Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Stock Code: 200054 Stock ID: Jianmo B Announcement No. 2012-040 Interim Report 2012 Summary I. Important Statement The Board of Directors and the directors of the Company guarantee that there are no significant omissions, fictitious or misleading statements carried in the Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness of the Report. Disagreement claimed by the Directors, Supervisors or the Executives Reason for unable to guarantee for the Name Position thruthfulness, accuracy and completeness of the report Declaration: Directors other than the followings presented the Board Meeting at which this report was examined: Reason for not presenting the Name of the director absented Position Name of consignee meeting Hao Lin Director On business travel Tang Wenquan Auditors’ Opinions The Interim Report was not audited by CPA. Mr. Li Huaguang, the responsible people of the Company, Mr. Teng Feng, the Chief Financial Officer, and Mr. Liao Jian manager of accounting department declare: the Financial Report carried in this report is authentic and completed. II. Profile of the Company (I) Basic information ID of B-stock Jianmo B Code of B-stock 200054 Stock Exchange Shenzhen Stock Exchange Secretary of the Board Representative of Stock Affairs Name Teng Feng Liu Hongyu No.1 Jianshe Road, Huaxi Industrial Zone, No.1 Jianshe Road, Huaxi Industrial Zone, Address Ba’nan District, Chongqing Ba’nan District, Chongqing Tel. (023)66295333 (023)66295333 Fax. (023)66295333 (023)66295333 Email. cqjsmc@jianshe.com.cn cqjsmc@jianshe.com.cn (II) Financial Highlights 1. Main accounting data and indices 1 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary If retrospective adjustment has been carried out on financial reports of previous periods [] Yes [V] No Ended this report term Ended previous year Changed by (%) Gross Assets (RMB) 2,856,550,977.9 2,691,721,123.4 6.12% Owners’ equity attributable to the 252,758,439.86 286,466,093.56 -11.77% shareholders of the listed company (yuan) Capital shares (shares) 477,500,000 477,500,000 0% Net asset per share attributable to the shareholders of the listed company 0.53 0.6 -11.67% (Yuan/share) Liability on asset ratio (%) 91.07% 89.29% 1.78% Increase/decrease over Report term (Jan-Jun) Same period last year same period of last year(%) Turnover (yuan) 968,858,593.63 1,371,442,562.5 -29.35% Business profit (RMB) -33,258,411.48 -1,086,285.25 -2,961.62% Gross profit (RMB) -33,035,241.44 40,478.66 -81,711.5% Net profit attributable to shareholders of -33,707,653.7 1,364,363.06 -2,570.58% the listed company (yuan) Net profit attributable to the shareholders of the listed company and after deducting -33,930,823.74 237,599.15 -14,380.7% of non-recurring gain/loss(RMB) Basic earnings per share (Yuan/share) -0.0706 0.0029 -2534.48% Diluted earnings per share (Yuan/share) -0.0706 0.0029 -2534.48% Weighted average net -12.5% 0.29% -12.79% income/asset ratio (%) Weighted average net income/asset ratio less non-recurring -12.59% 0.05% -12.64% gain/loss(%) Net Cash flow generated by business -41,048,514.26 -31,868,308.65 -28.81% operation (RMB) Net Cash flow per share generated by -0.09 -0.07 -28.57% business operation (yuan/share) Statement on the accounting data and financial indicies at end of report term. (Please state if retrospective adjustment was made.) 2. Non-recurring profit/loss items [V] Applicable [] Not applicable Amount from the beginning Non-recurring gain and loss items of year to the end of report Remarks period RMB Gain/loss of non-current assets -73,623.94 Tax refunding or exemption without official certification or exceeded authority Gains and losses included in the current period of government subsidies, excluding those government grants which are closely related to normal business and in line with 122,200 national policy , or in accordance with fixed standards or quantities Capital adoption fee collected from non-financial organizations and accounted into current gain/loss Gain/loss from differences between the cost of enterprise merger and the fair value of recognizable net asset of the invested entities 2 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Gain/loss from non-monetary assets Gain/loss from commissioned investment or assets Asset impairment provisions provided for force-majeur Gain/loss from debt reorganization Enterprise reorganizing expenses, such as employee placement fee and integration fee Gain/loss from trade departing from fair value Current net gain/loss of subsidiaries under same control from beginning of term till date of consolidation Gain/loss generated by contingent liabilities without connection with main businesses Gain/loss from change of fair value of transactional asset and liabilities, and investment gains from disposal of transactional financial assets and liabilities and sellable financial assets, other than valid period value instruments related to the Company’s common businesses Restoring of receivable account impairment provision tested individually Gain/loss from commissioned loans Gain/loss from change of fair value of investment property measured at fair value in follow-up measurement Influence of one-time adjustment made on current gain/loss account according to the laws and regulations regarding tax and accounting Consigning fee received for cosigned operation Other non-business income and expenditures other than the above Other gain/loss items satisfying the definition of 174,593.8 non-recurring gain/loss account Influenced amount of minority shareholders’ equity Influenced amount