction results, the company shall recognize the relevant service incomes according to the completion percentage method at the balance sheet date. The results of the transaction can be estimated reliably when the following requirements are all met: (1) total revenues and total labor costs can be measured reliably. (2) the economic benefits relevant to the transaction will flow into the enterprise. (3) the competition degree of the labor services can be reliably determined. 28. Government Grants (1)Government Grants Government grants means that the Company obtains monetary or non monetary assets free of charge from the government, excluding the capital invested by the government as an owner. The company recognizes the government grants when the company can meet the conditions of government grants and be able to receive the government grants. Thereinto: (1) If the government grant is a monetary asset, it shall be measured according to the amount received or receivable; If the government grant is a non-monetary asset, it shall be measured at fair value, and if the fair value cannot be obtained reliably, it shall be measured according to the nominal amount. ⑵The government grants pertinent to assets are used to write down the carrying value of the underlying assets or are recognized as deferred income. If the government grants pertinent to assets are recognized as deferred gains, it shall be included in the profits and losses in a reasonable and systematic manner within the useful life of the underlying asset. The Government grants, measured in nominal amounts, are directly included in current profits and losses. The government grants pertinent to income that are used to compensate the relevant costs or losses of the subsequent period of the enterprise are recognized as deferred income and are credited to the current profit or loss or are written down to offset the costs for the period when the relevant expenses are recognized; those government grants used for compensating the related expenses or losses incurred shall be directly included in the current profits and losses. ⑶ Government grants related to the daily activities of the enterprise are included in other income or are written down to offset costs in accordance with the economic business nature. Government grants that are not related to the day-to-day activities of the enterprise are included in non-operating income and expenditure. Where the recognized government grant needs to be refunded, then the accounting treatment shall be carried 86 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 out in the period that it needs to be refunded according to the following stipulations: (1) Where it was written down the book value of the underlying assets at the time of initial recognition, then the book value of the assets shall be adjusted; (2) Where there is a related deferred income, it shall write-down the book balance of related deferred income and the excess part shall be included in the current profit and loss; (3) Where belongs to other cases, that shall be directly included in the current profits and losses. 29.Deferred income tax assets and deferred income tax liabilities The company is likely to determine the deferred income tax assets produced from deductible temporary differences with the limit of offsetting the taxable income of temporary difference. The Company confirms the temporary differences of the taxable that is not paid in the current and prior periods as the deferred income tax liabilities. However, the goodwill, the transactions formed from non-business merger and those will affect either accounting profit or the temporary differences of the taxable income when the transactions occur are not included in the deferred income tax liabilities. 30.Accounting Methods of Income tax The company’s income tax is accounted in Balance sheet liability approach. The company recognizes the sum of current income tax and deferred tax as the income tax expenses(or income) in the income statement on the basis of calculating and determining the income tax of the current period(namely the current taxes payable) and the deferred tax (the deferred tax expenses or income ), but excluding the effects of the business combination and the income taxes related to the transactions or events directly recorded in the owner’s rights and interests. 31.Change of main accounting policies and estimations ⑴Change of accounting policies □ Applicable √Not applicable ⑵Change of accounting estimations □ Applicable √ Not applicable VI. Taxation 1. Major category of taxes and tax rates Tax category Tax basis Tax rate Sales by sale of goods or provision of VAT 3%、5%、6%、10%、11%、16%、17% taxable services City maintenance and construction tax The actual payment of turnover tax 7%、5% Enterprise income tax Taxable income 25% .Education surcharges The actual payment of turnover tax 3% 87 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Local Education surcharges The actual payment of turnover tax 2% 2.Preferential tax Nil VII. Notes to the major items of consolidated financial statement 1.Monetary Capital In RMB Items Amount in year-end Amount in year-begin Cash 82,371.11 66,065.04 Bank deposit 1,820,722,446.96 2,362,279,050.70 Other 661,321.30 697,584.68 Total 1,821,466,139.37 2,363,042,700.42 2. Account receivable 1.Classification account receivables. In RMB Amount in year-end Amount in year- begin Book Balance Bad debt provision Book Balance Bad debt provision Category Book valu Book valu Amount Proporti Amount Proportion Amount Proporti Amount Proportion on(%) (%) on(%) (%) Account receivable with single major amount 65,760,470 and 43,102,039.46 45.54% 43,102,039.46 65,760,470.23 70.64% .23 withdrawal bad debt provision for single item Account receivable 26,882,155 51,551,743.98 54.46% 542,607.74 1.05% 51,009,136.24 27,331,295.37 29.36% 449,140.15 1.64% .22 withdrawalba d debt 88 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 provision by group of credit risk characterstics 92,642,625 Total 94,653,783.44 100.00% 542,607.74 0.57% 94,111,175.70 93,091,765.60 100.00% 449,140.15 0.48% .45 Receivable accounts with large amount individually and bad debt provisions were provided √ Applicable □Not applicable In RMB Receivable accounts Amount in year-end (Unit) Receivable accounts Bad debt provision Proportion Reason Guangdong Union Been recovered after the Electronic Services Co., 43,102,039.46 period Ltd. Total 43,102,039.46 -- -- Account receivable on which bad debt provisions are provided on age basis in the group: √ Applicable □Not applicable In RMB Balance in year-end Aging Receivable accounts Bad debt provision Withdrawal proportion Subitem within 1 year Subtotal within 1 year 48,765,342.11 0.00% 1-2 years 1,646,564.11 164,656.41 10.00% 2-3 years 1,079,837.76 323,951.33 30.00% 3-4 years 50.00% 4-5 years 60,000.00 54,000.00 90.00% Total 51,551,743.98 542,607.74 1.05% Notes of the basis of recognizing the group: In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision: □ Applicable √ Not applicable In the groups, accounts receivable adopting other methods to accrue bad debt provision:: Nil (2)Accrual period, recovery or reversal of bad debts situation The current amount of provision for bad debts is RMB1.00 ; recovery or payback for bad debts Amount is 89 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 RMB0.00. (3)The current accounts receivable write-offs situation Nil (4)The ending balance of other receivables owed by the imputation of the top five parties Name Amount Aging Proportion(%) Bad debt provision Guangdong Union Electronic Services Co., Ltd. 43,102,039.46 Within 1 year 45.54 Guangdong Humen Bridge Co., Ltd. 27,048,223.47 Within 1 year 28.58 Guangdong Jingzhu Expressway Guangzhu 4,447,474.99 Within 1 year 4.70 North Section Co., Ltd. Shandong Boan Intelligent Technology Co., Ltd. 3,393,474.35 Within 1 year 3.59 Guangdong Qinglian Highway Development 3,130,000.00 Within 1 year 3.31 Co., Ltd. Total 81,121,212.27 -- 85.72 (5)Account receivable which terminate the recognition owning to the transfer of the financial assets Nil (6)The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts receivable Nil 3. Prepayments (1)Age analysis In RMB Balance in year-end Balance in year-begin Age Amount Proportion(%) Amount Proportion(%) Within 1 year 1,527,512.44 88.09% 4,238,442.26 95.21% 1-2 years 1,762.53 0.10% 8,721.49 0.20% 2-3 years 35,000.00 0.79% Over 3 years 204,738.00 11.81% 169,738.00 3.80% Total 1,734,012.97 -- 4,451,901.75 -- 90 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Notes of the reasons of the prepayment ages over 1 year with significant amount but failed settled in time: Nil (2) Top 5 of the closing balance of the prepayment colleted according to the prepayment target Name Amount Time Proportion(%) Guangzhou Tuzhiling Computer Technology Co., 624,469.35 Within 1 year 36.01 Ltd. China pacific property insurance co., Ltd. 594,467.44 Within 1 year 34.28 Guangzhou Maritime Court 169,738.00 Over 5 years 9.79 Guangzhou Haohang Electronic Technology Co., 110,990.40 Within 1 year 6.40 Ltd. Shenzhen Gonglian Construction Engineering 62,575.50 Within 1 year 3.61 Co., Ltd. Total 1,562,240.69 -- 90.09 4.Dividend receivable (1)Dividend receivable In RMB Items Balance in year-end Balance in year-begin China Everbright Bank Co., Ltd. 42,581,144.86 Guoyuan Securities Co., Ltd. 11,940,297.90 Total 54,521,442.76 (2)Significant dividend receivable aged over 1 year Nil 5.Other accounts receivable (1) Other accounts receivable disclosed by category In RMB Balance in year-end Balance in year-begin Category Book Balance Bad debt provision Book Balance Bad debt provision Amount Proportio Amount Proportio Book value Amount Proporti Amount Proportion Book value n(%) n(%) on(%) (%) 53,351,56 Other Account 29.94% 53,351,565.01 100.00% 53,351,565.01 75.72% 53,351,565.01 100.00% 5.01 91 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 receivable with single major amount and withdrawal bad debt provision for single item Other Account receivable withdrawal bad 124,819,7 15,415,512 debt provision by 70.06% 1,543,724.65 1.24% 123,275,981.57 17,110,594.66 24.28% 1,695,082.59 9.91% 06.22 .07 group of credit risk characteristics Other Account receivable with minor individual 178,171,2 15,415,512 100.00% 54,895,289.66 30.81% 123,275,981.57 70,462,159.67 100.00% 55,046,647.60 78.12% amount but bad 71.23 .07 debt provision is provided Total 92 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 - Other receivable accounts with large amount and were provided had debt provisions individually at end of period. √ Applicable □Not applicable In RMB Balance in year-end Other receivable(Unit) Other receivable Bad debt provision Proportion Reason The parent company once paid 33,683,774.79 yuan into Kunlun Securities Co., Ltd, Guangdong Expressway technology investment Co., Ltd once paid 18,000,000.00 yuan into Kunlun Securities Co., Ltd. Qinghai Province Xining City’s intermediate people’s court made a adjudication under law declared that Kunlun Securities Co., Ltd went bankrupt and repaid debt in November 11, 2006. On March 2007, The Kunlun Securities Company and Guangdong Expressway Technology Investment Co., Ltd had switched 49,343,885.10 49,343,885.10 100.00% Co.,Ltd. the money that paid into Kunlun Securities Co., Ltd to other account receivable, and follow the careful principle to doubtful debts provision. The RMB 710,349.92 Credit was Recovered in 2008, and the provision for bad debt is deducted, The 977,527.77 yuan credit was recovered in 2011, and the provision for had debt is deducted. The 652,012.00 yuan Credit was recovered in 2014, and the provision for had debt is deducted. Guangdong Expressway Technology investment Co., Ltd .should charge Beijing Gelin Enze Organic Fertilizer Co., Ltd.for 12,220,079.91 yuan. Eight millions of it was entrust loan, three million was temporary borrowing 12,400.00 yuan is the commission loan interest, the rest of it was advance money for another, Beijing Gelin Enze Organic Fertilizer Co., Ltd’s operating status was had and had already ceased 4,007,679.91 4,007,679.91 100.00% producing, Accordingly, the controlling subsidiary of the company Guangdong Expressway Investment Co., Ltd. accounted full provision for Bad debt Beijing Gelin Enze 12,220,079.91 yuan provision. Organic Fertilizer Co., The company in 2014 recovered arrears of 8,000,000.00 Ltd. yuan, rushed back to the provision for bad debts and write off uncollected interest ent 93 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Balance in year-end Other receivable(Unit) Other receivable Bad debt provision Proportion Reason rusted loans according to tThe settlement agreement of 212,400.00 yuan. Total 53,351,565.01 53,351,565.01 -- -- 94 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Other receivable accounts in Group on which bad debt provisions were provided on age analyze basis: √ Applicable □Not applicable In RMB Amount in year-end Age Other receivable Bad debt provision Withdrawal proportion Subitem Withn 1 year Subtotal within 1 year 117,023,751.56 1-2 years 10.00% 2-3 years 32,457.98 9,737.39 30.00% 3-4 years 50.00% 4-5 years 90.00% Over 5 years 1,533,987.26 1,533,987.26 100.00% Total 118,590,196.80 1,543,724.65 1.30% Notes of the basis of recognizing the group: In the groups, other accounts receivable adopting balance percentage method to withdraw bad debt provision □ Applicable √Not applicable In the groups, other accounts receivable adopting other methods to accrue bad debt provision: √ Applicable □Not applicable Amount in year-end Name Other account Bad debt Withdrawal Reason receivable provision proportion(%) Guangdong Litong Real estate Investment Co., 1,505,864.00 Deposit Ltd Guangdong Guanghui Expressway Co., Ltd 1,413,708.90 Deposit Guangdong Expressway Co., Ltd. 575,630.98 Administration expenses,Quality guarantees fund Zhaoqing Yuezhao Highway Co., Ltd. 415,614.00 Deposit Guangdong Xinyue Traffic Investment Co.,Ltd. 415,442.60 Quality guarantees Beijing Shibang Weilishi Property Management 393,331.00 Deposit Services Co., Ltd. Guangdong Guangzhu West Line Expressway 185,366.60 Quality guarantees Co., Ltd. Guangshen Zhu Expressway Co., Ltd. 185,014.40 Quality guarantees 95 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in year-end Name Other account Bad debt Withdrawal Reason receivable provision proportion(%) CRCC Harbour & Channel Engineering Bureau 165,169.25 Quality guarantees Group Co., Ltd. Beijing Gongke Feida Transport Engineering 115,475.20 Quality guarantees Development Co., Ltd. Guangdong Feida Transportation Engineering 90,920.75 Quality guarantees Development Co., Ltd. Guangdong Highway Construction Co., Ltd. 76,563.00 Quality guarantees Chengdu Shuguang Fibre-optical Metwork Co., 59,758.09 Quality guarantees ltd. Guangdong Jingzhu Expressway Guangzhu 55,694.00 Quality guarantees North Section Co., Ltd. Guangdong Boda Expressway Co., Ltd. 51,808.80 Quality guarantees Shenzhen Expressway Engineering consulting 50,000.00 Bid security Co.,ltd. Guangdong West Coastal Expressway Zhuhai 40,967.05 Quality guarantees Section Co., Ltd. Guangzhou Chengcheng Auto Leasing Service 30,000.00 Deposit Co., ltd. Guangdong Jiangzhong Expressway Co., Ltd. 28,120.00 Quality guarantees Pengjiang Shunfeng Auto Leasing Service 25,500.00 Deposit Center Guangzhou Tuzhiling Computer Technology 25,438.80 Quality guarantees Co., Ltd. Guangdong Road & Bridge Construction 24,972.70 Quality guarantees Development Co., Ltd. Guangzhou Express Transportation 22,094.40 Quality guarantees Construction Co., Ltd. Guangzhou Longfeng Auto Leasing Co., Ltd. 20,000.00 Deposit Guangzhou Beihuan Expressway Co., Ltd. 16,590.40 Quality guarantees Guangzhou Huanan Road & Bridge Co., Ltd. 16,000.00 Quality guarantees Guangzhou Saitisi Electromechanical 15,875.00 Quality guarantees Installation Engineering Co., Ltd. Shanxi Hantang Computer Co., Ltd. 14,250.00 Quality guarantees Guangdong Shenshanxi Expressway Co., Ltd. 13,246.40 Quality guarantees Guangzhou Daguang Expressway Co., Ltd. 12,749.60 Quality guarantees Guangdong Shenshan Expressway East Section 12,000.00 Quality guarantees Co., Ltd. 96 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in year-end Name Other account Bad debt Withdrawal Reason receivable provision proportion(%) Guangdong Humen Bridge Co., Ltd. 11,107.50 Quality guarantees Guangzhou Dingrong Information Technology 10,950.00 Quality guarantees Co., Ltd. Guangzhou Suihua Expressway Co., Ltd. 10,400.00 Quality guarantees Zhongshan Global Environmental Engineering 10,000.00 Deposit