Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
二零一四年半年度报告
SEMIANNUAL REPORT 2014
Hangzhou Steam Turbine Co., Ltd.
August 18, 2014
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter I. Important Remarks, Table of Contents, and
Glossaries
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
Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness of
the Report.
All of the directors presented the board meeting on which this report was examined. The meeting was held by
means of onsite voting and telecommunication voting. Director Liu Guoqiang voted by telecommunication, and
other directors presented the meeting onsite.
The Company will not distribute cash dividend or bonus shares, neither capitalizing of common reserves for the
report period.
Chairman Mr. Nie Zhonghai, Chief Financial Officer Pu Yangshuo, and the Chief of Accounting Department Ms.
Jiang Rong hereby declare: the Financial Statement in the report is guaranteed to be truthful and complete.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Table of Contents
Chapter I. Important Remarks, Table of Contents, and Glossaries.............................................................................2
Chapter II. Company Profile ......................................................................................................................................5
Chapter III. Financial Highlights................................................................................................................................6
Chapter IV. Board of Directors’ Report......................................................................................................................8
Chapter V. Significant Events................................................................................................................................16
Chapter VI. Change of Share Equity and Shareholders ...........................................................................................21
Chapter VII. The Preference Shares .........................................................................................................................23
Chapter VIII. Particulars of Directors, Supervisors, and Management ....................................................................23
Chapter IX. Financial Report ...................................................................................................................................24
Chapter X. Documents for Reference ......................................................................................................................95
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Glossary
Terms Defined as Description
Company, the Company Defined as Hangzhou Steam Turbine Co., Ltd.
The Group, Hangqi Group Defined as Hangzhou Steam Turbine Power Group Co., Ltd.
The report period Defined as January 1 – June 30 2014
Hangzhou Zhongneng Steam Turbine Power Co., Ltd. – the
Zhongneng Co. Defined as
holding subsidiary of the Company
Hangzhou Steam Turbine Casting Co., Ltd. – the holding
Casting Co. Defined as
subsidiary of the Company
Zhejiang Steam Turbine Packaged Technology Development Co.,
Packaged Tech. Co. Defined as
Ltd. – the holding subsidiary of the Company
Hangzhou Steam Turbine Machinery Equipment Co., Ltd. - the
Machinery Co. Defined as
holding subsidiary of the Company
Hangzhou Steam Turbine Auxiliary Machinery Co., Ltd. - the
Auxiliary Machine Co. Defined as
holding subsidiary of the Company
Zhejiang Turbine Import & Export Co., Ltd. – the holding
Turbine Co. Defined as
subsidiary of the Company
Hangzhou Steam Turbine Heavy Industry Co., Ltd. - the holding
Heavy Industry Co. Defined as
subsidiary of the Company
The Board of Directors Defined as The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
The Supervisory Committee Defined as The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
The Shareholders’ Meeting Defined as The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
RMB, RMB0’000,
Defined as RMB Yuan, RMB10 thousand Yuan, RMB100 million Yuan
RMB000’000’000
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter II. Company Profile
I. Company profile
Stock ID Hangqilun B Stock Code 200771
Stock ID changed None
Stock Exchange Listed in Shenzhen Stock Exchange
Company Name in
杭州汽轮机股份有限公司
Chinese
Short form of Company
Hangqilun
Name in Chinese
Name in English HANGZHOU STEAM TURBINE CO.,LTD.
Abbreviation in English HTC
Legal representative: Nie Zhonghai
II. Contacts
Secretary of the Board Representative of Stock Affairs
Name Yu Changquan Wang Gang
Address No. 357 Shiqiao Rd. Hangzhou No. 357 Shiqiao Rd. Hangzhou
Tel. 0571-85780432 0571-85780198
Fax. 0571-85780433 0571-85780433
Email. ychq@htc.cn wg@htc.cn
III. Other info.
1. Contacts
No change to the registered address, office address, postal code, official website, and email address of the
Company. For details please find the Annual Report 2013.
2. Information inquiry
None of the official presses, website, and place of enquiry has been changed in the report period. For details
please find the Annual Report 2013.
3. Change of business registration
None of the registration date and place, the license number, tax number, organization number has been changed in
the report period. For details please find Annual Report 2013.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter III. Financial Highlights
I. Main accounting data and indices
Are there any retrospective adjustment or restatement of financial information of previous year due to change of
accounting policies or correcting of accounting errors?
No
Same period last
This report term Increase/decrease (%)
year
Turnover (RMB) 1,743,362,642.27 2,019,745,830.92 -13.68%
Net profit attributable to shareholders of the
196,174,851.01 232,926,224.38 -15.78%
listed company (yuan)
Net profit attributable to the shareholders of
the listed company and after deducting of 181,414,092.36 220,033,753.07 -17.55%
non-recurring gain/loss(RMB)
Net Cash flow generated by business
119,786,983.72 112,341,197.85 6.63%
operation (RMB)
Basic earnings per share (Yuan/share) 0.26 0.31 -16.13%
Diluted earnings per share (Yuan/share) 0.26 0.31 -16.13%
Net income on asset, weighted 4.53% 5.84% -1.31%
Changed at end of report
Ended this report
End of prev. year period over end of previous
term
period
Gross Assets (RMB) 7,760,453,482.73 7,645,648,806.43 1.50%
Net asset attributable to owners of the PLC 4,276,885,828.98 4,230,942,110.74 1.09%
II. Differences in accounting information under IAS and domestic accounting standard
1. Differences between the net profit and net asset in the financial reports prepared under IAS and Chinese
Accounting Standard
In RMB Yuan
Net profit attributable to the shareholders Net asset attributable to the shareholders
of the listed company of the listed company
Current term Amount of last term End of term Beginning of term
On Chinese Accounting
196,174,851.01 232,926,224.38 4,276,885,828.98 4,230,942,110.74
Standard
Items and amounts adjusted on IAS
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
2. Differences between the net profit and net asset in the financial reports prepared under IAS and Chinese
Accounting Standard
In RMB Yuan
Net profit attributable to the shareholders Net asset attributable to the shareholders
of the listed company of the listed company
Current term Amount of last term End of term Beginning of term
On Chinese Accounting
196,174,851.01 232,926,224.38 4,276,885,828.98 4,230,942,110.74
Standard
Accounts and amounts adjusted according to overseas accounting standard
3. Statement on the differences of accounting information on IAS and domestic accounting standard
Not applicable
III. Non-recurring gain/loss items and amounts
In RMB Yuan
Items Amount Remarks
Gain/loss from disposal of non-current assets (includes
the recovered part of asset impairment provision already 226,573.76
provided)
Gains and losses included in the current period of
government subsidies, excluding those government
grants which are closely related to normal business and 4,002,971.00
in line with national policy , or in accordance with fixed
standards or quantities
Gain/loss from change of fair value of transactional
asset and liabilities, and investment gains from disposal
of transactional financial assets and liabilities and
9,549,596.76
sellable financial assets, other than valid period value
instruments related to the Company’s common
businesses
Other non-business income and expenditures other than
4,595,187.79
the above
Less: Influenced amount of income tax 1,996,268.62
Influence on minority shareholders’ equity (after
1,617,302.04
tax)
Total 14,760,758.65 --
None of non-recurring gain/loss items recognized as recurring gain/loss items as defined by the Information
Disclosure Explanatory Announcement No.1 – Non-recurring gain/loss in the report period.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter IV. Board of Directors’ Report
I. Business overview
In the 1st half of 2014, the world economy was showing a state of uncertain and imbalance. The leading
economies was recovering but at a speed lower than expectation, while the new-coming economies were slowing
down. Chinese government was slowing down the development initiatively and turned to deepening of structural
adjustment. In the report period, domestic industrial investment was descending continuously, the large scale
equipment business was facing severe challenge of the weakened market demand.
Under the impact of macro economy, the downstream industries were in the process of productivity reducing and
inventory dumping. Investment in new productivities was obviously slowing down. Great uncertainty and delay of
investment projects have brought a more complex environment to the Company.
The management was fully aware of the difficulties and challenges the Company was facing. A series of strategies
were carried further, i.e. expanding of industrial chain, international and differentiation strategy, and parallel
developing of production and service providing. A number of measurements were implemented regarding
enhancing of technical innovation, improving of marketing system, promoting of finest quality projects,
deepening of fine management, lifting of operation efficiency, and reinforcing of risk administration. Somehow
the business operation was in a steady pace.
In the report period, the Company has realized turnover of RMB1,743,362,600, a 13.68% of decrease YoY; total
profit of RMB267,376,000, a 20.53% of decrease YoY; net profit of RMB227,702,100, a 21.15% of decrease
YoY; and net profit attributable to owners of the listed company of RMB196,174,900, a 15.78% of decrease YoY.
II. Analysis of main business
(I) General Information
Turnover of the report period has decreased by 13.68% comparing with the 1st half of last year. This was mainly
caused by the market environment. However benefited from modification of product composition, the gross profit
has increased slightly. The total profit of the report period decreased by 20.53% due to increase of impairment
provisions provided and decrease of investment gains.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Change in main financial data RMB
Change over
Same period last
In RMB Yuan This report term same period Cause of change
year
last year
Turnover 1,743,362,642.27 2,019,745,830.92 -13.68%
Operation cost 1,074,446,850.16 1,350,033,911.16 -20.41%
Sales expense 68,197,974.19 92,037,454.56 -25.90%
Administrative
298,799,463.80 262,693,939.02 13.74%
expense
Mainly increase of interest paid for
Financial expenses 9,202,486.72 1,542,054.93 496.77% increased loans in the report period
Income tax expenses 39,673,928.67 47,681,073.69 -16.79%
Input to R&D 80,416,519.61 86,173,797.02 -6.68%
Cash flow generated
by business 119,786,983.72 112,341,197.85 6.63%
operation, net
Mainly decrease of cash received from
Net cash flow
financial products and investment in
generated by -58,390,584.46 -274,500,144.16 -78.73%
the report period
investment
Net cash flow
generated by -173,780,354.77 -205,941,405.86 -15.62%
financing
Net increasing of Mainly greater increase of net cash
cash and cash -111,810,766.61 -369,600,123.01 -69.75% flow from investment in the report
equivalents period
Mainly there was an investment gain
from disposal of share equity of the
Investment income 33,668,236.76 64,696,068.76 -47.96% Packaged Equipment Co. of the Group
in the 1st half of last year.
Mainly change of receivable account
age structure: decrease of short
Asset impairment
55,223,094.46 23,595,101.44 134.04% accounts and increase of longer
loss
accounts
Mainly recording of land using rights
payment under Heavy Industry Co. –
Intangible assets 308,217,878.79 225,562,108.26 36.64% subsidiary of the Company, in the
period
No change in profit composition or sources in the report period.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(II) Progress reviewing of the business plans disclosed in previous periodic report
1. Keep on technical innovation. In the report period, the Company launched 100K class air separation project,
water supply for million class power plant, water pumping steam turbine for nuclear power plant, and key unites
of residual thermal turbine; accelerated development of high power low-pressure turbine, launched research of
large steam turbine module, as well as the development of first organic agent residual thermal power industrial
steam turbine.
The R&D project of steam turbine for million scale ethylene equipment was awarded the 1st prize by Provincial
Department of Machinery Industry, and 1st prize of China Petroleum Group for technical progress. The Steam
Turbine Rotator Dynamic Research, which is a provincial project, was completed and passed in the acceptance
test.
Government subsidies were awarded to the Company for its significant contributions to producing of national
standard for the whole industry. A number of technical researches were conducted in the report period. 12
applications were raised for patents, and 5 patents were granted.
2. Market exploring. As impacted by the overall market situation, the Company’s accepting of new orders was
declining. However the Company has reinforced its share in the market of coal chemistry, thermal power, air
conductor, and petroleum chemistry against its advantages in technologies and reputation. Winning of the contract
for the 1st installation of 100K air separation device for Shenhua Ningmei is a symbol of the Company’s invading
of the field of large air separation equipment of coal chemistry industry.
Back-pressure steam turbines, the Company’s product, are well accepted in the power plant field and under further
promotion. Facing severe competition in this field, the Company was doing its best in expanding sales and lifting
service value.
Along with the economic recovering of developing countries, the Company has reinforced marketing approach in
overseas markets. On the other side, the Company got no new orders in the gas turbine area, which was suffering
from continuous deficit of metallurgy industry. However the gas turbines in operation has contributed RMB40
million of turnover from service providing. Compressor products were in cultivating stage and not yet making
steady profit.
3. Pursuing of management upgrading. In the report period, the Company has been reinforcing internal
management, and increasing operational and economical efficiency. Great efforts have been paid on responsibility
management regarding quality control, cost, and receivable account retrieving, etc.
Continuous inspection and evaluation were performed on key performances with reference to industrial standards.
The Company has been combining resources, enhancing supply chains, and regulating process control to meet
with the requirements of complex product composition, short product circle, and frequent change of market trend.
Furthermore, the Company was continuously refining its production system, supply management, and business
process. Information technologies were further applied in management approaches. The 1st phase of PLM project
was carried out smoothly and will was expected to be put into operation recently. Great effort in energy saving
resulted a 6.98% of decrease in energy consuming per 100 million turnover.
4. Accelerating of major projects. As one of the major construction projects in the 12th 5-year-plan, Steam
Turbine Heavy Industry has accomplished its land purchasing, primary design, technical verification, and initial
assessment. It is in overall designing and planning stage at present. R&D building, the other major construction
project, has finished its primary design up to present.
The Company laid great attention on assessment and implementation of these major projects, for they will be
providing solid foundation for future development.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
III. Main business composition
In RMB Yuan
Gross Change in Change in Change in
Turnover Operation cost profit ratio turnover operation cost gross profit
% YoY YoY YoY
On Industries
Boiler and power
1,381,442,001.02 853,329,142.93 38.23% -19.15% -25.77% 5.51%
machine manufacture
Casting 34,577,265.75 24,984,782.08 27.74% -12.48% -24.10% 11.06%
Petrochemical and
other special 49,354,275.47 24,841,494.06 49.67% 27.89% -11.03% 22.02%
machineries
Other special
273,817,208.88 168,784,575.96 38.36% 21.64% 25.01% -1.66%
equipment
Sub-total 1,739,190,751.12 1,071,939,995.03 38.37% -13.55% -20.33% 5.24%
On Products
Industrial steam
1,381,442,001.02 853,329,142.93 38.23% -19.15% -25.77% 5.51%
turbine
Casting products 34,577,265.75 24,984,782.08 27.74% -12.48% -24.10% 11.06%
Auxiliary machinery 49,354,275.47 24,841,494.06 49.67% 27.89% -11.03% 22.02%
Others 273,817,208.88 168,784,575.96 38.36% 21.64% 25.01% -1.66%
Sub-total 1,739,190,751.12 1,071,939,995.03 38.37% -13.55% -20.33% 5.24%
On territories
Domestic 1,655,955,142.77 1,021,853,436.23 38.29% -7.57% -12.44% 3.43%
Overseas 83,235,608.35 50,086,558.80 39.83% -62.19% -71.92% 20.84%
Sub-total 1,739,190,751.12 1,071,939,995.03 38.37% -13.55% -20.33% 5.24%
IV. Analyze of competitive edge
As the largest developing and manufacturing base of industrial steam turbine throughout the country, the
Company has been in the territory with years of experiences, which provided obvious advantages from technical
research to production, from marketing to customer services.
There wasn’t any change in core business operation and competition in the report term. For details please find the
Annual Report 2013.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
V. Investment
1. External equity investment
(1) External investment
No external investment in the report period.
(2) Shareholding in financial enterprises
Original Opening Shareholding Shares held at Shareholding Close balance of Gain/loss in Source
Name of Type of Accounting
investment cost amount of percentage at the end of term percentage at book value report period of
companies company subject
(RMB) shares beginning (shares) closing (RMB) (RMB) shares
Bank of Long-term
Commercial Own
Hangzhou 390,954,040.00 115,593,200 6.92% 138,711,840 6.92% 390,954,040.00 23,118,640.00 share equity
Bank capital
Co., Ltd. investment
Total 390,954,040.00 115,593,200 -- 138,711,840 -- 390,954,040.00 23,118,640.00 -- --
Remark: Hangzhou Bank allotted 2 shares to each 10 shares by capital reserves basing on the total capital shares of 1671416000 shares at end of 2013. Upon
completion of this plan, the Company’s shares in Hangzhou Bank have increased from 115,593,200 to 138,711,840 shares, whereas the percentage of shareholding
has not changed.
(3) Stock investment
No securities investment in the report period.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
2. Trusted financing, derivate instruments, and trusted loans
(1) Trusted financing
In RMB10 thousand
Related transaction Amount Started Expired Mean of Principal retrieved Impairment provision Predicted Actual gain/loss of
Title of entrustee Relationship Type of product
or not entrusted on on reward this period provided (if any) income the period
Financial instruments
Bohai Bank Non-related No 2,000 2,000 9.11 9.11
of banks
Changan International Trust Co., Financial instruments
Non-related No 4,000 4,000 70.31 70.31
Ltd. of banks
Hangzhou Industrial & Commercial Financial instruments
Non-related No 12,800 987.65 376.54
Trust Co., Ltd. of banks
Financial instruments
Hangzhou Bank Non-related No 22,000 17,000 114.16 91.81
of banks
Financial instruments
Ping’an Trust Co., Ltd. Non-related No 9,000 9,000 48.37 48.46
of banks
Financial instruments
Ping An Bank Non-related No 13,000 8,000 94.5 30.88
of banks
Financial instruments
CICB Non-related No 29,900 26,100 203.06 132.08
of banks
Financial instruments
China Everbright Bank Non-related No 7,000 5,000 47.68 23.75
of banks
Financial instruments
China Minsheng Bank Non-related No 8,000 8,000 34.67 34.67
of banks
Financial instruments
Bank of China Non-related No 9,800 6,800 20.81 19.96
of banks
Financial instruments
China CITIC Bank Non-related No 22,800 18,400 157.05 117.38
of banks
Total 140,300 -- -- -- 104,300 1,787.37 954.95
Resource of capital trusted Independent
Accumulated principal and gains overdue 0
Lawsuit (if any) None
Date of announcement made by the Board about approval of trusted financial service (if any) January 27, 2014
Date of announcement made by the Shareholders’ Meeting about approval of trusted financial
None
service (if any)
(2) Investment of derivate instruments: no investment in derivate instruments in the report period.
(3) Trusted loans: No trusted loan in the report period.
3. Using of proceeds from share placing.
(1) Using of financing proceeds: not applicable
(2) Progress of committed projects to be financed by proceeds of financing: not applicable
(3) Change of usage of financing proceeds: no change of usage of financing proceeds in the report period.
(4) Progress of committed projects to be financed by proceeds of financing: not applicable
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
4. Analyze of main subsidiaries and affiliates
Profiles of main subsidiaries and affiliates
In RMB Yuan
The
Registered Operation
Name of companies Company Industry Major products or service Gross Assets Net asset Turnover Net profit
capital profit
Type
Zhejiang Steam Turbine Packaged Technology Trade of packaged Technological development of automatic control
Subsidiaries 51,000,000 281,068,680.12 90,775,621.46 110,761,508.75 14,771,378.58 10,829,298.50
Development Co., Ltd. equipment and instrument control
Hangzhou Zhongneng Steam Turbine Power
Subsidiaries Manufacturing Designing and manufacturing of steam turbines 92,500,000 825,055,442.32 294,688,362.10 371,532,267.72 36,865,742.46 32,160,463.87
Co., Ltd.
Hangzhou Steam Turbine Casting Co., Ltd. Subsidiaries Casting Iron and steel casting 22,000,000 419,349,922.68 172,630,821.25 152,915,382.21 8,087,718.67 7,384,123.09
Hangzhou Steam Turbine Machinery &
Subsidiaries Manufacturing Producing and processing of steam turbine parts 30,000,000 203,965,777.17 117,777,421.05 85,992,003.43 26,490,471.79 21,598,908.02
Equipment Co., Ltd.
Hangzhou Steam Turbine Auxiliary Machine Manufacturing of steam turbine auxiliary
Subsidiaries Manufacturing 80,000,000 442,897,674.30 245,481,424.81 225,460,305.30 26,158,708.65 20,626,167.50
Co., Ltd. machines
Zhejiang Turbine Import & Export Co., Ltd. Subsidiaries Commerce & trade International trade 20,000,000 210,545,836.35 44,968,514.33 62,173,747.89 -5,425,622.78 774,041.62
Hangzhou Steam Turbine Heavy Industry Co.,
Subsidiaries Manufacturing Designing and manufacturing of steam turbines 360,000,000 364,384,361.01 363,734,300.68 3,249,133.46 2,425,015.65
Ltd.
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
5. Major projects using non-raised capital
No major projects using non-raised capital.
VI. Business performance forecast for Jan-Sept 2014
Not applicable
VII. Statement of the Board and Supervisory Committee on the “Non-standard auditors’
report” issued by the CPA on the current report period
Not applicable
VIII. Statement of the Board on the “Non-standard auditors’ report” of previous report
period
Not applicable
IX. Profit distribution carried out in the report period
Particulars about the execution or adjustment of profit distribution, especially cash dividend and capitalizing of
capital reserves.
The profit distribution preplan of year 2013, which was proposed by the Board, was: basing on the total capital
share on December 31,2013, namely 754,010,400 shares, RMB2.00 and no bonus share(tax included) will be
distributed to each 10 shares. No capitalizing of common reserves will be implemented. Totally RMB150,802,080
will be distributed. This plan was approved by the Shareholders’ Meeting 2013 held on May 29, 2014.
The Company disclosed the “Announcement of Dividend Distribution for Year 2013” (Announcement No.
2014-29), by which the final trading day of B stocks were July 9, 2014; the ex-dividend day was July 10, 2014;
and the shareholding registration day was July 14, 2014.
The Company entrusted China Securities Registration and Clearance Co., Ltd. Shenzhen Branch to carry out the
dividend plan on July 14, 2014. Income taxes payable by the shareholders were deducted and paid by China
Securities Registration and Clearance Co., Ltd. Shenzhen Branch on behalf.
Particulars about Cash Dividend Policy
Whether satisfying the requirements of the Articles of Association or resolutions of the shareholders’ meeting Yes
Are standard and rate of dividend definite and clear Yes
Complete decision making process Yes
Independent directors fulfilling their responsibilities Yes
Whether the minority shareholders were given opportunities to express their claims or opinions, whether their
Yes
legal rights are safeguarded
Whether the conditions and procedures of adjusting cash dividend policy legal and transparent Yes
X. Profit distribution for the report period.
None of cash dividend, bonus shares, or capitalizing of common reserves will be carried out for the first half of
year.
XI. Reception of investigations, communications, or interviews
Type of
Time/date Place Way Visitors Main content involved and material provided
visitors
Mid-long term development prospect,
May 29, The Field Shareholders of
Individual competition, transferring of B stocks,
2014 Company research the Company
management incentive plans, need for financing
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter V. Significant Events
I. Administrative Position
For the report period, the Company’s actual administration practices were complying with the requirements of the Company Law and CSRC without any differences.