of income tax Total 223,170.04 -- 3. Differences in net profit and net asset under domestic and international accounting standards [V] Applicable [] Not applicable In RMB Yuan Net profit attributable to the shareholders of the Owners’ equity to shareholders of the listed listed company company Current term Previous term At end of term At beginning of term On Chinese Accounting -33,707,653.7 1,364,363.06 252,758,439.86 286,466,093.56 Standard Items and amounts adjusted on IAS Under International Accounting Standard 4. Differences in net profit and net asset under domestic and overseas accounting standards [V] Applicable [] Not applicable In RMB Yuan 3 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Net profit attributable to the shareholders of the Owners’ equity to shareholders of the listed listed company company Current term Previous term At end of term At beginning of term On Chinese Accounting -33,707,653.7 1,364,363.06 252,758,439.86 286,466,093.56 Standard Accounts and amounts adjusted according to overseas accounting standard On IAS III. Particulars About the Capital Share and Shareholders (I) Statement of Change in Capital Share [] Applicable; [V] Not applicable (II) Top 10 shareholders and top 10 holders of un-restricted / current shares Top 10 shareholders and current-share holders Total of shareholders 15,380 Top Ten Shareholders Properties of Proportio Shares held at the Non-negotiable Frozen or pledged Full name of shareholder shareholder n% end of report term shares held Status of shares Amount China Southern Industry Pledge 0 State-owned shares 71.13% 339,625,000 339,625,000 Group Co., Ltd. Restricted 0 Pledge 0 Gu Zuocheng Others 1.86% 8,875,000 8,875,000 Restricted 0 Anhui Hengsheng Pledge 0 Public legal person Economic Development 1.47% 7,000,000 7,000,000 shares Restricted 0 Group Co., Ltd. Pledge 0 Feng Yonghui Others 0.42% 2,000,000 2,000,000 Restricted 0 Shanghai Hong Kong Pledge 0 Foreign shares 0.27% 1,271,001 0 Wanguo Securities Restricted 0 Pledge 0 Wang Chuxin Foreign shares 0.22% 1,050,000 0 Restricted 0 Pledge 0 Chen Hanjie Foreign shares 0.12% 550,000 0 Restricted 0 Pledge 0 Huang Lianna Foreign shares 0.11% 539,800 0 Restricted 0 Pledge 0 Cai Yugui Foreign shares 0.11% 515,900 0 Restricted 0 Pledge 0 Peng Daqiang Foreign shares 0.1% 470,849 0 Restricted 0 Top Ten Shareholders of Negotiable Shares Categories and amounts of shares Name of the shareholder Current shares held Categories Amount 4 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Shanghai Hong Kong Wanguo Securities 1,271,001 B shares Wang Chuxin 1,050,000 B shares 1,050,000 Chen Hanjie 550,000 B shares 550,000 Huang Lianna 539,800 B shares 539,800 Cai Yugui 515,900 B shares 515,900 Peng Daqiang 470,849 B shares 470,849 Li Mingya 424,400 B shares 424,400 Zhang Shaoqin 420,800 B shares 420,800 Luo Hongbo 400,000 B shares 400,000 Zhu Gengxin 391,811 B shares 391,811 There isn’t any associated relationship between the sponsoring shareholder and the other shareholders among the top-10 list. None of them are regarded as Statement of relationships and (or) ‘Acting in concert’ in accordance with ‘The rules of information disclosure on action-in-concert among above shareholders: change of shareholding.’ Foreign shareholders are unknown for their condition of ‘Associated relationship’ and ‘Acting in concert’. (III) Change of controlling shareholder and substantial controller [] Applicable; [V] Not applicable IV. Particulars about the Directors, Supervisors, and Senior Management (I) Change of shareholding by directors, supervisors, and executives Shares Shares Incl. Amount Share options Shares Shares held holding at the decreased of shares held at the Cause of Name Position increased this at the end of beginning of this term under end of term change term (shares) term term (shares) (shares) restriction (shares) V. Report of the Board (I) Main business segment in industries and products In RMB Yuan Segments on industries Increase/decrease Increase/decrease Increase/decrease of operation cost of gross profit Gross profit of turnover over On Industries Turnover Operation cost over the same ratio over the ratio % the same period period of last year same period of of last year (%) (%) last year (%) Industry 899,950,333.01 765,044,914.66 14.99% -33.67% -35.16% 15.03% Segements on products 5 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Increase/decrease Increase/decrease Increase/decrease of operation cost of gross profit Gross profit of turnover over On Products Turnover Operation cost over the same ratio over the ratio % the same period period of last year same period of of last year (%) (%) last year (%) Motorcycle and 633,626,513.96 535,339,578.16 18.36% -33.11% -37.04% 60.93% parts Vehicle air 266,323,819.05 229,705,336.5 15.94% -34.96% -30.32% -34.15% conditioner Statement of significant change of gross profit over the same period of previous year Growing of gross profit ratio of motorcycle products was caused by increasing of sales prices of main products and parts, and decreasing of costs. Decreasing of gross profit ratio of air-conditioner products was caused by declining of sales price. (II) Main business segment on regions In RMB Yuan Regions Turnover Change of turnover YoY (%) North 106,393,837.49 -45.87% East 81,191,969.24 -13.9% Mid-south 52,841,162.17 -1.75% South-west 403,423,014.5 -42.78% North-east 43,291,987.47 -14.79% North-west 35,775,716.14 -28.93% South 32,505,376.53 -28.9% Overseas sales 144,527,269.47 -9.74% (III) Statement on material change in main business composision [] Applicable; [V] Not