ANHUI GUJING DISTILLERY COMPANY LIMITED FIRST QUARTER REPORT 2018 April 2018 Gujing Aged Original Spirits First Quarter Report 2018 Part I Important Notes The Board of Directors (or the “Board”), the Supervisory Board as well as the Directors, Supervisors and senior management of Anhui Gujing Distillery Company Limited (inclusive of its consolidated subsidiaries, the “Company”; exclusive of its subsidiaries, the “Parent Company”, except where the context otherwise requires) hereby guarantee the factuality, accuracy and completeness of the contents of this Report, and shall be jointly and severally liable for any misrepresentations, misleading statements or material omissions in this Report. All the Company’s Directors have attended the Board meeting for the review of this Report. Liang Jinhui, the Company’s legal representative, Ye Changqing, the Company’s Chief Accountant, and Zhu Jiafeng, head of the Company’s financial department (equivalent to financial manager) hereby guarantee that the Financial Statements carried in this Report are factual, accurate and complete. This Report has been prepared in both Chinese and English. Should there be any discrepancies or misunderstandings between the two versions, the Chinese version shall prevail. 2 Gujing Aged Original Spirits First Quarter Report 2018 Part II Key Corporate Information I Key Financial Information Whether the Company performed any retroactive adjustments to or restatement of its accounting data due to changes of accounting policies or correction of accounting errors □ Yes √ No January-March 2018 January-March 2017 Change Sales revenue (RMB) 2,559,879,006.93 2,173,056,581.04 17.80% Net income attributable to shareholders of 581,079,212.12 407,764,742.43 42.50% the listed company (RMB) Net income attributable to shareholders of the listed company before nonrecurring 568,229,870.99 356,588,955.68 59.35% gains and losses (RMB) Net cash flows from operating activities 193,972,491.77 648,773,393.57 -70.10% (RMB) Basic earnings per share (RMB/share) 1.15 0.81 41.98% Diluted earnings per share (RMB/share) 1.15 0.81 41.98% Weighted average return on equity (%) 8.61% 7.05% 1.56% March 31, 2018 December 31, 2017 Change Total assets (RMB) 11,503,386,290.94 10,152,862,119.05 13.30% Equity attributable to shareholders of the 7,022,524,849.23 6,459,078,378.38 8.72% listed company (RMB) Nonrecurring gains and losses: √ Applicable □ Not applicable Unit: RMB Item January-March 2018 Note Gains and losses on disposal of non-current assets (inclusive of -893,789.30 offset allowance for asset impairments) Government subsidies charged to current profit and loss (exclusive of government subsidies given in the Company’s ordinary course 2,147,822.47 of business at fixed quotas or amounts as per government’s uniform standards ) Gains and losses on changes in fair value of trading financial assets and liabilities & investment income from disposal of trading 9,149,247.17 financial assets and liabilities and available-for-sale financial assets (exclusive of effective portion of hedges that arise in the 3 Gujing Aged Original Spirits First Quarter Report 2018 Company’s ordinary course of business) Non-operating income and expense other than above 6,886,594.87 Less: Income tax effects 4,290,666.88 Non-controlling interests effects (net of tax) 149,867.20 Total 12,849,341.13 -- Explanation of why the Company classifies an item as a nonrecurring gain/loss according to the definition in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Nonrecurring Gains and Losses, or reclassifies any nonrecurring gain/loss item listed in the said explanatory announcement as a recurring gain/loss: □ Applicable √ Not applicable No such cases for the Reporting Period. II Total Number of Shareholders and Top 10 Shareholders’ Holdings at Period-End 1. Numbers of Common Shareholders and Preferred Shareholders with Resumed Voting Rights as well as Holdings of Top 10 Shareholders Unit: share Preferred shareholders with Common shareholders at period-end 21,943 resumed voting rights at 0 period-end (if any) Top 10 shareholders Shareholding Pledged or frozen shares Name of Nature of percentage at Shares Restricted shares shareholder shareholder Status Shares period-end (%) ANHUI GUJING GROUP