II. Material lawsuit
In the report period, the Company had no material lawsuits or arbitrations.
III. Questioning by the media
No media queries raised in the report period.
IV. Bankruptcy and reconstruction
No bankruptcy or capital reorganizing issues occurred in the report period.
V. Asset transactions
1. Asset acquisition: No asset acquisition occurred in the report period.
2. Disposal of assets: No disposal of assets in the report period.
3. Merger of entities: No merger of entities occurred in the report period.
VI. Implementing of share incentive scheme and influence to the Company: No share incentive scheme was implemented in the report
period
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
VII. Material related transactions
1. Related transactions related to daily operation
Ratio in Market price of Index of
Subjects of the related Principle of pricing the Price of Amount of trade Way of Date of
Related parties Relationship Type of trade similar similar trade information
transactions related transactions trade RMB0’000 payment disclosure
trades available disclosure
Hangzhou Hangfa Power Affiliate of the Purchase of Market Bank
Generators Fair and just 7,998.78 5.99% Mar 29 2014 2014-14
Generating Equipment Co., Ltd. Group goods price transfer
Hangzhou Steam Turbine
Affiliate of the Purchase of Freight, repairing, rental, Market Bank
Automobile Sales Service Co., Fair and just 2,630.04 1.97% Mar 29 2014 2014-14
Group labor passenger vehicles price transfer
Ltd.
Hangzhou Nanhua Wooden Affiliate of the Purchase of Market Bank
Packaging materials Fair and just 593.74 0.44% Mar 29 2014 2014-14
Packaging Co., Ltd. Group goods price transfer
Hangzhou Nanfangtongda Gears Affiliate of the Purchase of Market Bank
Gear boxes Fair and just 862 0.65% Mar 29 2014 2014-14
Co., Ltd. Group goods price transfer
Hangzhou Steam Turbine Affiliate of the Purchase of Materials, processing, Market Bank
Fair and just 186.71 0.14% Mar 29 2014 2014-14
Industrial Co. Group labor cleaning fees price transfer
Hangzhou Steam Turbine Power Controlling Market Bank
Accept labor Rental and power Fair and just 825.92 0.62% Mar 29 2014 2014-14
Group Co., Ltd. shareholder price transfer
Employees’ technical union, Affiliate of the Purchase of Market Bank
Material and processing Fair and just 59.91 0.04% Mar 29 2014 2014-14
HSTG Group goods price transfer
Shares held by the Purchase of Market Bank
Greenesol Co. (India) Generators Fair and just 2,143.38 1.61% Mar 29 2014 2014-14
Company goods price transfer
Hangzhou Steam Turbine Affiliate of the Sales of Market Bank
Steam turbine Fair and just 796.31 0.46% Mar 29 2014 2014-14
Engineering Co., Ltd. Group goods price transfer
Hangzhou Hangfa Power Affiliate of the Sales of Casting parts and Market Bank
Fair and just 594.84 0.34% Mar 29 2014 2014-14
Generating Equipment Co., Ltd. Group goods outsourcing price transfer
Shares held by the Sales of Market Bank
Greenesol Co. (India) Steam turbine, parts Fair and just 25.7 0.01% Mar 29 2014 2014-14
Company goods price transfer
Hangzhou Steam Turbine
Affiliate of the Sales of Market Bank
Automobile Sales Service Co., Small amount materials Fair and just 0.02 0.00% Mar 29 2014 2014-14
Group goods price transfer
Ltd.
Employees’ technical union, Affiliate of the Service Market Bank
Co-operated process fee Fair and just 20.62 0.01% Mar 29 2014 2014-14
HSTG Group providing price transfer
Total -- -- 16,737.97 -- -- -- -- --
2. Related transactions in terms of acquisition or disposal of assets:
No related transaction regarding asset purchase or disposal up to the end of report period.
3. Related transactions in term of collective external investment
No related transaction of joint external investment in the report period.
4. Debts and credits with related parties
Non-operational transaction of credits and debts with related parties: No.
5. Other material related transactions: No other material related transactions.
17
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
VIII. Non-operational capital appropriation by holding shareholder and related parties
No non-operational capital appropriation by holding shareholder or related parties occurred in the report period.
IX. Material contracts and execution
1. Entrustment, contracting, and leasing issues
(1) Entrustment: No entrustment in the report period.
(2) Contracting: No contracting in the report period.
(3) Leasing: No leasing in the report period.
18
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
2. Guarantees
In RMB10 thousand
External Guarantee (Exclude controlled subsidiaries)
Amount of Actual date of
Amount of Actual amount of Completed Related
Guarantee provided to guarantee and date occurring (signing date Type of guarantee Term
the guarantee guarantee or not guarantee
of disclosure of agreements
1 year upon
Zhongkong Science &
date of
Technology Group April 10, 2014 300 April 10, 2014 300 Pledge No No
entering the
Co., Ltd.
contract
Total of external guarantee approved in the Total of external guarantee actually occurred in the report term
300 0
report term (A1) (A2)
Total of external guarantee approved as of Total of external guarantee actually occurred as of end of report
300 0
end of report term (A3) term (A4)
Guarantee provided to controlled subsidiaries
Amount of Actual date of
Amount of Actual amount of Completed Related
Guarantee provided to guarantee and date occurring (signing date Type of guarantee Term
the guarantee guarantee or not guarantee
of disclosure of agreements
Total of guarantee to subsidiaries approved Total of guarantee to subsidiaries actually occurred in the report
0 0
in the report term (B1) term (B2)
Total of guarantee to subsidiaries approved Total of balance of guarantee actually provided to the subsidiaries
0 0
as of the report term (B3) as of end of report term (B4)
Total of guarantee provided by the Company (i.e. total of the above two items)
Total of guarantee approved in the report
300 Total of guarantee occurred in the report term (A2+B2) 0
term (A1+B1)
Total of guarantee approved as of end of
300 Total of guarantee occurred as of the end of report term（A4+B4） 0
report term (A3+B3)
In which:
Guarantees provided to the shareholders, substantial controllers and the related
0
parties (C)
Guarantee provided directly or indirectly to objects with over 70% of liability on
0
asset ratio (D)
The part of total amount of guarantee exceeded 50% of net asset (E) 0
Total of the above 3 (C+D+E) 0
Statement on the possible joint liabilities on the guarantees not due yet None
Remarks on providing of external guarantees against the procedures None
19
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(1) Illegal providing of external guarantees
No illegal providing of external guarantees in the report period.
3. Other material contracts
No other material contract in the report period.
4. Other material trades
No other material trade in the report period.
X. Commitment issues by shareholders with 5% or over of shares in the report period or
carried over to the report period from previous periods
No commitment issues by shareholders with 5% or over of shares in the report period or carried over to the
report period from previous periods
XI. Engaging and dismissing of CPAs
Whether the Interim Report was audited or not
XII. Punishment and improvement
No punishment or improving approach in the report period.
XIII. Disclosure of illegal action causing risk of delisting.
No such illegal action causes risk of delisting.
XIV. Statement on other material issues
No other material issues to be stated for the report period.
20
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter VI. Change of Share Equity and Shareholders
I. Statement of change in shares
In shares
Before the change Changed Currently (+,-) After the change
Issuing of Bonus Transferred from
Amount Proportion Others Sub-total Amount Proportion
new shares shares reserves
I. Shares with trade
479,905,341 63.65% 0 0 0 0 0 479,905,341 63.65%
restriction conditions
1. State-owned shares 479,824,800 63.64% 0 0 0 0 0 479,824,800 63.64%
2. Other domestic shares 80,541 0.01% 80,541 0.01%
Domestic natural
80,541 0.01% 0 0 0 0 0 80,541 0.01%
person shares
II. Shares without trading
274,105,059 36.35% 0 0 0 0 0 274,105,059 36.35%
limited conditions
Foreign shares listed at
274,105,059 36.35% 0 0 0 0 0 274,105,059 36.35%
home
III. Total of capital shares 754,010,400 100.00% 0 0 0 0 0 754,010,400 100.00%
II. Number of shareholders and shareholding positions
In shares
Total common shareholders at the end of Total of shareholders of preference shares with restored voting
18,981 0
the report period power at end of report period (if any)
Particulars about shareholders with over 5% of shares, or top 10 shareholders
Sharehol End of the Frozen or pledged
Changed in Amount of Amount of
Properties of ding report term
Name of the shareholder the report unconditional unconditional Status of Amou
shareholder Proporti Amount of
period shares held shares shares nt
on shares
Hangzhou Steam Turbine State-owned
63.64% 479,824,800 0 479,824,800 0
Power Group Co., Ltd. legal person
Overseas legal
NORGES BANK 0.78% 5,860,578 -109396 0 5,860,578
person
Overseas legal
GIC PRIVATE LIMITED 0.45% 3,376,460 0 0 3,376,460
person
Overseas
Li Minggong 0.43% 3,250,799 -2719175 0 3,250,799
natural person
BOCHK INVESTMENT
Overseas legal
FUNDS-BOCHK CHINA 0.31% 2,301,344 0 0 2,301,344
person
GOLDEN DRAGON FUND
AUSTRALIANSUPER PTY Overseas legal
0.28% 2,108,321 0 0 2,108,321
LTD person
Domestic
Xia Zulin 0.26% 1,925,000 194400 0 1,925,000
natural person
Overseas legal
KGI ASIA LIMITED 0.23% 1,765,389 -1100 0 1,765,389
person
VANGUARD TOTAL
Overseas legal
INTERNATIONAL STOCK 0.23% 1,704,436 201900 0 1,704,436
person
INDEX FUND
Zhu Guanhong Domestic 0.19% 1,442,588 63800 0 1,442,588
21
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
natural person
Situation of strategic investors or ordinary legal
person become one of the top 10 shareholders None
due to rights issue (if any)
(1) Hangzhou Steam Power Group Co., Ltd. is the state-owned shareholder of the Company,
all of the other owners are B-share holders.
Notes to relationship or “action in concert” (2) There is no relationship between Hangzhou Steam Turbine Power Group Co., Ltd. and
among the top ten shareholders. other shareholders;
(3) None of HSTG or other shareholders is acting-in-concert as described by Administration
Rules of Information Disclosure on Change of Shareholding Position
Top 10 holders of shares without trading limited conditions
Amount of Category of shares
Name of the shareholder unconditional shares
Category of shares Amount
held at end of period
Foreign shares placed
NORGES BANK 5,860,578 5,860,578
in domestic exchange
Foreign shares placed
GIC PRIVATE LIMITED 3,376,460 3,376,460
in domestic exchange
Foreign shares placed
Li Minggong 3,250,799 3,250,799
in domestic exchange
BOCHK INVESTMENT FUNDS-BOCHK CHINA GOLDEN DRAGON Foreign shares placed
2,301,344 2,301,344
FUND in domestic exchange
Foreign shares placed
AUSTRALIANSUPER PTY LTD 2,108,321 2,108,321
in domestic exchange
Foreign shares placed
Xia Zulin 1,925,000 1,925,000
in domestic exchange
Foreign shares placed
KGI ASIA LIMITED 1,765,389 1,765,389
in domestic exchange
Foreign shares placed
VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND 1,704,436 1,704,436
in domestic exchange
Foreign shares placed
朱冠洪 1,442,588 1,442,588
in domestic exchange
Foreign shares placed
GSIC A/C MONETARY AUTHORITY OF SINGAPORE 1,402,404 1,402,404
in domestic exchange
(1) It is unknown whether there is any relationship among the 10
unlimited share holders.
Action-in-concert among top 10 non-restricted current share holders, top 10
(2) The other shareholders are not regarded as “action-in-concert”
non-restricted current share holders and top 10 shareholders
parties as defined in the “Information Disclosure About Change of
Shareholding Status of PLCs”.
Participating of margin transactions by the top 10 shareholders (if any) Not applicable
No agreed repurchasing trade by shareholders in the report period
III. Change of holding shareholder or substantial controller
No changes in holding shareholder or substantial controller in the report period.
IV. Proposals raised by the shareholders or their action-in-concert parties about increasing of
shareholding
To the knowledge of the Company, there is not any proposal raised by the shareholders or their action-in-concert
parties about increasing of shareholding.
22
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter VII. The Preference Shares
No issue regarding preference shares in the report period.
Chapter VIII. Particulars of Directors, Supervisors, and
Management
I. Change of shareholding of directors, supervisors and senior executives
Shares
Shares Shares put Shares
holding at Shares Shares Shares
Status under under under
the increased decreased held at
Name Position of restriction at restriction restriction
beginning of this term this term the end
service beginning of in the at end of
term (shares) (shares) of term
period period period
(shares)
Wang On
Supervisor 16,056 2,100 0 18,156 0 0 0
Xiaohu duty
Total -- -- 16,056 2,100 0 18,156 0 0 0
II. Replacing of directors, supervisors, and executives
No changes happened to any of the directors, supervisors, or executives in the report period. For details please
refer to the Annual Report 2013.
23
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter IX. Financial Report
I. Auditors’ Report
The Semi-annual Financial Report is not audited.
II. The Financial Statements
All figures in the Notes to the Financial Statements are in RMB Yuan
1. Consolidated Balance Sheet
Prepared by: Hangzhou Steam Turbine Co., Ltd
In RMB Yuan
Items Closing balance Opening balance
Current asset:
Monetary capital 771,330,801.56 883,141,568.17
Settlement provision
Outgoing call loan
Transactional financial assets
Notes receivable 777,512,220.25 921,474,660.68
Account receivable 2,134,130,750.33 2,116,165,121.01
Prepayment 263,112,965.60 221,002,418.39
Insurance receivable
Reinsurance receivable
Provisions of Reinsurance contracts receivable
Interest receivable
Dividend receivable
Other account receivable 36,648,182.54 31,299,637.50
Repurchasing of financial assets
Inventories 1,783,383,959.21 1,522,662,268.44
Non-current asset due in 1 year
Other current asset 360,060,079.60 318,647,045.27
Total of current asset 6,126,178,959.09 6,014,392,719.46
Non-current assets
Disburse of consigned loans
Sellable financial asset
Expired investment in possess
Long-term receivable
Long-term share equity investment 472,349,826.87 472,349,826.87
Investment real estates
Fixed assets 575,951,378.92 609,425,345.52
Construction in process 182,879,223.36 166,904,606.60
Engineering goods
Fixed asset disposal
Production physical assets
Gas & petrol
Intangible assets 308,217,878.79 225,562,108.26
R&D expense
Goodwill
Long-term amortizable expenses 36,748.58 36,748.58
24
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Deferred income tax asset 94,839,467.12 90,477,451.14
Other non-current asset 66,500,000.00
Total of non-current assets 1,634,274,523.64 1,631,256,086.97
Total of assets 7,760,453,482.73 7,645,648,806.43
Current liabilities
Short-term loans 296,900,000.00 376,900,000.00
Loan from Central Bank
Deposit received and hold for others
Call loan received
Transactional financial liabilities
Notes payable 72,182,776.00 168,751,198.95
Account payable 944,920,884.78 778,441,385.31
Advances received 1,497,299,419.05 1,480,588,499.90
Selling of repurchased financial assets
Fees and commissions receivable
Employees’ wage payable 64,476,048.58 63,401,599.09
Tax payable 79,556,783.49 107,956,056.99
Interest payable
Dividend payable 150,802,080.00
Other account payable 33,759,075.82 46,941,539.40
Reinsurance fee payable
Insurance contract provision
Entrusted trading of securities
Entrusted selling of securities
Non-current liability due in 1 year
Other current liability
Total of current liability 3,139,897,067.72 3,022,980,279.64
Non-current liabilities
Long-term borrowings
Bond payable
Long-term payable 330,000.00 330,000.00
Special payable
Expected liabilities
Deferred income tax liability 1,017,473.05 1,017,473.05
Other non-recurring liabilities 9,966,694.00 9,700,985.00
Total of non-current liabilities 11,314,167.05 11,048,458.05
Total of liability 3,151,211,234.77 3,034,028,737.69
Owners’ equity (or shareholders’ equity)
Capital paid in (or share capital) 754,010,400.00 754,010,400.00
Capital reserves 139,590,345.09 139,590,345.09
Less: Shares in stock
Special reserves 17,527,728.53 17,276,201.15
Surplus reserves 583,824,678.05 583,824,678.05
Common risk provision
Retained profit 2,782,174,899.22 2,736,802,630.30
Different of foreign currency translation -242,221.91 -562,143.85
Total of owner’s equity belong to the parent company 4,276,885,828.98 4,230,942,110.74
Minor shareholders’ equity 332,356,418.98 380,677,958.00
Total of owners’ equity (or shareholders’ equity) 4,609,242,247.96 4,611,620,068.74
Total of liability and shareholders’ equity (or owners’ equity) 7,760,453,482.73 7,645,648,806.43
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
25
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
2. Balance Sheet of the Parent Company
Prepared by: Hangzhou Steam Turbine Co., Ltd
In RMB Yuan
Items Closing balance Opening balance
Current asset:
Monetary capital 423,425,045.57 295,292,983.14
Transactional financial assets
Notes receivable 511,432,623.94 601,340,832.00
Account receivable 1,780,365,935.39 1,788,860,441.94
Prepayment 131,824,729.51 142,783,696.27
Interest receivable
Dividend receivable
Other account receivable 34,612,116.87 25,065,309.78
Inventories 1,354,522,748.74 1,119,933,842.22
Non-current asset due in 1 year
Other current asset 64,000,000.00
Total of current asset 4,300,183,200.02 3,973,277,105.35
Non-current assets
Sellable financial asset
Expired investment in possess
Long-term receivable
Long-term share equity investment 949,669,204.90 949,669,204.90
Investment real estates
Fixed assets 292,826,104.62 316,182,652.53
Construction in process 134,333,124.98 124,088,852.72
Engineering goods
Fixed asset disposal
Production physical assets
Gas & petrol
Intangible assets 184,615,554.69 181,668,119.33
R&D expense
Goodwill
Long-term amortizable expenses
Deferred income tax asset 61,066,646.31 61,066,646.31
Other non-current asset
Total of non-current assets 1,622,510,635.50 1,632,675,475.79
26
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Total of assets 5,922,693,835.52 5,605,952,581.14
Current liabilities
Short-term loans 180,000,000.00 260,000,000.00
Transactional financial liabilities
Notes payable
Account payable 621,629,437.15 469,018,283.68
Advances received 1,032,543,344.83 1,060,240,346.99
Employees’ wage payable 44,557,415.92 49,561,769.28
Tax payable 50,202,460.59 63,656,915.72
Interest payable
Dividend payable 150,802,080.00
Other account payable 20,125,942.18 31,407,616.90
Non-current liability due in 1 year
Other current liability
Total of current liability 2,099,860,680.67 1,933,884,932.57
Non-current liabilities
Long-term borrowings
Bond payable
Long-term payable
Special payable
Expected liabilities
Deferred income tax liability 1,017,473.05 1,017,473.05
Other non-recurring liabilities 465,959.00 200,250.00
Total of non-current liabilities 1,483,432.05 1,217,723.05
Total of liability 2,101,344,112.72 1,935,102,655.62
Owners’ equity (or shareholders’ equity)
Capital paid in (or share capital) 754,010,400.00 754,010,400.00
Capital reserves 138,953,250.09 138,953,250.09
Less: Shares in stock
Special reserves 7,295,765.20 7,295,765.20
Surplus reserves 565,068,272.92 565,068,272.92
Common risk provision
Retained profit 2,356,022,034.59 2,205,522,237.31
Different of foreign currency translation
Total of owners’ equity (or shareholders’ equity) 3,821,349,722.80 3,670,849,925.52
Total of liability and shareholders’ equity (or owners’ equity) 5,922,693,835.52 5,605,952,581.14
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
27
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
3. Consolidated Income Statement
Prepared by: Hangzhou Steam Turbine Co., Ltd In RMB Yuan
Amount of the Current Amount of the Previous
Items
Term Term
I. Total revenue 1,743,362,642.27 2,019,745,830.92
Incl. Business income 1,743,362,642.27 2,019,745,830.92
Interest income
Insurance fee earned
Fee and commission received
II. Total business cost 1,517,296,543.27 1,747,271,800.06
Incl. Business cost 1,074,446,850.16 1,350,033,911.16
Interest expense
Fee and commission paid
Insurance discharge payment
Net claim amount paid
Net insurance policy reserves provided
Insurance policy dividend paid
Reinsurance expenses
Business tax and surcharge 11,426,673.94 17,369,338.95
Sales expense 68,197,974.19 92,037,454.56
Administrative expense 298,799,463.80 262,693,939.02
Financial expenses 9,202,486.72 1,542,054.93
Asset impairment loss 55,223,094.46 23,595,101.44
Plus: Gains from fluctuation of fair value (“-“ for loss)
Investment gains (“-“ for loss) 33,668,236.76 64,696,068.76
Incl. Investment gains from affiliates
Gains from currency exchange (“-“ for loss)
III. Operation profit (“-“ for loss) 259,734,335.76 337,170,099.62
Plus: Non business income 12,194,329.71 4,202,690.63
Less: Non-business expenses 4,552,652.16 4,911,095.64
Incl. Loss from disposal of non-current assets
IV. Total profit (“-“ for total loss) 267,376,013.31 336,461,694.61
Less: Income tax expenses 39,673,928.67 47,681,073.69
V. Net profit (“-“ for net loss) 227,702,084.64 288,780,620.92
Including: Net profit realized by the entity taken over
before the takover
Net profit attributable to the owners of parent company 196,174,851.01 232,926,224.38
Minor shareholders’ equity 31,527,233.63 55,854,396.54
VI. Earnings per share: -- --
(I) Basic earnings per share 0.26 0.31
(II) Diluted earnings per share 0.26 0.31
VII. Other misc. incomes 751,350.27
VIII. Total of misc. incomes 228,453,434.91 288,780,620.92
Total of misc. incomes attributable to the owners of the
196,494,772.95 232,926,224.38
parent company
Total misc gains attributable to the minor shareholders 31,958,661.96 55,854,396.54
