CSG HOLDING CO., LTD. THE FIRST QUARTER REPORT 2020 Chairman of the Board: CHEN LIN April 2020 CSG HOLDING CO., LTD. The First Quarter Report 2020 Section I Important Notice Board of Directors and the Supervisory Committee of CSG Holding Co., Ltd. (hereinafter referred to as the Company) and its directors, supervisors and senior executives hereby confirm that there are no any fictitious statements, misleading statements, or important omissions carried in this report, and shall take all responsibilities, individual and/or joint, for the facticity, accuracy and completeness of the whole contents. All directors were present at the meeting of the Board for deliberating the First Quarter Report of the Company in person. Ms. Chen Lin, Chairman of the Board, Mr. Wang Jian, responsible person in charge of the accounting and Ms. Wang Wenxin, principal of the financial department (accounting officer) declare that the Financial Report enclosed in the First Quarter Report 2020 is true, accurate and complete. This report is prepared both in Chinese and English. Should there be any inconsistency between the Chinese and English versions, the Chinese version shall prevail. 1 CSG HOLDING CO., LTD. The First Quarter Report 2020 Section II The basic situation of the Company I. Main accounting data and financial indicators Whether the company need to retroactively adjust or restate the previous year's accounting data or not □Yes √ No The 1st quarter of 2020 The 1st quarter of 2019 Percentage of change (%) Operating income (RMB) 1,733,965,637 2,222,721,514 -21.99% Net profit attributable to shareholders of 111,278,288 132,188,324 -15.82% the listed company(RMB) Net profit attributable to shareholders of the listed company after deducting 101,805,077 82,573,767 23.29% non-recurring gains and losses(RMB) Net cash flow arising from operating -11,126,768 136,317,362 -108.16% activities(RMB) note(1) Basic earnings per share (RMB/Share) 0.04 0.04 - Diluted earnings per share (RMB/Share) 0.04 0.04 - Weighted average ROE (%) 1.16% 1.44% -0.28% 31 March 2020 31 December 2019 Percentage of change (%) Total assets (RMB) 20,247,986,997 18,201,235,959 11.25% Net assets attributable to shareholder of 9,608,165,285 9,495,588,878 1.19% listed company(RMB) Note (1):Due to the epidemic, sales revenue reduced. The total share capital of the company as of the previous trading day of disclosure ( share ) 3,106,915,005 Fully diluted earnings per share calculated with latest equity ( RMB/share ) 0.04 Note: The total amount of 1,281,158 shares of restricted stocks held by 18 unqualified original incentives, which had been repurchased but not yet cancelled, were deducted from the total share capital. Items and amounts of extraordinary profit (gains)/losses √Applicable □ Not applicable Unit: RMB Amount from beginning of the year to Item Note the end of the report period Gains/losses from the disposal of non-current asset (including the -494,285 write-off that accrued for impairment of assets) 2 CSG HOLDING CO., LTD. The First Quarter Report 2020 Governmental subsidy reckoned into current gains/losses (not including the subsidy enjoyed in quota or ration according to 20,792,152 national standards, which are closely relevant to enterprise’s business) Loss and profit on external entrusted loan 5,546,383 Other non-operating income and expenditure except for the -16,631,286 aforementioned items Less: Impact on income tax -308,097 Impact on minority shareholders’ equity (post-tax) 47,850 Total 9,473,211 -- For the non-recurring profit and loss items defined by the company in accordance with Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, and the non-recurring profit and loss items listed in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss. are defined as recurring profit and loss items, the reasons shall be explained. □ Applicable √ Not applicable During the report period, the Company didn’t have the case of extraordinary profit (gains)/loss defined as a regular profit and loss project, which was defined and enumerated according to the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss. II. Total of shareholders at the end of the report period and particulars about the shares held by the top ten shareholders 1. The total number of common