Stock Code:000429,200429 Stock Abbreviation :Guangdong Expressway A, Guangdong Expressway B Announcement No.:2019-031 Summary of 2019 Semi-Annual Report of Guangdong Provincial Expressway Development Co., Ltd. 1 Important notes The summary is abstract from full-text of semi-annual report, for more details information , investors should found in the full-text of annual report that published on website of Shenzhen Stock Exchange and other website appointed by CSRC. Director, Supervisor, Senior Manager Objection Statement: None. All the directors have attended the meeting of the board meeting at which this report was examined Non-standard audit advice □ Applicable √ Not applicable The Board of Directors considered the plan for the distribution of ordinary shares in the reporting period or the plan for the transfer of capital reserve. □ Applicable √ Not applicable The company plans not to send cash dividends, do not send bonus shares, not to increase the share capital. The Board of Directors decided to adopt the Preplan Preference Share Profit Distribution Plan for the reporting period □ Applicable √ Not applicable II Company basic information 1. Company Profile Stock abbreviation: Expressway A, Expressway B Stock code: 000429、200429 Stock exchange for listing Shenzhen Stock Exchange 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 E-mail Hmy69@126.com 139221590@qq.com 2. Summary of Accounting data and shareholder change Indicate by tick mark whether the Company needs to retroactively restate any of its accounting data √Yes □ No Retroactive adjustment or restatement of reasons Accounting policy change In RMB Same period of last year YoY+/-(%) Reporting period Before adjustment After adjustment After adjustment Operating income(yuan) 1,483,673,245.21 1,535,864,145.14 1,535,864,145.14 -3.40% Net profit attributable to the shareholders of the listed company 736,486,112.30 779,002,246.98 779,002,246.98 -5.46% (yuan) Net profit after deducting of non-recurring gain/loss attributable to 725,039,035.06 752,917,711.53 752,917,711.53 -3.70% the shareholders of listed company (yuan) Cash flow generated by business 1,050,811,097.23 817,279,588.10 819,779,588.10 28.18% operation, net(yuan) Basic earning per share(yuan/Share) 0.35 0.37 0.37 -5.41% Diluted gains per share(yuan/Share) 0.35 0.37 0.37 -5.41% Weighted average income/asset ratio 7.53% 8.60% 8.60% -1.07% (%) As at the end of As at the end of last year YoY+/-(%) the reporting period Before adjustment After adjustment After adjustment Gross assets(yuan) 16,404,770,149.44 16,295,910,774.45 16,295,910,774.45 0.67% Shareholders’ equity attributable to shareholders of the listed company 9,192,599,494.10 9,586,701,904.06 9,586,701,904.06 -4.11% (yuan) The reasons for the change of Accounting Policy and the Correction of Accounting errors On April 30, 2019, the Notice of the Ministry of Finance on Revising and Issuing the Format of Financial Statements of General Enterprises (No. 6 Finance and Accounting [2019]) issued by the Ministry of Finance indicated that the actual government subsidies received should be listed in the item "cash received from other business activities". In response to such change of accounting policy, the Company adopted the retroactive adjustment method to retroactively adjust the items reported in the financial statements from January to June 2018, affecting the item "net cash flow generated from operating activities" in the above table. 3.Particulars about top ten shareholders In share Total number of common Total number of preferred shareholders that had shareholders at the end of the 56,739 restored the voting right at the end of the 0 reporting period reporting period (if any) (note 8) Particulars about shares held above 5% by shareholders or top ten shareholders Proportion Number of Changes Amount of Amount of Number of Nature of shares held in un-restricte Shareholders of shares restricted share shareholder at period reporting d shares held(%) shares held pledged/frozen -end period held State Amou of nt share Guangdong State-owned Communication 24.56% 513,412,507 410,032,765 10,337,972 legal person Group Co.,Ltd Guangdong Highway State-owned 22.30% 466,325,020 466,325,020 Construction Co., Ltd, legal person Yadong Fuxing Yalian Domestic non Pled 156,65 9.68% 202,429,149 202,429,149 Investment Co., Ltd. State-ow ge 2,500 ned Legal person Tibet Yingyue State-owned Investment 4.84% 101,214,574 101,214,574 legal person Management Co., Ltd. Guangdong State-owned 2.53% 52,937,491 52,937,491 Expressway Co., Ltd. legal person Guangfa Securities State-owned 1.45% 30,364,372 30,364,372 Co., Ltd. legal person Agricultural Bank of China-Jingshun Great Wall Energy Other 1.27% 26,617,103 Infrastructure Mixed Securities Investment Fund China Life Insurance Co., Ltd.-Dividend Other 1.15% 23,965,291 -Personal dividend -005L-FH002 Shen China Life Insurance Co., Ltd.-Traditional -Common insurance Other 1.08% 22,495,445 products-005L-CT001 Shen Domestic Feng Wuchu natural person 0.97% 20,222,807 shares Strategic investor or general legal person becoming top-10 None ordinary shareholder due to rights issue (if any) Related or Guangdong Communication Group Co., Ltd. is the parent company of Guangdong Highway Construction acting-in-concert Co., Ltd. and Guangdong Expressway Co., Ltd., It is unknown whether there is relationship between other parties among shareholders and whether they are persons taking concerted action specified in the Regulations on shareholders above Disclosure of Information about Change in Shareholding of Shareholders of Listed Companies. 