Co., Ltd. Guangdong Gaoda Property Development 9,940.70 Deposit Co.,ltd. Guangdong Zhonglin Electrical Installation 8,820.00 Quality guarantees Engineering Co., Ltd. Guangdong Maozhan Expressway Co., Ltd. 8,747.20 Quality guarantees Guangdong Shanfen Expressway Co., Ltd. 8,028.80 Quality guarantees Guangdong Baomao Expressway Co., Ltd. 7,633.60 Quality guarantees Guangdong Yuedong Expressway Industry 7,367.20 Quality guarantees Development Co., Ltd. Guangdong Guangle Expressway Co., Ltd. 7,248.00 Quality guarantees Foshan Guangsan Expressway Co., Ltd. 6,492.00 Quality guarantees Guangdong Yangmao Expressway Co., Ltd. 6,004.80 Quality guarantees Guangdong West Coastal Expressway Xinhui 5,753.20 Quality guarantees Section Co., Ltd. Huishen(Yantian)Expressway Huizhou Co., 5,600.00 Quality guarantees Ltd. Guangzhou Expressway Co., Ltd. 5,528.80 Quality guarantees Guangdong Litong Technology Investment Co., 5,273.00 Quality guarantees Ltd. Guangdong Maoming Nanda Electric Power 5,000.00 Quality guarantees Construction Co., ltd. Huizhou Branch Guangdong Zhaoyang Expressway Co., Ltd. 4,304.00 Quality guarantees Guangdong Yueyun Traffic Co., Ltd. 3,032.00 Quality guarantees Jiangmen Jianghe Expressway Co., Ltd. 2,539.20 Quality guarantees Guangzhou Guangcong Expressway Co., Ltd. 2,027.20 Quality guarantees Foshan Nanhai Jiasheng Drinking Water Chain 1,800.00 Deposit Shanxi Sihe Traffic Engineering Co., Ltd. 1,600.00 Quality guarantees Beijing Zhonghe Tianxia Management 1,000.00 Guarantees Consultation Co., Ltd. Guangdong Weishi Highway Engineering Co., 146.30 Quality guarantees 97 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount in year-end Name Other account Bad debt Withdrawal Reason receivable provision proportion(%) Ltd. Total 6,229,509.42 - Other receivable accounts withno large amount and were provided had debt provisions individually at end of period.:Nil (2)Accrual period, recovery or reversal of bad debts situation The current amount of provision for bad debts is RMB 0.00 ; recovery or payback for bad debts Amount is 151,357.94 yuan. Where the current bad debts back or recover significant amounts:Nil (3)The actual write-off other accounts receivable Nil (4) Other accounts receivable classified by the nature of accounts In RMB Nature Closing book balance Opening book balance Securities trading settlement funds balance 49,343,885.10 49,343,885.10 Guarantee deposit 5,946,185.54 Disposit 5,973,582.34 Current account of gelin enze 4,007,679.91 4,007,679.91 Pretty cash 3,540,100.00 3,950,100.00 Advertising and service fee 1,045,029.88 2,187,578.36 Assets Disposit 106,000,000.00 Other 8,288,390.80 4,999,333.96 Total 178,171,271.23 70,462,159.67 (5) Top 5 of the closing balance of the other accounts receivable colleted according to the arrears party In RMB 98 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Proportion of the total year end Closing balance of Name Nature Closing balance Aging balance of the bad debt provision accounts receivable(%) Zhuhai (National) High-tech Industrial Development Zone Management Assets Disposit 106,000,000.00 Within 1 year 59.49% Committee Planning and Construction Environmental Protection Bureau Kunlun Securities Securities trading set 49,343,885.10 Over 5 years 27.69% 49,343,885.10 Co.,Ltd tlement funds Beijing Gelin Enze Current account 4,007,679.91 Over 5 years 2.25% 4,007,679.91 Guangdong Litong 1-2 years, Over 5 Real estate Guarantees fund 1,505,864.00 0.85% years Investment Co., ltd. Heshan Communication Real Current account 1,470,000.00 Over 5 year 0.83% 1,470,000.00 estate Development Company Total -- 162,327,429.01 -- 91.11% 54,821,565.01 Notes:Zhuhai (National) High-tech Industrial Development Zone Management Committee Planning and Construction Environmental Protection Bureau of 106 million yuan assets disposal amount was recovered on July 3, 2018. Relevant matters have been announced by the company on July 4, 2018. (6) Accounts receivable involved with government subsidies Nil (7) Other account receivable which terminate the recognition owning to the transfer of the financial assets Nil (8) The amount of the assets and liabilities formed by the transfer and the continues involvement of other accounts receivable Nil 99 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 6.Inventory (1)Inventory types In RMB Year-end balance Year-beginning balance Items Provision for bad Provision for bad Book Balance Book value Book Balance Book value debts debts Raw material 139,076.49 139,076.49 Total 139,076.49 139,076.49 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 falling price reserves Nil (3) Description of The closing balance of inventories contain the amount of borrowing costs capita lized (4) Completed unsettled assets formed from the construction contact at the period-end Nil 7.Non-current asset due within 1 year In RMB Items Year-end balance Year-beginning balance Advance business tax 51,745.32 55,669.14 Total 51,745.32 55,669.14 Other notes 8.Other current assets In RMB Items Year-end balance Year-beginning balance Input tax to be deducted 921,856.82 76,576.08 Total 921,856.82 76,576.08 Other notes 100 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 9. Available-for-sale financial assets (1) List of available-for-sale financial assets In RMB Amount in year-end Amount in year- begin Items Bad debt Bad debt Book balance Book value Book balance Book value provision provision Available-for-sale equity 1,696,401,396.77 36,793,200.00 1,659,608,196.77 1,788,150,824.93 36,793,200.00 1,751,357,624.93 Instruments Measured by fair value 861,033,095.04 861,033,095.04 952,782,523.20 952,782,523.20 Measured by cost 835,368,301.73 36,793,200.00 798,575,101.73 835,368,301.73 36,793,200.00 798,575,101.73 Total 1,696,401,396.77 36,793,200.00 1,659,608,196.77 1,788,150,824.93 36,793,200.00 1,751,357,624.93 (2) Available-for-sale financial assets measured by fair value at the period-end In RMB Available-for-sale equity Available-for-sale Debt Type Total instruments instruments Cost of the equity instruments/amortized 517,560,876.80 517,560,876.80 cost of the liabilities instruments Fair value 861,033,095.04 861,033,095.04 Changed amount of the fair value accumulatively 343,472,218.24 343,472,218.24 included in other comprehensive income As at the end of the period, the company holds shares 235,254,944 shares of China Everbright Ban k According to the closing price of June 30, 2018 of 3.66 yuan, the final calculation of fair value was 861,033,095.04 yuan. (3) Available-for-sale financial assets measured by cost at the period-end In RMB Book balance Impairment provision Shareholdi Cash ng bonus of Investee Period-begin Increa Decrea Period-begin Increa Decr proportion the Period -end Period -end se se se ease among the reporting 101 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 investees period Guangdong Radio and Television Networks investment No.1 50,000,000.00 50,000,000.00 3.11% Limited partnership enterprise Kunlun Securities 30,000,000.00 30,000,000.00 30,000,000.00 30,000,000.00 5.74% Co., Ltd.(Notes1) Huaxia Securities 5,400,000.00 5,400,000.00 5,400,000.00 5,400,000.00 0.27% Co., Ltd. ( Notes 2) Huazheng Assets Management 1,620,000.00 1,620,000.00 1,393,200.00 1,393,200.00 0.54% Co. Ltd.(Notes3) Guangdong Guangle 748,348,301.73 748,348,301.73 9.00% Expressway Co., Ltd. Total 835,368,301.73 835,368,301.73 36,793,200.00 36,793,200.00 -- Notes 1.The owner's equity of Kunlun Securities Co., Ltd. was negative and it entered liquidation procedure in October 2005. A wholly owned subsidiary of Guangdong Expressway Technology Investment Co., Ltd. Will invest Kunlun Securities Co., Ltd.'s full provision for impairment of 30 million yuan. Notes 2: The owner's equity of Huaxia Securities Co., Ltd. was negative and it entered liquidation procedure in December 2005. The Company made full provision for impairment in respect of this long-term equity investment of RMB 5.4 million. Notes 3: According to De Wei Ping Gu Zi 2005 No. 88 Appraisal Report issued by Beijing Dewei Appraisal Co., Ltd. As the June 30, 2005, the amount of net assets of Huazheng Asset Management Co., Ltd. in book was 279.132 million yuan and the appraised value was - 2299.5486 million yuan ,On October 14, 2005, Jianyin CITIC Asset Management Co., Ltd. issued the Letter of Soliciting Opinions on Equity Assignment to the Company. Jianyin CITIC Asset Management Co., Ltd. was willing to pay the price of not more than RMB 42 million to acquire 100% equity of Huazheng Asset Management Co., Ltd. and solicited the Company's opinions. The Company replied on December 5, 2005, abandoning the preemptive right under the same conditions. The Company made provision of 1.3932 million yuan for impairment in respect of this long-term equity investm ent of 1.62 million yuan. (4) Changes of the impairment of the available-for-sale financial assets during the reporting period In RMB 102 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Available-for-sale Available-for-sale Type Total Equity instruments Debt instruments Balance of the withdrawn impairment at the 36,793,200.00 36,793,200.00 period-begin Balance of the withdrawn impairment at the 36,793,200.00 36,793,200.00 period-end ⑸Relevant description of the end of the fair value of the equity instruments at the end of a serious decline in fair value or non temporary decline but not related to impairment provision Nil 103 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 10. Long-term equity investment In RMB Increase/decrease Neg Investment Withdra Closing Additi Adjustment of Cash bonus or wal of balance of Opening ative profit and loss Closing Investees onal other Changes of profits impairm Othe impairme balance balance inve recognized nt comprehensiv other equity announced to ent r invest stme under the equity e income issue provisio provision ment nt method n I. Joint venture Guangdong 1,050,190,85 Guanghui 949,906,833.96 134,138,087.25 3,951,780.00 37,805,847.20 4.01 Expressway Co., Ltd. Zhaoqing Yuezhao 277,453,203. 291,906,117.18 28,635,945.38 43,088,859.48 08 Highway Co., Ltd. 1,241,812,951. 1,327,644,05 Subtotal 162,774,032.63 3,951,780.00 80,894,706.68 14 7.09 2. Affiliated Company Shenzhen 214,011,066. Huiyan 196,197,198.21 17,813,868.36 57 Expressway Guangdong Jiangzhong 176,610,703. 173,502,304.11 6,897,600.54 3,789,200.79 Expresswa 86 y Co.,. Ltd. Ganzhou 222,607,661. Kangda 208,768,922.86 13,838,738.80 66 Expressway Gan Ganzhou 207,454,916. 204,404,703.35 3,050,213.53 Gankang 88 Expressway 104 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Increase/decrease Neg Investment Withdra Closing Additi Adjustment of Cash bonus or wal of balance of Opening ative profit and loss Closing Investees onal other Changes of profits impairm Othe impairme balance balance inve recognized nt comprehensiv other equity announced to ent r invest stme under the equity e income issue provisio provision ment nt method n Guangdong Yueke 222,946,179. Technology 215,548,332.90 7,397,846.46 36 Petty Loan Co., Ltd. Guoyuan 795,116,263. Securities 807,040,587.43 5,004,857.02 -4,983,478.43 -5,404.45 11,940,297.90 67 Co., Ltd. 1,805,462,048. 1,838,746,79 Subtotal 54,003,124.71 -4,983,478.43 -5,404.45 15,729,498.69 86 2.00 3,047,275,000. 3,166,390,84 Total 216,777,157.34 -4,983,478.43 3,946,375.55 96,624,205.37 00 9.09 11. Investment property (1) Investment property adopted the cost measurement mode √ Applicable □Not applicable In RMB Items Houses and buildings Land use right Construction in progress Total I.Original value 1.Opening balance 12,664,698.25 12,664,698.25 2.Increased amount of the period (1)Outsourcing (2)Inventory, Fixed assets and Construction project into (3)Enterprise consolidation 105 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Houses and buildings Land use right Construction in progress Total 3.Decreased amount of the period (1)Disposal (2)Other Out 4.Closing balance 12,664,698.25 12,664,698.25 II.Accumulated depreciation accumulated amortization 1.Opening balance 9,908,940.57 9,908,940.57 2.Increased amount of 232,106.70 232,106.70 the period (1)Withdrawal or 232,106.70 232,106.70 amortization 3.Decreased amount of the period (1)Disposal (2)Other Out 4.Closing balance 10,141,047.27 10,141,047.27 III. Impairment provision 1.Opening balance 2.Increased amount of the period (1)Withdrawal 3.Decreased amount of the period (1)Disposal 106 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Houses and buildings Land use right Construction in progress Total (2)Other Out 4.Closing balance IV. Book value 1.Closing book value 2,523,650.98 2,523,650.98 2.Opening book 2,755,757.68 2,755,757.68 (2) Investment property adopted fair value measurement mode □Applicable√ Not applicable (3) Details of investment property failed to accomplish certification of property In RMB Items Book balue Reason Transportation and other ancillary Transportation and other ancillary facilities 1,661,619.56 facilities, Not accreditation 107 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 12. Fixed assets (1) List of fixed assets In RMB Guangfo Jingzhu Expressway House and Machinery Transportation Electricity equipment Items Fokai Expressway Total buildings equipment equipment Expressway Guangzhu section and other I. Original price 1.Opening balance 1,460,270,190.66 8,947,295,870.80 5,130,574,408.53 351,864,147.46 126,486,080.83 60,529,297.78 640,530,500.31 16,717,550,496.37 2.Increased amount of the period 442,475.45 735,013.97 1,177,489.42 (1)Purchase 442,475.45 735,013.97 1,177,489.42 (2)Transfer of project under construction (3)Increased of Enterprise consolidation 3.Decreased amount of the period 332,304,199.42 5,806,302.94 7,500.00 11,248,529.50 2,005,831.87 351,372,363.73 (1)Disposal or scrap 332,304,199.42 64,392.90 7,500.00 11,248,529.50 7,747,741.91 351,372,363.73 (2)Reclassification adjustment 5,741,910.04 -5,741,910.04 4.Closing balance 1,460,270,190.66 8,947,295,870.80 4,798,270,209.11 346,057,844.52 126,478,580.83 49,723,243.73 639,259,682.41 16,367,355,622.06 II. Accumulated depreciation 1.Opening balance 1,460,270,190.66 3,440,540,410.91 2,553,720,215.76 224,291,495.10 60,384,283.80 48,027,809.99 424,881,199.44 8,212,115,605.66 2.Increased amount of the period 248,113,498.44 119,192,484.76 7,015,995.01 5,610,652.80 1,364,344.73 17,456,629.29 398,753,605.03 (1)Withdrawal 248,113,498.44 119,192,484.76 7,015,995.01 5,610,652.80 1,364,344.73 17,456,629.29 398,753,605.03 108 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Guangfo Jingzhu Expressway House and Machinery Transportation Electricity equipment Items Fokai Expressway Total buildings equipment equipment Expressway Guangzhu section and other (2)Reclassification adjustmen 3.Decreased amount of the period 171,593,287.96 4,639,971.00 7,200.00 10,573,293.09 2,414,348.97 189,228,101.02 (1)Disposal or scrap 171,593,287.96 61,817.18 7,200.00 10,573,293.09 6,992,502.79 189,228,101.02 (2)Reclassification adjustmen 4,578,153.82 -4,578,153.82 4.Closing balance 1,460,270,190.66 3,688,653,909.35 2,501,319,412.56 226,667,519.11 65,987,736.60 38,818,861.63 439,923,479.76 8,421,641,109.67 II. Accumulated depreciation 1.Opening balance 2.Increased amount of the period (1)Withdrawal 3.Decreased amount of the period (1)Disposal or scrap 4.Closing balance III. Impairment provision 1.Opening balance 5,258,641,961.45 2,296,950,796.55 119,390,325.41 60,490,844.23 10,904,382.10 199,336,202.65 7,945,714,512.39 2.Increased amount ofthe period 5,506,755,459.89 2,576,854,192.77 127,572,652.36 66,101,797.03 12,501,487.79 215,649,300.87 8,505,434,890.71 (1)Withdrawal 3.Decreased amount of the period 109 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 ⑵Temporarily idle fixed assets Nil ⑶Fixed assets through financial leasing Nil ⑷Tenancy of fixed assets through operating lease Nil ⑸Details of fixed assets failed to accomplish certification of property In RMB Items Book value Reason Transportation and other ancillary House and buildings 89,074,691.12 facilities, Not accreditation Due to absorption, merger and House and buildings 722,312.46 reorganization, the formalities for change are in progress 110 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 13. Project under construction (1)Project under construction In RMB Year-end balance Year-beginning balance Items Book balance Provision for Book value Book balance Provision for Book value devaluation devaluation Sanbao To Shuikou 620,706,752.60 620,706,752.60 347,299,458.95 347,299,458.95 Expansion project Odd project 8,763,197.00 8,763,197.00 8,763,197.00 8,763,197.00 Total 629,469,949.60 