The Third Quarterly Report 2017 Guangdong Electric Power Development Co., Ltd. The Third Quarterly Report 2017 October 2017 1 The Third Quarterly Report 2017 1 Important notes The Board of Directors,the Supervisory Committee, the directors, the supervisors, and executives of the Company guarantee that there are no significant omissions, fictitious or misleading statements carried in the Quarterly Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness of the Quarterly Report. All of the directors presented the board meeting at which this Quarterly Report was examined. Mr. Huang Zhenhai, Person in charge of the Company, Mr.Liu Wei , Person in charge of accounting works, Mr.Meng Fei ,CFO as well as person in charge of accounting institution represent and warrant the financial and accounting report in the third quarterly report is true and complete. 2 The Third Quarterly Report 2017 II. Basic Information of the Company I.Main accounting data and financial Index Whether it has retroactive adjustment or re-statement on previous accounting data for accounting policy changed and accounting error correction or not. □ Yes √ No As at the end of the reporting Changed (%)over end of As at the end of last year period prev. year Gross assets(RMB) 70,981,629,233.00 70,677,003,760.00 0.43% Net assets attributable to the shareholders of the listed company 23,741,518,453.00 23,378,847,225.00 1.55% (RMB) Increase/decrease over Between beginning of Changed (%)over Reporting period the same period of last the year to the end of end of prev. year year(%) the report period Operating income(RMB) 7,546,970,420.00 21.58% 19,932,456,997.00 21.23% Net profit attributable to the shareholders of the listed company 653,326,357.00 -11.50% 782,062,082.00 -47.03% (RMB) Net profit after deducting of non-recurring gain/loss attributable 642,264,511.00 -13.74% 799,067,242.00 -46.30% to the shareholders of listed company(RMB) Cash flow generated by business -- -- 3,368,415,745.00 -58.16% operation, net(RMB) Basic earning per 0.124 -11.43% 0.149 -46.98% share(RMB/Share) Diluted gains per 0.124 -11.43% 0.149 -46.98% share(RMB/Share)(RMB/Share) Weighted average return on 2.79% -0.34% 3.24% -2.94% equity(%) Items and amount of non-current gains and losses √ Applicable □ Not applicable In RMB Items Amount (Year-beginning to the Notes 3 The Third Quarterly Report 2017 end of the report period.) Non-current asset disposal gain/loss(including the write-off part for which assets impairment -607,211.00 provision is made) Govemment subsidy recognized in current gain and loss(excluding those closely related to the 14,710,020.00 Company’s business and granted under the state’s policies) Guangqian company received the Decisions on Handling of the Tax Affairs (SGSJC[2017] No.0013) issued by the Inspection Department Effect on current gains/losses when a one-off of Shenzhen Municipal Office, SAT on June 26, adjustment is make to current gains/losses -27,450,327.00 2017, which requires Guangqian company to pay according to requirements of taxation. VAT and overdue fees(late fee of RMB 27.4503 million occurred). Such decisions are under negotiation among several parties at present. Other non-business income and expenditures -3,532,238.00 other than the above Less: Amount of influence of income tax 374,180.00 Influenced amount of minor shareholders’ -248,776.00 equity (after tax) Total -17,005,160.00 -- For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses and its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as recurring gains and losses, it is necessary to explain the reason. □ Applicable√ Not applicable None of Non-recurring gain /loss items recorgnized as recurring gain /loss/items as defined by the information disclosure explanatory Announcement No.1- Non –recurring gain/loss in the report period. 4 The Third Quarterly Report 2017 II. Total number of shareholders at the period-end and shareholdings of top 10 shareholders 1. About Total Common Shareholders, Total Preference Shareholders with the Voting Power Recovered and the Shares Held by Top Ten Common Shareholders In shares Total preference shareholders with the Total number of common 103,838 voting power recovered at the end of the 0 shareholders at the period-end reporting period(if any) Shares held by the top 10 shareholders Share Amount of tradable Pledging or freezing Properties of Shareholder name proportion Quantity shares with Status of the shareholder Quantity % Conditional held shares Guangdong Yudean Group Co., State-owned legal 67.39% 3,538,005,285 1,893,342,621 Ltd. person China Securities Finance Co., State-owned legal 2.78% 145,748,980 Ltd. person Guangdong Guangfa Electric State-owned legal 2.22% 116,693,602 Power Investment Co., Ltd. person Guangdong Electric Power State-owned legal 1.80% 94,367,341 Development Corporation person Domestic Non-State Harbin Hali Industry Co., Ltd. 0.71% 37,405,712 owned legal person Domestic Natural Li Zhuo 0.59% 31,009,743 person Harbin Daoli District Charity Domestic Non-State 0.52% 27,529,778 Foundation owned legal