Agile Group Holdings Limited

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your Shares, you should at once hand this circular to the purchaser(s) or the transferee(s) or to the bank, licensed securities dealer, registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 3383)

(1) MAJOR AND CONNECTED TRANSACTION THE PROPOSED REPURCHASE OF

30% EQUITY INTEREST IN CROWN GOLDEN; AND

(2) NOTICE OF EGM

A letter from the Board is set out on pages 5 to 15 of this circular.

A notice convening the EGM to be held at Harcourt Room, Lower Lobby Level, Conrad Hong Kong, Pacific Place, 88 Queensway, Hong Kong on Monday, 17 July 2017 at 2: 30 p.m. is set out on pages EGM-1 to EGM-2 to this circular. Whether or not you are able to attend the meeting, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong as soon as possible and in any event not less than 48 hours before the time of the meeting. Completion and return of the form of proxy will not preclude you from attending and voting at the meeting or any adjournment thereof should you so wish.

26 June 2017

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Appendix I — Financial Information of the Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	I-1
Appendix II — Unaudited Pro Forma Financial Information of the Group . . . . . .	II-1
Appendix III — Valuation Report on the Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	III-1
Appendix IV — Accountant’s Report of Crown Golden Group . . . . . . . . . . . . . . . . . . .	IV-1
Appendix V — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	V-1
Notice of the EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

– i –

DEFINITIONS

In this circular, the following terms and expressions shall have the following respective meanings unless the context otherwise requires:

‘‘associate(s)’’ shall have the meaning as ascribed to it under the Listing Rules;
‘‘Board’’ the board of Directors of the Company;
‘‘Business Day(s)’’ a day (excluding Saturday and other general holidays in Hong Kong and any day on which a tropical cyclone warning no. 8 or above or a ‘‘black’’ rainstorm warning is hoisted at any time between 9: 00 a.m. and 5: 00 p.m.) on which licensed banks in Hong Kong are generally open for business;
‘‘BVI’’ the British Virgin Islands;
‘‘Company’’ Agile Group Holdings Limited, an exempted company incorporated in the Cayman Islands with limited liability on 14 July 2005, which Shares are listed on the Main Board of the Stock Exchange;
‘‘Completion’’ completion of the Repurchase in accordance with the SPA;
‘‘connected person(s)’’ has the meaning ascribed to it under the Listing Rules;
‘‘Consideration’’ total consideration for the Repurchase under the SPA, being US$900,000,000;
‘‘Controlling Top Coast Investment Limited, a limited liability company Shareholder’’ incorporated under the laws of the BVI, holding 62.63% of the issued share capital of the Company as at Latest Practicable Date;
‘‘controlling has the meaning ascribed to it under the Listing Rules; shareholder(s)’’
‘‘Crown Golden’’ Crown Golden Investments Limited (冠金投資有限公司), a company incorporated in the BVI with limited liability on 15 February 2007, its equity interests is being held by Forever Fame and the Target Company as to 70% and 30% respectively, and an indirect non-wholly owned subsidiary of the Company;
‘‘Crown Golden Group’’
Crown Golden and its subsidiaries;
‘‘Deposit’’ the amount of US$35,000,000;
‘‘Director(s)’’ the director(s) of the Company;

– 1 –

DEFINITIONS

‘‘EGM’’ the extraordinary general meeting of the Company to be convened for the purpose of considering, if thought fit, approving, among other things, the Repurchase;
‘‘Encumbrance(s)’’ a mortgage, charge (whether fixed or floating), debenture, pledge, lien, option, restriction, right of first refusal, right of pre-emption, third-party right or interest, other encumbrance or security interest of any kind, or another type of preferential arrangement (including, without limitation, retention arrangement) having similar effect;
‘‘Forever Fame’’ Forever Fame Property Development Holdings Limited (譽永房地產發展控股有限公司), a company incorporated in the BVI with limited liability and an indirect wholly-owned subsidiary of the Company;
‘‘Group’’ the Company and its subsidiaries;
‘‘HK$’’ Hong Kong dollar(s), the lawful currency of Hong Kong;
‘‘Hong Kong’’ the Hong Kong Special Administrative Region of the PRC;
‘‘Independent Third third party(ies) not connected with the Company and its Party(ies)’’ subsidiaries, their respective directors, chief executives and substantial shareholders and any of their associates;
‘‘Latest Practicable 23 June 2017, being the latest practicable date prior to the Date’’ printing of this circular for ascertaining certain information contained in this circular;
‘‘Listing Rules’’ the Rules Governing the Listing of Securities on the Stock Exchange, as amended, supplemented or modified from time to time;
‘‘Long Stop Date’’ means the 90th day after the date of the SPA or such other date as the Target Company and Crown Golden may agree, provided that the Target Company shall agree to extend the Long Stop Date by seven days if the Condition is not satisfied by the original Long Stop Date due to delays caused by the Stock Exchange and which are not attributable to the Company or the Controlling Shareholder;
‘‘percentage ratios’’ has the same meaning ascribed to it under the Listing Rules;
‘‘PRC’’
The People’s Republic of China and for the purpose of this circular, excluding Taiwan, Hong Kong and the Macau Special Administrative Region of the PRC;

– 2 –

DEFINITIONS

‘‘Property’’

The resort town located at Qingshuiwan, Lingshui Li Minority Autonomous County, Hainan, the PRC developed by Crown Golden Group;
‘‘Purchase Notice’’ the notice dated 19 April 2017 from Forever Fame to the Target Company pursuant to the Shareholders’ Agreement, notifying its intention to exercise the right under the Shareholders’ Agreement for the possible acquisition of 100% interests in the Target Company for US$900,000,000 on terms and conditions no less favorable to those set out in the Transfer Notice;

‘‘Repurchase’’ the repurchase of the Sale Shares by Crown Golden from the Target Company pursuant to the SPA;

‘‘RMB’’ Renminbi, the lawful currency of the PRC;
‘‘Sale Shares’’ the 30 shares of US$1.00 par value each of Crown Golden held by the Target Company;
‘‘SFC’’ Securities and Futures Commission of Hong Kong;
‘‘SFO’’ the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong);
‘‘Shares’’ ordinary share(s) in the capital of the Company with a nominal value of HK$0.10 each;
‘‘Shareholder(s)’’

holder(s) of Shares;

‘‘Shareholders’ The shareholders’ agreement entered into between Forever Agreement’’ Fame, the Target Company and Crown Golden on 30 June 2008, which sets out their respective rights and obligations of the parties thereto in respect of Crown Golden Group in which Forever Fame has certain preferential rights to purchase the securities of Crown Golden in the event of certain proposed direct or indirect transfer;
‘‘SPA’’ the sale and purchase agreement relating to the Repurchase entered into by the Target Company as the seller, Crown Golden as the purchaser and Forever Fame as the guarantor of the purchaser on 9 May 2017;
‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited;
‘‘substantial has the meaning ascribed to it under the Listing Rules; shareholder’’

– 3 –

DEFINITIONS

‘‘Target Company’’ Crystal I Limited, a company incorporated in the Cayman Islands with limited liability;

‘‘Transaction The SPA, the documents referred to in it and any other Documents’’ agreements executed or to be executed by the parties to the SPA on the date of the SPA or Completion;
‘‘Transfer Notice’’ the notice dated 5 April 2017 from the Target Company to Forever Fame pursuant to the Shareholders’ Agreement, notifying the intention of Jade VII, Inc and SSF III Honolulu Holdings Limited to sell 100% equity interests in the Target Company to third party purchaser(s);
‘‘US$’’ United States dollars, the lawful currency of the United States of America; and

‘‘%’’ per cent.

In this circular, the terms ‘‘connected transaction’’, ‘‘major transaction’’ and ‘‘subsidiary’’ shall have the meanings given to such terms in the Listing Rules, unless the context otherwise requires.

Certain amounts and percentage figures included in this circular have been subject to rounding adjustments. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures preceding them.

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LETTER FROM THE BOARD

AGILE GROUP HOLDINGS LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 3383)

Directors:

Mr. Chen Zhuo Lin (Chairman and President) Mr. Chan Cheuk Yin (Vice Chairperson) Madam Luk Sin Fong, Fion (Vice Chairperson) Mr. Chan Cheuk Hung Mr. Huang Fengchao Mr. Chen Zhongqi Mr. Chan Cheuk Hei Mr. Chan Cheuk Nam Dr. Cheng Hon Kwan[#] GBS, OBE, JP Mr. Kwong Che Keung, Gordon[#]

Mr. Cheung Wing Yui, Edward[#] BBS

Mr. Hui Chiu Chung, Stephen[#] JP

Mr. Wong Shiu Hoi, Peter[#]

Registered Office: Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman KY1-1111 Cayman Islands

Principal office in the PRC: 33rd Floor, Agile Center 26 Huaxia Road Zhujiang New Town Tianhe District, Guangzhou Guangdong Province PRC Postal Code: 510623

Executive Directors
** Non-executive Directors
Independent Non-executive Directors

Principal Place of Business in Hong Kong: 18th Floor Three Pacific Place 1 Queen’s Road East Hong Kong

26 June 2017

To the Shareholders

Dear Sir or Madam,

(1) MAJOR AND CONNECTED TRANSACTION THE PROPOSED REPURCHASE OF

30% EQUITY INTEREST IN CROWN GOLDEN; AND (2) NOTICE OF EGM

INTRODUCTION

Reference is made to the announcement of the Company dated 9 May 2017 pursuant to which Crown Golden (an indirect non-wholly owned subsidiary of the Company) will repurchase the Sale Shares for the Consideration and will cancel the same subsequently.

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LETTER FROM THE BOARD

As at Latest Practicable Date, Forever Fame and the Target Company held 70% and 30% equity interests in Crown Golden respectively. Upon Completion, Forever Fame will become the sole shareholder of Crown Golden and Crown Golden will become an indirect wholly-owned subsidiary of the Company.

On the date of the SPA, the Controlling Shareholder executed an irrevocable undertaking to the Company to, amongst other things, vote in favour of the Repurchase and maintain a shareholding of more than 50% in the issued share capital of Company until the earliest of (i) the Completion or (ii) the termination of the SPA in accordance with its terms.

As at Latest Practicable Date, the Target Company held 30% equity interests in Crown Golden. Since the Target Company is a substantial shareholder of a subsidiary of the Company, the Target Company is therefore a connected person of the Company at the subsidiary level. Accordingly, the Repurchase, if completed, constitutes a connected transaction for the Company under Chapter 14A of the Listing Rules. Given (i) the Board has approved the Repurchase; and (ii) the independent non-executive Directors have confirmed that the Repurchase on the terms and conditions set out in the SPA are fair and reasonable and on normal commercial terms and in the interests of the Company and the Shareholders as a whole, the Repurchase is subject to the reporting and announcement requirements, but is exempted from the circular, independent financial advice and independent shareholders’ approval requirements under Rule 14A.101 of the Listing Rules.

As one of the applicable percentage ratios calculated pursuant to Rule 14.07 of the Listing Rules in respect of the Repurchase exceeds 25% but is less than 100%, the Repurchase, if completed, also constitutes a major transaction for the Company under Chapter 14 of the Listing Rules and is therefore subject to the reporting, announcement and shareholders’ approval requirements under Chapter 14 of the Listing Rules.

The purpose of this circular is to provide you with, among other things, (i) further details of the Repurchase; and (ii) the notice convening the EGM.

MAJOR AND CONNECTED TRANSACTION

Major Terms of the SPA

Date: 9 May 2017 Parties Purchaser: Crown Golden Investments Limited (冠金投資有限公司), a company incorporated in the BVI with limited liability and an indirect non-wholly owned subsidiary of the Company;

Seller: Crystal I Limited, a company incorporated in the Cayman Islands with limited liability; and

– 6 –

LETTER FROM THE BOARD

Guarantor to the Forever Fame Property Development Holdings Limited (譽永房 Purchaser: 地產發展控股有限公司), a company incorporated in the BVI with limited liability and an indirect wholly-owned subsidiary of the Company. Subject matter: Crown Golden has conditionally agreed to repurchase from the Target Company and the Target Company has conditionally agreed to sell to Crown Golden the Sale Shares. The Sale Shares represent 30% of the issued share capital of Crown Golden.

As at Latest Practicable Date, Forever Fame and the Target Company held 70% and 30% equity interests in Crown Golden respectively.

Consideration

The Consideration for the repurchase of the Sale Shares shall be US$900,000,000 and was determined by the parties after arm’s length negotiation with reference to, among other things, (1) the consideration set out in the Transfer Notice; (2) the net asset value of Crown Golden Group; (3) the current operations of Crown Golden Group; and (4) the business prospects of Crown Golden Group. The Consideration will be settled in cash.

Deposit

Crown Golden shall, within five (5) working days after the execution of the SPA, pay the Deposit to the Target Company. The Deposit shall in all cases be non-refundable except where there is a breach by the Target Company under the SPA entitling Crown Golden to terminate the SPA. On 15 May 2017, Crown Golden paid the Deposit to the Target Company.

Conditions Precedent

The sale and purchase of the Sale Shares is conditional upon the Company obtaining approval by the Shareholders of the transactions contemplated under the SPA and the other Transaction Documents at EGM or otherwise (if and in the manner such approval is required under the Listing Rules) (the ‘‘Condition’’).

Guarantee

Forever Fame unconditionally and irrevocably:

(a) guarantees to the Target Company the payment when due of all amounts payable by Crown Golden under or pursuant to the SPA and the other Transaction Documents; and
(b) undertakes to ensure that Crown Golden will perform, when due, all its obligations under or pursuant to the SPA and the other Transaction Documents.

– 7 –

LETTER FROM THE BOARD

If the Completion does not occur on the date of Completion stipulated in the SPA in accordance with the provisions of the SPA, Forever Fame agrees that it shall purchase the Sale Shares from the Target Company upon terms no less favourable to the Target Company than those applicable to the purchase by Crown Golden contemplated under the SPA.

Completion

Completion shall take place on the third working day after the satisfaction of the Condition, or on such other date as the Target Company and Crown Golden may agree.

As a result of the Completion, Crown Golden will become an indirect wholly-owned subsidiary of the Company.

Termination and Break Fee

The Target Company shall be entitled to terminate the SPA with immediate effect by written notice to Crown Golden if:

(a) Crown Golden fails to pay the Deposit to the Target Company;
(b) the Completion has not occurred by the date for Completion stipulated in the SPA and the Target Company has given a notice in writing on or after this date to Crown Golden that the Target Company is ready to proceed with Completion and Completion does not occur within three (3) working days from the date of such notice; or
(c) the Completion has not occurred on or before the Long Stop Date,

in the case of each of (a), (b) and (c) above, the Target Company shall be entitled to retain, and Crown Golden will be deemed to have waived any rights it has in respect of, any Deposit paid. The parties further agree that upon the termination of the SPA by the Target Company, Forever Fame shall pay to the Target Company: (x) a break fee of US$145,000,000 (the ‘‘Break Fee’’), and (y) where the Deposit has been fully paid by Crown Golden, an amount equals US$10,500,000 (being 30% of the Deposit) or (z) where the Deposit has not been fully paid by Crown Golden, an amount equals US$35,000,000 less 70% of any amount of the Deposit which has been paid by Crown Golden together with the interest calculated on the outstanding amount.

Information on Crown Golden

Crown Golden is a company incorporated in the BVI with limited liability on 15 February 2007. Its equity interest is held by Forever Fame and the Target Company as to 70% and 30% respectively, as at Latest Practicable Date. It is an indirect non-wholly owned subsidiary of the Company and is engaged in investment holding.

– 8 –

LETTER FROM THE BOARD

Financial Information of Crown Golden Group

The summary of the financial information prepared in accordance with Hong Kong Financial Reporting Standards of Crown Golden Group for the financial years ended 31 December 2015 and 2016 is as follows:

	For the year	ended
	31 December
	2016	2015
	RMB’000	RMB’000
Profit before income tax	1,221,801	2,783,669
Profit after income tax	578,178	1,244,150
Net assets	6,876,616	6,807,309

Upon Completion, Crown Golden will become an indirect wholly-owned subsidiary of the Company.

The audited consolidated total assets and total liabilities of the Group as at 31 December 2016 as extracted from the published annual report of the Company for the year ended 31 December 2016 were approximately RMB131,725 million and approximately RMB87,570 million respectively. Based on the unaudited pro forma financial information of the Enlarged Group (as defined under Appendix II to this Circular) as set out in Appendix II to this circular, assuming the Completion had taken place on 31 December 2016, the unaudited pro forma consolidated total assets and total liabilities of the Enlarged Group would have been approximately RMB125,482 million and approximately RMB87,573 million respectively.

Before the Repurchase, the Company indirectly owns 70% equity interests in Crown Golden. Thus, the accounts of Crown Golden Group are consolidated by the Company and the remaining 30% equity interests held by the Target Company as non-controlling interests. Upon Completion, the Company will indirectly own 100% equity interests in Crown Golden. The difference of approximately RMB4,180 million between the Consideration of US$900 million (equivalent to approximately RMB6,243 million) and the carrying amount of the 30% equity interests will be debited to other reserves.

Crown Golden Group recorded a consolidated profit after taxation of approximately RMB578 million for the year ended 31 December 2016. In light of the positive outlook of the property development business and other factors considered by the Directors as stated in the sections headed ‘‘Reasons for and Benefits of the Repurchase’’ below and ‘‘Financial and Trading Prospects of the Group’’ in Appendix I to this circular, the Directors are of the view that the Repurchase will have a positive impact on the business operation of the Enlarged Group as the Company will have better control of Crown Golden Group. As such, the Enlarged Group can utilise all the cash resources of Crown Golden Group and implement plans in relation to tax, business and financial aspects of Crown Golden Group in line with the development strategy and business plan of the Enlarged Group.

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LETTER FROM THE BOARD

It should be noted that the above financial effects of the Repurchase are for illustration purpose only. The actual financial effects of the Repurchase on the Enlarged Group may be different from the amounts presented in this section.

Management Discussion and Analysis on Grown Golden Group

The following is the management discussion and analysis on Crown Golden Group for the years ended 31 December 2016, 2015 and 2014 which is prepared based on the financial information of Crown Golden Group as set out in Appendix IV to this circular.

Business and financial review

Revenue from property development consists of proceeds from sales of properties. Since Crown Golden Group derives substantially all of its sales revenue from the property development segment, its results of operations for a given period are dependent upon the gross floor area (the ‘‘GFA’’) of property it has available for sale during that period, the market demand for those properties and the price it is able to obtain for such properties.

Crown Golden Group recognises revenue from sales of properties based on the completion method. Revenue from the sale of a property is recognised when the relevant property has been delivered to the purchaser.

Segment results

The table below sets forth the revenue by segments and their percentage of the total revenue for the periods indicated:

Sales of developed properties Property management services Hotel operations Rental income from investment properties Crown Golden Group	2016 RMB’000 7,952,193 103,242 148,765 7,258 8,211,458	For the year ended 31 December 2015 2014 % RMB’000 % RMB’000 96.84 6,724,311 96.60 6,153,706 1.26 84,976 1.22 65,426 1.81 148,681 2.14 100,175 0.09 2,651 0.04 6,975 100.00 6,960,619 100.0 6,326,282	% 97.27 1.04 1.58 0.11
			100.00

For the year ended 31 December 2016

The revenue of Crown Golden Group for the year ended 31 December 2016 amounted to RMB8,211 million (2015: RMB6,961 million), representing an increase of 18.0% as compared to the previous year. The increase was mainly due to an increase in revenue from the sales of developed properties in 2016.

Revenue generated from the sales of developed properties accounted for 96.8% of total revenue in 2016, representing an increase of 18.3% as compared to the corresponding period of 2015. This was mainly due to a 26.7% increase in total GFA sold to 0.59 million sq.m. in 2016 from 0.47 million sq.m. in 2015. Revenue from property management services,

– 10 –

LETTER FROM THE BOARD

hotel operations and rental income from investment properties accounted for 3.2% of the total revenue, representing an increase of 9.7% as compared to the corresponding period of 2015.

Profit for the year decreased by 53.5% to RMB578 million as compared to RMB1,244 million in 2015.

For the year ended 31 December 2015

The revenue of Crown Golden Group for the year ended 31 December 2015 amounted to RMB6,961 million (2014: RMB6,326 million), representing an increase of 10.0% as compared to the previous year. The increase was mainly due to an increase in revenue from the sales of developed properties in 2015.

Revenue generated from the sales of developed properties accounted for 96.6% of total revenue in 2015, representing an increase of 9.3% as compared to the corresponding period of 2014. This was mainly due to a 29.1% increase in total GFA sold to 0.47 million sq.m. in 2015 from 0.36 million sq.m. in 2014. Revenue from property management services, hotel operations and rental income from investment properties accounted for 3.4% of the total revenue, representing an increase of 36.9% as compared to the corresponding period of 2014.

Profit for the year increased by 20.8% to RMB1,244 million as compared to RMB1,030 million in 2014.

Liquidity and financial resources

The table below sets forth Crown Golden Group’s borrowings as of 31 December 2016, 2015 and 2014.

Carrying amounts of borrowings repayable Within 1 year Later than 1 year but not more than 2 years Later than 2 year but not more than 5 years Over 5 years Total	As 2016 RMB’000 369,999 220,000 300,000 — 889,999	at 31 December 2015 2014 RMB’000 RMB’000 725,200 671,577 — 144,330 757,409 — 520,987 630,741 2,003,596 1,446,648	at 31 December 2015 2014 RMB’000 RMB’000 725,200 671,577 — 144,330 757,409 — 520,987 630,741 2,003,596 1,446,648
			1,446,648

– 11 –

LETTER FROM THE BOARD

As at 31 December 2016, 2015 and 2014, the total borrowings were approximately RMB890 million, RMB2,004 million and RMB1,447 million respectively.

At the end of the reporting period, Crown Golden Group’s total cash and bank balances were as follows:

Restricted cash Cash and cash equivalents Total	As 2016 RMB’000 970,010 2,826,699 3,796,709	at 31 December 2015 2014 RMB’000 RMB’000 171,301 228,811 2,402,361 2,203,236 2,573,662 2,432,047	at 31 December 2015 2014 RMB’000 RMB’000 171,301 228,811 2,402,361 2,203,236 2,573,662 2,432,047
			2,432,047

As at 31 December 2016, 2015 and 2014, Crown Golden Group had total cash and bank balances (including restricted cash, cash and cash equivalents) of RMB3,797 million, RMB2,574 million and RMB2,432 million respectively.

As at 31 December 2016, 2015 and 2014, Crown Golden Group had net cash, which is calculated as total borrowings minus total cash and bank balances, of approximately RMB2,907 million, RMB570 million and RMB985 million.

Pledge of assets

Crown Golden Group’s borrowings were secured by pledge over its land use rights of RMB259 million, RMB481 million and RMB348 million as at 31 December 2016, 2015 and 2014 respectively.

Contingent liabilities

As at 31 December 2016, 2015 and 2014, Crown Golden Group provided guarantees to PRC banks for loans of RMB3,082 million, RMB1,585 million and RMB834 million respectively in respect of mortgage loan facilities provided by the banks to property buyers of its properties. Such guarantees will be discharged upon the earlier of (i) issuance of the real estate ownership certificate which will generally be available within one year after the purchasers take possession of the relevant property; and (ii) the full repayment of the relevant mortgage loan by the purchasers.

Employment and remuneration policy

Crown Golden Group remunerates its employees based on their performance, working experience and the prevailing market wage level. The total remuneration of the employees mainly consisted of basic salary and cash bonus. As at 31 December 2016, Crown Golden Group had a total of 1,561 employees. For the years ended 31 December 2016, 2015 and 2014, the total remuneration costs were approximately RMB210 million, RMB268 million and RMB269 million respectively.

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LETTER FROM THE BOARD

Information on Crown Golden Group

Crown Golden Group is principally engaged in the development of Hainan Clearwater Bay in Hainan, the PRC, which are high-end resort and residential development projects. Details of this development are all included in Appendix III of this circular in relation to the valuation report on the Property.

Information of the Target Company

As at Latest Practicable Date, Jade VII, Inc. and SSF II Honolulu Holdings Limited held an aggregate of 100% equity interests in the Target Company which in turn holds 30% equity interests in Crown Golden. It is principally engaged in investment holding.