629,469,949.60 356,062,655.95 356,062,655.95 (2) Changes of significant construction in progress In RMB Capita Includin liz g: Transferr Othe ation Capitaliz capitaliz Source Name of Opening ed to r Proporti Project of Budget Increase End balance ation of ation of of project balance fixed decr on % process interes interest interest funding assets ease t this rate period (%) Sanbao 3,426,206,660.00 347,299, 273,407, 620,706,752.60 29.19% 29.19% 20,665,801.20 14,731,029.23 4.57% Other 111 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 To 458.95 293.65 Shuikou Expansi on project Odd proj 8,763,19 8,763,197.00 Other ect 7.00 356,062, 273,407, Total 3,426,206,660.00 629,469,949.60 -- -- 20,665,801.20 14,731,029.23 -- 655.95 293.65 Notes : Sanbo to section expansion project has been included in the progress of the new Jiangluo line section of the total amount of river has been transferred to the fixed amount (3)Provision for impairment of construction projects in the current period Nil 112 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 14. Engineering material In RMB Items Balance in year-end Balance in year-begin Signpost 1,549,556.00 1,549,556.00 Total 1,549,556.00 1,549,556.00 15. Liquidation of fixed assets In RMB Items Balance in year-end Balance in year-begin Highway mechanical and electrical 99,127.90 equipment, etc. Total 99,127.90 16. Intangible assets (1) List of intangible assets In RMB Patent Non-patent Items Land use right Software Logo Total right right I. Original price 1.Opening balance 1,311,658.00 27,358,986.21 28,670,644.21 2.Increased amount of the -61,025.64 -61,025.64 period (1) Purchase -61,025.64 -61,025.64 (2)Internal Development (3)Increased of Enterprise Combination 3.Decreased amount of the period (1)Disposal 113 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Patent Non-patent Items Land use right Software Logo Total right right 4.Closing balance 1,311,658.00 27,297,960.57 28,609,618.57 II.Accumulated amortization 1.Opening balance 1,311,658.00 20,262,551.04 21,574,209.04 2.Increased amount of the 1,357,657.34 1,357,657.34 period (1) Withdrawal 1,357,657.34 1,357,657.34 (2)Increased of Enterprise Combination 3.Decreased amount of the period (1)Disposal 4.Closing balance 1,311,658.00 21,620,208.38 22,931,866.38 III. Impairment provision 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 5,677,752.19 5,677,752.19 2.Opening book value 7,096,435.17 7,096,435.17 At the end of the period, the proportion of intangible assets formed through internal R & D to the balance of intangible assets is 0.00%. ⑵Details of Land use right failed to accomplish certification of property 114 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Nil 17. Long-term amortize expenses In RMB Amortized expenses Balance in Increase in this Items year-begin period Other loss Balance in year-end Advertising column 92,768.83 55,661.40 37,107.43 property insurance Total 92,768.83 55,661.40 37,107.43 18. Deferred income tax assets/deferred income tax liabilities (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 Deductible loss 582,930,102.77 145,732,525.69 773,658,624.73 193,414,656.18 Amortization of 805,761.96 201,440.49 995,735.86 248,933.97 intangible assets Asset valuation 541,050,952.86 135,262,738.21 566,541,740.54 141,635,435.13 appreciation Total 1,124,786,817.59 281,196,704.39 1,341,196,101.13 335,299,025.28 (2) Deferred income tax liabilities 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 liabilities difference liabilities Changes in fair value of available for sale 343,472,218.24 85,868,054.56 435,221,646.40 108,805,411.60 financial assets Deductible temporary differences in the 527,408,001.10 131,852,000.28 607,306,748.61 151,826,687.15 formation of asset impairment Total 870,880,219.34 217,720,054.84 1,042,528,395.01 260,632,098.75 115 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (3)Details of unrecognized deferred tax assets In RMB Items Closing balance Opening balance Deductible temporary differences 92,231,097.40 92,288,987.75 Deductible losses 14,837,471.26 11,374,068.41 Total 107,068,568.66 103,663,056.16 (4)Deductible losses of the un-recognized deferred income tax asset will expire in the following years In RMB Year Balance in year-end Balance in year-begin Remark 2018 4,932,481.22 4,932,481.22 2019 3,456,570.30 3,456,570.30 2020 2021 2022 2,121,083.91 2,985,016.89 2023 4,327,335.83 Total 14,837,471.26 11,374,068.41 -- 19. Other Non-current assets In RMB Items Balance in year-end Balance in year-begin Prepaid fixed assets engineering fees 59,594,649.15 39,871,644.68 Advance software payment 268,155.00 268,155.00 Prepaid business tax 544,645.74 566,594.58 Prepaid land occupation tax 19,086,895.54 Total 79,494,345.43 40,706,394.26 20. Account payable (1)List of Account payable In RMB Items Balance in year-end Balance in year-begin Within 1 year(Including 1 year) 53,329,532.25 104,264,020.37 1-2 year (Including 2 years) 104,510,224.56 135,095,312.76 2-3 year(Including 3 years) 16,838,384.14 16,838,384.14 116 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Over 3 years 10,635,329.23 10,736,309.72 Total 185,313,470.18 266,934,026.99 (2) Notes of the accounts payable aging over one year In RMB Items Balance in year-end Unpaid reason Guangdong Highway Construction Co., 45,980,021.00 Unsettled Ltd. Heshan Land and resources Bureau 38,186,893.60 Unsettled Foshan Land and resources Bureau 30,507,598.21 Unsettled Guangdong Expressway Co., Ltd. 8,746,491.18 Unsettled Luochun Street Office(Finance Office) 1,043,431.50 Unsettled Total 124,464,435.49 -- 21. Advance from customers (1) List of advance from customers In RMB Items Balance in year-end Balance in year-begin Within 1 year(Including 1 year) 1,724,163.36 2,413,914.18 1-2 years(Including 2 years) 437,978.18 459,858.97 2-3 years(Including 3 years) Over 3 years 11,442,918.43 11,982,340.75 Total 13,605,059.97 14,856,113.90 (2) Significant advance from customers aging over one year In RMB Items Closing balance Unpaid/Uncarry over reason Guangzhou Huanlong Expressway Co., 10,074,746.54 Land rent is not in the settlement period Ltd. Guanghdong Xinle Technology 1,232,816.45 The Rental is not in the settlement period Development Co., Ltd. Total 11,307,562.99 -- ⑶The completion of the final construction contract has been completed and the project is not completed 117 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Nil 22. Payable Employee wage (1)Payable Employee wage In RMB Items Year-beginning balance Increase in the current Decrease in the current Year-end balance period period I. Short-term 11,334,182.16 127,056,420.60 123,595,606.21 14,794,996.55 compensation II.Post-employment bene fits - defined contribution 14,218,112.35 13,483,300.03 734,812.32 plans III. Dismiss welfare 142,050.00 142,050.00 Total 11,334,182.16 141,416,582.95 137,220,956.24 15,529,808.87 (2)Short-term Remuneration In RMB Items Year-beginning Increase in the current Decrease in the current Year-end balance balance period period 1.Wages, bonuses, allowances and 1,630,363.29 91,375,434.27 88,491,894.81 4,513,902.75 subsidies 2.Employee welfare 9,386,236.81 9,256,635.81 129,601.00 3. Social insurance premiums 7,252,203.86 7,246,122.84 6,081.02 Including :Medical insurance 5,897,263.37 5,891,862.77 5,400.60 Work injury insurance 258,307.04 258,192.24 114.80 Maternity insurance 676,615.89 676,050.27 565.62 Supplementary medical insurance 420,017.56 420,017.56 4.Public reserves for housing 14,168,087.52 14,154,984.52 13,103.00 5.Union funds and staff education 9,563,059.92 3,861,926.04 3,293,917.18 10,131,068.78 fee 8.Other 140,758.95 1,012,532.10 1,152,051.05 1,240.00 Total 11,334,182.16 127,056,420.60 123,595,606.21 14,794,996.55 (3)List of drawing scheme In RMB 118 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Balance in year-begin Increase in this period Payable in this period Balance in year-end 1. Basic old-age 10,680,495.65 10,672,329.73 8,165.92 insurance premiums 2.Unemployment 405,702.81 405,383.41 319.40 insurance 3.Enterprise annuity 3,131,913.89 2,405,586.89 726,327.00 payment Total 14,218,112.35 13,483,300.03 734,812.32 23. Tax Payable In RMB Items Balance in year-end Balance in year-begin VAT 9,747,931.67 14,248,594.77 110,623,870.14 404,574,001.58 Enterprise Income tax Individual Income tax 236,145.51 6,572,617.38 City Construction tax 598,694.45 1,022,178.29 Land use tax 567,264.70 1,050,431.75 Property tax 504,258.88 253,014.94 Education subjoin 285,127.99 466,899.60 Locality Education subjoin 176,052.44 297,234.60 Stamp tax 37,299.64 63,071.56 Other 56,085.36 99,349.82 Total 122,832,730.78 428,647,394.29 24.Interest payable In RMB Items Balance in year-end Balance in year-begin Pay the interest for long-term loans by 7,983,129.04 8,494,355.93 installments. Interest payable on entrusted loans 1,349,043.75 Total 9,332,172.79 8,494,355.93 - Particulars of significant overdue unpaid interest Nil 25. Dividends payable In RMB 119 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Year-end balance Year-Beginning balance Common stock dividends 18,193,409.32 14,340,792.20 Xinyue Highway Construction Co., Ltd. 25,000,000.00 12,500,000.00 Total 43,193,409.32 26,840,792.20 Note: Including significant unpaid dividends payable over one year, the unpaid reason shall be disclosed: Final dividend payable 14,338,121.94yuan for more than a year in unpaid dividends to shareholders over the year was mainly due to non-payment of shareholder dividends did not provide information on interest-bearing bank, di d not share reform of shareholders to receive dividends or provide application to receive dividends the bank infor mation is incorrect, resulting in failure to pay a dividend or refund. 26.Other accounts payable (1) Other accounts payable listed by nature of the account In RMB Items Year-end balance Year-Beginning balance Quality guarantee fund 60,947,872.26 36,254,269.95 Deposit 1,427,067.00 1,676,667.00 Borrowing 150,000,000.00 Other 43,223,935.39 48,732,300.99 Total 255,598,874.65 86,663,237.94 (2) Other significant accounts payable with aging over one year In RMB Items Closing balance Unpaid/un-carry over reason Project Quality guarantees/ Bid Guangdong Guanyue luqiao Co., Ltd. 2,075,848.02 Gruarantees/Deposit Guangdong Nengda Grade Highway 2,123,700.47 Project Quality guarantee Maintenance Co., Ltd. Guangdong Changda Engineering Co., Ltd 1,826,971.58 Project Quality guarantees Dongguan Yueyu Optoelectronic 1,534,850.00 Project Quality guarantees Technology Co., Ltd. Guangdong Xinyue Traffic Investment Project Quality guarantees/ Bid 1,105,843.31 Co., Ltd. Gruarantees/Deposit Total 8,667,213.38 -- Other notes 120 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 27. Non-current liabilities due within 1 year In RMB Items Balance year-end Year-beginning balance Long-term loans due within 1 year 1,583,780,000.00 1,218,610,000.00 Total 1,583,780,000.00 1,218,610,000.00 Other notes:Long-term borrowing rate is 4.275%-5.60%。 28.Other current liabilities In RMB Items Balance year-end Year-beginning balance Tax on items to be rescinded 689,978.75 Total 689,978.75 29. Long-term loan (1) Category of long-term loan Items Balance year-end Year-beginning balance Pledge loan 199,000,000.00 199,000,000.00 Guaranteed loans 750,000,000.00 1,125,000,000.00 Credit loans 3,442,170,000.00 3,420,170,000.00 Total 4,391,170,000.00 4,744,170,000.00 Notes : The Pledge loan rate is 4.275%-4.35%; the guaranteed loan interest rate is 5.6%; the credit interest rate is 4.20%-4.90%. 30. Long-term payable (1) Long-term payable listed by nature of the account In RMB Items Balance year-end Year-beginning balance Non-operating asset payable 2,022,210.11 2,022,210.11 31. Stock capital In RMB Balance Balance Year-beginning Balance year-end 121 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Year-beginning Issuing of Bonus Transferred Other Subtotal new share shares from reserves Total of capital 2,090,806,126.00 2,090,806,126.00 shares 32. Capital reserves In RMB Items Year-beginning balance Increase in the current Decrease in the current Year-end balance period period Share premium 2,508,401,790.51 2,508,401,790.51 Other capital reserves 1,667,959.25 3,946,375.55 5,614,334.80 Total 2,510,069,749.76 3,946,375.55 2,514,016,125.31 - The situation of change in the current capital reserve is as follows: The capital reserve in this period was increased 3,951,780.00 yuan due to the change of the owner's equity of the joint-stock company ---- Guangdong Guanghui Expressway Co., Ltd. and was decreased 5,404.45 yuan due to the change of owner's equity of the joint-stock company ---- Guoyuan securities Co., Ltd. 122 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 33. Other comprehensive income In RMB Amount of current period Less : Previously recognized After - tax att Amount for the p After - tax attrib Year-end Items Year-beginning balance ributable to m in profit or loss in oth balance eriod before inco Less:Income tax utable to the pare er comprehensive inco inority shareh me tax nt company me olders 2.Other comprehensive income reclassifiable to 327,263,824.17 -96,732,906.59 -22,937,357.04 -73,795,549.55 253,468,274.62 profit or loss in subsequent Incluidng: Share of other combined gains and losses that will be reclassified into profits and 847,589.37 -4,983,478.43 -4,983,478.43 -4,135,889.06 losses after the invested unit under the equity method Gains and losses from changes in fair value of avai 326,416,234.80 -91,749,428.16 -22,937,357.04 -68,812,071.12 257,604,163.68 lable for sale financial assets Total of other comprehensive income 327,263,824.17 -96,732,906.59 0.00 -22,937,357.04 -73,795,549.55 253,468,274.62 Other notes, including the adjustment of the recognition of initial amount of effective part of the cash flow hedging gains and losses transfer into arbitraged items: The initial balance and the ending balance refer to other comprehensive incomes in the balance sheet. The initial balance + other comprehensive incomes belong to the parent company after taxes = the ending balance. The occurrence amount in the period refers to other comprehensive incomes in the profit statement, and the occurrence amount before income tax in the period – Other comprehensive income recorded in the earlier stage and transferred into the profits and losses in the current period – income taxes = other comprehensive incomes belong to the parent company after taxes + other comprehensive incomes belong to the minority shareholders after taxes. 123 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 34. Surplus reserve In RMB Items Year-beginning balance Increase in the current Decrease in the current Year-end balance period period Statutory surplus 544,821,130.03 544,821,130.03 reserve Total 544,821,130.03 544,821,130.03 35. Retained profits In RMB Items Amount of this period Amount of last period Before adjustments: Retained profits in last period 3,550,110,288.49 2,920,563,328.27 end After adjustments: Retained profits at the period 3,550,110,288.49 2,920,563,328.27 beginning Add:Net profit belonging to the owner of the 779,002,246.98 1,509,922,398.70 parent company Less: Statutory surplus reserve 177,864,580.14 Common stock dividend payable 1,057,947,899.76 702,510,858.34 Retained profit at the end of this term 3,271,164,635.71 3,550,110,288.49 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. (5) Other adjustment of the total affected beginning undistributed profits are RMB 0.00 . 