person National Social National Social Security Fund Security Fund 103 0.42% 21,994,982 103 portfolio portfolio Domestic Natural Zheng Jianxiang 0.35% 18,453,452 person BBH A/C VANGUARD EMERGING MARKETS Overseas Legal person 0.32% 16,613,688 STOCK INDEX FUND Shareholding of top 10 shareholders of unrestricted shares Quantity of unrestricted Share type Name of the shareholder shares held at the end of the Share type Quantity reporting period Guangdong Yudean Group Co., Ltd. 1,644,662,664 RMB Common shares 1,644,662,664 China Securities Finance Co., Ltd. 145,748,980 RMB Common shares 145,748,980 Guangdong Guangfa Electric Power Investment Co., 116,693,602 RMB Common shares 116,693,602 Ltd. 5 The Third Quarterly Report 2017 Guangdong Electric Power Development Corporation 94,367,341 RMB Common shares 94,367,341 Harbin Hali Industry Co., Ltd. 37,405,712 RMB Common shares 37,405,712 Li Zhuo 31,009,743 RMB Common shares 21,362,585 Harbin Daoli District Charity Foundation 27,529,778 RMB Common shares 27,529,778 National Social Security Fund 103 portfolio 21,994,982 RMB Common shares 21,994,982 Foreign shares placed in Zheng Jianxiang 18,453,452 18,453,452 domestic exchange BBH A/C VANGUARD EMERGING MARKETS Foreign shares placed in 16,613,688 16,613,688 STOCK INDEX FUND domestic exchange The fourth largest shareholder Guangdong Electric Power Development Explanation on shareholders participating in the margin Corporation is the wholly-owned subsidiaries of the largest shareholder trading business Yudean Group. These two companies have relationships; whether the other shareholders have relationships or unanimous acting was unknown. The Fifth largest shareholder Harbin Hali Industry Co., Ltd. holds 28,202,907 A shares of the Company through stock account with credit transaction and guarantee and holds 9,202,805 A shares through ordinary stock account, holds 37,405,712 shares of the Company's stock totally. The sixth largest shareholder Li Zhuo. holds 30,930,123 A shares of the Participation of top 10 unconditional common share Company through stock account with credit transaction and guarantee and shareholders in securities margin trading (if any) holds 79,620 A shares through ordinary stock account, holds 31,009,743 shares of the Company's stock totally. The seventh largest shareholder Harbin Daoli District Charity Foundation. holds 27,392,378 A shares of the Company through stock account with credit transaction and guarantee and holds 137,400 A shares through ordinary stock account, holds 27,529,778 shares of the Company's stock totally. Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period. □ Yes √ No The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company have no buy –back agreement dealing in reporting period. 2.Total number of preferred shareholders and shareholding of top 10 preferred shareholders by the end of the report period □ Applicable √Not applicable 6 The Third Quarterly Report 2017 III. Significant Events I. Particular about large-margin change of main accounting statement item and financial index and its reason. √ Applicable □ Not applicable During the reporting period, the net profit attributable to shareholders of the listed company decreased by 47.03% year on year, which is mainly due to the acceleration of the marketization of electricity market and the intensification of market competition, the sharp drop of the company's on-grid electricity price and the sustained high coal price. Based on the above factors, the company's net profit fell sharply year on year. During the reporting period, the net cash flow arising from operating activities decreased by 58.16% year-on-year, which is mainly due to the sustained high coal price and the significant increase in the cash payment for purchasing goods and receiving labor services, resulting in the decrease in the net cash flow from operating activities. II. The progress of significant events and influence, as well as the analysis and explanation on resolving proposal. □ Applicable √Not applicable III. Commitments finished in implementation by the Company, shareholders, actual controller, acquirer, directors, supervisors, senior executives or other related parties in the reporting period and commitments unfinished in implementation at the end of the reporting period □ Applicable √Not applicable There are no commitments that the company, shareholders, actual controller, acquirer, directors, supervisors, senior executives or other related parties have fulfilled during the reporting period and have not yet fulfilled by the end of reporting period. IV.Prediction of Business performance for 2017 Estimation of accumulative net profit from the beginning of the year to the end of next report period to be loss probably or the warning of its material change compared with the corresponding period of the last year and explanation of reason. □ Applicable√ Not applicable V. Securities investment √ Applicable □Not applicable Mode of Book Changes Cumulat Purchas Sale Gain/los Book Stock Initial Account Source Security Security