shareholders and the number of preference shareholders with voting rights recovered as well as the top ten shareholders Unit: Share The total number of common shareholders The total number of preference shareholders with voting 148,844 0 at the end of the report period rights recovered at end of report period (if applicable) Particulars about the shares held by the top ten shareholders Number of share Proportion Amount of Amount of pledged/frozen Name of shareholder Nature of shareholder of shares restricted shares held Share held (%) shares held Amount status Foresea Life Insurance Co., Ltd. – Domestic non state-owned 15.01% 466,386,874 Hailiniannian legal person Foresea Life Insurance Co., Ltd. – Domestic non state-owned 3.81% 118,425,007 Universal Insurance Products legal person Domestic non state-owned Zhongshanruntian Investment Co., Ltd. 2.79% 86,633,447 pledged 81,000,000 legal person Foresea Life Insurance Co., Ltd. – Own Domestic non state-owned 2.08% 64,765,161 3 CSG HOLDING CO., LTD. The First Quarter Report 2020 Fund legal person Central Huijin Asset Management Ltd. State-owned legal person 1.86% 57,915,488 Hong Kong Securities Clearing Co., Ltd. Foreign legal person 1.80% 56,039,290 China Galaxy International Securities Foreign legal person 1.33% 41,399,778 (Hong Kong) Co., Limited China Merchants Securities (HK) Co., State-owned legal person 1.05% 32,486,067 Limited Shenzhen International Holdings (SZ) State-owned legal person 0.94% 29,095,000 Limited VANGUARD EMERGING MARKETS Foreign legal person 0.62% 19,320,233 STOCK INDEX FUND Particulars about the top ten shareholders with un-restrict shares held Amount of unrestricted Type of shares Shareholders’ name shares held at the end of Type Amount the period Foresea Life Insurance Co., Ltd. – Hailiniannian 466,386,874 RMB ordinary shares 466,386,874 Foresea Life Insurance Co., Ltd. – Universal Insurance Products 118,425,007 RMB ordinary shares 118,425,007 Zhongshanruntian Investment Co., Ltd. 86,633,447 RMB ordinary shares 86,633,447 Foresea Life Insurance Co., Ltd. – Own Fund 64,765,161 RMB ordinary shares 64,765,161 Central Huijin Asset Management Ltd. 57,915,488 RMB ordinary shares 57,915,488 Hong Kong Securities Clearing Co., Ltd. 56,039,290 RMB ordinary shares 56,039,290 Domestically listed China Galaxy International Securities (Hong Kong) Co., Limited 41,399,778 41,399,778 foreign shares Domestically listed China Merchants Securities (HK) Co., Limited 32,486,067 32,486,067 foreign shares Shenzhen International Holdings (SZ) Limited 29,095,000 RMB ordinary shares 29,095,000 Domestically listed VANGUARD EMERGING MARKETS STOCK INDEX FUND 19,320,233 19,320,233 foreign shares Among shareholders as listed above, Foresea Life Insurance Co., Ltd.-HailiNiannian, Foresea Life Insurance Co., Ltd.-Universal Insurance Products, Foresea Life Insurance Co., Ltd.-Own Fund are all held by Foresea Life Insurance Co., Ltd. Zhongshanruntian Investment Co., Ltd. Statement on associated relationship is a related legal person of Foresea Life Insurance Co., Ltd. and Chengtai Group Co., Ltd., or consistent action among the another related legal person of Foresea Life Insurance Co., Ltd, which held 40,187,904 shares above shareholders: via China Galaxy International Securities (Hong Kong) Co., Limited. Except for the above-mentioned shareholders, it is unknown whether other shareholders belong to related party or have associated relationship regulated by the Management Regulation of Information Disclosure on Change of Shareholding for Listed Companies. Explanation on the top ten N/A 4 CSG HOLDING CO., LTD. The First Quarter Report 2020 shareholders with un-restrict shares held which involving margin business (if applicable) Whether the top ten common shareholders or the top ten common shareholders holding unrestricted shares had a buy-back agreement dealing in the report period or not. □ Yes √ No The top ten common shareholders or the top ten common shareholders holding unrestricted shares of the Company had no buy-back agreement dealing in the report period. 