124 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 36.Operation income and operation cost In RMB Amount of this period Amount of last period Items Income Cost Income Cost Main operation 1,518,875,852.56 522,317,994.54 1,418,719,988.26 523,456,284.40 Other operation 16,988,292.58 11,418,571.81 21,502,575.48 10,233,560.76 Total 1,535,864,145.14 533,736,566.35 1,440,222,563.74 533,689,845.16 37. Business tax and subjoin In RMB Items Amount of this period Amount of last period Urban construction tax 2,938,753.34 2,760,207.40 Education surcharge 1,380,805.75 1,290,500.11 Property tax 661,486.13 677,877.95 Land use tax 603,977.11 767,994.64 Stamp tax 242,575.38 358,071.25 Business tax 25,872.66 26,341.89 Locality Education surcharge 920,536.09 860,324.55 Defend expense 384.04 Other 79,108.53 154,073.23 Total 6,853,114.99 6,895,775.06 Other notes: 38. Administrative expenses In RMB Items Amount of this period Amount of last period Wage 49,712,683.56 49,157,515.03 Depreciation and Amortization 5,428,661.13 7,247,599.37 R & D expenses 2,485,173.03 3,249,337.10 Low consumables amortization 279,304.70 245,247.83 Travel expenses 384,417.28 128,401.26 Office expenses 2,828,218.57 2,541,048.21 Leased expenses 5,606,396.14 5,778,380.50 125 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Items Amount of this period Amount of last period The fee for hiring agency 2,202,760.36 2,396,071.67 Consultation expenses 853,466.98 1,524,000.00 Directorate expenses 9,376.00 Listing fee 11,320.76 11,320.76 Information cost and maintenance fee 48,300.00 505,424.13 Other 5,753,931.46 4,900,192.98 Total 75,594,633.97 77,693,914.84 Other notes: 39.Financial expenses In RMB Items Amount of this period Amount of last period Interest expenses 125,752,286.60 147,292,451.79 Deposit interest income(-) -18,076,236.30 -15,653,886.22 Exchange Income and loss(Gain-) 2,348,188.17 -1,522,372.61 Bank commission charge 2,755,977.00 3,688,166.06 Total 112,780,215.47 133,804,359.02 Other notes: 40 Asset impairment loss In RMB Items Amount of this period Amount of last period I. Bad debt loss -57,890.35 196,581.08 Total -57,890.35 196,581.08 Other notes: 41. Investment income In RMB Items Amount of this period Amount of last period Long-term equity investment income by equity 216,777,157.34 199,376,107.62 method Hold the investment income during from 42,581,144.86 24,054,256.82 available-for-sale financial assets 126 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Total 259,358,302.20 223,430,364.44 Other notes: 42.Assets disposal income In RMB Source Amount of this period Amount of last period Income form disposal of fixed assets 44,860,186.67 43. Non-Operation income In RMB Recorded in the amount of the Items Amount of this period Amount of last period non-recurring gains and losses Government Subsidy 197,210.65 Total gains from disposal of 110,018.02 110,018.02 non-current assets Including:Gains from disposal 110,018.02 110,018.02 of fixed assets Road property claim income 736,148.53 822,425.45 736,148.53 Other income(Notes) 1,841,394.03 61,279,442.48 1,841,394.03 Total 2,687,560.58 62,299,078.58 - Government subsidy reckoned into current gains/losses In RMB Whether the impact of Whhether Amount of Amount of Assets-relate Issuing subsidies on Subsidy items Issuing body Nature special current previous d/income – reason the current subsidies period period related profit and loss Stable job Related to 197,210.65 subsidies income Total -- -- -- -- -- 197,210.65 -- Other notes: Note: the other gains in this period include the early termination of toll payment compensation of 59,995,667.68 yuan received from State Road 325 Jiujiang Bridge, which is included in the cash flow statement Other Cash Received Relating To Investing Activities. 127 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 44. Non-Operation expense In RMB The amount of non-operating Items Amount of current period Amount of previous period gains & losses Loss of destruction of assets 505,483.87 2,629,016.43 505,483.87 Fine 357,855.32 32,684.30 357,855.32 Other 1,144,628.24 437,773.53 1,144,628.24 Total 2,007,967.43 3,099,474.26 2,007,967.43 45. Income tax expense (1) Lists of income tax expense In RMB Items Amount of current period Amount of previous period Current income tax expense 179,094,084.83 203,294,551.97 Deferred income tax expense 34,127,634.02 -223,234,633.95 Total 213,221,718.85 -19,940,081.98 (2) Adjustment process of accounting profit and income tax expense In RMB Items Amount of current period Total profits 1,111,855,586.73 Current income tax expense accounted by tax and relevant 277,963,896.69 regulations Effect of different tax rates on subsidiary companies Influence of income tax before adjustment -2,858,712.81 Influence of non taxable income -64,839,575.55 Impact of non-deductible costs, expenses and losses 1,888,749.15 Affect the use of deferred tax assets early unconfirmed deductible losses The current period does not affect the deferred tax assets 1,067,361.37 recognized deductible temporary differences or deductible loss Income tax expense 213,221,718.85 128 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 46. Items of Cash flow statement (1) Other cash received from business operation In RMB Items Amount of current period Amount of previous period Newwork received toll income 38,176,722.70 Interest income 18,076,236.30 15,653,886.22 Unit current account 21,370,093.68 6,988,367.43 Total 39,446,329.98 60,818,976.35 Notes: Nil (2)Other cash paid related to oprating activities In RMB Items Amount of current period Amount of previous period Management expense 18,068,478.74 22,338,978.13 Unit current account 11,909,230.86 Network received toll incom 3,803,254.03 2,160,313.24 Total 21,871,732.77 36,408,522.23 Notes: Nil (3)Other Cash received related to investment activities In RMB Items Amount of current period Amount of previous period Jiujiang bridge to receive compensation 59,995,667.68 Total 59,995,667.68 Notes: Nil (4)Other Cash payable related to investment activities Nil (5)Other Cash received related to Financing activities In RMB Items Amount of current period Amount of previous period Interest discount 2,500,000.00 129 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Total 2,500,000.00 Notes: ⑹Other Cash payable related to financing activities Nil 47. Supplement Information for cash flow statement (1)Supplement Information for cash flow statement In RMB Supplement Information Amount of current period Amount of previous period I. Adjusting net profit to cash flow from -- -- operating activities Net profit 898,633,867.88 990,512,139.32 Add: Impairment loss provision of assets -57,890.35 196,581.08 Depreciation of fixed assets, oil and gas 398,876,127.65 409,188,339.82 assets and consumable biological assets Amortization of intangible assets 1,318,922.34 1,772,083.08 Amortization of Long-term deferred 55,661.40 906,502.02 expenses Loss on disposal of fixed assets, intangible -44,860,186.67 assets and other long-term deferred assets Fixed assets scrap loss 395,465.85 2,629,016.43 Financial cost 128,100,474.77 145,770,079.18 Loss on investment -259,358,302.20 -223,430,364.44 Decrease of deferred income tax assets 54,102,320.89 -211,984,848.18 Increased of deferred income tax liabilities -42,912,043.91 -11,249,785.77 Decrease of inventories -139,076.49 Decease of operating receivables -4,522,183.33 -40,231,085.00 Increased of operating Payable -312,353,569.73 -41,686,422.17 Net cash flows arising from operating 817,279,588.10 1,022,392,235.37 activities 130 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Supplement Information Amount of current period Amount of previous period II. Significant investment and financing -- -- activities that without cash flows: 3.Movement of cash and cash equivalents: -- -- Ending balance of cash 1,821,466,139.37 2,596,273,900.39 Less: Beginning balance of cash equivalents 2,363,042,700.42 2,603,279,644.25 Net increase of cash and cash equivalents -541,576,561.05 -7,005,743.86 (2) Net Cash paid of obtaining the subsidiary Nil (3) Net Cash receive of disposal of the subsidiary Nil (4)Composition of cash and cash equivalents In RMB Items Balance in year-end Balance in year-Beginning 1,821,466,139.37 2,363,042,700.42 I. Cash 82,371.11 66,065.04 Of which: Cash in stock Bank savings could be used at any time 1,820,722,446.96 2,362,279,050.70 Other monetary capital could be used at any 661,321.30 697,584.68 time III. Balance of cash and cash equivalents at 1,821,466,139.37 2,363,042,700.42 the period end Other notes: Nil 48. 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.:Nil 49. The assets with the ownership or use right restricted Other notes: Up to June 30, 2018, Jingzhu Expressway Guangzhu Section Co., Ltd., the controlling grandchildren company of the Company, with the toll collection right of Panyu Tangkeng-Zhuhai Jinding section project in Jingzhu expressway, asked for 449,000,000.00 yuan of loan from Guangzhou Wuyang Branch of ICBC to provide 131 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 pledge guarantee(of which the non-current debt balance with 1-year expiration was 250,000,000.00 yuan and the long-term loan balance was 199,000,000.00 yuan). 50. Foreign currency monetary items (1) Foreign currency monetary items Nil (2) Note to oversea entities including: for significant oversea entities, shall disclose main operating place, recording currency and selection basis, if there are changes into recording currency, shall also disclose the reason. □ Applicable √ Not applicable VIII.Changes of consolidation scope 1.Enterprise consolidation not under the same control (1)Enterprise consolidation not under the same control in reporting period Nil。 (2) Consolidation Cost and Goodwill Nil。 (3) The identifiable assets and liabilities of acquiree at purchase date Nil (4)Gains or losses of the equity held before prurchasing date, arising from re-measured byfair value Realized enterprise combine step by step through multi-trading and dealing obtained controlling rights in period □ Yes √No (5)On purchasing date or current combine period, fails to determine the combination consideration or acquiree’s fair value ofidentifiable assets and liabilities rationally Nil (6)Other notes 2.Enterprise consolidation under the same control (1)Merger of enterprises under the same control that occurred in the current period Nil 132 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (2)Combined cost Nil (3)Book value of assets and liabilities of party to be consolidated on the date of consolidation Nil 3. Counter purchase Basic information of transactions , basis of transactions constituting counter purchase, whether assets and liabilities reserved by listedcompanies constituting business and their basis, confirmation of combined cost, the amount occurred when adjusting rights and interests in accordance with equity transaction and its calculation Nil 4. The disposal of subsidiary Whether there are multiple transactions step by step dispose the investment to subsidiary and lost control in reporting period □ Yes √ No Dispose subsidiary step by step throuth multi-dealings and losing controlling rights in the period □ Yes √ No 5. Other reasons for the changes in combination scope Notes to reasons for the changes in combination scope (Newly established subsidiary and subsidiary of liquidation) and relevant information Nil 6.Other Nil IX. Equity in other entities 1. Equity in subsidiary (1) The structure of the enterprise group Main Shareholding Ratio Registratio Nature of Name of Subsidiary Places of (%) Obtaining Method n Place Business Operation direct indirect Under the same Guangzho Expressway control business Guangdong Fokai Expressway Co., Ltd. Foshan 100.00% Management u combination 133 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Under the same Guangzho Expressway control business Guangfo Expressway Co., Ltd. Guangzhou 75.00% Management u combination Investment in technical Guangdong Expressway Technology Guangzho Guangzhou industries and 100.00% Investment Investment Co., Ltd. u provision of relevant Under the same Guangzhuo Guangzhu Traffic Guangzho Investment control business Guangzhou 100.00% Investment Management Co., Ltd. u management combination Under the same Jingzhu Expressway Guangzhu Section Guangzho Expressway Zhongshan 20.00% 55.00% control business Co.,Ltd.(Notes) u Management combination Yuegao Capital Investment Guangzhou Zhuhai 100.00% Investment Investment(Hengqin)Co., Ltd. management Notes: holding proportion in subsidiary different from voting proportion:Nil Basis of holding half or less voting rights but still been controlled investee and holding more than half of the voting rights not been controlled investee:Nil Significant structure entities and controlling basis in the scope of combination:Nil Basis of determine whether the Company is the agent or the principal: Nil Other notes: Jingzhu Expressway Guangzhu Section Co., Ltd. is a non-wholly owned subsidiary of Guangzhou Guangzhu Traffic Investment Management Co., Ltd. (2) Important Non-wholly-owned Subsidiary In RMB Profit or Loss Owned by Dividends Distributed to Shareholding Ratio of Equity Balance of the the Minority the Minority Name of Subsidiary Minority Shareholders Minority Shareholders in Shareholders in the Shareholders in the (%) the End of the Period Current Period Current Period Guangfo Expressway 25.00% 35,608,835.93 53,528,891.62 109,373,543.63 Co., Ltd. Jingzhu Expressway Guangzhu Section 25.00% 84,022,784.97 144,223,171.04 243,545,577.61 Co.,Ltd. Holding proportion of minority shareholder in subsidiary different from voting proportion:Nil Nil 134 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (3) The main financial information of significant not wholly owned subsidiary In RMB Year-end balance Year-beginning balance Name Non current Current Non current Current Non current Current assets Total assets Total liabilities Current assets Non current assets Total assets Total liabilities assets Liabilities liabilities Liabilities liabilities Guangfo Expresswa 472,299,438.17 20,952,248.13 493,251,686.30 55,757,511.78 55,757,511.78 544,211,527.04 21,454,392.65 565,665,919.69 56,491,522.41 56,491,522.41 y Co., Ltd. Jingzhu Expresswa y 278,137,611.59 2,401,595,681.34 2,679,733,292.93 606,795,297.17 1,098,755,685.26 1,705,550,982.43 168,092,185.25 2,692,035,039.19 2,860,127,224.44 526,412,997.55 1,118,730,372.13 1,645,143,369.68 Guangzhu Section Co.,Ltd. In RMB Amount of current period Amount of previous period Total Total Name Cash flows from Cash flows from Business income Net profit Comprehensive Business income Net profit Comprehensive operating activities operating activities income income Guangfo Expressway Co., Ltd. 226,325,833.32 142,435,343.71 142,435,343.71 145,431,353.01 201,131,785.00 98,378,474.42 98,378,474.42 129,165,512.93 Jingzhu Expressway Guangzhu 645,871,184.09 336,091,139.89 336,091,139.89 433,240,710.71 631,857,976.08 292,278,032.76 292,278,032.76 443,338,931.03 Section Co.,Ltd. 135 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (4) Significant restrictions of using enterprise group assets and pay off enterprise group debt Nil (5) Provide financial support or other support for structure entities incorporate into the scope of consolidated financial statements Nil 2. The transaction of the Company with its owner’s equity share changed but still controlling the subsidiary (1)Description of changes in share of owners' equity in subsidiaries Nil (2)The influence of transaction on minority shareholders' equity and ownership of parent company Nil 3. Equity in joint venture arrangement or associated enterprise (1) Significant joint venture arrangement or associated enterprise Proportion Accounting treatment of the Main operating investment of Name Registration place Business nature place Directly Indirectly joint venture or associated enterprise Guangdong Guanghui Expressway Co., Guangzhou, Guangzhou, Expressway 30.00% Equity method Ltd. Guangdong Guangdong Management Zhaoqing, Zhaoqing, Expressway Zhaoqing Yuezhao Highway Co., Ltd. 25.00% Equity method Management Guangdong Guangdong Shenzhen Shenzhen Expressway Shenzhen Huiyan Expressway Co., Ltd. 33.33% Equity method Guangdong Guangdong Management Guangdong Jiangzhong Expressway Co., Zhongshan , Guangzhou,Guang Expressway 15.00% Equity method Ltd. Guangdong dong Management Gangzhou, Expressway Ganzhou kangda Expressway Co., Ltd. Gangzhou, Jiangxi 30.00% Equity method Jiangxi Management Gangzhou, Expressway Ganzhou Gankang Expressway Co., Ltd. Gangzhou, Jiangxi 30.00% Equity method Jiangxi Management Guangdong Yueke Technology Petty Loan Guangzhou, Guangzhou, Hande all kinds of 20.00% Equity method Co., Ltd. Guangdong Guangdong small loans Guangyuan Securities Co., Ltd. Hefei, Anhui Hefei, Anhui Security business 2.37% Equity method Notes to holding proportion of joint venture or associated enterprise different from voting proportion: Nil 136 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Basis of holding less than 20% of the voting rights but has a significant impact or holding 20% or more voting rights but does not have a significant impact: Guangdong, Jiangzhong Expressway Co., Ltd and Guangyuan Securities Co., Ltd... holds 20% of the voting rights, but has the power to participate in making decisions on their financial and op erating decisions, and therefore deemed to be able to exert significant influence over the investee. (2) Main financial information of significant joint venture In RMB Year-end balance/ Amount of current period Year-beginning balance/ Amount of previous period Guangdong Guanghui Zhaoqing Yuezhao Guangdong Guanghui Zhaoqing Yuezhao Expressway