China Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 1 China Merchants Property Development Co., Ltd. The Third Quarterly Report For 2009 (Full Text) §1. Important Notes 1.1 Board of Directors and the Supervisory Committee of China Merchants Property Development Co., Ltd. (hereinafter referred to as the Company) and its directors, supervisors and senior executives hereby confirm that there are no any fictitious statements, misleading statements, or important omissions carried in this report, and shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of the whole contents. 1.2 The Third Quarterly Financial Report of 2009 has not been audited by CPAs. 1.3 Sun Chengming – Legal Representative the Company, Huang Peikun –CFO, and Xu Yixia –Manager of Financial Department hereby confirm that the Financial Report of the Third Quarterly Report is true and complete. 1.4 This report has been prepared in Chinese and English version respectively. In the event of differences in interpretation between the two versions, the Chinese report shall prevail. §2. Company Profile 2.1 Main accounting highlights and financial indexes: Unit: RMB Sep. 30, 2009 Dec. 31, 2008 Increase/decrease scope (%) Total assets 42,449,156,659.00 37,437,014,995.00 13.39% Owners’ equities attributable to the shareholders of listed company 15,653,580,062.00 14,862,746,365.00 5.32% Share capital (Share) 1,717,300,503.00 1,717,300,503.00 0.00% Net assets per share attributable to the shareholders of listed company (RMB/Share) 9.12 8.65 5.43% July-Sep. 2009 Increase/decrease over the same period of the last year (%) Jan.-Sep. 2009 Increase/decrease over the same period of the last year (%) Total operating income 2,411,599,990.0 0 419.90% 5,287,377,216.0 0 176.71% Net profit attributable to the shareholders of listed company 474,075,608.00 178.98% 960,923,356.00 147.24% Net cash flow arising from operating activities - - 5,152,035,316.0 0 284.82% Net cash flow arising from operating activities per share (RMB/Share) - - 3.00 236.38% Basic earnings per share (RMB/Share) 0.276 82.78% 0.560 62.32% Diluted earnings per share (RMB/Share) 0.276 82.78% 0.560 62.32%China Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 2 Return on equity (%) 3.08% 48.79% 6.31% 33.40% Return on equity after deducting non-recurring gains and losses (%) 3.08% 47.37% 6.25% 25.50% Unit: RMB Items of non-recurring gains and losses Amount from year begin to the end of report period Remarks Gains and losses from the disposal of non-current asset -284,485.00 Governmental subsidy calculated into current gains and losses, while closely related with the business of the Company, excluding the fixed-amount or fixed-proportion governmental subsidy according to the unified national standard 1,274,727.00 Withdrawal of provisions for assets impairment due to factor of force majeure such as natural disaster 113,042.00 Other non-operating income and expenditure beside for the aforementioned items 8,114,931.00 Impact on income tax -719,319.00 Influenced amount of minority shareholders’ equity -21,394.00 Total 8,477,502.00 - 2.2 Total number of shareholders at the end of the report period and shares held by the top ten shareholders with unrestricted conditions Unit: Share Total number of shareholders at the end of report period 71,985 Particulars about the shares held by the top ten shareholders with unrestricted conditions Full Name of shareholder Unrestricted shares held Type of shares China Pacific Insurance (Group) Co., Ltd.- Bonus-Individual bonus 25,509,415 RMB common share Changsheng Tongde Theme Growth Stock Fund 19,109,486 RMB common share China Pacific Insurance (Group) Co., Ltd.