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
28
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
4. Income Statement of the Parent Co.
Prepared by: Hangzhou Steam Turbine Co., Ltd
In RMB Yuan
Amount of the Current Amount of the Previous
Items
Term Term
I. Turnover 1,201,478,303.95 1,507,118,490.87
Less: Operation cost 781,172,768.01 1,077,683,194.39
Business tax and surcharge 6,040,737.39 12,387,170.07
Sales expense 42,538,296.57 61,114,849.26
Administrative expense 186,037,313.75 169,451,990.00
Financial expenses 8,086,889.06 -871,655.94
Asset impairment loss 49,149,559.39 16,913,497.95
Plus: Gains from fluctuation of fair value (“-“ for loss)
Investment gains (“-“ for loss) 195,852,809.48 176,498,662.56
Incl. Investment gains from affiliates
II. Operational profit (“-“ for loss) 324,305,549.26 346,938,107.70
Plus: Non business income 1,044,088.00 902,376.33
Less: Non-business expenses 2,487,972.76 3,851,456.02
Incl. Loss from disposal of non-current assets
III. Total profit (“-“ for total loss) 322,861,664.50 343,989,028.01
Less: Income tax expenses 21,559,787.22 26,182,682.84
IV. Net profit (“-“ for net loss) 301,301,877.28 317,806,345.17
V. Earnings per share -- --
(I) Basic earnings per share
(II) Diluted earnings per share
VI. Other misc gains
VII. Total of integrated income 301,301,877.28 317,806,345.17
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
29
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
5. Consolidated Cash Flow Statement
Prepared by: Hangzhou Steam Turbine Co., Ltd In RMB Yuan
Amount of the Amount of the
Items
Current Term Previous Term
I. Net cash flow from business operation
Cash received from sales of products and providing of services 1,494,144,550.03 1,652,449,867.92
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
Net increase of inter-bank fund received
Net increase of repurchasing business
Tax returned 230,602.76 6,777,141.50
Other cash received from business operation 2,670,915.77 12,593,472.87
Sub-total of cash inflow from business activities 1,497,046,068.56 1,671,820,482.29
Cash paid for purchasing of merchandise and services 784,127,440.61 986,252,669.75
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 staffs 323,206,406.63 347,910,015.56
Taxes paid 173,868,146.85 232,160,309.19
Other cash paid for business activities 96,057,090.75 -6,843,710.06
Sub-total of cash outflow from business activities 1,377,259,084.84 1,559,479,284.44
Cash flow generated by business operation, net 119,786,983.72 112,341,197.85
II. Cash flow generated by investing
Cash received from investment retrieving 28,992,269.95
Cash received as investment profit 33,668,236.76 87,226,202.37
Net cash retrieved from disposal of fixed assets, intangible assets, and other long-term assets 1,142,941.52
Net cash received from disposal of subsidiaries or other operational units -2,446,457.95
Other investment-related cash received 1,063,000,000.00 1,268,610,000.00
Sub-total of cash inflow due to investment activities 1,097,811,178.28 1,382,382,014.37
Cash paid for construction of fixed assets, intangible assets and other long-term assets 51,200,201.74 55,060,633.53
Cash paid as investment 13,211,525.00
Net increase of loan against pledge
Net cash received from subsidiaries and other operational units
Other cash paid for investment activities 1,105,001,561.00 1,588,610,000.00
Sub-total of cash outflow due to investment activities 1,156,201,762.74 1,656,882,158.53
Net cash flow generated by investment -58,390,584.46 -274,500,144.16
III. Cash flow generated by financing
Cash received as investment 729,626.40
Incl. Cash received as investment from minor shareholders
Cash received as loans 68,100,000.00 185,510,000.00
Cash received from bond placing
Other financing-related cash received
Subtotal of cash inflow from financing activities 68,829,626.40 185,510,000.00
Cash to repay debts 154,040,000.00 299,949,250.40
Cash paid as dividend, profit, or interests 88,569,981.17 91,502,155.46
Incl. Dividend and profit paid by subsidiaries to minor shareholders
Other cash paid for financing activities
Subtotal of cash outflow due to financing activities 242,609,981.17 391,451,405.86
Net cash flow generated by financing -173,780,354.77 -205,941,405.86
IV. Influence of exchange rate alternation on cash and cash equivalents 573,188.90 -1,499,770.84
V. Net increase of cash and cash equivalents -111,810,766.61 -369,600,123.01
Plus: Balance of cash and cash equivalents at the beginning of term 883,141,568.17 1,100,640,580.62
VI. Balance of cash and cash equivalents at the end of term 771,330,801.56 731,040,457.61
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
30
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
6. Cash Flow Statement of the Parent Co.
Prepared by: Hangzhou Steam Turbine Co., Ltd
In RMB Yuan
Amount of the Current Amount of the Previous
Items
Term Term
I. Net cash flow from business operation
Cash received from sales of products and providing of services 995,027,205.44 1,224,651,064.18
Tax returned
Other cash received from business operation 2,446,973.54 4,074,801.31
Sub-total of cash inflow from business activities 997,474,178.98 1,228,725,865.49
Cash paid for purchasing of merchandise and services 516,126,399.41 851,471,751.94
Cash paid to staffs or paid for staffs 227,071,963.41 247,045,937.50
Taxes paid 92,848,391.75 128,247,174.17
Other cash paid for business activities 52,823,344.01 31,615,515.48
Sub-total of cash outflow from business activities 888,870,098.58 1,258,380,379.09
Cash flow generated by business operation, net 108,604,080.40 -29,654,513.60
II. Cash flow generated by investing
Cash received from investment retrieving
Cash received as investment profit 195,852,809.48 186,698,662.56
Net cash retrieved from disposal of fixed assets, intangible assets, and
other long-term assets
Net cash received from disposal of subsidiaries or other operational units
Other investment-related cash received 334,000,000.00 1,040,000,000.00
Sub-total of cash inflow due to investment activities 529,852,809.48 1,226,698,662.56
Cash paid for construction of fixed assets, intangible assets and other
25,752,130.39 40,581,203.49
long-term assets
Cash paid as investment
Net cash received from subsidiaries and other operational units
Other cash paid for investment activities 398,000,000.00 1,330,000,000.00
Sub-total of cash outflow due to investment activities 423,752,130.39 1,370,581,203.49
Net cash flow generated by investment 106,100,679.09 -143,882,540.93
III. Cash flow generated by financing
Cash received as investment
Cash received as loans
Cash received from bond placing
Other financing-related cash received
Subtotal of cash inflow from financing activities
Cash to repay debts 80,000,000.00 100,000,000.00
Cash paid as dividend, profit, or interests 6,972,000.01 665,000.00
Other cash paid for financing activities
Subtotal of cash outflow due to financing activities 86,972,000.01 100,665,000.00
Net cash flow generated by financing -86,972,000.01 -100,665,000.00
IV. Influence of exchange rate alternation on cash and cash equivalents 399,302.95 -1,492,114.45
V. Net increase of cash and cash equivalents 128,132,062.43 -275,694,168.98
Plus: Balance of cash and cash equivalents at the beginning of term 295,292,983.14 654,577,030.60
VI. Balance of cash and cash equivalents at the end of term 423,425,045.57 378,882,861.62
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
31
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
7. Statement of Change in Owners’ Equity (Consolidated)
Prepared by: Hangzhou Steam Turbine Co., Ltd
Amount of the Current Term
In RMB Yuan
Amount of the Current Term
Owners’ Equity Attributable to the Parent Company
Items Less: Common Minor shareholders’ Total of owners’
Practical capital input
Capital reserves Shares Special reserves Surplus reserves risk Retained profit Others equity equity
(or share capital)
in stock provision
I. Balance at the end of last year 754,010,400.00 139,590,345.09 17,276,201.15 583,824,678.05 2,736,802,630.30 -562,143.85 380,677,958.00 4,611,620,068.74
Plus: Change of accounting policy
Correcting of previous errors
Others
II. Balance at the beginning of current
754,010,400.00 139,590,345.09 17,276,201.15 583,824,678.05 2,736,802,630.30 -562,143.85 380,677,958.00 4,611,620,068.74
year
III. Changed this period (“-“ for
251,527.38 45,372,268.92 319,921.94 -48,321,539.02 -2,377,820.78
decrease)
(I) Net profit 196,174,851.01 31,527,233.63 227,702,084.64
(II) Other misc. income 319,921.94 431,428.33 751,350.27
Total of (I) and (II) 196,174,851.01 319,921.94 31,958,661.96 228,453,434.91
(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 -150,802,080.00 -80,581,307.97 -231,383,387.97
1. Providing of surplus reserves
2. Common risk provision
3. Allotment to the owners (or
-150,802,080.00 -80,581,307.97 -231,383,387.97
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 251,527.38 301,430.33 552,957.71
1. Provided this year 1,689,177.58 563,714.86 2,252,892.44
2. Used this term 1,437,650.20 262,284.53 1,699,934.73
(VII) Others -502.09 -323.34 -825.43
IV. Balance at the end of this term 754,010,400.00 139,590,345.09 17,527,728.53 583,824,678.05 2,782,174,899.22 -242,221.91 332,356,418.98 4,609,242,247.96
32
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Amount of Last Year
In RMB Yuan
Amount of Last Year
Owners’ Equity Attributable to the Parent Company
Items Less: Common Minor shareholders’ Total of owners’
Capital paid in (or
Capital reserves Shares Special reserves Surplus reserves risk Retained profit Others equity equity
share capital)
in stock provision
I. Balance at the end of last year 754,010,400.00 139,590,345.09 10,294,548.34 518,540,739.23 2,449,720,889.86 456,124,350.75 4,328,281,273.27
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 current
754,010,400.00 139,590,345.09 10,294,548.34 518,540,739.23 2,449,720,889.86 456,124,350.75 4,328,281,273.27
year
III. Changed this period (“-“ for
6,981,652.81 65,283,938.82 287,081,740.44 -562,143.85 -75,446,392.75 283,338,795.47
decrease)
(I) Net profit 653,356,182.05 81,467,451.81 734,823,633.86
(II) Other misc. income -562,143.85 -758,074.88 -1,320,218.73
Total of (I) and (II) 653,356,182.05 -562,143.85 80,709,376.93 733,503,415.13
(III) Investment or decreasing of capital
-50,207,922.63 -50,207,922.63
by owners
1. Capital inputted by owners -50,207,922.63 -50,207,922.63
2. Amount of shares paid and accounted
as owners’ equity
3. Others
(IV) Profit allotment 65,283,938.82 -366,888,098.81 -106,963,952.00 -408,568,111.99
1. Providing of surplus reserves 65,283,938.82 -65,283,938.82
2. Common risk provision
3. Allotment to the owners (or
-301,604,159.99 -106,963,952.00 -408,568,111.99
shareholders)
4. Others
(V) Internal transferring of owners’
-1,886,977.19 -1,886,977.19
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 -1,886,977.19 -1,886,977.19
(VI) Special reserves 7,595,310.01 2,507,899.34 10,103,209.35
1. Provided this year 10,042,022.97 3,231,339.45 13,273,362.42
2. Used this term 2,446,712.96 723,440.11 3,170,153.07
(VII) Others -613,657.20 613,657.20 395,182.80 395,182.80
IV. Balance at the end of this term 754,010,400.00 139,590,345.09 17,276,201.15 583,824,678.05 2,736,802,630.30 -562,143.85 380,677,958.00 4,611,620,068.74
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
33
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
8. Statement of Change in Owners’ Equity (Parent Co.)
Prepared by: Hangzhou Steam Turbine Co., Ltd
Amount of the Current Term
In RMB Yuan
Amount of the Current Term
Items Capital paid in Less: Shares Common Total of
Capital reserves Special reserves Surplus reserves Retained profit
(or share capital) in stock risk provision owners’ equity
I. Balance at the end of last year 754,010,400.00 138,953,250.09 7,295,765.20 565,068,272.92 2,205,522,237.31 3,670,849,925.52
Plus: Change of accounting policy
Correcting of previous errors
Others
II. Balance at the beginning of current year 754,010,400.00 138,953,250.09 7,295,765.20 565,068,272.92 2,205,522,237.31 3,670,849,925.52
III. Changed this period (“-“ for decrease) 150,499,797.28 150,499,797.28
(I) Net profit 301,301,877.28 301,301,877.28
(II) Other misc. income
Total of (I) and (II) 301,301,877.28 301,301,877.28
(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 -150,802,080.00 -150,802,080.00
1. Providing of surplus reserves
2. Common risk provision
3. Allotment to the owners (or shareholders) -150,802,080.00 -150,802,080.00
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 1,078,331.01 1,078,331.01
2. Used this term 1,078,331.01 1,078,331.01
(VII) Others
IV. Balance at the end of this term 754,010,400.00 138,953,250.09 7,295,765.20 565,068,272.92 2,356,022,034.59 3,821,349,722.80
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Amount of Last Year
In RMB Yuan
Amount of Last Year
Items Capital paid in (or share Capital Less: Shares in Special Surplus Common risk Total of owners’
Retained profit
capital) reserves stock reserves reserves provision equity
I. Balance at the end of last year 754,010,400.00 138,953,250.09 4,671,366.80 499,784,334.10 1,919,570,947.92 3,316,990,298.91
Plus: Change of accounting policy
Correcting of previous errors
Others
II. Balance at the beginning of current
754,010,400.00 138,953,250.09 4,671,366.80 499,784,334.10 1,919,570,947.92 3,316,990,298.91
year
III. Changed this period (“-“ for decrease) 2,624,398.40 65,283,938.82 285,951,289.39 353,859,626.61
(I) Net profit 652,839,388.20 652,839,388.20
(II) Other misc. income
Total of (I) and (II) 652,839,388.20 652,839,388.20
(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 65,283,938.82 -366,888,098.81 -301,604,159.99
1. Providing of surplus reserves 65,283,938.82 -65,283,938.82
2. Common risk provision
3. Allotment to the owners (or
-301,604,159.99 -301,604,159.99
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 2,624,398.40 2,624,398.40
1. Provided this year 4,832,002.89 4,832,002.89
2. Used this term 2,207,604.49 2,207,604.49
(VII) Others
IV. Balance at the end of this term 754,010,400.00 138,953,250.09 7,295,765.20 565,068,272.92 2,205,522,237.31 3,670,849,925.52
Legal representative: Nie Zhonghai Accounting supervisor: Pu Yangshuo Manager of financial dept.: Jiang Rong
35
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
III. Company Profiles
Hangzhou Steam Turbine Co., Ltd. (the Company) was incorporated as a joint stock limited company exclusively
promoted by Hangzhou Steam Turbine & Power Group Company Limited (“HSTG”) approved by the Securities
Regulatory Commission of the State Council with the Document SRC [1998] No. 8 by offering domestically
listed foreign currency ordinary shares (B Shares), with registration date: April 23, 1998, legal entity business
license No.: 企股浙总字第002150号. The number of Business License was changed to 330000400001023 on
May 6, 2009. At incorporation the Company was registered with capital of RMB220 million, in which 80 million
B shares were issued and listed for trading in Shenzhen Stock Exchange on April 28, 1998. The Company’s
registered capital is now increased to RMB754.0104 million with total capital share of 754.0104 million shares
(face value RMB1.00). Among which state-owned legal person shares were 479.8248 million shares and 274.1856
million shares of current B shares.
The scope of main businesses of the Company: The design and manufacturing of steam turbine, gas turbine, other
rotating and to-and-fro machinery and auxiliary equipment, and spare parts and components, sales of
self-manufactured products and the provision of relevant after-sales service and import & export service.
IV. Principal Accounting Policies, Estimations and Correcting of Previous Errors
1. Basis of financial statement
The Company adopts perpetual operation as the basis of financial statements.
2. Statement of compliance to the Enterprise Accounting Standard
The finance report produced by the Company is accordance with the Enterprise Accounting Standard, and reflects
the Company’s financial state, business performance and cash flow frankly and completely.
3. Accounting period
The Company uses the calendar year for its fiscal year. A fiscal year is from January 1 to December 31.
4. Standard currency for bookkeeping
The Company uses Renminbi (RMB) as the standard currency for book keeping.
5. Accounting treatment of the merging entities under common control and different control
(1) Merger of entities under common control
Assets and liabilities acquired in merger of entities are measured at book values at the date of merger. The
difference between the net book value of asset and the offered price (or total of face value of shares issued) will be
adjusted into capital reserves; when the capital reserves is not enough to reduce, it will be adjusted into retained
profit.
(2) Merger of enterprises under different control
The difference of takeover cost over the fair value of recognizable net asset of the acquired entity is recognized as
goodwill at the day of takeover; in case the takeover cost is lower than the fair value of recognizable net asset of
the acquired entity, the measuring process over the recognizable asset, liabilities,contingent liabilities, and
takeover cost, shall be repeated, if comes out the same result, the difference shall be recorded into current income
account.
6. Accounting policies on losing of control by disposal of share equity in multiple stages
7. Preparing method of consolidated financial statements
(1) Preparation of consolidated financial statements
The parent company puts all of its subsidiaries under its control into the consolidated financial statements. The
consolidated financial statements are prepared according to the “Enterprise Accounting Standard No. 33 –
Consolidated Financial Statements”, basing on the accounts of the parent company and the subsidiaries, and after
36
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
adjusting the long-term investment equity in the subsidiary on equity basis.
(2) Accounting process on purchasing and selling, or selling and purchasing of the shares of the same
subsidiary in successively two years
8. Recognition basis of cash and cash equivalents
Cash equivalent refers to the investment held by the Company with short term, strong liquidity and lower risk of
value fluctuation that is easy to be converted into cash of known amount.
9. Translation of businesses and accounts in foreign currency
(1) Business in foreign currency
Foreign currency trades are translated into RMB at the rate of the day when the trades are made. Those balances
of foreign currencies and monetary items in foreign currencies are accounted at the exchange rate of the balance
sheet date. Exchange differences, other than special loans satisfying the conditions of capitalization, are accounted
into current income account. Non-monetary items in foreign currencies and on historical cost are translated at the
rate of the trade day. Non-monetary items in foreign currencies and on fair value are translated at the rate of the
day when the fair value is recognized, where the differences are accounted as gain/loss from change of fair value.
(2) Translating of financial statements in foreign currencies
Asset and liability items in the balance sheet are translated basing on the exchange rate of the balance sheet date;
Owners’ equities other than Retained Profit are translated at the exchange rate of the date when the trade
happened. Income and expense items in the income statement are translated at the similar rate of the date when the
trade happened. Differences generated by the above translating of foreign currencies are demonstrated separately
under the owners’ equity in the balance sheet.
10. Financial instruments
(1) Categorizing of financial instruments
Finance assets are divided initially into four types of financial asset appointed to be measured at fair value with
their changes are accounted into current gain/loss accounts(including transactional finance asset and financial
asset appointed to be measured at fair value with their changes are accounted into current gain/loss accounts),
transactional financial assets, debt and account receivable, finance asset saleable.
Finance debts are divided initially into two types of financial debt appointed to be measured at fair value with
their changes are accounted into current gain/loss accounts(including transactional finance debt and financial debt
appointed to be measured at fair value with their changes are accounted into current gain/loss accounts), other
finance debt.
(2) Recognition basis and measurement of financial instruments
When the Company is one part of the finance instrument contract, one finance asset or debt is recognized. When
on recognizing initially finance asset or debt, it is measured by fair value, for the finance asset or debt which
appointed to be measured at fair value with their changes are accounted into current gain/loss accounts, the related
transaction expenses are directly accounted into current gain and loss; for other finance asset and debt, the related
transaction expenses accounted into the initial recognition account.
The Company future measures finance asset by fair value without deducting future possible transaction fee but
with exception: (1) Due investment, debt and account receivable are measured by actual interest rate according to
the amortized costs. (2) Equity instrument investment which have no quote in active market and which fair value
can’t be measured reliably, and its derived finance assets which are connected with the equity instrument and
which are summarized through the equity instrument, are measured by cost.
The Company conduct successive measure of finance debt according to amortized cost by actual interest rate with
exception as following: (1) finance debt which appointed to be measured at fair value with their changes are
accounted into current gain/loss accounts, is measured at fir value without deducting possible future transactional
fee at settlement; (2) Equity instrument investment which have no quote in active market and which fair value
can’t be measured reliably, and its derived finance assets which are connected with the equity instrument and
37
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
which are closed off through the equity instrument, are measured by cost. (3) finance debt sponship contracts
which are not appointed to be measured at fair value with their changes are accounted into current gain/loss
accounts, or debt agreements at rate lower than market rate and which are not appointed to be measured at fair
value with their changes are accounted into current gain/loss accounts, are measured at the higher value between
the optimal estimated value payable according to current obligations and the surplus value from which the initial
recognition value deduct the accumulated amortized amount according to the actual interest rate.
Gain or loss from fluctuation of financial assets or liabilities are handled at the following ways, except for relating
to hedge instrument.
(1) Gain or loss from fluctuation of fair value of financial assets or liabilities and accounted into current gain/loss
account, are accounted into gain/loss of fluctuation of fair value. Interests or cash dividend received in the period
of holding these assets are recognized as investment gains. When they are disposed, the difference between the
amount actually received and initially booked value is recognized as investment gains, and adjust the gain/loss
from fair value fluctuation.
(2) Fluctuation of fair value of sellable financial assets accounted into capital reserves; interests gained at actual
interest rate are accounting into investment gains; the cash dividend received from sellable instrument investment,
are accounted into investment gains when distributed; At disposal of these investment, the difference between
actual amount received and book value are recognized as investment gains after deducting of accumulated change
of fair value which are originally accounted into capital reserves.
As soon as the contract rights of acquiring the cash flow of particular financial asset have been terminated or
almost all of the risks and rewards attached to the financial asset have been transferred, recognition of the
financial asset is terminated; as soon as the current liabilities attached to the financial liability have been
completely or partially relieved, recognition of the financial liability or part of is terminated.
(3) Recognition basis and measurement for transferred financial assets
The Company stop recognizing the finance asset which risks and remuneration of ownership are transferred to the
receiver; and continue to recognize the transferred finance asset which risks and remuneration of ownership are
kept, and recognize the value as one finance debt. For the finance assets which risks and remuneration of
ownership are not transferred or kept, the Company recognize them as following: (1) stop recognizing the finance
asset which are given up the control; (2) continue to recognize the finance asset and related finance debt according
to the extend which involved into the transferred finance asset for the finance asset which are not given up control.
The Company measured the surplus between the following two values for the transferred finance assets which
fulfill the stop recognition requirements into current gain or loss: (1) Account value of the transferred finance
asset; (2) Consideration plus the accumulated fair value changes which were accounted directed into ownership
rights. For the transferred finance assets which partly fulfill the stop recognition requirements the Company
amortized the stopped recognition part and the not-stopped recognition part of the account value of the whole
transferred finance asset, and account the surplus between the following two values into current gain or loss: (1)
Account value of the stopped recognition part; (2) consideration plus the corresponding stopped recognition part
of the accumulated fair value changes which were accounted directed into ownership rights.
(4) Termination condition for recognition of financial liabilities
As soon as the contract rights of acquiring the cash flow of particular financial asset have been terminated or
almost all of the risks and rewards attached to the financial asset have been transferred, recognition of the
financial asset is terminated; as soon as the current liabilities attached to the financial liability have been
completely or partially relieved, recognition of the financial liability or part of is terminated.