State-owned 53.89% 271,404,022 Pledged 114,000,000 COMPANY juridical person LIMITED Foreign juridical NORGES BANK 2.92% 14,712,309 person GAOLING Foreign juridical 2.47% 12,446,408 FUND,L.P. person AGRICULTURAL BANK OF CHINA-E FUND Other 1.65% 8,307,868 COMSUMPTION SECTOR STOCK SECURITIES INVESTMENT 4 Gujing Aged Original Spirits First Quarter Report 2018 FUND UBS (LUX) EQUITY FUND - Foreign juridical CHINA 1.41% 7,096,361 person OPPORTUNITY (USD) CHINA CONSTRUCTION BANK-YINHUA RICH THEME Other 1.38% 6,936,487 HYBRID SECURITIES INVESTMENT FUND CHINA INT'L CAPITAL CORP Foreign juridical HONG KONG 1.34% 6,752,388 person SECURITIES LTD CENTRAL HUIJIN ASSET State-owned 1.30% 6,543,600 MANAGEMENT juridical person CO., LTD. UBS (LUX) EQUITY FUND - Foreign juridical 0.98% 4,949,038 GREATER person CHINA (USD) GREENWOODS Foreign juridical CHINA ALPHA 0.98% 4,939,963 person MASTER FUND Top 10 non-restricted shareholders Type of shares Name of shareholder Non-restricted shares held at period-end Type Shares ANHUI GUJING GROUP RMB common 271,404,022 271,404,022 COMPANY LIMITED stock Domestically NORGES BANK 14,712,309 listed stock for 14,712,309 foreign investors Domestically GAOLING FUND,L.P. 12,446,408 listed stock for 12,446,408 foreign investors 5 Gujing Aged Original Spirits First Quarter Report 2018 AGRICULTURAL BANK OF CHINA-E FUND COMSUMPTION RMB common 8,307,868 8,307,868 SECTOR STOCK SECURITIES stock INVESTMENT FUND Domestically UBS (LUX) EQUITY FUND - 7,096,361 listed stock for 7,096,361 CHINA OPPORTUNITY (USD) foreign investors CHINA CONSTRUCTION BANK-YINHUA RICH THEME RMB common 6,936,487 6,936,487 HYBRID SECURITIES stock INVESTMENT FUND Domestically CHINA INT'L CAPITAL CORP 6,752,388 listed stock for 6,752,388 HONG KONG SECURITIES LTD foreign investors CENTRAL HUIJIN ASSET RMB common 6,543,600 6,543,600 MANAGEMENT CO., LTD. stock Domestically UBS (LUX) EQUITY FUND - 4,949,038 listed stock for 4,949,038 GREATER CHINA (USD) foreign investors Domestically GREENWOODS CHINA ALPHA 4,939,963 listed stock for 4,939,963 MASTER FUND foreign investors Among the above shareholders, the Company's controlling shareholder, Anhui Gujing Group Co., Ltd., has no relationship with other shareholders and does not belong to the acting-in-concert stipulated in the Administrative Measures on Information Disclosure of Related or acting-in-concert parties Changes in Shareholding of Listed Companies. In addition, the relationship between other among shareholders above shareholders is unknown, and it is unknown whether it belongs to the acting-in-concert stipulated in the Administrative Measures on Information Disclosure of Changes in Shareholding of Listed Companies. Shareholders conducting securities N/A margin trading (if any) Indicate by tick mark whether any of the top 10 common shareholders or the top 10 non-restricted common shareholders of the Company conducted any promissory repo during the Reporting Period. □ Yea √ No No such cases in the Reporting Period. 2. Number of Preferred Shareholders and Shareholdings of Top 10 of Them □ Applicable √ Not applicable 6 Gujing Aged Original Spirits First Quarter Report 2018 Part III Significant Events I Changes in Selected Financial Statement Items and Explanation of why √ Applicable □ Not applicable March 31, 2018 December 31, 2017 Balance sheet items Change (%) Explanation of why (RMB) (RMB) Notes receivable 1,813,496,352.34 720,611,126.78 151.66% Increase in sales revenue Increase in prepaid advertising Prepayments 76,361,753.26 41,729,637.34 82.99% fees Notes payable 74,496,000.00 200,750,000.00 -62.89% Settlement of due notes payable Advances from customers 1,285,771,695.15 503,083,108.13 155.58% Increase in customer orders Increase in unrecognized Other current liabilities 482,610,008.01 182,846,942.10 163.94% expenditures during peak season of China’s Lunar New Year January-March January-March Income statement items Change (%) Explanation of why 2018 (RMB) 2017 (RMB) Decrease in income from Investment income 27,448,214.89 62,391,926.18 -56.01% financial assets Increase in income from sale of Asset disposal income 81,303.79 40,571.66 100.40% obsolete and old equipment Other income 2,147,822.47 14,343,227.97 -85.03% Decrease in tax rebates Net income 581,079,212.12 