- Traditional-General Insurance Products 13,867,567 RMB common share Penghua Outstanding Corporate Governance Stock Fund 13,339,936 RMB common share ChinaAMC Blue Chip Core Mixed Fund 11,602,600 RMB common share ChinaAMC Advantage Growth Fund 11,454,573 RMB common share Bank of Communications Schroder Selected Stock Fund 11,012,383 RMB common share Penghua Dynamic Growth Mixed Stock Fund 9,957,859 RMB common share Invesco Great Wall Selected Blue Chip Stock Fund 9,367,100 RMB common share Invesco Great Wall Dingyi Stock Open-ended fund 9,000,000 RMB common share Bank of Communications Schroder Blue Chip Stock Fund 9,000,000 RMB common share §3. Significant eventsChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 3 3.1 Particulars about material changes in items of main accounting statement and financial index, and explanations of reasons √Applicable □Inapplicable Unit: RMB Item Sep. 30, 2009 Dec. 31, 2008 Increase/decrease (± %) Main reasons for changes Monetary capital 10,015,974,827 7,389,133,547 35.55% Increasing income received from property pre-sale brought along growth in this item in the period Transaction financial assets 1,740,006 97,331,980 -98.21% Due to declining delivery of NDF contracts and price fluctuation in NDF market in this period Other receivables 530,022,773 778,506,128 -31.92% Some capital paid for supporting development of joint ventures and affiliated companies were collected bank in the period Other current assets 557,823,354 227,596,742 145.09% Expanding sales resulted in increase of tax paid in advance in this period Deferred income tax assets 94,950,579 40,876,227 132.29% Due to the increasing deductable temporary difference Short-term loans 1,337,116,377 3,613,956,278 -63.00% Due to the repayment of some loans in this period Account received in advance 8,174,461,259 2,731,472,693 199.27% Increasing income received from property pre-sale brought along growth in this item in the period Other current liabilities 971,694,306 459,072,398 111.66% Due to that land value-added tax withdrawn by the Company had been increased Item Jan. to Sep., 2009 Jan. to Sep., 2008 Increase/decrease (± %) Main reasons for changes Operating income 5,287,377,216 1,910,789,863 176.71% Income carried forward from property sales had been raised in this period Operating cost 3,052,074,092 1,106,404,510 175.86% Cost carried forward from property sales had been raised in this period Business tax and surcharges 836,763,041 163,879,482 410.60% Taxes arising from property sales had been raised in this period Sales expense 173,644,402 128,230,528 35.42% Property sales had been raised in this period, correspondingly the sales expenses also climbed up Income from changes in fair value -115,121,120 108,986,815 -205.63% For the Company received more income from DNF delivery in this period, the fair value corresponding to the original contract was thus offset. Investment income 257,788,655 14,553,312 1671.34% The Company received more income from investing joint ventures and NDF delivery in this report period 3.2 Progress of significant events, their influences, and analysis and explanation of their solutions □Applicable √Inapplicable 3.3 Implementations of commitments by the Company, shareholders and actual controller √Applicable □Inapplicable Commitments Content of commitments Implementation Commitments for Share Shekou Industrial Zone committed that the original In the report period, ShekouChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 4 Merger Reform non-negotiable shares shall not been traded or transferred in 24 months since the trading right been granted. Shares placed in Shenzhen Stock Exchange in 12 months upon the above 24 months shall not exceed 5% of the total shares of the Company. In 36 months upon the above 24 months, the price of A-shares of the Company shall not be lower than 120% of the arithmetical average in 30 days prior to the publishing of share reallocation announcement. Shekou Industrial Zone committed to propose the equity mechanism plan of management team, but it could be put in practice after submitting to the Board and the approval of the Shareholders’’ General Meeting; in accordance with the exploitation plan and operation needs of the Company, Shekou Industrial Zone would continue to inject outstanding assets such as land to support the development of the Company. Industrial Zone fulfilled the commitment strictly. Commitments on share restriction for trading When previous increasing of shareholding, CMSIZ and its subsidiaries promised not to reduce their shareholding in the Company until September 24, 2010. China Merchants Zhangzhou Development Zone Co., Ltd. subscribed the 37,878,788 shares in 2008, and promised not to put these shares on sale in one year since purchased. In the report period, Shekou Industrial Zone and its underlying subsidiaries strictly implemented the commitment. In the report