Information of the Group

The Group is one of the leading property developers in the PRC and is principally engaged in the development of large-scale comprehensive property projects, with extensive presence in the businesses of hotel operations, property investment, property management and environmental protection.

Reasons for and Benefits of the Repurchase

The Directors consider that the Repurchase is in line with the Group’s principal activities.

The Board believes that if the Repurchase is completed, it will have a positive impact on the business operation of Crown Golden Group as the Company will have better control of Crown Golden Group. As such, the Enlarged Group can utilise the cash resources of Crown Golden Group and more effectively implement plans in relation to tax, business and financial aspects of Crown Golden Group with more flexibility. Accordingly, the Board considers that the Repurchase will enable the Group to generate income and provide capital appreciation potential to the Group.

Based on the valuation report of the Property held by Crown Golden Group, the market value of the Property as at 30 April 2017 is RMB24,189,000,000. Although the net assets of Crown Golden Group reflected by the accounts of Crown Golden Group as at the 31 December 2016 was RMB6,876,616,000, 30% of which is less than the Consideration under the SPA, the Directors are of the view that the terms and conditions as set out in the SPA are fair and reasonable and the Repurchase is in the interests of the Company and the Shareholders as a whole taking into consideration the market value of the Property and the positive impact the Repurchase that will bring to the Enlarged Group.

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LETTER FROM THE BOARD

Listing Rules Implications

As at Latest Practicable Date, the Target Company held 30% equity interests in Crown Golden (an indirect non-wholly owned subsidiary of the Company). Since the Target Company is a substantial shareholder of a subsidiary of the Company, the Target Company is a connected person of the Company at the subsidiary level. Accordingly, the Repurchase, if completed, constitutes a connected transaction for the Company under Chapter 14A of the Listing Rules. Given (i) the Board has approved the Repurchase; and (ii) the independent non-executive Directors have confirmed that the Repurchase on the terms and conditions set out in the SPA are fair and reasonable and on normal commercial terms and in the interests of the Company and the Shareholders as a whole, the Repurchase is subject to the reporting and announcement requirements, but is exempted from the circular, independent financial advice and independent shareholders’ approval requirements under Rule 14A.101 of the Listing Rules.

None of the Directors is considered to have a material interest in the Repurchase and therefore no Director is required to abstain from voting on the relevant resolutions for approving the Repurchase.

The EGM

The EGM will be convened at which an ordinary resolution will be proposed to seek the Shareholders’ approval of, amongst other things, the Repurchase. Target Company, together with its associates, are interested in the relevant resolutions approving the SPA so that they should abstain from voting at the EGM in respect of the aforesaid ordinary resolution.

A proxy form for use at the EGM is enclosed with this circular. Whether or not a Shareholder intends to attend the EGM in person, such Shareholder is requested to complete the form of proxy in accordance with the instructions printed thereon and return the same to the Company’s branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong as soon as possible and in any event not less than 48 hours before the time fixed for holding of the EGM (or any adjournment thereof). Completion and return of the form of

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LETTER FROM THE BOARD

proxy will not preclude a Shareholder from attending and voting in person at the EGM (or any adjournment thereof) should they so wish, and in such event, the form of proxy shall be deemed to be revoked.

Pursuant to Rule 13.39(4) of the Listing Rules, voting by the Shareholders at the EGM will be by poll except where the chairman, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands.

Warning of the Risks of Dealings in the Shares

Shareholders and potential investors of the Company shall be fully aware the Completion may or may not proceed, as it is subject to fulfillment of Condition. Accordingly, Shareholders are advised to exercise extreme cautions when dealing in the securities of the Company, and if they are in any doubt about their position, they should consult their professional advisers.

RECOMMENDATION

The Board considers that the Repurchase is fair and reasonable and on normal commercial terms, and is in the interests of the Company and the Shareholders as a whole. Accordingly, the Board (including the independent non-executive Directors) recommends the Shareholders to vote in favour of the ordinary resolution(s) to be proposed at the EGM to approve the Repurchase.

FURTHER INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this circular.

Yours faithfully, By order of the Board Agile Group Holdings Limited CHEN Zhuo Lin Chairman and President

– 15 –

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

1. FINANCIAL INFORMATION OF THE GROUP

The audited financial information of the Group for each of the three years ended 31 December 2014, 2015 and 2016 are disclosed in the annual reports of the Company for the financial years ended 31 December 2014 (http://www.hkexnews.hk/listedco/listconews/ SEHK/2015/0430/LTN20150430548.pdf), 31 December 2015 (http://www.hkexnews.hk/ listedco/listconews/SEHK/2016/0411/LTN20160411285.pdf) and 31 December 2016 (http:// www.hkexnews.hk/listedco/listconews/SEHK/2017/0329/LTN20170329497.pdf) respectively which were published on both the website of Hong Kong Exchange and Clearing Limited (www.hkex.com.hk) and the website of the Company (www.agile.com.cn).

2. INDEBTEDNESS

Borrowings

At the close of business on 30 April 2017, being the latest practicable date for the purpose of this statement of indebtedness, the Group had outstanding borrowings of approximately RMB51,898 million, comprising secured bank borrowings of approximately RMB17,177 million, unsecured bank borrowings of approximately RMB10,949 million, secured senior notes of approximately RMB6,833 million, secured PRC corporate bonds of approximately RMB2,785 million, unsecured PRC corporate bonds of approximately RMB5,965 million, asset-backed securities of approximately RMB824 million and secured other borrowings of approximately RMB7,365 million.

Financial guarantee and contingent liabilities

At the close of business on 30 April 2017, the Group’s financial guarantee and contingent liabilities were as follows:

Guarantee in respect of mortgage facilities for certain purchasers (note (a)) Guarantee in respect of borrowings of an associate Guarantee in respect of borrowings of joint ventures	RMB million 48,610 576 1,275
	50,461

Note (a): At the close of business on 30 April 2017, the Group had provided guarantees in respect of mortgage facilities granted by certain banks relating to the mortgage loans arranged for certain purchasers of properties developed by certain subsidiaries of the Group. The outstanding mortgage loans under these guarantees amounted to approximately RMB48,610 million. Pursuant to the terms of the guarantees, upon default in mortgage payments by these purchasers, the Group is responsible to repay the outstanding mortgage principals together with accrued interest owed by the defaulted purchasers to the financial institutions and the Group is entitled to take over the legal title and possession of the related properties.

– I-1 –

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

Save as aforesaid or otherwise disclosed herein, and apart from intra-group liabilities and normal trade payables in the normal course of business, at the close of business on 30 April 2017, being the latest practicable date for the purpose of this indebtedness statement, the Group did not have any other loan capital issued and outstanding or agreed to be issued, bank overdrafts, loans or other similar indebtedness, liabilities under acceptances (other than normal trade bills) or acceptance credits, debentures, mortgages, charges, hire purchase commitments, guarantees or other material contingent liabilities.

3. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, none of the Directors were aware of any material adverse change in the financial or trading position of the Group since 31 December 2016 (being the date to which the latest published audited financial statements of the Group were made up).

4. WORKING CAPITAL

The Directors are of the opinion that, after taking into account the effects of the Completion and the financial resources available to the Group, the Group has sufficient working capital to satisfy its requirements and for at least the next 12 months from the date of publication of this circular in the absence of unforeseen circumstances.

5. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

Latest official statistics show that the PRC’s real estate market has started to slow down in the past few months due to the austerity measures. Nevertheless, the real estate industry is still an important pillar industry in the PRC, in view of continuous economic growth, relatively low urbanisation level, migration of growing population into the big cities and continuously increasing per capital disposable income.

The Group will cope with the market changes on a timely basis and adopt flexible strategies to develop progressively and steadily by closely monitoring the economic development. The Group will continue to uphold the philosophy of prudent development, adopt a strategy of diversified development to drive a steady growth of all its business segments. The Group will continue to expand the property development business and accelerate its development in business segments such as property management, hotel operations, property investment and environmental protection. More profit centres will be created. While steadily expanding its businesses, the Group will strive to maintain robust cash flows and a reasonable profit margin.

– I-2 –

APPENDIX I

FINANCIAL INFORMATION OF THE GROUP

A premium land bank is the cornerstone of the property development business. The Group will adopt an active but prudent strategy in land acquisition, with priority given to opportunities in cities where existing projects with a competitive edge are located, as well as first — tier and second — tier cities with substantial growth potential.

Upon Completion, the Company will hold 100% interest in the land bank currently owned by Crown Golden Group. The increase in quality land reserves is vital for the Group’s long-term development as the Directors believe that the demand for high quality properties in Hainan Province will continue to increase in the future as a result of the continuously improving economic environment in the PRC. The Repurchase could potentially enhance the financial results of the Group.

– I-3 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

The following is an illustrative and unaudited pro forma statement of assets and liabilities of the Group including Crown Golden Investments Limited (‘‘Crown Golden’’) (collectively referred to as the ‘‘Enlarged Group’’) as at 31 December 2016 (the ‘‘Unaudited Pro Forma Financial Information’’) which has been prepared in accordance with paragraph 4.29 of the Listing Rules. The Unaudited Pro Forma Financial Information has been prepared based on the basis of the notes set out below, which is consistent with the accounting policies of the Group, for the purpose of illustrating the effect of the proposed repurchase of 30% equity interests of Crown Golden (the ‘‘Transaction’’), as if the Transaction had been taken place on 31 December 2016.

This Unaudited Pro Forma Financial Information has been prepared based on the audited consolidated balance sheet of the Company as at 31 December 2016 as set out in the Company’s published annual report for the year ended 31 December 2016. Since the Company indirectly owned 70% equity interests in Crown Golden before the Transaction, the Company will indirectly own 100% equity interest in Crown Golden upon the completion of the Transaction. The difference between the consideration and the carrying amount of the 30% equity interests will be debited to other reserve.

This Unaudited Pro Forma Financial Information has been prepared for illustrative purposes only and because of its hypothetical nature, it may not give a true picture of the financial position of the Enlarged Group had the Transaction been completed as at 31 December 2016 or at any future date.

The Unaudited Pro Forma Financial Information should be read in conjunction with other financial information included elsewhere in this circular.

– II-1 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

UNAUDITED PRO FORMA STATEMENT OF ASSETS AND LIABILITIES OF THE ENLARGED GROUP AS AT 31 DECEMBER 2016

Assets Non-current assets Property, plant and equipment Land use rights Intangible assets Investment properties Properties under development Interests in associates Interests in joint ventures Available-for-sale financial assets Derivative financial instruments Receivables from the associates and joint ventures Deferred income tax assets Current assets Properties under development Completed properties held for sale Prepayments for acquisition of land use rights Trade and other receivables Prepaid income taxes Derivative financial instruments Restricted cash Cash and cash equivalents Total assets	Audited consolidated statement of assets and liabilities of the Group as at 31 December 2016 (Note 1) RMB’000 7,309,147 2,029,966 55,357 6,326,943 9,510,651 114,461 4,624,663 277,500 254,497 4,383,129 699,275 35,585,589 36,706,691 13,976,133 9,614,483 11,462,643 1,760,871 307,870 9,878,734 12,431,884 96,139,309 131,724,898	Pro forma adjustment (Note 2) RMB’000 (6,243,300) (6,243,300) (6,243,300)	Pro forma adjustment (Note 3) RMB’000	Unaudited pro forma statement of assets and liabilities of the Enlarged Group as at 31 December 2016 RMB’000 7,309,147 2,029,966 55,357 6,326,943 9,510,651 114,461 4,624,663 277,500 254,497 4,383,129 699,275
				35,585,589
				36,706,691 13,976,133 9,614,483 11,462,643 1,760,871 307,870 9,878,734 6,188,584
				89,896,009
				125,481,598

– II-2 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

Liabilities Non-current liabilities Borrowings Deferred income tax liabilities Current liabilities Borrowings Trade and other payables Advanced proceeds received from customers Current income tax liabilities Total liabilities	Audited consolidated statement of assets and liabilities of the Group as at 31 December 2016 (Note 1) RMB’000 31,180,908 1,137,167 32,318,075 12,815,016 21,101,960 10,617,432 10,717,185 55,251,593 87,569,668	Pro forma adjustment (Note 2) RMB’000	Pro forma adjustment (Note 3) RMB’000 3,000 3,000 3,000	Unaudited pro forma statement of assets and liabilities of the Enlarged Group as at 31 December 2016 RMB’000 31,180,908 1,137,167
				32,318,075
				12,815,016 21,104,960 10,617,432 10,717,185
				55,254,593
				87,572,668

– II-3 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

NOTES TO THE UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP:

The amounts are extracted from the audited consolidated balance sheet of the Company as at 31 December 2016 as set out in the Company’s published annual report for the year ended 31 December 2016.
Before the Transaction, the Company indirectly owned 70% equity interests in Crown Golden. Thus, the accounts of Crown Golden Group were consolidated by the Company and the remaining 30% equity interests held by Crystal I Limited were recorded as non-controlling interests. Upon the completion of the Transaction, the Company will indirectly own 100% equity interests in Crown Golden. The difference of approximately RMB4,180 million between the Consideration of US$900 million (equivalent to approximately RMB6,243 million) and the carrying amount of the 30% equity interests will be debited to other reserves.

For the purpose of preparing the Unaudited Pro Forma Financial Information, it is assumed that the Consideration will be paid by cash and a deduction of RMB6,243 million in cash and cash equivalents will be recognised to reflect the payment of the Consideration.

The pro forma adjustment represents the estimated amounts for professional fees and other expenses payable by the Group for the Transaction.
Save as aforesaid, no other adjustments have been made to reflect any trading results or other transactions of the Group or Crown Golden Group entered into subsequent to 31 December 2016.

– II-4 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

The following is the text of a report received from PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, for the purpose of incorporation in this circular.

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INDEPENDENT REPORTING ACCOUNTANT’S ASSURANCE REPORT ON THE COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION

To the Directors of Agile Group Holdings Limited

We have completed our assurance engagement to report on the compilation of unaudited pro forma financial information of Agile Group Holdings Limited (the ‘‘Company’’) and its subsidiaries (collectively the ‘‘Group’’) by the directors for illustrative purposes only. The unaudited pro forma financial information consists of the unaudited pro forma consolidated statement of assets and liabilities as at 31 December 2016 and related notes (the ‘‘Unaudited Pro Forma Financial Information’’) as set out on pages II-2 to II-4 of the Company’s circular dated 26 June 2017, in connection with the proposed repurchase of the relevant equity interests of Crown Golden Investments Limited (the ‘‘Transaction’’). The applicable criteria on the basis of which the directors have compiled the Unaudited Pro Forma Financial Information are described on pages II-1 to II-4.

The Unaudited Pro Forma Financial Information has been compiled by the directors to illustrate the impact of the Transaction on the Group’s financial position as at 31 December 2016 as if the Transaction had taken place at 31 December 2016. As part of this process, information about the Group’s financial position has been extracted by the directors from the Group’s financial statements for the year ended 31 December 2016, on which an audit report has been published.

Directors’ Responsibility for the Unaudited Pro Forma Financial Information

The directors are responsible for compiling the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the ‘‘Listing Rules’’) and with reference to Accounting Guideline 7 Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars (‘‘AG 7’’) issued by the Hong Kong Institute of Certified Public Accountants (‘‘HKICPA’’).

– II-5 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

Our Independence and Quality Control

We have complied with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental principles of integrity, objectivity, professional competence and due care, confidentiality and professional behaviour.

Our firm applies Hong Kong Standard on Quality Control 1 issued by the HKICPA and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.

Reporting Accountant’s Responsibilities

Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the Listing Rules, on the Unaudited Pro Forma Financial Information and to report our opinion to you. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the Unaudited Pro Forma Financial Information beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

We conducted our engagement in accordance with Hong Kong Standard on Assurance Engagements 3420, Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus, issued by the HKICPA. This standard requires that the reporting accountant plans and performs procedures to obtain reasonable assurance about whether the directors have compiled the Unaudited Pro Forma Financial Information in accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the HKICPA.

For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial information used in compiling the Unaudited Pro Forma Financial Information, nor have we, in the course of this engagement, performed an audit or review of the financial information used in compiling the Unaudited Pro Forma Financial Information.

The purpose of unaudited pro forma financial information included in a circular is solely to illustrate the impact of a significant event or transaction on unadjusted financial information of the entity as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome of the Transaction at 31 December 2016 would have been as presented.

A reasonable assurance engagement to report on whether the unaudited pro forma financial information has been properly compiled on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by the

– II-6 –

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

directors in the compilation of the unaudited pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to the event or transaction, and to obtain sufficient appropriate evidence about whether:

. The related pro forma adjustments give appropriate effect to those criteria; and
. The unaudited pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information.

The procedures selected depend on the reporting accountant’s judgment, having regard to the reporting accountant’s understanding of the nature of the company, the event or transaction in respect of which the unaudited pro forma financial information has been compiled, and other relevant engagement circumstances.

The engagement also involves evaluating the overall presentation of the unaudited pro forma financial information.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion:

(a) the Unaudited Pro Forma Financial Information has been properly compiled by the directors of the Company on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purposes of the Unaudited Pro Forma Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing Rules.

PricewaterhouseCoopers Certified Public Accountants

Hong Kong, 26 June 2017

– II-7 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

The following is the text of a letter, summary of values and valuation certificates prepared for the purpose of incorporation in this circular received from Savills Valuation and Professional Services Limited, an independent valuer, in connection with their opinion of values of the properties as at 30 April 2017.

The Directors Agile Group Holdings Limited 18th Floor Three Pacific Place 1 Queen’s Road East Hong Kong

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Savills Valuation and Professional Services Limited 23/F Two Exchange Square Central, Hong Kong T: (852) 2801 6100 F: (852) 2530 0756

EA Licence: C-023750 savills.com

26 June 2017

Dear Sirs,

Re: Hainan Clearwater Bay located at Lingshui Li Minority Autonomous County, Hainan Province, the People’s Republic of China

INSTRUCTIONS

In accordance with the instructions from Agile Group Holdings Limited (the ‘‘Company’’) for us to value the properties (the ‘‘Properties’’) situated in the People’s Republic of China (the ‘‘PRC’’) which is held by Crown Golden Investments Limited (‘‘Crown Golden’’), we confirm that we have carried out inspections, made relevant enquiries and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the market values of the Properties as at 30 April 2017 (the ‘‘valuation date’’) for inclusion in a circular.

BASIS OF VALUATION

Our valuation is our opinion of the market value of the property concerned which we would define as intended to mean ‘‘the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion’’.

Market value is understood as the value of an asset or liability estimated without regard to costs of sale or purchase (or transaction) and without offset for any associated taxes or potential taxes.

– III-1 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

Our valuation is prepared in compliance with the requirements set out in Chapter 5 and Practice Note 12 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and in accordance with The HKIS Valuation Standards (2012 Edition) published by The Hong Kong Institute of Surveyors.

VALUATION METHODOLOGY

In valuing the property in Group I, which is held for sale or owner occupation, we have valued the property by the direct comparison approach by making reference to comparable sales transactions as available in the market assuming sale with the benefit of vacant possession.

In valuing the property in Group II, which is held under development, we have valued the property on the basis that it will be developed and completed in accordance with the latest development proposal provided to us. We have assumed that all consents, approvals and licenses from relevant government authorities for the development proposal have been obtained without onerous conditions or delays. In arriving at our opinion of value, we have adopted the direct comparison approach by making reference to comparable sales transactions as available in the market and have also taken into account the cost that will be expended to complete the development to reflect the quality of the completed development.

In valuing the property in Group III, which is held for future development, we have valued the property by the direct comparison approach by making reference to the comparable market transactions as available in the market.

TITLE INVESTIGATION

We have been provided with copies of extracts of title documents relating to the Properties. However, we have not searched the original documents to verify ownership or to ascertain the existence of any amendments which may not appear on the copies provided to us. In the course of our valuation, we have relied to a very considerable extent on the information given by the Company and the legal opinion issued by the PRC’s legal adviser to the Company, Jingtian & Gongcheng Attorneys at Law (北京市競天公誠律師事務所), regarding the titles to the Properties. As advised by the Company, there is no breach of environmental regulations and investigations against the Properties.

SOURCES OF INFORMATION

In the course of our valuation, we have relied to a very considerable extent on information given by the Company and accepted advice given to us on such matters as planning approvals, statutory notices, easements, tenure, particulars of occupancy, development proposals, total and outstanding construction costs, estimated completion dates, site and floor areas, transaction records, sale prices, sales and purchase agreements and all other relevant matters. Dimensions, measurements and areas included in the valuation certificate are based on the information provided to us and are therefore only approximations. No on-site measurements have been taken. We have no reason to doubt the truth and accuracy of the information provided to us by the Company, which is material to

– III-2 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

our valuation. We have also sought confirmation from the Company that no material facts have been omitted from the information supplied. We consider that we have been provided with sufficient information to reach an informed view.

VALUATION ASSUMPTIONS

In the course of our valuation, unless otherwise stated, we have assumed that transferable land use rights in respect of the Properties for their respective specific terms at nominal annual land use fees have been granted and that any land grant premium payable has already been fully paid. We have also assumed that, unless otherwise stated, the owner of the Properties has proper legal titles to each of the Properties and has free and uninterrupted rights to use, occupy, lease or assign the Properties for the whole of the respective unexpired terms as granted.

No allowance has been made in our valuation for any charges, mortgages or amounts owing on any property nor for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the Properties are free from encumbrances, restrictions and outgoings of an onerous nature which could affect their values.

SITE INSPECTION

We have inspected the exterior and, wherever possible, the interior of the Properties. Site inspections of the Properties were carried out in June 2017 by our Mr. Eric Wong and Ms. Josephine Yue. Mr. Eric Wong is a professional member of the Royal Institution of Chartered Surveyors. During the course of our inspections, we did not note any serious defects. However, no structural survey has been made and we are therefore unable to report that the Properties are free from rot, infestation and any other defects. No tests were carried out on any of the services. We have also not carried out investigations on site to determine the suitability of the ground conditions and the services for any future development. Our valuation is prepared on the assumption that these aspects are satisfactory and that no extraordinary expenses or delays will be incurred during the construction period.

CURRENCY

Unless otherwise stated, all money amounts stated are in Renminbi (‘‘RMB’’).

We enclose herewith our summary of values and valuation certificates.

Yours faithfully, For and on behalf of Savills Valuation and Professional Services Limited Anthony C K Lau MRICS MHKIS RPS(GP) Director

Note: Mr. Anthony C.K. Lau is a professional surveyor who has over 24 years’ experience in valuation of properties in Hong Kong and the PRC.

– III-3 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

SUMMARY OF VALUES

Market value in
existing state as at
No. Property 30 April 2017 (RMB)
Group I — Property held for sale or owner occupation in the PRC 1. Portion of land lot Nos. A01-1, A01-3, A03, A04-4, A04-5, A044,243,000,000 6, A04-7, A04-10, A05-1, A05-2, A05-3, A05-4, A06-1, A06-4, A08, A09-1, A09-2, A10-1, A11-2, A13-1, A16-1, A16-3, A26, A30, B02-1 and B07-1, Hainan Clearwater Bay, Lingshui Li Minority Autonomous County, Hainan Province, PRC Group I Sub-total: 4,243,000,000
Group II — Property held under development in the PRC 2. Portion of land lot Nos. A01-1, A01-3, A06-1, A06-4, A07, A0915,210,000,000 3, A10-2, A11-1, A11-2, A13-1, B01-2, B02-2, B04-1, B05-1, B07-1, B10, B11-1 and B11-2, Hainan Clearwater Bay, Lingshui Li Minority Autonomous County, Hainan Province, PRC Group II Sub-total: 15,210,000,000
Group III — Property held for future development in the PRC
Portion of land lot Nos. A01-4, A03-1, A04-2, A04-3, A04-11, 4,736,000,000 A06-1, A06-4, A06-2, A06-3, A10-1, A12-1, A13-1, A13-2, A151, A15-2, A16-2, A16-3, B01-1, B02-2, B04-1, B05-1, B06-1, B06-4, B07-1, B09, B11-1, B11-2 and B11-3, Hainan Clearwater Bay, Lingshui Li Minority Autonomous County, Hainan Province, PRC

Group III Sub-total: Grand Total:	4,736,000,000
	24,189,000,000

– III-4 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

VALUATION CERTIFICATE

Group I — Property held for sale or owner occupation in the PRC

Particulars of occupancy

Description and tenure

No. Property

Portion of land lot Hainan Agile Clearwater Bay (the Nos. A01-1, A01-3, ‘‘Development’’)Development’’)’’) occupies several parcels of A03, A04-4, A04-5, land with a total site area of approximately A04-6, A04-7, A04-10, 9,796,114.30 sq.m. and will comprise a largeA05-1, A05-2, A05-3, scale mixed residential and commercial A05-4, A06-1, A06-4, development upon full completion. A08, A09-1, A09-2, A10-1, A11-2, A13-1, The Development is located at the northern A16-1, A16-3, A26, side of Jiusuoling Forest Park, southern side A30, B02-1 and B07-1, of Lingshui Bay, western side of Yingzhou Hainan Clearwater Town and the eastern side of Xincun Town. Bay, Lingshui Li Developments in the vicinity are dominated Minority Autonomous by low-rise and medium-rise residential County, Hainan developments. It takes about a 40-minute Province, PRC drive to the Sanya Phoenix International Airport from the Development.
Hainan Agile Clearwater Bay (the As at the valuation ‘‘Development’’)Development’’)’’) occupies several parcels of date, the property was land with a total site area of approximately vacant. 9,796,114.30 sq.m. and will comprise a largescale mixed residential and commercial development upon full completion.