2. The total number of preferred shareholders of the company and particulars about the top ten preferred shareholders □ Applicable √ Not applicable 5 CSG HOLDING CO., LTD. The First Quarter Report 2020 Section III Important events I. Particulars and explanations about significant changes in main accounting statements and financial indices √Applicable □Not applicable Unit: RMB 0,000 Amount of Percentage Note 31 March 2020 31 December 2019 change of change Monetary Fund (1) 384,623 198,698 185,925 94% Notes receivable (2) 14,042 29,702 -15,660 -53% Advance payment (3) 11,448 7,820 3,628 46% Inventories (4) 121,176 81,232 39,944 49% Other current assets (5) 15,540 44,800 -29,260 -65% Construction in progress (6) 252,242 190,214 62,028 33% Advance from customers (7) - 29,280 -29,280 -100% Contract liability (8) 28,951 - 28,951 - Payroll payable (9) 16,391 33,787 -17,396 -51% Taxes payable (10) 7,855 11,543 -3,688 -32% Amount of Percentage Note Jan.-Mar.2020 Jan.-Mar.2019 change of change Credit impairment loss (11) 376 682 -306 -45% Income from asset disposal (12) -49 688 -737 -107% Other income (13) 2,079 4,746 -2,667 -56% Non-operating expenses (14) 1,722 142 1,580 1113% Minority shareholder gains and losses (15) 71 375 -304 -81% Other comprehensive income (16) 149 -122 271 Notes: (1) The increase in monetary fund was mainly due to the increase in cash received from the company's bonds issued in the current period. (2) The decrease in notes receivable was mainly due to the collection and use of notes at maturity. (3)The increase in advance payment was mainly due to the increase of prepayment materials. (4) The increase in inventories was mainly due to the decrease in shipments affected by the outbreak. (5) The decrease in other current assets was mainly due to the collection of entrusted loans in the current period. (6) The increase in construction in progress was mainly due to transfer of fixed assets of some subsidiaries to the technical renovation 6 CSG HOLDING CO., LTD. The First Quarter Report 2020 of construction in process. (7) The decrease in advance from customers was mainly due to the reclassification of advance from customers and contract liabilities according to the new revenue criteria. (8) The increase in contract liability was mainly due to the reclassification of advance payment and contract liability according to the new revenue criterion. (9) The decrease in payroll payable was mainly due to the payment of year-end bonus at the end of last year. (10) The decrease in taxes payable was mainly due to the tax paid for the end of the previous reporting period. (11) The decrease in credit impairment loss was mainly due to the reduction of accounts receivable bad debt provision. (12) The decrease in income from asset disposal was mainly due to the disposal of assets held for sale in the previous period. (13) The decrease in other income was mainly due to the reduction of the amortization of current government subsidies. (14) The increase in non-operating expenses was mainly due to the increase of donation expenses during the epidemic. (15) The decrease in profit and loss of minority shareholders was mainly due to the decrease in the net profit of the subsidiary with minority shareholders. (16) The increase in other comprehensive income was mainly due to the translation difference of foreign currency statements. II. The progress and the impact of material events and analysis on the solutions √Applicable □Not applicable 1. Ultra-short-term financing bills On May 14, 2018, the Company’s 2017 annual shareholders’ meeting deliberated and approved the resolution on the application for registration and issuance of ultra-short-term financing bills, which agreed that the Company should register and issue ultra-short-term financing bills with a registered amount not exceeding 4 billion yuan (not subject to the restriction that the amount of ultra-short-erm issued shall not exceed 40% of net assets). With the period of validity of the quota not longer than two years, such ultra-short-term financing bills will be issued by installments in accordance with the actual capital needs of the Company and the situation of inter-bank market funds. On Sep. 17, 2018, the Chinese Association of Interbank Market Traders held its 63rd registration meeting in 2018, and decided to approve the registration of the ultra-short-term financing bills with a total amount of 1.5 billion yuan and a validity period of two years. The ultra-short-term financing bills are underwritten jointly by Minsheng Bank of China Limited and Industrial Bank Co., Ltd, and can be issued by installments within the validity period of registration. On February 21, 2020, the company issued ultra-short-term financing bonds with a total amount of 300 million yuan and a term of 270 days in the first phase of 2020, with an interest rate of 4% and a payment date of November 21, 2020. 