The 3rd Quarterly Report 2016(Full Text) Stock code:200771 Stock ID:Hangqilun B Announcement No.2016-72 Hangzhou Steam Turbine Co., Ltd. The 3rd Quarterly Report 2016(Full Text) October 22,2016 1 The 3rd Quarterly Report 2016(Full Text) 1 Important notes The Board of Directors,the Supervisory Committee, the directors, the supervisors, and executives of the Company guarantee that there are no significant omissions, fictitious or misleading statements carried in the Quarterly Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness of the Quarterly Report. All of the directors presented the board meeting at which this Quarterly Report was examined. Mr. Zheng Bin, The Company Leader, Mr. Pu Yangshuo, Chief financial officer and the Mr.Zhao Jiamao, the person in charge of the accounting department (the person in charge of the accounting )hereby confirm the authenticity and completeness of the financial report enclosed in the report. 2 The 3rd Quarterly Report 2016(Full Text) II.Main financial data and changes of shareholders (1)Main accounting data and financial Index Whether it has retroactive adjustment or re-statement on previous accounting data for accounting policy changed and accounting error correction or not. □ Yes √ No As at the end of the Changed (%)over end of prev. As at the end of last year reporting period year Gross assets(RMB) 8,142,499,935.46 7,683,777,005.63 5.97% Net assets attributable to the shareholders of the listed company 4,158,811,119.51 4,219,337,312.80 -1.43% (RMB) Increase/decrease Between beginning of over the same Changed (%)over end Reporting period the year to the end of period of last year of prev. year the report period (%) Operating income(RMB) 874,410,620.01 77.12% 2,241,834,391.89 44.76% Net profit attributable to the shareholders of the listed company -29,088,489.63 63.18% -60,340,727.82 32.41% (RMB) Net profit after deducting of non-recurring gain/loss attributable to -36,516,519.69 58.57% -79,994,834.02 27.48% the shareholders of listed company (RMB) Cash flow generated by business -- -- 361,060,410.70 31.00% operation, net(RMB) Basic earning per share(RMB/Share) -0.039 62.86% -0.080 32.20% Diluted gains per -0.039 62.86% -0.080 32.20% share(RMB/Share)(RMB/Share) Weighted average income/asset ratio -0.70% 1.13% -1.44% 0.60% (%) In RMB Amount (Year-beginning to Items Notes the end of the report period.) Non-current asset disposal gain/loss(including the write-off part -164,270.02 for which assets impairment provision is made) Govemment subsidy recognized in current gain and 2,212,295.21 loss(excluding those closely related to the Company’s business 3 The 3rd Quarterly Report 2016(Full Text) and granted under the state’s policies) Gain/loss from change of fair value of transactional financial asset and liabilities, and investment gains from disposal of transactional financial assets and liabilities and sellable financial 18,351,277.25 assets other than valid period value instruments related to the Company’s common businesses Other non-business income and expenditures other than the above 6,824,593.39 Less:Amount of influence of income tax 4,962,444.69 Influence on minority shareholders’ equity (after tax) 2,607,344.94 Total 19,654,106.20 -- 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. (II) Total Shareholders and Shares Held by Top Ten Shareholders at the End of the Reporting Period 1. About Total Common Shareholders, Total Preference Shareholders with the Voting Power Recovered and the Shares Held by Top Ten Common Shareholders In shares Total preference shareholders Total number of common shareholders at the with the voting power 15,565 0 period-end recovered at the end of the reporting period(if any) Shares held by the top 10 shareholders Amount of Pledging or Share tradable shares freezing Properties of Shareholder name proportion Quantity with Status shareholder % Conditional of the Quantity held shares State-owned Hangzhou Steam Turbine Power Group Co., Ltd. 63.64% 479,824,800 479,824,800 legal person Foreign Legal Shenwan Hongyuan Securities(H.K)Co., Ltd. 0.70% 5,243,266 0 person Foreign Legal GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED 0.60% 4,488,965 0 person Foreign Legal NORGES BANK 0.57% 4,303,675 0 person VANGUARD TOTAL INTERNATIONAL STOCK INDEX Foreign Legal 0.44% 3,308,246 0 FUND person CHINA INT'L CAPITAL CORP HONG KONG SECURITIES Foreign Legal 0.33% 