Market value in existing state as at 30 April 2017

RMB4,243,000,000 (Renminbi Four Billion Two Hundred Forty Three Million)

The property comprises various residential and retail units, hotels and ancillary facilities of the Development with a total gross floor area of approximately 324,867.24 sq.m.. Details of the uses and approximate gross floor areas of the property are as follows:

Use Villa Apartment Retail Hotel Ancillary Facilities Total:	Approximate Gross Floor Area (sq.m.) 33,265.85 40,789.49 21,148.64 157,763.00 71,900.26
	324,867.24

As advised by the Company, the property was completed in between 2009 and 2016.

The land use rights of the Development have been granted for terms with the expiry dates between May 2047 and 26 September 2085 for commercial, residential, hotel and public facilities uses.

– III-5 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

Notes:

Pursuant to 13 State-owned Land Use Rights Grant Contracts dated between 9 June 2013 and 26 September 2016, the land use rights of various parcels of land with a total site area of approximately 691,701.50 sq.m. have been granted to Hainan Agile Real Estate Development Co., Ltd. (‘‘海南雅居樂房地產開發有限公司’’) (‘‘Hainan Agile’’), a 70%-owned subsidiary of the Company, for terms with the expiry dates between 2 November 2063 and 26 September 2085 for commercial, residential, hotel and public facilities uses at a total land grant fee of RMB930,346,751.

Pursuant to two State-owned Land Use Rights Grant Contracts dated between 15 May 2013 and 26 September 2015, the land use rights of various parcels of land with a total site area of approximately 30,418.30 sq.m. have been granted to Hainan Yaheng Real Estate Development Co., Ltd. (‘‘海南雅恒房地產發展有限公司’’) (‘‘Hainan Yaheng’’), a 70%-owned subsidiary of the Company, for terms with the expiry dates between 15 September 2063 and 26 September 2085 for commercial, residential and public facilities uses at a total land grant fee of RMB14,109,708.

As advised by the Company, the land parcels as stated in the State-owned Land Use Rights Grant Contracts mentioned above only comprise portion of the Development.

Pursuant to 37 State-owned Land Use Rights Certificates dated between 9 June 2007 and 14 March 2016, the land use rights of various parcels of land with a total site area of approximately 9,796,114.30 sq.m. have been granted to Hainan Agile and Hainan Yaheng for terms with the expiry dates between May 2047 and 26 September 2085 for commercial, residential, hotel and public facilities uses.

As advised by the Company, the land parcels as stated in the State-owned Land Use Rights Certificates mentioned above only comprise portion of the Development.

Pursuant to 53 Construction Land Planning Permits dated between 26 April 2007 and 21 April 2017, Hainan Agile and Hainan Yaheng were permitted to use various parcels of land with a total site area of approximately 9,961,469.76 sq.m. for development.

As advised by the Company, the land parcels as stated in the Construction Land Planning Permits mentioned above only comprise portion of the Development.

Pursuant to 31 Construction Works Planning Permits dated between 26 May 2008 and 29 December 2016, the approved construction scale of various buildings is approximately 6,826,840.77 sq.m..

As advised by the Company, the property only comprises portion of the buildings as stated in the Construction Works Planning Permits mentioned above.

Pursuant to 195 Construction Works Commencement Permits dated between 28 January 2008 and 26 April 2017, the construction works of various buildings with a total construction scale of approximately 6,416,852.86 sq.m. were permitted for commencement.

As advised by the Company, the property only comprises portion of the buildings as stated in the Construction Works Commencement Permits mentioned above.

Pursuant to 159 Completion Certificates dated between 5 March 2009 and 30 December 2016, the construction works of the various buildings have been examined and such examination was recorded.

As advised by the Company, the property only comprises portion of the buildings as stated in the Completion Certificates mentioned above.

– III-6 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

Pursuant to 73 Pre-sale Permits dated between 18 November 2008 and 28 April 2017, various buildings with a total gross floor area of approximately 3,268,162.18 sq.m. were permitted for pre-sale.

As advised by the Company, the buildings as stated in the Pre-sale Permits mentioned above only comprise portion of the property.

Pursuant to 135 Building Ownership Certificates, the building ownership of the property with a total gross floor area of 2,117,874.25 sq.m. is vested in Hainan Agile and Hainan Yaheng.

As advised by the Company, the buildings as stated in the Building Ownership Certificates mentioned above only comprise portion of the property.

As advised by the Company, portion of the property with a total gross floor area of approximately 6,372.57 sq.m. has been contracted for sale under various sale and purchase agreements at a total consideration of approximately RMB196,500,000 which has not been delivered to the buyers. We have taken into account the aforesaid amount in our valuation.
We have been provided with a legal opinion on the title to the property issued by the Company’s PRC legal adviser, which contains, inter alia, the following information:
i. Hainan Agile and Hainan Yaheng have legally obtained the land use rights and building ownership of the property and are entitled to occupy, use, lease, transfer, mortgage or by other legal means dispose of the property within the residual term of its land use rights according to the PRC laws;
ii. as the land use rights grant contracts have been signed and the land grant fee together with other relevant taxes have been fully paid, there is no substantial legal impediment for Hainan Agile to obtain the land use rights of land lot No. A16-3 of the property;
iii. as confirmed by the Company, Hainan Agile and Hainan Yaheng have obtained the necessary permits, approvals and certificates for the construction of the property;
iv. as confirmed by the Company, Hainan Agile and Hainan Yaheng have obtained the pre-sale permits for portion of the property and are entitled to pre-sell such portion of the property;
v. as confirmed by the Company, the property is subject to various mortgages; and
vi. in respect of the mortgages, prior approval from the mortgagee has to be obtained within the mortgage period before Hainan Agile and Hainan Yaheng can transfer, let, mortgage or by other legal means to dispose of the property.

– III-7 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

VALUATION CERTIFICATE

Group II — Property held under development in the PRC

Particulars of occupancy

No. Property Description and tenure

Portion of land lot Hainan Agile Clearwater Bay (the Nos. A01-1, A01-3, ‘‘Development’’)Development’’)’’) occupies several parcels of A06-1, A06-4, A07, land with a total site area of approximately A09-3, A10-2, A11-1, 9,796,114.30 sq.m. and will comprise a largeA11-2, A13-1, B01-2, scale mixed residential and commercial B02-2, B04-1, B05-1, development upon full completion. B07-1, B10, B11-1 and B11-2, Hainan The Development is located at the northern Clearwater Bay, side of Jiusuoling Forest Park, southern side Lingshui Li Minority of Lingshui Bay, western side of Yingzhou Autonomous County, Town and the eastern side of Xincun Town. Hainan Province, PRC Developments in the vicinity are dominated by low-rise and medium-rise residential developments. It takes about a 40-minute drive to the Sanya Phoenix International Airport from the Development.

Hainan Agile Clearwater Bay (the As at the valuation ‘‘Development’’)Development’’)’’) occupies several parcels of date, the property was land with a total site area of approximately under construction. 9,796,114.30 sq.m. and will comprise a largescale mixed residential and commercial development upon full completion.

Market value in existing state as at 30 April 2017

RMB15,210,000,000 (Renminbi Fifteen Billion Two Hundred Ten Million)

According to the latest development proposal provided by the Company, the property will have a total gross floor area of approximately 2,624,005.08 sq.m. upon completion. Details of the uses and approximate gross floor areas of the property are as follows:

Use Villa Apartment Retail Hotel Ancillary Facilities Total:	Approximate Gross Floor Area (sq.m.) 350,788.02 1,799,720.63 2,793.25 452,836.82 17,866.36
	2,624,005.08

As advised by the Company, the property is scheduled for completion in between 2nd quarter of 2017 and 2nd quarter of 2019.

The land use rights of the property have been granted for terms with the expiry dates between May 2017 and 26 September 2085 for commercial, residential, hotel and public facilities uses.

– III-8 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

Notes:

Pursuant to 13 State-owned Land Use Rights Grant Contracts dated between 9 June 2013 and 26 September 2016, the land use rights of various parcels of land with a total site area of approximately 691,701.50 sq.m. have been granted to Hainan Agile Real Estate Development Co., Ltd. (‘‘海南雅居樂房地產開發有限公司’’) (‘‘Hainan Agile’’), a 70%-owned subsidiary of the Company, for terms with the expiry dates between 2 November 2063 and 26 September 2085 for commercial, residential, hotel and public facilities uses at a total land grant fee of RMB930,346,751.

As advised by the Company, the land parcels as stated in the State-owned Land Use Rights Grant Contracts mentioned above only comprise portion of the Development.

Pursuant to 37 State-owned Land Use Rights Certificates dated between 9 June 2007 and 14 March 2016, the land use rights of various parcels of land with a total site area of approximately 9,796,114.30 sq.m. have been granted to Hainan Agile and Hainan Yaheng for terms with the expiry dates between May 2047 and 26 September 2085 for commercial, residential, hotel and public facilities uses.

As advised by the Company, the land parcels as stated in the State-owned Land Use Rights Certificates mentioned above only comprise portion of the Development.

Pursuant to 53 Construction Land Planning Permits dated between 26 April 2007 and 21 April 2017, Hainan Agile and Hainan Yaheng were permitted to use various parcels of land with a total site area of approximately 9,961,469.76 sq.m. for development.

As advised by the Company, the land parcels as stated in the Construction Land Planning Permits mentioned above only comprise portion of the Development.

Pursuant to 31 Construction Works Planning Permits dated between 26 May 2008 and 29 December 2016, the approved construction scale of various buildings is approximately 6,826,840.77 sq.m..

As advised by the Company, the property only comprises portion of the buildings as stated in the Construction Works Planning Permits mentioned above.

Pursuant to 195 Construction Works Commencement Permits dated between 28 January 2008 and 26 April 2017, the construction works of various buildings with a total construction scale of approximately 6,416,852.86 sq.m. were permitted for commencement.

As advised by the Company, the Property comprises portion of the buildings as stated in the Construction Works Commencement Permits mentioned above.

Pursuant to 73 Pre-sale Permits dated between 18 November 2008 and 28 April 2017, various buildings with a total gross floor area of approximately 3,268,162.18 sq.m. were permitted for pre-sale.

As advised by the Company, the buildings as stated in the Pre-sale Permits mentioned above only comprise portion of the property.

– III-9 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

As advised by the Company, the total construction cost expended for the property as at the valuation date was approximately RMB2,925,500,000 and the estimated outstanding construction cost to be expended as at the valuation date would be approximately RMB16,125,800,000. We have taken into account the said amounts in our valuation.
As advised by the Company, portion of the property with a total gross floor area of approximately 269,706.20 sq.m. has been contracted for sale under various sale and purchase agreements at a total consideration of approximately RMB5,913,700,000 which has not been delivered to the buyers. We have taken into account the aforesaid amount in our valuation.
The market value of the property as if completed as at the valuation date is in the sum of RMB41,009,800,000.
We have been provided with a legal opinion on the title to the property issued by the Company’s PRC legal adviser, which contains, inter alia, the following information:
i. Hainan Agile and Hainan Yaheng have legally obtained the land use rights and building ownership of the property and are entitled to occupy, use, lease, transfer, mortgage or by other legal means dispose of the property within the residual term of its land use rights according to the PRC laws;
ii. as confirmed by the Company, Hainan Agile and Hainan Yaheng have obtained the necessary permits, approvals and certificates for the construction of the property;
iii. as confirmed by the Company, Hainan Agile and Hainan Yaheng have obtained the pre-sale permits for portion of the property and are entitled to pre-sell such portion of the property;
iv. as confirmed by the Company, the property is subject to various mortgages; and
v. in respect of the mortgages, prior approval from the mortgagee has to be obtained within the mortgage period before Hainan Agile and Hainan Yaheng can transfer, let, mortgage or by other legal means to dispose of the property.

– III-10 –

APPENDIX III

VALUATION REPORT ON THE PROPERTY

VALUATION CERTIFICATE

Group III — Property held for future development in the PRC

Market value

No. Property Description and tenure

Particulars of occupancy

in existing state as at 30 April 2017

Portion of land lot Hainan Agile Clearwater Bay (the As at the valuation RMB4,736,000,000 Nos. A01-4, A03-1, ‘‘Development’’) occupies several parcels of date, the property was (Renminbi Four A04-2, A04-3, A04-11, land with a total site area of approximately bare land. Billion Seven Hundred A06-1, A06-4, A06-2, 9,796,114.30 sq.m. and will comprise a largeThirty Six Million) A06-3, A10-1, A12-1, scale mixed residential and commercial A13-1, A13-2, A15-1, development upon full completion. A15-2, A16-2, A16-3, B01-1, B02-2, B04-1, The Development is located at the northern B05-1, B06-1, B06-4, side of Jiusuoling Forest Park, southern side B07-1, B09, B11-1, of Lingshui Bay, western side of Yingzhou B11-2 and B11-3, Town and the eastern side of Xincun Town. Hainan Clearwater Developments in the vicinity are dominated Bay, Lingshui Li by low-rise and medium-rise residential Minority Autonomous developments. It takes about a 40-minute County, Hainan drive to the Sanya Phoenix International Province, PRC Airport from the Development.

According to the latest development proposal provided by the Company, the property will have a total planned gross floor area of approximately 2,153,105.40 sq.m..

The land use rights of the Development have been granted for terms with expiry dates between May 2017 and 26 September 2085 for commercial, residential, hotel and public facilities uses.

Notes:

Pursuant to 13 State-owned Land Use Rights Grant Contracts dated between 9 June 2013 and 26 September 2016, the land use rights of various parcels of land with a total site area of approximately 691,701.50 sq.m. have been granted to Hainan Agile Real Estate Development Co., Ltd. (‘‘海南雅居樂房地產開發有限公司’’) (‘‘Hainan Agile’’), a 70%-owned subsidiary of the Company, for terms with the expiry dates between 2 November 2063 and 26 September 2085 for commercial, residential, hotel and public facilities uses at a total land grant fee of RMB930,346,751.

As advised by the Company, the land parcels as stated in the State-owned Land Use Rights Grant Contracts mentioned above only comprise portion of the Development.

– III-11 –

VALUATION REPORT ON THE PROPERTY

APPENDIX III

Pursuant to 37 State-owned Land Use Rights Certificates dated between 9 June 2007 and 14 March 2016, the land use rights of various parcels of land with a total site area of approximately 9,796,114.30 sq.m. have been granted to Hainan Agile and Hainan Yaheng for terms with the expiry dates between May 2047 and 26 September 2085 for commercial, residential, hotel and public facilities uses.

As advised by the Company, the land parcels as stated in the State-owned Land Use Rights Certificates mentioned above only comprise portion of the Development.

Pursuant to 53 Construction Land Planning Permits dated between 26 April 2007 and 21 April 2017, Hainan Agile and Hainan Yaheng were permitted to use various parcels of land with a total site area of approximately 9,961,469.76 sq.m. for development.

As advised by the Company, the land parcels as stated in the Construction Land Planning Permits mentioned above only comprise portion of the Development.

Pursuant to 31 Construction Works Planning Permits dated between 26 May 2008 and 29 December 2016, the approved construction scale of various buildings is approximately 6,826,840.77 sq.m..

As advised by the Company, the property only comprises portion of the buildings as stated in the Construction Works Planning Permits mentioned above.

We have been provided with a legal opinion on the title to the property issued by the Company’s PRC legal adviser, which contains, inter alia, the following information:
i. Hainan Agile and Hainan Yaheng have legally obtained the land use rights and building ownership of the property and are entitled to occupy, use, lease, transfer, mortgage or by other legal means dispose of the property within the residual term of its land use rights according to the PRC laws;
ii. as the land use rights grant contracts have been signed and the land grant fee together with other relevant taxes have been fully paid, there is no substantial legal impediment for Hainan Yaheng to obtain the land use rights of land lot No. A15-2 of the property;
iii. as confirmed by the Company, there is the risk that Hainan Agile and Hainan Yaheng will be subject to idle land fees and/or forfeiture of land for the delay in commencement of construction works of land lot Nos. A01-4, A04-3, A04-11, A15-2 and B06-4 of the property;
iv. as confirmed by the Company, Hainan Agile and Hainan Yaheng have obtained the necessary permits, approvals and certificates for the construction of the property;
v. as confirmed by the Company, Hainan Agile and Hainan Yaheng have obtained the pre-sale permits for portion of the property and are entitled to pre-sell such portion of the property;
vi. as confirmed by the Company, the property is subject to various mortgages; and
vii. in respect of the mortgages, prior approval from the mortgagee has to be obtained within the mortgage period before Hainan Agile and Hainan Yaheng can transfer, let, mortgage or by other legal means to dispose of the property.

– III-12 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The following is the text of a report, received from the Company’s reporting accountant, PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, for the purpose of incorporation in this circular.

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ACCOUNTANT’S REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE DIRECTORS OF AGILE GROUP HOLDINGS LIMITED

Introduction

We report on the historical financial information of Crown Golden Investments Limited (‘‘Crown Golden’’) and its subsidiaries (together, ‘‘Crown Golden Group’’) set out on pages IV-4 to IV-61, which comprises the consolidated and company balance sheets as at 31 December 2014, 2015 and 2016, the consolidated income statements, the consolidated statements of comprehensive income, the consolidated statements of changes in equity and the consolidated statements of cash flows for each of the years then ended (the ‘‘Track Record Period’’) and a summary of significant accounting policies and other explanatory information (together, the ‘‘Historical Financial Information’’). The Historical Financial Information set out on pages IV-4 to IV-61 forms an integral part of this report, which has been prepared for inclusion in the circular of Agile Group Holdings Limited (the ‘‘Company’’) dated 26 June 2017 (the ‘‘Circular’’) in connection with the proposed repurchase of the 30% equity interest in Crown Golden.

Directors’ responsibility for the Historical Financial Information

The directors of Crown Golden are responsible for the preparation of Historical Financial Information that gives a true and fair view in accordance with the basis of presentation and preparation set out in Note 2.1 to the Historical Financial Information, and for such internal control as the directors determine is necessary to enable the preparation of Historical Financial Information that is free from material misstatement, whether due to fraud or error.

– IV-1 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The financial statements of Crown Golden Group for the Track Record Period (the ‘‘Underlying Financial Statements’’), on which the Historical Financial Information is based, were prepared by the directors of Crown Golden based on the previously issued financial statements of Crown Golden Group for the Track Record Period. The directors of Crown Golden are responsible for the preparation of the previously issued financial statements of Crown Golden Group that gives a true and fair view in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants (the ‘‘HKICPA’’), and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Reporting accountant’s responsibility

Our responsibility is to express an opinion on the Historical Financial Information and to report our opinion to you. We conducted our work in accordance with Hong Kong Standard on Investment Circular Reporting Engagements 200, Accountants’ Reports on Historical Financial Information in Investment Circulars issued by the HKICPA. This standard requires that we comply with ethical standards and plan and perform our work to obtain reasonable assurance about whether the Historical Financial Information is free from material misstatement.

Our work involved performing procedures to obtain evidence about the amounts and disclosures in the Historical Financial Information. The procedures selected depend on the reporting accountant’s judgement, including the assessment of risks of material misstatement of the Historical Financial Information, whether due to fraud or error. In making those risk assessments, the reporting accountant considers internal control relevant to the entity’s preparation of Historical Financial Information that gives a true and fair view in accordance with the basis of presentation and preparation set out in Note 2.1 to the Historical Financial Information in order to design procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Our work also included evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the Historical Financial Information.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion the Historical Financial Information gives, for the purposes of the accountant’s report, a true and fair view of the financial position of Crown Golden and the consolidated financial position of Crown Golden Group as at 31 December 2014, 2015 and 2016 and of its consolidated financial performance and its consolidated cash flows for the Track Record Period in accordance with the basis of presentation and preparation set out in Note 2.1 to the Historical Financial Information.

– IV-2 –

APPENDIX IV ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

REPORT ON MATTERS UNDER THE RULES GOVERNING THE LISTING OF SECURITIES ON THE STOCK EXCHANGE OF HONG KONG LIMITED

Adjustments

In preparing the Historical Financial Information, no adjustments to the Underlying Financial Statements have been made.

PricewaterhouseCoopers

Certified Public Accountants Hong Kong

26 June 2017

– IV-3 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

I. HISTORICAL FINANCIAL INFORMATION OF CROWN GOLDEN GROUP

Set out below is the Historical Financial Information which forms an integral part of this accountant’s report.

The Underlying Financial Statements, on which the Historical Financial Information is based, were audited by PricewaterhouseCoopers in accordance with Hong Kong Standards on Auditing issued by the HKICPA.

The Historical Financial Information is presented in RMB and all values are rounded to the nearest thousand (RMB’000) except when otherwise indicated.