407,764,742.43 42.50% Increase in sales revenue January-March January-March Cash flows statement items Change (%) Explanation of why 2018 (RMB) 2017 (RMB) Decrease in proceeds from sale Net cash flows from 193,972,491.77 648,773,393.57 -70.10% of commodities and increase in operating activities notes receivable Subtotal of cash generated by Decrease in disinvestments in 476,038,045.85 1,424,018,432.80 -66.57% investing activities wealth management instruments Net cash flows from Decrease in payments for 74,965,977.62 -145,592,375.71 151.49% investing activities investment 7 Gujing Aged Original Spirits First Quarter Report 2018 II Progress, Influence and Solutions Associated with Significant Events □ Applicable √ Not applicable III Commitments that the Company’s Actual Controller, Shareholders, Related Parties and Acquirers, as well as the Company and Other Commitment Makers, Failed to Fulfill on Time during Reporting Period □ Applicable √ Not applicable No such cases in the Reporting Period. IV Operating Result Forecast for January-June 2018 Warning of a forecast loss on or a forecast significant year-over-year change in net income for January-June 2018, as well as explanation of why: □ Applicable √ Not applicable V Securities Investments √ Applicable □ Not applicable Variet Symb Opening Closing Gain/loss Initial Opening Closing y of ol of Name of holding Closing holding in Accounting investment holding holding book value Reporting Source securit securit security percenta percenta (RMB) Period title cost (RMB) (share) (share) y y ge ge (RMB) Available-for-s 60198 44,385,674.2 17,963,1 17,963,1 70,594,983.0 Self-own Stock ZGYH 0.00 ale financial 8 0 00 00 0 ed funds assets Available-for-s 00000 70,317,243.9 8,040,88 8,040,88 87,645,690.1 Self-own Stock PAYH 0.00 ale financial 1 8 9 9 0 ed funds assets Guangfa Nest Low Risk No. Available-for-s 150,000,000. 8,841,868. Self-own Funds 1E 0 0 0.00 ale financial 00 22 ed funds Security assets Investme nt Funds CITIC Wings Available-for-s Dapu No. 200,000,000. 215,335,353. Self-own Funds 0 0 0.00 ale financial 1 Asset 00 08 ed funds assets Manageme nt Plan 8 Gujing Aged Original Spirits First Quarter Report 2018 464,702,918. 26,003,9 26,003,9 373,576,026. 8,841,868. Total -- -- -- 18 89 89 18 22 Disclosure date of announcement on Board’s consent for securities investment Disclosure date of announcement on shareholders’ meeting’s consent for securities investment (if any) VI Investments in Derivative Financial Instruments √ Applicable □ Not applicable Unit: RMB’0,000 (in RMB ten thousand yuan) Proportio n of closing Actual Purchas Sold in Relations Initial Opening Impairme Closing investme gain/los Related Type of ed in the the hip with investme Startin Endin investme nt investme nt s in the Operator transacti derivativ Reporti Reporti the nt g date g date nt provision nt amount Reporti on e ng ng Company amount amount (if any) amount in the ng Period Period Company Period ’s closing net assets Reverse Reverse repurcha repurcha March April se of Naught No se of 29, 9, 5,000 9,000 5,000 9,000 1.28% 10.01 national national 2018 2018 debt debt Total -- -- 5,000 9,000 5,000 9,000 1.28% 10.01 Source of money used for investment All from the Company’s own funds Legal matters involved (if applicable) N/A Disclosure date of board announcement August 30, 2013 approving derivative investment (if any) Disclosure date of shareholders’ meeting announcement approving derivative investment (if any) Analysis of risks and control measures The Company had controlled the relevant risks strictly according to the Derivatives associated with derivative investments Investment Management System. 