(5) Recognition of fair values of financial assets and liabilities
For the finance asset or debt which active market exists, the Company recognize the fair value according to the
quote on the active market; for the finance asset or debt which active market not exists, the Company recognized
the fair value using estimation technology (including reference of the latest market prices from freewill
transactions by persons familiar with conditions, reference of the current fair value of other similar finance
instrument in characteristics, discounted cash flow models and Option Pricing Model); for the initially acquired or
initial finance asset or finance debt, the Company recognize the fair value basis on the market trading price.
38
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(6) Impairment test and basis of provisions on financial assets (exclude receivable accounts)
1) The Company conduct impairment test to the finance asset other than which appointed to be measured at fair
value with their changes are accounted into current gain/loss accounts on balance sheet day. Impairment provision
is provided as long as evidence showing that impairment has happened to the financial asset.
2) The Company conduct independently impairment test for single finance asset with large value for single
finance asset with little value the Company conduct the impairment test with those of the finance asset
composition which have similar credit risk characteristics; for the non impairment assets which are tested
independently, the Company conduct the impairment test with those of the finance asset composition which have
similar credit risk characteristics.
3) For the finance asset accounted by amortized cost which have subject impairment evidence at the end term, the
impairment loss was recognized according to the difference between the account value and the anticipating future
cash flow, for the finance asset which have little difference between its short term account receivable anticipating
future cash flow and its current value, the Company don’t discount the future cash flow when recognizing related
impairment loss. When there is impairment loss for the Equity instrument investment which have no quote in
active market and which fair value can’t be measured reliably and its derived finance assets which are connected
with the equity instrument and which are calculated through the equity instrument, are measured by cost, the
difference is recognized as impairment loss between the account value of the equity instrument investment and its
derived finance asset and the current value discounted by the future cash flow according to the market profit rate
of the similar finance asset. The Company recognize the impairment loss for the saleable finance asset which fair
value have sharp decreasing and the anticipating decreasing trend is not temporary, and account it into impairment
loss together with the accumulated fair vale loss which was accounted into owner’s equity directly.
When impairment occurred with a sellable financial asset, the accumulated losses caused by decreasing of fair
value which have originally been written into owners’ equity shall be carried over to current gain/loss account. If
practical evidence showing that the value of a particular financial asset has recovered in value after a impairment
loss has been recognized and practically related to the issues occurred after recognition of the loss, the impairment
loss recognized shall be restored and accounted into current gain/loss. Impairment loss of sellable equity
investment instrument will be restored to owners’ equity when the fair value has increased afterward.
Recognition standard for impairment of sellable financial assets.
(7) If investment held to mature is re-categorized to sellable financial assets, please state th intention or
evidence of change in capability
11. Recognition standard and providing basis of bad debt provision on receivable accounts
(1) Bad debt provision on receivable accounts with major amount individually
Basis of recognition or standard amount
Accounts take over 10% of the book balance of receivable accounts
of individual account with large amount
Impairment test performed individually, bad debt provision will be
Basis of bad debt provision provided at the difference of expected cash flow lower than the book
value.
(2) Receivable accounts on which bad debt provisions are provided as groups
Name of the
Basis of bad debt provision Basis of recognition for portfolios
portfolio
Group by age
Age analysis method With similar characteristics of credit risks
analysis
Bad debt provisions are provided on age analyze basis in the portfolio
39
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Rate of provision on receivable
Age Rate of provision on other receivable accounts
accounts
Within 1 yr, (included) 5.00% 5.00%
1-2 yrs 20.00% 20.00%
2-3 years 40.00% 40.00%
Over 3 years 60.00% 60.00%
3-4 yrs 60.00% 60.00%
4-5 yrs 60.00% 60.00%
over 5 yrs 60.00% 60.00%
Bad debt provisions are provided on percentage basis in the portfolio
Not applicable
Bad debt provisions are provided on other basis in the portfolio
Not applicable
(3) Receivable accounts with minor amount but bad debt provisions are provided individually
When there is significant difference between the current value of future
Basis of providing bad debt
cash flow of the receivable account and the current value of future cash
individually
flow of the group
Impairment test performed individually, bad debt provision will be
Basis of bad debt provision provided at the difference of expected cash flow lower than the book
value.
12. Inventories
(1) Inventory classification
Inventories include saleable finished goods or merchandise, product-in-process , consumption material and goods
in manufacturing procedure or working procedure.
(2) Pricing of inventory to be delivered
Pricing basis:
Delivered out materials are accounted by weighted average method, issued out finished products are accounted at
individual price.
(3) Recognition of realizable net value of inventory and providing of inventory impairment provision
At the balance sheet day, inventories are measured at the lower of costs and cashable net values, the individual
difference between the cashable net value and cost are provided as inventory impairment provision. For finished
product, merchandise, saleable material and other saleable merchandise inventory, their cashable net values are
recognized by their estimated sale price in normal operation deducting estimated sale expenses and related taxes;
for material inventory which need processing, it cashable net value are recognized by the estimated sale prices of
its finished products in normal operation deducting the estimated cost, sale expenses and related taxes due to the
end of processing; At the balance sheet day, for inventory item which part has contract price and part has no
contract price, the cashable net value is accounted separately, and recognize the inventory impairment provision
or returnable cash..
(4) Inventory system
40
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Inventory system: perpetual inventory system
(5) Amortization of low-value consumables and packaging materials
Low price consumable
Basis of amortizing: one-off
Packaging materials
Basis of amortizing: one-off
13. Long-term equity investment
(1) Recognition of initial investment costs
1) For the long-term equity investment formed by corporate merger under common control, if it is the long-term
equity investment obtained from the corporate merger by paying cash, transferring non-cash asset, bear liability
and issuing equity securities, the share of book value of owner's equity of the merged party on the merger date
shall be taken as the initial investment cost. The asset reserve is adjusted according to the difference between the
initial investment cost of long-term equity investment and the book value of paid combined consideration or
issued securities; if the capital is not enough for deduction, the remain earnings are adjusted.
The initial investment costs of those long-term equity investment which was formed by acquisition of entities
under common control by stages are booked at the share of the book value of the owners’ equity of the entities at
the date of acquisition in the individual and consolidated financial statements. Capital reserve is adjusted by the
difference between the sum of book value of equity investment in the entities acquired and the newly increased
investment cost and the initial cost of the long-term equity; retained income shall be adjusted in case the capital
reserve is not enough to be deducted.
2) For the long-term equity investments formed by merger of enterprises under different control, the initial
investment cost is recognized by the fair value of combined consideration on purchasing day and related expenses.
Long-term equity investment formed by acquisition of entities under different control by trade in multiple stages
are accounted separately in the financial statements and consolidated financial statements.
a) In individual financial statements, initial cost of an investment is the sum of book value of the equity in the
acquired entity before the acquisition day and the newly increased investment cost at the acquisition day. In case
the share equity of the acquired entity before the acquisition day was involved in other gains, they shall be
transferred to current investment gains when the investment is disposed.
b) In the consolidated financial statements, the equity held before the acquisition day shall be recalculated on fair
value basis at the acquisition day. The differences between the book value and fair value shall be accounted into
current investment gains. In case the share equity of the acquired entity before the acquisition day was involved in
other gains, they shall be transferred to current investment gains of the current period.
3) For the long-term equity investments formed by other than merger of enterprises: if it is gotten by paying cash,
the initial investment cost is recognized by purchasing price when buy; if it is gotten by issuing equity securities,
the initial investment cost is recognized by the fair value of the securities; if it is gotten by investor’s investment,
the initial investment cost is recognized by investment contract or agreed value in contract (except the not fair
contract value).
(2) Successive measurement and recognition of gain/loss
Cost basis is adopted in accounting of those long-term equity investments by which the Company has substantial
control, and is adjusted in composing combined finance report according to equity basis; and those has no
common control or major influence without quotation in an active market and the fair value cannot be reliably
measured is also recalculated by cost basis. And equity basis is adopted in accounting of those long-term equity
investments by which the Company has joint control or major influence on the invested enterprise.
(3) Basis to recognize common control and material influence on invested entities
According to the contract, if the invested enterprise’s main finance and operation policy need to be agreed by the
other investing party, the investment is common control investment; if only have participating decision rights in
41
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
invested enterprise’s main finance and operation policy but have no own control or common control with other
investing part, the investment is investment with major influence.
(4) Impairment test and providing of impairment provisions
When physical evidence showing that the investment in subsidiaries, affiliates, and joint ventures are impaired,
impairment provision shall be provided upon the balance between the book value and retrievable value; where the
long term equity investment with no control power or significant influence and has no quotation in an active
market and the fair value cannot be reliably measured, long-term investment impairment provision will be
provided according to “Enterprise Accounting Standard No.22 – Recognition and measure of financial instrument.
14. Investment property
15. Fixed assets
(1) Recognition of fixed assets
Fixed assets is defined as the tangible assets which are held for the purpose of producing goods, providing
services, lease or for operation & management, and have more than one year of service life.
Fixed assets are booked at practical cost. Depreciation started at the next month of the asset become usable on age
average basis.
(2) Recognition and pricing of fixed asset leased by financing
Financed lease is recognized when one or several of the following conditions is satisfied:
1) The ownership over the leased asset is transferred to the lessee on expiration of the leasing period;
2) It is the lessee’s option to, or not to, buy the leased asset. However the predicted final consideration of the asset
will far lower than its original fair value. Therefore it can be rationally determined that the lessee will use its
option to buy off the asset.
3) The ownership is not transferred, but the leasing period is taking most of the service life (usually 75% or over
of the service life of the leased asset).
4) The current value of the lowest payment made by the lessee at the commencing date of the lease is almost equal
to (90% or over of) the fair value of the asset at the same date; or the current value of the lowest amount received
by the leaser at the commencing date of the lease is almost equal to (90% or over of) the fair value of the asset at
the same day;
5) The asset to be leased is specialized for the use of the lessee, namely could not be used by others without major
reconstruction.
Fixed asset leased on finance is booked at the lower one of the fair value at the commencing date and the current
value of the lowest rental.
(3) Depreciation of different fixed assets
Categories Depreciation age (year) Retain value rate Annual depreciation ratio
Houses & buildings 20-30 4.00% 4.8-3.2
Equipment & machinery 8-15 4.00% 12-6.4
Electronic equipment 5 4.00% 19.2
Transportation equipment 5 4.00% 19.2
(4) Impairment test and providing of impairment provisions on fixed assets
(5) Other remarks: no
16. Construction-in-progress
(1) Categories of construction-in-process
Construction, equipment installation, general maintenance of equipment
42
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(2) Standard and timing for transferring of construction-in-process to fixed assets
When the construction in process reaches its useful status as expected, it is transferred into fixed asset at actual
cost. If the construction in process has reached useful status but with completion of project settlement process, it is
transferred to fixed asset at the value estimated, and adjustment will happen after completion of project settlement
process but no adjustment on depreciation provided previously.
(3) Impairment test and providing of impairment provisions on construction-in-process
When there is evidence showing that the construction-in-process has impaired at the balance sheet day,
impairment provision shall be provided at the balance of the book value over the retrievable amount.
17. Borrowing expenses
(1) Principle of the recognition of capitalized borrowing costs
Loan expenses occurred in the Company, which can be categorized to purchasing or construction of assets
satisfying the conditions of capitalization, shall be capitalized and accounted into capital costs; while other loan
expenses are recognized as expenses and recorded into current income account.
(2) Capitalizing period of borrowing expenses
Capitalization started as soon as all of these conditions are satisfied: 1) Capital expenditures have occurred; 2)
Loan expenses have occurred; 3) Necessary purchasing or construction processes have been started to make the
asset usable or sellable.
(3) Temporarily suspension of capitalizing period
If irregular interruption occurred in the purchasing or construction process of the assets satisfying the capitalizing
conditions, and suspended for over successive three months, capitalizing of loan expenses is suspended; loan
expenses occurred during the suspension period are recognized as current expenses until the purchasing or
construction process resumes.
Capitalizing of borrowing expenses suspends when the asset purchased or satisfying the capitalizing conditions
reaches its useful or sellable status.
(4) Calculating of borrowing expense capitalizing
Special loans raised for purchasing or construction of assets satisfying the conditions of capitalization, interest to
be capitalized will be the actual interest expenses occurred in the current period of loan (including the discount,
premium, or amortizing decided on actual interest rate basis), less the interest income from the unused loans in
bank account or provisional investment gains; common loans used for purchasing or construction of assets
satisfying the conditions of capitalization, the interest to be capitalized will be the weighted average of balance
over special loans multiply capitalization rate of common loans.
18. Biological assets
19. Petroleum assets
20. Intangible assets
(1) Pricing of intangible assets
Intangible assets are land using rights, patents, and non-patent technologies, which are measured at cost basis.
(2) Estimation of service life of intangible assets with limited service life
For intangible assets with limited useful life, during the use life it is amortized according to the anticipating
implementation method of the economic benefit of the intangible asset systematically and reasonably. If can’t
recognize the anticipating implementation method, the straight basis is deployed.
43
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Items Expected useful life Basis
Land using right 50 On useful life of land using rights
Operation rights of waste heat power plant on actual operation term On actual business term
Others 5 Expected useful life
(3) Intangible assets without certain useful life
(4) Providing of intangible asset impairment provisions
When evidence showing that impairment occurred on intangible assets with definite useful life at the balance
sheet day, impairment provision shall be provided at the balance of book value over the retrievable value.
Impairment test shall be done on intangible assets with no definite useful life or intangible assets had not reached
the useful status, with or without evidence.
(5) Dividing of research stage and development stage of internal R&D projects
(6) Accounting of internal R&D expenses
Expenditures of internal researching projects are accounted into current term gain and loss when happens. The
development period expenditures are recognized as intangible assets when fulfill following conditions: (1) The
intangible asset is completed and technically possible to be used or sold; (2) With intention to complete the
intangible asset for purpose of use or sale; (3) Evidence showing that there are markets or the products produced
with using of the intangible asset, or markets of the intangible asset itself, by which the intangible asset may
produce financial benefits. Intangible assets used inside the Company must be approved for their usable characters.
(4) Developing of the intangible assets are supported by sufficient technical, financial, and other resources, and
the intangible assets can be used or sold. (5) Expenditures occurred in developing of the intangible asset may be
reliably measured.
21. Long-term expenses to be amortized
Long-term amortizable expenses are recorded at actual amount occurred, and straight amortized to stipulated
periods. In case a long-term expense was not benefiting the succeeding periods, then the balance of the account
shall be transferred over to current income account.
22. Asset transferring with repurchasing terms
23. Predicted liabilities
(1) Recognition of expectable liabilities
(2) Accounting of estimated liabilities
24. Share payment and equity instruments
(1) Category of share payment
(2) Recognition of fair value of equity instruments
(3) Recognition basis of best estimation of exercisable equity instruments
(4) Accounting treatment of share payment plan to be implemented, revised, and terminated
25. Repurchasing of the Company’s shares
26. Turnover
(1) Recognition time for sales of goods
Sales income is recognized when all of these conditions are satisfied: (1) Major risks and rewards attached to the
goods have been transferred to the purchaser; (2) The Company holds neither successive management power
which is normally attached to ownership, nor effective control, over the goods which have been sold out; (4)
44
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Amount of income may be reliably measured; (5) when the costs, occurred or will occur, may be measured
reliably.
Particular methods for recognition of revenue. The Company is mainly engaged in designing, manufacturing,
sales, and service of steam turbines and gas turbines falling in the range of rotating and reciprocating machinery,
and parts. Recognition of sales in the country shall satisfy: products had been delivered to the buyer and the
amount had been fixed. Payment was received or documents received with great possibility of cash inflow. And
the cost of the products is able to be measured appropriately. Recognition of sales outside the country shall satisfy:
The goods had been filed by the custom and departed with bill of lading obtained. The amount had been fixed, and
payment was received or documents received with great possibility of cash inflow. And the cost of the products is
able to be measured appropriately.
(2) Recognition of income from giving of using rights on assets
Income from giving of assets is recognized when satisfying requirements: related economic benefit flows in very
possibly, income can be measured reliably. Amount of interest income is calculated according to the time and
actual interest rate of the monetary capital is used by other party. Income of using fee is calculated upon the
charge period and calculation provided by the related contract or agreement.
(3) Basis of recognizing service income
At balance sheet day, those service trades (simultaneously satisfying the requirements of those: income can be
measured reliably, related economic benefit will flow in very possibly, transaction procedure can be confirmed
reliably, happened and happening cost can be measured reliably) which can be reliably estimated are recognized
at the percentage of completion, and progress of completion of service is decided by the portion of costs occurred
over the estimated total costs. At balance sheet day, those service trades which can not be reliably estimated, if the
happened services cost will be compensated, the services income are recognized according to happened service
cost and transited to service cost according to same amount; if the happened services cost will not be compensated,
the happened services cost are accounted into current term’s gain or loss and the services income will not be
recognized.
(4) Basis and method to determine completion progress for income from service providing and construction
contracts on percentage basis
1) When the result of the construction contract is able to be evaluated reliably at the balance sheet date, the
income and cost of the contract are recognized on completion percentage basis. If the result of the construction
contract is not able to be evaluated reliably, but the contract cost may be recovered, the income is recognized at
the cost actually recovered, and the cost of the contract is recognized as contract expenses of the current period
when it is occurred.
2) When all of the following conditions were satisfied, the result of a fix-amount contract is regarded as can be
evaluated reliably: the total income of the contract may be measured reliably, there is great possibility that the
financial benefit in relation with the contract will inflow, the actual contract costs may be identified and measured
clearly and reliably, the construction progress and the cost to occur are able to be measured reliably. When all of
the following conditions are satisfied, the result of a cost-plus-commission contract is regarded as can be
evaluated reliably: there is great possibility that the financial benefit in relation with the contract will inflow, the
actual costs may be identified and measured clearly and reliably.
3) Contract progress is recognized at the ratio of accumulative actual cost on the predicted complete cost.
4) In case the expected total cost is greater than the total income, the expected loss will be recognized as expense
of the current period. If the construction is in process, the balance is accounted as inventory impairment provision;
if the contract is not executed, the balance is accounted as expected liability.
27. Government allowance
(1) Categories
Government subsidies are divided into asset-related subsidies and income-related subsidies.
(2) Accounting policies
45
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Monetary government subsidies are measured on actual amount or receivable amount; non-monetary subsidies are
measured at fair value; when no fair value is available, measured at named amount.
Asset-related government subsidies are recognized as deferred income, amortized straight to its useful life and
recorded into current income account. Those income-related government subsidies used to makeup expenses or
losses in succeeding periods are recognized as deferred income and recorded in current income account at the
related expenses is recognized; those used to makeup expenses or losses already occurred are recorded into
current income account instantly.
28. Deferred income tax asset and deferred income tax liabilities
(1) Basis for recognition of deferred income tax assets
Deferred income tax liabilities or assets are recognized at proper rate in the term of retrieving the assets or paying
the liabilities according to difference (for not recognized assets and liabilities which tax basis can be recognized,
the difference is between the tax basis and the book value) between book value of the assets or liabilities and the
tax basis.
(2) Basis for recognition of deferred income tax liabilities
Deferred income tax liabilities or assets are recognized at proper rate in the term of retrieving the assets or paying
the liabilities according to difference (for not recognized assets and liabilities which tax basis can be recognized,
the difference is between the tax basis and the book value) between book value of the assets or liabilities and the
tax basis.
29. Operational leasing and financial leasing
(1) Accounting of operational leasing
(2) Accounting treatment of financed leasing
(3) Accounting treatment of renting back after sales
30. Sellable assets in possession
(1) Recognition of sellable assets in possession
(2) Accounting treatment of sellable assets in possession
31. Securitilization of asset
32. Hedging instruments
33. Change of main accounting policies and estimations
Is there any material change of accounting policies occurred in the year.
No
(1) Change of accounting policies
Is there any change in accounting policies in the report period
No
(2) Change of accounting estimations
Is there any change in accounting estimations in the report period
No
34. Correction of accounting errors in previous period
Is there any accounting error with previous period found in the report period: No
(1) Retrospective restatement
Is there any retrospective restatement on the accounting error with previous periods done in the report term
No
(2) Future adoption method
46
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Is there any future adoption method applicable to accounting errors with previous periods found in the report
period. No
35. Other principal accounting policies, estimations and preparation method of financial statements
V. Taxation
1. Main categories and rates of taxes
Class of tax Tax basis Tax rate
VAT sales of goods or providing of taxable labor service 17%
Operational tax Taxable turnover 5%
City maintenance and
Turnover tax payable 7%
construction tax
15%、
Enterprise income tax Amount of income taxable
25%[Note]
For those on price basis, taxes are paid at 1.2% of the balance of original
Property tax value of the property after deducting of 30%; for those on rental basis, taxes 1.2%、12%
are paid at 12% of the rental.
Education surtax Turnover tax payable 3%
Local education
Turnover tax payable 2%
surcharges
Income tax rate applicable to branches and factories.
[Note] Hangzhou Zhongneng Steam Turbine Power (Indonesia) Co., Ltd. is a subsidiary incorporated in Indonesia.
It is subject to local tax regulations.
The Company and its subsidiaries – Hangzhou Zhongneng Steam Turbine Power Co., Ltd., Hangzhou Steam
Turbine Casting Co., Ltd., Zhejiang Huayuan Steam Turbine Machinery Co., Ltd., and Hangzhou Guoneng Steam
Turbine Engineering Co., Ltd. are subject to 15% of tax, and the rest of subsidiaries (domestic) are subject to 25%
of tax.
2. Preferential tax and approving documents
(1) According to the document “Notice for Qualification of 1125 Enterprises as High-tech Enterprises” (浙科发高
〔2011〕263号) issued by Zhejiang Department of Science and Technology, Zhejiang Department of Finance,
Zhejiang National Tax Bureau, and Zhejiang Local Tax Bureau, the Company and Hangzhou Zhongneng Steam
Turbine Power Co., Ltd. – subsidy of the Company, were qualified as high-tech enterprises for term of three years.
Therefore we enjoy 15% of tax for 2011-2013.
(2) According to the document浙科发高〔2013〕294号 titled “Notice for Recognition of 491 High-tech
Enterprises” issued jointly by Zhejiang Bureau of Science and Technology, Zhejiang Bureau of Finance, Zhejiang
National Tax Bureau, and Zhenjiang Local Tax Bureau, Hangzhou Steam Turbine Casting Co., Ltd. was
recognized as a High-Tech Enterprise, therefore enjoys 15% of income tax rate from 2013 to 2015.
(3) According to document浙科发高[2011]262号 issued by Zhejiang Department of Science and Technology,
Zhejiang Huayuan Steam Turbine Machinery Co., Ltd. and Hangzhou Guoneng Steam Turbine Engineering Co.,
Ltd. were recognized as High-tech Enterprises of 2011. Hangzhou Steam Turbine Auxiliary Machinery Co., Ltd.
are enjoying the preferential tax rate of 15% for the years 2011-2013.
3. Other remarks: No
47
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
VI. Enterprise Merger and Consolidating of Financial Statements
1. Particulars of the subsidiaries
(1) Subsidiaries obtained through incorporation or investment
In RMB
Balance of the owners’
equity of parent co.