Consolidated balance sheets

Note Assets Non-current assets Property, plant and equipment 6 Land use rights 7 Intangible assets 8 Investment properties 9 Properties under development 11 Deferred income tax assets 20 Current assets Properties under development 11 Completed properties held for sale 12 Prepayments for acquisition of land use rights 13 Trade and other receivables 14 Prepaid income taxes Restricted cash 15 Cash and cash equivalents 16 Total assets	As 2016 RMB’000 2,908,698 313,951 4,848 141,200 1,145,865 3,081 4,517,643 1,967,136 770,921 31,489 8,655,891 1,074,162 970,010 2,826,699 16,296,308 20,813,951	at 31 December 2015 2014 RMB’000 RMB’000 2,015,755 2,343,271 172,599 194,954 5,777 6,843 204,160 271,100 1,974,127 2,467,020 3,081 5,646 4,375,499 5,288,834 4,335,242 3,355,637 1,829,796 1,394,486 — — 9,085,888 11,894,432 1,050,769 548,598 171,301 228,811 2,402,361 2,203,236 18,875,357 19,625,200 23,250,856 24,914,034	at 31 December 2015 2014 RMB’000 RMB’000 2,015,755 2,343,271 172,599 194,954 5,777 6,843 204,160 271,100 1,974,127 2,467,020 3,081 5,646 4,375,499 5,288,834 4,335,242 3,355,637 1,829,796 1,394,486 — — 9,085,888 11,894,432 1,050,769 548,598 171,301 228,811 2,402,361 2,203,236 18,875,357 19,625,200 23,250,856 24,914,034
			5,288,834
			3,355,637 1,394,486 — 11,894,432 548,598 228,811 2,203,236
			19,625,200
			24,914,034

– IV-4 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Note Equity Capital and reserves attributable to the shareholders of Crown Golden Share capital and premium 17 Other reserves 18 Retained earnings Total equity Liabilities Non-current liabilities Borrowings 19 Deferred income tax liabilities 20 Current liabilities Borrowings 19 Trade and other payables 21 Advanced proceeds received from customers Current income tax liabilities Total liabilities Total equity and liabilities	As 2016 RMB’000 2,599,611 767,184 3,509,821 6,876,616 520,000 32,020 552,020 369,999 8,858,047 603,793 3,553,476 13,385,315 13,937,335 20,813,951	at 31 December 2015 2014 RMB’000 RMB’000 2,927,361 2,927,361 766,542 635,084 3,113,406 3,463,338 6,807,309 7,025,783 1,278,396 775,071 42,603 54,071 1,320,999 829,142 725,200 671,577 8,569,789 9,072,371 739,689 1,396,096 5,087,870 5,919,065 15,122,548 17,059,109 16,443,547 17,888,251 23,250,856 24,914,034	at 31 December 2015 2014 RMB’000 RMB’000 2,927,361 2,927,361 766,542 635,084 3,113,406 3,463,338 6,807,309 7,025,783 1,278,396 775,071 42,603 54,071 1,320,999 829,142 725,200 671,577 8,569,789 9,072,371 739,689 1,396,096 5,087,870 5,919,065 15,122,548 17,059,109 16,443,547 17,888,251 23,250,856 24,914,034
			7,025,783
			775,071 54,071
			829,142
			671,577 9,072,371 1,396,096 5,919,065
			17,059,109
			17,888,251
			24,914,034

– IV-5 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Balance sheets

Note Assets Non-current assets Investments in subsidiaries 36 Current assets Amounts due from subsidiaries Amounts due from related parties Cash and cash equivalents Total assets Equity Capital and reserve attributable to shareholders of Crown Golden Share capital and premium Retained earnings Total equity Liabilities Current liabilities Amounts due to subsidiaries Amount due to a related party Total liabilities Total equity and liabilities	As 2016 RMB’000 — 5,055,056 1,986,183 264 7,041,503 7,041,503 2,599,611 174,721 2,774,332 1,411,993 2,855,178 4,267,171 4,267,171 7,041,503	at 31 December 2015 2014 RMB’000 RMB’000 — — 4,805,381 6,233,818 1,879,245 1,787,670 247 233 6,684,873 8,021,721 6,684,873 8,021,721 2,927,361 2,927,361 75,238 17,110 3,002,599 2,944,471 1,176,659 1,524,577 2,505,615 3,552,673 3,682,274 5,077,250 3,682,274 5,077,250 6,684,873 8,021,721	at 31 December 2015 2014 RMB’000 RMB’000 — — 4,805,381 6,233,818 1,879,245 1,787,670 247 233 6,684,873 8,021,721 6,684,873 8,021,721 2,927,361 2,927,361 75,238 17,110 3,002,599 2,944,471 1,176,659 1,524,577 2,505,615 3,552,673 3,682,274 5,077,250 3,682,274 5,077,250 6,684,873 8,021,721
			6,233,818 1,787,670 233
			8,021,721
			8,021,721
			2,927,361 17,110
			2,944,471
			1,524,577 3,552,673
			5,077,250
			5,077,250
			8,021,721

– IV-6 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Consolidated income statements

Note
Revenue
5
Cost of sales
Gross profit
Selling and marketing costs
Administrative expenses
Fair value losses on investment
properties
Other (losses)/gains, net
22
Other income
23
Other expenses
24
Operating profit
Finance costs, net
27
Profit before income tax
Income tax expenses
28
Profit for the year
Profit attributable to:
Shareholders of Crown Golden

Year ended 31 December
2016
2015
2014
RMB’000
RMB’000
RMB’000
8,211,458
6,960,619
6,326,282
(5,745,497)
(3,737,362)
(3,100,555)
2,465,961
3,223,257
3,225,727
(656,280)
(320,797)
(420,353)
(258,905)
(266,644)
(235,279)
(2,439)
(21,940)
(25,854)
(303,663)
186,587
191
41,984
28,485
52,372
(34,353)
(3,995)
(13,687)
1,252,305
2,824,953
2,583,117
(30,504)
(41,284)
(54,568)
1,221,801
2,783,669
2,528,549
(643,623)
(1,539,519)
(1,498,364)
578,178
1,244,150
1,030,185
578,178
1,244,150
1,030,185

– IV-7 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Consolidated statements of comprehensive income

Profit for the year Other comprehensive income for the year, net of tax Total comprehensive income for the year Attributable to: — Shareholders of Crown Golden	Year ended 31 December 2016 2015 2014 RMB’000 RMB’000 RMB’000 578,178 1,244,150 1,030,185 — — — 578,178 1,244,150 1,030,185 578,178 1,244,150 1,030,185	Year ended 31 December 2016 2015 2014 RMB’000 RMB’000 RMB’000 578,178 1,244,150 1,030,185 — — — 578,178 1,244,150 1,030,185 578,178 1,244,150 1,030,185
		1,030,185
		1,030,185

– IV-8 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Consolidated statements of changes in equity

Balance at 1 January 2014
Comprehensive income
Profit for the year
Total comprehensive income
Total transactions with shareholders,
recognised directly in equity
Transfer to statutory reserve and enterprise expansion
funds
Dividends (note 29)
Total transactions with shareholders, recognised
directly in equity
Balance at 31 December 2014
Balance at 1 January 2015
Comprehensive income
Profit for the year
Total comprehensive income
Total transactions with shareholders,
recognised directly in equity
Transfer to statutory reserve and enterprise expansion
funds
Dividends (note 29)
Total transactions with shareholders, recognised
directly in equity
Balance at 31 December 2015
Balance at 1 January 2016
Comprehensive income
Profit for the year
Total comprehensive income
Total transactions with shareholders,
recognised directly in equity
Transfer to statutory reserve and enterprise expansion
funds
Dividends (note 29)
Total transactions with shareholders, recognised
directly in equity
Balance at 31 December 2016

Attributable to shareholders of Crown Golden
Share capital
and premium
Other reserves
Retained
earnings
Total
(note 17)
(note 18)
RMB’000
RMB’000
RMB’000
RMB’000
2,927,361
363,124
3,847,166
7,137,651
—
—
1,030,185
1,030,185
—
—
1,030,185
1,030,185
—
271,960
(271,960)
—
—
—
(1,142,053)
(1,142,053)
—
271,960
(1,414,013)
(1,142,053)
2,927,361
635,084
3,463,338
7,025,783
2,927,361
635,084
3,463,338
7,025,783
—
—
1,244,150
1,244,150
—
—
1,244,150
1,244,150
—
131,458
(131,458)
—
—
—
(1,462,624)
(1,462,624)
—
131,458
(1,594,082)
(1,462,624)
2,927,361
766,542
3,113,406
6,807,309
2,927,361
766,542
3,113,406
6,807,309
—
—
578,178
578,178
—
—
578,178
578,178
—
642
(642)
—
(327,750)
—
(181,121)
(508,871)
(327,750)
642
(181,763)
(508,871)
2,599,611
767,184
3,509,821
6,876,616

– IV-9 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Consolidated statements of cash flows

Note
Cash flows from operating activities
Cash generated from operations
30
Interest paid
PRC income tax paid
Net cash generated from/(used in)
operating activities
Cash flows from investing activities
Prepayment of land use rights for
development of own used properties
Purchases of property, plant and
equipment
Purchases of intangible assets
Proceeds received from disposal of
investment properties, property,
plant and equipment and land use
rights
Repayment of cash advances from
related parties
Cash advances made to related parties
Interest received
Net cash (used in)/generated from
investing activities

Year ended 31 December
2016
2015
2014
RMB’000
RMB’000
RMB’000
3,704,983
2,339,844
2,080,444
(88,357)
(119,369)
(100,410)
(2,211,993)
(2,881,788)
(1,571,572)
1,404,633
(661,313)
408,462
(50,992)
—
—
(27,423)
(96,388)
(333,742)
(142)
(15)
(2,846)
19,329
338,841
124
377,734
3,146,322
5,186
(428,243)
(195,619)
(909,806)
32,919
26,887
46,250
(76,818)
3,220,028
(1,194,834)

– IV-10 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Note
Cash flows from financing activities
Net proceeds from bank and other
borrowings
Repayment of bank borrowings
Cash advances from related parties
Repayment of cash advances to related
parties
Dividends paid to shareholders of
Crown Golden
Net cash (used in)/generated from
financing activities
Increase/(decrease) in cash and cash
equivalents
Cash and cash equivalents at
beginning of the year
Exchange gains on cash and cash
equivalents
Cash and cash equivalents at end of the
year
16

Year ended 31 December
2016
2015
2014
RMB’000
RMB’000
RMB’000
124,023
1,268,286
439,940
(1,237,620)
(711,338)
(209,983)
368,833
62,335
457,085
—
(470,728)
(27,513)
(159,308)
(2,509,682)
(342,616)
(904,072)
(2,361,127)
316,913
423,743
197,588
(469,459)
2,402,361
2,203,236
2,672,504
595
1,537
191
2,826,699
2,402,361
2,203,236

– IV-11 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

II. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1 GENERAL INFORMATION

Crown Golden Investments Limited (‘‘Crown Golden’’) is a limited liability company incorporated in the British Virgin Islands (the ‘‘BVI’’) on 15 February 2007 and is principally engaged in investment holding. The address of its registered office is P.O. Box 957, Vistra Corporate Services Centre, Wickhams Cay II, Road Town, Tortola, British Virgin Islands. Crown Golden and its subsidiaries (‘‘Crown Golden Group’’) are principally engaged in property development in Hainan Province, the People’s Republic of China (the ‘‘PRC’’).

Crown Golden is an indirect non-wholly owned subsidiary of Agile Group Holdings Limited, whose shares were listed on The Stock Exchange of Hong Kong Limited (the ‘‘Stock Exchange’’) on 15 December 2005.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation

The consolidated financial statements of Crown Golden Group have been prepared in accordance with all applicable Hong Kong Financial Reporting Standards (the ‘‘HKFRS’’). The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of investment properties, which are carried at fair value.

The preparation of financial statements in conformity with the HKFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying Crown Golden Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in note 4.

New standards and amendments to standards have been issued but are not yet effective and have not been early adopted:

	Effective for accounting
	period beginning on or after
Amendments to HKAS 12 ‘‘Income Taxes’’	1 January 2017
Amendments to HKAS 7 ‘‘ Statement of Cash Flows’’	1 January 2017
HKFRS 15 ‘‘Revenue from Contracts with Customers’’	1 January 2018
HKFRS 9 ‘‘Financial Instruments’’	1 January 2018
HKFRS 16 ‘‘Leases’’	1 January 2019
Amendments to HKFRS 10 and HKAS 28 ‘‘Sale or Contribution of	To be determined
Assets between an Investor and its Associate or Joint Venture’’

Crown Golden Group has already commenced an assessment of the impact of these new or revised standards, interpretation and amendments, certain of which are relevant to Crown Golden Group’s operations.

The amendments to HKAS 7 introduce an additional disclosure that will enable users of financial statements to evaluate changes in liabilities arising from financing activities.

– IV-12 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The amendments to HKAS 12 on the recognition of deferred tax assets for unrealised losses clarify how to account for deferred tax assets related to debt instruments measured at fair value.

HKFRS 15 will replace HKAS 18 which covers contracts for goods and services and HKAS 11 which covers construction contracts. The new standard is based on the principle that revenue is recognised when control of a good or service transfers to a customer. The standard permits either a full retrospective or a modified retrospective approach for the adoption.

Management is currently assessing the effects of applying the new standard on Crown Golden Group’s financial statements and has identified the following areas that are likely to be affected:

. revenue from service — the application of HKFRS 15 may result in the identification of separate performance obligations which could affect the timing of the recognition of revenue;
. accounting for certain costs incurred in fulfilling a contract — certain costs which are currently expensed may need to be recognised as an asset under HKFRS 15; and
. rights of return HKFRS 15 requires separate presentation on the balance sheet of the right to recover the goods from the customer and the refund obligation.

HKFRS 15 is mandatory for financial years commencing on or after 1 January 2018. At this stage, Crown Golden Group does not intend to adopt the standard before its effective date.

HKFRS 9 addresses the classification, measurement and derecognition of financial assets and financial liabilities, introduces new rules for hedge accounting and a new impairment model for financial assets.

There will be no impact on Crown Golden Group’s accounting for financial liabilities, as the new requirements only affect the accounting for financial liabilities that are designated at fair value through profit or loss and Crown Golden Group does not have any such liabilities. The derecognition rules have been transferred from HKAS 39 Financial Instruments: Recognition and Measurement and have not been changed.

The new hedge accounting rules will align the accounting for hedging instruments more closely with Crown Golden Group’s risk management practices.

The new impairment model requires the recognition of impairment provisions based on expected credit losses (ECL) rather than only incurred credit losses as is the case under HKAS 39. It applies to financial assets classified at amortised cost, debt instruments measured at FVOCI, contract assets under HKFRS 15 Revenue from Contracts with Customers, lease receivables, loan commitments and certain financial guarantee contracts. While Crown Golden Group has not yet undertaken a detailed assessment of how its impairment provisions would be affected by the new model, it may result in an earlier recognition of credit losses.

The new standard also introduces expanded disclosure requirements and changes in presentation. These are expected to change the nature and extent of Crown Golden Group’s disclosures about its financial instruments particularly in the year of the adoption of the new standard.

HKFRS 9 must be applied for financial years commencing on or after 1 January 2018. Based on the transitional provisions in the completed HKFRS 9, early adoption in phases was only permitted for annual reporting periods beginning before 1 February 2015. After that date, the new rules must be adopted in their entirety. Crown Golden Group does not intend to adopt HKFRS 9 before its mandatory date.

– IV-13 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The amendments to HKFRS 10 and HKAS 28 address an inconsistency between HKFRS 10 and HKAS 28 in the sale and contribution of assets between an investor and its associate or joint venture. A full gain or loss is recognised when a transaction involves a business. A partial gain or loss is recognised when a transaction involves assets that do not constitute a business, even if those assets are in a subsidiary. The amendments were originally intended to be effective for annual periods beginning on or after 1 January 2016. The effective date has now been deferred/removed. Early application of the amendments continues to be permitted.

HKFRS 16 will result in almost all leases being recognised on the balance sheet, as the distinction between operating and finance leases is removed. Under the new standard, an asset (the right to use the leased item) and a financial liability to pay rentals are recognised. The only exceptions are short-term and low-value leases.

The accounting for lessors will not significantly change.

The standard will affect primarily the accounting for Crown Golden Group’s operating leases. Management expects there will be no significant impact on Crown Golden Group’s financial statements when it becomes effective as Crown Golden Group does not have material lease arrangements as lessee.

Some of the commitments may be covered by the exception for short-term and low value leases and some commitments may relate to arrangements that will not qualify as leases under HKFRS 16.

The new standard is mandatory for financial years commencing on or after 1 January 2019. At this stage, Crown Golden Group does not intend to adopt the standard before its effective date.

2.2 Subsidiaries

2.2.1 Consolidation

A subsidiary is an entity (including a structured entity) over which Crown Golden Group has control. Crown Golden Group controls an entity when Crown Golden Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are consolidated from the date on which control is transferred to Crown Golden Group. They are deconsolidated from the date that control ceases.

2.2.2 Separate financial statements

Investments in subsidiaries are accounted for at cost less impairment. Cost includes direct attributable costs of investment. The results of subsidiaries are accounted for by Crown Golden on the basis of dividend received and receivable.

Impairment testing of the investments in subsidiaries is required upon receiving a dividend from these investments if the dividend exceeds the total comprehensive income of the subsidiary in the period the dividend is declared or if the carrying amount of the investment in the separate financial statements exceeds the carrying amount in the consolidated financial statements of the investee’s net assets including goodwill.

2.3 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the executive directors of Crown Golden that makes strategic decisions of Crown Golden Group.

– IV-14 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.4 Foreign currency translation

(a) Functional and presentation currency

Items included in the financial statements of each of Crown Golden Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘‘the functional currency’’). The consolidated financial statements are presented in Renminbi (‘‘RMB’’), which is Crown Golden’s functional and Crown Golden Group’s presentation currency.

(b) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the consolidated income statement, except when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.

Foreign exchange gains and losses that relate to borrowings denominated in foreign currencies are presented in the consolidated income statement within ‘‘finance costs, net’’. All other foreign exchange gains and losses are presented in the consolidated income statement within ‘‘other (losses)/ gains, net’’.

Changes in the fair value of debt securities denominated in foreign currency classified as available for sale are analysed between translation differences resulting from changes in the amortised cost of the security and other changes in the carrying amount of the security. Translation differences related to changes in amortised cost are recognised in profit or loss, and other changes in carrying amount are recognised in other comprehensive income.

Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non-monetary financial assets, such as equities classified as available for sale, are included in other comprehensive income.

2.5 Property, plant and equipment

Property, plant and equipment are stated at historical cost less depreciation and any impairment loss. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to Crown Golden Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the consolidated income statement during the financial period in which they are incurred.

When there is a change of use from an investment property to an owner-occupied property, the property’s deemed cost for subsequent accounting shall be its fair value at the date of change in use.

– IV-15 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Depreciation on property, plant and equipment is calculated using the straight-line method to allocate their cost to their residual values over their estimated useful lives, as follows:

Buildings	20–30 years
Hotel decorations	10 years
Office equipment	5–8 years
Transportation equipment	5–10 years
Machinery	5–10 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount (note 2.9).

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised within ‘‘other (losses)/gains, net’’ in the consolidated income statement.

2.6 Construction in progress

Construction in progress represents property under construction and is stated at cost less accumulated impairment loss, if any. Cost includes the costs of construction of buildings and interest charges arising from borrowings used to finance these assets during the period of construction, if any. No provision for depreciation is made on construction in progress until such times as the relevant assets are completed and are available for intended use. When the assets concerned are brought into use, the costs are transferred to property, plant and equipment and depreciated in accordance with the policy as stated in the preceding paragraphs.

2.7 Investment property

Investment property, principally comprising land use rights and buildings, is held for long-term rental yields or for capital appreciation or both, and that is not occupied by Crown Golden Group. It also includes properties that are being constructed or developed for future use as investment properties. Land held under operating leases are accounted for as investment properties when the rest of the definition of an investment property is met. In such cases, the operating leases concerned are accounted for as if they were finance leases. Investment properties are initially measured at cost, including related transaction costs and where applicable borrowing costs. After initial recognition, investment properties are carried at fair value, representing open market value determined at each reporting date by external valuers. Fair value is based on active market prices, adjusted, if necessary, for any difference in the nature, location or condition of the specific asset. If the information is not available, Crown Golden Group uses alternative valuation methods such as recent prices on less active markets or discounted cash flow projections. Changes in fair values are recorded as ‘‘Fair value gains on investment properties’’ in the consolidated income statement.

When an owner-occupied property becomes an investment property carried at fair value, Crown Golden Group applies HKAS 16 up to the date of change in use. Crown Golden Group treats any difference at that date between the carrying amount of the property in accordance with HKAS 16 and its fair value in the same way as a revaluation in accordance with HKAS 16. In other words, any resulting increase in the carrying amount is treated as follows:

(i) to the extent that the increase reverses a previous impairment loss for that property, the increase is recognised in profit or loss.
(ii) any remaining part of the increase is recognised in other comprehensive income and increases the revaluation surplus within equity.

– IV-16 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.8 Intangible assets

Computer software

Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. These costs are amortised over their estimated useful lives (2 to 10 years).

2.9 Impairment of non-financial assets

Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating unit). Non-financial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.

2.10 Financial assets

2.10.1 Classification

Crown Golden Group classifies its financial assets in the following categories: loans and receivables. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for the amounts that are settled or expected to be settled more than 12 months after the end of the reporting period. These are classified as non-current assets. Crown Golden Group’s loans and receivables comprise ‘‘trade and other receivables’’ and ‘‘cash and cash equivalents’’ in the consolidated balance sheet (notes 2.14 and 2.15).

2.10.2 Recognition and measurement

Regular way purchases and sales of financial assets are recognised on the trade-date — the date on which Crown Golden Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and Crown Golden Group has transferred substantially all risks and rewards of ownership. Loans and receivables are subsequently carried at amortised cost using the effective interest method.

2.11 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy of Crown Golden or the counterparty.

– IV-17 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.12 Impairment of financial assets

Assets carried at amortised cost

Crown Golden Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or a group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘‘loss event’’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or Crown Golden Group of financial assets that can be reliably estimated.

Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation, and where observable data indicate that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

The amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the consolidated income statement.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in the consolidated income statement.

2.13 Properties under development and held for sale

Properties under development and held for sale are stated at the lower of cost and net realisable value. Development cost of properties comprises cost of land use rights, construction costs and borrowing costs incurred during the construction period. Upon completion, the properties are transferred to completed properties held for sale.

Net realisable value takes into account the price ultimately expected to be realised, less applicable variable selling expenses and the anticipated costs to completion.

Properties under development and held for sale are classified as current assets unless the construction period of the relevant property development project is expected to complete beyond normal operating cycle.

2.14 Trade and other receivables

Trade receivables are amounts due from customers for properties sold or services performed in the ordinary course of business. If collection of trade and other receivables is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets.

Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less allowance for impairment.

– IV-18 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.15 Cash and cash equivalents

In the consolidated statement of cash flows, cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less.

2.16 Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

2.17 Trade and other payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade and other payables are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

2.18 Borrowings

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the consolidated income statement over the period of the borrowings using the effective interest method.

Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.

Borrowings are classified as current liabilities unless Crown Golden Group has an unconditional right to defer settlement of the liability for at least 12 months after the end of the reporting period.

2.19 Borrowing costs

General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in the consolidated income statement in the period in which they are incurred.

– IV-19 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.20 Current and deferred income tax

The tax expense for the period comprises current and deferred income tax and land appreciation tax. Tax is recognised in the consolidated income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

(a) Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where Crown Golden, its subsidiaries, associates and joint ventures operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

(b) Deferred income tax

Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred income tax liabilities are provided on taxable temporary differences arising from investments in subsidiaries, except for deferred income tax liability where the timing of the reversal of the temporary difference is controlled by Crown Golden Group and it is probable that the temporary difference will not reverse in the foreseeable future. Generally Crown Golden Group is unable to control the reversal of the temporary difference for associates. Only when there is an agreement in place that gives Crown Golden Group the ability to control the reversal of the temporary difference in the foreseeable future, deferred tax liability in relation to taxable temporary differences arising from the associate’s undistributed profits is not recognised.

Deferred income tax assets are recognised on deductible temporary differences arising from investments in subsidiaries only to the extent that it is probable the temporary difference will reverse in the future and there is sufficient taxable profit available against which the temporary difference can be utilised.

(c) Offsetting

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

– IV-20 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.21 Employee benefits

(a) Pension obligations

Crown Golden Group only operate defined contribution pension plans. In accordance with the rules and regulations in the PRC, the PRC based employees of Crown Golden Group participate in various defined contribution retirement benefit plans organised by the relevant municipal and provincial governments in the PRC under which Crown Golden Group and the PRC based employees are required to make monthly contributions to these plans calculated as a percentage of the employees’ salaries. The municipal and provincial governments undertake to assume the retirement benefit obligations of all existing and future retired PRC based employees’ payable under the plans described above. Other than the monthly contributions, Crown Golden Group has no further obligation for the payment of retirement and other post-retirement benefits of its employees. The assets of these plans are held separately from those of Crown Golden Group in independently administrated funds managed by the governments.

Crown Golden Group’s contributions to the defined contribution retirement scheme are expensed as incurred.

(b) Employee leave entitlements

Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the balance sheet date.

Employee entitlements to sick leave and maternity leave are not recognised until the time of leave.

2.22 Provisions

Provisions are recognised when: Crown Golden Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Restructuring provisions comprise lease termination penalties and employee termination payments. Provisions are not recognised for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense.

– IV-21 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.23 Revenue recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of properties and services in the ordinary course of Crown Golden Group’s activities. Revenue is shown net of discount and after eliminating revenue made with Crown Golden Group companies.

Crown Golden Group recognises revenue when the amount of revenue can be reliably measured; when it is probable that future economic benefits will flow to the entity; and when specific criteria have been met for each of Crown Golden Group’s activities as described below. Crown Golden Group bases its estimates of returns on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.

(a) Sales of properties

Revenue from sales of properties is recognised when Crown Golden Group has delivered the relevant properties to the purchaser and collectability of related consideration is reasonably assured. Deposits and installments received on properties sold prior to the date of revenue recognition are included in the consolidated balance sheets under current liabilities.

(b) Property management

Revenue arising from property management is recognised in the accounting period in which the services are rendered.