accounti value in fair ive fair e amount s of the value Abbrevi investm ing of the category code ng balance value of value amount in the reportin balance ation: ent cost items shares measure at the the this changes in the this g period at the 7 The Third Quarterly Report 2017 ment beginni period in this period end of ng of equity period the the reportin reportin g period g period Financia Domesti Fair Shenzhe l assets c and 15,890, value 86,562, -5,292,0 65,829, 1,890,0 81,270, Own-Fu 000027 n 0.00 0.00 availabl foreign 628.00 measure 000.00 00.00 372.00 00.00 000.00 nds Energy e for stocks ment sales Financia Domesti Fair l assets c and Shenerg 235,837 value 325,974 4,997,9 95,134, 12,217, 330,972 Own-Fu 600642 0.00 0.00 availabl foreign y ,988.00 measure ,308.00 02.00 222.00 095.00 ,210.00 nds e for stocks ment sales Financia Domesti Fair l assets c and 3,600,0 value 7,200,0 1,080,0 4,680,0 234,000 8,280,0 Own-Fu 831039 NEEQ 0.00 0.00 availabl foreign 00.00 measure 00.00 00.00 00.00 .00 00.00 nds e for stocks ment sales 255,328 419,736 785,902 165,643 14,341, 420,522 Total -- 0.00 0.00 -- -- ,616.00 ,308.00 .00 ,594.00 095.00 ,210.00 Disclosure date for the notice of approval by the Board (If any) Disclosure date for the notice of approval by shareholders’ Meeting (If any) VI. Investment in derivatives □ Applicable √Not applicable There is no derivative investment during the report period. VII. Registration form of such Activities as Reception, Research, Communication, Interview in the Reporting Period √Applicable □Not applicable Reception time Way of reception Types of visitors Basic index Details can be found in the Record Chart of the Investor January 12,2017 Onsite investigation Organization Relation Activity disclosed on Juchao website(www.cninfo.com.cn) on 16 January .2017. Details can be found in the Record Chart of the Investor March 23,2017 Onsite investigation Organization Relation Activity disclosed on Juchao 8 The Third Quarterly Report 2017 website(www.cninfo.com.cn) on 24 March 2017. Details can be found in the Record Chart of the Investor September 7,2017 Onsite investigation Organization Relation Activity disclosed on Juchao website(www.cninfo.com.cn) on 11 September 2017. Details can be found in the Record Chart of the Investor September 29,2017 Onsite investigation Organization Relation Activity disclosed on Juchao website(www.cninfo.com.cn) on 29 September 2017. VIII. External guarantee get out of line □ Applicable √Not applicable The Company has no external guarantee get out of the line in the Period IX. Controlling shareholder and its related parties occupying non-business capital of the listed company □ Applicable √Not applicable There are no controlling shareholder and its related parties occupying non-business capital of the listed company in Period X.Implementation of the social Responsibility of taking targeted measures to alleviate poverty in light of local Conditions. (1)The third Quarter poverty relieving summary In the report period, the company continues implementing Guangdong scheme of “three-year crucial goals for the target poverty alleviation” and organizes the manpower, materials and financial resources into the poverty alleviation. The six subsidiaries carry out the targeted poverty alleviation and oriented assistance work subject to the formulated poverty alleviation work plan, which include Yuejiang company, Red Bay company, Jinghai company, Zhenneng company, Zhanjiang company and Dapu company, etc. (2)Information of the listed company’s in the third Quarter work in targeted poverty alleviation Measurement Index Quantity / Status unit I. General situation —— —— Thereinto: 1.Capital RMB’0000 32.39 2. Cash supplies RMB’0000 3.38 3. Ecological protection to poverty alleviation Person 139 (3)Subsequent targeted poverty alleviation program The company and holding subsidiaries will continue implementing relevant provincial, municipal and town provisions on the targeted poverty alleviation and find out the accurate ways for the targeted poverty alleviation 9 The Third Quarterly Report 2017 based on the local conditions. Firstly, insist the party and style construction, promote the ideological building of the assistance object village “two committees” members and intensify the results of “two studies and one action” learning activity. Secondly, insist study and improve capacity, insist the thorough learning on the spirit of Xi Jinping series important speeches, the spirit of relevant targeted poverty alleviation papers, the village business knowledge and the way to communicate with the public and improve further the work capacity for people. Thirdly, intensify the key points and promote the implementation, each poverty alleviation work team will continue focusing on the targeted poverty alleviation, grasp the poverty alleviation central work and coordinate overall and implement relevant work. For the poor households poverty alleviation projects and village group projects listed in the filing and issuing cards, obtain positively support from relevant authority subject to the formulated target tasks, assist the assistance object villages and poor households in implementing the poverty alleviation projects and guarantee the overall completion of the poverty alleviation target tasks in the practical style. 