Balance of Amount for
after deducting of the
other items deducting minor
exceeding part of
actually Share Portion Minor shareholder’s
Full name of the Ownership of Business Registered 期末实际 minority shareholders’
Reg. Add. Business Scope formed net proportion of voting Consolidated? shareholders’ equity in the
subsidiary the subsidiary property capital Investment share of loss over the
investment in % rights equity minor
share of minority
the shareholder’s
shareholders in the
subsidiaries equity
owners’ equity at
beginning of year
Zhejiang Steam
Development of electrical &
Turbine Packaged
Controlled Hangzhou mechanical equipment cotrol
Technology Manufacturing 51 mil 29,800,389.56 70.86% 70.86% Yes 23,786,794.73
subsidiaries Zhejiang unit and technical consulting
Development Co.,
service
Ltd.
Designing and manufacturing
of steam turbines and
Hangzhou
supplementary equipment and
Zhongneng Steam Controlled Hangzhou
Manufacturing 92.5 mil parts; sales of the Company’s 27,644,475.06 60.83% 60.83% Yes 107,542,255.01
Turbine Power Co., subsidiaries Zhejiang
products; contracting and
Ltd.
consulting of mid-small size
power plants
Manufacturing of cast iron and
Hangzhou Steam steel products; installation and
Controlled Hangzhou
Turbine Casting Manufacturing 22 mil maintenance of casting 11,220,000.00 51.00% 51.00% Yes 84,589,102.41
subsidiaries Zhejiang
Co., Ltd. equipments; sales of the
Company’s products
Hangzhou Steam Manufacturing and processing
Turbine Machinery Controlled Hangzhou of steam turbine auxiliary parts
Manufacturing 30 mil 7,968,000.00 52.00% 52.00% Yes 56,533,317.89
& Equipment Co., subsidiaries Zhejiang and other machinery auxiliary
Ltd. parts
Hangzhou Steam
Controlled Hangzhou Manufacturing of auxiliary
Turbine Auxiliary Manufacturing 80 mil 46,286,513.41 87.53% 87.53% Yes 30,596,480.16
subsidiaries Zhejiang equipment of steam turbine
Machine Co., Ltd.
Steam turbine, gas turbine,
generator, gear box, boiler, air
cooler, condensator, power
Zhejiang Turbine plant auxiliary equipment,
Fully-owned Hangzhou
Import & Export Commerce 20 mil water turbine, air compressor, 20,000,000.00 100.00% 100.00% Yes
subsidiary Zhejiang
Co., Ltd. fan, controlling equipment,
spare parts, and materials.
Sales and assembling of the
above, import and export.
Hangzhou Steam Production: rotator machinery
Fully-owned Hangzhou RMB360
Turbine Heavy Manufacturing including steam turbines, gas 360,000,000.00 100.00% 100.00% Yes
subsidiary Zhejiang mil
Industry Co., Ltd. turbines, compressors, and
48
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
auxiliary equipment; Service:
technical developing and after
service of steam turbines, gas
turbines, compressors;
Wholesaling: steel,
construction materials
Xinjiang Taifeng Technical promotion and
Hangzhou Steam Holding interchange service;
Turbine Packaged subsidiary of Wulumuqi production, installation,
Manufacturing 20 mil 10,200,000.00 51.00% 51.00% Yes 9,158,692.94
Technologies Packaged Xinjiang maintaining, and selling of
Development Co., Tech Co. compressors, steam turbines
Ltd. and auxiliary equipment
Designing of cooling and
depressurizing equipment and
Hangzhou accessories; manufacturing
Holding
Pangtong (assembling only): cooling and
subsidiary of Hangzhou
Electronic Manufacturing 1 mil depressurizing equipment; 700,000.00 70.00% 70.00% Yes 557,988.98
Zhongneng Zhejiang
Equipment Co., wholesale and retailing:
Co.
Ltd. cooling and depressurizing
equipment and related
equipment
Sales, technical consulting,
Shijiazhuang Holding
service, adjusting, and
Hangneng Steam subsidiary of Shijiazhuang Service
3 mil maintaining of steam turbines 1,200,000.00 60.00% 60.00% Yes 1,007,952.14
Turbine Technical Zhongneng Hebei industry
and auxiliary facilities and
Services Co., Ltd. Co.
parts
Installation, testing, and
technical consulting of steam
Kunming Holding
turbines, electric generators,
Hangzhong Steam subsidiary of Kunming Service
1.2 mil and power equipment; sales of 720,000.00 60.00% 60.00% Yes 745,386.97
Turbine Technical Zhongneng Yunnan industry
parts of steam turbine, electric
Service Co., Ltd. Co.
generator, and power
equipment
Sales of steam turbines, steam
Wulumuqi machine, generator set, and
Holding
Hangzhongneng parts; developing, promotion,
subsidiary of Wulumuqi Service
Steam Turbine 3 mil service of energy-saving 1,800,000.00 60.00% 60.00% Yes 1,065,248.55
Zhongneng Xinjiang industry
Technical Service technologies, maintaining,
Co.
Co., Ltd. reconstruction of high-tech
products
Technical service, installation,
Tangshan Holding
and maintaining of steam
Hangneng Steam subsidiary of Tangshan Service
2 mil turbines; sales of steam turbine 1,200,000.00 60.00% 60.00% Yes 726,065.34
Turbine Technical Zhongneng Hebei industry
and auxiliary equipment, and
Service Co., Ltd. Co.
parts
Steam turbine and auxiliary
equipment, spare parts, testing,
repairing, technical
Jilin Holding
consultancy and service;
Hangzhongneng subsidiary of Service
Jilin 2 mil design of electro-mechanical 1,200,000.00 60.00% 60.00% Yes 816,069.26
Steam Turbine Tech Zhongneng industry
projects, chemical projects,
Service Co., Ltd. Co.
environment projects;
installation of chemical
equipment and
49
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
electro-mechanical equipment
Installation, repairing,
Guangxi Holding
technical reconstruction,
Hangzhongneng subsidiary of Nanning Service
2 mil technical service, of steam 1,200,000.00 60.00% 60.00% Yes 678,046.80
Steam Turbine Tech Zhongneng Guangxi industry
turbine; sales of steam turbine
Service Co., Ltd. Co.
parts
Development of steam turbine;
sales, installation, testing,
Holding
Chengdu maintainance, technical
subsidiary of Chengdu Service
Zhongneng Tech 2 mil consultancy and service of 1,200,000.00 60.00% 60.00% Yes 549,914.35
Zhongneng Sichuan industry
Co., Ltd. machinery, chemical products
Co.
(exclude hazard products), and
steam turbine
Holding Technical consultancy,
Luoyang Hangqi
subsidiary of Luoyang Service installation, maintainance of
Steam Turbine Tech 2 mil 1,200,000.00 60.00% 60.00% Yes 859,146.27
Zhongneng Henan industry steam turbine; sales of steam
Service Co., Ltd.
Co. turbine and parts
Production of boilers and
products; design and technical
Hangzhou Subsidiary of service of boiler, boiler parts,
Hangzhou
Hangqilun Boiler Zhongneng Manufacturing 20 mil pressure tanks, energy 1,000.00 50.00% Yes 9,680,506.08
Zhejiang
Co., Ltd. Co. products, environment
protection products; whole sale
and retailing of boilers;
Hangzhou Holding
Indonesia Industrial activities, production
Zhongneng Steam subsidiary of
Indonesia Manufacturing Rupiah 24 of steam turbine and industrial 10,750,075.00 70.00% 70.00% Yes 3,463,451.09
Zhongneng
Turbine Power Co.,
bil. boilers
Ltd. Co.
Holding
Hangzhou Kaineng Hangzhou
subsidiary of Manufacturing 2 mil Cast,forge materials 2,000,000.00 100.00% 100.00% Yes
Forge Co., Ltd. Zhejiang
Casting Co.
Zhejiang Huayuan Holding
Steam Turbine subsidiary of Huzhou Manufacturing and processing
Manufacturing 21 mil 15,750,000.00 75.00% 75.00% Yes
Machinery Co., the Machinery Zhejiang of steam turbine parts
Ltd. Co.
Production: steam turbine
Hangzhou Guoneng Holding auxiliary machine; Service:
Steam Turbine subsidiary of Hangzhou assembling, designing,
Manufacturing 40 mil 30,000,000.00 75.00% 75.00% Yes
Engineering Co., the Auxiliary Zhejiang installation, and technical
Ltd. Machine Co. consulting of packaged thermal
power projects
50
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Supplementary remarks on subsidiaries obtained through incorporation or investment
Not applicable
2. Change of consolidation range
Not applicable
3. Exchange rate of main accounts of overseas businesses
At preparing of the consolidated statements, the asset and liability items in the balance sheet of Hangzhou
Zhongneng Steam Turbine Power (Indonesia) Co., Ltd. are translated basing on the exchange rate of the balance
sheet date; Owners’ equities other than Retained Profit are translated at the exchange rate of the date when the
trade happened. Income and expense items in the income statement are translated at the similar rate of the date
when the trade happened. Differences generated by the above translating of foreign currencies are demonstrated
separately under the owners’ equity in the balance sheet.
VII. Notes to Items in the Consolidated Financial Statements
1. Monetary capital
In RMB Yuan
End of term Beginning of term
Items Amount of foreign Exchange Amount of foreign Exchange
Amount RMB Amount RMB
currency rate currency rate
Cash: -- -- 570,034.52 -- -- 641,950.41
RMB -- -- 570,034.52 -- -- 608,406.82
USD
Indonesia
67,087,185.00 0.0005 33,543.59
Rupiah
--
Bank account: -- -- 747,858,317.41 -- -- 810,286,694.06
RMB -- -- 692,545,078.14 -- -- 770,202,664.56
USD 7,097,804.23 6.1528 43,671,369.89 6,525,097.69 6.0969 39,782,868.13
JPY 3,460.00 0.0608 210.44 3,460.00 0.0578 199.99
EURO 33,528.71 8.3946 281,460.08 6.67 8.4189 56.15
HKD 0.00
Indonesia
22,720,397,720.00 0.0005 11,360,198.86 601,810,455.00 0.0005 300,905.23
Rupiah
Other
monetary -- -- 22,902,449.63 -- -- 72,212,923.70
capital
RMB -- -- 22,902,449.63 -- -- 72,212,923.70
Total -- -- 771,330,801.56 -- -- 883,141,568.17
51
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
2. Transactional financial assets
Not applicable
3. Notes receivable
(1) Categories of notes receivable
In RMB
Categories End of term Beginning of term
Bank acceptance 770,012,220.25 920,551,630.68
Commercial acceptance 7,500,000.00 923,030.00
Total 777,512,220.25 921,474,660.68
(2) Notes receivable under pledge
In RMB
Issuer Date of issue Expired on Amount Note
Rizhao Steel & Iron Rolling Co., Ltd.
October 29, 2013 April 29, 2014 5,000,000.00
Shanxi Xinbang Trade Co., Ltd. December 25 2013 June 16 2014 10,000,000.00
Shenyang Turbine Machinery Co., Ltd. November 26, 2013 May 26, 2014 10,000,000.00
Total -- -- 25,000,000.00 --
(3) Notes converted to receivable accounts due to failure of the issuer, and notes endorsed to another party
but not due yet at the end of report period
Not applicable
Notes endorsed to other parties but not due
In RMB
Issuer Date of issue Due date Amount Note
Shenyang Turbine Machinery Co., Ltd. Jan 6 2014 Jul 6 2014 10,000,000.00
Hangzhou Hangyang Holdings Co., Ltd. Apr 30 2014 Oct 30 2014 10,000,000.00
Xi’an Shanggu Power Co., Ltd. Feb 25 2014 Aug 25 2014 6,423,900.00
Xi’an Shanggu Power Co., Ltd. Mar 26 2014 Sept 26 2014 5,000,000.00
Xi’an Shanggu Power Co., Ltd. Apr 18 2014 Oct 18 2014 5,000,000.00
Total -- -- 36,423,900.00 --
4. Dividend receivable
Not applicable
52
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
5. Account receivable
(1) Account receivable presented on categories
In RMB
End of term Beginning of term
Categories Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Receivables provided bad debt provision in groups
Group by age analysis 2,646,338,724.88 98.77% 512,207,974.55 19.36% 2,573,237,853.86 98.73% 457,072,732.85 17.76%
Sub-total of group 2,646,338,724.88 98.77% 512,207,974.55 19.36% 2,573,237,853.86 98.73% 457,072,732.85 17.76%
Account receivable with
minor individual amount
33,020,480.19 1.23% 33,020,480.19 100.00% 33,020,480.19 1.27% 33,020,480.19 100.00%
but bad debt provision is
provided
Total 2,679,359,205.07 -- 545,228,454.74 -- 2,606,258,334.05 -- 490,093,213.04 --
Receivable accounts with large amount individually and bad debt provisions were provided
Not applicable
Account receivable in the portfolio which are provided bad debt provision on age basis
In RMB
End of term Beginning of term
Age Book balance Bad debt Book balance Bad debt
Amount Proportion provision Amount Proportion provision
within 1 year
In which: -- -- -- -- -- --
Subtotal of within
1,342,118,551.21 50.72% 67,244,077.57 1,472,034,979.92 57.21% 73,601,749.00
1 year
1-2 years 643,677,601.76 24.32% 128,735,520.35 552,657,917.48 21.48% 110,531,583.50
2-3 years 400,485,832.57 15.13% 160,194,333.03 280,937,867.60 10.91% 112,375,147.04
Over 3 years 260,056,739.34 9.83% 156,034,043.60 267,607,088.86 10.40% 160,564,253.31
3-4 years 120,469,994.60 4.55% 72,281,996.76 120,358,324.45 4.68% 72,214,994.67
4-5 years 55,292,766.78 2.09% 33,175,660.06 89,445,952.70 3.48% 53,667,571.62
over 5 yrs 84,293,977.96 3.19% 50,576,386.78 57,802,811.71 2.24% 34,681,687.03
Total 2,646,338,724.88 -- 512,207,974.55 2,573,237,853.86 -- 457,072,732.86
Receivable accounts in the portfolio on which bad debt provisions are provided on percentage basis
Not applicable
Receivable accounts in the portfolio on which bad debt provisions are provided on other basis
Not applicable
Receivable accounts with minor amount but on which bad debt provisions are provided individually at end
of period
In RMB
Description of the receivable accounts Book balance Bad debt provision Rate Reason to provide
17 entities including MBDL power station in India 33,020,480.19 33,020,480.19 100.00% Hard to recover
Total 33,020,480.19 33,020,480.19 -- --
(2) Receivable accounts written back or retrieved in the report period
Not applicable
(3) Receivable accounts actually written off in the report period
Not applicable
53
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(4) Particulars about the receivable accounts due from shareholders with 5% or over of the Company’s
shares
In RMB
End of term Beginning of term
Name of the companies Book Bad debt provision Book Bad debt provision
balance provided balance provided
Hangzhou Steam Turbine Power
459,000.00 220,400.00 691,500.00 226,800.00
Group Co., Ltd.
Total 459,000.00 220,400.00 691,500.00 226,800.00
(5) Top 5 debtors in the receivable accounts
In RMB
Name of the Relation with the Percentage in total
Amount Ages
companies Company receivables
Client I Non-related 734,306,431.32 over 1-3 years 27.41%
Client II Non-related 351,384,981.08 over 1-3 years 13.11%
Client III Non-related 126,596,000.00 1-2 years 4.72%
Client IV Non-related 39,780,000.00 within 1 year 1.48%
Client V Non-related 32,760,000.00 within 1 year 1.22%
Total -- 1,284,827,412.40 -- 47.94%
(6) Account due from related parties
In RMB
Relation with the Percentage in total
Name of the companies Amount
Company receivables
Shares held by the
Greenesol Co. (India) 12,621,050.25 36.58%
Company
Hangzhou Steam Turbine Power Technologies
Affiliate of the Group 3,939,071.38 11.41%
Co., Ltd.
Hangzhou Hangfa Power Generating Equipment
Affiliate of the Group 8,611,380.69 24.96%
Co., Ltd.
Hangzhou Steam Turbine Engineering Co., Ltd. Affiliate of the Group 7,321,355.99 21.22%
HSTG Packaged Equipment Co., Ltd. Affiliate of the Group 2,007,560.00 5.82%
Hangzhou Nanfangtongda Gears Co., Ltd. Affiliate of the Group 4,434.00 0.01%
Hangzhou Steam Turbine Automobile Sales
Affiliate of the Group 316.86
Service Co., Ltd.
Total 34,505,169.17 100
54
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
6. Other account receivable.
(1) Other receivable account on categories
In RMB
End of term Beginning of term
Categories Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Other receivables provided bad debt provision in groups
Group by age analysis 40,956,706.08 91.69% 4,308,523.54 10.52% 35,520,308.28 90.54% 4,220,670.78 11.88%
Sub-total of group 40,956,706.08 91.69% 4,308,523.54 10.52% 35,520,308.28 90.54% 4,220,670.78 11.88%
Other account receivable
with minor individual
3,710,320.94 8.31% 3,710,320.94 100.00% 3,710,320.94 9.46% 3,710,320.94 100.00%
amount but bad debt
provision is provided
Total 44,667,027.02 -- 8,018,844.48 -- 39,230,629.22 -- 7,930,991.72 --
Other receivable accounts with major single amount and bad debt provision drawn upon them
Not applicable
Other receivable accounts in the portfolio on which bad debt provisions are provided on age basis
In RMB Yuan
End of term Beginning of term
Age Book balance Bad debt Book balance Bad debt
Amount Proportion provision Amount Proportion provision
within 1 year
In which:
Subtotal of within 1
32,714,513.66 79.88% 1,624,384.51 26,836,337.77 75.55% 1,341,816.89
year
1-2 years 4,404,843.09 10.75% 880,968.62 5,088,625.18 14.33% 1,017,725.04
2-3 years 2,496,195.93 6.09% 998,478.37 1,480,391.73 4.17% 592,156.69
Over 3 years 1,341,153.40 3.27% 804,692.04 2,114,953.60 5.95% 1,268,972.16
3-4 years 197,199.80 0.48% 118,319.88 1,213,800.00 3.42% 731,280.00
4-5 years 250,800.00 0.61% 150,480.00 59,000.00 0.17% 35,400.00
over 5 yrs 893,153.60 2.18% 535,892.16 842,153.60 2.37% 502,292.16
Total 40,956,706.08 -- 4,308,523.54 35,520,308.28 -- 4,220,670.78
Other receivable accounts in the portfolio on which bad debt provisions are provided on percentage basis
Not applicable
Other receivable accounts in the portfolio on which bad debt provision are provided on other basis
Not applicable
Other receivable accounts with minor amount but were provided bad debt provisions individually at end of
period
55
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
In RMB
Description of other
Book balance Bad debt provision Rate Reason to provide
receivables
Customs deposit
3,710,320.94 3,710,320.94 100.00% Hard to recover
receivable
Total 3,710,320.94 3,710,320.94 -- --
(2) Other receivable accounts written back or retrieved in the report period
Not applicable
Bad debt provisions on other receivable accounts with single large amount or minor amount but tested
individually at end of report period
In RMB
Description of the
Book balance Amount of bad debt Rate Reason
receivable accounts
Customs deposit
3,710,320.94 3,710,320.94 100.00% Hard to recover
receivable
Total 3,710,320.94 3,710,320.94 -- --
(3) Other receivable accounts actually written off in the report period
Not applicable
(4) Particulars about the other receivable accounts due from shareholders with 5% or over of the
Company’s shares in the report period
Not applicable
(5) Natures or contents of other receivable accounts with large amount
Not applicable
(6) Top 5 debtors of other receivable accounts
In RMB
Relation with the Percentage in total of other
Name of the companies Amount Ages
Company receivables
within 1
Hangzhou Custom Non-related 8,333,430.78 18.66%
year
Customs deposit receivable Non-related 3,710,320.94 over 5 yrs 8.31%
within 5
Guodian Trust Bidding Co., Ltd. Non-related 2,966,800.00 6.64%
yrs
within 1
Beijing Huadian Bidding Co., Ltd. Non-related 2,100,000.00 4.70%
year
Zhejiang Chenggang Investment & within 1
Non-related 1,174,601.28 2.63%
Development Co., Ltd. year
Total -- 18,285,153.00 -- 40.94%
(7) Other accounts receivable from related parties
Not applicable
7. Prepayment
(1) Prepayment presented by ages:
In RMB
56
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
End of term Beginning of term
Age
Amount Proportion Amount Proportion
within 1 year 258,301,238.24 98.17% 180,881,123.19 81.85%
1-2 years 1,666,248.00 0.63% 36,324,675.54 16.44%
2-3 years 1,418,109.20 0.54% 1,985,200.20 0.90%
Over 3 years 1,727,370.16 0.66% 1,811,419.46 0.81%
Total 263,112,965.60 -- 221,002,418.39 --
(2) Top 5 receivers of prepayments
In RMB
Name of the companies Relation with the Company Amount Date Reason of unsettled
Client I Affiliate of the Group 29,075,825.00 1-3 years In schedule as the contract
Client II Non-related 26,705,691.60 within 1 year In schedule as the contract
Client III Non-related 25,784,804.38 within 1 year In schedule as the contract
Client IV Non-related 16,950,000.00 1-2 years In schedule as the contract
Client V Non-related 12,462,020.00 within 1 year In schedule as the contract
Total -- 110,978,340.98 -- --
(3) Prepayment received by shareholding parties holding 5% or above of the Company’s shares in the
report period
Not applicable
(4) Remarks on prepayment: payment made according to the contract
8. Inventories
(1) Categories of inventory
In RMB
End of term Beginning of term
Items Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Raw materials 396,691,900.28 396,691,900.28 387,687,751.95 387,687,751.95
Product in process 612,854,498.97 612,854,498.97 687,934,341.77 687,934,341.77
Products in stock 773,994,624.54 158,244.58 773,836,379.96 447,198,419.30 158,244.58 447,040,174.72
Material in
1,180.00 1,180.00
circulation
Total 1,783,542,203.79 158,244.58 1,783,383,959.21 1,522,820,513.02 158,244.58 1,522,662,268.44
(2) Inventory impairment provision
57
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
In RMB
Opening balance Decreased this period Closing balance of
Categories Provided this term
of book value Written back Transferred book value
Products in stock 158,244.58 158,244.58
Total 158,244.58 158,244.58
9. Other current assets
In RMB
Items End of term Beginning of term
Financial instruments of banks 360,000,000.00 318,000,000.00
Input tax deductible 58,913.18 513,038.47
Prepaid income tax 133,151.82
Tax prepaid 1,166.42 854.98
Total 360,060,079.60 318,647,045.27
58
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
10. Long-term equity investment
(1) Details of long-term equity investment
In RMB
Statement on Impairment
Percentage of Voting
Calculating Investment Opening Changed Closing differences between the Impairment provision Cash dividend of
Company invested in share in the power in
basis cost balance by balance shareholding and voting provision provided this the current term
firm % the firm %
rights term
Zhejiang Tianhang
Steam Turbine
Cost basis 10,000,000.00 10,000,000.00 10,000,000.00 33.33% 33.33% 1,000,000.00
Auxiliary Machinery
Co., Ltd.