Co., Ltd. Highway Co., Ltd. Expressway Co., Ltd. Highway Co., Ltd. Current assets 1,010,036,752.52 94,167,495.08 398,201,907.66 217,772,715.63 Including:Cash and cash 439,281,500.91 75,926,440.69 119,447,466.86 199,426,500.59 equivalent Non-current assets 3,859,333,751.56 1,622,591,424.78 4,288,934,082.82 1,780,232,314.01 Total assets 4,869,370,504.08 1,716,758,919.86 4,687,135,990.48 1,998,005,029.64 Current liabilities 412,511,339.43 123,542,015.68 330,054,720.57 178,262,191.50 Non-current liabilities 956,222,984.63 483,404,091.87 1,144,392,235.39 626,350,940.66 Total liabilities 1,368,734,324.06 606,946,107.55 1,474,446,955.96 804,613,132.16 Attributable to shareholders of the 3,500,636,180.02 1,109,812,812.31 3,212,689,034.52 1,193,391,897.48 parent company Share of net assets 1,050,190,854.01 277,453,203.08 963,806,710.36 298,347,974.37 calculated by stake Book value of equity investment in joint 1,050,190,854.01 277,453,203.08 963,806,710.36 298,347,974.37 ventures Operating income 878,931,209.54 264,667,911.36 856,966,099.09 247,342,570.61 Financial expenses 18,892,654.01 11,944,947.35 24,124,233.53 14,270,879.40 Income tax expenses 152,535,401.50 39,485,100.11 142,913,805.63 34,089,839.29 Net profit 447,126,957.50 114,543,781.53 427,632,054.17 100,385,189.33 Total comprehensive 447,126,957.50 114,543,781.53 427,632,054.17 100,385,189.33 income Dividends received fromjoint ventures this 37,805,847.20 43,088,859.48 81,106,373.29 55,172,678.59 year 137 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (3) Main financial information of significant associated enterprise In RMB Year-end balance/ Amount of current period Year-beginning balance/ Amount of previous period Guangdong Guangdong Shenzhen Guangdong Ganzhou Shenzhen Guangdong Ganzhou Ganzhou Yueke Ganzhou Yueke Huiyan Jiangzhong Gankang Guoyuan Securities Huiyan Jiangzhong Gankang Guoyuan Securities Kangda Technology Kangda Technology Expressway Expressway Expressway Co., Ltd. Expressway Expressway Expressway Co., Ltd. Expressway Petty Loan Expressway Petty Loan Co., Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd Ltd Current 405,207,810.22 248,231,394.20 42,966,757.14 233,084,279.62 1,652,472,098.57 49,397,674,847.66 430,404,563.50 147,279,650.98 21,995,366.33 208,757,705.55 1,573,602,864.36 45,296,573,799.43 assets Non-curren 269,450,654.70 1,580,794,827.17 1,486,108,682.60 1,402,532,326.66 40,071,899.26 34,336,691,453.00 190,289,654.66 1,697,555,010.40 1,509,053,324.26 1,434,291,913.76 40,112,141.62 34,917,940,371.90 t assets Total 674,658,464.92 1,829,026,221.37 1,529,075,439.74 1,635,616,606.28 1,692,543,997.83 83,734,366,300.66 620,694,218.16 1,844,834,661.38 1,531,048,690.59 1,643,049,619.31 1,613,715,005.98 80,214,514,171.33 assets Current 32,625,265.20 141,621,528.98 50,492,867.09 103,913,052.05 310,168,218.91 48,028,217,706.35 32,102,623.52 129,152,634.01 100,119,184.60 114,676,781.53 236,708,624.01 36,083,651,550.94 liabilities Non-curren 510,000,000.00 736,557,033.78 840,187,164.64 2,005,000.00 10,818,777,059.82 559,000,000.00 735,033,096.47 847,023,826.63 2,006,250.00 18,738,432,070.64 t Liabilities Total 32,625,265.20 651,621,528.98 787,049,900.87 944,100,216.69 312,173,218.91 58,846,994,766.17 32,102,623.52 688,152,634.01 835,152,281.07 961,700,608.16 238,714,874.01 54,822,083,621.58 liabilities MinoritySh areholders 265,639,882.10 11,146,865.79 297,258,467.45 12,064,185.84 ’ Equity Shareholde 642,033,199.72 1,177,404,692.39 742,025,538.87 691,516,389.59 1,114,730,896.82 24,876,224,668.70 588,591,594.64 1,156,682,027.37 695,896,409.52 681,349,011.15 1,077,741,664.52 25,380,366,363.91 rs’ equity 138 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Year-end balance/ Amount of current period Year-beginning balance/ Amount of previous period Guangdong Guangdong Shenzhen Guangdong Ganzhou Shenzhen Guangdong Ganzhou Ganzhou Yueke Ganzhou Yueke Huiyan Jiangzhong Gankang Guoyuan Securities Huiyan Jiangzhong Gankang Guoyuan Securities Kangda Technology Kangda Technology Expressway Expressway Expressway Co., Ltd. Expressway Expressway Expressway Co., Ltd. Expressway Petty Loan Expressway Petty Loan Co., Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd Ltd attributable to shareholde rs of the parent Pro rata sh are of the n 214,011,066.57 176,610,703.86 222,607,661.66 207,454,916.88 222,946,179.36 588,390,445.65 196,197,198.21 173,502,304.11 208,768,922.86 204,404,703.35 215,548,332.90 600,314,769.41 et assets ca lculated --Goodwill 206,725,818.02 206,725,818.02 The book v alue of equ ity investm 214,011,066.57 176,610,703.86 222,607,661.66 207,454,916.88 222,946,179.36 795,116,263.67 196,197,198.21 173,502,304.11 208,768,922.86 204,404,703.35 215,548,332.90 807,040,587.43 ents in join t ventures Fair value of equity investment of 589,054,696.40 875,621,846.00 associated enterprises with open 139 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Year-end balance/ Amount of current period Year-beginning balance/ Amount of previous period Guangdong Guangdong Shenzhen Guangdong Ganzhou Shenzhen Guangdong Ganzhou Ganzhou Yueke Ganzhou Yueke Huiyan Jiangzhong Gankang Guoyuan Securities Huiyan Jiangzhong Gankang Guoyuan Securities Kangda Technology Kangda Technology Expressway Expressway Expressway Co., Ltd. Expressway Expressway Expressway Co., Ltd. Expressway Petty Loan Expressway Petty Loan Co., Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd. Co., Ltd Ltd quotation Buinsess 121,958,669.64 238,655,329.27 113,055,381.54 78,967,126.91 91,160,960.52 1,109,717,564.95 111,790,599.41 230,951,536.63 124,080,732.78 71,517,295.42 82,267,976.87 incme Net profit 53,441,605.08 45,984,003.63 46,129,129.35 10,167,378.44 36,989,232.30 211,597,500.90 48,844,131.82 45,616,389.11 49,684,621.82 3,931,224.57 44,169,388.24 Other comprehensi -210,693,647.23 ve income Total comprehen 53,441,605.08 45,984,003.63 46,129,129.35 10,167,378.44 36,989,232.30 903,853.67 48,844,131.82 45,616,389.11 49,684,621.82 3,931,224.57 44,169,388.24 sive income Dividends received fr om associa 3,789,200.79 11,940,297.90 tes during t he year 140 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (4) Summary financial information of insignificant joint venture or associated enterprise Nil (5) Note to the significant restrictions of the ability of joint venture or associated enterprise transfer funds to the Company Nil (6)The excess loss of joint venture or associated enterprise (7) The unrecognized commitment related to joint venture investment Nil (8) Contingent liabilities related to joint venture or associated enterprise investment Nil 4. Significant common operation Nil 5. Equity of structure entity not including in the scope of consolidated financial statements Notes: Nil 6.Other Nil X. Risks Related to Financial Instruments The major financial instruments of the company include monetary capital, accounts receivable and accounts payable. These financial instruments are primarily related to operating and financing. For the details of the financial instruments, please refer to the related projects in Notes 5. The risk relevant to these financial instruments and the risk management policy adopted by the company for reducing these risks are described as below: 1. Credit Risk The credit risk means that the party of the financial instrument fails to perform the obligations, and the risk of the financial loss is caused for the other party. The company is mainly facing the customer credit risk due to the credit sale. In order to reduce the credit risk, the company only makes transactions with the recognized and reputable customers, and carries out the continuous monitoring of accounts receivable through monitoring the credit of the existing customers and the aging analysis, in order to ensure the company not facing the risk of bad debts and control the overall credit risk within the controllable range. 141 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 2. Interest Rate Risk The interest rate risk refers to the fluctuation risk appearing for the fair value of financial instruments or future cash flows due to the changes in market interest rate. The interest rate risk faced by the company is mainly from the bank borrowings. Through the establishment of good relations between banks and enterprises, the company makes the reasonable design of credit range, credit variety and credit limit to guarantee the sufficient credit range of the banks and meet the financing demands. Shortening the duration of single borrowings and especially stating the prepayment terms is to reasonably reduce the risk of the interest rate fluctuations. 3. Foreign Exchange Risk The foreign exchange risk refers to the fluctuation risk appearing for the fair value of financial instruments or future cash flows due to the changes in foreign exchange rate. The company matches the income and expenditure of foreign currency as far as possible in order to reduce the foreign exchange risk. During the reporting period, the company has little effect on the foreign exchange risk due to the short credit term of revenue and expenditure related to the foreign currency. 4. Liquidity Risk The liquidity risk means that the risk of the shortage of funds occurs when the settlement obligations by the delivery of the cash or other financial assets are fulfilled by the company. The policy of the company is to ensure the sufficient cash for repaying the matured debts. The liquidity risk is under the centralized control of Finance department of the company, and Finance department shall guarantee the company having the sufficient funds to repay the debts under any reasonable forecast through monitoring the cash balance, the marketable securities available to be cash and the rolling forecast for the cash flow of the next six months. 5. Other Price Risk The company holds the equity investment of other listed companies, and the management believes that these investments facing the market price risk is acceptable. For the equity investment of other listed companies held by the company, please refer to “Available-for-Sale Financial Assets in Article 8 of Consolidated Financial Statement in Notes 5 of Financial Statements”. XI. The disclosure of the fair value 1. Closing fair value of assets and liabilities calculated by fair value In RMB Closing fair value Items Fir value measurement Fir value measurement Fir value measurement Total items at level 1 items at level 2 items at level 3 I. Consistent fair value -- -- -- -- measurement (II)Available-for-sale 861,033,095.04 861,033,095.04 Financial Assets (2)Equity instrument 861,033,095.04 861,033,095.04 investment Total of Consistent fair 861,033,095.04 861,033,095.04 value measurement 142 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 II.Non-continuous -- -- -- -- measurement fair value 2. Market price recognition basis for consistent and inconsistent fair value measurement items at level 1. As at the end of the period, the company holds shares 235,254,944 shares of China Everbright Bank According to the closing price of June 30, 2018 of 3.66 yuan, the final calculation of fair value was 861,033,095.04 yuan. 3. Valuation technique adopted and nature and amount determination of important parameters for consistent and inconsistent fair value measurement items at level 2. Nil 4. Sensitiveness analysis on unobservable parameters and adjustment information between opening and closing book value of consistent fair value measurement items at level 3. Nil 5. Sensitiveness analysis on unobservable parameters and adjustment information between opening and closing book value of consistent fair value measurement items at level 3. Nil 6. Explain the reason for conversion and the policy governing when the conversion happens if conversion happens among consistent fair value measurement items at different levels Nil 7. Changes in the valuation technique in the current period and the reason for change Nil 8. Fair value of financial assets and liabilities not measured at fair value Nil 9.Other XII. Related parties and related-party transactions 1. Parent company information of the enterprise The parent company The parent company Name Registered address Nature Redistricted capital of the Company's of the Company’s shareholding ratio 143 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 vote ratio Equity management, No.83,85, Baiyun Guangdong traffic infrastructure Road, Yuexiu communication construction and 2,680,000.00 24.55% 50.12% District, Group Co., Ltd railway project Guangzhou operation Notes : Guangdong Communication Group Co., Ltd. is the largest shareholder of the Company. legal representative: Deng Xiaohua. Date of establishment: June 23, 2000. As of June 30, 2018,Registered capital: 26.8 billion yuan. It is a solely state-owned limited company. Business scope:equity management, organization of asset reorganization and optimized allocation, raising funds by means including mortgage, transfer of property rights and joint stock system transformation, project investment, operation and management, traffic infrastructure construction, highway and railway project operation and relevant industries, technological development, application, consultation and services, highway and railway passenger and cargo transport, ship industry, relevant overseas businesses (if the above mentioned business scope requires licenses to operate, then operation licenses are required). The finial control of the Company was State owned assets supervision and Administration Commission of Guangdong Provincial People's Government. Other notes: Nil 2.Subsidiaries of the Company Subsidiaries of this enterprise, see Note IX the rights of other entity 3. Information on the joint ventures and associated enterprises of the Company The details Notes IX of significant joint venture and associated enterprise of the Company Information on other joint venture and associated enterprise of occurring related party transactions with the Company in reporting period, or form balance due to related party transactions in previous period: Nil 4. Other Related parties Name Relation with the Company Guangdong Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Chaohui Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Kaiyang Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Maozhan Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Yangmao Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Guangle Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Jiangzhao Expressway Management Center Managed by the parent company Guang-Shen-Zhu Expressway Co., Ltd. Fully owned subsidiary of the parent company 144 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Name Relation with the Company Guangdong Jiangzhong Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong West Coastal Expressway Xinhui Section Co., Ltd Fully owned subsidiary of the parent company Guangdong West Coastal Expressway Zhuhai Section Co., Ltd Fully owned subsidiary of the parent company Controlled by the same parent company and equity participation Guangdong Guangzhu West Line Expressway Co., Ltd. unit Guangdong Jingzhu Expressway Guangzhu North Section Co., Controlled by the same parent company and equity participation Ltd. unit Yunfu Guangyun Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Taishan Coastal Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Guanghui Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Highway Construction Co., Ltd. Fully owned subsidiary of the parent company Guangdong Xinyue Traffic Investment Co., Ltd. Fully owned subsidiary of the parent company Guangdong Litong Technology Investment Co., Ltd. Fully owned subsidiary of the parent company Controlled by the same parent company and equity participation Guangdong Humen Bridge Co., Ltd. unit Guangdong Yueyun Traffic Co., Ltd. Fully owned subsidiary of the parent company Guangdong Boda Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Baomao Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Guangfozhao Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Nanyue Traffic Shaogan Expressway Management Managed by the parent company Center Guangzhongjiang Expressway Project Management Managed by the parent company Guangdong Yuedong Expressway Development Co., Ltd. Fully owned subsidiary of the parent company Guangdong Road & Bridge Construction Development Co., Ltd. Fully owned subsidiary of the parent company Guangdong Shanfen Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Zhaoyang Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Hualu Traffic Technology Co., Ltd. Fully owned subsidiary