period, China Merchants Zhangzhou Development Zone Co., Ltd. strictly implemented the commitment. Commitments made in Acquisition Report or Reports on Change in Interests Inapplicable Inapplicable Commitments made in Material Assets Reorganization Inapplicable Inapplicable Commitments made in issuing Inapplicable Inapplicable Other commitments (including additional commitments) Shekou Industrial Zone promised to neither directly or indirectly conduct or develop the same or similar business or projects with that of the Company, nor found, develop, participate in, or assist any enterprise for Shekou Industrial Zone or related parties or any 3rd party to directly or indirectly compete with the Company; neither use the information obtained from the Company to conduct or participate in activities to compete with the Company, nor conduct any other competitive activity hurting or possibly hurting interests of the Company. In the report period, Shekou Industrial Zone fulfilled the commitment strictly. 3.4 Estimation of accumulative net profit from the beginning of the year to the end of next report period to be loss probably or the warning of its material change compared with the corresponding period of the last year and explanation of reason □Applicable √Inapplicable 3.5 Particulars about the other significant events which needed explanations (I) The Company neither provided capital for controlling shareholders or related parties, nor disobeyed regulations and procedure to provide external guarantee; (II) On July 24, 2009, the 5th meeting of the 6th board of directors approved that the Company planned to non-publicly issue A shares. The objects were not more than 10 special investorsChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 5 including the controlling shareholder – Shekou Industrial Zone. The total issuing amount was not more than 0.2 billion shares, and capital planned to raise was not more than RMB 5 billion (not deducting issuing expenses). The final issuing amount would be negotiated and decided by the Company and sponsor organization (the main seller) according to the subscription and raised capital demand of the Company. Shekou Industrial Zone would subscribe the shares non-publicly issued this time in cash with the same price of other purchasers which was not lower than 10% of the total raised capital in this issuing. The subscribing price would be not lower than 90% of the average trading price of the Company’s shares in the 20 trading days before pricing ex-date. The bidding price result would be negotiated and decided by the board of directors and sponsor organization (the main seller) according to regulations of Rules for the Non-public Issuance of Stocks by Listed Companies. Shekou Industrial Zone did not take part in the procedure of checking price in the market, but it promised to accept the result and purchase at the same price with other special investors. On Aug. 17, 2009, the First Extraordinary Shareholders’ General Meeting 2009 of the Company examined and approved the aforementioned issuance plan. Details of the aforementioned issues could be found in relevant notice disclosed in Juchao Website on Aug. 18, 2009. The application on the Company’s non-publicly issuing A shares has reported to China Securities Regulatory Commission. 3.5.1 Activities on receiving research, communication and interview in the report period Date Place Way The received parties Contents discussed and materials supplied July 2 Chongqing Interim Strategy Meeting Organized by Guosen Securities Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. July 3 Shenzhen Interim Strategy Meeting Organized by China Jianyin Investment Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. July 8 Shekou, Shenzhen Investigation CREDIT SUISSE 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. July 9 Shekou, Shenzhen Investigation Mitsubishi UFJ Investment Co., Ltd.