2. Medium-term notes On 10 December 2014, the First Extraordinary Shareholders’ General Meeting 2014 of CSG Holding Co., Ltd deliberated and approved the proposal of application for registration and issuance of medium-term notes with a total amount of RMB 1.2 billion at most. On 21 May 2015, National Association of Financial Market Institutional Investors (NAFMII) held the 32nd registration meeting of 2015, in which NAFMII decided to accept the registration of the Company’s medium-term notes, amounting to RMB 1.2 billion and valid for two years. China Merchants Bank Co., Ltd. and Shanghai Pudong Development Bank Co., Ltd. were joint lead underwriters of these medium-term notes which could be issued by stages within period of validity of the registration onJul.14, 2015, the Company issued the first phase of medium-term notes with a total amount of RMB 1.2 billion and valid term of 5 years at the issuance rate of 4.94%, which will be redeemed on 14 July 2020. On April 15, 2016, the Shareholders’ General Meeting of 2015 of CSG deliberated and approved the proposal of application for registration and issuance of medium-term notes with a total amount of RMB 0.8 billion, which could be issued by stages within period of validity of the registration according to the Company’s actual demands for funds and the status of inter-bank funds. On 2 7 CSG HOLDING CO., LTD. The First Quarter Report 2020 March 2018, National Association of Financial Market Institutional Investors (NAFMII) held the 14th registration meeting of 2018, in which NAFMII decided to accept the registration of the Company’s medium-term notes, amounting to RMB 0.8 billion and valid for two years. Shanghai Pudong Development Bank Co., Ltd. and China CITIC Bank Corporation Limited were joint lead underwriters of these medium-term notes which could be issued by stages within period of validity of the registration. On May 4, 2018, the Company issued the first phase of medium-term notes with a total amount of RMB 0.8 billion and valid term of three years at the issuance rate of 7%, which will be redeemed on May 4, 2021. For details, please refer to www.chinabond.com.cn and www.chinamoney.com.cn. 3. Public issuance of corporate bonds On March 2, 2017, the 2nd Extraordinary General Meeting of Shareholders of 2017 deliberated and approved “the Proposal on the Public Issuance of Corporate Bonds for Qualified Investors". On February 27, 2019, the First Extraordinary General Meeting of Shareholders of 2019 deliberated and approved “the Proposal on Extending the Validity of the Shareholders' Meeting Resolution for the Public Issuance of Corporate Bonds for Qualified Investors”, and agreed the Company to issue corporate bonds with a total issue of no more than RMB 2 billion and a term of no more than 10 years. On July 22, 2019, the Company received the Reply on Approving the Public Issuance of Corporate Bonds by CSG Holding Co., Ltd. to Qualified Investors (ZHJXK[2019] No. 1140) issued by China Securities Regulatory Commission. From Mar. 24, 2020 to Mar. 25, 2020, the Company issued the first phase of corporate bonds with a total amount of RMB 2.00 billion and valid term of three years at the issuance rate of 6% ,which will be redeemed on Mar. 25, 2023. On March 12, 2020, the 1st Extraordinary General Meeting of Shareholders of 2020 deliberated and approved “the Proposal on the Public Issuance of Corporate Bonds to Qualified Investors”, and agreed the Company to issue corporate bonds with a total issue of no more than RMB 1.8 billion and a term of no more than 10 years. 4. The interim meeting of the 8th board of directors of the Company held on Dec. 20, 2019 approved the resolution that the Company would issue RMB 300.00 million entrusted loans to TengchongYuezhou Water Investment and Development Co., Ltd, with valid term of three months and annual interest rate at 8.5%. By Mar. 24, 2020, the principal and income of the entrusted loan had been recovered as agreed in contract. 