10 The Third Quarterly Report 2017 IV. Financial Statement I. Financial statement 1. Consolidated balance sheet Prepared by: Guangdong Electric Power Development Co., Ltd. September 30,2017 In RMB Items At the end of term Beginning of term Current asset: Cash and bank balances 5,044,352,779.00 5,184,873,650.00 Settlement provision Outgoing call loan Financial assets at fair value through profit or loss Derivative financial assets Notes receivable Account receivable 3,081,857,781.00 2,776,061,909.00 Advance payments 910,240,253.00 1,064,822,122.00 Insurance receivable Reinsurance receivable Provisions of Reinsurance contracts receivable Interest receivable 13,184,201.00 16,681,118.00 Dividend receivable Other account receivable 161,899,777.00 133,499,956.00 Securities purchased under agreements to resell Inventories 1,600,497,054.00 1,513,153,241.00 Held-for-sale assets Current portion of non-current assets 58,322,683.00 Other current asset 908,304,228.00 882,055,591.00 Total of current assets 11,778,658,756.00 11,571,147,587.00 Non-current assets: Loans and advances 11 The Third Quarterly Report 2017 Available-for-sale financial assets 1,280,173,896.00 1,279,387,994.00 Held-to-maturity investments Long-term receivable 82,259,912.00 136,075,412.00 Long term share equity investment 5,717,918,665.00 5,432,637,750.00 Property investment 8,455,538.00 8,932,237.00 Fixed assets 39,823,939,594.00 41,814,685,521.00 Construction in progress 9,266,805,586.00 6,343,293,763.00 Engineering material 1,520,740.00 1,496,854.00 Fixed assets pending for disposal 7,317,945.00 4,304,229.00 Productive biological assets Gas & petrol Intangible assets 1,671,805,085.00 1,707,490,221.00 Research and Development Expenditures 494,017.00 Goodwill 27,486,780.00 27,486,780.00 Long-term prepaid expenses 28,638,368.00 34,611,712.00 Deferred income tax 378,337,007.00 303,929,269.00 Other non-current asset 907,817,344.00 2,011,524,431.00 Total of non-current assets 59,202,970,477.00 59,105,856,173.00 Total of assets 70,981,629,233.00 70,677,003,760.00 Current liabilities Short-term bank loan facilities 8,552,000,000.00 5,758,860,000.00 Borrowings from central bank Deposits and placements from other financial institutions Placement from banks and other financial institution Financial liabilities at fair value through profit and loss Derivative financial liabilities Notes payable 519,220,263.00 1,330,480,837.00 Account payable 2,298,276,196.00 3,167,250,446.00 Advances from customers 393,549.00 12,456,360.00 Securities sold under agreement to repurchase Fees and commissions payable 12 The Third Quarterly Report 2017 Payroll payable 251,696,877.00 144,122,128.00 Taxes and surcharges payable 535,967,608.00 326,919,844.00 Interest payable 149,256,385.00 83,648,793.00 Dividend payable 9,703,930.00 9,703,930.00 Other payable 3,916,870,664.00 3,292,556,995.00 Reinsurance amounts payable Provision of insurance contract Securities brokering Securities underwriting Held-for-sale liabilities Current portion of non-current liabilities 1,981,452,795.00 1,433,644,523.00 Other current liability 93,624,959.00 1,723,070,000.00 Total of current liability 18,308,463,226.00 17,282,713,856.00 Non-current liabilities: Long-term bank loan facilities 19,077,122,178.00 19,888,172,037.00 Bond payable 1,895,369,522.00 1,900,124,468.00 Including:preferred stock Perpetual capital securities Long-term payable 1,709,101,060.00 1,917,552,654.00 Long-term employee benefits payable 131,681,391.00 122,832,249.00 Grants payable 26,675,385.00 26,675,385.00 Provisions Deferred income 144,925,304.00 125,650,072.00 Deferred tax liabilities 24,627,476.00 37,718,277.00 Other non-current liabilities 39,000,000.00 Total non-current liabilities 23,009,502,316.00 24,057,725,142.00 Total of liability 41,317,965,542.00 41,340,438,998.00 Equity Share capital 5,250,283,986.00 5,250,283,986.00 Other equity instrument Including:preferred stock Perpetual capital securities Reserves 5,003,049,916.00 5,003,007,478.00 Less: treasury shares 13 The Third Quarterly Report 2017 Other comprehensive income 145,648,442.00 145,059,015.00 Specialized reserve Surplus reserves 7,590,363,724.00 6,845,001,818.00 General risk reserve Retained earnings 5,752,172,385.00 6,135,494,928.00 Equity contributable to parent company 23,741,518,453.00 23,378,847,225.00 Minority interests 5,922,145,238.00 5,957,717,537.00 Total equity 29,663,663,691.00 29,336,564,762.00 Total liabilities and equity 70,981,629,233.00 70,677,003,760.00 Legal Representative: Huang Zhenhai Person in charge of accounting:Liu Wei Accounting Dept Leader: Meng Fei 2.Parent Company Balance Sheet In RMB Items Year-end balance Year-beginning balance Current asset: Cash and bank balances 498,692,698.00 326,073,538.00 Financial assets at fair value through profit or loss