(Hong Kong) 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. July 22 Shekou, Shenzhen Investigation Cathay Life Insurance Company Ltd. and Daiwa Securities SMBC-Cathay Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. July 23 Shekou, Shenzhen Investigation Yuanta Securities CO., LTD., Shanghai Office 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. July 30 Shekou, Shenzhen Investigation Robeco Hong Kong Limited 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced andChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 6 brochure for projects of the Company. Aug. 7 Shekou, Shenzhen Investigation BREVAN HOWARD 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 10 Shekou, Shenzhen Investigation Taiping Shengshi Investment Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 11 Shekou, Shenzhen Investigation Bank of China Investment Management Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 13 Shekou, Shenzhen Investigation Taikang Life Insurance Co., Ltd. and Fortis Haitong Investment Management Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 18 Shekou, Shenzhen Telephone meeting Organized by China Jianyin Investment Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 20 Shekou, Shenzhen Investigation Mizuho Securities Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 25 Shekou, Shenzhen Collective investigation Organized by Citic Fund Management Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 26 Shekou, Shenzhen Investigation KGI Shanghai 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Aug. 28 Shenzhen Forum of Real Estate Industry Organized by Guotai Junan Securities Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Sep. 1 Shekou, Shenzhen Investigation COSMA Investment Management CO., LTD. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Sep. 4 Qingdao Industry Forum Organized by Hai Tong Securities Co., Ltd. 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Sep. 9 Beijing Finance and Real Estate Forum Organized by NOMURA SECURITIES 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Sep. 10 Shanghai Real Estate Organized by 1. Introducing operation of the Company;China Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 7 Industry Meeting Everbright Securities Co., Ltd. 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Sep. 10 Shanghai Information Seminar of Investors Organized by China International Capital Corporation Limited 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Sep. 17 Shekou, Shenzhen Investigation RESEARCH-WOR KS 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. Sep. 18 Shekou, Shenzhen Investigation Ping An Securities Limited 1. Introducing operation of the Company; 2. Discussing the industry development; 3. Providing the information announced and brochure for projects of the Company. 3.6 Particulars about derivatives investment √Applicable □Inapplicable Risk analysis on position of derivatives in the report period, together with measurements for controlling the risks (including but not limit in market risks, current risks, credit risks, operation risks as well as law risks) The Company made forward foreign exchange business in which principal delivery was not involved, was to lock up exchange rate, fundamentally to avoid exchange risk when borrowing foreign currency loans. Thus, business was made on the basis of real foreign exchange loans. Amount and time of deals were in good match with the exchange loans, in order to keep the Company from exchange rate risks. Forward exchange rate had already been confirmed when making a deal. The Company had already established and strictly implemented Trading System for Derivative Financial Instruments, and engaged in NDF business with authorization from the Board. The Company arranged special person to follow up exchange rate of RMB and foreign currency, neaten businesses, and make periodic reports to the supervising leaders or the Board on the could-be influences. Particulars about the businesses would be accepting internal audit and audit & supervision from the Company itself and external accounting firm respectively. Particulars about the market price or fluctuation of fair value of the derivatives invested in the report period. As for analysis on fair value of derivatives, details about the method shall be disclosed, as well as method for setting relevant assumption and parameters. By Sep. 30th of 2009, the notional principal of the forward foreign exchange contracts of the Company totaled to USD 259,229,000, and these contracts would be matured from Feb. 3rd to Sep. 8th of 2010. The fair value of the above contracts as of period-end takes 11.31% of the net