2,472,960 0 LTD person Foreign Legal AUSTRALIANSUPER PTY LTD 0.28% 2,108,321 0 person Domestic Xia Zulin 0.28% 2,100,000 0 natural person 4 The 3rd Quarterly Report 2016(Full Text) shares Foreign Legal CREDIT SUISSE (HONG KONG) LIMITED 0.27% 2,033,703 0 person State-owned China Merchants Securities(HK)Co., Ltd. 0.27% 2,028,803 0 legal person Shares held by the Top 10 Shareholders of Non-restricted shares Number of the non-restricted Share type Shareholders’ Names shares held Share type Quantity Foreign shares Shenwan Hongyuan Securities(H.K)Co., Ltd. 5,243,266 placed in domestic 5,243,266 exchange Foreign shares GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED 4,488,965 placed in domestic 4,488,965 exchange Foreign shares NORGES BANK 4,303,675 placed in domestic 4,303,675 exchange Foreign shares VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND 3,308,246 placed in domestic 3,308,246 exchange Foreign shares CHINA INT'L CAPITAL CORP HONG KONG SECURITIES LTD 2,472,960 placed in domestic 2,472,960 exchange Foreign shares AUSTRALIANSUPER PTY LTD 2,108,321 placed in domestic 2,108,321 exchange Foreign shares Xia Zulin 2,100,000 placed in domestic 2,100,000 exchange Foreign shares CREDIT SUISSE (HONG KONG) LIMITED 2,033,703 placed in domestic 2,033,703 exchange Foreign shares China Merchants Securities(HK)Co., Ltd. 2,028,803 placed in domestic 2,028,803 exchange 5 The 3rd Quarterly Report 2016(Full Text) Foreign shares BBH A/C VANGUARD EMERGING MARKETS STOCK INDEX FUND 1,991,804 placed in domestic 1,991,804 exchange (1) It is unknown whether there is any relationship among the 10 unrestricted current-share holders. (2) None of Explanation on associated relationship among the aforesaid shareholders other shareholders is acting-in-concert as described by Administration Rules of Information Disclosure on Change of Shareholding Position. The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company have no buy –back agreement dealing in reporting period. 2.Total number of preferred shareholders and shareholding of top 10 preferred shareholders by the end of the report period Not applicable III. Significant Events I. Changes in the principal accounting statement items and financial indications and the causes Balance sheet items Ending balance in Opening balance in Proportion Causes of change CNY CNY of the change Mainly due to the completion of the Inventories 2,180,113,756.81 1,826,869,838.60 19.34% current sales unit does not increase Mainly due to current purchase of Other current assets 811,969,171.51 427,203,835.44 90.07% financial products increased Mainly due to the increase of the Construction in process 189,578,333.18 119,187,107.52 59.06% project cost of the scientific research building of the headquarters Mainly due to department of large Account payable 1,102,944,892.35 810,420,381.45 36.10% accessories to pay increased Mainly due to the Ministry received an Deferred income 13,620,580.13 6,804,425.00 100.17% increase in financial assistance for the current period Income statement items End of term Same period of last Scale of Remarks on the change term change Operation income Mainly due to current sales situation 2,241,834,391.89 1,548,669,193.12 44.76% improved, sales units increased Operation cost Mainly due to operating income 1,487,970,320.21 998,351,747.61 49.04% increased year on year, the corresponding increase in operating 6 The 3rd Quarterly Report 2016(Full Text) costs Mainly due to companies to maintain Sale expenses 112,598,400.85 103,927,345.93 8.34% the market and maintain a stable sales efforts Administrative expense Mainly caused by the increase in the 528,961,508.88 478,507,184.84 10.54% Company’s research and development expenditure year on year Asset impairment loss Mainly due to exchange gains arising 2,220,979.34 3,734,964.80 -40.54% from a stronger US dollar Mainly due to decrease in profit for the period The corresponding decrease in Income expenses 337,824.85 11,535,844.37 -97.07% income tax expense and increase in deferred income tax expenses arising from impairment Cash flow statement Items Amount in the Same period of the Proportion n Causes of change reporting period previous year , CNY f the change Cash flow generated by business Mainly due to the proportion of cash operation, net 361,060,410.70 275,609,830.02 31.00% receipts in the sales of goods in the current period increased year