9 Gujing Aged Original Spirits First Quarter Report 2018 held in Reporting Period (including but not limited to market risk, liquidity risk, credit risk, operational risk, legal risk, etc.) Changes in market prices or fair value of derivative investments in Reporting Period (fair value analysis should N/A include measurement method and related assumptions and parameters) Significant changes in accounting policies and specific accounting principles adopted for derivative N/A investments in Reporting Period compared to last reporting period Based on the sustainable development of the main business and the sufficient free idle money, the Company increased the profits through investing in the reasonable financial derivative instruments, which was in favor of improving the service efficiency of the idle funds. In order to reduce the investment risks of the financial derivative instruments, the Company had set up corresponding supervision mechanism for the financial derivative Opinion of independent directors on instrument business and formulated reasonable accounting policy as well as specific derivative investments and risk control principles of financial accounting. The derivative Investment business developed separately took national debts as mortgage object, which was met with the cautious and steady risks management principle and the interest of the Company and shareholders. Therefore, agreed the Company to develop the derivative Investment business of reverse repurchase of national debt not more than the limit of RMB0.3 billion. VII Visits Paid to the Company for Purposes of Research, Communication, Interview, etc. during Reporting Period □ Applicable √ Not applicable No such cases in the Reporting Period. VIII Irregularities in Provision of Guarantees for External Parties □ Applicable √ Not applicable No such cases in the Reporting Period. IX Occupation of the Company’s Money by Its Controlling Shareholder or Related Parties for Non-Operating Purposes □ Applicable √ Not applicable No such cases in the Reporting Period. 10 Gujing Aged Original Spirits First Quarter Report 2018 Part IV Financial Statements I Financial Statements 1. Consolidated Balance Sheet Prepared by Anhui Gujing Distillery Company Limited March 31, 2018 Unit: RMB Item March 31, 2018 December 31, 2017 Current assets: Monetary assets 1,753,027,095.79 1,484,088,626.40 Settlement reserve Interbank loans granted Financial assets at fair value through 42,055.28 99,800.76 profit or loss Derivative financial assets Notes receivable 1,813,496,352.34 720,611,126.78 Accounts receivable 25,975,449.39 22,466,143.06 Prepayments 76,361,753.26 41,729,637.34 Premiums receivable Reinsurance receivables Receivable reinsurance contract reserve Interest receivable 16,643,178.08 13,883,178.08 Dividends receivable Other receivables 18,677,957.65 15,390,106.14 Financial assets purchased under resale agreements Inventories 2,191,370,634.32 2,064,130,297.51 Assets classified as held for sale Current portion of non-current assets Other current assets 1,765,087,192.28 1,772,310,946.58 Total current assets 7,660,681,668.39 6,134,709,862.65 Non-current assets: 11 Gujing Aged Original Spirits First Quarter Report 2018 Loans and advances to customers Available-for-sale financial assets 373,576,026.18 517,086,347.91 Held-to-maturity investments Long-term receivables Long-term equity investments Investment property 4,464,170.83 5,343,777.33 Property, plant and equipment 1,762,399,335.64 1,792,254,178.56 Construction in progress 55,170,402.14 54,496,798.56 Construction materials Proceeds from disposal of property, plant and equipment Productive living assets Oil and gas assets Intangible assets 687,728,842.34 691,381,442.67 R&D expense Goodwill 478,283,495.29 478,283,495.29 Long-term prepaid expense 66,624,518.64 69,238,523.78 Deferred income tax assets 85,983,805.49 92,157,477.74 Other non-current assets 328,474,026.00 317,910,214.56 Total non-current assets 3,842,704,622.55 4,018,152,256.40 Total assets 11,503,386,290.94 10,152,862,119.05 Current liabilities: Short-term borrowings Borrowings from central bank Customer deposits and deposits from banks and other financial institutions Interbank loans obtained Financial liabilities at fair value through profit or loss Derivative financial liabilities Notes payable 74,496,000.00 200,750,000.00 Accounts payable 280,829,231.41 435,615,039.83 Advances from customers 1,285,771,695.15 503,083,108.13 Financial assets sold under repurchase agreements Handling charges and commissions 12 Gujing Aged Original Spirits First Quarter Report 2018 payable Payroll payable 324,781,563.98 372,374,014.37 Taxes payable 426,980,884.31 420,984,845.45 Interest payable Dividends payable Other payables 1,056,500,017.95 1,032,543,553.34 Reinsurance payables Insurance contract reserve Payables for trading of securities Payables