assets as of this period of the Company. According to regulations of accounting standards, the Company measured these financial assets by their fair values at the end of this period; gains or losses from change of fair value would be respectively reckoned into current gains and losses as well as transaction financial assets or liabilities. At the beginning of the period, the fair value of forward foreign exchange business contracts of the Company amounted to RMB 97,331,980 and RMB 16,320,002 for that at the end of this period. During the report period, gains & losses obtained from change of fair value of these forward foreign exchange businesses amounted to RMB -115,121,120, and gains & losses arising from actualChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 8 delivery of forward foreign exchange businesses was RMB 76,318,003. Explanation on that whether there is material change in accounting policy and accounting calculation principles applicable to derivatives of the Company in comparison with that of last report period Compared to the last period, no material change had happened to the accounting policy and detailed accounting calculation method applicable for derivatives of the Company. Special opinions issued by independent directors, sponsors or financial consultants of the Company on derivatives investment and risk controlling Inapplicable 3.6.1 Particulars about the positions of derivatives investment at the end of report period √Applicable □Inapplicable Unit: RMB Kind of contract Expired limit Amount of contract in period-begin Amount of contract in period-end Proportion of amount of contract in period-end in net asset of the Company as of report period-end forward foreign exchange contracts Expired from Feb. 3, 2010 to Sep. 8, 2010 1,838,644,092.00 1,770,274,841.00 11.31% Total - 1,838,644,092.00 1,770,274,841.00 11.31% §4. Appendix 4.1 Balance sheet Prepared by China Merchants Properties Development Co., Ltd. Sep. 30, 2009 Unit: RMB Balance at period-end Balance at year-begin Items Consolidation Parent Company Consolidation Parent Company Current assets: Monetary funds 10,015,974,827.00 6,848,809,718.00 7,389,133,547.00 4,728,619,945.00 Settlement provisions Capital lent Transaction finance asset 1,740,006.00 97,331,980.00 Notes receivable Accounts receivable 98,966,936.00 107,177,879.00 Accounts paid in advance 22,377,451.00 28,316,856.00 Insurance receivable Reinsurance receivables Contract reserve of reinsurance receivable Interest receivable 1,574,037.00 Dividend receivable 3,030,848,071.00 3,030,848,071.00 Other receivables 530,022,773.00 12,236,495,445.00 778,506,128.00 14,588,369,018.00 Purchase restituted finance assetChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 9 Inventories 26,123,813,898.00 23,869,301,251.00 Non-current asset due within one year 26,753.00 40,129.00 Other current assets 557,823,354.00 227,596,742.00 Total current assets 37,352,320,035.00 22,116,153,234.00 32,497,404,512.00 22,347,837,034.00 Non-current assets: Granted loans and advances Finance asset available for sales 3,947,981.00 3,947,981.00 1,743,773.00 1,743,773.00 Held-to-maturity investment Long-term account receivable 1,010,129,235.00 873,466,766.00 971,960,034.00 838,808,511.00 Long-term equity investment 951,946,985.00 1,421,500,562.00 771,232,269.00 1,442,068,686.00 Investment property 2,541,693,224.00 2,632,975,770.00 Fixed assets 267,125,451.00 307,986.00 284,573,922.00 320,838.00 Construction in progress 47,449,164.00 39,614,982.00 Engineering material Disposal of fixed asset Productive biological asset Oil and gas asset Intangible assets 60,825.00 94,212.00 Expense on Research and Development Goodwill Long-term expenses to be apportioned 179,533,180.00 206,404.00 196,539,294.00 349,732.00 Deferred income tax asset 94,950,579.00 40,876,227.00 Other non-current asset Total non-current asset 5,096,836,624.00 2,299,429,699.00 4,939,610,483.00 2,283,291,540.00 Total assets 42,449,156,659.00 24,415,582,933.00 37,437,014,995.00 24,631,128,574.00 Current liabilities: Short-term loans 1,337,116,377.00 830,941,000.00 3,613,956,278.00 2,806,081,100.00 Loan from central bank Absorbing deposit and interbank deposit Capital borrowed Transaction financial liabilities 18,060,008.00 Notes payable 328,720,981.00 