on year Net cash flow generated by investment Mainly caused by the increase in the -460,559,408.37 -123,207,589.47 -273.81% net amount of financial product expense at the current period Net cash flow generated by Financing Mainly due to last year the company -60,243,944.69 -129,049,862.51 53.32% issued a dividend, not released this year Mainly caused by the increase in the Net increasing of cash and cash -155,001,766.35 26,366,068.26 -687.88% net amount of financial product equivalents expense at the current period II. Progress of Significant Events, their Influences and Analytical Notice on the Solutions Not applicable III. Commitments finished in implementation by the Company, shareholders, actual controller, acquirer, directors, supervisors, senior executives or other related parties in the reporting period and commitments unfinished in implementation at the end of the reporting period Non-existence IV.Prediction of Business performance for 2016. Not applicable 7 The 3rd Quarterly Report 2016(Full Text) V. Investment in securities Non-existence VI. Investment in derivatives Non-existence VII. Registration form of such Activities as Reception, Research, Communication, Interview in the Reporting Period Not applicable VIII. Outward Guarantee against the Regulations Not applicable IX. Non-operational Occupancy of the Company’s Capital by the Controlling Shareholder and its Related Parties Non-existence IV. Financial Statement I. Financial statement 1. Consolidated balance sheet Prepared by::Hangzhou Steam Turbine Co., Ltd. September 30, 2016 In RMB Items At the end of term Beginning of term Current asset: Monetary fund 623,002,512.36 751,596,796.24 Settlement provision Outgoing call loan Financial assets measured at fair value with variations accounted into current income account Derivative financial assets Bill receivable 483,213,019.85 680,518,943.49 Account receivable 1,878,043,244.04 2,096,090,157.61 Prepayments 314,582,452.37 139,267,324.65 Insurance receivable Reinsurance receivable Provisions of Reinsurance contracts receivable Interest receivable 8 The 3rd Quarterly Report 2016(Full Text) Dividend receivable Other account receivable 33,968,910.09 25,574,057.29 Repurchasing of financial assets Inventories 2,180,113,756.81 1,826,869,838.60 Assets held for sales Non-current asset due in 1 year Other current asset 811,969,171.51 427,203,835.44 Total of current assets 6,324,893,067.03 5,947,120,953.32 Non-current assets: Loans and payment on other’s behalf disbursed Disposable financial asset 548,852,528.53 509,409,741.77 Expired investment in possess Long-term receivable Long term share equity investment Property investment Fixed assets 598,920,412.50 642,155,636.34 Construction in progress 189,578,333.18 119,187,107.52 Engineering material Fixed asset disposal Production physical assets Gas & petrol Intangible assets 299,148,619.58 304,949,207.18 R & D petrol Goodwill Long-germ expenses to be amortized 1,761,646.23 2,029,471.80 Deferred income tax asset 179,345,328.41 158,924,887.70 Other non-current asset Total of non-current assets 1,817,606,868.43 1,736,656,052.31 Total of assets 8,142,499,935.46 7,683,777,005.63 Current liabilities Short-term loans 73,000,000.00 85,350,000.00 Loan from Central Bank Deposit received and hold for others Call loan received 9 The 3rd Quarterly Report 2016(Full Text) Financial liabilities measured at fair value with variations accounted into current income account Derivative financial liabilities Bill payable 221,107,239.52 194,226,049.73 Account payable 1,102,944,892.35 810,420,381.45 Advance payment 1,967,220,814.77 1,736,820,949.19 Selling of repurchased financial assets Fees and commissions receivable Employees’ wage payable 74,837,906.27 70,257,474.46 Tax payable 34,241,271.31 36,008,109.09 Interest payable Dividend payable Other account payable 29,540,161.37 29,705,125.51 Reinsurance fee payable Insurance contract provision Entrusted trading of securities Entrusted selling of securities Liabilities held for sales Non-current liability due in 1 year 100,000.00 300,000.00 Other current liability Total of current liability 3,502,992,285.59 2,963,088,089.43 Non-current liabilities: Long-term loan 123,400,000.00 123,400,000.00 Bond payable Including:preferred stock Sustainable debt Long-term payable 330,000.00 330,000.00 Long-term payable employees’s remuneration Special payable Expected