applicable (IV) Statement on material change in main business profitability (gross profit) [V] Applicable [] Not applicable (V) Analyze of major changes on profit composition comparing with the same period of last year [] Applicable; [V] Not applicable (VI) Usage of financing proceeds 1. Comparison of usage of financing proceeds [] Applicable; [V] Not applicable 2. Statement on change of projects invested with financing proceeds [] Applicable; [V] Not applicable 6 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary (VII) Revising of business plan for the 2nd half of year by the Board [] Applicable; [V] Not applicable (VIII) Prediction of business performance in Jan-Sept 2012 Alert of loss or significant change in net profit from the beginning of year to the end of next report period or comparing with the same period of last year, and statement of causations. [] Applicable; [V] Not applicable (IX) Statement of the Board on the 搉 on-standard auditors’ reportissued by the CPA on the current report period [] Applicable; [V] Not applicable (X) Statement of the Board on the variation and treatment of events that involved in the 搉 on-standard auditors’ reportissued by the CPA on previous fiscal year [] Applicable; [V] Not applicable VI. Significant Events (I) Acquisition, dispsal, or reconstruction of assets 1. Acquisition of assets [] Applicable; [V] Not applicable Statement on acquisition of assets. 2. Disposal of assets [] Applicable; [V] Not applicable Statement on disposal of assets. 3. Since releasing of capital reconstruction report or asset acquisition or disposal report, their progress and influences on the business performance and financial positions. [] Applicable; [V] Not applicable 7 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary (II) Guarantee issues [V] Applicable [] Not applicable In RMB10 thousand External Guarantee (Exclude controlled subsidiaries) Amount of Actual date of Amount of Related Guarantee provided guarantee occurring Actual amount Type of Complete the Term party or to and date of (signing date of of guarantee guarantee d or not guarantee not disclosure agreements Total of external guarantee Total of external guarantee 0 actually occurred in the report 0 approved in the report term (A1) term (A2) Total of external guarantee Total of external guarantee approved as of end of report term 0 actually occurred as of end of 0 (A3) report term (A4) Guarantee provided to controlled subsidiaries Amount of Actual date of Amount of Related Guarantee provided guarantee occurring Actual amount Type of Complete the Term party or to and date of (signing date of of guarantee guarantee d or not guarantee not disclosure agreements Chongqing Jianshe Apr 20, 2,800 Feb 09, 2012 2,800 1 year Yes No Sales Co., Ltd. 2012 Chongqing Jianshe Apr 20, 2,400 May 3, 2012 2,400 Half a yr Yes No Sales Co., Ltd. 2012 Chongqing Jianshe Apr 20, 3,600 May 16, 2012 3,600 Half a yr Yes No Sales Co., Ltd. 2012 Chongqing Jianshe Apr 20, 5,000 June 13, 2012 5,000 Half a yr Yes No Sales Co., Ltd. 2012 Chognqing Jianshe Automobile Apr 20, October 18, 5,000 5,000 10 months Yes No Air-conditioner Co., 2012 2011 Ltd. Chognqing Jianshe Automobile Apr 20, August 30, 3,850 3,850 Two years Yes No Air-conditioner Co., 2012 2010 Ltd. Chognqing Jianshe Automobile Apr 20, 4,700 Dec 28 2009 4,700 Three years Yes No Air-conditioner Co., 2012 Ltd. Total of guarantee to Total of guarantee to subsidiaries 38,500 subsidiaries actually occurred 34,400 approved in the report term (B1) in the report term (B2) Total of balance of guarantee Total of guarantee to subsidiaries actually provided to the approved as of the report term 38,500 27,350 subsidiaries as of end of report (B3) term (B4) Total of guarantee provided by the Company (i.e. total of the above two items) Total of guarantee approved in the Total of guarantee occurred in 38,500 34,400 report term (A1+B1) the report term (A2+B2) Total of guarantee approved as of Total of guarantee occurred as 38,500 27,350 end of report term (A3+B3) of the end of report term Percentage of the total guarantee occurred (A4+B4) on net asset 108.21% of the Company 8 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary In which: Guarantees provided to the shareholders, substantial controllers 27,350 and the related parties (C) Guarantee provided directly or indirectly to objects with over 27,350 70% of liability on asset ratio (D) Amount of guarantee over 50% of the net asset (E) 14,712 Total of the above 3 * (C+D+E) 27,350 Statement on the possible joint liabilities on the guarantees not due yet Remarks on illegal providing of external guarantee (III) Non-operational capital interchange with related parties [] Applicable; [V] Not applicable (IV) Material lawsuit or arbitration [V] Applicable [] Not applicable 1. No new major lawsuit or arbitration issues happened in the report term. 2. Unsettled material lawsuit or arbitration in the report period. (1) On January 5, 2009, Chongqing Northern Jianshe Import & Export Co., Ltd. appealed to Chongqing Jiulongpo People’s Court against Chongqing Huiyao Motorcycle Co., Ltd. for returning of trade account of RMB3.3 million, and L/C credit interest of RMB75 thousand, and relative interest losses (basing on RMB3.375 million, at the bank loan interest rate at the same period since August 16, 2007 till the account was cleared). On May 20, 2009, the court opened trial on this case and judged in favor of the Import & Export Co. The defender appealed to No.5 Middle Court but rejected for it has failed to pay the appeal fee. This case is now in execution period The Company