Derivative financial assets Notes receivable Account receivable 219,526,419.00 212,343,198.00 Advance payments 56,799,400.00 79,990,745.00 Interest receivable 1,921,258.00 723,819.00 Dividend receivable Other receivable 67,433,901.00 122,933,749.00 Inventories 127,633,521.00 149,462,926.00 Held-for-sale assets Current portion of non-current assets Other current asset 25,650,427.00 Total of current assets 972,007,197.00 917,178,402.00 Non-current assets: Available-for-sale financial assets 1,280,173,896.00 1,279,387,994.00 Held-to-maturity investments Long-term receivable 351,460,000.00 335,000,000.00 14 The Third Quarterly Report 2017 Long term share equity investment 23,754,105,607.00 22,896,735,913.00 Property investment 8,455,538.00 8,932,237.00 Fixed assets 969,828,512.00 1,049,906,014.00 Construction in progress 126,531,759.00 43,039,781.00 Engineering material Fixed assets pending for disposal 850,936.00 Productive biological assets Gas & petrol Intangible assets 89,312,251.00 92,152,556.00 Research and Development Expenditures Goodwill Long-term prepaid expenses Deferred income tax 14,591,711.00 Other non-current asset 356,004,000.00 672,504,000.00 Total of non-current assets 26,951,314,210.00 26,377,658,495.00 Total of assets 27,923,321,407.00 27,294,836,897.00 Current liabilities Short-term bank loan facilities 1,600,000,000.00 300,000,000.00 Financial liabilities at fair value through profit and loss Derivative financial liabilities Notes payable Account payable 176,712,392.00 517,973,144.00 Advances from customers Payroll payable 51,379,012.00 31,813,417.00 Tax payable 3,995,417.00 9,688,606.00 Interest payable 45,419,314.00 48,091,022.00 Dividend payable 9,703,930.00 9,703,930.00 Other payable 98,047,412.00 93,522,121.00 Held-for-sale liabilities Current portion of non-current liabilities Other current liability 31,895,698.00 1,216,583,014.00 Total of current liability 2,017,153,175.00 2,227,375,254.00 Non-current liabilities: 15 The Third Quarterly Report 2017 Long-term bank loan facilities 1,500,000,000.00 1,500,000,000.00 Bond payable 1,197,697,262.00 1,196,982,619.00 Including:preferred stock Perpetual capital securities Long-term payable Long-term employee benefits payable 21,443,185.00 23,445,887.00 Grants payable Provisions Deferred income 58,818,228.00 59,533,388.00 Deferred income tax 12,508,093.00 Other non-current liabilities Total of Non-current liabilities 2,777,958,675.00 2,792,469,987.00 Total of liability 4,795,111,850.00 5,019,845,241.00 Equity Share capital 5,250,283,986.00 5,250,283,986.00 Other equity instrument Including:preferred stock Perpetual capital securities Reserves 5,605,794,603.00 5,605,752,163.00 Less: treasury shares Other comprehensive income 145,648,442.00 145,059,015.00 Specialized reserve Surplus reserves 7,590,363,724.00 6,845,001,818.00 Retained earnings 4,536,118,802.00 4,428,894,674.00 Total equity 23,128,209,557.00 22,274,991,656.00 负债和所有者权益总计 27,923,321,407.00 27,294,836,897.00 3.Consolidated Income statement of the Report period In RMB Items Amount in this period Amount in last period I. Revenue 7,546,970,420.00 6,207,318,559.00 Including: business revenue 7,546,970,420.00 6,207,318,559.00 Interest income 16 The Third Quarterly Report 2017 Premiums earned Fees and commissions income II. Total operating cost 6,583,694,398.00 5,171,188,129.00 Including: Cost of sales 6,050,271,305.00 4,594,220,998.00 Interest expense Fees and commissions expense Cash surrender amount Net expenses of claim settlement Net provisions for insurance contract reserves Policy dividend expenses Reinsurance expenses Business taxes and surcharges 59,774,483.00 51,461,297.00 Selling expenses 1,832,975.00 567,104.00 Administrative expense 147,840,859.00 176,112,019.00 Financial expenses 323,974,776.00 349,955,971.00 Impairment loss on assets -1,129,260.00 Add: Gain from fair-value changes(“-“for loss) Investment income(“-“for loss) 155,756,905.00 190,223,865.00 Including: investment income from 126,561,462.00 associates and joint ventures Gain on foreign exchange(“-“for loss) Other income 12,130,066.00 III. Operating profit(“-”for loss) 1,131,162,993.00 1,226,354,295.00 Add:Non-operating income 1,008,118.00 954,763.00 Including:Gains from disposal of 42,151.00 -130,677.00 non-current assets Less:Non business expenses 2,226,834.00 7,070,375.00 Incl:Loss from disposal of 1,261,954.00 non-current assets IV. Profit before tax(“-“for loss) 1,129,944,277.00 1,220,238,683.00 Less: Income tax expense 234,077,484.00 272,941,293.00 V. Net profit (“-“for net loss) 895,866,793.00 947,297,390.00 17 The Third Quarterly Report 2017 Net profit attributable to the owners of 653,326,357.00 738,187,983.00 parent company Minority interests 242,540,436.00 209,109,407.00 VI. Other comprehensive income after -16,334,224.00 3,661,960.00 tax Net of profit of other comprehensive income attributable to owners of the -16,334,224.00 3,661,960.00 parent company (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit pl ans of changes in net debt or net assets 2.Other comprehensive income