liabilities Deferred income 13,620,580.13 6,804,425.00 Deferred income tax liability 1,017,473.05 1,017,473.05 Other non-current liabilities 212,878.00 Total non-current liabilities 138,580,931.18 131,551,898.05 Total of liability 3,641,573,216.77 3,094,639,987.48 10 The 3rd Quarterly Report 2016(Full Text) Owners’ equity Share capital 754,010,400.00 754,010,400.00 Other equity instrument Including:preferred stock Sustainable debt Capital reserves 139,590,345.09 139,590,345.09 Less:Shares in stock Other comprehensive income -469,564.94 -852,752.00 Special reserves 31,196,267.98 31,764,920.51 Surplus reserves 621,112,807.78 621,112,807.78 Common risk provision Undistributed profit 2,613,370,863.60 2,673,711,591.42 Total of owner’s equity belong to the parent company 4,158,811,119.51 4,219,337,312.80 Minority shareholders’ equity 342,115,599.18 369,799,705.35 Total of owners’ equity 4,500,926,718.69 4,589,137,018.15 Total of liabilities and owners’ equity 8,142,499,935.46 7,683,777,005.63 Legal Representative: Zheng Bin Person in charge of accounting:Pu Yangshuo Accounting Dept Leader: Zhao Jiamao 2.Parent Company Balance Sheet In RMB Items At the end of term Beginning of term Current asset: Monetary fund 265,657,955.72 387,916,202.79 Financial assets measured at fair value with variations accounted into current income account Derivative financial assets Bill receivable 237,903,792.45 365,504,827.88 Account receivable 1,435,196,594.64 1,637,391,672.98 Prepayments 214,509,246.87 53,440,645.95 Interest receivable Dividend receivable Other account receivable 7,807,360.89 12,245,371.97 Inventories 1,740,123,644.36 1,454,420,457.64 11 The 3rd Quarterly Report 2016(Full Text) Assets held for sales Non-current asset due in 1 year Other current asset 560,028,681.62 170,653,680.58 Total of current assets 4,461,227,276.55 4,081,572,859.79 Non-current assets: Disposable financial asset 505,047,165.02 465,604,378.26 Expired investment in possess Long-term receivable Long term share equity investment 502,919,378.03 502,919,378.03 Property investment Fixed assets 295,219,059.53 334,677,256.20 Construction in progress 100,622,140.47 79,982,551.34 Engineering material Fixed asset disposal Production physical assets Gas & petrol Intangible assets 174,837,786.80 177,872,266.49 R & D petrol Goodwill Long-germ expenses to be amortized 761,660.66 761,660.66 Deferred income tax asset 141,305,913.18 120,771,991.85 Other non-current asset Total of non-current assets 1,720,713,103.69 1,682,589,482.83 Total of assets 6,181,940,380.24 5,764,162,342.62 Current liabilities Short-term loans Financial liabilities measured at fair value with variations accounted into current income account Derivative financial liabilities Bill payable 13,500,000.00 Account payable 744,416,147.83 436,004,535.90 Advance payment 1,586,323,472.73 1,428,724,224.76 Employees’ wage payable 32,625,585.87 51,373,858.57 Tax payable 12,250,139.72 3,538,126.39 12 The 3rd Quarterly Report 2016(Full Text) Interest payable Dividend payable Other account payable 19,356,254.27 20,338,742.44 Classified as held for sale debt Non-current liability due in 1 year Other current liability Total of current liability 2,394,971,600.42 1,953,479,488.06 Non-current liabilities: Long-term loan 100,000,000.00 100,000,000.00 Bond payable Including:preferred stock Sustainable debt Long-term payable Long-term payable to employees Special payable Expected liabilities Deferred income 6,838,405.13 22,250.00 Deferred income tax liability 1,017,473.05 1,017,473.05 Other non-current liabilities Total of Non-current liabilities 107,855,878.18 101,039,723.05 Total of liability 2,502,827,478.60 2,054,519,211.11 Owners’ equity Share capital 754,010,400.00 754,010,400.00 Other equity instrument Including:preferred stock Sustainable debt Capital reserves 138,953,250.09 138,953,250.09 Less:Shares in stock Other comprehensive income Special reserves 13,098,989.67 13,098,989.67 Surplus reserves 602,356,402.65 602,356,402.65 Undistributed profit 2,170,693,859.23 2,201,224,089.10 Total of owners’ equity 3,679,112,901.64 3,709,643,131.51 Total of liabilities and owners’ equity 6,181,940,380.24 5,764,162,342.62 13 The 3rd Quarterly Report 2016(Full Text) 3.Consolidated Income statement of the Report period In RMB Items Amount in this period Amount in last period I. Income from the key business 874,410,620.01 493,672,866.88 