for underwriting of securities Liabilities directly associated with assets classified as held for sale Current portion of non-current liabilities Other current liabilities 482,610,008.01 182,846,942.10 Total current liabilities 3,931,969,400.81 3,148,197,503.22 Non-current liabilities: Long-term borrowings Bonds payable Including: Preferred shares Perpetual bonds Long-term payables Long-term payroll payable Specific payables Provisions Deferred income 42,409,564.84 43,706,503.22 Deferred income tax liabilities 113,462,436.09 119,779,105.90 Other non-current liabilities Total non-current liabilities 155,872,000.93 163,485,609.12 Total liabilities 4,087,841,401.74 3,311,683,112.34 Owners’ equity: Share capital 503,600,000.00 503,600,000.00 Other equity instruments Including: Preferred shares Perpetual bonds 13 Gujing Aged Original Spirits First Quarter Report 2018 Capital reserves 1,295,405,592.25 1,295,405,592.25 Less: Treasury shares Other comprehensive income 35,888,086.17 53,520,827.44 Specific reserve Surplus reserves 256,902,260.27 256,902,260.27 General reserve Retained earnings 4,930,728,910.54 4,349,649,698.42 Total equity attributable to owners of 7,022,524,849.23 6,459,078,378.38 Parent Company Non-controlling interests 393,020,039.97 382,100,628.33 Total owners’ equity 7,415,544,889.20 6,841,179,006.71 Total liabilities and owners’ equity 11,503,386,290.94 10,152,862,119.05 Legal representative: Liang Jinhui The Company’s chief accountant: Ye Changqing Head of the Company’s financial department: Zhu Jiafeng 2. Parent Company Balance Sheet Unit: RMB Item March 31, 2018 December 31, 2017 Current assets: Monetary assets 1,560,630,499.05 1,276,262,109.02 Financial assets at fair value through 42,055.28 99,800.76 profit or loss Derivative financial assets Notes receivable 1,542,720,297.98 674,521,654.40 Accounts receivable 8,647,569.44 8,509,918.03 Prepayments 31,057,647.04 8,534,600.82 Interest receivable Dividends receivable Other receivables 114,866,760.99 130,357,778.75 Inventories 1,933,160,333.81 1,818,358,884.18 Assets classified as held for sale Current portion of non-current assets Other current assets 1,390,504,300.42 1,554,870,774.98 Total current assets 6,581,629,464.01 5,471,515,520.94 14 Gujing Aged Original Spirits First Quarter Report 2018 Non-current assets: Available-for-sale financial assets 373,025,826.18 516,530,547.91 Held-to-maturity investments Long-term receivables Long-term equity investments 1,155,089,408.32 1,155,089,408.32 Investment property 26,021,322.14 26,409,050.95 Property, plant and equipment 1,282,527,806.15 1,303,119,011.66 Construction in progress 43,080,233.75 44,673,219.38 Construction materials Proceeds from disposal of property, plant and equipment Productive living assets Oil and gas assets Intangible assets 184,598,301.43 185,868,178.71 R&D expense Goodwill Long-term prepaid expense 54,275,744.76 58,563,409.89 Deferred income tax assets 37,996,747.93 37,996,747.93 Other non-current assets 12,474,026.00 12,474,026.00 Total non-current assets 3,169,089,416.66 3,340,723,600.75 Total assets 9,750,718,880.67 8,812,239,121.69 Current liabilities: Short-term borrowings Financial liabilities at fair value through profit or loss Derivative financial liabilities Notes payable 44,196,370.00 0.00 Accounts payable 214,579,037.90 347,757,180.53 Advances from customers 2,473,783,059.78 1,680,678,175.37 Payroll payable 82,345,180.87 110,435,403.45 Taxes payable 236,736,315.53 262,884,211.13 Interest payable Dividends payable Other payables 187,528,501.04 173,250,790.29 Liabilities directly associated with 15 Gujing Aged Original Spirits First Quarter Report 2018 assets classified as held for sale Current portion of non-current liabilities Other current liabilities 16,824,113.21 18,296,415.85 Total current liabilities 3,255,992,578.33 2,593,302,176.62 Non-current liabilities: Long-term borrowings Bonds payable Including: Preferred shares Perpetual bonds Long-term payables Long-term payroll payable Specific payables Provisions Deferred income 38,794,308.28 39,976,048.28 Deferred income tax liabilities 13,993,396.36 19,792,209.68 Other non-current liabilities Total non-current liabilities 52,787,704.64 59,768,257.96 Total liabilities 3,308,780,282.97 2,653,070,434.58 