under th e equity method investee can not be recl assified into profit or loss. (II) Other comprehensive income that will b -16,334,224.00 3,661,960.00 e reclassified into profit or loss. 1.Other comprehensive income under th e equity method investee can be reclassi fied into profit or loss. 2.Gains and losses from changes in fair -16,334,224.00 3,661,960.00 value available for sale financial assets 3.Held-to-maturity investments reclassif ied to gains and losses of available for s ale financial assets 4.The effective portion of cash flow hed ges and losses 5.Translation differences in currency fin ancial statements 6.Other Net after-tax of other comprehensive incom e attributable to Minority shareholders’ equity VII. Total comprehensive income 879,532,569.00 950,959,350.00 Total comprehensive income 636,992,133.00 741,849,943.00 18 The Third Quarterly Report 2017 attributable to the owner of the parent company Total comprehensive income 242,540,436.00 209,109,407.00 attributable minority shareholders VIII. Earnings per share (I)Basic earnings per share 0.124 0.14 (II)Diluted earnings per share 0.124 0.14 Legal Representative: Huang Zhenhai Person in charge of accounting:Li u Wei Accounting Dept Leader: Meng Fei 4.Income statement of the Parent Company of the Report period In RMB Items Amount in this period Amount in last period I.Revenue 583,577,531.00 622,332,773.00 Less:Business cost 547,228,007.00 460,750,721.00 Business tax and surcharge 933,096.00 4,652,331.00 Selling expenses 2,144.00 Administrative expense 19,815,701.00 22,267,139.00 Financial expenses 49,624,132.00 51,406,097.00 Impairment loss on assets Add: Gain from fair-value changes(“-“for loss) Investment income(“-“for loss) 260,702,725.00 284,325,421.00 Including: investment income from 126,394,835.00 associates and joint ventures Other income II. Operational profit(“-”for loss) 226,677,176.00 367,581,906.00 Add:Non-operating income 97,702.00 101,775.00 Including:Gains from disposal of non-current assets Less:Non-operating expenses 58,863.00 173,158.00 Incl:Loss from disposal of non-current assets III. Profit before tax(“-“for loss) 226,716,015.00 367,510,523.00 Less: Income tax expense -7,961,095.00 17,221,265.00 IV. Net profit (“-“for net loss) 234,677,110.00 350,289,258.00 19 The Third Quarterly Report 2017 V.Net of profit of other comprehensive i -16,334,224.00 3,661,960.00 ncome (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit pl ans of changes in net debt or net assets 2.Other comprehensive income under th e equity method investee can not be recl assified into profit or loss. ( II ) Other comprehensive income that will b -16,334,224.00 3,661,960.00 e reclassified into profit or loss. 1.Other comprehensive income under th e equity method investee can be reclassi fied into profit or loss. 2.Gains and losses from changes in fair -16,334,224.00 3,661,960.00 value available for sale financial assets 3.Held-to-maturity investments reclassif ied to gains and losses of available for s ale financial assets 4.The effective portion of cash flow hed ges and losses 5.Translation differences in currency fin ancial statements 6.Other VI. Total comprehensive income 218,342,886.00 353,951,218.00 VII. Earnings per share: (I)Basic earnings per share (II)Diluted earnings per share 5. Consolidated income statement between the beginning of the year and end of the report period In RMB Items Amount in this period Amount in last period I.Revenue 19,932,456,997.00 16,442,308,125.00 Including:Operating income 19,932,456,997.00 16,442,308,125.00 20 The Third Quarterly Report 2017 Interest income Insurance gained Commission charge and commission income II. Total operating cost 18,745,298,401.00 14,066,645,693.00 Including:Operating cost 17,176,961,296.00 12,362,131,227.00 Interest expense Commission chare and commission expense Insurance discharge payment Net claim amount paid Insurance policy dividend paid Insurance policy dividend paid Reinsurance expenses Business tax and surcharge 168,293,141.00 127,569,340.00 Selling expenses 4,621,433.00 1,303,572.00 Administrative expense 433,804,185.00 524,842,412.00 Financial expenses 961,618,346.00 1,051,928,402.00 Asset impairment loss -1,129,260.00 Add:Gains from change of fir value (“-”for loss) Investment gain(“-”for loss) 383,299,815.00 318,945,399.00 Incl: investment gains from affiliates 351,620,908.00 Gains from currency exchange(“-”for loss) Other income 19,480,274.00 III. Operational profit(“-”for loss) 1,589,938,685.00 2,694,607,831.00 Add:Non-business income 4,211,130.00 11,564,474.00 Incl:Gains from disposal of non-current 1,310,373.00 assets Less:Non business expenses 35,800,906.00 21,238,175.00 Incl:Loss from disposal of non-current 1,917,584.00 assets IV.Total profit(“-”for loss) 1,558,348,909.00 2,684,934,130.00 21 The Third Quarterly Report 2017 Less:Income tax expenses 382,769,307.00 688,423,363.00 V. Net profit(“-”for net loss) 1,175,579,602.00 1,996,510,767.00 Net profit attributable to the owners of 782,062,082.00 1,476,562,767.00 parent company Minority shareholders’ equity 393,517,520.00 519,948,000.00 VI. Net after-tax of Other 589,427.00 -104,286,232.00 comprehensive income Net after-tax of other comprehensive income attribut 589,427.00 -104,286,232.00 able to owners of the parent company. (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit pl ans of changes in net debt or net assets 2.Other comprehensive income under th e equity method investee can not be recl assified into profit or loss. (II) Other comprehensive income that will b 589,427.00 -104,286,232.00 e reclassified into profit or loss. 1.Other comprehensive income under th e equity method investee can be reclassi 970,838.00 fied into profit or loss. 2.Gains and losses from changes in fair 589,427.00 -105,257,070.00 value available for sale financial assets 3.Held-to-maturity investments reclassif ied to gains and losses of available for s ale financial assets 4.The effective portion of cash flow hed ges and losses 5.Translation differences in currency fin ancial statements 6.Other Net after-tax of other comprehensive incom e attributable to Minority shareholders’ 22 The Third Quarterly Report 2017 equity VII. Total comprehensive income 1,176,169,029.00 1,892,224,535.00 Total comprehensive income attributable to the owner of the parent 782,651,509.00 1,372,276,535.00 company Total comprehensive income 393,517,520.00 519,948,000.00 attributable minority shareholders VIII. Earnings per share (I)Basic earnings per share 0.149 0.281 (II)Diluted earnings per share 0.149 0.281 6.Income Statement of the Parent Between the Beginning of the Year and End of the Report Period In RMB Items Amount in this period Amount in last period I.Revenue 1,523,342,833.00 1,448,006,883.00 Less:Business cost 1,434,354,346.00 1,091,118,775.00 Business tax and surcharge 5,275,897.00 12,646,846.00 Selling expenses 6,733.00 9,300.00 Administrative expense 61,793,420.00 77,549,050.00 Financial expenses 147,728,499.00 163,432,962.00 Asset impairment loss Add:Gains from change of fir value (“-”for loss) Investment gain(“-”for loss) 1,371,179,896.00 2,137,470,736.00 Incl: investment gains from affiliates 347,799,688.00 Other income 1,576,903.00 II. Operational profit 1,246,940,737.00 2,240,720,686.00 Add:Non-business income 378,555.00 1,897,148.00 Incl:Gains from disposal of non-current assets Less:Non business expenses 254,204.00 531,243.00 Incl:Loss from disposal of non-current assets III.Total profit 1,247,065,088.00 2,242,086,591.00 Less:Income tax expenses -25,543,667.00 35,569,606.00 IV. Net profit 1,272,608,755.00 2,206,516,985.00 23 The Third Quarterly Report 2017 V. Net after-tax of Other comprehensive 589,427.00 -104,286,232.00 income (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit pl ans of changes in net debt or net assets 2.Other comprehensive income under th e equity method investee can not be recl assified into profit or loss. (II) Other comprehensive income that will b 589,427.00 -104,286,232.00 e reclassified into profit or loss. 1.Other comprehensive income under th e equity method investee can be reclassi 970,838.00 fied into profit or loss. 2.Gains and losses from changes in fair 589,427.00 -105,257,070.00 value available for sale financial assets 3.Held-to-maturity investments reclassif ied to gains and losses of available for s ale financial assets 4.The effective portion of cash flow hed ges and losses 5.Translation differences in currency fin ancial statements 6.Other VI.Total comprehensive income 1,273,198,182.00 2,102,230,753.00 VII.Earnings per share (I)Basic earnings per share (II)Diluted earnings per share 7. Consolidated Cash Flow Statement Between the Beginning of the Year and End of the Report Period In RMB Items Amount in this period Amount in last period I.Cash flows from operating activities Cash received from sales of goods or 22,976,823,367.00 19,580,053,140.00 rending of services 24 The Third Quarterly Report 2017 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 the financial assets that are measured at fair value and whose movement is counted to the current gain and loss Cash received as interest, processing fee and commission Net increase of inter-bank fund received Net increase of repurchasing business Tax returned 11,672,868.00 2,298,081.00 Other cash received from business 202,228,573.00 192,906,314.00 operation Sub-total of cash inflow 23,190,724,808.00 19,775,257,535.00 Cash paid for purchasing of 17,164,125,211.00 8,179,839,824.00 merchandise and services Net increase of client trade and advance Net increase of savings n central bank and brother company Cash paid for original contract claim Cash paid for interest, processing fee and commission Cash paid for policy dividend Cash paid to staffs or paid for staffs 1,032,922,764.00 1,124,600,927.00 Taxes paid 1,209,506,908.00 2,085,277,353.00 Other cash paid for business activities 415,754,180.00 335,520,946.00 Sub-total of cash outflow from business 19,822,309,063.00 11,725,239,050.00 activities 25 The Third Quarterly Report 2017 Cash flow generated by business 3,368,415,745.00 8,050,018,485.00 