sued to Chongqing Bannan District Court on July 20, 2011 claiming for dismissing of the Work Contract and Technical Contract with Ningbo Huiwang Machinery Co., Ltd. and the trade payment of RMB680 thousand and interests (at same interest rate of the bank since July 1, 2007 up to the date of clearing), and property preservation. The trial was opened on November 15, 2011, the above contracts were judged to be dismissed on August 5, 2011, and the payment RMB680 thousand and related losses will be paid to the Company. Ningbo Huiwang Machinery Co., Ltd. lodged appeal to the No.5 Middle court of Chongqing. An settlement agreement has been engaged between the parties. According to the agreement, the Company will accept and examine the goods sent by Ningbo Huiwang in one month. The balance of RMB70 thousand will be paid and the property preservation will be retrieved upon passing of examination. At present the goods have been delivered by Ningbo Huiwang. 3. Major lawsuit and arbitrative issues closed in the report term. (2) Jiang Fuqiang and Chongqing Qianhua Machinery Co., Ltd. sued to the 1st middle court of Chongqing on December 17, 2009 claiming for recognition of motorcycle cargo trestle manufactured and sold by Congqing Jianshe Sales Co., Ltd. and Chongqing Feida Surface Processing Center Ltd. to be one of the protected patents of the claimer. They claimed to stop manufacturing and sales of the subject and RMB500 thousand of compensation, and the lawsuit fees. During the trial period, Chongqing Feida Surface Processing Center Ltd. claimed for invalid patent to the Reviewing Committee of National Committee of Patents. Therefore the 1st Middle Court of Chongqing suspended the trial. Jiang Fuqiang and Chongqing Qianhua Machinery Co., Ltd. retrieved the claiming on March 2, 2012. (2) Chongqing Northern Jianshe Import and Export Co., Ltd. sued to Chongqing No.5 Middle Court in September 2010, claiming for USD1.390472 million of trade account and interests from Weiran Motorcycle (Nigeria) Co., Ltd. The Court has accepted the application on October 19, 2010. Serving of court notice will be through diplomatic channel for it involves in international lawsuit. The claiming of Chongqing Northern Jianshe Import & Export Co., Ltd. was rejected by the Court on May 16, 2012. 9 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary (V) Influence and resolutions of other material events [] Applicable; [V] Not applicable 1. Securities investment [] Applicable; [V] Not applicable Statement on securities investment 2. Holding of other PLC’s shares [] Applicable; [V] Not applicable Statement on holding of other PLC’s shares. 3. Capital appropriation and progress of settlement in report period [] Applicable; [V] Not applicable The penalty plan proposed by the Board if the clearing of non-operational capital appropriation is not completed till the end of report period. [] Applicable; [V] Not applicable 4 Fulfilling of commitment issues Commitment made by the PLC, its directors, supervisors, executives, and shareholders with 5% or over shares of the Company, and its substantial dominator in the report term or carried over to the report term: [] Applicable; [V] Not applicable 5. Dividend or common reserve capitalizing plan proposed by the Board [] Applicable; [V] Not applicable 6. Other misc income accounts In RMB Yuan Items Occurred current term Occurred in previous term 1. Amount of gain (loss) from sellable financial assets Less: Income tax influence of available-for-sale financial assets Net amount written into other gains and transferred into gain/loss in previous terms Sub-total 2. Share in other misc. income of the invested company on equity basis Less: Income tax influence of shares in other gains of investees on equity basis Net amount written into other gains and transferred into gain/loss in previous terms Sub-total 3. Amount of gain (loss) from cash flow hedging instruments Less: Income tax influence of cash flow hedge instruments Net amount written into other gains and transferred into gain/loss in previous terms Adjusted amount transferred to initial amount of the target project 10 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Sub-total 4. Difference in translating of foreign currency accounts Less: Net amount of disposing overseas business and transferred to current gain/loss Sub-total 5. Others Less: Income tax influence by other accounted into other misc. incomes Net amount accounted into other misc. income and transferred into current gain/loss in previous terms Sub-total Total (VI) Reception of visiting, investigating, and communicating requests in the report term were as the followings Main content involved Time/date Place Way Type of visitors Visitors and material provided VII. Financial Report (I) Auditors’ opinions If the Interim Report is audited [] Yes [V] No (II) Financial Statements Consolidated or not [V] Yes [] No 1. Consolidated Balance Sheet Prepared by: Chongqing Jianshe Motorcycle Co., Ltd. In RMB Items Note Closing balance Openning balance Current asset: Monetary capital 424,021,851.27 190,637,204.06 Settlement provision Outgoing call loan Transactional financial assets Notes receivable 74,955,765.27 255,630,070.43 Account receivable 245,327,869.5 164,211,795.84 Prepayment 133,688,078.7 84,180,707.6 Insurance receivable Reinsurance receivable 11 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Provisions of Reinsurance contracts receivable Interest receivable Dividend receivable Other account receivable 20,982,177.64 20,812,821.83 Repurchasing of financial assets Inventories 331,879,039.56 