Incl:Business income 874,410,620.01 493,672,866.88 Interest income Insurance fee earned Fee and commission received II. Total business cost 898,062,001.19 580,669,969.95 Incl:Business cost 637,032,414.17 335,842,400.43 Interest expense Fee and commission paid Insurance discharge payment Net claim amount paid Insurance policy dividend paid Insurance policy dividend paid Reinsurance expenses Business tax and surcharge 8,329,543.14 2,224,854.69 Sales expense 36,730,806.87 35,992,771.84 Administrative expense 173,854,590.33 163,337,321.94 Financial expenses 1,708,950.17 -1,197,475.54 Asset impairment loss 40,405,696.51 44,470,096.59 Add:Gains from change of fir value (“-”for loss) Investment gain(“-”for loss) 6,893,602.33 3,226,553.62 Incl: investment gains from affiliates Gains from currency exchange(“-”for loss) III. Operational profit(“-”for loss -16,757,778.85 -83,770,549.45 Add:Non-business income 3,051,550.49 10,459,046.84 Incl:Gains from disposal of non-current assets 100.00 -29,583.00 Less:Non business expenses 1,480,307.99 1,039,638.56 14 The 3rd Quarterly Report 2016(Full Text) Incl:Loss from disposal of non-current assets 470.20 -303,677.88 IV.Total profit(“-”for loss) -15,186,536.35 -74,351,141.17 Less:Income tax expenses 3,171,756.19 245,388.17 V. Net profit(“-”for net loss -18,358,292.54 -74,596,529.34 Net profit attributable to the owners of parent company -29,088,489.63 -78,993,858.42 Minority shareholders’ equity 10,730,197.09 4,397,329.08 VI. Net after-tax of Other comprehensive income 18,461.17 -741,835.57 Net after-tax of other comprehensive income attributable to owners of the 7,860.70 -315,870.62 parent company. (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit plans of changes in net debt or net assets 2.Other comprehensive income under the equity method inve stee can not be reclassified into profit or loss. (II) Other comprehensive income that will be reclassified into pr 7,860.70 -315,870.62 ofit or loss. 1.Other comprehensive income under the equity method inve stee can be reclassified into profit or loss. 2.Gains and losses from changes in fair value available for sa le financial assets 3.Held-to-maturity investments reclassified to gains and loss es of available for sale financial assets 4.The effective portion of cash flow hedges and losses 5.Translation differences in currency financial statements 7,860.70 -315,870.62 6.Other Net after-tax of other comprehensive income attributable to Mino 10,600.47 -425,964.95 rity shareholders’ equity VII. Total comprehensive income -18,339,831.37 -75,338,364.91 Total comprehensive income attributable to the owner of the -29,080,628.93 -79,309,729.04 parent company 15 The 3rd Quarterly Report 2016(Full Text) Total comprehensive income attributable minority 10,740,797.56 3,971,364.13 shareholders VIII. Earnings per share (I)Basic earnings per share -0.039 -0.105 (II)Diluted earnings per share -0.039 -0.105 The current business combination under common control, the net profits of the combined party before achieved net profit of RMB 0.00, last period the combined party realized RMB0.00. Legal Representative:Zheng Bin Person in charge of accounting:Pu Yangshuo Accounting Dept Leader: Zhao Jiamao 4.Income statement of the Parent Company of the Report period In RMB Items Amount in this period Amount in last period I. Income from the key business 562,290,961.03 267,659,008.23 Less:Business cost 469,793,908.17 208,002,999.52 Business tax and surcharge 5,993,416.83 0.00 Sales expense 21,188,962.01 25,074,884.70 Administrative expense 105,829,118.79 104,296,835.88 Financial expenses 166,594.21 -1,927,945.06 Asset impairment loss 40,004,378.53 29,974,171.98 Add:Gains from change of fir value (“-”for loss) 0.00 Investment gain(“-”for loss) 15,582,740.93 1,249,986.09 Incl: investment gains from affiliates II. Operational profit(“-”for loss) -65,102,676.58 -96,511,952.70 Add :Non-operational income 1,622,587.10 4,196,931.14 Including:Income from disposal of non-current assets Less:Non business expenses 714,604.52 472,554.73 Incl:Loss from disposal of non-current assets III.Total profit(“-”for loss) -64,194,694.00 -92,787,576.29 Less:Income tax expenses -11,099,901.06 -4,496,125.80 IV. Net profit(“-”for net loss) -53,094,792.94 -88,291,450.49 V.Net of profit of other comprehensive income (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 16 The 3rd Quarterly Report 