143,287,841.00 Accounts payable 1,490,087,298.00 1,863,688,472.00 Accounts received in advance 8,174,461,259.00 2,731,472,693.00 Selling financial asset ofChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 10 repurchase Commission charge and commission payable Wage payable 96,844,617.00 799,339.00 121,900,048.00 4,237,517.00 Taxes payable 310,123,457.00 5,990,955.00 270,545,613.00 291,820.00 Interest payable 29,443,865.00 19,223,473.00 41,051,205.00 36,025,186.00 Dividend payable 8,778,785.00 8,778,785.00 Other accounts payable 3,608,797,935.00 3,377,601,948.00 3,154,569,035.00 2,688,993,082.00 Reinsurance payables Insurance contract reserve Security trading of agency Security sales of agency Non-current liabilities due within 1 year 2,205,038,000.00 1,700,000,000.00 1,810,099,402.00 1,550,000,000.00 Other current liabilities 971,694,306.00 77,559.00 459,072,398.00 77,559.00 Total current liabilities 18,579,166,888.00 5,934,634,274.00 14,218,421,770.00 7,085,706,264.00 Non-current liabilities: Long-term loans 6,619,003,643.00 4,723,384,000.00 6,807,315,907.00 3,610,000,000.00 Bonds payable Long-term account payable 44,021,914.00 33,285,411.00 Special accounts payable Projected liabilities 81,150,850.00 90,466,298.00 Deferred income tax liabilities 475,141.00 475,141.00 34,300.00 34,300.00 Other non-current liabilities 8,009,156.00 7,984,305.00 Total non-current liabilities 6,752,660,704.00 4,723,859,141.00 6,939,086,221.00 3,610,034,300.00 Total liabilities 25,331,827,592.00 10,658,493,415.00 21,157,507,991.00 10,695,740,564.00 Owner’s equity (or shareholders’ equity): Paid-in capital (or share capital) 1,717,300,503.00 1,717,300,503.00 1,717,300,503.00 1,717,300,503.00 Capital public reserve 8,548,308,151.00 8,929,833,989.00 8,548,544,784.00 8,928,070,622.00 Less: Inventory shares Reasonable reserve Surplus public reserve 670,226,504.00 619,275,111.00 670,226,504.00 619,275,111.00 Provision of general risk Retained profit 4,647,255,592.00 2,490,679,915.00 3,858,062,286.00 2,670,741,774.00 Balance difference of foreign currency translation 70,489,312.00 68,612,288.00 Total owner’s equity attributable to parent company 15,653,580,062.00 13,757,089,518.00 14,862,746,365.00 13,935,388,010.00 Minority interests 1,463,749,005.00 1,416,760,639.00China Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 11 Total owner’s equity 17,117,329,067.00 13,757,089,518.00 16,279,507,004.00 13,935,388,010.00 Total liabilities and owner’s equity 42,449,156,659.00 24,415,582,933.00 37,437,014,995.00 24,631,128,574.00 4.2 Profit statement in the report period Prepared by China Merchants Properties Development Co., Ltd. July-Sep. 2009 Unit: RMB Items ConsolidatioTnh is perPioadr ent Company ConTsohlei dsaatmioen p eriodP oafr elanstt Cyeoamr pany I. Total operating income 2,411,599,990.00 463,856,267.00 Including: Operating income 2,411,599,990.00 463,856,267.00 Interest income Insurance gained Commission charge and commission income II. Total operating cost 1,887,905,313.00 -5,917,507.00 441,715,730.00 -9,316,366.00 Including: Operating cost 1,423,795,830.00 314,999,465.00 Interest expense Commission charge and commission expense Cash surrender value Net amount of expense of compensation Net amount of withdrawal of insurance contract reserve Bonus expense of guarantee slip Reinsurance expense Operating tax and extras 356,279,134.00 22,525,248.00 Sales expenses 59,048,409.00 57,775,900.00 Administration expenses 50,722,630.00 6,753,629.00 36,353,995.00 3,527,701.00 Financial expenses -1,935,612.00 -12,671,136.00 10,062,058.00 -12,844,067.00 Losses of devaluation of asset -5,078.00 -936.00 Add: Changing income of fair value(Loss is listed with “-”) -6,749,968.00 110,964,093.00 Investment income (Loss is listed with “-”) 69,038,059.00 -5,043,221.00 41,838,899.00 -1,311,260.00 Including: Investment income on affiliated company and joint venture 69,233,141.00 -742,855.00 37,724,452.00 -1,311,260.00 Exchange income (Loss is listed with “-”) III. Operating profit (Loss is listed with “-”) 585,982,768.00 874,286.00 174,943,529.00 8,005,106.00 Add: Non-operating income 4,249,938.00 6,214,164.00China Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 12 Less: Non-operating expense 31,973.00 811,870.00 100,000.00 Including: Disposal loss of non-current