327,646,526.59 Non-current asset due in 1 year Other current asset Total of current asset 1,230,854,781.94 1,043,119,126.35 Non-current assets Disburse of consigned loans Available-for-sale financial asset Expired investment in possess Long-term receivable Long-term share equity 665,102,655.51 661,109,026.54 investment Investment real estates Fixed assets 786,778,994.73 815,167,792.4 Construction in process 2,981,816.97 637,819.15 Engineering goods Fixed asset disposal Production physical assets Gas & petrol Intangible assets 110,056,439.74 114,167,766.09 R&D expense 45,218,941.4 40,642,012.19 Goodwill Long-term amortizable 10,841,938.77 11,958,171.84 expenses Differed income tax asset 3,695,408.84 3,695,408.84 Other non-current asset 1,020,000 1,224,000 Total of non-current assets 1,625,696,195.96 1,648,601,997.05 Total of assets 2,856,550,977.9 2,691,721,123.4 Current liabilities Short-term loans 797,762,191.98 886,432,513.1 Loan from Central Bank Deposit received and hold for others Call loan received Trade off financial liabilities Notes payable 585,306,600 182,052,500 Account payable 444,306,292.13 493,041,465.91 Prepayment received 57,161,800.61 90,848,770.88 Selling of repurchased financial assets Fees and commissions receivable 12 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Employees’ wage payable 417,466.62 1,295,690.87 Tax payable 120,341,858.64 122,045,251.33 Interest payable Dividend payable Other account payable 34,974,220.95 44,989,142.9 Reinsurance fee payable Insurance contract provision Entrusted trading of securities Entrusted selling of securities Non-current liability due in 1 273,400,000 115,400,000 year Other current liability Total of current liability 2,313,670,430.93 1,936,105,334.99 Non-current liabilities Long-term borrowings 287,000,000 466,700,000 Bond payable Long-term payable Special payable 738,000 738,000 Anticipated liabilities Differed income tax liability Other non-recurring liabilities Total of non-current liabilities 287,738,000 467,438,000 Total of liability 2,601,408,430.93 2,403,543,334.99 Owners’ equity (or shareholders’ equity) Capital paid in (or share 477,500,000 477,500,000 capital) Capital reserves 603,180,517.59 603,180,517.59 Less: Shares in stock Special reserves Surplus reserves 125,686,000 125,686,000 Common risk provision Retained profit -953,608,077.73 -919,900,424.03 Different of foreign currency translation Total of owner’s equity belong to 252,758,439.86 286,466,093.56 the parent company Minor shareholders’ equity 2,384,107.11 1,711,694.85 Total of owners’ equity (or 255,142,546.97 288,177,788.41 shareholders’ equity) Total of liability and shareholders’ 2,856,550,977.9 2,691,721,123.4 equity (or owners’ equity) Legal representative: Li Huaguang CFO: Teng Feng Accounting Manager: Liao Jian 2. Balance Sheet of the Parent Company In RMB Items Note Closing balance Openning balance 13 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Current asset: Monetary capital 202,432,397.34 95,112,079.64 Transactional financial assets Notes receivable 15,609,165.27 91,147,805.32 Account receivable 26,366,449.14 25,519,400.79 Prepayment 39,704,834.45 32,008,622.36 Interest receivable Dividend receivable Other account receivable 157,455,289.67 210,618,877.52 Inventories 75,685,410.23 68,804,889.8 Non-current asset due in 1 year Other current asset Total of current asset 517,253,546.1 523,211,675.43 Non-current assets Available-for-sale financial asset Expired investment in possess Long-term receivable Long-term share equity 813,897,611.81 810,107,982.84 investment Investment real estates Fixed assets 597,987,146.68 618,928,862.75 Construction in process 2,460,467.97 530,820.15 Engineering goods Fixed asset disposal Production physical assets Gas & petrol Intangible assets 88,099,250.3 91,938,540.79 R&D expense 45,218,941.4 40,642,012.19 Goodwill Long-term amortizable 2,654,506.77 3,079,034.88 expenses Differed income tax asset Other non-current asset Total of non-current assets 1,550,317,924.93 1,565,227,253.6 Total of assets 2,067,571,471.03 2,088,438,929.03 Current liabilities Short-term loans 538,500,000 695,720,000 Trade off financial liabilities Notes payable 247,850,000 Account payable 401,934,902.35 451,497,827.87 Prepayment received 4,798,082.25 13,682,056.79 Employees’ wage payable 267,455.17 738,942.92 Tax payable 118,535,257.1 128,821,934.36 Interest payable Dividend payable Other account payable 81,969,425.02 76,348,143.67 14 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Non-current liability due in 1 185,500,000 17,000,000 year Other current liability Total of current liability 1,579,355,121.89 1,383,808,905.61 Non-current liabilities Long-term borrowings 93,000,000 271,500,000 Bond payable Long-term payable Special payable 738,000 738,000 Anticipated liabilities Differed income tax liability Other non-recurring liabilities Total of non-current liabilities 93,738,000 272,238,000 Total of liability 1,673,093,121.89 1,656,046,905.61 Owners’ equity (or shareholders’ equity) Capital paid in (or share 477,500,000 477,500,000 capital) Capital reserves 601,240,294.29 601,240,294.29 Less: Shares in stock Special reserves Surplus reserves 125,686,000 125,686,000 Retained profit -809,947,945.15 -772,034,270.87 Different of foreign currency translation Total of owners’ equity (or 394,478,349.14 432,392,023.42 shareholders’ equity) Total of liability and shareholders’ equity (or owners’ 2,067,571,471.03 2,088,438,929.03 equity) 3. Consolidated Income Statement In RMB Items Note Amount of the Current Term Amount of the Previous Term I. Total revenue 968,858,593.63 