(c) Hotel operations

Hotel revenue from room rentals, food and beverage sales and other ancillary services are recognised when the goods are delivered or services are rendered.

(d) Rental income

Rental income from investment properties is recognised in the consolidated income statement on a straight-line basis over the term of lease.

(e) Interest income

Interest income is recognised using the effective interest method. When a loan and receivable is impaired, Crown Golden Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans and receivables is recognised using the original effective interest rate.

(f) Dividend income

Dividend income is recognised when the right to receive payment is established.

– IV-22 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

2.24 Leases

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases.

(i) Crown Golden Group is the lessee other than operating lease of land use rights

Payments made under operating leases (net of any incentives received from the lessor) are charged to the consolidated income statement on a straight-line basis over the period of the lease.

(ii) Crown Golden Group is the lessee under operating lease of land use rights

Land use rights under operating lease, which mainly comprise land use rights to be developed for hotel properties and own used buildings, are stated at cost and subsequently amortised in the consolidated income statement on a straight-line basis over the operating lease periods.

(iii) Crown Golden Group is the lessor

Assets leased out under operating leases are included in investment properties in the consolidated balance sheet.

2.25 Dividend distribution

Dividend distribution to Crown Golden’s shareholders is recognised as a liability in Crown Golden Group’s and Crown Golden’s financial statements in the period in which the dividends are approved by Crown Golden’s shareholders or directors, where appropriate.

2.26 Insurance contracts

An insurance contract is a contract under which one party (the insurer) accepts significant insurance risk from another party (the policyholder) by agreeing to compensate the policyholder if a specified uncertain future event (the insured event) adversely affects the policyholder. Insurance risk is a preexisting risk transferred from the policyholder to the insurer, and is significant only if an insured event could cause an insurer to pay significant additional benefits in any scenario, excluding scenarios that lack commercial substance (i.e. have no discernible effect on the economics of the transaction).

Crown Golden Group assesses at each reporting date whether its recognised insurance liabilities are adequate, using current estimates of future cash flows under its insurance contracts. If that assessment shows that the carrying amount of its insurance liabilities is inadequate in the light of the estimated future cash flows, the entire deficiency is recognised in the consolidated income statement.

Crown Golden Group regards its financial guarantee contracts provided in respect of mortgage facilities for certain property purchasers as insurance contracts.

– IV-23 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

3 FINANCIAL RISK MANAGEMENT

3.1 Financial risk factors

Crown Golden Group’s activities expose it to a variety of financial risks: market risk (including currency risk and interest rate risk), credit risk and liquidity risk. Crown Golden Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on Crown Golden Group’s financial performance. The property industry is highly sensitive to the economic environment in the PRC. Crown Golden Group finances its operations from shareholders’ fund, sales of properties, bank borrowings. Crown Golden Group has alternative plans to monitor liquidity risk should there be significant adverse changes on Crown Golden Group’s cash flow projections.

(i) Currency risk

Crown Golden Group’s businesses are principally conducted in RMB, except that certain receipts of proceeds from sales of properties, fees of property management services are in other currencies. As at 31 December 2016, 2015 and 2014, major non-RMB assets cash and cash equivalents denominated in HK dollar (‘‘HK$’’), US dollar (‘‘US$’’) or Singapore dollar (‘‘SGD’’). Fluctuation of the exchange rates of RMB against foreign currencies could affect Crown Golden Group’s results of operations.

The carrying amounts of Crown Golden Group’s foreign currency denominated monetary assets and liabilities at the respective balance sheet dates are as follows:

Monetary assets — HK$ — US$ Monetary liabilities — HK$ — US$ — SGD	Crown Golden Group 2016 2015 2014 RMB’000 RMB’000 RMB’000 1,702,910 1,579,940 1,488,321 1,496 1,126 1,126 1,704,406 1,581,066 1,489,447 2,514,109 2,176,848 2,682,986 485,673 455,291 243,024 8,405 8,034 2,058 3,008,187 2,640,173 2,928,068	Crown Golden Group 2016 2015 2014 RMB’000 RMB’000 RMB’000 1,702,910 1,579,940 1,488,321 1,496 1,126 1,126 1,704,406 1,581,066 1,489,447 2,514,109 2,176,848 2,682,986 485,673 455,291 243,024 8,405 8,034 2,058 3,008,187 2,640,173 2,928,068
		1,489,447
		2,682,986 243,024 2,058
		2,928,068

– IV-24 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The following table shows the sensitivity analysis of a 5% change in RMB against the relevant foreign currencies. The sensitivity analysis includes only foreign currency denominated monetary items and adjusts their translation at the year-end for a 5% change in foreign currency rates. If there is a 5% increase/decrease in RMB against the relevant currencies, the effect of increase/(decrease) in the profit for the year is as follows:

5% increase in RMB against HK$ 5% decrease in RMB against HK$ 5% increase in RMB against US$ 5% decrease in RMB against US$ 5% increase in RMB against SGD 5% decrease in RMB against SGD	Crown Golden Group 2016 2015 2014 RMB’000 RMB’000 RMB’000 40,255 29,547 59,424 (40,255) (29,547) (59,424) 24,358 22,837 12,223 (24,358) (22,837) (12,223) 315 301 77 (315) (301) (77)

(ii) Interest rate risk

Crown Golden Group’s exposure to changes in interest rates is mainly attributable to its borrowings. Borrowings at variable rates expose Crown Golden Group to cash flow interest-rate risk. Crown Golden Group closely monitors trend of interest rate and its impact on Crown Golden Group’s interest rate risk exposure. Crown Golden Group currently has not used any interest rate swap arrangements but will consider hedging interest rate risk should the need arise.

As at 31 December 2016, 2015 and 2014, if interest rates on borrowings had been 100 basis points higher or lower with all other variables held constant, interest charges for the years ended 31 December 2016, 2015 and 2014 would increase or decrease by RMB8,900,000, RMB20,036,000 and RMB14,466,000 respectively, mainly as a result of higher or lower interest expense on floating rate borrowings.

(iii) Credit risk

Crown Golden Group is exposed to credit risk in relation to its trade and other receivables and cash deposits with banks.

The carrying amounts of trade and other receivables, restricted cash, cash and cash equivalents represent Crown Golden Group’s maximum exposure to credit risk in relation to financial assets.

To manage this risk, deposits are mainly placed with licensing banks which are all high-creditquality financial institutions.

For credit exposures to customers, generally, Crown Golden Group requires full payment from customers before delivery of properties. Credit terms are granted to customers upon obtaining approval from Crown Golden’s senior management after assessing the credit history of those customers. Crown Golden Group closely monitors the collection of progress payments from customers in accordance with payment schedule agreed with customers. Crown Golden Group has policies in place to ensure that sales are made to purchasers with an appropriate financial strength and appropriate percentage of down payments.

– IV-25 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Meanwhile, Crown Golden Group has the right to cancel the contracts once repayment from the customers is in default; it also has monitoring procedures to ensure that follow-up actions are taken to recover overdue balances. In addition, Crown Golden Group regularly reviews the recoverable amount of each individual trade receivables to ensure that adequate impairment provisions are made for irrecoverable amounts. Crown Golden Group has no significant concentrations of credit risk, with exposure spread over a number of counterparties and customers.

Crown Golden Group typically provides guarantees to banks in connection with the customers’ borrowing of mortgage loans to finance their purchase of properties for an amount up to 80% of the total purchase price of the property. If a purchaser defaults on the payment of its mortgage loan during the guarantee period, the bank holding the guarantee may demand Crown Golden Group to repay the outstanding amount under the loan and any interest accrued thereon. Under such circumstances, Crown Golden Group is able to retain the customer’s deposit and re-sell the property to recover any amounts paid by Crown Golden Group to the bank. In this regard, the directors of Crown Golden consider that Crown Golden Group’s credit risk is significantly reduced. Detailed disclosure of these guarantees is made in the note 31.

No significant credit limits were exceeded during the reporting period, and management does not expect any significant losses from non-performance by these counterparties.

(iv) Liquidity risk

Management aims to maintain sufficient cash and cash equivalents or have available funding through an adequate amount of available financing, including proceeds from pre-sale of properties, committed credit facilities and short-term and long-term borrowings to meet its construction commitments.

Crown Golden Group has a number of alternative plans to mitigate the potential impacts on anticipated cash flows should there be significant adverse changes in economic environment. These include control on investment in land bank, adjusting project development timetable to adapt the changing local real estate market environment, implementing cost control measures, promotion of sales of completed properties, accelerating sales with more flexible pricing etc. Crown Golden Group will pursue such options basing on its assessment of relevant future costs and benefits.

– IV-26 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The table below analyses Crown Golden Group’s financial liabilities maturity profile at the balance sheet date. The amounts disclosed thereon are the contractual undiscounted cash flows. Balances due within 12 months from the balance sheet date equal to their carrying amounts in the balance sheets, as the impact of discount should not be significant.

Crown Golden Group At 31 December 2016 Borrowings Trade and other payables() At 31 December 2015 Borrowings Trade and other payables() At 31 December 2014 Borrowings Trade and other payables(*)	Less than 1 year RMB’000 409,423 8,725,560 844,415 8,420,831 774,922 8,963,242	Between 1 and 2 years RMB’000 243,967 — 77,017 — 200,281 —	Between 2 and 5 years RMB’000 344,896 — 834,427 — 45,445 —	Over 5 years RMB’000 — — 534,846 — 691,353 —	Total RMB’000 998,286 8,725,560
					2,290,705 8,420,831
					1,712,001 8,963,242

Excluding staff welfare benefit payable and other taxes payable.

3.2 Capital risk management

Crown Golden Group’s objectives of capital management are to safeguard Crown Golden Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the unnecessary cost of capital.

In order to maintain or adjust the capital structure, Crown Golden Group may adjust the amount of any returns to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

Crown Golden Group monitors its capital structure on a basis of gearing ratio. This ratio is calculated as net borrowings divided by total equity as shown in the consolidated balance sheet. Net borrowings are calculated as total borrowings (including current and non-current borrowings as shown in the consolidated balance sheet) less total of cash and cash equivalents and restricted cash.

Crown Golden Group is in the net cash position as at 31 December 2014, 2015 and 2016. The gearing ratio were keeping at a comparatively low level as Crown Golden Group’s business is very stable and Crown Golden Group has sufficient cash flow.

– IV-27 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

3.3 Fair value estimation

Crown Golden Group is not holding any financial assets and financial liabilities carried at fair value. The nominal value of financial assets and financial liabilities approximate their fair value as the impact of discounting is not significant.

The different levels of the financial instruments carried at fair value, by level of the inputs to valuation techniques used to measure fair value, have been defined as follows:

. Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1).
. Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2).
. Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).

4 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

4.1 Critical accounting estimates and assumptions

Crown Golden Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(i) Provisions for impairment of properties under development, completed properties held for sale and long-term assets held for hotel operations

Provision is made when events or changes in circumstances indicate that the carrying amounts may not be recoverable. For the purpose of assessing provision for impairment, properties under development, completed properties held for sale and long-term assets held by hotel segment are grouped at the lowest levels for which there are separately identifiable cash flows. The recoverability of the carrying amounts of land use rights for property development, properties under development and completed properties held for sale was assessed according to their recoverable amount, taking into account for costs to completion based on past experience and net sales value based on prevailing market conditions. The recoverable amounts of long-term assets held for hotel operation have been determined based on value-in-use calculations, taking into account latest market information and past experience. The assessment requires the use of judgement and estimates.

As at 31 December 2016, 2015 and 2014, no impairment was provided for properties under development, completed properties or long-term assets held for hotel operation.

– IV-28 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

(ii) Current and deferred income tax

Crown Golden Group is subject to corporate income taxes in the PRC. Judgement is required in determining the amount of the provision for taxation and the timing of payment of the related taxations. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

Deferred tax assets relating to certain temporary differences and tax losses are recognised when management considers to be probable that future taxable profit will be available against which the temporary differences or tax losses can be utilised. The outcome of their actual utilisation may be different.

(iii) Land appreciation taxes

PRC land appreciation tax is levied at progressive rates ranging from 30% to 60% on the appreciation of land value, being the proceeds of sales of properties less deductible expenditures including land cost, borrowing costs and all property development expenditures.

The subsidiaries of Crown Golden Group engaging in property development business in the PRC are subject to land appreciation taxes, which have been included in the income tax expenses. However, the implementation of these taxes varies amongst various PRC cities and Crown Golden Group has not finalised its land appreciation tax returns with various tax authorities for certain projects. Accordingly, judgement is required in determining the amount of land appreciation and its related taxes payable. Crown Golden Group recognises these liabilities based on management’s best estimates. Where the final tax outcome is different from the amounts that were initially recorded, such differences will impact the income tax expenses and provisions of land appreciation taxes in the period in which such determination is made.

(iv) Fair value of investment properties

The fair value of investment properties is determined by using valuation technique. Details of the judgement and assumptions have been disclosed in note 9.

(v) Recoverability of trade receivables

The management assesses the recoverability of trade receivables individually with reference to the past repayment history as well as subsequent settlement status. Allowances are applied to these receivables where events or changes in circumstances indicate that the balances may not be collectible and require the use of estimates. Where the expectation is different from the original estimate, such difference will impact the carrying amount of trade receivable and the impairment charge in the period in which such estimate has been changed.

As at 31 December 2016, 2015 and 2014, no impairment was provided for trade receivables.

– IV-29 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

5 SEGMENT INFORMATION

The executive directors of Crown Golden, which are the chief operating decision-makers of Crown Golden Group, review Crown Golden Group’s internal reporting in order to assess performance and allocate resources. Management has determined the operating segments based on reports reviewed by the executive directors of Crown Golden that are used to make strategy decision.

Crown Golden Group is organised into four business segments: property development, property management, hotel operations and property investment. As the executive directors of Crown Golden consider most of Crown Golden Group’s consolidated revenue and results are attributable from the market in the PRC. Most of the non-current assets are located in the PRC, and less than 10% of Crown Golden Group’s consolidated assets are located outside the PRC, geographical segment information is not considered necessary.

The executive directors of Crown Golden assess the performance of the operating segments based on a measure of segment results, being profit before income tax before deducting finance costs.

Crown Golden Group has a large number of customers, none of whom contributed 5% or more of Crown Golden Group’s revenue.

Analysis of revenue by the category for the years ended 31 December 2016, 2015 and 2014 is as follows:

Sales of developed properties Property management services Hotel operations Rental income from investment properties	2016 RMB’000 7,952,193 103,242 148,765 7,258 8,211,458	2015 RMB’000 6,724,311 84,976 148,681 2,651 6,960,619	2014 RMB’000 6,153,706 65,426 100,175 6,975
			6,326,282

– IV-30 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Segment information provided to the executive directors of Crown Golden for the reporting segments for the years ended 31 December 2016, 2015 and 2014 are as follows:

Year ended 31 December 2016

Property development RMB’000 7,952,193 —	Property management RMB’000 172,621 (69,379)	Hotel operations RMB’000 148,765 —	Crown Golden Group RMB’000 8,280,837 (69,379)
7,952,193	103,242	148,765	8,211,458
—	—	—	(2,439)
1,560,134 —	32,962 —	(112,940) (210,626)	1,462,931 (210,626)
1,560,134	32,962	(323,566)	1,252,305
53,505 4,700	807 30	111,244 976	(30,504)
			1,221,801 (643,623)
			578,178
			165,556 5,706
17,111,831	168,798	2,335,144	19,736,708 1,077,243
9,139,534	65,591	276,980
			20,813,951
			9,461,840 4,475,495
1,690	518	85,098
			13,937,335
			91,926

Segment assets and liabilities are reconciled to total assets and liabilities as at 31 December 2016 as follows:

Segment assets/liabilities Unallocated: Deferred income taxes Prepaid income taxes Current income tax liabilities Current borrowings Non-current borrowings Total	Assets RMB’000 19,736,708 3,081 1,074,162 — — — 20,813,951	Liabilities RMB’000 9,461,840 32,020 — 3,553,476 369,999 520,000
		13,937,335

– IV-31 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Year ended 31 December 2015

Gross segment sales Inter-segment sales Sales to external customers Fair value losses on investment properties (note 9) Operating result Gains on disposal of hotel assets Segment result Finance costs, net (note 27) Profit before income tax Income tax expenses (note 28) Profit for the year Depreciation Amortisation of land use rights and intangible assets Segment assets Unallocated assets Total assets Segment liabilities Unallocated liabilities Total liabilities Capital expenditure	Property development RMB’000 6,724,311 — 6,724,311 — 2,732,834 — 2,732,834 25,862 1,537 19,901,976 9,020,112 16,790	Property management RMB’000 162,266 (77,290) 84,976 — 16,618 — 16,618 906 30 117,609 55,220 291	Hotel operations RMB’000 148,681 —	Property investment Elimination RMB’000 RMB’000 2,651 — — — 2,651 — (21,940) — (18,010) — — — (18,010) — — — — — 204,160 (51,210) — (51,210) — —	Crown Golden Group RMB’000 7,037,909 (77,290)
			148,681		6,960,619
			—		(21,940)
			(117,115) 210,626		2,614,327 210,626
			93,511		2,824,953
			104,216 924		(41,284)
					2,783,669 (1,539,519)
					1,244,150
					130,984 2,491
			2,024,471		22,197,006
			285,356		1,053,850
					23,250,856
					9,309,478
			83,518		7,134,069
					16,443,547
					100,599

Segment assets and liabilities are reconciled to total assets and liabilities as at 31 December 2015 as follows:

Segment assets/liabilities Unallocated: Deferred income taxes Prepaid income taxes Current income tax liabilities Current borrowings Non-current borrowings Total	Assets RMB’000 22,197,006 3,081 1,050,769 — — — 23,250,856	Liabilities RMB’000 9,309,478 42,603 — 5,087,870 725,200 1,278,396
		16,443,547

– IV-32 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Year ended 31 December 2014

Gross segment sales Inter-segment sales Sales to external customers Fair value losses on investment properties (note 9) Segment result Finance costs, net (note 27) Profit before income tax Income tax expenses (note 28) Profit for the year Depreciation Amortisation of land use rights and intangible assets Segment assets Unallocated assets Total assets Segment liabilities Unallocated liabilities Total liabilities Capital expenditure	Property development RMB’000 6,153,706 — 6,153,706 — 2,695,740 8,380 2,231 21,966,729 10,142,680 92,670	Property management RMB’000 125,619 (60,193) 65,426 — 10,484 982 29 98,045 61,529 301	Hotel operations RMB’000 100,175 — 100,175 — (99,087) 81,514 813 2,040,026 280,368 247,923	Property investment Elimination RMB’000 RMB’000 6,975 — — — 6,975 — (25,854) — (24,020) — — — — — 271,100 (16,110) — (16,110) 19,254 —	Crown Golden Group RMB’000 6,386,475 (60,193
					6,326,282
					(25,854
					2,583,117
					(54,568
					2,528,549 (1,498,364
					1,030,185
					90,876 3,073
					24,359,790
					554,244
					24,914,034
					10,468,467
					7,419,784
					17,888,251
					360,148

Segment assets and liabilities are reconciled to total assets and liabilities as at 31 December 2014 as follows:

Segment assets/liabilities Unallocated: Deferred income taxes Prepaid income taxes Current income tax liabilities Current borrowings Non-current borrowings Total	Assets RMB’000 24,359,790 5,646 548,598 — — — 24,914,034	Liabilities RMB’000 10,468,467 54,071 — 5,919,065 671,577 775,071
		17,888,251

Inter-segment transfers or transactions are entered into at terms and conditions agreed upon by respective parties.

Eliminations comprise inter-segment trade and non-trade balances.

Pricing policy for inter-segment transactions is determined by reference to market price.

– IV-33 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Segment assets consist primarily of property, plant and equipment, land use rights, properties under development, completed properties held for sale, investment properties, receivables and cash balances. Unallocated assets comprise deferred tax assets and prepaid income taxes. Segment liabilities comprise operating liabilities. Unallocated liabilities comprise taxation and borrowings.

Capital expenditure comprises additions to property, plant and equipment, land use rights for self-owned properties, investment properties and intangible assets.

6 PROPERTY, PLANT AND EQUIPMENT

At 1 January 2014 Cost Accumulated depreciation Net book amount Year ended 31 December 2014 Opening net book amount Additions Transfer of completed construction projects Disposals Depreciation Closing net book amount At 31 December 2014 Cost Accumulated depreciation Net book amount Year ended 31 December 2015 Opening net book amount Additions Transfer of completed construction projects Disposals Depreciation Closing net book amount At 31 December 2015 Cost Accumulated depreciation Net book amount Year ended 31 December 2016 Opening net book amount Additions Reversal of disposal of hotel property Transfer from properties under development (note (b)) Disposals Depreciation Closing net book amount At 31 December 2016 Cost Accumulated depreciation Net book amount	Buildings RMB’000 1,374,624 (44,438) 1,330,186 1,330,186 45 235,708 — (79,169) 1,486,770 1,610,377 (123,607) 1,486,770 1,486,770 77 94,335 — (110,994) 1,470,188 1,704,789 (234,601) 1,470,188 1,470,188 361 — 731,080 — (152,483) 2,049,146 2,436,230 (387,084) 2,049,146	Transportation equipment RMB’000 30,381 (13,965) 16,416 16,416 3,682 — — (6,046) 14,052 34,043 (19,991) 14,052 14,052 1,853 — (526) (2,499) 12,880 32,432 (19,552) 12,880 12,880 564 — — (130) (4,731) 8,583 29,136 (20,553) 8,583	Office equipment RMB’000 26,801 (6,735) 20,066 20,066 13,155 — (111) (5,110) 28,000 39,550 (11,550) 28,000 28,000 1,911 — (157) (16,362) 13,392 41,203 (27,811) 13,392 13,392 219 — — (51) (5,357) 8,203 37,878 (29,675) 8,203	Machinery RMB’000 2,712 (1,000) 1,712 1,712 2,377 — (13) (551) 3,525 5,031 (1,506) 3,525 3,525 8,383 — — (1,129) 10,779 13,414 (2,635) 10,779 10,779 981 — — (178) (2,985) 8,597 13,291 (4,694) 8,597	Construction in progress RMB’000 727,843 — 727,843 727,843 318,789 (235,708) — — 810,924 810,924 — 810,924 810,924 107,824 (94,335) (315,897) — 508,516 508,516 — 508,516 508,516 29,220 296,433 — — — 834,169 834,169 — 834,169	Total RMB’000 2,162,361 (66,138)
						2,096,223
						2,096,223 338,048 — (124) (90,876)
						2,343,271
						2,499,925 (156,654)
						2,343,271
						2,343,271 120,048 — (316,580) (130,984)
						2,015,755
						2,300,354 (284,599)
						2,015,755
						2,015,755 31,345 296,433 731,080 (359) (165,556)
						2,908,698
						3,350,704 (442,006)
						2,908,698

– IV-34 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Depreciation expenses were charged to the following categories in the consolidated income statement:

Cost of sales Selling and marketing costs Administrative expenses	2016 RMB’000 126,105 13,158 26,293 165,556	2015 RMB’000 112,107 1,240 17,637 130,984	2014 RMB’000 74,779 950 15,147
			90,876

Notes:

(a) Buildings mainly represent the office buildings and hotel buildings. Constructions in progress mainly represent construction costs and other costs incurred for the construction of hotels.
(b) During the year ended 31 December 2016, certain own used properties with a carrying value of RMB731,080,000 were transferred from properties under development as a result of change in development plan. There was no reclassification between properties under development and property, plant and equipment during the years ended 31 December 2015 and 2014.

7 LAND USE RIGHTS

At 1 January Additions Reversal of disposal of hotel property Transfer from/(to) properties under development (note (b)) Disposal Amortisation — Capitalised in construction in progress — Recognised as cost of sales (note 25) — Recognised as expenses (note 25) At 31 December	2016 RMB’000 172,599 55,819 16,749 77,341 — (3,922) (976) (3,659) 313,951	2015 RMB’000 194,954 — — — (16,749) (4,196) (924) (486) 172,599	2014 RMB’000 212,728 — — (11,335) — (4,306) (813) (1,320)
			194,954

Notes:

(a) Land use rights comprise cost of acquiring usage rights of certain land, which are located in the PRC, held on leases of over 40 years, and mainly for hotel properties or self-used buildings over fixed periods.
(b) During the year ended 31 December 2016, certain own used land use rights with carrying value of RMB77,341,000 were transferred from properties under developments as a result of change in development plan. For the year ended 31 December 2014, certain own used land use rights with carrying value of RMB11,335,000 were transferred to properties under developments as a result of change in development plan.
(c) Land use rights of RMB32,183,000, RMB54,770,000 and RMB125,805,000 as at 31 December 2016, 2015 and 2014, respectively, were pledged as collateral for Crown Golden Group’s borrowings (note 19).