4. Change of the controlling shareholder or the actual controller Change of the controlling shareholder in the reporting period □ Applicable √ Not Applicable 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. 5.The total number of shareholders of the Company's preferred shares and the shareholdings of the top 10 preferred shareholders □ Applicable √ Not Applicable The Company did not have any shareholding in the report period. 6. The corporate bonds Whether the company has a public offering and listed on the stock exchange, and in the semi-annual report approved the date of the report did not expire or due to full payment of corporate bonds. no III. Discussion and analysis by the management 1.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 2019, 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 2019, the main business income was 1.484 billion yuan, meaning 46.06% of the annual plan was completed; and the operating costs was 550 million yuan, Flat year-on-year, representing completed 38.68% 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 traffic in Increase Toll income in the first Increase the first half year of 2019 /Decrease(%) half year of 2019(Ten /Decrease(% (Ten thousand vehicles) thousand) Guangfo Expressway 3,537.04 19.74% 23,017.10 2.19% Fokai Expressway 3,421.36 4.26% 61,731.41 -3.33% Jingzhu Expressway 3,483.62 -4.35% 60,184.56 -5.27% Guangzhu East Section Huiyan Expressway 2,008.31 -1.86% 11,728.74 -3.66% Guanghui Expressway 3,082.54 10.73% 90,639.13 4.44% Yuezhao Expressway 1,575.32 8.31% 27,114.74 3.18% Jiangzhong Expressway 2,736.67 6.30% 22,530.61 -1.90% Guangle Expressway 1,247.19 8.28% 155,056.82 1.45% Kangda Expressway 131.96 3.90% 12,001.61 6.16% Gangkang Expressway 216.06 15.40% 8,659.92 12.80% Overall situation: During the reporting period, the increase of Guangfo Expressway traffic volume was higher than that of toll revenue, which was mainly influenced by time-limited goods and distribution of trucks in the surrounding sections; the toll revenue of Fokai Expressway and Guangzhu Section of Jingzhu Expressway showed negative growth year on year, which was mainly influenced by the distributions of the surrounding road network. Guangfo Expressway: From July 1, 2018, a traffic restriction on trucks with more than 15 tons (7:00-22:00) has been imposed in the direction of Guangzhou (Yayao-Hengsha Section) that trucks are guided and the time period of Guangzhou-Foshan Section is adjusted. At the same time, the prohibition on goods was virtually cancelled early in this year in the Foshan First Ring and drivers can drive on the road for free. Thus, the proportion of trucks in Guangfo Section has been declined. However, Guangfo Area featured a intensive transportation of personnel and materials, complete supporting of surrounding buildings, and continuous growth of cars and vehicles. As a consequence, the increase of traffic volume was higher than that of toll revenue. Foai Expressway: The toll revenue declined by 3.33% year on year compared with the first quarter, which was mainly affected by the following factors: on the one hand, the diversion effect of the second phase of Yunzhan Highway was apparent after the opening of the whole line; on the other hand, the tolls of Foshan First Ring Road that was originally planned to open in February were repeatedly postponed, but the entry of vehicles was unrestricted, and the strict control of over-limited and over-load transportation of trucks was not implemented. Guangzhu Section of Jingzhu Expressway: Due to the combination of multiple factors, such as limited cargo in some periods of Humen Bridge, the completion and opening of Nansha Bridge and Panguan Expressway, the traffic volume and toll revenue showed negative growth year-on-year. Gankang Expressway: traffic volume and toll revenue increased by 15.40% and 12.80% respectively year-on-year, and continued to grow on the basis of the first quarter. It is mainly affected by many factors, such as the construction of the surrounding national highway, the overhaul of sand and stone vehicles, and the restriction of the passage of some trucks. Kangda Expressway: In the first half of the year, toll revenue increased by 6.16% year-on-year in the fir st half of this year, which was mainly influenced by the combined influence such as the gradual stabiliz ation of the negative impact of the Dayu Section of the 323 National Highway in 2017 and the stabiliza tion of traffic volume. 