operation, net II.Cash flow generated by investing Cash received from investment retrieving Cash received as investment gains 255,018,900.00 512,343,277.00 Net cash retrieved from disposal of fixed assets, intangible assets, and other 823,706.00 1,578,434.00 long-term assets Net cash received from disposal of subsidiaries or other operational units Other investment-related cash received Sub-total of cash inflow due to 255,842,606.00 513,921,711.00 investment activities Cash paid for construction of fixed assets, intangible assets and other 2,324,097,964.00 2,311,505,369.00 long-term assets Cash paid as investment Net increase of loan against pledge Net cash received from subsidiaries and other operational units Other cash paid for investment activities Sub-total of cash outflow due to 2,324,097,964.00 2,311,505,369.00 investment activities Net cash flow generated by investment -2,068,255,358.00 -1,797,583,658.00 III.Cash flow generated by financing Cash received as investment 10,500,000.00 91,950,000.00 Incl: Cash received as investment from 10,500,000.00 141,950,000.00 minor shareholders Cash received as loans 10,533,346,894.00 10,077,351,398.00 Cash received from bond placing Other financing –related ash received 1,242,623.00 Sub-total of cash inflow from financing 10,545,089,517.00 10,169,301,398.00 activities Cash to repay debts 9,878,680,784.00 11,862,353,840.00 Cash paid as dividend, profit, or 2,098,080,828.00 3,352,287,872.00 26 The Third Quarterly Report 2017 interests Incl: Dividend and profit paid by 472,589,820.00 920,168,209.00 subsidiaries to minor shareholders Other cash paid for financing activities 9,009,163.00 Sub-total of cash outflow due to 11,985,770,775.00 15,214,641,712.00 financing activities Net cash flow generated by financing -1,440,681,258.00 -5,045,340,314.00 IV. Influence of exchange rate alternation on cash and cash equivalents V.Net increase of cash and cash -140,520,871.00 1,207,094,513.00 equivalents Add: balance of cash and cash 5,184,873,650.00 5,227,406,725.00 equivalents at the beginning of term VI ..Balance of cash and cash 5,044,352,779.00 6,434,501,238.00 equivalents at the end of term 8. Cash Flow Statement of the Parent Between the Beginning of the Year and End of the Report Period In RMB Items Amount in this period Amount in last period I.Cash flows from operating activities Cash received from sales of goods or 1,766,454,046.00 1,602,241,681.00 rending of services Tax returned 1,329,204.00 Other cash received from business 25,365,346.00 21,065,583.00 operation Sub-total of cash inflow 1,793,148,596.00 1,623,307,264.00 Cash paid for purchasing of 1,652,102,571.00 816,458,488.00 merchandise and services Cash paid to staffs or paid for staffs 217,820,826.00 228,836,275.00 Taxes paid 17,443,904.00 157,580,734.00 Other cash paid for business activities 31,083,652.00 32,094,089.00 Sub-total of cash outflow from business 1,918,450,953.00 1,234,969,586.00 activities Cash flow generated by business -125,302,357.00 388,337,678.00 operation, net II.Cash flow generated by investing Cash received from investment 100,000,000.00 300,000,000.00 27 The Third Quarterly Report 2017 retrieving Cash received as investment gains 1,240,906,577.00 2,351,701,691.00 Net cash retrieved from disposal of fixed assets, intangible assets, and other 63,862.00 long-term assets Net cash received from disposal of subsidiaries or other operational units Other investment-related cash received Sub-total of cash inflow due to 1,340,970,439.00 2,651,701,691.00 investment activities Cash paid for construction of fixed assets, intangible assets 84,280,578.00 71,825,283.00 and other long-term assets Cash paid as investment 470,489,932.00 795,583,889.00 Net cash received from subsidiaries and other operational units Other cash paid for investment activities Sub-total of cash outflow due to 554,770,510.00 867,409,172.00 investment activities Net cash flow generated by investment 786,199,929.00 1,784,292,519.00 III.Cash flow generated by financing Cash received as investment Cash received as loans 1,901,037,089.00 2,197,650,000.00 Cash received from bond placing Other financing –related ash received 1,242,623.00 Sub-total of cash inflow from 1,902,279,712.00 2,197,650,000.00 financing activities Cash to repay debts 1,800,000,000.00 2,700,000,000.00 Cash paid as dividend, profit, or 589,055,631.00 1,381,502,255.00 interests Other cash paid for financing activities 1,502,493.00 Sub-total of cash outflow due to 2,390,558,124.00 4,081,502,255.00 financing activities Net cash flow generated by financing -488,278,412.00 -1,883,852,255.00 IV. Influence of exchange rate alternation on cash and cash equivalents 28 The Third Quarterly Report 2017 V.Net increase of cash and cash 172,619,160.00 288,777,942.00 equivalents Add: balance of cash and cash 326,073,538.00 682,950,639.00 equivalents at the beginning of term VI ..Balance of cash and cash 498,692,698.00 971,728,581.00 equivalents at the end of term II. Auditor‘s report Whether the Q3 report is audited □ Yes √ No The Q3 Report is not audited. 29