5. Non-public issuance of A shares The interim meeting of the 8th board of directors of the Company held on Mar. 5, 2020 deliberated and approved the related proposals of non-public issuance of A shares, and agreed the Company to issue A shares privately. The proposals were deliberated and approved by the 2nd Extraordinary General Meeting of Shareholders of 2020 which held on April 16, 2020. For details, please refer to the relevant contents published on juchao information network (www.cninfo.com.cn) on March 6 and April 17, 2020. Progress of implementation of share repurchase □Applicable √Not applicable Progress of implementation of the reduction of there purchased shares by means of centralized price bidding □Applicable √Not applicable 8 CSG HOLDING CO., LTD. The First Quarter Report 2020 III. Failure in due fulfillment of commitments of the actual controllers, shareholders, affiliates, and acquirers of listed company as well as the listed company during the report period □Applicable √Not applicable It did not exist that commitments of the actual controllers, shareholders, affiliates, and acquirers of listed company as well as the listed company failed to be fulfilled on time during the report period. IV. Predict of the business performance from January to June 2020 Warnings and reasons of the predict that the cumulative net profit from the begin of the year to the end of next report period may be loss or have great changes comparing with the same period of last year □Applicable √Not applicable V. Securities investment □ Applicable √ Not applicable There was no securities investment during the report period. VI. Entrusted Financing □ Applicable √ Not applicable There was no Entrusted Financing during the report period VII. Derivative investment □ Applicable √ Not applicable There was no derivative investment during the report period. VIII. Registration form for receiving research, communication and interview during the report period □ Applicable √ Not applicable The Company did not receive any research, communication or interviews during the report period. IX. Particulars about illegal external guarantee □ Applicable √Not applicable The Company had no illegal external guarantee during the report period. X. Particulars about non-operating fund of listed company which is occupied by controlling shareholder and its affiliated enterprises □ Applicable √ Not applicable There’s no non-operating fund of listed company occupied by controlling shareholder and its affiliated enterprises during the report period. 9 CSG HOLDING CO., LTD. The First Quarter Report 2020 Section IV Financial Report I. Financial Statements 1. Consolidated balance sheet Prepared by CSG Holding Co., Ltd. Unit: RMB Item 2020-3-31 2019-12-31 Current asset: Monetary Fund 3,846,233,991 1,986,980,418 Notes receivable 140,418,023 297,023,380 Accounts receivable 823,778,059 649,681,177 Receivables financing 285,058,513 258,296,826 Prepayments 114,478,403 78,196,027 Other receivables 211,774,103 202,854,864 Inventories 1,211,763,346 812,321,690 Other current assets 155,404,297 447,995,931 Total current assets 6,788,908,735 4,733,350,313 Non-current assets: Fixed assets 9,068,360,284 9,783,037,301 Construction in progress 2,522,416,100 1,902,140,035 Intangible assets 1,118,306,095 1,044,826,287 Development expenditure 97,761,017 85,240,356 Goodwill 315,097,756 315,097,756 Long-term prepaid expenses 10,973,411 11,351,431 Deferred tax assets 210,292,966 205,792,587 Other non-current assets 115,870,633 120,399,893 Total non-current assets 13,459,078,262 13,467,885,646 Total assets 20,247,986,997 18,201,235,959 Current liabilities: Short-term loan 2,289,050,367 2,240,969,137 Notes payable 171,724,911 232,063,968 Accounts payable 1,280,281,135 1,100,531,779 10 CSG HOLDING CO., LTD. The First Quarter Report 2020 Advance from customers 292,803,811 Contract liability 289,510,630 Payroll pay 163,913,820 337,866,246 Taxes payable 78,552,174 115,425,044 Other payables 378,107,241 351,374,775 Incl.: Interest payable 102,902,279 73,251,086 Dividend payable 2,985,563 2,985,563 Non-current liabilities due within one year 