asset -13,799.00 -39,612.00 IV. Total Profit (Loss is listed with “-”) 590,200,733.00 874,286.00 180,345,823.00 7,905,106.00 Less: Income tax expense 127,559,974.00 16,693,272.00 V. Net profit (Net loss is listed with “-”) 462,640,759.00 874,286.00 163,652,551.00 7,905,106.00 Net profit attributable to owner’s of parent company 474,075,608.00 169,928,805.00 Minority shareholders’ gains and losses -11,434,849.00 -6,276,254.00 VI. Earnings per share i. Basic earnings per share 0.276 0.1508 ii. Diluted earnings per share 0.276 0.1508 VII. Other consolidated income -11,756.00 -11,756.00 VIII. Total consolidated income 462,629,003.00 862,530.00 163,652,551.00 7,905,106.00 Total consolidated income attributable to owners of parent company 474,063,852.00 169,928,805.00 Total consolidated income attributable to minority shareholders -11,434,849.00 -6,276,254.00 4.3 Profit statement from year-begin to the end of report period Prepared by China Merchants Properties Development Co., Ltd. Jan.-Sep. 2009 Unit: RMB Amount in this period Amount in last period Items Consolidation Parent Company Consolidation Parent Company I. Total operating income 5,287,377,216.00 1,910,789,863.00 Including: Operating income 5,287,377,216.00 1,910,789,863.00 Interest income Insurance gained Commission charge and commission income II. Total operating cost 4,236,491,338.00 1,463,319.00 1,554,007,666.00 25,250,520.00 Including: Operating cost 3,052,074,092.00 1,106,404,510.00 Interest expense Commission charge and commission expense Cash surrender value Net amount of expense of compensation Net amount of withdrawal of insurance contract reserve Bonus expense ofChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 13 guarantee slip Reinsurance expense Operating tax and extras 836,763,041.00 163,879,482.00 Sales expenses 173,644,402.00 128,230,528.00 Administration expenses 141,541,430.00 15,752,466.00 110,510,037.00 13,255,419.00 Financial expenses 32,581,415.00 -14,289,147.00 44,978,148.00 11,995,101.00 Losses of devaluation of asset -113,042.00 4,961.00 Add: Changing income of fair value(Loss is listed with “-”) -115,121,120.00 108,986,815.00 Investment income (Loss is listed with “-”) 257,788,655.00 -6,868,490.00 14,553,312.00 -9,277,632.00 Including: Investment income on affiliated company and joint venture 179,118,035.00 -2,568,124.00 32,265,948.00 -3,006,808.00 Exchange income (Loss is listed with “-”) III. Operating profit (Loss is listed with “-”) 1,193,553,413.00 -8,331,809.00 480,322,324.00 -34,528,152.00 Add: Non-operating income 22,125,313.00 19,049,202.00 Less: Non-operating expense 1,387,639.00 2,874,668.00 100,000.00 Including: Disposal loss of non-current asset 305,008.00 -10,359.00 IV. Total Profit (Loss is listed with “-”) 1,214,291,087.00 -8,331,809.00 496,496,858.00 -34,628,152.00 Less: Income tax expense 269,613,177.00 115,149,708.00 V. Net profit (Net loss is listed with “-”) 944,677,910.00 -8,331,809.00 381,347,150.00 -34,628,152.00 Net profit attributable to owner’s of parent company 960,923,356.00 388,657,810.00 Minority shareholders’ gains and losses -16,245,446.00 -7,310,660.00 VI. Earnings per share i. Basic earnings per share 0.560 0.3450 ii. Diluted earnings per share 0.560 0.3450 VII. Other consolidated income -236,633.00 1,763,367.00 -86,575,026.00 VIII. Total consolidated income 944,441,277.00 -6,568,442.00 294,772,124.00 -34,628,152.00 Total consolidated income attributable to owners of parent company 960,686,723.00 302,082,784.00 Total consolidated income attributable to minority shareholders -16,245,446.00 -7,310,660.00 4.4 Cash flow statement from year-begin to the end of report periodChina Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 14 Prepared by China Merchants Properties Development Co., Ltd. Jan.