1,371,442,562.5 Incl. Business income 968,858,593.63 1,371,442,562.5 Interest income Insurance fee earned Fee and commission received II. Total business cost 1,021,906,634.08 1,396,576,936.65 Incl. Business cost 814,535,168.88 1,187,779,750.98 Interest expense Fee and commission paid Insurance discharge payment Net claim amount paid Net insurance policy 15 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary reserves provided Insurance policy dividend paid Reinsurance expenses Business tax and 11,529,258.24 18,305,481.31 surcharge Sales expense 61,805,964.91 73,664,530.5 Administrative expense 70,934,694.54 77,855,241.42 Financial expenses 58,650,249.34 35,548,776.33 Asset impairment loss 4,451,298.17 3,423,156.11 Plus: gains from change of fair value (“-“ for loss) Investment gains 19,789,628.97 24,048,088.9 (“-“ for loss) Incl. Investment gains 20,293,033.8 24,551,493.73 from affiliates Exchange gains (“-“ for loss) III. Operational profit (“-“ for loss) -33,258,411.48 -1,086,285.25 Plus: non-operational income 380,369.83 1,627,284.19 Less: non-operational 157,199.79 500,520.28 expenditure Incl. Loss from disposal 73,623.94 34,263.43 of non-current assets IV. Gross profit (“-“ for loss) -33,035,241.44 40,478.66 Less: Income tax expenses -760,147.53 V. Net profit (“-“ for net loss) -33,035,241.44 800,626.19 Including: Net profit realized by the entity taken over before the takover Net profit attributable to the -33,707,653.7 1,364,363.06 owners of parent company Minor shareholders’ equity 672,412.26 -563,736.87 VI. Earnings per share: -- -- (I) Basic earnings per share -0.0706 0.0029 (II) Diluted earnings per share -0.0706 0.0029 VII. Other misc. incomes VIII. Total of misc. incomes Total of misc. incomes attributable to the owners of the -33,707,653.7 1,364,363.06 parent company Total misc gains attributable to 672,412.26 -563,736.87 the minor shareholders If there are entities merged under common control, their net profit realized before th merger were totaled to RMB. Legal representative: Li Huaguang CFO: Teng Feng Accounting Manager: Liao Jian 4. Income Statement of the Parent Co. In RMB Items Note Amount of the Current Term Amount of the Previous Term I. Turnover 984,607,056.86 869,013,591.47 16 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Less: Operation cost 930,917,606.93 786,669,103.83 Business tax and 9,970,504.17 16,158,602.42 surcharge Sales expense 10,544,518.21 14,753,048.4 Administrative expense 53,528,756.14 38,914,464.32 Financial expenses 36,996,624.26 26,163,060.43 Asset impairment loss 558,876.57 1,100,437.19 Plus: gains from change of fair value (“-“ for loss) Investment gains (“-“ for 19,789,628.97 24,048,088.9 loss) Incl. Investment gains 20,293,033.8 24,551,493.73 from affiliates II. Operational profit (“-“ for loss) -38,120,200.45 9,302,963.78 Plus: Non business income 219,216.35 1,375,977.59 Less: Non-business expenses 12,690.18 153,315.43 Incl. Loss from disposal 8,938.4 of non-current assets III. Total profit (“-“ for loss) -37,913,674.28 10,525,625.94 Less: Income tax expenses -165,065.58 IV. Net profit (“-“ for net loss) -37,913,674.28 10,690,691.52 V. Earnings per share -- -- (I) Basic earnings per share -0.08 0.02 (II) Diluted earnings per share -0.08 0.02 VI. Other misc gains VII. Total of integrated income -37,913,674.28 10,690,691.52 5. Consolidated Cash Flow Statement In RMB Items Amount of the Current Term Amount of the Previous Term I. Net cash flow from business operation Cash received from sales of 584,202,387.98 1,004,125,594.48 products and providing of services Net increase of customer deposits and capital kept for brother company Net increase of loans from central bank Net increase of inter-bank loans from other financial bodies Cash received against original insurance contract Net cash received from reinsurance business Net increase of client deposit and investment Net increase of trade financial asset disposal Cash received as interest, processing fee, and commission 17 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Net increase of inter-bank fund received Net increase of repurchasing business Tax returned 6,546,244.41 11,118,487.53 Other cash received from business 5,143,315.69 7,650,196.61 operation Sub-total of cash inflow from business 595,891,948.08 1,022,894,278.62 activities Cash paid for purchasing of 463,639,185.92 855,773,303.08 merchandise and services Net increase of client trade and advance Net increase of savings in central bank and brother company Cash paid for original contract claim Cash paid for interest, processing fee and commission Cash paid for policy dividend Cash paid to staffs or paid for 102,231,217.82 101,859,179.83 staffs Taxes paid 28,642,320.15 45,547,207.49 Other cash paid for business 42,427,738.45 51,582,896.87 activities Sub-total of cash outflow from business 636,940,462.34 1,054,762,587.27 activities Cash flow generated by business -41,048,514.26 -31,868,308.65 operation, net II. Cash flow generated by investing Cash received from investment retrieving Cash received as investment profit 16,000,000 11,000,000 Net cash retrieved from disposal of fixed assets, intangible assets, and other 3,721.35 14,869.04 long-term assets Net cash received from disposal of subsidiaries or other operational units Other investment-related cash 8,035,069.11 1,258,801.19 received Sub-total of cash inflow due to 24,038,790.46 12,273,670.23 investment activities Cash paid for construction of fixed assets, intangible assets and other 34,134,994.9 14,932,612.53 long-term assets Cash paid as investment 10,000,000 Net increase of loan against