– IV-35 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

8 INTANGIBLE ASSETS

At 1 January 2014
Cost
Accumulated amortisation
Net book amount
Year ended 31 December 2014
Opening net book amount
Additions
Amortisation
Closing net book amount
At 1 January 2015
Cost
Accumulated amortisation
Net book amount
Year ended 31 December 2015
Opening net book amount
Additions
Amortisation
Closing net book amount
At 31 December 2015
Cost
Accumulated amortisation
Net book amount
Year ended 31 December 2016
Opening net book amount
Additions
Amortisation
Closing net book amount
At 31 December 2016
Cost
Accumulated amortisation
Net book amount

Computer
software
RMB’000
5,879
(942)
4,937
4,937
2,846
(940)
6,843
8,725
(1,882)
6,843
6,843
15
(1,081)
5,777
8,740
(2,963)
5,777
5,777
142
(1,071)
4,848
8,882
(4,034)
4,848

Amortisation of RMB1,071,000, RMB1,081,000 and RMB940,000 for the years ended 31 December 2016, 2015 and 2014, respectively, is included in the ‘‘administrative expenses’’ of the consolidated income statement.

– IV-36 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

9 INVESTMENT PROPERTIES

Opening net book amount Capitalised subsequent expenditure Disposals Revaluation losses recognised in consolidated income statement Closing net book amount	2016 RMB’000 204,160 4,620 (65,141) (2,439) 141,200	2015 RMB’000 271,100 — (45,000) (21,940) 204,160	2014 RMB’000 277,700 19,254 — (25,854) 271,100

Notes:

(a) The investment properties are located in the PRC and are held on lease of between 30 to 70 years.

(b) Amounts recognised in the consolidated income statement for investment properties:

Rental income Direct operating expenses of investment properties that generated rental income Direct operating expenses of investment properties that did not generate rental income	2016 RMB’000 7,258 (5,130) (827) 1,301	2015 RMB’000 2,651 (1,329) (336) 986	2014 RMB’000 6,975 (3,136) (2,005) 1,834

As at 31 December 2016, 2015 and 2014, Crown Golden Group had no unprovided contractual obligations for future repairs and maintenance.

(c) Fair value hierarchy

As at 31 December 2016, 2015 and 2014, all of Crown Golden Group’s investment properties were within level 3 of the fair value hierarchy as the valuation were arrived at by reference to certain significant unobservable inputs. There were no transfers between levels 1, 2 and 3 during the year.

(d) Valuation processes of Crown Golden Group

Crown Golden Group’s investment properties were valued at 31 December 2016, 2015 and 2014 by an independent professionally qualified valuer, Vigers Appraisal & Consulting Limited, who holds a recognised relevant professional qualification and has recent experience in the locations and segments of the investment properties valued. For all investment properties, their current use equates to the highest and best use.

Crown Golden Group’s finance department includes a team that reviews the valuations performed by the independent valuer for financial reporting purposes. This team reports directly to the executive directors. Discussion of valuation processes and results are held amongst the executive directors, the valuation team and the valuer at least once every six months.

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ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

At each financial year end, the finance department:

. Verifies all major inputs to the independent valuation report;
. Assesses property valuations movements when compared to the prior year valuation report; and
. Holds discussions with the independent valuer.

Changes in Level 2 and 3 fair values are analysed at each reporting date during the bi-annual valuation discussions between the executive directors and the valuation team. As part of this discussion, the team presents a report that explains the reasons for the fair value movements.

(e) Valuation techniques

Fair values of completed commercial properties are generally derived using the income capitalisation method. This valuation method is based on the capitalisation of the net income and reversionary income potential by adopting appropriate capitalisation rates, which are derived from analysis of sale transactions and valuers’ interpretation of prevailing investor requirements or expectations. The prevailing market rents adopted in the valuation have reference to valuers’ view of recent lettings, within the subject properties and other comparable properties.

			Fair value as at			Range of
			31 December			unobservable
	Description	Location	2016	Valuation techniques	Unobservable inputs	inputs
			RMB’000
Completed investment	Office and retail	PRC	141,200	Income capitalisation	Term yields	5.2%–7.0%
properties	shop
					Reversionary yields	5.8%–7.9%
					Market rents (RMB/	39–56
					square meter/month)
			Fair value as at			Range of
			31 December			unobservable
	Description	Location	2015	Valuation techniques	Unobservable inputs	inputs
			RMB’000
Completed investment	Office and retail	PRC	204,160	Income capitalisation	Term yields	5.2%–7.0%
properties	shop
					Reversionary yields	5.8%–7.9%
					Market rents (RMB/	36–52
					square meter/month)
			Fair value as at			Range of
			31 December			unobservable
	Description	Location	2014	Valuation techniques	Unobservable inputs	inputs
			RMB’000
Completed investment	Office and retail	PRC	271,100	Income capitalisation	Term yields	5.2%–7.0%
properties	shop
					Reversionary yields	5.8%–7.9%
					Market rents (RMB/	35–48
					square meter/month)

There are inter-relationships between unobservable inputs.

For office and retail shop, increase in term yields and revisionary yields may result in decrease of fair value. Increase in market rent may result in increase of fair value.

There are no changes to the valuation technique during the years ended 31 December 2016, 2015 and 2014.

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ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

(f) Leasing arrangements

Certain investment properties are leased to tenants under long term operating leases with rentals payable monthly. Minimum lease payments receivable on leases of investment properties are disclosed in note 33.

The period of leases whereby Crown Golden Group leases out its investment properties under operating leases ranged from 1 year to 15 years.

10 FINANCIAL INSTRUMENTS BY CATEGORY

Assets as per consolidated balance sheet

Loans and receivables Trade and other receivables excluding prepayments Restricted cash Cash and cash equivalents Total Liabilities as per consolidated balance sheet Other financial liabilities at amortised cost Borrowings Trade and other payables and accruals, excluding staff welfare benefit payable and other taxes payable Total	2016 RMB’000 8,632,646 970,010 2,826,699 12,429,355 2016 RMB’000 889,999 8,725,560 9,615,559	2015 RMB’000 9,036,005 171,301 2,402,361 11,609,667 2015 RMB’000 2,003,596 8,420,831 10,424,427	2014 RMB’000 11,868,858 228,811 2,203,236
			14,300,905
			2014 RMB’000 1,446,648 8,963,242
			10,409,890

– IV-39 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

11 PROPERTIES UNDER DEVELOPMENT

Properties under development expected to be completed: — Within one operating cycle included under current assets — Beyond one operating cycle included under non-current assets Properties under development comprise: — Construction costs and capitalised expenditures — Capitalised interests — Land use rights	2016 RMB’000 1,967,136 1,145,865 3,113,001 1,014,947 93,134 2,004,920 3,113,001	2015 RMB’000 4,335,242 1,974,127 6,309,369 3,800,829 139,527 2,369,013 6,309,369	2014 RMB’000 3,355,637 2,467,020
			5,822,657
			3,250,306 105,271 2,467,080
			5,822,657

All Crown Golden Group’s properties under development are located in the PRC. The relevant land use rights in the PRC are on leases of 40 to 70 years.

The capitalisation rate of borrowings is 5.73%, 6.88% and 6.93% for each of years ended 31 December 2016, 2015 and 2014, respectively.

Land use rights included in the properties under development with net book value of RMB226,884,000, RMB426,617,000 and RMB222,389,000 as at 31 December 2016, 2015 and 2014, respectively, were pledged as collateral for Crown Golden Group’s borrowings (note 19).

The amount of properties under development expected to be recovered after more than one year is RMB1,145,865,000, RMB2,813,824,000 and RMB4,078,886,000 as at 31 December 2016, 2015 and 2014. The remaining balance is expected to be recovered within one year.

12 COMPLETED PROPERTIES HELD FOR SALE

All completed properties held for sale are located in the PRC. The relevant land use rights are on leases of 40 to 70 years.

13 PREPAYMENTS FOR ACQUISITION OF LAND USE RIGHTS

Amounts represent up-front payments for acquisition of land use rights for property development which will be completed within one year. The amounts will be transferred to properties under development in the balance sheet when Crown Golden Group obtains certificate of land use rights of the relevant lands.

– IV-40 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

14 TRADE AND OTHER RECEIVABLES

Trade receivables (note (a)) Other receivables due from: — Third parties — Related parties (note 34(c)) Prepayments Total trade and other receivables	2016 RMB’000 698,406 147,502 7,786,738 23,245 8,655,891	2015 RMB’000 865,847 433,929 7,736,229 49,883 9,085,888	2014 RMB’000 1,048,940 132,986 10,686,932 25,574
			11,894,432

As at 31 December 2016, 2015 and 2014, the fair value of trade and other receivables approximated their carrying amounts. All the balances were fully performing except the balances which were past due but not impaired as described below.

Notes:

(a) Trade receivables mainly arose from sales of properties. Trade receivables in respect of sale of properties are settled in accordance with the terms stipulated in the sale and purchase agreements. As at 31 December 2016, 2015 and 2014, the ageing analysis of the trade receivables based on invoice date is as follows:

Within 90 days Over 90 days and within 365 days Over 365 days	2016 RMB’000 541,061 75,924 81,421 698,406	2015 RMB’000 294,678 401,320 169,849 865,847	2014 RMB’000 583,081 264,834 201,025
			1,048,940

Trade receivables of RMB86,323,000, RMB232,828,000 and RMB710,153,000 as at 31 December 2016, 2015 and 2014 respectively, were past due but not impaired. As Crown Golden Group normally holds collateral of the properties before collection of the outstanding balances and pass the titles to the purchasers, the Directors consider that the past due trade receivables would be recovered and no provision was made against past due receivables as at 31 December 2016, 2015 and 2014. The ageing analysis of these trade receivables is as follows:

Within 90 days Over 90 days and within 365 days Over 365 days	2016 RMB’000 13,957 1,371 70,995 86,323	2015 RMB’000 51,042 17,438 164,348 232,828	2014 RMB’000 303,586 315,974 90,593
			710,153

(b) The carrying amounts of trade and other receivables are mainly denominated in RMB.

– IV-41 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

15 RESTRICTED CASH

As at 31 December 2016, 2015 and 2014, all of Crown Golden Group’s restricted cash were denominated in RMB. The conversion of the PRC Group entities’ RMB denominated bank balances into foreign currencies and the remittance of such foreign currencies denominated bank balances and cash out of the PRC are subject to relevant rules and regulation of foreign exchange control promulgated by the PRC government.

As at 31 December 2016, 2015 and 2014, restricted cash is mainly comprised of guarantee deposits for construction of pre-sold properties.

16 CASH AND CASH EQUIVALENTS

Cash and cash equivalents comprise the following: Cash at bank and in hand Denominated in RMB (note (a)) Denominated in other currencies	2016 RMB’000 2,826,699 2,826,699 2,808,551 18,148 2,826,699	2015 RMB’000 2,402,361 2,402,361 2,400,451 1,910 2,402,361	2014 RMB’000 2,203,236
			2,203,236
			2,201,459 1,777
			2,203,236

Note

(a): The conversion of the PRC Group entities’ RMB denominated bank balances into foreign currencies and the remittance of such foreign currencies denominated bank balances and cash out of the PRC are subject to relevant rules and regulation of foreign exchange control promulgated by the PRC government.

– IV-42 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

17 SHARE CAPITAL AND PREMIUM

Authorised As at 31 December 2016, 2015 and 2014 Movements of issued and fully paid share capital Year ended 31 December 2014 At 1 January 2014 and 31 December 2014 Year ended 31 December 2015 At 1 January 2015 and 31 December 2015 Year ended 31 December 2016 At 1 January 2016 Dividends (Note 29) At 31 December 2016 18 OTHER RESERVES Balance at 1 January 2014 Transfer from retained earnings Balance at 31 December 2014 Balance at 1 January 2015 Transfer from retained earnings Balance at 31 December 2015 Balance at 1 January 2016 Transfer from retained earnings Balance at 31 December 2016	Number of ordinary shares 50,000 100 100 100 — 100	Nominal value of ordinary shares USD 50,000 100 100 100 — 100	Equivalent nominal value of ordinary shares RMB’000 1 1 1 — 1	Share premium Total RMB’000 RMB’000 2,927,360 2,927,361 2,927,360 2,927,361 2,927,360 2,927,361 (327,750) (327,750) 2,599,610 2,599,611 Statutory reserve and enterprise expansion fund (note (a)) RMB’000 363,124 271,960 635,084 635,084 131,458 766,542 766,542 642 767,184

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ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Note:

(a) Pursuant to the relevant rules and regulation concerning foreign investment enterprise established in the PRC and the articles of association of certain PRC subsidiaries of Crown Golden Group, those subsidiaries are required to transfer an amount of their profit after taxation to the statutory reserve fund, until the accumulated total of the fund reaches 50% of their registered capital. The statutory reserve fund may be distributed to equity holders in form of bonus issue.

The appropriation to the enterprise expansion fund is solely determined by the board of directors of the PRC subsidiaries.

19 BORROWINGS

Borrowings included in non-current liabilities: Long-term bank borrowings — secured (note (a)) Less: current portion of non-current borrowings Borrowings included in current liabilities: Current portion of non-current borrowings Total borrowings	2016 RMB’000 889,999 (369,999) 520,000 369,999 889,999	2015 RMB’000 2,003,596 (725,200) 1,278,396 725,200 2,003,596	2014 RMB’000 1,446,648 (671,577)
			775,071
			671,577
			1,446,648

Note:

(a) As at 31 December 2016, 2015 and 2014, Crown Golden Group’s borrowings were secured by its land use rights and properties under development.

The exposure of Crown Golden Group’s borrowings to interest rate changes and the contractual repricing dates at the end of the years are as follows:

6 months or less 6–12 months	2016 RMB’000 480,000 409,999 889,999	2015 RMB’000 934,668 1,068,928 2,003,596	2014 RMB’000 312,253 1,134,395
			1,446,648

– IV-44 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The carrying amounts of the borrowings with the respective effective interest rates:

Bank borrowings	2016 RMB’000 Effective interest rate 889,999 5.73%	As of 31 December 2015 RMB’000 Effective interest rate 2,003,596 6.88%	2014 RMB’000 Effective interest rate 1,446,648 6.93%

The carrying amounts and fair value of the non-current borrowings are as follows:

Bank borrowings (note (b))	2016 Carrying amount Fair value RMB’000 RMB’000 520,000 520,000	2015 Carrying amount Fair value RMB’000 RMB’000 1,278,396 1,278,396	2014 Carrying amount Fair value RMB’000 RMB’000 775,071 775,071

Note:

(b) The fair values of non-current bank borrowings approximate their carrying amount as the impact of discounting is not significant. The fair values are based on cash flows discounted at the average borrowing rate of 5.73%, 6.88% and 6.93% as at 31 December 2016, 2015 and 2014, and are within level 2 of the fair value hierarchy.

At 31 December 2016, 2015 and 2014, Crown Golden Group’s borrowings were repayable as follows:

Bank borrowings: Within 1 year Later than 1 year but not more than 2 years Later than 2 year but not more than 5 years Over 5 years	2016 RMB’000 369,999 220,000 300,000 — 889,999	2015 RMB’000 725,200 — 757,409 520,987 2,003,596	2014 RMB’000 671,577 144,330 — 630,741
			1,446,648

The carrying amounts of Crown Golden Group’s borrowings are denominated in the following currencies:

Renminbi	2016 RMB’000 889,999	2015 RMB’000 2,003,596	2014 RMB’000 1,446,648

– IV-45 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Crown Golden Group has the following undrawn borrowing facilities:

Expiring beyond one year	2016 RMB’000 880,001	2015 RMB’000 104,116	2014 RMB’000 945,821

20 DEFERRED INCOME TAX

The analysis of deferred income tax assets and deferred income tax liabilities is as follows:

Deferred income tax assets to be recovered after more than 12 months Deferred tax income liabilities to be settled after more than 12 months Deferred income tax liabilities, net	2016 RMB’000 3,081 (32,020) (28,939)	2015 RMB’000 3,081 (42,603) (39,522)	2014 RMB’000 5,646
			(54,071)
			(48,425)

The movement in deferred income tax assets and liabilities during the year, without taking into consideration the offsetting of balances within the same tax jurisdiction, is as follows:

At 1 January 2014 Credited to the consolidated income statement At 31 December 2014 At 1 January 2015 (Charged)/credited to the consolidated income statement At 31 December 2015 At 1 January 2016 Credited to the consolidated income statement At 31 December 2016	Deferred tax assets — tax losses RMB’000 — 5,646 5,646 5,646 (2,565) 3,081 3,081 — 3,081	Deferred tax liabilities — excess of carrying amount of investment properties over the tax bases RMB’000 (60,534) 6,463 (54,071) (54,071) 11,468 (42,603) (42,603) 10,583 (32,020)	Net RMB’000 (60,534) 12,109
			(48,425) (48,425) 8,903
			(39,522) (39,522) 10,583
			(28,939)

As at 31 December 2016, 2015 and 2014, deferred income tax liabilities of RMB287,589,000, RMB274,801,000 and RMB305,240,000, respectively, have not been recognised for the withholding tax that would be payable on the unremitted earnings amounted to RMB2,875,885,000, RMB2,748,006,000 and RMB3,052,396,000 of certain subsidiaries. Such earnings are expected to be retained by the PRC subsidiaries for reinvestment purposes and would not be remitted to the oversea intermediate holding companies in the foreseeable future based on management’s estimation of overseas funding requirements.

– IV-46 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

21 TRADE AND OTHER PAYABLES

Trade payables (note (a)) Other payables due to: — Related parties (note 34 (c)) — Third parties (note (b)) Dividend payable to shareholder of Crown Golden (note 34 (d)) Staff welfare benefit payable Accruals Other taxes payable	2016 RMB’000 2,234,565 3,008,467 493,854 2,855,178 8,289 133,496 124,198 8,858,047	2015 RMB’000 2,891,887 2,639,634 312,653 2,505,615 8,434 71,042 140,524 8,569,789	2014 RMB’000 1,935,526 3,048,027 292,568 3,552,673 6,472 134,448 102,657
			9,072,371

Notes:

(a) The ageing analysis of the trade payables of Crown Golden Group based on invoice date as at 31 December 2016, 2015 and 2014 is as follows:

Within 90 days Over 90 days and within 180 days Over 180 days and within 365 days Over 365 days	2016 RMB’000 1,779,255 204,515 129,542 121,253 2,234,565	2015 RMB’000 1,435,862 628,468 334,710 492,847 2,891,887	2014 RMB’000 956,737 417,432 251,825 309,532
			1,935,526

(b) The balances are cash advances and equity payables, which are unsecured, interest-free and repayable on demand.

22 OTHER (LOSSES)/GAINS, NET

(Reversal of gains)/gains on disposal of property, plant and equipment (note (a)) (Losses)/gains on disposal of investment properties Exchange (losses)/gains, net (note (b))	2016 RMB’000 (210,626) (16,087) (76,950) (303,663)	2015 RMB’000 215,668 2,944 (32,025) 186,587	2014 RMB’000 — — 191
			191

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ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Note:

(a) Amount represents the gain on disposal of property, plant and equipment determined by comparing the proceeds with the carrying amount. During the year ended 31 December 2015, Crown Golden Group disposed of a hotel property to an independent third party (the ‘‘Buyer’’) and recognised a gain of approximately RMB210,626,000. However, during the year ended 31 December 2016, the Buyer was unable to complete the transaction. As a result, the transaction was cancelled and the gain of approximately RMB210,626,000 was reversed during the year ended 31 December 2016.
(b) Amount mainly represents the loss or gain of translation of financial assets and liabilities, which are denominated in foreign currency into RMB at the prevailing year-end exchange rate.

23 OTHER INCOME

Interest income Forfeited deposits from customers Miscellaneous OTHER EXPENSES Charitable donations Miscellaneous	2016 RMB’000 32,919 8,339 726 41,984 2016 RMB’000 31,658 2,695 34,353	2015 RMB’000 26,887 — 1,598 28,485 2015 RMB’000 1,603 2,392 3,995	2014 RMB’000 46,250 2,179 3,943
			52,372
			2014 RMB’000 12,513 1,174
			13,687

24 OTHER EXPENSES

– IV-48 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

25 EXPENSES BY NATURE

2016 RMB’000 210,421 748 281,538 279,233 165,556 1,071 4,635	2015 RMB’000 268,128 832 175,260 86,538 130,984 1,081 1,410	2014 RMB’000 269,007 654 273,906 89,468 90,876 940 2,133
976 3,659	924 486	813 1,320
5,175,273 225,839 101,160 22,291 6,417 186,500 6,660,682	2,965,532 386,860 108,378 23,620 2,973 173,207 4,324,803	2,415,146 351,037 73,501 20,863 1,425 167,231
		3,756,187

Note:

(a) Crown Golden Group was subject to business taxes of 5% and other levies on their revenues from sales of properties in the PRC by 30 April 2016. Effective from 1 May 2016, the proceeds arising from sales of properties in PRC are subject to value added taxes of 5% and other levies.

26 EMPLOYEE BENEFIT EXPENSE

Wages and salaries Pension costs — statutory pension (note (a)) Staff welfare Medical benefits Other allowances and benefits	2016 RMB’000 164,246 13,961 19,239 2,282 10,693 210,421	2015 RMB’000 209,796 14,939 28,608 2,451 12,334 268,128	2014 RMB’000 215,197 10,778 33,731 905 8,396
			269,007

Notes:

(a) Employees in Crown Golden Group’s PRC subsidiaries are required to participate in a defined contribution retirement scheme administrated and operated by the local municipal government. Crown Golden Group’s PRC subsidiaries contribute funds, which are calculated on certain percentage of the average employee salary as agreed by local municipal government to the scheme to fund the retirement benefits of the employees.

– IV-49 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

(b) Five highest paid individuals

The five individuals whose emoluments were the highest in Crown Golden Group for the year do not include any directors whose emoluments are reflected in the analysis shown in Note 37. The emoluments payable to the five highest paid individuals during the years ended 2016, 2015 and 2014 are as follows:

Salaries and bonuses	2016 RMB’000 15,563	2015 RMB’000 11,198	2014 RMB’000 11,252

The emoluments fell within the following bands:

Emolument bands (in HK dollar) HK$500,001–HK$1,000,000 HK$1,000,001–HK$1,500,000 HK$1,500,001–HK$2,000,000 HK$2,500,001–HK$3,000,000 HK$3,000,001–HK$3,500,000 HK$3,500,001–HK$4,000,000 HK$7,500,001–HK$8,000,000 HK$8,000,001–HK$8,500,000 HK$9,500,001–HK$10,000,000	Number of individuals 2016 2015 2014 — 1 1 1 2 2 1 — 1 — 1 — 1 — — 1 — — — 1 — 1 — — — — 1

(c) During the years ended 31 December 2016, 2015 and 2014, no emolument was paid by Crown Golden Group to any of the directors or the five highest paid individuals as an inducement to join or upon joining Crown Golden Group or as compensation for loss of offices.