-Sep. 2009 Unit: RMB Amount in this period Amount in last period Items Consolidation Parent Company Consolidation Parent Company I. Cash flows arising from operating activities: Cash received from selling commodities and providing labor services 10,797,563,292.00 4,204,614,771.00 Net increase of customer deposit and interbank deposit Net increase of loan from central bank Net increase of capital borrowed from other financial institution Cash received from original insurance contract fee Net cash received from reinsurance business Net increase of insured savings and investment Net increase of disposal of transaction financial asset Cash received from interest, commission charge and commission Net increase of capital borrowed Net increase of returned business capital Write-back of tax received 1,347,949.00 2,655,454.00 Other cash received concerning operating activities 1,250,535,398.00 4,197,256,719.00 893,647,564.00 77,135,999.00 Subtotal of cash inflow arising from operating activities 12,049,446,639.00 4,197,256,719.00 5,100,917,789.00 77,135,999.00 Cash paid for purchasing commodities and receiving labor service 4,140,838,730.00 5,904,551,422.00 Net increase of customer loans and advances Net increase of deposits in central bank and interbank Cash paid for original insurance contract compensation Cash paid for interest, commission charge and commission Cash paid for bonus of guarantee slip Cash paid to/for staff and workers 353,886,452.00 7,411,012.00 405,082,867.00 13,042,094.00 Taxes paid 1,078,187,484.00 1,149,211.00 658,658,076.00 27,189,256.00 Other cash paid concerning operating activities 1,324,498,657.00 880,548,883.00 920,251,183.00 2,577,201,170.00 Subtotal of cash outflow arising from operating activities 6,897,411,323.00 889,109,106.00 7,888,543,548.00 2,617,432,520.00 Net cash flows arising from operating activities 5,152,035,316.00 3,308,147,613.00 -2,787,625,759.00 -2,540,296,521.00China Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 15 II. Cash flows arising from investing activities: Cash received from recovering investment 1,522,182.00 40,702,142.00 40,702,142.00 Cash received from investment income 413,971.00 12,515,977.00 Net cash received from disposal of fixed, intangible and other long-term assets 160,494.00 229,823.00 Net cash received from disposal of subsidiaries and other units 103,002.00 Other cash received concerning investing activities 75,344,057.00 Subtotal of cash inflow from investing activities 77,440,704.00 53,550,944.00 40,702,142.00 Cash paid for purchasing fixed, intangible and other long-term assets 31,197,012.00 56,563,830.00 Cash paid for investment 7,337,852.00 157,957,709.00 90,000,000.00 Net increase of mortgaged loans Net cash received from subsidiaries and other units -3,010,125.00 Other cash paid concerning investing activities 60,872,194.00 Subtotal of cash outflow from investing activities 38,534,864.00 272,383,608.00 90,000,000.00 Net cash flows arising from investing activities 38,905,840.00 -218,832,664.00 -49,297,858.00 III. Cash flows arising from financing activities Cash received from absorbing investment 75,000,000.00 226,985,250.00 Including: Cash received from absorbing minority shareholders’ investment by subsidiaries 75,000,000.00 226,985,250.00 Cash received from loans 5,037,063,977.00 4,298,346,000.00 5,812,540,085.00 2,851,295,800.00 Cash received from issuing bonds Other cash received concerning financing activities Subtotal of cash inflow from financing activities 5,112,063,977.00 4,298,346,000.00 6,039,525,335.00 2,851,295,800.00 Cash paid for settling debts 7,107,178,142.00 5,010,102,100.00 2,765,582,797.00 1,185,295,800.00 Cash paid for dividend and profit distributing or interest paying 626,589,538.00 479,459,685.00 624,289,608.00 415,999,592.00 Including: Dividend and profit of minority shareholder paid by subsidiaries 1,330,292.00 Other cash paid concerning financing activities Subtotal of cash outflow from financing activities 7,733,767,680.00 5,489,561,785.00 3,389,872,405.00 1,601,295,392.00 Net cash flows arising from financing activities -2,621,703,703.00 -1,191,215,785.00 2,649,652,930.00 1,250,000,408.00 IV. Influence on cash and cash -438,335.00 -37,684.00 14,372,735.00 -919,807.00China Merchants Property Development Co., Ltd. The Third Quarterly Report for 2009 (Full Text) 16 equivalents due to fluctuation in exchange rate V. Net increase of cash and cash equivalents 2,568,799,118.00 2,116,894,144.00 -342,432,758.00 -1,340,513,778.00 Add: Balance of cash and cash equivalents at the period -begin 7,358,057,106.00 4,728,619,945.00 3,544,984,914.00 2,454,024,042.00 VI. Balance of cash and cash equivalents at the period -end 9,926,856,224.00 6,845,514,089.00 3,202,552,156.00 1,113,510,264.00 4.5 Auditor’s report Auditor’s opinions: Un-audited