1,544,734,218 1,712,456,928 Other current liabilities 300,000 300,000 Total current liabilities 6,196,174,496 6,383,791,688 Non-current liabilities: Long term loan 1,471,322,500 1,320,225,000 Bonds payable 1,991,303,521 Long-term payables 70,233,958 87,240,529 Deferred income 507,674,359 513,925,557 Deferred income tax liabilities 32,135,757 30,197,657 Total non-current liabilities 4,072,670,095 1,951,588,743 Total Liabilities 10,268,844,591 8,335,380,431 Owners' equity: Share capital 3,106,915,005 3,106,915,005 Capital reserve 683,219,358 683,219,358 Less: treasury shares 118,066,397 118,066,397 Other comprehensive income 8,058,407 6,565,864 Special reserves 10,908,497 11,102,921 Surplus reserve 946,251,286 946,251,286 Undistributed profits 4,970,879,129 4,859,600,841 Total owner's equity attributable to the parent 9,608,165,285 9,495,588,878 company Minority shareholders' equity 370,977,121 370,266,650 Total owner's equity 9,979,142,406 9,865,855,528 Total Liabilities and Owner's Equity 20,247,986,997 18,201,235,959 Legal Representative:Chen LinResponsible person in charge of the accounting: Wang Jian Principal of the financial department: Wang Wenxin 11 CSG HOLDING CO., LTD. The First Quarter Report 2020 2. Balance Sheet of the Parent Company Unit: RMB Item Ending balance Beginning balance Current asset: Monetary Fund 3,441,903,352 1,560,798,731 Prepayments 1,580,018 1,799,222 Other receivables 3,568,793,050 3,179,500,967 Other current assets 102,916 300,000,000 Total current assets 7,012,379,336 5,042,098,920 Non-current assets: Long-term receivables 1,200,000,000 1,200,000,000 Long-term equity investment 5,160,865,574 5,079,465,574 Fixed assets 18,235,043 19,550,442 Intangible assets 274,696 370,484 Other non-current assets 12,036,106 1,407,535 Total non-current assets 6,391,411,419 6,300,794,035 Total assets 13,403,790,755 11,342,892,955 Current liabilities: Short-term loan 1,713,000,000 1,687,000,000 Notes payable 20,000,000 170,000,000 Payables 236,346 236,346 Payroll payable 6,796,262 53,040,982 Taxes payable 150,096 2,901,358 Other payables 1,747,238,244 1,643,156,452 Incl.: Interest payable 58,978,240 41,186,139 Dividend payable 2,985,563 2,985,563 Non-current liabilities due within one year 1,200,000,000 1,200,000,000 Total current liabilities 4,687,420,948 4,756,335,138 Non-current liabilities: Long term loan 1,300,000,000 1,130,000,000 Bonds payable 1,991,303,521 Deferred income 181,782,265 182,386,537 Total non-current liabilities 3,473,085,786 1,312,386,537 Total Liabilities 8,160,506,734 6,068,721,675 12 CSG HOLDING CO., LTD. The First Quarter Report 2020 Owners' equity: Share capital 3,106,915,005 3,106,915,005 Capital reserve 828,046,672 828,046,672 Less: treasury shares 118,066,397 118,066,397 Surplus reserve 960,796,646 960,796,646 Undistributed profits 465,592,095 496,479,354 Total owner's equity 5,243,284,021 5,274,171,280 Total Liabilities and Owner's Equity 13,403,790,755 11,342,892,955 3. Consolidated Income Statement Unit: RMB Item Balance of this period Balance of last period I. Totaloperating revenue 1,733,965,637 2,222,721,514 Incl. :Business income 1,733,965,637 2,222,721,514 II. Total business cost 1,598,409,180 2,105,465,980 Incl. :Business cost 1,223,133,015 1,710,257,358 Taxes and surcharges 21,811,789 26,974,283 Sales expense 68,190,292 82,460,250 Management costs 154,294,998 123,978,598 Research and development expenses 72,997,585 79,671,948 Financial expenses 57,981,501 82,123,543 Incl. : Interest expense 67,258,381 87,627,795 Interest income 11,556,400 6,719,497 Plus: Other income 20,792,152 47,460,637 Credit impairment loss (“-“ for loss) -3,756,132 -6,824,404 Asset disposal income(“-“ for loss) -494,285 6,877,195 III. Operational profit (“-“ for loss) 152,098,192 164,768,962 Plus: non-operational income 585,906 687,874 Less: non-operationalexpenses 17,217,192 1,424,258 IV. Gross profit (“-“ for loss) 135,466,906 164,032,578 Less: Income tax expenses 23,478,147 28,094,174 V. Net profit (“-“ for net loss) 111,988,759 135,938,404 (I) Classification by business continuity 1. Net profit from continuous operation(“-“ for net 111,988,759 135,938,404 13 CSG HOLDING CO., LTD. The First Quarter Report 2020 loss) 2. Discontinued operating net profit(“-“ for net