2016(Full Text) 1.Re-measurement of defined benefit plans of changes in net debt or net assets 2.Other comprehensive income under the equity method investee can not be reclassified into profit or loss. ( II ) Other comprehensive income that will be reclassified into profit or l oss. 1.Other comprehensive income under the equity method investee can be reclassified into profit or loss. 2.Gains and losses from changes in fair value available for sale finan cial assets 3.Held-to-maturity investments reclassified to gains and losses of av ailable for sale financial assets 4.The effective portion of cash flow hedges and losses 5.Translation differences in currency financial statements 6.Other VI. Total comprehensive income -53,094,792.94 -88,291,450.49 VII. Earnings per share: (I)Basic earnings per share -0.070 -0.117 (II)Diluted earnings per share -0.070 -0.117 5. Consolidated Income statement between the beginning of the year and end of the report period In RMB Items Amount in this period Amount in last period I. Total operating income 2,241,834,391.89 1,548,669,193.12 Including:Operating income 2,241,834,391.89 1,548,669,193.12 Interest income Insurance gained Commission charge and commission income II. Total operating cost 2,314,529,335.97 1,660,201,348.38 Including:Operating cost 1,487,970,320.21 998,351,747.61 Interest expense Commission chare and commission expense Insurance discharge payment 17 The 3rd Quarterly Report 2016(Full Text) Net claim amount paid Insurance policy dividend paid Insurance policy dividend paid Reinsurance expenses Business tax and surcharge 16,752,794.01 8,559,448.11 Sales expense 112,598,400.85 103,927,345.93 Administrative expense 528,961,508.88 478,507,184.84 Financial expenses 2,220,979.34 3,734,964.80 Asset impairment loss 166,025,332.68 67,120,657.09 Add:Gains from change of fir value (“-”for loss) Investment gain(“-”for loss) 21,938,936.95 42,458,015.67 Incl: investment gains from affiliates Gains from currency exchange(“-”for loss) III. Operational profit(“-”for loss -50,756,007.13 -69,074,139.59 Add:Non-business income 9,896,312.51 16,744,253.39 Incl:Gains from disposal of non-current assets Less:Non business expenses 3,438,002.64 3,196,801.45 Incl:Loss from disposal of non-current assets IV.Total profit(“-”for loss) -44,297,697.26 -55,526,687.65 Less:Income tax expenses 337,824.85 11,535,844.37 V. Net profit(“-”for net loss -44,635,522.11 -67,062,532.02 Net profit attributable to the owners of parent company -60,340,727.82 -89,276,191.74 Minority shareholders’ equity 15,705,205.71 22,213,659.72 VI. Net after-tax of Other comprehensive income 899,931.08 -1,114,979.45 Net after-tax of other comprehensive income attributable to owners of the parent c 383,187.06 -474,753.79 ompany. (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit plans of changes in net debt or net assets 2.Other comprehensive income under the equity method investee can 18 The 3rd Quarterly Report 2016(Full Text) not be reclassified into profit or loss. (II) Other comprehensive income that will be reclassified into profit or l 383,187.06 -474,753.79 oss. 1.Other comprehensive income under the equity method investee can be reclassified into profit or loss. 2.Gains and losses from changes in fair value available for sale finan cial assets 3.Held-to-maturity investments reclassified to gains and losses of av ailable for sale financial assets 4.The effective portion of cash flow hedges and losses 5.Translation differences in currency financial statements 383,187.06 -474,753.79 6.Other Net after-tax of other comprehensive income attributable to Minority 516,744.02 -640,225.66 shareholders’ equity VII. Total comprehensive income -43,735,591.03 -68,177,511.47 Total comprehensive income attributable to the owner of the parent -59,957,540.76 -89,750,945.53 company Total comprehensive income attributable minority shareholders 16,221,949.73 21,573,434.06 VIII. Earnings per share (I)Basic earnings per share -0.080 -0.118 (II)Diluted earnings per share -0.080 -0.118 The current business combination under common control, the net profits of the combined party before achieved net profit of RMB 0.00, last period the combined party realized RMB0.00. 