of the parent company Guangdong Expressway Media Co., Ltd. Fully owned subsidiary of the parent company Guangdong Tongyi Expressway Service Area Co., Ltd. Fully owned subsidiary of the parent company Guangdong Union Electron Service Co., ltd. Fully owned subsidiary of the parent company Guangdong Changda Highway Engineering Co., Ltd. Fully owned subsidiary of the parent company Guangdong Lulutong Co., Ltd. Fully owned subsidiary of the parent company Guangdong Litong Investformation Technology Investment Fully owned subsidiary of the parent company Co., Ltd. 145 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Name Relation with the Company Guangdong Gaoda Property Development Co., Ltd. Fully owned subsidiary of the parent company Guangdong Pingxing Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Luoyang Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Hehui Expressway Co., Ltd. Fully owned subsidiary of the parent company Heyuan Helong Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Two Guang Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong West coastal Expressway Co., Ltd. Fully owned subsidiary of the parent company Zhongshan Yueyun Airoort Express Passenger Co., Ltd. Fully owned subsidiary of the parent company Guangdong East Thinking Management Technology Fully owned subsidiary of the parent company Development Co., Ltd. Guangzhou Yueyun Traffic Co., Ltd. Fully owned subsidiary of the parent company Xinyue Highway Construction Co., Ltd. Minority shareholders of the holding Sun-Subsidiarie Guangdong Meihe Expressway Co., Ltd. Fully owned subsidiary of the parent company Guangdong Litong Real Estate Co., Ltd. Fully owned subsidiary of the parent company Other notes 5. List of related-party transactions (1)Information on acquisition of goods and reception of labor service Acquisition of goods and reception of labor service In RMB Content of related Amount of current Amount of previous Over the trading limit Related parties Amount of last period transaction or not? period period Guangdong Unionelectronic Service 8,075,494.51 services co., Ltd. Guangdong Litong Technology Project fund 784,739.50 203,850.00 Investment Co., Ltd. Guangdong Humen Project 539,307.09 Bridge Co., Ltd. fund,service Guangdong Tongyi Expressway Service service 259,399.97 Area Co., Ltd 146 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Guangdong Project fund 25,393.54 Lulutong Co., Ltd. Guangdong Changda Highway Project fund 4,238,698.53 Engineering Co., Ltd. Guangdong Xinyue traffic Investment Project fund 55,800.00 Co., Ltd. Guangdong Guanghui Interest 1,349,043.75 Expressway Co., Ltd. Ganzhou Gangkang Expressway Co., Interest 765,623.34 1,051,109.99 Ltd. Guangdong Expressway Media service 606,132.08 Co., Ltd. Guangdong East Thinking Management service 60,000.00 178,066.11 Technology Development Co., Ltd. Guangdong Changda Highway Purchasing assets 34,838,755.49 1,924,312.81 Engineering Co., Ltd. Guangdong Hualu Traffic Technology Purchasing assets 1,548,686.53 Co., Ltd. Guangdong Xinyue Traffic Investment Purchasing assets 36,761.81 Co., Ltd. Guangdong Changda highway Project fund 634,217.37 Co., Ltd. Related transactions on sale goods and receiving services In RMB 147 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Related party Content Amount of current period Amount of previous period Jingzhu Expressway Guangzhu Commission 8,092,547.17 7,852,830.20 North section Co., Ltd. management fee Guangdong Expressway Co., Project fund 2,192,131.13 2,094,489.63 Ltd. Guangdong Luqiao Construction Development Co., Project fund 267,452.83 162,735.84 Ltd. Guangdong Guangzhu West Project fund 234,905.66 449,056.61 Line Expressway Co., Ltd. Guangdong Chaohui Project fund 192,452.83 192,452.83 Expressway Co., Ltd. Guangdong Guangfozhao Project fund 154,245.28 141,509.43 Expressway Co., Ltd. Guangdong Guanghui Project fund 144,339.62 147,169.81 Expressway Co., Ltd. Guangdong Guangle Project fund 142,924.53 200,943.40 Expressway Co., Ltd. Guangdong Kaiyang Project fund 134,035.68 235,922.47 Expressway Co., Ltd. Guangdong Boda Expressway Project fund 117,452.83 106,132.08 Co., Ltd. Guangdong Highway Project fund 116,037.74 Construction Co., Ltd. Zhaoqing Yuezhao Highway Project fund 101,886.79 192,452.83 Co., Ltd. Guangzhongjiang Expressway Project fund 89,622.64 Project Management Guangdong Jiangzhong Project fund 82,075.47 83,490.57 Expressway Co., Ltd. Guangdong West Coastal Expressway Zhuhai Section Project fund 80,660.38 107,547.17 Co., Ltd. Guangdong Taishan Coastal Project fund 59,433.96 Expressway Co., Ltd. Guangdong Litong Technology Project fund 35,384.62 95,000.00 Investment Co., Ltd. Yunfu Guangyun Expressway Project fund 35,377.36 28,301.89 148 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Co., Ltd. Guangdong Humen Bridge Project fund 26,886.79 19,811.32 Co.,Ltd. Shenzhen Huiyan Expressway Project fund 26,886.79 64,622.64 Co., Ltd. Guangdong Yueyun Traffic Project fund 21,226.42 51,415.10 Co.,Ltd. Guangdong West Coastal Expressway Xinhui Section Project fund 15,566.04 7,075.47 Co., Ltd. Guang-Shen-Zhu Expressway Project fund 594,339.64 Co., Ltd. Guangdong Xinyue Traffic Project fund 259,260.13 Investment Co., Ltd. Notes (2)Related trusteeship/contract Nil (3)Information of related lease The Company was lessor: In RMB The lease income confirmed in The lease income confirmed in Name of lessee Category of lease assets this year last year Guangdong Expressway Media Advertising lease 1,748.41 1,151,248.50 Co., Ltd. Guangdong Tongyi Expressway Service Area Lease 1,689,033.25 Service Area Co., Ltd. The company was lessee: In RMB The lease income confirmed in Lessor Category of leased assets Category of leased assets this year Guangdong Litong Property Office space 4,406,113.37 4,900,613.34 Investment Co., Ltd Guangdong Guanghui Advertising column lease 884,200.00 Expressway Co., Ltd. Zhaoqing Yuezhao Highway Advertising column lease 124,031.25 149 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Co., Ltd. Guangzhou Yueyun Traffic Co., Car Rental 97,530.00 Ltd. Guangdong Gaoda Property Office space 7,230.00 Development Co., Ltd. Guangdong Highway Office space 109,182.36 Construction Co., Ltd. Notes (4)Related-party guarantee The Company was Guarantor Nil The Company was secured party In RMB Execution accomplished Guarantor Guarantee amount Start date End date or not Guangdong Communication Group 1,725,000,000.00 September 25,2012 March 25,2020 No Co., Ltd. Notes: Controlling shareholder Guangdong Communication Group Co., Ltd. accepted Pacific Asset Management Co., Ltd. insurance debt investment plan to provide joint liability guarantee of principal and interest in full and unconditional irrevocable. The company held Guangzhou Guangzhu Traffic Investment Management Co., Ltd. 75% stake in Guangdong Communication Group Co., Ltd. to provide a counter-guarantee. (5) Inter-bank lending of capital of related parties In RMB Amount borrowed and Related party Initial date Due date Notes loaned Borrowed Ganzhou Gankang 50,000,000.00 February 2,2018 June 3,2018 Expressway Co., Ltd. Guangdong Guanghui 105,000,000.00 March 22,2018 September 21,2018 Expressway Co., Ltd. Guangdong Guanghui 45,000,000.00 May 22,2018 May 21,2019 Expressway Co., Ltd. Loaned 150 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (6) Related party asset transfer and debt restructuring Nil (7) Rewards for the key management personnel Ten thousand yuan Items Amount of current period Amount of previous period Rewards for the key management 241.51 205.84 personnel (8) Other related-party transactions -Capital Deposit Situation of Guangdong Provincial Communication Group Finance Co., Ltd. Items Amount of current period Amount of previous period Balance of Deposit 381,881,836.28 366,841,521.49 Interest Income 3,752,689.53 Refer to deposit interest rate at the corresponding period of Bank of China Pricing Principle On December 25, 2017 and December 22, 2017, the Company signed the Cash Management Business Cooperation Agreement with Guangdong Communications Group Finance Co., Ltd. and Industrial and Commercial Bank of China Guangdong Branch and signed the Cash Management Business Cooperation Agreement with Guangdong Communications Group Finance Co., Ltd. and China Construction Bank Corporation. Guangdong Branch respectively, to join in the cash pool of Guangdong Communications Group Finance Co., Ltd. -On June 15, 2016,The company’s 29th meeting (Provisional) of the seventh board of directors was convened. The Proposal on Entrustment of Construction Management of the Renovation and Expansion Project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway was deliberated in the meeting, agreed that Guangdong Provincial Fokai Expressway Co., Ltd entrusts Guangdong Provincial Highway Construction Co., Ltd with the construction management of the renovation and expansion project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway, and handling the related matters of the entrustment of the construction management. 6. Receivables and payables of related parties (1)Receivables In RMB 151 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Balance of Book Bad debt Provision Balance of Book Bad debt Provision Guangdong Union Account receivable electron Servce Co., 43,102,039.46 45,447,260.32 Ltd. Guangdong Humen Account receivable 27,048,223.47 9,425,822.31 Bridge Co., Ltd. Jingzhu Expressway Account receivable Guangzhu North 4,447,474.99 4,821,700.01 Section Co., Ltd. Guangdong Account receivable Expressway Co., 2,588,022.00 1,274,749.50 Ltd. Guangdong Xinyue Account receivable Traffic Investment 2,154,432.04 123,048.52 3,848,556.04 65,052.00 Co., Ltd. Guanghui Account receivable Expressway Co., 341,639.00 4,025,633.55 Ltd. Guangdong Road & Account receivable Bridge Development 283,500.00 Co., Ltd. Guangdong Kaiyang Account receivable Expressway Co., 312,321.40 4,425.00 379,837.72 Ltd. Guangdong West coastal Expressway Account receivable 269,694.00 55,258.20 352,194.00 55,258.00 Zhuhai Section Co., Ltd. Guangdong Guangzhu West Line Account receivable 249,000.00 356,850.40 Expressway Co., Ltd. Guangdong Chaohui Account receivable Expressway Co., 204,000.00 Ltd. Guangdong Guangfozhao Account receivable 163,500.00 Expressway Co., Ltd. 152 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Balance of Book Bad debt Provision Balance of Book Bad debt Provision Guangdong Guangle Account receivable Expressway Co., 151,500.00 Ltd. Guangdong Boda Account receivable Expressway Co., 124,500.00 Ltd. Guangdong Highway Account receivable 123,000.00 207,000.00 Construction Co., Ltd. Guangdong Road & Bridge Account receivable 111,000.00 Development Co., Ltd. Zhaoqing Yuezhao Account receivable 108,000.00 Highway Co., Ltd. Guangdong Zhongjiang Account receivable 95,000.00 Expressway Project Management Guangdong Jiangzhong Account receivable 87,000.00 Expressway Co., Ltd. Guangdong LitongTechnology Account receivable 68,542.00 6,854.20 201,342.00 Investment Co., Ltd. Guangdong Taishan Account receivable coastal Expressway 63,000.00 Co., Ltd. Guangdong West coastal Expressway Account receivable 50,610.00 10,233.00 67,110.00 10,233.00 Xinhui Section Co., Ltd. Yunfu Guangyun Account receivable Expressway Co., 37,500.00 Ltd. 153 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Balance of Book Bad debt Provision Balance of Book Bad debt Provision Guangdong West Account receivable coastal Expressway 30,000.00 3,000.00 30,000.00 2,830.00 Co., Ltd. Shenzhen Huiyan Account receivable Expressway Co., 28,500.00 Ltd. Guangdong Yueyun Account receivable 22,500.00 Traffic Co., Ltd. Guangdong Account receivable Expressway Media 1,799,600.00 Co., Ltd. Guang-Shen-Zhu Account receivable Exparessway Co., 189,000.00 Ltd. Guangdong Nanyue Traffic Shaogan Account receivable Expressway 179,424.00 Management Center Guangdong Maozhan Account receivable 166,196.80 Expressway Co., Ltd. Guangdong Baomao Account receivable Exparessway Co., 145,038.40 Ltd. Guangdong Yuedong Expressway Account receivable 139,976.80 Development Co., Ltd. Zhaoqing Yuezhao Advanced payment 20,671.75 144,703.00 Highway Co., Ltd. Guangdong Litong Advanced payment Property Investment 700,087.62 Co., Ltd. Guangdong Litong Other Account Property Investment 1,505,864.00 1,505,864.00 receivable Co., Ltd. 154 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Balance of Book Bad debt Provision Balance of Book Bad debt Provision Guangdong Other Account Guanghui 1,429,667.72 1,463,995.66 receivable Expressway Co., Ltd. Guangdong Other Account Expressway Co., 592,083.28 597,164.23 receivable Ltd. Other Account Zhaoqing Yuezhao 415,614.00 427,478.09 receivable Highway Co., Ltd. Guangdong Xinyue Other Account Traffic Investment 415,442.60 415,442.60 receivable Co., Ltd. Guangdong Other Account Guangzhu West Line 186,876.77 187,560.16 receivable Expressway Co., Ltd. Guang-Shen-Zhu Other Account Expressway Co., 185,014.40 223,371.78 receivable Ltd. Guangdong Other Account Expressway Media 120,568.54 1,213,926.84 receivable Co., Ltd. Guangdong Other Account Highway 107,494.67 115,058.75 receivable Construction Co., Ltd. Guangdong Jingzhu Other Account Expressway 63,502.68 63,612.63 receivable Guangzhu North Section Co., Ltd. Other Account Guangdong Humen 55,981.31 58,139.05 receivable Bridge Co., Ltd. Guangdong Guangle Other Account Expressway Co., 55,870.49 104,353.10 receivable Ltd. Guangdong Boda Other Account Expressway Co., 51,808.80 52,689.46 receivable Ltd. 155 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Balance of Book Bad debt Provision Balance of Book Bad debt Provision Guangdong Road & Bridge Other Account Construction 44,713.74 93,172.08 receivable Development Co., Ltd. Guangdong West Other Account Coastal Expressway 40,967.05 40,967.05 receivable Zhuhai section Co., Ltd Guangdong Other Account Jiangzhong 28,120.00 28,942.41 receivable Expressway Co., Ltd. Guangdong Gaoda Other Account Property 21,688.70 9,940.70 receivable Development Co., Ltd. Guangdong Other Account Yangmao 9,088.02 46,778.36 receivable Expressway Co., Ltd. Guangdong Other Account Maozhan 8,747.20 17,591.49 receivable Expressway Co., Ltd. Guangdong Shanfen Other Account Expressway Co., 8,028.80 8,028.80 receivable Ltd. Guangdong Baomao Other Account Expressway Co., 7,633.60 7,633.60 receivable Ltd. Guangdong Yuedong Other Account Expressway 7,367.20 7,367.20 receivable Development Co., Ltd. angdong West Other Account coastal Expressway 5,753.20 5,753.20 receivable Xinhui Section Co., 156 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Balance of Book Bad debt Provision Balance of Book Bad debt Provision Ltd. Guangdong Other Account LitongTechnology 5,273.00 5,273.00 receivable Investment Co., Ltd. Guangdong Other Account Zhaoyang 4,304.00 4,309.15 receivable Expressway Co., Ltd. Yunfu Guangyun Other Account Expressway Co., 3,565.19 11,628.49 receivable Ltd. Other Account Guangdong Yueyunt 3,032.00 3,032.00 receivable Traffic Co., Ltd. Guangdong Chaohui Other Account Expressway Co., 2,523.91 5,617.45 receivable Ltd. Guangdong Tongyi Other Account Expressway Service 2,182.70 receivable Area Co., ltd. Guangdong Meihe Other Account Expressway Co., 1,202.78 3,367.47 receivable Ltd. Guangdong Pingxing Other Account Expressway Co., 58.06 243.34 receivable Ltd. Guangdong Kaiyang Other Account Expressway Co., 88,827.08 receivable Ltd. Guangdong Other Account Jiangzhao 9,098.40 receivable Expressway Management Center Guangdong Nanyue Other Account Traffic Zhaogan 1,860.07 receivable Expressway Management Center Other Account Guangdong 1,685.28 157 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Balance of Book Bad debt Provision Balance of Book Bad debt Provision receivable Guangfozhao Expressway Co., Ltd. Heyuan Helong Other Account Expressway Co., 1,428.35 receivable Ltd. Guangdong Two Other Account Guang Expressway 556.32 receivable Co., Ltd. Guangdong Changda Other Non-Current Highway 23,937,725.40 15,937,725.40 Assets Engineering Co., Ltd. Guangdong Hualu Other Non-Current Communication 865,990.00 Assets Technology Co., Ltd. Guangdong East Thinking Other Non-Current Management 268,155.00 268,155.00 Assets Technology Development Co., Ltd. Note: if the related transaction is agreed to settle based on net amount, the amount after offsetting the amount due from related parties is filled in. (2)Payables In RMB Amount at year end Amount at year beginning Name Related party Guangdong Highway Account payable 45,980,021.00 75,980,021.00 Construction Co., Ltd. Guangdong Expressway Co., Account payable 8,746,491.18 8,746,491.18 Ltd. Guangdong Litong