pledge Net cash received from subsidiaries and other operational units Other cash paid for investment 20,855,546.38 activities Sub-total of cash outflow due to 34,134,994.9 45,788,158.91 investment activities Net cash flow generated by investment -10,096,204.44 -33,514,488.68 18 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary III. Cash flow generated by financing Cash received as investment Incl. Cash received as investment from minor shareholders Cash received as loans 748,024,001.92 1,030,720,000 Cash received from bond placing Other financing-related cash 367,350,408.84 795,533,127.24 received Subtotal of cash inflow from financing 1,115,374,410.76 1,826,253,127.24 activities Cash to repay debts 864,774,861.5 308,450,000 Cash paid as dividend, profit, or 54,948,383.96 184,108,283.25 interests Incl. Dividend and profit paid by subsidiaries to minor shareholders Other cash paid for financing 160,919,769.62 1,316,018,251.24 activities Subtotal of cash outflow due to 1,080,643,015.08 1,808,576,534.49 financing activities Net cash flow generated by financing 34,731,395.68 17,676,592.75 IV. Influence of exchange rate 187,514.56 -753,290.07 alternation on cash and cash equivalents V. Net increase of cash and cash -16,225,808.46 -48,459,494.65 equivalents Plus: Balance of cash and cash 161,078,406.88 248,884,345.21 equivalents at the beginning of term VI. Balance of cash and cash 144,852,598.42 200,424,850.56 equivalents at the end of term 6. Cash Flow Statement of the Parent Co. In RMB Items Amount of the Current Term Amount of the Previous Term I. Net cash flow from business operation Cash received from sales of 498,515,072.48 662,647,162.18 products and providing of services Tax returned 3,518,656.47 6,176,961.92 Other cash received from business 1,590,221.08 2,380,454.13 operation Sub-total of cash inflow from business 503,623,950.03 671,204,578.23 activities Cash paid for purchasing of 426,118,461.86 661,091,330.53 merchandise and services Cash paid to staffs or paid for 78,878,864.63 79,187,793.49 staffs Taxes paid 15,462,766.01 20,047,186.05 Other cash paid for business 10,880,852.43 19,731,587.19 activities Sub-total of cash outflow from business 531,340,944.93 780,057,897.26 activities Cash flow generated by business -27,716,994.9 -108,853,319.03 operation, net 19 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary II. Cash flow generated by investing Cash received from investment retrieving Cash received as investment profit 16,000,000 11,000,000 Net cash retrieved from disposal of fixed assets, intangible assets, and other 6,410.26 long-term assets Net cash received from disposal of subsidiaries or other operational units Other investment-related cash 8,005,552.48 457,995.75 received Sub-total of cash inflow due to 24,005,552.48 11,464,406.01 investment activities Cash paid for construction of fixed assets, intangible assets and other 32,739,135.67 11,489,095.82 long-term assets Cash paid as investment 10,000,000 Net cash received from subsidiaries and other operational units Other cash paid for investment 20,128,000 activities Sub-total of cash outflow due to 32,739,135.67 41,617,095.82 investment activities Net cash flow generated by investment -8,733,583.19 -30,152,689.81 III. Cash flow generated by financing Cash received as investment Cash received as loans 568,500,000 898,220,000 Other financing-related cash 1,236,001,035.11 1,802,966,824.12 received Subtotal of cash inflow from financing 1,804,501,035.11 2,701,186,824.12 activities Cash to repay debts 741,500,795.56 308,450,000 Cash paid as dividend, profit, or 31,425,641.98 174,016,143.41 interests Other cash paid for financing 972,904,136.98 2,089,783,422.9 activities Subtotal of cash outflow due to 1,745,830,574.52 2,572,249,566.31 financing activities Net cash flow generated by financing 58,670,460.59 128,937,257.81 IV. Influence of exchange rate 424.99 -585,600.54 alternation on cash and cash equivalents V. Net increase of cash and cash 22,220,307.49 -10,654,351.57 equivalents Plus: Balance of cash and cash 92,026,931.24 166,262,402.29 equivalents at the beginning of term VI. Balance of cash and cash 114,247,238.73 155,608,050.72 equivalents at the end of term 7. Statement of Change in Owners’ Equity (Consolidated) Amount of the Current Term In RMB Items Amount of the Current Term 20 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Owners’ Equity Attributable to the Parent Company Capital Minor Commo Total of paid in Less: sharehold Capital Special Surplus n risk Retaine owners’ (or Shares Others ers’ reserves reserves reserves provisio d profit equity share in stock equity n capital) I. Balance at the end of last 477,500 603,180, 125,686 -919,90 1,711,694. 288,177,78 year ,000 517.59 ,000 0,424.03 85 8.41 Plus: Change of accounting policy Correcting of previous errors Others II. Balance at the beginning of 477,500 603,180, 125,686 -919,90 1,711,694. 