loss) (II) Classification by ownership 1. Net profit attributable to the owners of parent 111,278,288 132,188,324 company 2. Minor shareholders’ equity 710,471 3,750,080 VI. Net after-tax amount of other comprehensive income 1,492,543 -1,221,913 Net after-tax amount of other comprehensive income 1,492,543 -1,221,913 attributable to the owner of the parent company Other comprehensive income that will be reclassified 1,492,543 -1,221,913 into profit or loss Foreign-currency financial statement translation difference 1,492,543 -1,221,913 VII.Total comprehensive income 113,481,302 134,716,491 Total comprehensive income attributable to owners of 112,770,831 130,966,411 the Company Total comprehensive income attributable to minority 710,471 3,750,080 shareholders VIII. Earnings per share (I) Basic earnings per share 0.04 0.04 (II) Diluted earnings per share 0.04 0.04 Legal Representative:Chen LinResponsible person in charge of the accounting: Wang Jian Principal of the financial department: Wang Wenxin 4. Income Statement of the Parent Company Unit: RMB Item Balance of this period Balance of last period I. Operating revenue 19,233,446 20,108,542 Less: Business cost Taxes and surcharges 20,006 220,610 Sales expense Management costs 19,879,935 22,307,483 Research and development expenses 4,617 8,833 Financial expenses 29,286,644 31,366,290 Incl. : Interest expense 39,873,739 36,970,255 Interest income 10,724,357 5,862,210 14 CSG HOLDING CO., LTD. The First Quarter Report 2020 Plus: Other income 735,596 678,275 Credit impairment loss (“-“ for loss) -123,501 3,481 II. Operational profit (“-“ for loss) -29,345,661 -33,112,918 Plus: non-operational income 76,152 Less: non-operational expenses 1,617,750 III.. Gross profit (“-“ for loss) -30,887,259 -33,112,918 Less: Income tax expenses IV. Net profit (“-“ for net loss) -30,887,259 -33,112,918 (I) Net profit from continuous operation(“-“ for net -30,887,259 -33,112,918 loss) (II) Discontinued operating net profit(“-“ for net loss) V. Total comprehensive income -30,887,259 -33,112,918 VI. Earnings per share (I) Basic earnings per share (II) Diluted earnings per share 5. Consolidated Cash Flow Statement Unit: RMB Item Balance of this period Balance of last period I. Net cash flow from business operation: Cash received from sales of products and providing of 1,783,332,428 2,268,333,166 services Refunds of taxes 1,032,626 1,825,553 Received other cash related to business activities 34,722,910 26,891,640 Subtotal of cash inflow from operating activities 1,819,087,964 2,297,050,359 Cash paid for the purchase of goods and services 1,145,407,582 1,445,370,845 Cash paid to and for employees 424,877,941 418,315,107 Payments of all types of taxes 133,051,857 138,793,875 Payment of other cash related to business activities 126,877,352 158,253,170 Subtotal of cash outflow from operating activities 1,830,214,732 2,160,732,997 Net cash flow from operating activities -11,126,768 136,317,362 II. Cash flows from investing activities: Net cash recovered from disposal of fixed assets, 520,508 334,400 intangible assets and other long-term assets Other cash received relating to investing activities 321,068,423 209,085 15 CSG HOLDING CO., LTD. The First Quarter Report 2020 Subtotal of cash inflows from investment activities 321,588,931 543,485 Cash paid for the purchase and construction of fixed 246,551,903 127,234,513 assets, intangible assets and other long-term assets Other cash paid relating to investing activities 15,432,851 606,824 Subtotal of cash outflows from investment activities 261,984,754 127,841,337 Net cash flows from investing activities 59,604,177 -127,297,852 III.Cash flow from financing activities: Cash received from the loan 1,114,359,186 835,500,000 Cash received from the issuance of bonds 2,000,000,000 Other financing-related cash received 904,849 500,000,000 Subtotal of cash inflows from financing activities 3,115,264,035 1,335,500,000 Cash paid for debt repayment 917,657,084 930,211,970 Cash paid for dividends, profits or interest payments 40,226,280 62,397,350 Payment of other cash related to financing activities 197,505,852 359,331,565 Subtotal of cash outflows from financing activities 1,155,389,216 1,351,940,885 Net cash flow from financing activities 1,959,874,819 -16,440,885 