27 FINANCE COSTS, NET

Interest expense: — Bank borrowings Less: interest capitalised	2016 RMB’000 88,355 (57,851) 30,504	2015 RMB’000 121,178 (79,894) 41,284	2014 RMB’000 98,603 (44,035)
			54,568

– IV-50 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

28 INCOME TAX EXPENSES

Current income tax: — PRC corporate income tax — PRC land appreciation tax — PRC withholding income tax Deferred income tax (note 20) — PRC corporate income tax	2016 RMB’000 265,748 333,079 55,379 (10,583) 643,623	2015 RMB’000 502,155 883,594 162,673 (8,903) 1,539,519	2014 RMB’000 432,497 952,873 125,103 (12,109) 1,498,364

The income tax on Crown Golden Group’s profit before tax differs from the theoretical amount that would arise using the enacted tax rate of the home countries or regions of Crown Golden Group entities as follows:

Profit before income tax Tax calculated at tax rates applicable to profits in the respective entities of Crown Golden Group Tax effects of: — Expenses not deductible for income tax (note (a)) — PRC land appreciation tax deductible for calculation of income tax purposes PRC corporate income tax PRC withholding income tax PRC land appreciation tax	2016 RMB’000 1,221,801 305,450 32,985 (83,270) 255,165 55,379 333,079 643,623	2015 RMB’000 2,783,669 695,917 18,234 (220,899) 493,252 162,673 883,594 1,539,519	2014 RMB’000 2,528,549 632,137 26,469 (238,218) 420,388 125,103 952,873 1,498,364

Note:

(a) Expenses not deductible for income tax for the years ended 31 December 2016, 2015 and 2014 mainly comprise administrative expense of domestic companies over deduction limits, donations made to non-official public welfare institutions, exchange loss and expenses of Crown Golden Group entities in Hong Kong.

PRC land appreciation tax

PRC land appreciation tax is levied at progressive rate ranging from 30% to 60% on the appreciation of land value, being the proceeds of sales of properties less deductible expenditures including land use rights and expenditures directly related to property development activities.

PRC corporate income tax

The income tax provision of Crown Golden Group in respect of operations in Mainland China has been calculated at the applicable tax rate on the estimated assessable profits for the year, based on the existing legislation, interpretations and practices in respect thereof.

– IV-51 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

The corporate income tax rate applicable to Crown Golden Group entities located in Mainland China is 25% according to the Corporate Income Tax Law of the People’s Republic of China (the ‘‘CIT Law’’) effective on 1 January 2008.

PRC withholding income tax

According to the CIT Law, starting from 1 January 2008, a withholding tax of 10% will be levied on the immediate holding companies outside the PRC when their PRC subsidiaries declare dividend out of profits earned after 1 January 2008. A lower of 5% withholding tax rate may be applied when the immediate holding companies of the PRC subsidiaries are established in Hong Kong and fulfil requirements under the tax treaty arrangements between the PRC and Hong Kong.

Overseas income tax

Crown Golden was incorporated in the BVI. Group entities in the British Virgin Islands were incorporated either under the BVI Business Companies Act or were automatically re-registered under the same act on 1 January 2007 and, accordingly, are exempted from British Virgin Islands income tax.

Hong Kong profits tax

No provision for Hong Kong profits tax has been made in the consolidated financial statements as Crown Golden and Crown Golden Group did not have assessable profit in Hong Kong for the year. The profit of Crown Golden Group entities in Hong Kong is mainly derived from dividend income and interest income of bank deposits, which are not subject to Hong Kong profits tax.

29 DIVIDENDS

Dividend (note (a)) Note:	2016 RMB’000 508,871	2015 RMB’000 1,462,624	2014 RMB’000 1,142,053

(a) Dividends represented dividends declared by Crown Golden for the years ended 31 December 2016, 2015 and 2014. During the year ended 31 December 2016, pursuant to the board minutes dated 20 September 2016, Crown Golden declared the dividend of RMB508,871,000, among which, RMB327,750,000 was distributed from share premium and the remaining RMB181,121,000 was distributed from retained earnings of Crown Golden. During the years ended 31 December 2015 and 2014, all dividends were distributed from retaining earnings of Crown Golden.

– IV-52 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

30 CASH GENERATED FROM OPERATIONS

Profit for the year Adjustments for: Taxation (note 28) Interest income (note 23) Depreciation (note 6) Amortisation of intangible assets (note 8) Amortisation of land use rights (note 7) Losses/(gains) on disposal of investment properties Reverse of disposal gain/(gains) of property, plant and equipment Net exchange losses/(gains) Fair value gains on investment properties Finance costs, net (note 27) Changes in working capital: Property under development and completed properties held for sale Prepayments for acquisition of land use rights Restricted cash Trade and other receivables Trade and other payables and accruals Advance proceeds received from customers Cash generated from operations	2016 RMB’000 578,178 643,623 (32,919) 165,556 1,071 4,635 16,087 210,626 76,950 2,439 30,504 3,461,667 (31,489) (798,709) 210,916 (698,255) (135,897) 3,704,983	2015 RMB’000 1,244,150 1,539,519 (26,887) 130,984 1,081 1,410 (2,944) (215,668) 32,025 21,940 41,284 (922,022) — 57,510 147,841 946,028 (656,407) 2,339,844	2014 RMB’000 1,030,185 1,498,364 (46,250) 90,876 940 2,133 — — (191) 25,854 54,568 (758,061) — (224,212) 96,491 (36,969) 346,716
			2,080,444

Non-cash transactions

The principal non-cash transaction during the year ended 31 December 2016 is the transfer of construction cost from properties under development to self-owned properties discussed in Note 6. There was no non-cash transaction during the years ended 31 December 2015 and 2014.

31 FINANCIAL GUARANTEE

Guarantee in respect of mortgage facilities for certain purchasers (note (a)) Note:	2016 RMB’000 3,082,412	2015 RMB’000 1,585,209	2014 RMB’000 834,298

(a) Crown Golden Group has cooperated with certain financial institutions to arrange mortgage loan facilities for its purchasers of properties and provide guarantees to secure obligations of such purchasers for repayments. As at 31 December 2016, 2015 and 2014, the outstanding guarantees amounted to RMB3,082,412,000, RMB1,585,209,000 and RMB834,298,000, respectively. Such guarantees will be discharged upon the earlier of (i) issuance of the real estate ownership certificate which will generally be available within one year after the purchasers take possession of the relevant property; and (ii) the satisfaction of relevant mortgage loan by purchasers.

– IV-53 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Pursuant to the terms of the guarantees, upon default in mortgage payments by these purchasers, Crown Golden Group is responsible to repay the outstanding mortgage principals together with any accrued interests and penalties owed by the defaulted purchasers to the financial institutions, and Crown Golden Group is entitled to take over the legal title and possession of the related properties. Crown Golden Group’s guarantee starts from the dates the mortgagees grant the mortgage loans. No provision has been made for the guarantees as the management is of the view that the net realisable value of the related properties can cover the repayment of the outstanding mortgage principals together with the accrued interests and penalties in case of any default in payments.

32 COMMITMENTS

(a) Operating lease commitments

The future aggregate minimum lease payments under non-cancellable operating leases are as follows:

Property, plant and equipment: — Not later than one year — Later than one year and not later than five years (b) Other commitments Contracted but not provided for — Property development activities — Acquisition of land use rights	2016 RMB’000 949 1,844 2,793 2016 RMB’000 2,535,444 118,127 2,653,571	2015 RMB’000 3,779 2,608 6,387 2015 RMB’000 3,297,650 — 3,297,650	2014 RMB’000 2,469 —
			2,469
			2014 RMB’000 5,398,961 —
			5,398,961

33 FUTURE MINIMUM RENTAL PAYMENTS RECEIVABLE

Crown Golden Group had future aggregate minimum lease rental receivables under non-cancellable operating leases as follows:

Not later than one year Later than one year and not later than five years Over five years	2016 RMB’000 3,604 57,463 97,775 158,842	2015 RMB’000 4,903 37,574 57,631 100,108	2014 RMB’000 2,878 20,070 50,519
			73,467

– IV-54 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

34 RELATED PARTY TRANSACTIONS

(a) Name and relationship with related parties

Name Relationship Top Coast Investment Limited The ultimate holding company of Crown Golden Agile Group Holdings Limited (‘‘Agile Group’’) The intermediate holding 雅居樂集團控股有限公司 company of Crown Golden Forever Fame Property Development Holdings Limited The parent company of (‘‘Forever Fame’’) Crown Golden 譽永房地產發展地產控股有限公司 Profitica Group (BVI) Limited (‘‘Profitica’’) Fellow subsidiary 盈嘉集團(BVI)有限公司 Giant Sea Holdings Limited (‘‘Giant Sea’’) Fellow subsidiary 添洋控股有限公司 Stand Power Investments Limited (‘‘Stand Power’’) Fellow subsidiary 衛中投資有限公司 Era Creation Advertising Limited (‘‘Era Creation’’) Fellow subsidiary 創歷廣告有限公司 Hong Kong Agile Property Management Services Limited Fellow subsidiary (‘‘HK Agile PM’’) 香港雅居樂物業管理服務有限公司 Agile Property Land Co., Ltd. (‘‘Agile Property’’) (note (i)) Fellow subsidiary 雅居樂地產置業有限公司 Changzhou Agile Real Estate Development Co., Ltd. (‘‘Changzhou Fellow subsidiary Agile’’) (note (i)) 常州雅居樂房地產開發有限公司 Foshan Agile Real Estate Development Co., Ltd. (‘‘Foshan Agile’’) Fellow subsidiary (note (i)) 佛山市雅居樂房地產有限公司 Guangzhou Panyu Agile Realty Development Co., Ltd. Fellow subsidiary (Guangzhou Panyu’’) (note (i)) 廣州番禺雅居樂房地產開發有限公司 Guangzhou Huadu Agile Realty Development Co., Ltd. Fellow subsidiary (Guangzhou Huadu’’) (note (i)) 廣州花都雅居樂房地產開發有限公司 Guangzhou Agile Real Estate Development Co., Ltd. (‘‘Guangzhou Fellow subsidiary Agile’’) (note (i)) 廣州雅居樂房地產開發有限公司 Guangzhou Yayue Real Estate Development Co., Ltd. Fellow subsidiary (‘‘Guangzhou Yayue’’) (note (i)) 廣州雅粵房地產開發有限公司 Guangzhou Zhenzhong Construction Co., Ltd. (‘‘Guangzhou Fellow subsidiary Zhenzhong’’) (note (i)) 廣州振中建設有限公司 Hainan Yacheng Real Estate Development Co., Ltd. (‘‘Hainan Fellow subsidiary Yacheng’’) (note (i)) 海南雅誠房地產開發有限公司 Hainan Yahang Travel Property Co., Ltd. (‘‘Hainan Yahang’’) Fellow subsidiary (note (i)) 海南雅航旅遊置業有限公司

– IV-55 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Name	Relationship
Hainan Yahe Real Estate Development Co., Ltd. (‘‘Hainan Yahe’’)	Fellow subsidiary
海南雅和房地產開發有限公司
Hainan Yahong Real Estate Development Co., Ltd. (‘‘Hainan	Fellow subsidiary
Yahong’’) (note (i))
海南雅鴻房地產開發有限公司
Heyuan Agile Real Estate Development Co., Ltd. (‘‘Heyuan Agile’’)	Fellow subsidiary
(note (i))
河源市雅居樂房地產開發有限公司
Huizhou Bailuhu Tour Enterprise Development Co., Ltd.	Fellow subsidiary
(‘‘Huizhou Bailuhu’’) (note (i))
惠州白鷺湖旅遊實業開發有限公司
Lai’an Agile Real Estate Development Co., Ltd. (‘‘Laian Agile’’)	Fellow subsidiary
(note (i))
來安雅居樂房地產開發有限公司
Liaoning Agile Real Estate Development Co., Ltd. (‘‘Liaoning	Fellow subsidiary
Agile’’) (note (i))
遼寧雅居樂房地產開發有限公司
Nanjing Binjiang Agile Real Estate Development Co., Ltd.	Fellow subsidiary
(‘‘Nanjing Binjiang’’) (note (i))
南京濱江雅居樂房地產開發有限公司
Nanjing Jiangning Agile Real Estate Development Co., Ltd.	Fellow subsidiary
(‘‘Nanjing jiangning’’) (note (i))
南京江寧雅居樂房地產開發有限公司
Nanjing Yajian Land Co., Ltd. (‘‘Nanjing Yajian’’) (note (i))	Fellow subsidiary
南京雅建置業有限公司
Nanjing Agile Real Estate Development Co., Ltd. (‘‘Nanjing	Fellow subsidiary
Agile’’) (note (i))
南京雅居樂房地產開發有限公司
Ruili Agile Resort Co., Ltd. (‘‘Ruili Agile’’) (note (i))	Fellow subsidiary
瑞麗雅居樂旅遊置業有限公司
Foshan Sanshui Agile Real Estate Development Co., Ltd.	Fellow subsidiary
(‘‘Sanshui Agile’’) (note (i))
佛山市三水雅居樂房地產開發有限公司
Foshan Sanshui Agile Majestic Garden Real Estate Co., Ltd.	Fellow subsidiary
(‘‘Sanshui Majestic’’) (note (i))
佛山市三水雅居樂雍景園房地產有限公司
Shanghai Songjiang Agile Real Estate Development Co., Ltd.	Fellow subsidiary
(‘‘Shanghai Songjiang’’) (note (i))
上海松江雅居樂房地產開發有限公司
Foshan Shunde Agile Real Estate Development Co., Ltd. (‘‘Shunde	Fellow subsidiary
Agile’’) (note (i))
佛山市順德區雅居樂房地產開發有限公司
Foshan Shunde Yaxin Real Estate Development Co., Ltd.	Fellow subsidiary
(‘‘Shunde Yaxin’’) (note (i))
佛山市順德區雅新房地產開發有限公司
Tengchong Agile Resort Co., Ltd. (‘‘Tengchong Agile’’) (note (i))	Fellow subsidiary
騰沖雅居樂旅遊置業有限公司
Wuxi Agile Real Estate Development Co., Ltd. (‘‘Wuxi Agile’’)	Fellow subsidiary
(note (i))
無錫雅居樂房地產開發有限公司

– IV-56 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Name Relationship Agile Property Management Services Co., Ltd (‘‘Agile PM’’) Fellow subsidiary (note (i)) 雅居樂物業管理服務有限公司 Agile Property Management Services Co., Ltd, Sanya Branch Fellow subsidiary (‘‘Sanya PM’’) (note (i)) 雅居樂物業管理服務有限公司三亞分公司 Agile Property Management Services Co., Ltd, Wenchang Branch Fellow subsidiary (‘‘Wenchang PM’’) (note (i)) 雅居樂物業管理服務有限公司文昌分公司 Xian Qujiang Agile Real Estate Development Co., Ltd. (‘‘Xian Fellow subsidiary Qujiang’’) (note (i)) 西安曲江雅居樂房地產開發有限公司 Xishuangbanna Agile Resort Co., Ltd. (‘‘Xishuangbanna Agile’’) Fellow subsidiary (note (i)) 西雙版納雅居樂旅遊置業有限公司 Yangzhou Agile Real Estate Development Co., Ltd. (‘‘Yangzhou Fellow subsidiary Agile’’) (note (i)) 揚州雅居樂房地產開發有限公司 Zhenjiang Agile Real Estate Development Co., Ltd. (‘‘Zhenjiang Fellow subsidiary Agile’’) (note (i)) 鎮江雅居樂房地產開發有限公司 Zhongshan Greenville Realty Development Co., Ltd. (‘‘Zhongshan Fellow subsidiary Kaiyin’’) (note (i)) 中山市凱茵豪園房地產開發有限公司 Zhongshan Agile Hotel Co., Ltd. (‘‘Zhongshan Agile Hotel’’) Fellow subsidiary (note (i)) 中山市雅居樂酒店有限公司 Zhongshan Fashion Decoration Co., Ltd. (‘‘Zhongshan Fashion’’) Fellow subsidiary (note (i)) 中山市時興裝飾有限公司 Zhongshan Yachuang Real Estate Development Co., Ltd. Fellow subsidiary (‘‘Zhongshan Yachuang’’) (note (i)) 中山市雅創房地產開發有限公司 Zhongshan Yafeng Trading Co., Ltd. (‘‘Zhongshan Yafeng’’) Fellow subsidiary (note (i)) 中山市雅豐貿易有限公司 Zhongshan Yahong Real Estate Development Co., Ltd. Fellow subsidiary (‘‘Zhongshan Yahong’’) (note (i)) 中山市雅鴻房地產開發有限公司 Zhongshan Ever Creator Real Estate Development Co., Ltd. Fellow subsidiary (‘‘Zhongshan Yajian’’) 中山市雅建房地產開發有限公司 Zhongshan Yajing Real Estate Development Co., Ltd. Fellow subsidiary (‘‘Zhongshan Yajing’’) (note (i)) 中山市雅景房地產開發有限公司 Zhongshan Yashang Real Estate Development Co., Ltd. Fellow subsidiary (‘‘Zhongshan Yashang’’) (note (i)) 中山市雅尚房地產開發有限公司 Zhongshan Yaxin Real Estate Development Co., Ltd. (‘‘Zhongshan Fellow subsidiary Yaxin’’) (note (i)) 中山市雅信房地產開發有限公司

– IV-57 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Name

Relationship

Zhongshan Agile Majestic Garden Real Estate Co., Ltd. Fellow subsidiary (‘‘Zhongshan Majestic’’) (note (i)) 中山雅居樂雍景園房地產有限公司 Chongqing Gangya Land Co., Ltd. (‘‘Chongqing Gangya’’) Fellow subsidiary (note (i)) 重慶港雅置業有限公司 Shanghai Jing’an Chengtou Chongqing Land Co., Ltd. Fellow subsidiary (‘‘Chongqing Zhiye’’) (note (i)) 上海靜安城投重慶置業有限公司

Note (i) The names of the companies represent management’s best efforts at translating the Chinese names of these companies as no English names have been registered or available.

(b) Transactions with related parties

During the years ended 31 December 2016, 2015 and 2014, Crown Golden Group had the following transactions with related parties, which are carried out in the normal course of Crown Golden Group’s business:

Key management compensation

Key management includes heads of major operational departments. The compensation paid or payable to key management for employee services is shown below:

— Salaries and other short-term employee benefits — Retirement scheme contributions	2016 RMB’000 15,495 68 15,563	2015 RMB’000 11,142 56 11,198	2014 RMB’000 11,186 66
			11,252

– IV-58 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

(c) Balances with related parties

As at 31 December 2016, 2015 and 2014, Crown Golden Group had the following significant nontrade balances with related parties:

Due from related parties (note (i)) — Hainan Yahang — Forever Fame — Hainan Yacheng — Agile Property — Agile PM — Tengchong Agile — Xishuangbanna Agile — Ruili Agile — Guangzhou Zhenzhong — Zhongshan Yajian — Zhongshan Yaxin — Zhongshan Yashang — Wuxi Agile — Liaoning Agile — Nanjing Jiangning — Nanjing Binjiang — Nanjing Agile — Yangzhou Agile — Hainan Yahong — Guangzhou Huadu — Changzhou Agile — Laian Agile — Others Due to related parties (note (i)) — Agile Group — Forever Fame — Profitica — HK Agile PM — Stand Power — Giant Sea — Shunde Agile — Zhongshan Yachuang — Zhongshan Yahong — Zhongshan Yajing — Zhongshan Kaiyin — Guangzhou Panyu — Zhongshan Agile Hotel — Shanghai Songjiang — Sanshui Majestic — Others	2016 RMB’000 4,558,905 1,686,183 1,227,895 219,950 72,236 12,753 8,808 — — — — — — — — — — — — — — — 8 7,786,738 1,452,163 1,063,537 437,163 40,451 6,587 5,219 — — — — — — — — — 3,347 3,008,467	2015 RMB’000 4,882,046 1,579,245 1,146,727 7,780 44,277 34,527 20,331 20,395 — — — — — — — — — — — — — — 901 7,736,229 1,203,104 996,087 409,438 30,979 — — — — — — — — — — — 26 2,639,634	2014 RMB’000 187,397 1,487,670 1,190,890 7,445,584 — 612 7,293 7,582 125,160 71,307 28,317 27,912 20,000 17,992 13,825 8,384 7,712 6,888 6,463 6,350 4,646 4,455 10,493
			10,686,932
			1,548,097 938,328 423,485 26,427 — — 37,351 14,189 8,915 8,082 7,135 6,673 5,000 4,385 4,342 15,618
			3,048,027

– IV-59 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

Note:

(i) The balances are cash advances in nature, which are unsecured, interest-free and repayable on demand.
(d) Dividend payable to shareholder of Crown Golden

Dividend payable to shareholder of Crown Golden — Forever Fame	2016 RMB’000 2,855,178	2015 RMB’000 2,505,615	2014 RMB’000 3,552,673

35 ULTIMATE HOLDING COMPANY

The directors of Crown Golden consider Top Coast Investment Limited, a company incorporated in the British Virgin Island, to be the ultimate holding company of Crown Golden Group.

36 INVESTMENTS IN SUBSIDIARIES

(a) Particulars of principal subsidiaries of Crown Golden Group as at 31 December 2016, 2015 and 2014 are set out below:

				Proportion of	Proportion of
			Proportion of	ordinary shares	ordinary shares
			ordinary shares	held by Crown	held by non-
	Place of incorporation	Principal activities/place	directly held by	Golden Group	controlling
Name	and legal status	of operation	parent (%)	(%)	interests (%)
Directly held by Crown Golden
順邦國際有限公司	British Virgin Islands	Investment holding/	100%	100%	—
Smooth State International Limited	(the ‘‘BVI’’)/limited	Hong Kong
	liability Company
傲凱投資有限公司	British Virgin Islands	Investment holding/	100%	100%	—
Pride Height Investments Ltd	(the ‘‘BVI’’)/limited	Hong Kong
	liability Company
Indirectly held by Crown Golden
澤高集團有限公司	Hong Kong/limited	Investment holding/	—	100%	—
Giant Top Group Limited	liability Company	Hong Kong
曉高集團有限公司	Hong Kong/limited	Investment holding/	—	100%	—
On Sky Group Limited	liability Company	Hong Kong
海南雅居樂房地產開發有限公司	PRC/wholly foreign	Property development/	—	100%	—
Hainan Agile Real Estate Development	owned enterprise	Mainland China
Co., Ltd. (note (i))
海南雅恒房地產開發有限公司	PRC/wholly foreign	Property development/	—	100%	—
Hainan Yaheng Real Estate Development	owned enterprise	Mainland China
Co., Ltd. (note (i))
海南雅居樂房地產開發有限公司雅居樂萊佛士	PRC/wholly foreign	Hotel operation/	—	100%	—
酒店	owned enterprise	Mainland China
Hainan Agile Real Estate Development
Co., Ltd. Agile Raffles Hotel (note (i))
海南雅居樂房地產開發有限公司清水灣萬豪度	PRC/wholly foreign	Hotel operation/	—	100%	—
假酒店	owned enterprise	Mainland China
Hainan Agile Real Estate Development
Co., Ltd. Lingshui Clearwater Bay
Marriott Hotel (note (i))
海南雅居樂房地產開發有限公司雅居樂假日度	PRC/wholly foreign	Hotel operation/	—	100%	—
假酒店	owned enterprise	Mainland China
Hainan Agile Real Estate Development
Co., Ltd. Agile Holidayinn Hotel
(note (i))

– IV-60 –

ACCOUNTANT’S REPORT OF CROWN GOLDEN GROUP

APPENDIX IV

				Proportion of	Proportion of
			Proportion of	ordinary shares	ordinary shares
			ordinary shares	held by Crown	held by non-
	Place of incorporation	Principal activities/place	directly held by	Golden Group	controlling
Name	and legal status	of operation	parent (%)	(%)	interests (%)
海南雅居樂房地產開發有限公司陵水清水灣遊	PRC/wholly foreign	Yacht management/	—	100%	—
艇會分公司	owned enterprise	Mainland China
Hainan Agile Real Estate Development
Co., Ltd. Lingshui Clearwater Bay Yacht
Club (note (i))
海南百匯景區管理有限公司	PRC/wholly foreign	Attraction management/	—	100%	—
Hainan Baihui Attraction Management	owned enterprise	Mainland China
Co., Ltd. (note (i))
海南清水灣水務有限公司	PRC/wholly foreign	Water treatment/	—	100%	—
Hainan Clearwater Bay Services Co., Ltd.	owned enterprise	Mainland China
(note (i))
海南雅居樂物業服務有限公司	PRC/wholly foreign	Property management/	—	100%	—
Hainan Agile Property Services Co., Ltd.	owned enterprise	Mainland China
(note (i))

The above table lists all subsidiaries of Crown Golden Group.

Note (i): The names of the companies represent management’s best efforts at translating the Chinese names of these companies as no English names have been registered or available.