Zhejiang Sanxin
Automatic Engineering Cost basis 600,000.00 600,000.00 600,000.00 6.00% 6.00%
Co., Ltd.
Greenesol Co. (India) Cost basis 5,534,773.22 5,534,773.22 5,534,773.22 37.00% 37.00%
Bank of Hangzhou Co.,
Cost basis 390,954,040.00 390,954,040.00 390,954,040.00 6.92% 6.92% 23,118,640.00
Ltd.
Hangzhou Steam
Turbine Engineering Cost basis 30,000,000.00 30,000,000.00 30,000,000.00 15.00% 15.00%
Co., Ltd.
Hangzhou Changdi
Equity Investment
Cost basis 20,261,013.65 20,261,013.65 20,261,013.65 2.97% 2.97%
Partnership (limited
liability)
Zhejiang Zhongkong
Solar Energy Cost basis 15,000,000.00 15,000,000.00 15,000,000.00 4.20% 4.20%
Technologies Co., Ltd.
Total -- 472,349,826.87 472,349,826.87 472,349,826.87 -- -- -- 24,118,640.00
59
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
11. Fixed assets
(1) Particulars of fixed assets
In RMB
Opening balance of Decreased this Closing balance of book
Items Increased this period
book value period value
I. Total of original book
1,349,549,137.71 8,964,365.34 6,705,874.93 1,351,807,628.12
value
Incl. House & Buildings 383,657,274.34 882,701.00 382,774,573.34
Equipment &
841,967,927.85 4,824,513.04 3,370,886.43 843,421,554.46
machinery
Office equipment 123,923,935.52 4,139,852.30 2,452,287.50 125,611,500.32
Opening balance of Increased Provided current Decreased this Balance at end of
--
book value this term term period current term
II. Total of accumulative
727,697,948.87 45,885,130.06 4,509,983.39 769,073,095.54
depreciation
Incl. House & Buildings 139,040,885.59 5,532,979.85 144,573,865.44
Equipment &
505,456,666.50 35,942,891.97 3,604,207.42 537,795,351.05
machinery
Office equipment 83,200,396.78 4,409,258.24 905,775.97 86,703,879.05
Opening balance of Balance at end of
-- --
book value current term
III. Total of net book value
621,851,188.84 -- 582,734,532.58
of fixed assets
Incl. House & Buildings 244,616,388.75 -- 238,200,707.90
Equipment &
336,511,261.35 -- 305,626,203.41
machinery
Office equipment 40,723,538.74 -- 38,907,621.27
IV. Total of impairment
12,425,843.32 -- 6,783,153.66
provisions
Incl. House & Buildings 1,504,928.24 -- 1,504,928.24
Equipment &
9,717,548.09 -- 4,074,858.43
machinery
Office equipment 1,203,366.99 -- 1,203,366.99
V. Total of fixed asset book
609,425,345.52 -- 575,951,378.92
value
Incl. House & Buildings 243,111,460.51 -- 236,695,779.66
Equipment &
326,793,713.26 -- 301,551,344.98
machinery
Office equipment 39,520,171.75 -- 37,704,254.28
Depreciation of the period was RMB45,885,130.06; transferring of construction-in-process to fixed asset by
RMB5,281,685.96.
60
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
12. Construction-in-progress
(1) Particulars of construction-in-process
In RMB
End of term Beginning of term
Items Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Construction in
process under the
129,494,119.01 129,494,119.01 122,508,059.62 122,508,059.62
parent company (195
items)
House and plants of
40,620,919.77 40,620,919.77 41,721,346.13 41,721,346.13
Casting Co. phase III
Guoneng Tangxi
7,412,861.75 7,412,861.75 1,094,407.75 1,094,407.75
workshop phase II
Measurement &
Physics-chemistry
Lab of Zhongneng
Co.
Prepayment for
4,839,005.97 4,839,005.97 1,580,793.10 1,580,793.10
equipment or projects
Preparation projects
512,316.86 512,316.86
under Heavy Industry
Total 182,879,223.36 182,879,223.36 166,904,606.60 166,904,606.60
61
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(2) Material change in construction-in-progress
In RMB
Including:
Transferred Portion of Accumulate Capitalization
Beginning of Increased this Other interest Fund
Projects Budget into fixed investment Progress of interest ratio of current End of term
term period decreases capitalized recourse
assets on budget capitalized period
this term
Construction-in-process under
157,230,000.00 118,631,518.49 11,825,871.09 963,270.57 82.97% Independent 129,494,119.01
under the HQ (195 items) construction
Construction completed
5,034,400.00 3,876,541.13 85,880.21 3,962,421.34 78.70% Completed Independent
under the HQ (51)
Preparation projects under
44,814.56 823,496.35 355,994.05 Independent 512,316.86
under Heavy Industry construction
Construction of new
under
workshops under 20,000,000.00 1,094,407.75 6,318,454.00 37.06% Independent 7,412,861.75
construction
Guoneng
House and plants of under
69,500,000.00 41,721,346.13 -1,100,426.36 58.45% Independent 40,620,919.77
Casting Co. phase III construction
Prepayment for under
1,580,793.10 3,258,212.87 Independent 4,839,005.97
equipment or projects construction
Total 251,764,400.00 166,949,421.16 21,211,488.16 5,281,685.96 -- -- -- -- 182,879,223.36
(3) Remarks on construction-in-process
Not applicable
62
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
13. Intangible assets
(1) Profiles of intangible assets
In RMB
Opening balance Increased this Decreased Closing balance of
Items
of book value period this period book value
I. Total of original book value 247,476,935.33 85,120,193.00 332,597,128.33
Land using right 246,958,635.33 85,120,193.00 332,137,128.33
Others 460,000.00 460,000.00
II. Total of accumulative
21,914,827.07 2,464,422.47 24,379,249.54
amortizing
Land using right 21,793,493.81 2,394,422.51 24,187,916.32
Others 121,333.26 69,999.96 191,333.22
III. Total of book net value of
225,562,108.26 82,655,770.53 308,217,878.79
intangible assets
Land using right 225,223,441.52 82,725,770.49 307,949,212.01
Others 338,666.74 -69,999.96 268,666.78
Land using right
Others
Total of book value of intangible
225,562,108.26 82,655,770.53 308,217,878.79
assets
Land using right 225,223,441.52 82,725,770.49 307,949,212.01
Others 338,666.74 -69,999.96 268,666.78
Amortized in the report period RMB2,464,422.47.
(2) R&D expenses
In RMB
Decreased this period
Increased this Accounted into
Items Beginning of term Recognized as End of term
period current income
intangible asset
account
Development and
7,009,659.34 63,663,569.82 67,338,006.92 3,335,222.24
research
Total 7,009,659.34 63,663,569.82 67,338,006.92 3,335,222.24
Percentage of development expense in total R&D was 84.00%.
Intangible asset formed by internal R&D of the period accounted for 0.00% of the total book value of intangible
assets.
63
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
14. Long-term expenses to be amortized
In RMB
Reason of
Beginning of Increased this Amortized this
Items Other decrease End of term other
term term term
decreasing
Redecoration 36,748.58 36,748.58
Total 36,748.58 36,748.58 --
15. Deferred income tax asset and deferred income tax liabilities
(1) Deferred income tax assets and liabilities are not presented as net amount after neutralization
Deferred income tax assets and liabilities already recognized
In RMB
Items End of term Beginning of term
Deferred income tax assets:
Asset impairment provision 86,761,695.55 81,272,348.42
Unrealized profit in consolidated accounts 6,745,018.06 7,872,349.21
Other deductible provisional difference 1,332,753.51 1,332,753.51
Sub-total 94,839,467.12 90,477,451.14
Deferred income tax liabilities:
Temporary differences of other tax
1,017,473.05 1,017,473.05
payables
Sub-total 1,017,473.05 1,017,473.05
Details of un-recognized deferred income tax assets
Not applicable
Deductible losses of the un-recognized deferred income tax asset will expire in the following years
Not applicable
Details of taxable differences and deductible differences
In RMB
Amount of temporary differences
Items
At end of term At beginning of term
Differences in taxable items
Temporary differences of other tax payables 6,783,153.66 6,783,153.66
Sub-total 6,783,153.66 6,783,153.66
Neutralizable different items
Bad debt provision 553,247,299.22 497,939,275.94
Inventory impairment provision 158,244.58 158,244.58
Fixed asset impairment provision 6,783,153.66 12,425,843.32
Impairment provision of intangible asset
Unrealized profit in consolidated accounts 44,966,787.06 47,695,840.27
Other deductible provisional difference 8,885,023.42 8,885,023.42
Sub-total 614,040,507.94 567,104,227.53
64
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(2) Deferred income tax assets and liabilities are presented as net amount after neutralization
Composition items of income tax asset and liabilities after neutralization
In RMB
Deductible or Deductible or
Deferred income Deferred income
taxable taxable
tax asset or tax asset or
provisional provisional
Items liability after liability after
difference after difference after
neutralizing at end neutralizing at end
neutralizing at end neutralizing at end
of report period of report period
of report period of report period
Deferred income tax asset 94,839,467.12 90,477,451.14
Deferred income tax liability 1,017,473.05 1,017,473.05
Details of deferred income tax asset and liabilities neutralized
Not applicable
16. Detail of asset impairment provision
In RMB
Opening balance Increased this Decreased this period Closing balance of
Items
of book value period Written back Transferred book value
I. Bad debt provision 498,024,204.76 57,809,496.44 2,586,401.98 553,247,299.22
II. Inventory
158,244.58 158,244.58
impairment provision
VII. Fixed asset
12,425,843.32 5,642,689.66 6,783,153.66
impairment provision
Total 510,608,292.66 57,809,496.44 2,586,401.98 5,642,689.66 560,188,697.46
17. Other non-current assets
In RMB
Items End of term Beginning of term
Prepayment for land 66,500,000.00
Total 66,500,000.00
Statement on other non-recurring assets
Prepayment of RMB66.50 million for land-using rights by Heavy Industry.
18. Short-term loans
(1) Categories of short-term loans
In RMB
Items End of term Beginning of term
Loan by pledge 10,000,000.00 10,000,000.00
Mortgage loan 106,900,000.00 106,900,000.00
Guarantee loan 100,000,000.00 100,000,000.00
Credit loan 80,000,000.00 160,000,000.00
Total 296,900,000.00 376,900,000.00
65
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
19. Notes payable
In RMB
Categories End of term Beginning of term
Bank acceptance 72,182,776.00 168,751,198.95
Total 72,182,776.00 168,751,198.95
RMB30,007,776.00 will due next fiscal period.
20. Account payable
(1) Account payable
In RMB
Items End of term Beginning of term
Trade 935,687,723.06 763,402,630.49
Payment for equipment and projects 9,233,161.72 15,038,754.82
Total 944,920,884.78 778,441,385.31
(2) Account payable to shareholders holding 5% or over of the Company’s shares in the report period
In RMB
Name of the companies End of term Beginning of term
Hangzhou Steam Turbine Power Group
8,631,324.39 5,266,718.60
Co., Ltd.
Total 8,631,324.39 5,266,718.60
(3) Remarks on large amount payable accounts aged for over one year
Not applicable
21. Accounts received in advance
(1) Advance payment received
In RMB
Items End of term Beginning of term
Trade 1,497,299,419.05 1,480,588,499.90
Total 1,497,299,419.05 1,480,588,499.90
(2) Prepayment collected from shareholders holding 5% or over of the Company’s shares in the report
period.
Not applicable
(3) Remarks on large amount advance payment received aged for over one year
Not applicable
66
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
22. Wage payable
In RMB
Opening balance of Increased this Decreased this Closing balance of
Items
book value period period book value
I. Wage, bonus,
30,651,466.25 208,050,513.79 233,327,913.79 5,374,066.25
allowances
II. Employees’ welfare 27,108,335.40 16,426,411.75 10,681,923.65
III. Social security 10,430,484.07 52,190,211.37 47,467,692.89 15,153,002.55
Incl. Medical insurance 3,423,841.19 22,704,522.94 17,757,145.58 8,371,218.55
Basic pension 3,861,213.58 22,338,064.18 22,800,577.54 3,398,700.22
Unemployment
592,184.91 3,097,220.72 3,201,234.05 488,171.58
insurance
Labor injury insurance 174,813.46 924,613.85 948,061.34 151,365.97
Breeding insurance 364,201.96 1,828,965.90 1,900,758.78 292,409.08
Others 2,014,228.97 1,296,823.78 859,915.60 2,451,137.15
IV. Housing fund 273,578.76 23,907,715.94 23,861,178.30 320,116.40
V. Dismissing welfare 102,256.40 177,997.10 -75,740.70
VI. Others 22,046,070.01 18,173,694.25 7,197,083.83 33,022,680.43
Incl. Annual fees 16,099,449.83 9,042,315.76 905,141.67 24,236,623.92
Trade Union finance 1,603,818.72 4,528,719.98 4,871,940.47 1,260,598.23
Training expenses 4,342,801.46 4,602,658.51 1,420,001.69 7,525,458.28
Total 63,401,599.09 329,532,727.15 328,458,277.66 64,476,048.58
Trade Union fund and employee training fund were totaled RMB8,786,056.51.
23. Tax payable
In RMB
Items End of term Beginning of term
VAT 42,841,427.85 37,144,403.03
Operational tax 243,060.00 270,524.70
Enterprise income tax 26,367,826.81 53,143,683.58
Personal income tax 1,952,450.27 9,879,947.49
City maintenance and construction tax 2,845,621.18 2,783,816.23
Education surtax 1,248,568.66 1,205,531.61
Local education surcharges 793,289.37 789,567.91
Stamp tax 13,132.90 94,049.34
Local water source foundation 2,382,220.55 2,642,286.53
Price adjustment foundation -1,031.67 2,246.57
Land using tax 868,205.00
Security fund for the disabled 2,012.57
Total 79,556,783.49 107,956,056.99
24. Interest payable
Not applicable
25. Dividend payable
In RMB
67
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Reason of overdue for one
Name of the companies End of term Beginning of term
year
Hangzhou Steam Turbine Power
95,964,960.00
Group Co., Ltd.
Foreign shares 54,837,120.00
Total 150,802,080.00 --
26. Other account payable.
(1) Other accounts payable
In RMB
Items End of term Beginning of term
Deposit 3,637,160.00 20,354,387.58
Provisional account payable 19,832,765.19 21,835,850.58
Others 10,289,150.63 4,751,301.24
Total 33,759,075.82 46,941,539.40
(2) Other account payable due to shareholders with 5% or over of the Company’s shares in the report
period
In RMB
Name of the companies End of term Beginning of term
Hangzhou Steam Turbine Power Group
1,650,985.53 18,545,102.14
Co., Ltd.
Total 1,650,985.53 18,545,102.14
(3) Statement on large amount other payable accounts due for over one year: Not applicable
(4) Statement on other receivable accounts with large amount: Not applicable
27. Predicted liabilities: Not applicable
28. Non-current liabilities due in one year
(1) Non-current liabilities due in one year
Not applicable
(2) Long-term loans due in 1 year
Long-term borrowings due in 1 year: Not applicable
Top 5 in amount of long-term borrowings due in 1 year: Not applicable
Overdue loans among the long-term borrowings due in one year: Not applicable
68
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
29. Long term payables
(1) Top 5 long-term payables
In RMB
Initial Interest Interest Closing
Unit Term Condition
amount rates payable balance
Drawing in administrative
330,000.00 330,000.00
restructuring
30. Other non-current liabilities
In RMB
Items Closing balance of book value Opening balance of book value
Deferred income (government subsidy) 9,700,985.00 9,700,985.00
Others 265,709.00
Total 9,966,694.00 9,700,985.00
Liability projects involved in government subsidy
In RMB
New
Amount transferred
Opening subsidy in Other Closing Asset-related or
Liability projects to non-operational
balance current changes balance income-related
income
period
Government subsidy
for industrial projects 748,280.00 748,280.00 Asset-related
of the 2nd half of 2006
Government subsidy
148,330.00 148,330.00 Asset-related
for recycling economy
10K ton casting line
104,000.00 104,000.00 Asset-related
enlarging project
Subsidy for industrial
upgrading by 960,000.00 960,000.00 Asset-related
provincial government
Government subsidy
6,898,545.00 6,898,545.00 Asset-related
for casting project
Production project
subsidy of 2009 of 641,580.00 641,580.00 Asset-related
Yuhang District
Subsidy for industrial
projects (including
200,250.00 200,250.00 Asset-related
transferred from
previous years)
Total 9,700,985.00 9,700,985.00 --
31. Capital Share
In RMB Yuan
Changed in the report period (+,-)
Beginning of term Issuing of new Bonus Transferred Other Sub-t End of term
shares shares from reserves s otal
Total of
754,010,400.00 754,010,400.00
capital shares
Remarks on change of share capital. If there is change in capital in the report period, name of CPA and No. of
69
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Verification Report shall be provided; for shareholding companies operated for less than three years, only net asset
need to be provided for years before establishing; for shareholding companies transformed from private limited
companies, particulars about capital verification shall be provided.
32. Shares in stock
Not applicable
33. Special reserves
Statement on special reserves
According to the document 财企〔2012〕16号 issued jointly by the Financial Department and General Bureau of
Safety Inspection on February 14, 2012, the Company provided RMB1,689,177.58 of production safety fund, and
RMB1,437,650.2 used up in the report period.
34. Capital reserves
In RMB
Decreased this
Items Beginning of term Increased this period End of term
period
Capital premium (share
81,815,220.00 81,815,220.00
capital premium)
Other capital reserves 57,775,125.09 57,775,125.09
Total 139,590,345.09 139,590,345.09
35. Surplus reserves
In RMB
Decreased this
Items Beginning of term Increased this period End of term
period
Statutory surplus reserves 583,824,678.05 583,824,678.05
Total 583,824,678.05 583,824,678.05
36. Retained profit
In RMB
Percentage of drawing or
Items Amount
allocation
Retained profit adjusted at beginning of year 2,736,802,630.30 --
Plus: Net profit attributable to owners of the parent
196,174,851.01 --
company
Common share dividend payable 150,802,080.00
Others 502.09
Retained profit at the end of term 2,782,174,899.22 --
70
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
37. Operational turnover and cost
(1) Operation incomes and costs
In RMB
Items Occurred current term Occurred in previous term
Major business turnover 1,739,190,751.12 2,011,778,885.16
Other business income 4,171,891.15 7,966,945.76
Operation cost 1,074,446,850.16 1,350,033,911.16
(2) Business segments (on industries)
In RMB
Occurred current term Occurred in previous term
Name of industry
Turnover Operation cost Turnover Operation cost
Boiler and power machine
1,381,442,001.02 853,329,142.93 1,708,584,515.78 1,149,586,834.58
manufacture
Casting 34,577,265.75 24,984,782.08 39,505,854.30 32,916,683.37
Petrochemical and other
49,354,275.47 24,841,494.06 38,590,594.80 27,922,308.08
special machineries
Control panel 2,861,860.88 2,072,932.80 37,732,042.01 33,212,160.45
Other special equipment 270,955,348.00 166,711,643.16 187,365,878.27 101,806,677.82
Total 1,739,190,751.12 1,071,939,995.03 2,011,778,885.16 1,345,444,664.30
(3) Business segments (on products)
In RMB
Occurred current term Occurred in previous term
Products or services
Turnover Operation cost Turnover Operation cost
Industrial steam turbine 1,381,442,001.02 853,329,142.93 1,708,584,515.78 1,149,586,834.58
Casting products 34,577,265.75 24,984,782.08 39,505,854.30 32,916,683.37
Auxiliary machinery 49,354,275.47 24,841,494.06 38,590,594.80 27,922,308.08
Control panel 2,861,860.88 2,072,932.80 37,732,042.01 33,212,160.45
Others 270,955,348.00 166,711,643.16 187,365,878.27 101,806,677.82
Total 1,739,190,751.12 1,071,939,995.03 2,011,778,885.16 1,345,444,664.30
(4) Business segments (on regions)
In RMB
Occurred current term Occurred in previous term
Name of districts
Turnover Operation cost Turnover Operation cost
Domestic 1,655,955,142.77 1,021,853,436.23 1,791,637,656.67 1,167,089,802.17
Overseas 83,235,608.35 50,086,558.80 220,141,228.49 178,354,862.13
Total 1,739,190,751.12 1,071,939,995.03 2,011,778,885.16 1,345,444,664.30
(5) Revenue from top five customers
In RMB
71
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Name of clients Major business turnover Portion in total turnover
Client I 448,366,121.42 25.72%
Client II 103,134,392.29 5.92%
Client III 70,000,000.02 4.02%
Client IV 43,881,371.78 2.52%
Client V 41,120,754.72 2.36%
Total 706,502,640.23 40.54%
38. Business tax and surcharge
In RMB
Occurred in previous
Items Occurred current term Rate
term
Operational tax 488,987.28 222,630.24
City maintenance and
6,332,862.90 9,964,167.81
construction tax
Education surtax 2,898,601.19 4,309,524.69
Local education surcharges 1,706,222.57 2,873,016.21
Total 11,426,673.94 17,369,338.95 --
39. Sales expenses
In RMB
Items Occurred current term Occurred in previous term
Employees’ remunerations 26,190,370.61 34,371,309.78
Freight 15,768,193.46 25,018,028.28
Business trips 9,946,751.67 9,487,436.80
Business reception expenses 3,083,101.34 4,985,108.21
Conferences 1,471,227.51 2,483,852.99
Consulting service fee 5,576,202.81 5,818,257.46
Insurance for turbine unit 446,352.77 771,129.83
Warranty expense 97,254.34 109,551.60
Office expenses 259,147.19 567,960.17
Product exhibition 521,582.74
Others 4,837,789.75 8,424,819.44
Total 68,197,974.19 92,037,454.56
40. Administrative expenses
In RMB
72
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Items Occurred current term Occurred in previous term
Employees’ remunerations 161,065,363.45 114,774,125.81
Business reception expenses 6,166,377.83 7,169,139.22
Asset depreciation and amortizing 7,032,780.50 8,393,157.73
Office expenses 1,632,507.20 2,245,688.30
Traveling fees 2,492,300.79 2,901,790.14
Taxes 5,464,108.25 6,042,551.13
House rental, property management,
4,951,988.06 2,217,251.71
water and power
Material, low-value-consumable 1,971,131.66 1,960,586.26
Maintaining 1,583,476.71 1,033,557.58
Development and research 77,853,332.85 19,757,005.97
Others 28,586,096.50 96,199,085.17
Total 298,799,463.80 262,693,939.02
41. Financial expenses
In RMB
Items Occurred current term Occurred in previous term
Interest expense 10,430,724.17 5,765,360.64
Interest income 4,439,655.78 -6,615,273.43
Exchange gains/losses 2,268,764.67 1,459,955.49
Commission 726,302.24 928,276.52
Others 216,351.42 3,735.71
Total 9,202,486.72 1,542,054.93
42. Investment income
(1) Details of investment gains
In RMB
Items Occurred current term Occurred in previous term
Long-term equity investment gains on cost basis 24,118,640.00 24,118,640.00
Investment gains from disposal of long-term equity investment 30,871,804.89
Others 9,549,596.76 9,705,623.87
Total 33,668,236.76 64,696,068.76
(2) Long-term equity investment gains on cost basis
In RMB
Occurred current Occurred in previous Causation of
Company invested in
term term change
Bank of Hangzhou Co., Ltd. 23,118,640.00 23,118,640.00
Zhejiang Tianhang Steam Turbine Auxiliary
1,000,000.00 1,000,000.00
Machinery Co., Ltd.