Owners’ equity: Share capital 503,600,000.00 503,600,000.00 Other equity instruments Including: Preferred shares Perpetual bonds Capital reserves 1,247,162,107.35 1,247,162,107.35 Less: Treasury shares Other comprehensive income 35,826,195.11 53,454,736.38 Specific reserve Surplus reserves 251,800,000.00 251,800,000.00 Retained earnings 4,403,550,295.24 4,103,151,843.38 Total owners’ equity 6,441,938,597.70 6,159,168,687.11 Total liabilities and owners’ equity 9,750,718,880.67 8,812,239,121.69 3. Consolidated Income Statement Unit: RMB 16 Gujing Aged Original Spirits First Quarter Report 2018 Item January-March 2018 January-March 2017 1. Operating revenue 2,559,879,006.93 2,173,056,581.04 Including: Sales revenue 2,559,879,006.93 2,173,056,581.04 Interest revenue Premium revenue Handling charge and commission revenue 2. Cost of operating revenue 1,809,442,510.38 1,698,418,322.96 Including: Cost of sales 518,797,750.19 485,600,237.86 Interest expense Handling charge and commission expense Surrenders Net claims paid Net amount provided as insurance contract reserve Expenditure on policy dividends Reinsurance premium expense Taxes and surtaxes 375,443,186.81 361,822,180.65 Selling expense 793,946,063.51 741,250,390.67 Administrative expense 127,311,977.26 120,878,754.27 Finance costs -6,056,467.40 -11,133,240.49 Asset impairment losses Add: Gains on changes in fair value (“-” -27,498.41 -3,866.40 for losses) Investment income (“-” for loss) 27,448,214.89 62,391,926.18 Including: Share of profit or loss of joint ventures and associates Foreign exchange gains (“-” for losses) Asset disposal income (“-” for loss) 81,303.79 40,571.66 Other income 2,147,822.47 14,343,227.97 3. Operating income (“-” for loss) 780,086,339.29 551,410,117.49 Add: Non-operating revenue 6,907,556.84 7,630,463.01 Less: Non-operating expense 996,055.06 708,757.60 4. Pretax income (“-” for loss) 785,997,841.07 558,331,822.90 Less: Income tax expense 193,999,217.31 139,416,289.06 17 Gujing Aged Original Spirits First Quarter Report 2018 5. Net income (“-” for net loss) 591,998,623.76 418,915,533.84 5.1 Net income from continuing 591,998,623.76 418,915,533.84 operations (“-” for net loss) 5.2 Net income from discontinued operations (“-” for net loss) Attributable to owners of Parent 581,079,212.12 407,764,742.43 Company Attributable to non-controlling 10,919,411.64 11,150,791.41 interests 6. Other comprehensive income, net of -17,632,741.27 -20,967,165.55 tax Attributable to owners of Parent -17,632,741.27 -20,967,165.55 Company 6.1 Items that will not be reclassified to profit or loss 6.1.1 Changes in net liabilities or assets caused by re-measurements on defined benefit pension schemes 6.1.2 Share of other comprehensive income of investees that will not be reclassified to profit or loss under equity method 6.2 Items that may subsequently be -17,632,741.27 -20,967,165.55 reclassified to profit or loss 6.2.1 Share of other comprehensive income of investees that will be reclassified to profit or loss under equity method 6.2.2 Gains/Losses on changes in fair value of available-for-sale financial -17,632,741.27 -20,967,165.55 assets 6.2.3 Gains/Losses arising from reclassification of held-to-maturity investments to available-for-sale financial assets 6.2.4 Effective gains/losses on cash flow hedges 6.2.5 Differences arising from translation of foreign currency-denominated financial statements 6.2.6 Other 18 Gujing Aged Original Spirits First Quarter Report 2018 Attributable to non-controlling interests 7. Total comprehensive income 574,365,882.49 397,948,368.29 Attributable to owners of Parent 563,446,470.85 386,797,576.88 Company Attributable to non-controlling 10,919,411.64 11,150,791.41 interests 8. Earnings per share 8.1 Basic earnings per share 1.15 0.81 8.2 Diluted earnings per share 1.15 0.81 Legal representative: Liang Jinhui The Company’s chief accountant: Ye Changqing Head of the Company’s financial department: Zhu Jiafeng 4. Parent Company Income Statement Unit: RMB Item January-March 2018 January-March 2017 1. Sales revenue 1,273,232,528.70 1,225,485,876.84 Less: Cost of sales 483,888,734.16 441,659,248.56 Taxes and surtaxes 316,554,892.27 315,040,162.76 Selling expense 22,167,564.98 91,453,417.90 Administrative expense 