Technology Account payable 2,500,589.50 2,152,850.00 Investment Co., Ltd. Guangdong Guanghui Account payable 1,832,500.00 948,300.00 Expressway Co.,Ltd. 158 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Guangdong Union Electron Account payable 1,001,500.07 1.59 Service Co.,Ltd. Guangdong Xinyue Traffic Account payable 726,768.36 776,543.24 Investment Co., Ltd. Guangdong Expressway Media Account payable 642,500.00 Co., Ltd. Guangdong Changda Highway Account payable 500,931.38 14,449,499.60 Engineering Co.,Ltd. Guangdong Hualu Account payable Communication Technology 383,282.00 383,282.00 Co., Ltd. Guangdong Maozhan Account payable 120,000.00 Expressway Co.,Ltd. Guangdong Guanghui Interest payable 1,349,043.75 Expressway Co., Ltd. Guangdong Jingzhu Received in advance Expressway Guangzhu North 0.06 0.06 Section Co., Ltd. Guangdong Guanghui Other Payable account 150,000,000.00 20,221.75 Expressway Co.,Ltd. Guangdong Changda Highway Other Payable account 6,647,277.11 3,953,559.55 Engineering Co.,Ltd. Guangdong Union Electron Other Payable account 4,706,867.08 2,238,981.27 Service Co.,Ltd. Guangdong Xinyue Traffic Other Payable account 1,545,446.02 1,636,943.30 Investment Co., Ltd. Guangdong Litong Technology Other Payable account 1,470,184.76 Investment Co., Ltd. Guangdong Expressway Co., Other Payable account 334,706.01 350,680.10 Ltd. Guangdong Kaiyang Other Payable account 272,445.68 272,445.68 Expressway Co., Ltd. Guangdong East Thinking Other Payable account Management Technology 230,713.19 230,713.19 Development Co., Ltd. Guangdong Jiangzhong Other Payable account 215,384.63 215,384.63 Expressway Co., Ltd. 159 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Guangdong Zhongjiang Other Payable account Expressway Projict 200,000.00 200,000.00 Management Guangdong Maozhan Other Payable account 188,931.56 188,931.56 Expressway Co., Ltd. Guangdong Hualu Other Payable account Communication Technology 187,253.14 181,253.14 Co., Ltd. Guangdong Jingzhu Other Payable account Expressway Guangzhu North 166,578.00 13,553.00 Section Co., Ltd. Other Payable account Guangdong Lulutong Co., Ltd. 133,249.80 133,249.80 Guangdong Tongyi Expressway Other Payable account 120,000.00 120,000.00 Service Area Co., Ltd. Guangdong Expressway Media Other Payable account 70,000.00 70,000.00 Co., Ltd. Guangdong Jiangzhao Other Payable account Expressway Management 55,796.85 62,047.64 Center Guangdong Zhaoyang Other Payable account 49,171.27 49,171.27 Expressway Co.,Ltd. Guangdong West Coastal Other Payable account Expressway Zhuhai Section 48,146.64 48,146.64 Co., Ltd. Guangdong Baomao Other Payable account 45,719.63 48,950.59 Expressway Co., Ltd. Zhongshan Yueyun Airport Other Payable account EXPRESS Pessenger Transport 34,568.85 34,568.85 Co., Ltd. Guangdong Litong Information Other Payable account Technology Investment Co., 30,105.35 465,228.30 Ltd. Guang-Shen-Zhu Expressway Other Payable account 20,344.23 20,344.23 Co., Ltd. Guangdong Guangzhu West Other Payable account 18,981.84 18,981.84 Line Expressway Co., Ltd. Guangdong Litong Technology Other Payable account 16,376.20 16,376.20 Investment Co., Ltd. 160 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Amount at year end Amount at year beginning Name Related party Guangdong Highway Other Payable account 11,158.46 11,158.46 Construction Co., Ltd. Guangdong Shanfen Other Payable account 5,339.49 5,843.90 Expressway Co., Ltd. Guangdong Yuedong Other Payable account Expressway Development Co., 2,472.34 2,566.50 Ltd. Zhaoqing Yuezhao Highway Other Payable account 2,388.80 2,388.80 Co., Ltd. Guangdong Road &Bridge Other Payable account Construction Development Co., 1,948.02 2,435.71 Ltd. Guangdong Two Guang Other Payable account 1,603.02 1,603.02 Expressway Co., Ltd. Guangdong West Coastal Other Payable account 1,234.39 3,342.12 Expressway Co., Ltd. Heyuan Helong Expressway Other Payable account 896.89 896.89 Co., Ltd. Shenzhen Huiyan Expressway Other Payable account 564.92 946.81 Co., Ltd. Guangdong Luoyang Other Payable account 477.14 1,202.48 Expressway Co., Ltd. Guangdong Boda Expressway Other Payable account 408.23 408.23 Co., Ltd. Guangdong Hehui Expressway Other Payable account 216.43 216.43 Co., Ltd Guangdong Yangmao Other Payable account 2,817.71 Expressway Co., Ltd. Xinyue Highway Construction Dividend payable 25,000,000.00 12,500,000.00 Co., Ltd. XIII. Stock payment 1. The Stock payment overall situation □ Applicable √ Not applicable 161 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 2. The Stock payment settled by equity □ Applicable √ Not applicable 3. The Stock payment settled by cash □ Applicable √ Not applicable 4. Modification and termination of the stock payment Nil 5.Other Nil XIV. Commitments 1. Significant commitments Significant commitments at balance sheet date On June 15, 2016, the Company’ 29th meeting (Provisional) of the seventh board of directors was convened. In the meeting, the Proposal on Increasing Funding for Guangdong Fokai Expressway Co., Ltd pertaining to the Renovation and Expansion Project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway was examined and approved, agreed that based on the approved total investment amount by relevant government department, then the company’s subsidiary- Guangdong Fokai Expressway Co., Ltd carries out the investment and construction of the renovation and expansion project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway; the company increases funding for Guangdong Provincial Fokai Expressway Co., Ltd pertaining to the renovation and expansion project of Sanbao-to-Shuikou Section of Shengyang-to-Haikou National Expressway, with the contributed funds as a proportion of 35% of the total investment amount approved by relevant government department. The afore-said item had been examined and approved in the first extraordinary general shareholder meeting, The Company had received the approval of the National Development and Reform comission about the uandongProvincial Santbao-Shuikou Expressway Section Rebubuilding and Expansion Project(NO.1874-2016-NDRC Infrastructure Document)from Guangdong Provincel Development and reform Commission On October 11, 2016, agreed with the implementation of the Guangdong Provincial Sanbao-Shuikou Expressway Section Rebuilding and Expansion Project. It’s estimated that the total investment of this project is about 3.513 billion yuan(the static investment is about 3.289 billion yuan), of which the project capital is 1.23 billion yuan that accounts for 35% of the total investment and such amount of the project capital will be provided by Guangdong Provincial Fokai Expressway Co., Ltd, and the rest amount of 2,283 billion yuan will be solved by using bank loans. According to the "Official Reply to the preliminary design of reconstruction and extension project of Guangdong Sanbao to Shuikou Road by Ministry of Transport" (No.73-2017 Transport Road Document) issued by Guangdong Provincial Department of Transport, the Ministry of Transport checked and ratified that the general estimate of the preliminary design of reconstruction and extension project of Guangdong Sanbao to Shuikou Road is RMB 3.426 billion. As of June 30, 2018, The accumulated expenses 162 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 occurred of Guangdong Fokai Expressway Co.,Ltd was 1000.06 million yuan. 2. Contingency (1) Significant contingency at balance sheet date This matter. did not occur in this accounting period. (2) The Company have no significant contingency to disclose, also should be stated There was no significant contingency in the Company. XV. Enents after balance sheet date 1. Significant events had not adjusted The nineteenth (provisional) meeting of the eighth board of directors of the company was held on August 7, 2008. The meeting examined and approved the "Proposal on Issuing Medium-term Notes". It was agreed that the company's registration limit in the China Interbank Market Dealers Association should not exceed 3.4 billion yuan (including), and that the company's latest audit of 40% of its net assets should be within 40%. Medium-term notes within the period of 5 years (including 5 years) are to be issued by one-time or by stages. Funds are raised to repay loans and replenish operation capital. In August 23, 2018, the first provisional shareholders meeting of the company in 2018 passed the above proposal. The final issuance plan for the medium term notes is subject to the approval of the inter bank Dealers Association of China. l 2.Profit distribution Nil 3.Sales return Nil 4.Notes of other significant event after balance sheet date Nil XVI.Other significant events 1.The accounting errors correction in previous period This matter. did not occur in this accounting period. During the reporting period. 163 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 2.Debt restructuring This matter. did not occur in this accounting period. During the reporting period. 3.Replacement of assets This matter. did not occur in this accounting period. During the reporting period. 4.Pension plan The company does not disclose the pension plan undisclosed matter should exist. 5.Discontinuing operation This matter. did not occur in this accounting period. During the reporting period,. 6. Segment information The company's business for the Guangfo Expressway , the Fokai Expressway and Jingzhu Expressway Guangzhu Section toll collection and maintenance work, the technology industry and provide investment advice, no other nature of the business, no reportable segment. 7.Other (1)June 15,2007 early in the morning, The 325 Jiujiang Bridge collapsed on # 23 pier for ―Nanguijii 035# collision owned by the controlling subsidiary of the company Guangdong Fokai Expressway Company leads the collapse and the traffic jam of 200 meters long of the Jiujiang Bridge. On June 10, 2009, Jiujiang Bridge opened to traffic has been restored. On June 19,2007, The Ministry of Communications, the State Production Safety Supervision and Administration Commission issued the JiaoAnWeiming File [2007] No. 8 "Notification on the Guangdong"6.15 "Jiujiang Bridge Collision Accident", initially determined the causes of the accident are: the incident ship suddenly met heavy fog on the way from Foshan Gaoming to Sunde, the captain neglected looking out, did not take proper measures and deviated from the main channel, touched the 325 National Road Jiujiang Bridge the non-navigation bridge pier and caused the collapsion of part of the Jiujiang bridge. The accident was an uNilateral responsibility of the ship. On July 19,2007,Fokai Company applied preservation of property to Guangzhou Maritime Court.On August 22,2007,Fokai Company officially prosecuted to Guangzhou Maritime Court, asking Foshan South Sea Shipping Company Limited and Yang Xiong to undertake the conpensation 25,587,684 yuan for the loss caused by collapsion of Jiujiang Bridge. On August 28, 2007, Guangzhou Maritime Court accepted the case. According to the (2007)-Canton Haifa No. 332 ruling book issued by Guangzhou Maritime Court, the proceeding of the case was suspended. After the court accepted the case, the incident investigation team of Guangdong Provincial Government had not made the final report of Jiujiang Bridge accident. The Court, on November 5, 2007, decided to suspend the proceeding. In September 2008, Jiujiang Bridge accident investigation report was officially reported and resumed 164 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 the proceedings. On December 5, 2008, Guangzhou Marine Court opened a court trial to procceeded the case. Currently, Guangzhou Haizhu prosecutorial office was intend to prosecute the accident captain Shi Guide, therefore, on January 5, 2009, Guangzhou Maritime Court ruled the suspension of the case. On September 17, 2013, the Guangzhou Maritime Court issued a notice of civil and eliminate the cause of suspension of proceedings, the court decided to resume the trial. On December 19, 2013, the Guangzhou Maritime Court opened a court session, has not yet made the first-instance judgment. On March 7, 2014 the Court made the first instance verdict: the defendant Foshan Nanhai Yuhang ship Services Co., Ltd. and Yang Xiong compensated the plaintiff Fokai Expressway Co., Ltd. toll revenue losses of 19,357,500.96 yuan; the court dismissed the plaintiff other aspirations. The defendant appealed to the Higher People's Court of Guangdong Province, the Guangdong Provincial Higher People's Court ruled on June 5, 2014, the case discontinued proceedings. By the end of the report period, the abatement of action causes are already removed and the provincial higher court restores the hearing and conducts the investigation on April 21, 2017. (2)The 26th (Provisional)Meeting of the sixth board of directors of Guangdong Provincial Expressway Development Co., Ltd. was held of May 10, 2012. The meeting examined and adopted the proposal Concerning the Company’s Accepting the insurance Bond Investment Plan of Pacific Asset Management Co., Ltd. The Company was approved to accept the insurance bond investment plan made by Pacific Asset Management Co., Ltd. The amount of proceeds to be raised is not more than 1.5 billion yuan . Floating interest rate plus guaranteed base interest rate applies as the interest rate. The Floaing interest rate shall not exceed the basic interest rate of RMB loan with a term of over five years on the day when the investment fund of the insureance company is transferred into the Company’s account and the corresponding days of the future years, which shall be adjusted once each year. The guaranteed base interest rate is 5.6%. The concrete amount of raised proceeds shall be within maximum limit of investment fund filed with CIRC. The actual amount wholly transferred to the Company shall apply. The final interest rate is subject to investment Contract for Bond Investment Plan between Pacific and Guangdong Expressway Filed with CIRC. It was approved to authorize the management of the Company to implement the above-mentioned matters. The Company was approved to provide counter guarantee to Guangdong Communication Group Co.,Ltd.with 75% equity of Guangdong Fokai Expressway Co., Ltd. Held by it . as of December 31, 2016, the company has borrowed 1.5 billion yuan. (3)On February 5, 2016, the company received the Approval of the Share-Issuing to Parties such as Guangdong Provincial Expressway Co., Ltd to Purchase Assets and Raise Matching Funds by Guangdong Provincial Expressway Development Co., Ltd(CSRC No.230-2016 Zheng Jian Xu ke) issued from CSRC; the company’s scheme on share-issuance for purchasing assets and raising matching funds had been examined and approved by the Audit Committee of CSRC on Verifying and Approving Mergers, Acquisitions and Restructuring of Listed Companies. The company has completed asset restructuring in June 2016. During the profit compensation period, in the case that the actual profits of the underlying company were less than the committed profits, respectively the counterparts of Guangdong Provincial Expressway Co., Ltd and Guangdong Provincial Highway Construction Co., Ltd shall assume the obligation of compensation for the profit difference according to their equity proportion of Guangdong Provincial Fokai Expressway Co., Ltd and Guangzhou Guangzhu Traffic Investment Management Co., Ltd. The profit compensation period is three years from 2016-2018. Agreed by the company and Guangdong Provincial Expressway Co., Ltd, the profits of Fokai Expressway Co., Ltd in year-2016, year-2017 and year-2018 by estimation shall accordingly be 250.6973 million yuan, 260.0802 million yuan and 403.1197 million yuan, with the aggregated non-recurring gains and losses were 165 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 expected to be 105.5743 million yuan. During the compensation period, in the case that the cumulative net profits of Fokai Expressway Co., Ltd in a certain year realized at the end of the year are less than the estimated cumulative net profits of the year, the company will, at the price of 1.0 yuan per share, buy-back the shares calculated in accordance with the agreement for the purpose of compensation and those shares will be written off, and if the amount of compensation exceeds the consideration of those shares being bought-back, Guangdong Provincial Expressway Co., Ltd will compensate that part in cash. At the expiration of the compensation period, if the accumulative actual non-recurring gains and losses (referring to the government’s compensation to Guangdong Provincial Fokai Expressway Co., Ltd