IV. Influence of exchange rate alternation on cash and cash 759,216 -1,620,779 equivalents V.Net increase in cash and cash equivalents 2,009,111,444 -9,042,154 Plus: Balance of cash and cash equivalents at the 1,831,835,030 2,225,126,913 beginning of term VI. Balance of cash and cash equivalents at the end of term 3,840,946,474 2,216,084,759 6. Cash Flow Statement of the Parent Company Unit: RMB Item Balance of this period Balance of last period I. Net cash flow from business operation: Cash received from sales of products and providing of services Refunds of taxes 18,321 Received other cash related to business activities 17,504,825 12,431,042 Subtotal of cash inflow from operating activities 17,523,146 12,431,042 Cash paid for the purchase of goods and services Cash paid to and for employees 65,197,531 51,404,986 Payments of all types of taxes 6,802,435 1,047,643 16 CSG HOLDING CO., LTD. The First Quarter Report 2020 Payment of other cash related to business activities 5,566,108 8,308,180 Subtotal of cash outflow from operating activities 77,566,074 60,760,809 Net cash flow from operating activities -60,042,928 -48,329,767 II. Cash flows from investing activities: Other cash received relating to investing activities 300,000,000 Subtotal of cash inflows from investment activities 300,000,000 Cash paid for the purchase and construction of fixed 9,586,096 1,522,855 assets, intangible assets and other long-term assets Cash for investment payments 81,400,000 Subtotal of cash outflows from investment activities 90,986,096 1,522,855 Net cash flows from investing activities 209,013,904 -1,522,855 III. Cash flow from financing activities: Cash received from the loan 827,549,801 700,000,000 Cash received from the issuance of bonds 2,000,000,000 Other financing-related cash received Subtotal of cash inflows from financing activities 2,827,549,801 700,000,000 Cash paid for debt repayment 631,999,801 650,000,000 Cash paid for dividends, profits or interest payments 22,458,117 22,874,958 Payment of other cash related to financing activities 290,614,929 670,685,645 Subtotal of cash outflows from financing activities 945,072,847 1,343,560,603 Net cash flow from financing activities 1,882,476,954 -643,560,603 IV. Influence of exchange rate alternation on cash and cash 14,917 -17,160 equivalents V. Net increase in cash and cash equivalents 2,031,462,847 -693,430,385 Plus: Balance of cash and cash equivalents at the 1,407,215,863 1,699,514,334 beginning of term VI. Balance of cash and cash equivalents at the end of term 3,438,678,710 1,006,083,949 II. Note to the Adjustment of Financial Statements Since 2020, adjustment of the relevant financial statements at current year beginning according to new standards for the new standards for revenues and the new standards for lease initially implemented √Applicable □Not applicable Item 2019-12-31 2020-01-01 adjust data Advance from customers 292,803,811 -292,803,811 17 CSG HOLDING CO., LTD. The First Quarter Report 2020 Contract liability 292,803,811 292,803,811 Note: the finance ministry issued Accounting Standard For Business Enterprises no. 14 - revenue in July 2017. In accordance with the relevant provisions, enterprises that are listed both in domestic and abroad and enterprises that are listed abroad and prepare financial statements by adopting international financial reporting standards or accounting standards for business enterprises shall come into force as of January 1, 2018; Other domestic listed enterprises shall take effect as of January 1, 2020. In accordance with the above provisions, the company shall implement the newly issued revenue criterion from January 1, 2020, and the payment for the original advance sales contract shall be reported in the "Advance fromcustomers", and the payment shall be reported in the "contract liability" from January 1, 2020. 2. Since 2020, note to the retroactive adjustment of the previous comparative data according to the new standards for revenues and the new standards for lease initially implemented □ Applicable √Not applicable III. Report of the Auditors Whether the First Quarter Report has been audited or not □ Yes √ No The First Quarter Report hasn’t been audited. Board of Directors of CSG Holding Co., Ltd. 30 April 2020 18