84,525,943.53 81,529,203.55 Finance costs -4,400,795.16 -2,633,074.65 Asset impairment losses Add: Gains on changes in fair value -27,498.41 -3,866.40 (“-” for losses) Investment income (“-” for loss) 24,534,436.91 60,640,216.55 Including: Share of profit or loss of joint ventures and associates Asset disposal income (“-” for loss) Other income 1,181,740.01 14,138,227.97 2. Operating income (“-” for loss) 396,184,867.44 373,211,496.84 Add: Non-operating revenue 5,301,985.87 3,943,066.55 Less: Non-operating expense 955,584.15 646,594.22 3. Pretax income (“-” for loss) 400,531,269.16 376,507,969.17 19 Gujing Aged Original Spirits First Quarter Report 2018 Less: Income tax expense 100,132,817.29 94,126,992.30 4. Net income (“-” for net loss) 300,398,451.87 282,380,976.87 4.1 Net income from continuing 300,398,451.87 282,380,976.87 operations (“-” for net loss) 4.2 Net income from discontinued operations (“-” for net loss) 5. Other comprehensive income, net of -17,628,541.27 -21,722,327.16 tax 5.1 Items that will not be reclassified to profit or loss 5.1.1 Changes in net liabilities or assets caused by re-measurements on defined benefit pension schemes 5.1.2 Share of other comprehensive income of investees that will not be reclassified into profit or loss under equity method 5.2 Items that may subsequently be -17,628,541.27 -21,722,327.16 reclassified to profit or loss 5.2.1 Share of other comprehensive income of investees that will be reclassified into profit or loss under equity method 5.2.2 Gains/Losses on changes in fair value of available-for-sale financial -17,628,541.27 -21,722,327.16 assets 5.2.3 Gains/Losses arising from reclassification of held-to-maturity investments to available-for-sale financial assets 5.2.4 Effective gains/losses on cash flow hedges 5.2.5 Differences arising from translation of foreign currency-denominated financial statements 5.2.6 Other 6. Total comprehensive income 282,769,910.60 260,658,649.71 7. Earnings per share 7.1 Basic earnings per share 0.6 0.56 7.2 Diluted earnings per share 0.6 0.56 20 Gujing Aged Original Spirits First Quarter Report 2018 5. Consolidated Cash Flow Statement Unit: RMB Item January-March 2018 January-March 2017 1. Cash generated by or used in operating activities: Proceeds from sale of commodities 2,317,913,398.32 2,217,759,396.02 and rendering of services Net increase in customer deposits and deposits from banks and other financial institutions Net increase in loans from central bank Net increase in loans from other financial institutions Premiums received on original insurance contracts Net proceeds from reinsurance Net increase in deposits and investments of policy holders Net increase in proceeds from disposal of financial assets at fair value through profit or loss Interest, handling charges and commissions received Net increase in interbank loans obtained Net increase in proceeds from repurchase transactions Tax rebates 809,884.08 13,696,586.24 Cash generated by other operating 36,191,356.85 106,104,856.09 activities Subtotal of cash generated by operating 2,354,914,639.25 2,337,560,838.35 activities Payments for commodities and 559,193,732.69 281,029,361.24 services Net increase in loans and advances to customers Net increase in deposits in central bank and in interbank loans granted Payments for claims on original insurance contracts 21 Gujing Aged Original Spirits First Quarter Report 2018 Interest, handling charges and commissions paid Policy dividends paid Cash paid to and for employees 386,791,520.43 321,777,759.08 Taxes paid 880,876,488.87 873,979,926.33 Cash used in other operating 334,080,405.49 212,000,398.13 activities Subtotal of cash used in operating 2,160,942,147.48 1,688,787,444.78 activities Net cash flows from operating activities 193,972,491.77 648,773,393.57 2. Cash generated by or used in investing activities: Proceeds from disinvestments 450,660,768.81 1,359,977,129.63 Investment income 25,292,217.04 64,034,803.17 Net proceeds from disposal of property, plant and equipment, 85,060.00 6,500.00 intangible assets and other long-lived assets Net proceeds from disposal of subsidiaries or other business units Cash generated by other investing activities Subtotal of cash generated by investing 476,038,045.85 1,424,018,432.80 