due to the cancellation of toll charge of Jiujiang bridge, hereinafter shortly named as “Jiujiang Bridge Compensation”) of Fokai Expressway Co., Ltd were less than the estimated accumulative non-recurring gains and losses, Guangdong Provincial Expressway Co., Ltd will, upon the basis of the stake proportion held by Fokai Expressway Co., Ltd before the major asset restructuring, compensate in cash to the company in accordance with the agreement; If it is after the expiration of the compensation period, every time when Fokai Expressway Co., Ltd received Jiujiang Bridge Compensation, the company should refund the corresponding part which had been paid by Guangdong Provincial Expressway Co., Ltd for the compensation in accordance with the agreement to Guangdong Provincial Expressway Co., Ltd within 30 working days started from the date Fokai Expressway Co., Ltd received such compensation. Agreed by the company and Guangdong Provincial Highway Construction Co., Ltd, the profits of Guangzhou Guangzhu Traffic Investment Management Co., Ltd in year-2016, year-2017 and year-2018 by estimation shall accordingly be 230.3606 million yuan, 263.2329 million yuan and 286.5018 million yuan. During the compensation period, in the case that the cumulative net profits of Guangzhou Guangzhu Traffic Investment Management Co., Ltd realized at the end of the year are less than the estimated cumulative net profits of the year, the company will, at the price of 1.0 yuan per share, buy-back the shares held by Guangdong Provincial Highway Construction Co., Ltd with the quantity being calculated upon the agreement for compensation and those shares will be written off. Guangdong Fokai Expressway Co., Ltd. in 2016 the actual profit (excluding non-) by 286.1655 million yuan, more than the commitment to profit more than 35.4682 million yuan; Guangzhou Guangzhu Traffic Investment Management Co., Ltd. 2016 annual profit of 271.7759 million yuan, More than the commitment to profit more than 41.4153 million yuan. 2017 annual profit of 321.5.34 million yuan, More than the commitment to profit more than 58.2705 million yuan. (4)On April 10, 2018, the company received a letter from the shareholder Yadong Fuxingn Yalian Investment Co., Ltd. On February 8, 2018, Yadong Fuxing Company pledged in batches of the Guangdong Expressway A shares that were previously pledged in the Guotai Junan Securities Co., Ltd, and handled the stock pledge financing agreement of Guangdong Expressway A shares with the China Yinhe Securities Co., Ltd. The 141,600,000 shares held by the Yadong Fuxing Company and accounted for 6.77% of the company's total share capital were pledged to the China Yinhe Securities Co., Ltd for the financing, with the pledge period starting from April 3, 2018. As of the date of approval of report of this financial statement, Yadong Fosun holds 202,429,149 A shares of the Company, accounting for 9.68% of the total share capital of the Company, of which 141,600,000 shares are pledged-accounting for 6.77% of the total share capital of the Company. 166 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 XVII..Notes s of main items in financial reports of parent company 1.Account receivable (1)Account receivable classified by category In RMB Year-end balance Year-beginning Provision for bad Book balance Book balance Provision for bad debts Category debts Book value Book value Proportion Proportion( Proportion( Proportion( Amount Amount Amount Amount (%) %) %) %) Account receivable with single major amount and 18,091,636.66 100.00% 18,091,636.66 19,001,899.29 100.00% 19,001,899.29 withdrawal bad debt provision for single item Total 18,091,636.66 100.00% 18,091,636.66 19,001,899.29 100.00% 19,001,899.29 - Receivable accounts with large amount individually and bad debt provisions were provided √Applicable □Not applicable In RMB Year-end balance Name Bad debt Receivable accounts Proportion Reason provision Guangdong Union Electronic Services Been recovered after the 18,091,636.66 Co., Ltd. period Total 18,091,636.66 -- -- 167 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Account receivable on which bad debt provisions are provided on age basis in the group: □ Applicable √ Not applicable In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision: □ Applicable √ Not applicable In the groups, accounts receivable adopting other methods to accrue bad debt provision:: Nil 168 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (2)Accrual period, recovery or reversal of bad debts situation Nil (3)The current accounts receivable write-offs situation Nil (4)The ending balance of account receivables owed by the imputation of the top five parties Name Amount Aging Proportion(%) Bad debt provision Guangdong Union Electronic Services 18,091,636.66 Within 1 year 100.00 Co., Ltd Total 18,091,636.66 -- 100.00 (5)Account receivable which terminate the recognition owning to the transfer of the financial assets Nil (6)The amount of the assets and liabilities formed by the transfer and the continues involvement of accounts receivable Nil 169 Guangdong Provincial Expressway Development Co.., Ltd. The 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( Book value Proportion Proportion( Book value Amount Proportion(%) Amount Amount Amount %) (%) %) Other Account receivable with single major amount 32,084,893.35 15.67% 32,084,893.35 100.00% 32,084,893.35 82.44% 32,084,893.35 100.00% and withdrawal bad debt provision for single item Other Account receivable withdrawal bad debt 172,707,494.33 84.33% 1,533,987.26 0.89% 171,173,507.07 6,832,189.43 17.56% 1,533,987.26 22.45% 5,298,202.17 provision by group of credit risk characteristics Total 204,792,387.68 100.00% 33,618,880.61 16.42% 171,173,507.07 38,917,082.78 100.00% 33,618,880.61 86.39% 5,298,202.17 Other Receivable accounts with large amount individually and bad debt provisions were provided √Applicable □Not applicable In RMB Balance at year-end Name Other receivable Provision for bad debts Proportion% Reason 170 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Balance at year-end Name Other receivable Provision for bad debts Proportion% Reason For the balance amount of our company’s secutity trading settlement funds 33,683,774.79 yuan deposited in Kunlun Securities Co., Ltd., The Xin’Ning Municipal intermediate People’s Court of Qinghai Province had made the judgment in accordance with the law and declared on November 11, 2006. that Kunlun Securities Co., ltd. was bankrupted for debt payment . In March of 2007, the liquidating group of Kunlun Securities preliminary judged the relationship between our company and Kunlun Securities Co., Ltd.is debtor creditor Kunlun Securities Co., relationship . as Kunlun Securities Co., Ltd.was bankrupted for debt payment and it 32,084,893.35 32,084,893.35 100.00% Ltd. is in serious insolvency. Our company had moved the security trading settlement funds deposited in Kunlun Securities Co., Ltd, to other receivables account for reflection, we also have made full amount provision for had debts based on conservatism principle. The recovered debt amount in 2008 is 485,392.67 yuan which had been offset from the provision for bad debts. The recovered debt amount in 2011 is 667,959.27 yuan which had been offset from the provision for bad, The recovered debt amount in 2014 is 445,529.50 yuan which had been offset from the provision for bad debts.debts. Total 32,084,893.35 32,084,893.35 -- -- 171 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 In the groups, other accounts receivable adopting aging analysis method to withdraw bad debt provision: √Applicable □Not applicable In RMB Balance at year-end Aging Other receivable Provision for bad debts Proportion% Subitem within 1 year Subtotal within 1 year 3,925,741.04 0.00% 1-2 years 10.00% 2-3 years 30.00% 3-4 years 50.00% 4-5 years 90.00% Over 5 years 1,533,987.26 1,533,987.26 100.00% Total 5,459,728.30 1,533,987.26 28.10% Notes In the groups, other accounts receivable adopting balance percentage method to withdraw bad debt provision: □ Applicable √ Not applicable In the groups, other accounts receivable adopting other methods to withdraw bad debt provision: √ Applicable □Not applicable Name Balance at year-end Other receivable Bad debt provision Proportion(%) Reason Guangdong Fokai Expressway Co.,Ltd. 164,829,638.45 Related party transaction Guangdong Litong Real estateInvestment 1,505,864.00 Deposit Co., Ltd. 463,491.88 Related party Guangdong Expressway Co.,Ltd. transaction Beijing CBRE property Management Service 393,331.00 Deposit Co., Ltd. Pengjiang Shunfeng Automobile Leasing Co., 25,500.00 Deposit Ltd. Guangzhou Longfeng Automobile Leasing 20,000.00 Deposit Co., Ltd. Guangdong Gaoda Property Development 9,940.70 Deposit Development Co., Ltd. Total 167,247,766.03 172 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (2)Accrual period, recovery or reversal of bad debts situation The current amount of provision for bad debts is RMB0.00; recovery or payback for bad debts Amount is RMB 0.00. (3) The actual write-off other accounts receivable Nil (4) Other accounts receivable classified by the nature of accounts In RMB Nature Closing book balance Opening book balance Related party transaction 164,829,638.45 Securities trading settlement funds balance 32,084,893.35 32,084,893.35 Guarantee deposit 1,966,383.70 1,929,135.70 Pretty cash 1,555,100.00 1,505,100.00 Advertising and service fee 203,044.13 203,133.13 Other 4,153,328.05 3,194,820.60 Total 204,792,387.68 38,917,082.78 (5)The top five other account receivable classified by debtor at period end In RMB Closing balance of Name Nature Closing balance Aging Proportion% bad debt provision Guangdong Fokai Current account 164,829,638.45 Within 1 year 80.49% Expressway Co., Ltd. Kunlun Securities Securities trading se 32,084,893.35 Over 5 years 15.67% 32,084,893.35 Co.,Ltd ttlement funds Guangdong Litong Real 1-2 years, Over 5 Deposit 1,505,864.00 0.74% estateInvestment years Co., Ltd. Heshan Communication Real Current account 1,470,000.00 Over 5 years 0.72% 1,470,000.00 estate Development Company Guangdong Within 1 year, ,2-3 Current account 466,697.78 0.23% Expressway Co.,Ltd. years Total -- 200,357,093.58 -- 33,554,893.35 173 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (6)Account receivable involving government subsidies Nil (7)Other account receivable derecognized due to the transfer of financial assets Nil (8)Amount of transfer other account receivable and assets and liabilities formed by its continuous involvement. Nil 3. Long- term equity investment In RMB Year-end balance Year-beginning balance Items Bad debt Bad debt Book balance Book value Book balance Book value provision provision Investment to the 5,169,662,219.66 5,169,662,219.66 5,169,662,219.66 5,169,662,219.66 subsidiary Investment to joint ventures and 3,166,390,849.09 3,166,390,849.09 3,047,275,000.00 3,047,275,000.00 associated enterprises Total 8,336,053,068.75 8,336,053,068.75 8,216,937,219.66 8,216,937,219.66 (1)Investment to the subsidiary In RMB Withdrawn Closing balance impairment Name Opening balance Increase Decrease Closing balance of impairment provision in the provision reporting period Guangfo Expressway Co., 154,982,475.25 154,982,475.25 ltd. Guangdong Expressway Technology 95,731,882.42 95,731,882.42 Investment Co., Ltd. Guangdong Fokai 3,635,997,210.85 3,635,997,210.85 Expressway Co., 174 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Ltd. Guangzhou Guangzhu Communication 859,345,204.26 859,345,204.26 Investment Management Co., Ltd. Jingzhu Expressway 419,105,446.88 419,105,446.88 Guangzhu Section Co., Ltd. Yuegao Capital Investment 4,500,000.00 4,500,000.00 (Hengqin) Co., Ltd. Total 5,169,662,219.66 5,169,662,219.66 175 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 (2)Investment to joint ventures and associated enterprises In RMB Increase /decrease in reporting period Closing Adjustment of other Declaration of Withdrawn balance of Name Opening balance Add Decreased Gain/loss of Other equity Closing balance comprehensive cash dividends or impairment Other impairmen investment investment Investment changes income profit provision t provision I. Joint ventures Guangdong Guanghui 949,906,833.96 134,138,087.25 3,951,780.00 37,805,847.20 1,050,190,854.01 Expressway Co., Ltd. ZhaoqingYuezhao 291,906,117.18 28,635,945.38 43,088,859.48 277,453,203.08 Highway Co., Ltd. Subtotal 1,241,812,951.14 162,774,032.63 3,951,780.00 80,894,706.68 1,327,644,057.09 II. Associated enterprises ShenzhenHuiyan Expressway Co., 196,197,198.21 17,813,868.36 214,011,066.57 Ltd. Guangdong Jiangzhong 173,502,304.11 6,897,600.54 3,789,200.79 176,610,703.86 Expressway Co., Ltd. Ganzhou Kangda 208,768,922.86 13,838,738.80 222,607,661.66 Expressway Co., 176 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 Increase /decrease in reporting period Closing Adjustment of other Declaration of Withdrawn balance of Name Opening balance Add Decreased Gain/loss of Other equity Closing balance comprehensive cash dividends or impairment Other impairmen investment investment Investment changes income profit provision t provision Ltd. Ganzhou Gankang Expressway Co., 204,404,703.35 3,050,213.53 207,454,916.88 Ltd. Guangdong Yueke Technology Petty 215,548,332.90 7,397,846.46 222,946,179.36 Loan Co., Ltd. Guoyuan Securities 807,040,587.43 5,004,857.02 -4,983,478.43 -5,404.45 11,940,297.90 795,116,263.67 Co.,Ltd. Subtotal 1,805,462,048.86 54,003,124.71 -4,983,478.43 -5,404.45 15,729,498.69 1,838,746,792.00 Total 3,047,275,000.00 216,777,157.34 -4,983,478.43 3,946,375.55 96,624,205.37 3,166,390,849.09 177 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 4. Business income and Business cost In RMB Amount of current period Amount of previous period Items Revenue Cost Revenue Cost Main business 638,591,636.62 306,898,726.06 Other 37,302,631.12 3,411,961.26 38,224,276.41 232,106.70 Total 675,894,267.74 310,310,687.32 38,224,276.41 232,106.70 Other notes The substantial increase in the main business income of the parent company in the current period is due to the absorption and merger of the Fokai Company and the accounting of the branch business in the parent company since August 1, 2017. 5.Investment income In RMB Items Amount of current period Amount of previous period Long-term equity investment income 621,221,266.51 707,304,426.29 accounted by cost method Long-term equity investment income 216,777,157.34 199,376,107.62 accounted by equity method Investment income received from holding of 42,581,144.86 24,054,256.82 available-for –sale financial assets Total 880,579,568.71 930,734,790.73 XVIII. Supplement information 1. Particulars about current non-recurring gains and loss √ Applicable □Not applicable In RMB Items Amount Notes Gains/losses from the disposal of 44,464,720.82 non-current asset Other non-business income and expenditures 1,075,059.00 other than the above Less :Influenced amount of income tax 11,126,311.84 Amount of influence of minority interests 8,328,932.53 Total 26,084,535.45 -- 178 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 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. □ Applicable √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 8.60% 0.37 0.37 shareholders of the Company Net profit attributable to common shareholders of the Company after 8.31% 0.36 0.36 deduction of non-recurring profit and loss 3. Differences between accounting data under domestic and overseas accounting standards (1) Differences of net profit and net assets disclosed in financial reports prepared under international and Chinese accounting standards □ Applicable √Not applicable (2) Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chinese accounting standards □ Applicable √Not applicable (3) Explain reasons for the differences between accounting data under domestic and overseas accounting standards, for audit data adjusting differences had been foreign audited, should indicate the name of the foreign institutions 4.Other 179 Guangdong Provincial Expressway Development Co.., Ltd. The Semi-Annual Report 2018 XI. Documents Available for Inspection 1. Accounting statements carried with personal signatures and seals of legal representative, General Manager, Chief Financial officer and Financial Principal. 2. Original of Auditors’ Report carried with the seal of Certified Public Accountants as well as personal signatures of certified Public accountants. 3. The texts of all the Company's documents publicly disclosed on the newspapers and periodicals designated by China Securities Regulatory Commission in the report period. 180