37 BENEFITS AND INTERESTS OF DIRECTORS

The directors did not receive or were entitled to receive any fees and other emoluments from Crown Golden for the years. During the years ended 31 December 2016, 2015 and 2014, the directors of Crown Golden received emoluments totalling RMB7,507,000, RMB7,055,000 and RMB9,270,000 respectively from Agile Group, the intermediate holding Company of Crown Golden, in respect of their services to Agile Group accordingly. No apportionment has been made to Crown Golden as the directors consider it is impractical to determine an appropriate basis for apportionment to Crown Golden.

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by Crown Golden or any of its subsidiaries in respect of any period subsequent to 31 December 2016 and up to the date of this report. No dividend or distribution has been declared or made by Crown Golden or any of its subsidiaries in respect of any period subsequent to 31 December 2016.

– IV-61 –

APPENDIX V

GENERAL INFORMATION

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of providing information with regards to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

DISCLOSURE OF INTERESTS

Directors’ Interests and Short Positions in Shares, Underlying Shares and Debentures

As at Latest Practicable Date, the interests or short positions of the Directors and chief executives of the Company in the Shares, underlying Shares and debentures of the Company and any of its associated corporations (within the meaning of Part XV of SFO) which (i) were notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of SFO (including interests or short positions which they were taken or deemed to have under such provisions of SFO); or (ii) were recorded in the register required to be kept by the Company under Section 352 of SFO; or (iii) were required by the code for securities transactions by Directors adopted by the Company (‘‘Securities Dealing Code for Directors’’), which is on terms no less exacting than the required standard as set out in the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 of the Listing Rules, to be notified to the Company and the Stock Exchange, were as follows:

(1) Long positions in Shares

Name of Director
Chen Zhuo Lin
Chan Cheuk Yin
Luk Sin Fong,
Fion
Chan Cheuk Hung
Chan Cheuk Hei

Shares held in the Company
Approximate
percentage to
issued share
capital
Capacity of
interests held
Number of
Shares
Note
Total number of
Shares
Beneficiary of a trust
2,453,096,250
1
2,467,372,500
62.99%
Controlled corporation
14,276,250
2
Beneficiary of a trust
2,453,096,250
1
2,468,783,750
63.03%
Controlled corporation
15,687,500
3
Beneficiary of a trust
2,453,096,250
1
2,467,372,500
62.99%
Controlled corporation
14,276,250
2
Beneficiary of a trust
2,453,096,250
1
2,453,096,250
62.63%
Beneficiary of a trust
2,453,096,250
1
2,460,971,250
62.83%
Beneficial owner
7,875,000
4

– V-1 –

APPENDIX V

GENERAL INFORMATION

Name of Director Chan Cheuk Nam Chen Zhongqi Huang Fengchao	Shares held in the Company Approximate percentage to issued share capital Capacity of interests held Number of Shares Note Total number of Shares Beneficiary of a trust 2,453,096,250 1 2,459,877,750 62.80% Beneficial owner 6,781,500 5 Spouse 187,000 6 807,000 0.02% Others 620,000 7 Beneficial owners 1,400,000 2,020,000 0.05% Others 620,000 7

Notes:

Held by Full Choice Investments Limited (‘‘Full Choice’’) as trustee through Top Coast Investment Limited (‘‘Top Coast’’).
Held by Brilliant Hero Capital Limited (暉雄資本有限公司) and Famous Tone Investments Limited (名通投資有限公司), which are jointly controlled by Chen Zhuo Lin and Luk Sin Fong, Fion.
Held by Renowned Idea Investments Limited (明思投資有限公司), which is wholly-owned by Chan Cheuk Yin.
Jointly held by Chan Cheuk Hei and his spouse Lu Yanping.
Jointly held by Chan Cheuk Nam and his spouse Chan Siu Na.
Held by Sun Hong, the spouse of Chen Zhongqi. By virtue of SFO, Chen Zhongqi is deemed to be interested in the Shares held by his spouse Sun Hong.
Each of Huang Fengchao and Chen Zhongqi is entitled to receive 620,000 Shares upon the satisfaction of relevant vesting conditions specified by the Board under the Share Award Scheme at the time of the grant. Those Shares are still held on trust by Bank of Communications Trustee Limited until the satisfaction of the vesting conditions.

(2) Long positions in the debentures of the Company

			Approximate
		Personal	percentage to
Name of Director	Type	Interests	the debentures
Kwong Che Keung,	9% senior notes in an	US$500,000	0.1%
Gordon	aggregate principal
	amount of US$500
	million due by 2020

– V-2 –

GENERAL INFORMATION

APPENDIX V

(3) Long positions in the shares of associated corporation of the Company

As at Latest Practicable Date, Chen Zhuo Lin and Chan Cheuk Yin, as Directors of the Company, were deemed to be interested in two ordinary shares, representing 100% of the then issued voting shares, in Top Coast, a company wholly-owned by Full Choice which in turn owned as to 50% by Chen Zhuo Lin and Chan Cheuk Yin respectively.

Save as disclosed above, as at Latest Practicable Date, none of the Directors and chief executive of the Company had any interests or short positions in the Shares, underlying Shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of SFO) which (i) were notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of SFO (including interests or short positions which they were taken or deemed to have under such provisions of SFO); or (ii) were recorded in the register required to be kept by the Company under Section 352 of SFO; or (iii) were required by Securities Dealing Code for Directors to be notified to the Company and the Stock Exchange.

Substantial Shareholders’ Interests and Short Positions

To the best knowledge of the Directors or chief executive of the Company, as at Latest Practicable Date, the interests or short positions of substantial Shareholders (other than Directors or the chief executive of the Company) in the Shares or underlying Shares which (i) have been disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of SFO or (ii) were recorded in the register required to be kept by the Company under Section 336 of SFO were as follows:

Long positions in Shares

Name of Shareholder Full Choice Top Coast Zheng Huiqiong Lu Liqing	Shares held in the Company Approximate percentage to issued share capital Capacity of interests held Number of shares Note Total number of Shares Trustee 2,453,096,250 1 2,453,096,250 62.63% Beneficial owner 2,453,096,250 1 2,453,096,250 62.63% Spouse 2,468,783,750 2 2,468,783,750 63.03% Spouse 2,453,096,250 3 2,453,096,250 62.63%

– V-3 –

APPENDIX V

GENERAL INFORMATION

Name of Shareholder Lu Yanping Chan Siu Na	Shares held in the Company Approximate percentage to issued share capital Capacity of interests held Number of shares Note Total number of Shares Beneficial owner 7,875,000 4 2,460,971,250 62.83% Spouse 2,453,096,250 5 Beneficial owner 6,781,500 6 2,459,877,750 62.80% Spouse 2,453,096,250 7

Notes:

Full Choice holds, through Top Coast, the Shares as the trustee of the Chen’s Family Trust. Beneficiaries of which are Chen Zhuo Lin, Chan Cheuk Yin, Luk Sin Fong, Fion, Chan Cheuk Hung, Chan Cheuk Hei and Chan Cheuk Nam.
By virtue of the SFO, Zheng Huiqiong is deemed to be interested in the Shares held by her spouse, Chan Cheuk Yin.
By virtue of the SFO, Lu Liqing is deemed to be interested in the Shares held by her spouse, Chan Cheuk Hung.
Jointly held by Lu Yanping and her spouse, Chan Cheuk Hei.
By virtue of the SFO, Lu Yanping is deemed to be interested in the Shares held by her spouse, Chan Cheuk Hei.
Jointly held by Chan Siu Na and her spouse, Chan Cheuk Nam.
By virtue of the SFO, Chan Siu Na is deemed to be interested in the Shares held by her spouse, Chan Cheuk Nam.

Save as disclosed above, as at Latest Practicable Date, none of the substantial Shareholders (other than Directors or chief executives of the Company) had informed the Company that they had any interests or short positions which (i) shall disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of SFO or (ii) shall be recorded in the register required to be kept by the Company under Section 336 of SFO.

DIRECTORS’ INTERESTS IN ASSETS, CONTRACTS OR ARRANGEMENT SIGNIFICANT TO THE GROUP

As at the Latest Practicable Date, none of the Directors had any direct or indirect interests in any assets which had been acquired or disposed of by, or leased to, or are proposed to be acquired or disposed of by, or leased to, the Company or any of its subsidiaries since 31 December 2016, the date to which the latest published audited consolidated financial statements of the Company were made up.

As at the Latest Practicable Date, none of the Directors was materially interested in any contract or arrangement which was significant in relation to the business of the Group.

– V-4 –

APPENDIX V

GENERAL INFORMATION

DIRECTORS SERVICES CONTRACTS

As at the Latest Practicable Date, none of the Directors had a service contract with any member of the Group which was not determinable by the relevant members of the Group within one year without payment of compensation, other than statutory compensation.

INTEREST IN COMPETING BUSINESS

As at Latest Practicable Date, Chen Zhuo Lin, Chan Cheuk Yin, Luk Sin Fong, Fion, Chan Cheuk Hung, Chan Cheuk Hei and Chan Cheuk Nam are having interests in 中山雅居樂長江酒店有限公司 (Zhongshan Agile Changjiang Hotel Co., Ltd.***) (‘‘Changjiang Hotel Company’’). Changjiang Hotel Company is principally engaged in hotel business under the name of Zhongshan Agile Changjiang Hotel in Zhongshan, the PRC and competes or is likely to compete, either directly or indirectly, with the business of the Group.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors or their respective close associates was interested in any business apart from the Group’s business which competes or is likely to compete, either directly or indirectly, with the Group’s businesses.

MATERIAL CONTRACTS

Save as disclosed below, none of the members of the Group has entered into any contracts (not being contracts entered into in the ordinary course of business) within the two years immediately preceding Latest Practicable Date that are or may be material:

the SPA;
the capital increase cooperation agreement dated 5 May 2017 entered into between 中山市雅景房地產開發有限公司 (Zhongshan Yajing Real Estate Development Co., Ltd.) (‘‘Zhongshan Yajing’’), an indirect wholly-owned subsidiary of the Company, 中山市世光創建集團有限公司 (Zhongshanshi Shiguang Chuangjian Group Company Limited) (‘‘Shiguang Chuangjian’’), Zheng Zihong and Wu Zhangjin in relation to the cooperation mode for eight projects being classified into two types;
the cooperative framework agreement entered into among Zhongshan Yajing, Shiguang Chuangjian, Zheng Zihong and Wu Zhangjin on 29 March 2017, pursuant to which Zhongshan Yajing has agreed to jointly develop eight projects situated in different locations in Zhongshan area with a total land area of 660,859 square metres for a total amount of approximately RMB2,770 million;

– V-5 –

APPENDIX V

GENERAL INFORMATION

the loan commitment letter dated 28 March 2017 entered into by the Company in favour of 渤海銀行股份有限公司北京分行 (Beijing Branch of China Bohai Bank) (the ‘‘Bank’’) to provide guarantee in proportion to the 25% shareholding interests in 天津津南新城房地產開發有限公司 (Tianjin Jinnan Xincheng Property Development Company Limited) (‘‘Tianjin Jinnan’’) owned by 佛山市雅居樂房地產有限公司 (Foshan Agile Real Estate Co. Ltd) (‘‘Foshan Agile’’), an indirect wholly-owned subsidiary of the Company, and three Independent Third Parties each holding indirectly 25% equity interests in Tianjin Jinnan respectively provided guarantee in proportion to their respective equity interest in Tianjin Jinnan to the Bank, for the repayment of the loan for the principal amount of RMB3,000 million by Tianjin Jinnan to the Bank;
the entrustment loan commitment letter dated 23 November 2016 entered into by the Company in favour of the Bank to provide guarantee in proportion to the 25% shareholding interests in Tianjin Jinnan owned by Foshan Agile for the repayment of the entrustment loan for the principal amount of RMB4,500 million by Tianjin Jinnan to the Bank;
the joint venture agreement dated 9 November 2016 entered into between 中盈長江國際新能源投資有限公司 (Zhongying Changjiang International New Energy Investments Company Limited) (‘‘Zhongying’’), 南京雅居樂房地產開發有限公司 (Nanjing Agile Real Estate Development Co., Ltd.), an indirect whollyowned subsidiary of the Company, 武漢長凱物業發展有限公司 (Wuhan Changkai Property Development Company Limited) (‘‘Changkai’’) and 陽光凱迪新能源集團有限公司 (Yangguang Haidi New Energy Investments Company Limited) in relation to (i) the injection of RMB300 million into Changkai as its new registered capital and thereby owning 50% of its equity interests; and (ii) providing a loan of RMB3,000 million to Changkai;
the supplemental transfer agreement dated 20 September 2016 entered into between 中山市雅耀房地產投資有限公司 (Zhongshanshi Yayao Real Estate Investment Company Limited) (‘‘Zhongshan Yayao’’) (its equity interests being held by Zhongshan Yajing and 中山市世光創建實業有限公司 (Zhongshanshi Shiguang Changjian Industrial Company Limited) (‘‘Zhongshan Shiguang’’) as to 60% and 40% respectively), Zhongshan Shiguang, 中山市雄宇投資發展有限公司 (Zhongshanshi XiongYu Investment Development Company Limited) (‘‘Zhongshan Xiongyu’’), 中山捷滙實業投資有限公司 (Zhongshan Jiehui Shiye Investment Company Limited) (‘‘Zhongshan Jiehui’’) and 中山君匯投資發展有限公司 (Zhongshan Junhui Investment Development Company Limited***) (the ‘‘Project Company’’), whereby Zhongshan Yayao agreed to take up the obligations of Zhongshan Shiguang under the original transfer agreement dated 1 September 2016 (which was entered into between Zhongshan Shiguang, the Project Company, Zhongshan Xiongyu and Zhongshan Jiehui in relation to the acquisition of the entire equity interests in the Project Company from Zhongshan Xiongyu and Zhongshan Jiehui by Zhongshan Shiguang) in place of Zhongshan Shiguang;

– V-6 –

APPENDIX V

GENERAL INFORMATION

the joint venture agreement dated 17 August 2016 entered into between Zhongshan Yajing, Shiguang Chuangjian, Zhongshan Shiguang and the joint venture companies (the ‘‘Joint Venture Companies’’), including (1) 中山市世光創建置業有限公司 (Zhongshanshi Shiguang Chuangjian Zhiye Company Limited), (2) 中山市海德房地產開發有限公司 (Zhongshangshi Haide Property Development Limited), (3) 中山市東城實業發展有限公司 (Zhongshanshi Dongcheng Real Estate Development Company Limited), (4) 中山市名泰房地產開發有限公司 (Zhongshangshi Mingtai Property Development Company Limited), pursuant to which Zhongshan Yajing has agreed to inject funds into the Joint Venture Companies by way of new registered capital and provision of shareholder’s loans with a total amount of approximately of RMB1,247 million, such that the equity interests of each of the Joint Venture Companies are held as to 50% by Zhongshan Yajing and 50% by Zhongshan Shiguang respectively.

EXPERTS AND CONSENT

The following sets out the qualifications of the experts who have been named in this circular:

Name Qualifications PricewaterhouseCoopers Certified Public Accountants Savills Valuation and Independent Property Valuer Professional Services Limited (‘‘Savills’’)

Each of PricewaterhouseCoopers and Savills has given and has not withdrawn its written consent to the issue of this circular with the inclusion herein of its letter and references to its name, in the form and context in which they respectively appear.

As at the Latest Practicable Date, neither PricewaterhouseCoopers nor Savills had any shareholding, directly or indirectly, in any member of the Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for shares in any member of the Group.

As at the Latest Practicable Date, neither PricewaterhouseCoopers nor Savills had any interest, direct or indirect, in any assets which since 31 December 2016, the date to which the latest published audited financial statements of the Company were made up, had been acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group.

LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation or claim of material importance and, so far as the Directors are aware, no litigation or claim of material importance was pending or threatened against any member of the Group.

– V-7 –

APPENDIX V

GENERAL INFORMATION

MATERIAL ADVERSE CHANGE

GENERAL

(1) The registered office of the Company is at Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands, and the principal place of business of the Company in Hong Kong is at 18th Floor, Three Pacific Place, 1 Queen’s Road East, Hong Kong;
(2) The Hong Kong branch share registrar and transfer office of the Company is Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong;
(3) The company secretary of the Company is Mr. Lam Ping Yuk, a fellow member of the Association of Chartered Certified Accounts in the United Kingdom and the Hong Kong Institute of Certified Public Accountants; and
(4) In the event of any inconsistency, the English language text of this circular shall prevail over the Chinese language text.

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection during normal business hours (Saturdays and public holidays excepted) from 10: 00 a.m. to 1: 00 p.m. and from 2: 00 p.m. to 5: 00 p.m. at the head office and principal place of business of the Company at 18th Floor, Three Pacific Place, 1 Queen’s Road East, Hong Kong from the date of this circular up to and including the date of the EGM:

(1) the memorandum of association and articles of association of the Company;
(2) the annual reports of the Company for each of the two years ended 31 December 2015 and 2016;
(3) valuation report issued by Savills, the text of this is set out on pages III-1 to III-12 of this circular;
(4) the material contracts referred to in the above paragraph headed ‘‘Material Contracts’’ in this Appendix V;
(5) the letter of consent from Savills, referred to in the above paragraph headed ‘‘Experts and Consents’’ in this Appendix V;
(6) the letter of consent from PricewaterhouseCoopers, referred to in the above paragraph headed ‘‘Experts and Consents’’ in this Appendix V;

– V-8 –

APPENDIX V

GENERAL INFORMATION

(7) the SPA; and
(8) this circular.
*** for translation and identification purposes only as there is no official English translation or name

– V-9 –

NOTICE OF THE EGM

AGILE GROUP HOLDINGS LIMITED

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 3383)

NOTICE OF THE EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that an extraordinary general meeting of shareholders (the ‘‘EGM’’) of Agile Group Holdings Limited (the ‘‘Company’’) will be held at Harcourt Room, Lower Lobby Level, Conrad Hong Kong, Pacific Place, 88 Queensway, Hong Kong on Monday, 17 July 2017 at 2: 30 p.m. for the purpose of considering and, if thought fit, passing the following resolution as ordinary resolution. Capitalised terms defined in the circular dated 26 June 2017 issued by the Company (the ‘‘Circular’’) shall have the same meanings when used in this notice unless otherwise specified.

ORDINARY RESOLUTION

‘‘THAT the entering into and the terms and conditions of the SPA dated 9 May 2017 (as defined in the Circular) between Crown Golden Investments Limited (冠金投資有限公司), Forever Fame Property Development Holdings Limited (譽永房地產發展控股有限公司) and Crystal I Limited (a copy of which is marked ‘‘A’’ and initialed by the chairman of the meeting for the purpose of identification) and the transactions contemplated thereunder be and hereby approved, confirmed and ratified and any director of the Company be and is hereby authorised to give, make, sign, execute (under hand, seal or as a deed) and deliver any document and all such deeds, agreements, letters, notices, certificates, applications, acknowledgements, receipts, authorisations, instructions, releases, waivers, proxies, appointments of agents for service of process and other document (whether of a like nature or not) as the Directors may consider necessary or desirable for the purpose of giving effect to, or in connection with this resolution, and the Directors of the Company be and are hereby authorised to sign and execute all such further documents and to take all such actions and steps as the Directors may in their absolute discretion consider necessary, appropriate, desirable or expedient to implement and/or give full effect to or in connection with the SPA and the transactions contemplated thereunder.’’

By order of the Board Agile Group Holdings Limited LAM Pink Yuk

Company Secretary

Hong Kong, 26 June 2017

– EGM-1 –

NOTICE OF THE EGM

Notes:

A shareholder entitled to attend and vote at the meeting or any adjournment thereof is entitled to appoint another person as his proxy to attend and vote for him. A shareholder who is the holder of two or more shares in the share capital of the Company may appoint more than one proxy. A proxy need not be a shareholder of the Company.
To be valid the proxy form together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy thereof, must be lodged with the Company’s branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not less than 48 hours before the time fixed for holding the meeting or any adjournment thereof.
Delivery of proxy form shall not preclude a shareholder from attending and voting in person at the meeting or any adjournment thereof and in such event, the proxy form shall be deemed to be annulled.
The register of members of the Company will be closed from Wednesday, 12 July 2017 to Monday, 17 July, both dates inclusive, during which period no transfer of shares will be registered. In order to have right to attend and vote at the meeting or any adjournment thereof, all transfers accompanied by the relevant share certificates must be lodged with the Company’s branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited at Level 22, Hopewell Centre, 183 Queen’s Road East, Hong Kong not later than 4: 30 p.m. on Tuesday, 11 July 2017.

As at the date of this notice, the Board comprises thirteen members, being Mr. Chen Zhuo Lin (Chairman and President), Mr. Chan Cheuk Yin (Vice Chairperson), Madam Luk Sin Fong, Fion (Vice Chairperson), Mr. Chan Cheuk Hung, Mr. Huang Fengchao, Mr. Chen Zhongqi, Mr. Chan Cheuk Hei, Mr. Chan Cheuk Nam, Dr. Cheng Hon Kwan[#] , Mr. Kwong Che Keung, Gordon[#] , Mr. Cheung Wing Yui, Edward[#] , Mr. Hui Chiu Chung, Stephen[#] and Mr. Wong Shiu Hoi, Peter[#] .

Executive Directors
** Non-executive Directors
Independent Non-executive Directors

– EGM-2 –

AI assistant

Agile Group Holdings Limited — Proxy Solicitation & Information Statement 2017

50832_rns_2017-06-25_11bd4ede-170a-494d-89b0-29c92abd16ff.pdf

AGILE GROUP HOLDINGS LIMITED

(1) MAJOR AND CONNECTED TRANSACTION THE PROPOSED REPURCHASE OF

30% EQUITY INTEREST IN CROWN GOLDEN; AND

(2) NOTICE OF EGM

CONTENTS

DEFINITIONS

DEFINITIONS

AGILE GROUP HOLDINGS LIMITED

(Stock Code: 3383)

Independent Non-executive Directors

To the Shareholders

(1) MAJOR AND CONNECTED TRANSACTION THE PROPOSED REPURCHASE OF

30% EQUITY INTEREST IN CROWN GOLDEN; AND (2) NOTICE OF EGM

INTRODUCTION

LETTER FROM THE BOARD

MAJOR AND CONNECTED TRANSACTION

Major Terms of the SPA

Consideration

Deposit

Conditions Precedent

Guarantee

LETTER FROM THE BOARD

Completion

Termination and Break Fee

Information on Crown Golden

Financial Information of Crown Golden Group

LETTER FROM THE BOARD

Management Discussion and Analysis on Grown Golden Group

Business and financial review

Segment results

For the year ended 31 December 2015

Liquidity and financial resources

Pledge of assets

Contingent liabilities

Employment and remuneration policy

Information on Crown Golden Group

Information of the Target Company

Information of the Group

Reasons for and Benefits of the Repurchase

Listing Rules Implications

The EGM

LETTER FROM THE BOARD

Warning of the Risks of Dealings in the Shares

RECOMMENDATION

FURTHER INFORMATION

1. FINANCIAL INFORMATION OF THE GROUP

2. INDEBTEDNESS

Borrowings

Financial guarantee and contingent liabilities

3. MATERIAL ADVERSE CHANGE

4. WORKING CAPITAL

5. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

APPENDIX II

UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE GROUP

NOTES TO THE UNAUDITED PRO FORMA FINANCIAL INFORMATION OF THE ENLARGED GROUP:

INDEPENDENT REPORTING ACCOUNTANT’S ASSURANCE REPORT ON THE COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION

Directors’ Responsibility for the Unaudited Pro Forma Financial Information

Our Independence and Quality Control

Reporting Accountant’s Responsibilities

Opinion

INSTRUCTIONS

BASIS OF VALUATION

VALUATION METHODOLOGY

TITLE INVESTIGATION

SOURCES OF INFORMATION

VALUATION ASSUMPTIONS

SITE INSPECTION

CURRENCY

SUMMARY OF VALUES

VALUATION CERTIFICATE

Group I — Property held for sale or owner occupation in the PRC

No. Property

VALUATION CERTIFICATE

Group II — Property held under development in the PRC

No. Property Description and tenure

VALUATION CERTIFICATE

Group III — Property held for future development in the PRC

Agile Group Holdings Limited Proxy Solicitation & Information Statement 2017