2.Matters relating to financial report (1)Explain change of the accounting policy, accounting estimate and measurement methods as compared with the financial reporting of last year. √Applicable□ Not applicable ①Changes in accounting policies resulting from the implementation of the new financial instrument guidelines The Accounting Standards for Enterprises No. 22 - Recognition and Measurement of Financial Instruments (Revised in 2017), the Accounting Standards for Enterprises No. 23 - Transfer of Financial Assets (Revised in 2017), and the Accounting Standards for Enterprises No. 24 - Hedge Accounting Standards for Enterprises (Revised in 2017) (Accounting [2017] No. 9) promulgated by the Ministry of Finance on March 31, 2017, as well as the Accounting Standards for Enterprises No. 37 - Financial Instruments Presentation (Revised in 2017) (Accounting [2017] No. 14) (collectively referred to as "New Financial Instruments Standards") issued on May 2, 2017 requires domestic listed enterprises to implement the new standards from January 1, 2019. Guidelines for financial instruments. Through the resolution of the 25th (provisional) meeting of the eighth board of directors of the Company on April 26, 2019, the Company began to implement the aforementioned new financial instrument guidelines on January 1, 2019. All recognized financial assets under the new financial instrument standards are subsequently measured at the amortized cost or fair value. On the date of implementation of the new financial instrument standards, the business model of managing financial assets is evaluated on the basis of the existing facts and circumstances of the Company on that day, and the characteristics of contractual cash flow on the financial assets are evaluated on the basis of facts and circumstances at the time of initial recognition of financial assets. The financial assets are divided into three categories: measured according to the amortized cost and measured according to the public value. Value is measured and its changes are included in other comprehensive income and fair value, and its changes are included in current profits and losses. Among them, when the financial asset terminates recognition, the accumulated gains or losses previously included in other comprehensive gains will be transferred from other comprehensive gains to retained gains, not into current profits and losses. Under the new financial instrument standards, based on the expected credit loss, the Company makes provision for impairment of financial assets measured by amortized cost, investment in debt instruments measured by fair value and its changes included in other comprehensive gains, lease receivables, contractual assets and financial guarantee contracts, and confirms the loss of credit impairment. The Company retrospectively applies the new financial instrument standards, but for classification and measurement (including impairment) involving the inconsistency between the previous comparative financial statement data and the new financial instrument standards, the Company chooses not to repeat. Therefore, for the cumulative impact of the first implementation of this standard, the Company adjusted the retained earnings or other comprehensive earnings at the beginning of 2019 and the amount of other related items in the financial statements, which were not restated in the financial statements of 2018. The main changes and impacts of the implementation of the new financial instrument guidelines on our Company are as follows: - On January 1, 2019 and beyond, the Company designated some non-tradable equity investments held as financial assets measured at fair value and included their changes in other comprehensive income, and reported them as investments in other equity instruments. - For the long-term equity investment of associates, the Company re-classified and measured the financial instruments according to the new financial instrument standards, and the Company adjusted accordingly according to the equity method. - The Company holds part of the debt instruments, whose cash flow generated on a specific date is only the payment of principal and interest based on the amount of unpaid principal, and the business model of the Company's management of the financial assets is to collect the cash flow of the contract. The Company will take it from other sources on January 1, 2019 and beyond. Non-current assets are reclassified to creditor's rights investment. A. Comparison of financial assets classification and measurement before and after the first implementation date a. Impact on the consolidated financial statements December 31, 2018 (before change) January 1, 2019 (after the change) Items Measurement category Book value Items Measurement category Book value Available-for-sales Measured at fair value 1,668,791,594.53 Investment in Measured at fair value and 1,668,791,594.53 financial assets and included in other other equity included in other comprehensive benefits instruments comprehensive earnings (equity instruments) long-term equity Cost method/equity 3,145,644,970.07 long-term equity Cost method/equity method 3,145,355,906.88 investments method investments b. Impact on the financial statement December 31, 2018 (before change) January 1, 2019 (after the change) Items Measurement Book value Items Measurement category Book value category Available-for-sales Measured at fair 1,668,791,594.53 Investment in Measured at fair value and 1,668,791,594.53 financial assets value and included in other equity included in other other comprehensive instruments comprehensive earnings benefits (equity instruments) long-term equity Cost method/equity 4,679,309,978.88 long-term equity Cost method/equity method 4,679,020,915.69 investments method investments Other non-current amortized cost 692,903,684.98 Creditor's right amortized cost 692,903,684.98 assets investment B. On the first execution date, the book value of the original financial assets shall be adjusted