6.Profit Statement of the Parent Between the Beginning of the Year and End of the Report Period In RMB Items Amount in this period Amount in last period I. Business income 1,435,991,350.39 888,233,056.51 Less:Business cost 1,015,911,250.13 633,240,390.71 Business tax and surcharge 10,794,084.24 1,398,211.91 Sales expense 69,052,768.19 70,652,269.86 Administrative expense 335,119,956.57 308,110,674.99 Financial expenses -1,276,257.31 2,903,060.49 Asset impairment loss 152,020,358.27 55,164,345.10 19 The 3rd Quarterly Report 2016(Full Text) Add:Gains from change of fir value (“-”for loss) Investment gain(“-”for loss) 94,396,560.64 148,139,180.05 Incl: investment gains from affiliates II. Operational profit -51,234,249.06 -35,096,716.50 Add:Non-business income 1,640,400.14 7,082,545.09 Incl:Gains from disposal of non-current assets Less:Non business expenses 1,470,302.28 1,177,214.68 Incl:Loss from disposal of non-current assets III.Total profit -51,064,151.20 -29,191,386.09 Less:Income tax expenses -20,533,921.33 -8,144,808.63 IV. Net profit -30,530,229.87 -21,046,577.46 V. Net after-tax of Other comprehensive income Net after –tax of profit of other comprehensive income attributable to owners of th e parent company. (I)Other comprehensive income items that will not be reclassified into gains/losses in the subsequent accounting period 1.Re-measurement of defined benefit plans of changes in net debt or net assets 2.Other comprehensive income under the equity method investee can not be reclassified into profit or loss. (II) Other comprehensive income that will be reclassified into profit or l oss. 1.Other comprehensive income under the equity method investee can be reclassified into profit or loss. 2.Gains and losses from changes in fair value available for sale finan cial assets 3.Held-to-maturity investments reclassified to gains and losses of av ailable for sale financial assets 4.The effective portion of cash flow hedges and losses 5.Translation differences in currency financial statements 6.Other -30,530,229.87 -21,046,577.46 V. Earnings per share (I)Basic earnings per share -0.040 -0.028 (II)Diluted earnings per share -0.040 -0.028 20 The 3rd Quarterly Report 2016(Full Text) 7. Consolidated Cash Flow Statement Between the Beginning of the Year and End of the Report Period In RMB Items Amount in this period Amount in last period I.Cash flows from operating activities Cash received from sales of goods or rending of 2,205,347,661.82 1,863,008,900.61 services Net increase of customer deposits and capital kept for brother company Net increase of loans from central bank Net increase of inter-bank loans from other financial bodies Cash received against original insurance contract Net cash received from reinsurance business Net increase of client deposit and investment Net increase of the financial assets that are measured at fair value and whose movement is counted to the current gain and loss Cash received as interest, processing fee and commission Net increase of inter-bank fund received Net increase of repurchasing business Tax returned 6,238,100.28 3,923,733.08 Other cash received from business operation 20,878,728.24 39,495,626.45 Sub-total of cash inflow 2,232,464,490.34 1,906,428,260.14 Cash paid for purchasing of merchandise and services 1,092,177,371.39 802,483,049.81 Net increase of client trade and advance Net increase of savings n central bank and brother company Cash paid for original contract claim Cash paid for interest, processing fee and commission Cash paid for policy dividend Cash paid to staffs or paid for staffs 503,817,181.35 515,899,321.06 Taxes paid 144,485,145.93 207,976,861.79 21 The 3rd Quarterly Report 2016(Full Text) Other cash paid for business activities 130,924,380.97 104,459,197.46 Sub-total of cash outflow from business activities 1,871,404,079.64 1,630,818,430.12 Cash flow generated by business operation, net 361,060,410.70 275,609,830.02 II.Cash flow generated by investing Cash received from investment retrieving Cash received as investment gains 21,938,936.95 42,458,402.03 Net cash retrieved from disposal of fixed assets, 17,000.00 149,120.20 intangible assets, and other long-term assets Net cash received from disposal of subsidiaries or other operational units Other investment-related cash received 988,800,000.00 1,189,105,999.95 Sub-total of cash inflow due to investment activities 1,010,755,936.95 1,231,713,522.18 Cash paid for construction of fixed assets, intangible 63,172,558.56 44,795,233.90 assets and other long-term assets Cash paid as investment 39,442,786.76 10,419,276.30 