Total 24,118,640.00 24,118,640.00 --
43. Asset impairment loss
73
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
In RMB
Items Occurred current term Occurred in previous term
I. Bad debt loss 55,223,094.46 23,595,101.44
Total 55,223,094.46 23,595,101.44
44. Non-business income
(1) Non-operational income
In RMB
Occurred current Occurred in previous Carried to current contingent
Items
term term gain/loss
Total of gains from disposal of
347,178.69 34,710.35 347,012.69
non-current assets
Incl. Gains from disposal of fixed
347,178.69 34,710.35 347,012.69
assets
Government subsidy 4,003,211.00 2,613,328.00 4,003,211.00
Compensation income 7,693,940.02 1,013,600.00 7,693,940.02
Account not able to be paid 150,000.00 501,950.00 150,000.00
Others 39,102.28
Total 12,194,329.71 4,202,690.63 12,194,329.71
(2) Government subsidy accounted to current gain/loss account
In RMB
Occurred current Occurred in Asset-related or Non-recurring
Subsidy titles
term previous term income-related or recurring
Application of general technologies in environmental
design (including carried down from previous years) 100,000.00 Income related Yes
government subsidy
The 2nd batch of government subsidy for key development
600,000.00 Income related Yes
projects of 2012
Government award for patents 30,000.00 Income related Yes
Award for best industrial investment and technical
20,000.00 Income related Yes
reforming of Hangzhou 2011
Allowance for internship program 2012 92,852.00 Income related Yes
Allowances (technical R&D) 322,276.00 Income related Yes
Enterprise allowances from Bureau of Finance 1,448,200.00 Income related Yes
Hangzhou Economic Development Zone Bureau of
206,400.00 Income related Yes
Finance R&D Fund 2012
Enterprise Funding by Hangzhou Economy & Technology
1,866,200.00 Income related Yes
Development Zone Finance Office
Subsidy for college student internship for year 2013 by
21,671.00 Income related Yes
Hangzhou Bureau of HR and Social Security
Award for best taxpayer and technical pioneer by Tangxi
110,000.00 Income related Yes
Government
Subsidy for patents by Bureau of Science & Technology 27,500.00 Income related Yes
Science & Tech Project Awarding Fund 2014 100,000.00 Income related Yes
Subsidy for R&D 2012 630,000.00 Income related Yes
Subsidy for innovative industrial projects 2013 of
540,000.00 Income related Yes
Hangzhou
Award for technical standard 2013 500,000.00 Income related Yes
Other misc. subsidies 1,440.00 Income related Yes
Total 4,003,211.00 2,613,328.00 -- --
74
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
45. Non-business expenditures
In RMB
Occurred in previous Carried to current
Items Occurred current term
term contingent gain/loss
Incl. Loss from disposal of fixed assets 120,844.93 11,515.55 120,844.93
Donations 310,000.00 2,160,000.00 310,000.00
Penalty paid out 649,434.40 303,250.00 649,434.40
water conservancy special fund 2,353,054.95 2,107,979.65
Penalty paid 3,744.99
Penalty payment
Others 1,119,317.88 324,605.45 1,119,317.88
Total 4,552,652.16 4,911,095.64 2,199,597.21
46. Income tax expenses
In RMB
Items Occurred current term Occurred in previous term
Income tax calculated according to the law and
44,486,881.81 49,424,183.76
regulations of current term
Adjustment of deferred income tax -4,812,953.14 -1,743,110.07
Total 39,673,928.67 47,681,073.69
47. Calculation of basic earning per share and diluted earning per share
(1) Calculation process of basic earning per share
Items No. 1st half 2014
Net profit attributable to common shareholders of the Company A 196,174,851.01
Non-recurring gain/loss B 14,760,758.65
Net profit attributable to common shareholders of the Company after deducting of C=A-B 181,414,092.36
non-recurring gain/loss
Total of shares at beginning of shares D 754,010,400.00
Shares increased due to capitalizing of reserves or share dividend E
Increasing of shares by issuing of new shares or converting of debt to shares F
Total number of months from the next month of when the shares are increased to the G
end of report term
Decrease of shares caused by repurchasing H
Total number of months from the next month of when the shares are decreased to the I
end of report term
Amount of shares reduced J
Number of months in the report term K
Weighted average of common shares issued to the outside L=D+E+F×G/K-H 754,010,400.00
×I/K-J
Basic earnings per share M=A/L 0.26
Basic earning per share after deducting of non-recurring gain/loss N=C/L 0.24
48. Other miscellaneous income
In RMB
Items Occurred current term Occurred in previous term
Difference of accounting on foreign currency 751,350.27
Sub-total 751,350.27
75
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
49. Notes to the cash flow statement
(1) Other cash inflow related to operation
In RMB
Items Amount
Deposit interest 4,073,827.69
Government subsidies received 4,679,042.27
Deposit for bidding and others 320,000.00
Compensation income 6,434.94
Others -6,408,389.13
Total 2,670,915.77
(2) Other cash paid related to operation
In RMB
Items Amount
Business trips 12,061,008.28
Transportation 2,065,151.60
Business reception expenses 9,434,011.17
Maintaining 692,095.29
Property management and civil services 5,354,362.72
Deposit for bidding and others 3,490,184.58
Office expenses 6,077,175.02
Conferences 1,813,704.93
Consulting service fee 9,370,140.22
Labor service 6,219,851.61
International traveling 1,863,051.11
Transportation and vehicle using 2,810,707.20
Deposit by custom
Property insurance 957,752.63
Donations 210,000.00
Others 33,637,894.39
Total 96,057,090.75
(3) Other cash received related to investment
In RMB
Items Amount
Repurchasing of trusteeship 1,063,000,000.00
Total 1,063,000,000.00
76
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(4) Other cash paid related to investment
In RMB
Items Amount
Purchasing of financial products 1,105,001,561.00
Total 1,105,001,561.00
(5) Other cash received related to financing
Not applicable
(6) Other cash paid related to financing
Not applicable
50. Supplementary data of cash flow statement
(1) Supplementary data of cash flow statement
In RMB
Amount of the Current Amount of the Previous
Supplementary Info.
Term Term
1. Net profit adjusted to cash flow of business operation -- --
Net profit 227,702,084.64 288,780,620.92
Plus: Asset impairment provision 55,223,919.89 23,595,101.44
Fixed asset depreciation, gas and petrol depreciation,
40,989,166.35 44,963,810.43
production goods depreciation
Amortizing of intangible assets 2,381,540.21 1,824,233.48
Amortizing of long-term expenses 47,248.18
Loss from disposal of fixed assets, intangible assets, and other
226,573.76 -23,194.80
long-term assets (“-“ for gains)
Financial expenses (“-“ for gains) 12,699,488.84 1,542,054.93
Investment loss (“-“ for gains) -33,668,236.76 -64,696,068.76
Decrease of deferred income tax asset (“-“ for increase) -4,362,015.98 15,872,845.09
Decrease of inventory (“-“ for increase) -260,721,690.77 -262,066,033.88
Decrease of operational receivable items (“-“ for increase) 52,127,359.71 -297,648,810.82
Increase of operational payable items (“-“ for decrease) 27,188,793.83 360,149,391.64
Cash flow generated by business operation, net 119,786,983.72 112,341,197.85
2. Major investment and financing operation not involving with
-- --
cash
3. Net change of cash and cash equivalents -- --
Balance of cash at period end 771,330,801.56 731,040,457.61
Less: Initial balance of cash 883,141,568.17 1,100,640,580.62
Net increasing of cash and cash equivalents -111,810,766.61 -369,600,123.01
77
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(2) Information about acquisition or disposal of subsidiaries or businesses
In RMB
Supplementary Info. Occurred current term Occurred in previous term
I. Acquisition of subsidiaries and businesses -- --
II. Disposal of subsidiaries and businesses -- --
3. Net cash received for disposal of subsidiaries
-2,446,457.95
and other businesses
(3) Composition of cash and cash equivalents
In RMB
Items End of term Beginning of term
I. Cash 771,330,801.56 883,141,568.17
Incl: Cash in stock 570,034.52 641,950.41
Bank savings could be used at any time 747,858,317.41 810,286,694.06
Other monetary capital could be used at any
22,902,449.63 72,212,923.70
time
III. Balance of cash and cash equivalents at end of
771,330,801.56 883,141,568.17
term
VIII. Accounting treatment of asset securitization
1. Please state the main trade arrangement, accounting treatment, and bankruptcy isolating terms of
capital securitilizing.
2. Entities on which the Company has no control power but undertake the risks
Not applicable
78
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
IX. Related parties and related transactions
1. Parent companies of the Company
Percentage of
Voting rights Ultimate
Name of the Ownership Legal Business Registered shares of the Organization
Relationship Reg. Add. of the parent holder of the
parent co. type representative property capital parent company in code
company Company
the Company
Hangzhou
Solely Hangzhou
Steam Turbine Controlling Hangzhou RMB800
national Nie Zhonghai Manufacturing 63.64% 63.64% State Asset 14307184-2
Power Group shareholder China mil
owned Committee
Co., Ltd.
2. Subsidiaries of the Company
Ownership of the Ownership Legal Business Registered Share Portion of Organization
Full name of the subsidiary Reg. Add.
subsidiary type representative property capital proportion % voting rights code
Zhejiang Steam Turbine Packaged Controlled Hangzhou
Ltd. liability Zhen Bin Manufacturing 51 mil 70.86% 70.86% 72660016-0
Technology Development Co., Ltd. subsidiaries Zhejiang
Hangzhou Zhongneng Steam Turbine Power Controlled Hangzhou
Ltd. liability Ye Zhong Manufacturing 92.5 mil 60.83% 60.83% 14303396-9
Co., Ltd. subsidiaries Zhejiang
Controlled Hangzhou
Hangzhou Steam Turbine Casting Co., Ltd. Ltd. liability Yang Lianrong Manufacturing 22 mil 51.00% 51.00% 75950245-2
subsidiaries Zhejiang
Hangzhou Steam Turbine Machinery & Controlled Hangzhou
Ltd. liability Zhen Bin Manufacturing 30 mil 52.00% 52.00% 75954585-8
Equipment Co., Ltd. subsidiaries Zhejiang
Hangzhou Steam Turbine Auxiliary Machine Controlled Hangzhou
Ltd. liability Yu Changquan Manufacturing 80 mil 87.53% 87.53% 76549127-8
Co., Ltd. subsidiaries Zhejiang
Controlled Hangzhou
Zhejiang Turbine Import & Export Co., Ltd. Ltd. liability Zhen Bin Commerce 20 mil 100.00% 100.00% 698284761
subsidiaries Zhejiang
Hangzhou Steam Turbine Heavy Industry Controlled Hangzhou
Ltd. liability Nie Zhonghai Manufacturing 360 mil 100.00% 100.00% 07934484-1
Co., Ltd. subsidiaries Zhejiang
Xinjiang Taifeng Hangzhou Steam Turbine
Controlled Wulumuqi
Packaged Technologies Development Co., Ltd. liability Yan Jianhua Manufacturing 20 mil 51.00% 51.00% 05773639-3
subsidiaries Xinjiang
Ltd.
Hangzhou Pangtong Electronic Equipment Controlled Hangzhou
Ltd. liability Xian Jinfa Manufacturing 1 mil 70.00% 70.00% 68294625-7
Co., Ltd. subsidiaries Zhejiang
Shijiazhuang Hangneng Steam Turbine Controlled Shijiazhuang Service
Ltd. liability Fang Yongsong 3 mil 60.00% 60.00% 58241888-7
Technical Services Co., Ltd. subsidiaries Hebei industry
Kunming Hangzhong Steam Turbine Controlled Kunming Service
Ltd. liability Wanag Zhiyong 1.2 mil 60.00% 60.00% 58236606-0
Technical Service Co., Ltd. subsidiaries Yunnan industry
Wulumuqi Hangzhongneng Steam Turbine Controlled Wulumuqi Service
Ltd. liability Wang Bin 3 mil 60.00% 60.00% 58024078-X
Technical Service Co., Ltd. subsidiaries Xinjiang industry
79
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Tangshan Hangneng Steam Turbine Technical Controlled Tangshan Service
Ltd. liability Sun Xiaojiang 2 mil 60.00% 60.00% 58543834-9
Service Co., Ltd. subsidiaries Hebei industry
Jilin Hangzhongneng Steam Turbine Tech Controlled Service
Ltd. liability Jilin Lu Jianyi 2 mil 60.00% 60.00% 58464776-3
Service Co., Ltd. subsidiaries industry
Guangxi Hangzhongneng Steam Turbine Tech Controlled Nanning Service
Ltd. liability Chen Guike 2 mil 60.00% 60.00% 58981039-8
Service Co., Ltd. subsidiaries Guangxi industry
Controlled Chengdu Service
Chengdu Zhongneng Tech Co., Ltd. Ltd. liability Yang Weidong 2 mil 60.00% 60.00% 59208630-2
subsidiaries Sichuan industry
Luoyang Hangqi Steam Turbine Tech Service Controlled Luoyang Service
Ltd. liability Gao Jianhua 2 mil 60.00% 60.00% 05085500-7
Co., Ltd. subsidiaries Henan industry
Controlled Hangzhou
Hangzhou Hangqilun Boiler Co., Ltd. Ltd. liability Li Ximing Manufacturing 20 mil 50.00% 70.00% 05674402-5
subsidiaries Zhejiang
24 bil
Hangzhou Zhongneng Steam Power Controlled
Ltd. liability Indonesia Zhou Qianqian Manufacturing Indonesia 70.00% 70.00% 14303396-9
(Indonesia) Co., Ltd. subsidiaries
Rupiah
Controlled Hangzhou
Hangzhou Kaineng Forge Co., Ltd. Ltd. liability Yang Lianrong Manufacturing 2 mil 100.00% 100.00% 69170337-X
subsidiaries Zhejiang
Zhejiang Huayuan Steam Turbine Machinery Controlled Huzhou
Ltd. liability Zhen Bin Manufacturing 21 mil 75.00% 75.00% 79205170-2
Co., Ltd. subsidiaries Zhejiang
Hangzhou Guoneng Steam Turbine Controlled Hangzhou
Ltd. liability Yu Changquan Manufacturing 40 mil 75.00% 75.00% 79365592-X
Engineering Co., Ltd. subsidiaries Zhejiang
80
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
3. Other related parties
Organization
Name of the related parties Relation with the Company
code
Hangzhou Steam Turbine Automobile Sales
Affiliate of the Group 71097661-4
Service Co., Ltd.
Hangzhou Hangfa Power Generating
Affiliate of the Group 70427611-X
Equipment Co., Ltd.
Hangzhou Nanfangtongda Gears Co., Ltd. Affiliate of the Group 77080904-1
Hangzhou Nanhua Wooden Packaging Co., Ltd. Affiliate of the Group 14332633-1
Hangzhou Steam Turbine Industrial Co. Affiliate of the Group 75723721-0
Hangzhou Relian Group Co., Ltd. Affiliate of the Group 71097661-4
Hangzhou Steam Turbine Power Technologies
Affiliate of the Group 14303967-4
Co., Ltd.
HSTG Technology Association Affiliate of the Group 50190002-3
HSTG Technology Association Affiliate of the Group
Hangzhou Steam Turbine Engineering Co., Ltd. Affiliate of the Group 58320891-0
Greenesol Co. (India) Shares held by the Company
Zhongcheng Cement Co., Ltd. Former subsidary of Zhongneng Co. 69274068-2
HSTG Packaged Equipment Co., Ltd. Affiliate of the Group 66524292-8
Zhejiang Hanglian Steel & Iron Co., Ltd. Affiliate of the Group 79090691-4
Hangzhou Relian Group Co., Ltd. Affiliate of the Group 72760663-6
Hangzhou Hengsheng Thermal Power Enterprise under Zhijiangzhuang Service Company controlled by
73527700-0
Equipment Co., Ltd. minority shareholders
4. Related Transactions
(1) Purchasing of goods and services
In RMB
Occurred current term Occurred in previous term
Pricing and
Subjects of the related Ratio in Ratio in
Related parties decision making
transactions Amount similar Amount similar
process
trades trades
Hangzhou Hangfa Power
Generating Equipment Co., Generators Price on agreement 79,987,800.43 5.99% 73,342,958.09 4.55%
Ltd.
Hangzhou Steam Turbine Freight, repairing,
Automobile Sales Service Co., rental, passenger Price on agreement 26,300,402.48 1.97% 31,674,740.56 1.96%
Ltd. vehicles
Hangzhou Nanhua Wooden
Packaging materials Price on agreement 5,937,357.17 0.44% 7,372,890.00 0.46%
Packaging Co., Ltd.
Hangzhou Nanfangtongda
Gear boxes Price on agreement 8,619,991.46 0.65% 6,525,957.26 0.40%
Gears Co., Ltd.
Hangzhou Steam Turbine Materials, processing,
Price on agreement 1,867,077.55 0.14% 1,223,373.09 0.08%
Industrial Co. cleaning fees
Hangzhou Steam Turbine
Rental and power Price on agreement 8,259,161.07 0.62% 6,557,744.03 0.41%
Power Group Co., Ltd.
Employees’ technical union, Material and
Price on agreement 599,145.24 0.04%
HSTG processing
Greenesol Co. (India) Generators Price on agreement 21,433,795.50 1.61%
Hangzhou Relian International
Purchase of steel Price on agreement 365,128.21 0.02%
Trading Co.
Sub-total 153,004,730.90 11.46% 127,062,791.24 7.88%
81
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Sales of goods and services
In RMB
Occurred current term Occurred in previous term
Subjects of the Pricing and decision Ratio in Ratio in
Related parties
related transactions making process Amount similar Amount similar
trades trades
Hangzhou Steam Turbine
Small amount
Automobile Sales Service Co., Price on agreement 207.82 687.50
materials
Ltd.
Hangzhou Hangfa Power
Casting parts and
Generating Equipment Co., Price on agreement 5,948,399.41 0.34% 11,812,041.28 0.58%
outsourcing
Ltd.
Hangzhou Steam Turbine
Steam turbine Price on agreement 7,963,148.72 0.46% 42,233,643.52 2.09%
Engineering Co., Ltd.
Co-operated process
HSTG Technology Association Price on agreement 206,153.84 0.01% 54,564.10
fee
Industrial
HSTG Technology Association Price on agreement 57,692.31
co-operation
Hangzhou Steam Turbine steam turbine\
Price on agreement 962,079.24 0.05%
Power Group Co., Ltd. auxiliary machines
Greenesol Co. (India) Steam turbine, parts Price on agreement 257,008.38 0.01% 31,935.06
Sub-total 14,374,918.17 0.83% 55,152,643.01 2.72%
(2) Related leasing
The Company is the lender
Not applicable
The Company is the undertaker
In RMB
Name of the Category of Starting Ending Rental recognized
Name of the owner Pricing basis
tenant asset for rent date date in the period
Property Management The Houses & Jan 1 Dec 31 Price on
711,175.20
Branch of the Group Company plants 2013 2017 agreement
Property Management The Land using Jan 1 Dec 31 Price on
Branch of the Group Company right 2013 2017 agreement
Hangzhou Steam Turbine
The Dec 16 Dec 15 Price on
Automobile Sales Service Warehousing 951,102.00
Company 2012 2015 agreement
Co., Ltd.
Hangzhou Steam Turbine
The May 01 May 01 Price on
Automobile Sales Service Warehousing 835,536.00
Company 2013 2016 agreement
Co., Ltd.
Hangzhou Steam Turbine
The Sept 30 Price on
Automobile Sales Service Warehousing Oct 1 2013 1,105,954.00
Company 2018 agreement
Co., Ltd.
Sub-total 3,603,767.20
82
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(3) Related guarantee
In RMB
The
Completed or
The provider beneficiar Amount guaranteed Start date Due date
not
y
Hangzhou Steam Turbine The
100,000,000.00 Nov 5 2013 Nov 5 2014 No
Power Group Co., Ltd. Company
(4) Capital borrowed from related party: Not applicable
(5) Other related transactions: No
5. Receivable and payables due with related parties
Receivable accounts due from related parties
In RMB
At end of term At beginning of term
Projects Related parties Bad debt Bad debt
Book balance Book balance
provision provision
Account
Greenesol Co. (India) 12,621,050.25 961,851.77 14,528,739.91 2,788,659.15
receivable
Hangzhou Steam Turbine Power
3,939,071.38 1,616,932.43 9,179,071.38 1,835,814.28
Technologies Co., Ltd.
Hangzhou Hangfa Power
8,611,380.69 107,400.00 9,172,143.24 458,607.16
Generating Equipment Co., Ltd.
Hangzhou Steam Turbine
7,321,355.99 973,671.30 6,429,790.00 559,239.50
Engineering Co., Ltd.
Packaged Equipment Co. of the
2,007,560.00 931,012.00 2,631,260.00 720,252.00
Group
Hangzhou Steam Turbine Group 617,500.00 315200 691,500.00 226,800.00
Hangzhou Nanfangtongda Gears
4,434.00 2,660.00 4,434.00 1,773.60
Co., Ltd.
Hangzhou Steam Turbine
Automobile Sales Service Co., 316.86 15.84
Ltd.
Sub-total 23,128,198.76 3,911,922.60 42,636,938.53 6,591,145.69
Other account Hangzhou Hengsheng Thermal
2,501,375.89 125,068.79
receivable Power Equipment Co., Ltd.
Sub-total 2,501,375.89 125,068.79
Hangzhou Hangfa Power
Prepayment 29,075,825.00 32,299,825.00
Generating Equipment Co., Ltd.
Hangzhou Steam Turbine
Automobile Sales Service Co., 207,411.55 1,248,838.35
Ltd.
Hangzhou Nanfangtongda Gears
47,400.00
Co., Ltd.