activities Payments for acquisition of property, plant and equipment, intangible assets 70,853,122.83 32,203,466.65 and other long-lived assets Payments for investments 330,218,945.40 1,537,407,341.86 Net increase in pledged loans granted Net payments for acquisition of subsidiaries and other business units Cash used in other investing activities Subtotal of cash used in investing 401,072,068.23 1,569,610,808.51 activities Net cash flows from investing activities 74,965,977.62 -145,592,375.71 3. Cash generated by or used in financing activities: Capital contributions received Including: Capital contributions by non-controlling interests to subsidiaries 22 Gujing Aged Original Spirits First Quarter Report 2018 Increase in borrowings obtained Net proceeds from issuance of bonds Cash generated by other financing activities Subtotal of cash generated by financing activities Repayment of borrowings Payments for interest and dividends Including: Dividends paid by subsidiaries to non-controlling interests Cash used in other financing activities Subtotal of cash used in financing activities Net cash flows from financing activities 4. Effect of foreign exchange rate changes on cash and cash equivalents 5. Net increase in cash and cash 268,938,469.39 503,181,017.86 equivalents Add: Cash and cash equivalents, 1,024,088,626.40 527,849,026.07 beginning of the period 6. Cash and cash equivalents, end of the 1,293,027,095.79 1,031,030,043.93 period 6. Parent Company Cash Flow Statement Unit: RMB Item January-March 2018 January-March 2017 1. Cash generated by or used in operating activities: Proceeds from sale of commodities 1,095,672,510.95 1,719,269,247.73 and rendering of services Tax rebates 0.00 13,013,817.25 Cash generated by other operating 60,289,004.82 29,416,467.68 activities Subtotal of cash generated by operating 1,155,961,515.77 1,761,699,532.66 activities Payments for commodities and 358,347,950.36 258,976,795.82 services Cash paid to and for employees 165,733,823.32 153,768,915.89 Taxes paid 559,374,536.53 545,332,001.77 23 Gujing Aged Original Spirits First Quarter Report 2018 Cash used in other operating 49,683,984.62 44,903,998.58 activities Subtotal of cash used in operating 1,133,140,294.83 1,002,981,712.06 activities Net cash flows from operating activities 22,821,220.94 758,717,820.60 2. Cash generated by or used in investing activities: Proceeds from disinvestments 420,660,768.81 1,359,977,129.63 Investment income 25,135,723.89 64,034,803.17 Net proceeds from disposal of property, plant and equipment, intangible assets and other long-lived assets Net proceeds from disposal of subsidiaries or other business units Cash generated by other investing activities Subtotal of cash generated by investing 445,796,492.70 1,424,011,932.80 activities Payments for acquisition of property, plant and equipment, intangible assets 44,030,378.21 27,119,815.40 and other long-lived assets Payments for investments 140,218,945.40 1,474,407,341.86 Net payments for acquisition of subsidiaries and other business units Cash used in other investing activities Subtotal of cash used in investing 184,249,323.61 1,501,527,157.26 activities Net cash flows from investing activities 261,547,169.09 -77,515,224.46 3. Cash generated by or used in financing activities: Capital contributions received Increase in borrowings obtained Net proceeds from issuance of bonds Cash generated by other financing activities Subtotal of cash generated by financing activities Repayment of borrowings Payments for interest and dividends 24 Gujing Aged Original Spirits First Quarter Report 2018 Cash used in other financing activities Sub-total of cash used in financing activities Net cash flows from financing activities 4. Effect of foreign exchange rate changes on cash and cash equivalents 5. Net increase in cash and cash 284,368,390.03 681,202,596.14 equivalents Add: Cash and cash equivalents, 826,262,109.02 225,792,686.26 beginning of the period 6. Cash and cash equivalents, end of the 1,110,630,499.05 906,995,282.40 period II Independent Auditor’s Report Indicate by tick mark whether the Q1 financial statements have been audited by an independent auditor. □Yes √ No The Q1 financial statements have not been audited by such an auditor. 25