Net increase of loan against pledge Net cash received from subsidiaries and other operational units Other cash paid for investment activities 1,368,700,000.00 1,299,706,601.45 Sub-total of cash outflow due to investment activities 1,471,315,345.32 1,354,921,111.65 Net cash flow generated by investment -460,559,408.37 -123,207,589.47 III.Cash flow generated by financing Cash received as investment 706,350.00 11,740,000.00 Incl: Cash received as investment from minor shareholders Cash received as loans 121,402,502.11 90,400,000.00 Cash received from bond placing Other financing –related ash received Sub-total of cash inflow from financing activities 122,108,852.11 102,140,000.00 Cash to repay debts 134,036,536.05 90,600,000.00 Cash paid as dividend, profit, or interests 48,316,260.75 140,589,862.51 Incl: Dividend and profit paid by subsidiaries to minor shareholders Other cash paid for financing activities 22 The 3rd Quarterly Report 2016(Full Text) Sub-total of cash outflow due to financing activities 182,352,796.80 231,189,862.51 Net cash flow generated by financing -60,243,944.69 -129,049,862.51 IV. Influence of exchange rate alternation on cash and 4,741,176.01 3,013,690.22 cash equivalents V.Net increase of cash and cash equivalents -155,001,766.35 26,366,068.26 Add: balance of cash and cash equivalents at the 751,596,796.24 613,958,063.91 beginning of term VI ..Balance of cash and cash equivalents at the end 596,595,029.89 640,324,132.17 of term 8. Cash Flow Statement of the Parent Between the Beginning of the Year and End of the Report Period In RMB Items Amount in this period Amount in last period I.Cash flows from operating activities Cash received from sales of goods or 1,323,738,157.07 1,222,686,383.60 rending of services Tax returned 359,071.25 2,122,030.27 Other cash received from business 10,169,189.04 1,643,931.08 operation Sub-total of cash inflow 1,334,266,417.36 1,226,452,344.95 Cash paid for purchasing of 633,403,646.46 598,048,343.03 merchandise and services Cash paid to staffs or paid for staffs 350,255,025.51 352,513,290.86 Taxes paid 49,736,744.31 96,364,022.69 Other cash paid for business activities 41,745,681.57 21,553,427.07 Sub-total of cash outflow from business 1,075,141,097.85 1,068,479,083.65 activities Cash flow generated by business 259,125,319.51 157,973,261.30 operation, net II.Cash flow generated by investing Cash received from investment retrieving Cash received as investment gains 94,396,560.64 148,139,577.52 Net cash retrieved from disposal of fixed assets, intangible assets, and other 16,900.00 1,926.00 long-term assets 23 The 3rd Quarterly Report 2016(Full Text) Net cash received from disposal of subsidiaries or other operational units Other investment-related cash received 430,000,000.00 200,000,000.00 Sub-total of cash inflow due to 524,413,460.64 348,141,503.52 investment activities Cash paid for construction of fixed assets, intangible assets 46,790,472.41 25,625,615.45 and other long-term assets Cash paid as investment 39,442,786.76 11,593,912.79 Net cash received from subsidiaries and other operational units Other cash paid for investment 820,000,000.00 360,000,601.50 activities Sub-total of cash outflow due to 906,233,259.17 397,220,129.74 investment activities Net cash flow generated by investment -381,819,798.53 -49,078,626.22 III.Cash flow generated by financing Cash received as investment Cash received as loans 19,402,502.11 Cash received from bond placing Other financing –related ash received Sub-total of cash inflow from 19,402,502.11 financing activities Cash to repay debts 19,486,536.05 Cash paid as dividend, profit, or 2,610,507.34 78,902,151.12 interests Other cash paid for financing activities Sub-total of cash outflow due to 22,097,043.39 78,902,151.12 financing activities Net cash flow generated by financing -2,694,541.28 -78,902,151.12 IV. Influence of exchange rate 3,130,773.23 2,411,623.05 alternation on cash and cash equivalents V.Net increase of cash and cash -122,258,247.07 32,404,107.01 equivalents Add: balance of cash and cash 387,916,202.79 248,509,410.84 equivalents at the beginning of term VI ..Balance of cash and cash 265,657,955.72 280,913,517.85 24 The 3rd Quarterly Report 2016(Full Text) equivalents at the end of term II. Auditor‘s report The Q3 Report is not audited. Hangzhou Steam Turbine Co., Ltd. Chairman of the Board: Zheng Bin October 22, 2016 25