Sub-total 29,283,236.55 33,596,063.35
83
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Account payable due to related parties
In RMB
Projects Related parties Amount at end of term Initial ammount
Account Hangzhou Hangfa Power Generating
89,064,038.95 93,056,053.50
payable Equipment Co., Ltd.
Hangzhou Steam Turbine Group 8,631,324.39 5,266,718.60
Hangzhou Steam Turbine Automobile Sales
4,611,579.13 2,446,593.87
Service Co., Ltd.
Hangzhou Nanhua Wooden Packaging Co.,
583,211.00 247,576.00
Ltd.
Hangzhou Steam Turbine Industrial Co. 184,951.06 114,763.46
Hangzhou Nanfangtongda Gears Co., Ltd. 4,815,000.00
Greenesol Co. (India) 0
Sub-total 119,726,175.63 101,131,705.43
Advances Hangzhou Steam Turbine Engineering Co.,
22,834,000.00 8,188,000.00
received Ltd.
HSTG Packaged Equipment Co., Ltd. 20,000.00
Hangzhou Hangfa Power Generating
724,412.99
Equipment Co., Ltd.
Greenesol Co. (India) 0
Sub-total 23,578,412.99 8,188,000.00
Other account
Hangzhou Steam Turbine Group 1,650,985.53 18,545,102.14
payable
Hangzhou Steam Turbine Automobile Sales
100,000.00 100,000.00
Service Co., Ltd.
Sub-total 1,750,985.53 18,645,102.14
X. Share payment
XI. Contingent Events
XII. Commitment events
1. Material commitment events
(I) Capital commitment occurred due to construction of new factories or purchasing of equipment were totaled to
RMB26.5616 million.
(II) The Company invested RMB10 million to be one of the partners of Hangzhou Changdi Share Investment
Partnership (with limited liabilities) in 2011. This was the initial input of capital, and the Company committed to
input supplementary capital when necessary according to the portion of interests, but not greater than RMB50
million accumulative in 8-11 years during the existing period of the firm. Extra RMB10.261 million was inputted
in 2013, accumulated to RMB20.161 million thereof.
XIII. Post Balance Sheet Issues
XIV. Other material events
1. Leasing
2. Financial assets and liabilities in foreign currencies
84
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
In RMB
Gain/loss from Accumulative change Impairment
Amount at end
Items Initial amount change of fair in fair value accounted provisions provided
of term
value in the term into equities in the current term
Financial assets
3. Loans and
249,189,673.51 217,610,187.19
receivables
Subtotal of
financial 249,189,673.51 217,610,187.19
assets
Financial
5,257,864.04 153,262.20
liabilities
3. Main contents of annual rewarding plan and material changes
4. Others
XV. Notes to the Financial Statements of the Parent Company
1. Account receivable
(1) Account receivable
In RMB
End of term Beginning of term
Categories Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Receivables provided bad debt provision in groups
Receivable
accounts within
160,781,831.10 7.26% 173,093,826.39 7.96%
the consolidation
range
Group by age
2,020,607,236.40 91.25% 401,023,132.11 19.85% 1,968,050,175.85 90.52% 352,283,560.30 17.90%
analysis
Sub-total of group 2,181,389,067.50 98.51% 401,023,132.11 18.38% 2,141,144,002.24 98.48% 352,283,560.30 16.45%
Account
receivable with
minor individual
33,020,480.19 1.49% 33,020,480.19 100.00% 33,020,480.19 1.52% 33,020,480.19 100.00%
amount but bad
debt provision is
provided
Total 2,214,409,547.69 -- 434,043,612.30 -- 2,174,164,482.43 -- 385,304,040.49 --
Receivable accounts with large amount individually and bad debt provisions were provided
Not applicable
85
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Receivable accounts in the portfolio on which bad debt provisions were provided on age basis
In RMB
End of term Beginning of term
Age Book balance Bad debt Book balance Bad debt
Amount Proportion provision Amount Proportion provision
within 1 year
In which: -- -- -- -- -- --
Subtotal of within
1,017,135,484.05 50.34% 50,856,774.20 1,165,637,194.37 59.23% 58,281,859.72
1 year
1-2 years 476,117,958.07 23.56% 95,223,591.62 368,681,471.42 18.73% 73,736,294.28
2-3 years 307,347,551.39 15.21% 122,939,020.56 199,867,498.67 10.16% 79,946,999.47
Over 3 years 220,006,242.89 10.89% 132,003,745.73 233,864,011.39 11.88% 140,318,406.83
3-4 years 94,266,292.45 4.67% 56,559,775.47 101,789,800.41 5.17% 61,073,880.25
4-5 years 49,947,470.09 2.47% 29,968,482.05 81,705,839.40 4.15% 49,023,503.64
over 5 yrs 75,792,480.35 3.75% 45,475,488.21 50,368,371.58 2.56% 30,221,022.95
Total 2,020,607,236.40 -- 401,023,132.11 1,968,050,175.85 -- 352,283,560.30
Receivable accounts in the portfolio on which bad debt provisions are provided on percentage basis
Not applicable
Receivable accounts in the portfolio on which bad debt provisions are provided on other basis
Not applicable
Receivable accounts with minor amount but on which bad debt provisions are provided individually at end
of period
In RMB
Description of the receivable accounts Book balance Bad debt provision Rate Reason to provide
MBDL Power Plant in India, etc. 33,020,480.19 33,020,480.19 100.00% Hard to recover
Total 33,020,480.19 33,020,480.19 -- --
(2) Receivable accounts practically written off in the report period
Not applicable
(3) Receivable accounts due from shareholders with 5% of shares or over
In RMB
End of term Beginning of term
Bad debt
Name of the companies Bad debt provision
Book balance provision Book balance
provided
provided
Hangzhou Steam Turbine
100,000.00 5,000.00 258,500.00 100,100.00
Power Group Co., Ltd.
Total 100,000.00 5,000.00 258,500.00 100,100.00
86
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
(4) Nature or description of other receivable accounts with larger amount
Not applicable
(5) Top 5 debtors in the receivable accounts
In RMB
Name of the Relation with the Percentage in total
Amount Ages
companies Company receivables
Client I Non-related 682,595,627.32 over 1-3 years 30.83%
Client II Non-related 351,371,981.08 over 1-3 years 15.87%
Client III Non-related 126,596,000.00 within 1 year 5.72%
Client IV Related parties 73,143,190.42 1-3 years 3.30%
Client V Related parties 62,723,288.52 over 1-3 years 2.83%
Total -- 1,296,430,087.34 -- 58.55%
(6) Account due from related parties
In RMB
Relation with the Percentage in total
Name of the companies Amount
Company receivables
Zhejiang Turbine Import & Export
Subsidiaries 73,143,190.42 3.30%
Co., Ltd.
Zhejiang Steam Turbine Packaged
Subsidiaries 62,723,288.52 2.83%
Technology Development Co., Ltd.
Zhejiang Huayuan Steam Turbine
Subsidiaries 16,446,968.96 0.74%
Machinery Co., Ltd.
Hangzhou Steam Turbine Power
Affiliate of the Group 3,939,071.38 0.18%
Technologies Co., Ltd.
Hangzhou Zhongneng Steam
Subsidiaries 2,902,500.00 0.13%
Turbine Power Co., Ltd.
Hangzhou Steam Turbine
Subsidiaries 2,786,894.68 0.13%
Machinery & Equipment Co., Ltd.
Hangzhou Guoneng Steam Turbine
Subsidiaries 2,574,890.01 0.12%
Engineering Co., Ltd.
Hangzhou Steam Turbine
Affiliate of the Group 929,065.99 0.04%
Engineering Co., Ltd.
Hangzhou Steam Turbine Casting
Subsidiaries 204,098.51 0.01%
Co., Ltd.
Hangzhou Steam Turbine
Affiliate of the Group 316.86 0.00%
Automobile Sales Service Co., Ltd.
Total -- 165,650,285.33 7.48%
87
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
2. Other account receivable.
(1) Other receivable accounts
In RMB
End of term Beginning of term
Categories Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Other receivables with major
individual amount and bad
3,710,320.94 9.05% 3,710,320.94 100.00% 3,710,320.94 11.95% 3,710,320.94 100.00%
debt provision provided
individually
Other receivables provided bad debt provision in groups
Other account receivable
within the consolidation 13,358,622.10 32.58% 7,592,653.87 24.46%
range
Group by age analysis 23,933,674.67 58.37% 2,680,179.90 11.20% 19,742,848.23 63.59% 2,270,192.32 11.50%
Sub-total of group 37,292,296.77 90.95% 2,680,179.90 7.19% 27,335,502.10 88.05% 2,270,192.32 7.31%
Total 41,002,617.71 -- 6,390,500.84 -- 31,045,823.04 -- 5,980,513.26 --
Other receivable accounts with major single amount and bad debt provision drawn upon them
In RMB
Description of other receivables Book balance Amount of bad debt Rate Reason
Customs deposit receivable 3,710,320.94 3,710,320.94 100.00% Hard to recover
Total 3,710,320.94 3,710,320.94 -- --
Other receivable accounts in the portfolio on which bad debt provisions are provided on age basis
In RMB
End of term Beginning of term
Age Book balance Bad debt Book balance Bad debt
Amount Proportion provision Amount Proportion provision
within 1 year
In which: -- -- -- -- -- --
Subtotal of
18,897,869.27 78.96% 944,893.46 15,627,084.83 79.15% 781,354.24
within 1 year
1-2 years 2,442,842.00 10.21% 488,568.40 2,172,800.00 11.01% 434,560.00
2-3 years 1,545,300.00 6.46% 618,120.00 557,499.80 2.82% 222,999.92
Over 3 years 1,047,663.40 4.38% 628,598.04 1,385,463.60 7.02% 831,278.16
3-4 years 191,199.80 0.80% 114,719.88 773,300.00 3.92% 463,980.00
4-5 years 250,300.00 1.05% 150,180.00 59,000.00 0.30% 35,400.00
over 5 yrs 606,163.60 2.53% 363,698.16 553,163.60 2.80% 331,898.16
Total 23,933,674.67 -- 2,680,179.90 19,742,848.23 -- 2,270,192.32
Other receivable accounts in the portfolio on which bad debt provisions were provided on percentage basis
Not applicable
Other receivable accounts in the portfolio on which bad debt provisions were provided on other basis Not
88
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
applicable
Other account receivable with minor amount but bad debt provision provided individually: Not applicable
(2) Other receivable accounts due from shareholders with 5% of shares or over: Not applicable
(3) Nature or description of other receivable accounts with larger amount: Not applicable
(4) Top 5 debtors of other receivable accounts
In RMB
Relation with the Percentage in total of other
Name of the companies Amount Ages
Company receivables
Hangzhou Steam Turbine Casting within 1
Related parties 10,273,686.58 25.06%
Co., Ltd. year
within 1
Hangzhou Custom Non-related 8,333,430.78 20.32%
year
Customs deposit receivable Non-related 3,710,320.94 over 5 yrs 9.05%
Hangzhou Steam Turbine Auxiliary within 1
Related parties 3,080,135.52 7.51%
Machine Co., Ltd. year
Guodian Trust Bidding Co., Ltd. Non-related 2,966,800.00 5 年以内 7.24%
Total -- 28,364,373.82 -- 69.18%
(5) Other receivables due from related parties
In RMB
Relation with the Percentage in total of other
Name of the companies Amount
Company receivables
Hangzhou Steam Turbine Casting Co., Ltd. Subsidiaries 10,273,686.58 25.06%
Hangzhou Steam Turbine Auxiliary Machine
Subsidiaries 3,080,135.52 7.51%
Co., Ltd.
Zhejiang Steam Turbine Packaged Technology
Subsidiaries 4,800.00 0.01%
Development Co., Ltd.
Total -- 13,358,622.10 32.58%
89
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
3. Long-term equity investment
In RMB
Statement on Impairment
Percentage of Voting
Calculating Investment Opening Changed Closing differences between Impairment provision Cash dividend of
Company invested in share in the power in
basis cost balance by balance the shareholding and provision provided this the current term
firm % the firm %
voting rights term
Zhejiang Steam Turbine
Packaged Technology Cost basis 29,800,389.56 29,800,389.56 29,800,389.56 70.86% 70.86% 7,227,210.00
Development Co., Ltd.
Hangzhou Zhongneng
Steam Turbine Power Cost basis 27,644,475.06 27,644,475.06 27,644,475.06 60.83% 60.83% 70,332,375.00
Co., Ltd.
Hangzhou Steam
Turbine Casting Co., Cost basis 11,220,000.00 11,220,000.00 11,220,000.00 51.00% 51.00%
Ltd.
Hangzhou Steam
Turbine Auxiliary Cost basis 46,286,513.41 46,286,513.41 46,286,513.41 87.53% 87.53% 70,024,000.00
Machine Co., Ltd.
Zhejiang Steam Turbine
Machinery & Cost basis 7,968,000.00 7,968,000.00 7,968,000.00 52.00% 52.00% 23,400,000.00
Equipment Co., Ltd.
Greenesol Co. (India) Cost basis 5,534,773.22 5,534,773.22 5,534,773.22 37.00% 37.00%
Bank of Hangzhou Co.,
Cost basis 390,954,040.00 390,954,040.00 390,954,040.00 6.92% 6.92% 23,118,640.00
Ltd.
Zhejiang Turbine
Import & Export Co., Cost basis 20,000,000.00 20,000,000.00 20,000,000.00 100.00% 100.00%
Ltd.
Hangzhou Steam
Turbine Engineering Cost basis 30,000,000.00 30,000,000.00 30,000,000.00 15.00% 15.00%
Co., Ltd.
Hangzhou Changdi
Investment Partnership
Cost basis 20,261,013.65 20,261,013.65 20,261,013.65 2.97% 2.97%
Enterprise (with limited
liabilities)
Hangzhou Steam
Turbine Heavy Industry Cost basis 360,000,000.00 360,000,000.00 360,000,000.00 100.00% 100.00%
Co., Ltd.
Total -- 949,669,204.90 949,669,204.90 949,669,204.90 -- -- -- 194,102,225.00
90
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
4. Operation income and operation cost
(1) Operation incomes
In RMB
Items Occurred current term Occurred in previous term
Major business turnover 1,188,528,375.95 1,492,479,680.88
Other business income 12,949,928.00 14,638,809.99
Total 1,201,478,303.95 1,507,118,490.87
Operation cost 781,172,768.01 1,077,683,194.39
(2) Business segments (on industries)
In RMB
Occurred current term Occurred in previous term
Name of industry
Turnover Operation cost Turnover Operation cost
Boiler and power
1,044,014,019.49 680,322,286.87 1,441,636,489.14 1,040,454,061.91
machine manufacture
Other special equipment 144,514,356.46 90,520,745.59 50,843,191.74 23,300,091.82
Total 1,188,528,375.95 770,843,032.46 1,492,479,680.88 1,063,754,153.73
(3) Business segments (on products)
In RMB
Occurred current term Occurred in previous term
Products or services
Turnover Operation cost Turnover Operation cost
Industrial steam turbine 1,044,014,019.49 680,322,286.87 1,441,636,489.14 1,040,454,061.91
Other special equipment 144,514,356.46 90,520,745.59 50,843,191.74 23,300,091.82
Total 1,188,528,375.95 770,843,032.46 1,492,479,680.88 1,063,754,153.73
(4) Business segments (on regions)
In RMB
Occurred current term Occurred in previous term
Name of districts
Turnover Operation cost Turnover Operation cost
Domestic 1,113,563,894.21 726,978,272.90 1,276,739,350.69 889,403,788.94
Overseas 74,964,481.74 43,864,759.56 215,740,330.19 174,350,364.79
Total 1,188,528,375.95 770,843,032.46 1,492,479,680.88 1,063,754,153.73
(5) Revenue from top five customers
In RMB
Name of clients Total turnover Portion in total turnover
Client I 398,111,709.39 33.14%
Client II 102,375,213.65 8.52%
Client III 70,000,000.02 5.83%
Client IV 41,120,754.72 3.42%
Client V 37,085,470.08 3.09%
Total 648,693,147.86 54.00%
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Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
5. Investment income
(1) Details of investment gains
In RMB
Items Occurred current term Occurred in previous term
Long-term equity investment gains on cost basis 194,102,225.00 170,554,688.00
Others 1,750,584.48 5,943,974.56
Total 195,852,809.48 176,498,662.56
(2) Long-term equity investment gains on cost basis
In RMB
Occurred current Occurred in previous Causation of
Company invested in
term term change
Hangzhou Zhongneng Steam Turbine Power Co.,
70,332,375.00 64,503,750.00
Ltd.
Hangzhou Steam Turbine Auxiliary Machine Co.,
70,024,000.00 48,957,040.00
Ltd.
Zhejiang Steam Turbine Packaged Technology
7,227,210.00 10,575,258.00
Development Co., Ltd.
Hangzhou Steam Turbine Machinery & Equipment
23,400,000.00 23,400,000.00
Co., Ltd.
Bank of Hangzhou Co., Ltd. 23,118,640.00 23,118,640.00
Total 194,102,225.00 170,554,688.00 --
6. Supplementary data of cash flow statement
In RMB
Amount of the Current Amount of the Previous
Supplementary Info.
Term Term
1. Net profit adjusted to cash flow of business operation -- --
Net profit 301,301,877.28 317,806,345.17
Plus: Asset impairment provision 49,149,559.39 16,913,497.95
Fixed asset depreciation, gas and petrol depreciation,
28,282,239.82 31,345,840.90
production goods depreciation
Amortizing of intangible assets 1,348,657.64 1,178,647.72
Loss from disposal of fixed assets, intangible assets, and other
-23,194.80
long-term assets (“-“ for gains)
Financial expenses (“-“ for gains) 8,893,880.04 -871,655.94
Investment loss (“-“ for gains) -195,852,809.48 -176,498,662.56
Decrease of inventory (“-“ for increase) -234,588,906.52 -344,454,821.63
Decrease of operational receivable items (“-“ for increase) 107,551,549.30 -461,124,334.99
Increase of operational payable items (“-“ for decrease) 42,518,032.93 586,073,824.58
Cash flow generated by business operation, net 108,604,080.40 -29,654,513.60
2. Major investment and financing operation not involving with
-- --
cash
3. Net change of cash and cash equivalents -- --
Balance of cash at period end 423,425,045.57 378,882,861.62
Less: Initial balance of cash 295,292,983.14 654,577,030.60
Net increasing of cash and cash equivalents 128,132,062.43 -275,694,168.98
92
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
XVI. Supplementary Information
1. Details of non-recurring gain/loss of the term
In RMB
Rema
Items Amount
rks
Gain/loss from disposal of non-current assets (includes the recovered part of asset
226,573.76
impairment provision already provided)
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 national 4,002,971.00
policy , or in accordance with fixed standards or quantities
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
9,549,596.76
assets, other than valid period value instruments related to the Company’s common
businesses
Other non-business income and expenditures other than the above 4,595,187.79
Less: Influenced amount of income tax 1,996,268.62
Influence on minority shareholders’ equity (after tax) 1,617,302.04
Total 14,760,758.65 --
2. Differences of financial data under domestic and international accounting standards
(1) Differences in net profit and net assets under international and domestic standards
In RMB
Net profit attributable to the shareholders Net asset attributable to the shareholders
of the listed company of the listed company
Current term Amount of last term End of term Beginning of term
On Chinese Accounting
196,174,851.01 232,926,224.38 4,276,885,828.98 4,230,942,110.74
Standard
Items and amounts adjusted on IAS
(2) Differences in net profit and net assets under overseas and domestic standards
In RMB
Net profit attributable to the shareholders Net asset attributable to the shareholders
of the listed company of the listed company
Current term Amount of last term End of term Beginning of term
On Chinese Accounting
196,174,851.01 232,926,224.38 4,276,885,828.98 4,230,942,110.74
Standard
Accounts and amounts adjusted according to overseas accounting standard
(3) Remarks on the differences of financial data under overseas and domestic accounting standards
Not applicable
93
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
3. Net income on asset ratio and earning per share
In RMB Yuan
Earnings per share
Net income on
Profit of the report period Basic earnings Diluted earnings
asset, weighted
per share per share
Net profit attributable to common shareholders of the
4.53% 0.26 0.26
Company
Net profit attributable to the common owners of the PLC
4.19% 0.24 0.24
after deducting of non-recurring gains/losses
4. Irregular situation and causes of items in the financial statements
Balance Sheet Beginning of Scale of
End of term Remarks on the change
Items term change
Mainly recording of land using rights payment under
Intangible assets 308,217,878.79 225,562,108.26 36.64% Heavy Industry Co. – subsidiary of the Company, in
the period
Mainly recording of land using rights payment under
Other non-current
66,500,000.00 -100.00% Heavy Industry Co. – subsidiary of the Company, in
asset
the period
Mainly decrease of bank accepted notes issued by
Notes payable 72,182,776.00 168,751,198.95 -57.23%
subsidiaries in the period
Mainly payment of VAT and income tax payable for
Tax payable 79,556,783.49 107,956,056.99 -26.31% the 4th quarter of previous year and paid in the report
period
Income Statement Same period of Scale of
Current term Remarks on the change
Items last term change
Business tax and Mainly decrease of operational tax due to decrease of
11,426,673.94 17,369,338.95 -34.21%
surcharge turnover
Financial expenses 9,202,486.72 1,542,054.93 496.77% Mainly increase of interest on loans in the period
Mainly change of receivable account age structure:
Asset impairment
55,223,094.46 23,595,101.44 134.04% decrease of short accounts and increase of longer
loss
accounts
Mainly there was an investment gain from disposal of
Investment income 33,668,236.76 64,696,068.76 -47.96% share equity of the Packaged Equipment Co. of the
Group in the 1st half of last year.
Non-operational Mainly influenced by termination of contract and
12,194,329.71 4,202,690.63 190.16%
income penalties in the report period
Mainly decrease of profit contributed by subsidiaries
Minor shareholders’
31,527,233.63 55,854,396.54 -43.55% and decrease of shareholding by minority
equity
shareholders
Cash Flow Same period of Scale of
Current term Remarks on the change
Statement Items last term change
Net cash flow
Mainly decrease of cash received from financial
generated by -58,390,584.46 -274,500,144.16 78.73%
products and investment in the report period
investment
Net increasing of
Mainly significant increase in net cash flow from
cash and cash -111,810,766.61 -369,600,123.01 69.75%
investment operations
equivalents
94
Hangzhou Steam Turbine Co., Ltd. Semiannual Report 2014
Chapter X. Documents for Reference
(I) Financial Statements signed and sealed by the Chairman of the Board , chief accountant and director of
the financial division;
(II) All the originals of the Company’s documents and public notices disclosed in the newspapers
designated by China Securities Regulatory Commission in the report period;
(III) Original copy of Resolutions of the 13th Meeting of the 6th Term of Board.
Hangzhou Steam Turbine Co., Ltd.
Chairman of the Board: Nie Zhonghai
August 18, 2014
95