to a new adjustment table for the book value of the financial assets classified and measured in accordance with the provisions of the new financial instrument standards. a. Impact on consolidated statements Items December 31, 2018 Re-measurem January 1,2019 (before change) Re-Class ent (after change) Measured at fair value and included in other comprehensive earnings: Available-for-sale financial assets (original guidelines) 1,668,791,594.53 Less transfer to other creditor's rights investment Less: transfer to other non-current financial assets Less: transfer to other equity instruments 1,668,791,594.53 Balances shown in accordance with the new financial instrument guidelines Investment in other equity instruments Add: transfer from available-for-sale financial assets 1,668,791,594.53 (original criteria) Re-measurement: re-measurement at fair value Balances shown in accordance with the new financial 1,668,791,594.53 instrument guidelines b. Impact on the Company's financial statements Items December 31, 2018 Re-Class Re-measurem January 1,2019 (before change) ent (after change) Amortized cost Other non-current assets (original criteria) 692,903,684.98 Less: transfer to creditor's rights investment 692,903,684.98 Balances shown in accordance with the new financial instrument guidelines Creditor's rights investment Add: transfer from other non-current assets 692,903,684.98 (original criteria) Re-measurement: expected credit loss preparation Balances shown in accordance with the new 692,903,684.98 financial instrument guidelines Measured at fair value and included in other comprehensive earnings: Available-for-sale financial assets (original 1,668,791,594.53 guidelines) Less: transfer to other creditor's rights investment Less: transfer to other non-current financial assets Less: transfer to other equity instruments 1,668,791,594.53 Balances shown in accordance with the new financial instrument guidelines Investment in other equity instruments Add : transfer from available-for-sale financial 1,668,791,594.53 assets (original criteria) Re-measurement: re-measurement at fair value Balances shown in accordance with the new 1,668,791,594.53 financial instrument guidelines C. Financial assets impairment provision adjustment table on the first implementation date a. Impact on consolidated statements Measurement category December 31, 2018 Re-Class Re-measurement January 1, 2019 (before change) (after change) Measured at fair value and included in other comprehensive benefits (debt instruments) Provision for impairment of available-for-sale 37,020,000.00 37,020,000.00 financial assets Investment in other equity instruments 37,020,000.00 37,020,000.00 b. Impact on the Company's financial statements Measurement category December 31, Re-Class Re-measu January 1, 2018 rement 2019 (before change) (after change) Measured at fair value and included in other comprehensive benefits (debt instruments) Provision for impairment of available-for-sale financial assets 7,020,000.00 7,020,000.00 Investment in other equity instruments 7,020,000.00 7,020,000.00 D. Impact on retained earnings and other comprehensive earnings as of January 1, 2019 December 31, 2018 Consolidated retained Consolidated surplus Consolidation of other earnings reserve comprehensive benefits December 31,2018 3,938,609,136.59 245,109,114.81 1. Re-measurement of long-term equity -11,353,413.48 11,064,350.29 investment January 1, 2019 3,927,255,723.11 256,173,465.10 ②Other accounting policy changes E. On April 30, 2019, the Notice of the Ministry of Finance on Revising and Issuing the Format of Financial Statements of General Enterprises (No. 6 Finance and Accounting [2019]) issued by the Ministry of Finance adjusts the format of financial statements of enterprises accordingly, and regulates that the detailed items of "management expenses" and "R&D expenses" should be separated from the items of "management expenses" in the profit statement; it also indicates that the actual government subsidies received should be listed in the item "cash received from other business activities". In response to such change of accounting policy, the Company adopts the retroactive adjustment method to retroactively adjust the items reported in the financial statements from January to June in 2018, as follows: a. Impact on consolidated statements January - June 2018 Before adjustment After Adjustment Change Administrative Fees 75,594,633.97 73,109,460.94 -2,485,173.03 R&D expense 2,485,173.03 2,485,173.03 Other cash receipts relating to operating 39,446,329.98 41,946,329.98 2,500,000.00 activities Receipt of other cash related to fund-raising 2,500,000.00 -2,500,000.00 activities b. Impact on the Company's financial statements January - June 2018 Before adjustment After Adjustment Change Other cash receipts relating to operating 46,329,459.08 48,829,459.08 2,500,000.00 activities Receipt of other cash related to fund-raising 293,500,000.00 291,000,000.00 -2,500,000.00 activities (2)Explain retrospective restatement due to correction of significant accounting errors in the reporting period □Applicable √ Not applicable N/A (3)Explain change of the consolidation scope as compared with the financial reporting of last year. □Applicable √Not applicable There was no change in the scope of the consolidated financial statements during the reporting period.