288,177,78 current year ,000 517.59 ,000 0,424.03 85 8.41 III. Amount of change in -33,707, 672,412.2 -33,035,24 current term (“-“ for decrease) 653.7 6 1.44 -33,707, 672,412.2 -33,035,24 (I) Net profit 653.7 6 1.44 (II) Other misc. income -33,707, 672,412.2 -33,035,24 Total of (I) and (II) 653.7 6 1.44 (III) Investment or decreasing of capital by owners 1. Capital inputted by owners 2. Amount of shares paid and accounted as owners’ equity 3. Others (IV) Profit allotment 1. Providing of surplus reserves 2. Common risk provision 3. Allotment to the owners (or shareholders) 4. Others (V) Internal transferring of owners’ equity 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3. Making up losses by surplus reserves 4. Others (VI) Special reserves 1. Provided this year 2. Used this term (VII) Others IV. Balance at the end of this 477,500 603,180, 125,686 -953,60 2,384,107 255,142,54 term ,000 517.59 ,000 8,077.73 .11 6.97 Amount of Last Year In RMB Items Amount of Last Year 21 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Owners’ Equity Attributable to the Parent Company Capital Minor Commo Total of paid in Less: sharehold Capital Special Surplus n risk Retaine owners’ (or Shares Others ers’ reserves reserves reserves provisio d profit equity share in stock equity n capital) I. Balance at the end of last 477,500 603,180, 125,686 -731,45 2,439,932 477,348,51 year ,000 517.59 ,000 7,938.07 .61 2.13 Plus: Retrospective adjustment caused by merger of entities under common control Plus: Change of accounting policy Correcting of previous errors Others II. Balance at the beginning of 477,500 603,180, 125,686 -731,45 2,439,932 477,348,51 current year ,000 517.59 ,000 7,938.07 .61 2.13 III. Amount of change in 1,364,36 -563,736. 800,626.19 current term (“-“ for decrease) 3.06 87 1,364,36 -563,736. (I) Net profit 800,626.19 3.06 87 (II) Other misc. income 1,364,36 -563,736. Total of (I) and (II) 800,626.19 3.06 87 (III) Investment or decreasing of capital by owners 1. Capital inputted by owners 2. Amount of shares paid and accounted as owners’ equity 3. Others (IV) Profit allotment 1. Providing of surplus reserves 2. Common risk provision 3. Allotment to the owners (or shareholders) 4. Others (V) Internal transferring of owners’ equity 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3. Making up losses by surplus reserves 4. Others (VI) Special reserves 1. Provided this year 2. Used this term (VII) Others IV. Balance at the end of this 477,500 603,180, 125,686 -919,90 1,711,694. 288,177,78 term ,000 517.59 ,000 0,424.03 85 8.41 22 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary 8. Statement of Change in Owners’ Equity (Parent Co.) Amount of the Current Term In RMB Amount of the Current Term Capital Items Less: Common Total of paid in (or Capital Special Surplus Retained Shares in risk owners’ share reserves reserves reserves profit stock provision equity capital) 477,500,00 601,240,29 125,686,00 -605,391,4 599,034,84 I. Balance at the end of last year 0 4.29 0 45.5 8.79 Plus: Change of accounting policy Correcting of previous errors Others II. Balance at the beginning of 477,500,00 601,240,29 125,686,00 -772,034,2 432,392,02 current year 0 4.29 0 70.87 3.42 III. Amount of change in current -37,913,67 -37,913,67 term (“-“ for decrease) 4.28 4.28 -37,913,67 -37,913,67 (I) Net profit 4.28 4.28 (II) Other misc. income -37,913,67 -37,913,67 Total of (I) and (II) 4.28 4.28 (III) Investment or decreasing of capital by owners 1. Capital inputted by owners 2. Amount of shares paid and accounted as owners’ equity 3. Others (IV) Profit allotment 1. Providing of surplus reserves 2. Common risk provision 3. Allotment to the owners (or shareholders) 4. Others (V) Internal transferring of owners’ equity 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3. Making up losses by surplus reserves 4. Others (VI) Special reserves 1. Provided this year 2. Used this term (VII) Others IV. Balance at the end of this 477,500,00 601,240,29 125,686,00 -809,947,9 394,478,34 term 0 4.29 0 45.15 9.14 23 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary Amount of Last Year In RMB Amount of Last Year Capital Total of Items Less: Common paid in (or Capital Special Surplus Retained Shares in risk owners’ share reserves reserves reserves profit stock provision equity capital) 477,500,00 601,240,29 125,686,00 -616,082,1 588,344,15 I. Balance at the end of last year 0 4.29 0 37.02 7.27 Plus: Change of accounting policy Correcting of previous errors Others II. Balance at the beginning of 477,500,00 601,240,29 125,686,00 -616,082,1 588,344,15 current year 0 4.29 0 37.02 7.27 III. Amount of change in current 10,690,691 10,690,691 term (“-“ for decrease) .52 .52 10,690,691 10,690,691 (I) Net profit .52 .52 (II) Other misc. income 10,690,691 10,690,691 Total of (I) and (II) .52 .52 (III) Investment or decreasing of capital by owners 1. Capital inputted by owners 2. Amount of shares paid and accounted as owners’ equity 3. Others (IV) Profit allotment 1. Providing of surplus reserves 2. Common risk provision 3. Allotment to the owners (or shareholders) 4. Others (V) Internal transferring of owners’ equity 1. Capitalizing of capital reserves (or to capital shares) 2. Capitalizing of surplus reserves (or to capital shares) 3. Making up losses by surplus reserves 4. Others (VI) Special reserves 1. Provided this year 2. Used this term (VII) Others IV. Balance at the end of this 477,500,00 601,240,29 125,686,00 -605,391,4 599,034,84 term 0 4.29 0 45.5 8.79 24 Chongqing Jianshe Motorcycle Co., Ltd. Interim Report 2012 Summary (III) Notes to the financial statements 1. Influences of changes in material accounting policies, accounting estimations, or correction of material accounting error (1) Change of accounting policies Is there any change in accounting policies in the report period [] Yes [V] No (2) Change of accounting estimations Is there any change in accounting estimations in the report period [] Yes [V] No (3) Correcting of accounting errors Is there any accounting error with previous period found in the report period [] Yes [V] No 2. Statement on change of consolidation range 3. If the certified public accounts has issued a non-standard auditor’s report, list the relevant notes to the issues involved in the report. 25