COSCO SHIPPING Development Co., Ltd. - Interim / Quarterly Report 2016

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Pursuing Sustainable Opportunities 2016 Interim Report

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Corporate Information	2
Results and Business Highlights under Hong Kong
Financial Reporting Standards (“HKFRS”)	4
Management Discussion and Analysis	4
Report on Review of Interim Condensed Consolidated
Financial Statements	22
Interim Condensed Consolidated Statement of
Profit or Loss	23
Interim Condensed Consolidated Statement of
Comprehensive Income	24
Interim Condensed Consolidated Statement of
Financial Position	25
Interim Condensed Consolidated Statement of
Changes in Equity	27
Interim Condensed Consolidated Statement of Cash Flows	29
Notes to the Interim Condensed Consolidated
Financial Statements	31

China Shipping Container LineS Company Limited InterIm rePOrt 2016 1

Corporate InformatIon

DIreCtorS

EXECUTIVE DIRECTORS

Ms. Sun Yueying (Chairman) Mr. Wang Daxiong Mr. Liu Chong Mr. Xu Hui

NON-EXECUTIVE DIRECTORS

Mr. Yang Jigui Mr. Feng Boming Mr. Huang Jian

INDEPENDENT NON-EXECUTIVE DIRECTORS

Mr. Cai Hongping Mr. Tsang Hing Lun Ms. Hai Chi Yuet Mr. Graeme Jack

nomInatIon CommIttee

Ms. Hai Chi Yuet (Chairman) Ms. Sun Yueying Mr. Wang Daxiong Mr. Cai Hongping Mr. Tsang Hing Lun

remUneratIon CommIttee

Mr. Cai Hongping (Chairman) Mr. Wang Daxiong Mr. Graeme Jack

aUDIt CommIttee

Mr. Tsang Hing Lun (Chairman) Mr. Yang Jigui Mr. Cai Hongping

CHIef aCCoUntant

SUperVISorS

Mr. Ye Hongjun (Chairman) Mr. Hao Wenyi Mr. Gu Xu Ms. Zhang Weihua Mr. Zhu Donglin Mr. Fu Yi

InVeStment StrateGY CommIttee

Ms. Sun Yueying (Chairman) Mr. Wang Daxiong Mr. Liu Chong Mr. Feng Boming Mr. Huang Jian Mr. Cai Hongping Ms. Hai Chi Yuet

Mr. Zhang Mingwen

JoInt CompanY SeCretarIeS

Mr. Yu Zhen Ms. Ng Sau Mei

aUtHorISeD repreSentatIVeS

Mr. Wang Daxiong Mr. Yu Zhen

LeGaL aDDreSS In tHe prC

Room A-538, International Trade Center China (Shanghai) Pilot Free Trade Zone Shanghai The PRC

prInCIpaL pLaCe of BUSIneSS In tHe prC

628 Minsheng Road Pudong New Area Shanghai The PRC

China Shipping Container LineS Company Limited 2 InterIm rePOrt 2016

prInCIpaL pLaCe of BUSIneSS In HonG KonG

31/F, Tower 2 Kowloon Commerce Centre 51 Kwai Cheong Road Kwai Chung New Territories Hong Kong

CompanY WeBSIte

www.cscl.com.cn

H SHare LIStInG pLaCe

Main Board of The Stock Exchange of Hong Kong Limited (“Stock Exchange”)

LIStInG Date

InternatIonaL aUDItor

16 June 2004

Ernst & Young

nUmBer of H SHareS In ISSUe

DomeStIC aUDItor

3,751,000,000 H Shares

Baker Tilly China (Special General Partnership)

BoarD Lot

LeGaL aDVISer

1,000 shares

Clifford Chance (As to Hong Kong Laws) Zhong Lun Law Firm (As to PRC Laws)

HonG KonG H SHare reGIStrar anD tranSfer

StoCK eXCHanGe StoCK CoDe

02866

offICe

a SHare LIStInG pLaCe

Computershare Hong Kong Investor Services Limited 17th Floor, Hopewell Centre 183 Queen's Road East Hong Kong

Shanghai Stock Exchange

LIStInG Date

12 December 2007

prInCIpaL BanKerS

Bank of China Industrial and Commercial Bank of China Citibank China Merchants Bank Shanghai Pudong Development Bank Bank of Communications

nUmBer of a SHareS In ISSUe

7,932,125,000 A Shares

BoarD Lot

100 shares

SHanGHaI StoCK eXCHanGe StoCK CoDe

teLepHone nUmBer

601866

86 (21) 6596 6105

faX nUmBer

86 (21) 6596 6813

The Company is a registered non-Hong Kong company as defined in the Companies Ordinance (Chapter 622 of the Laws of Hong Kong) and it is registered under its Chinese name and under the English name “China Shipping Container Lines Company Limited”.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 3

reSULtS anD BUSIneSS HIGHLIGHtS UnDer HonG KonG fInanCIaL reportInG StanDarDS (“HKfrS”)

tanDarDS (“HKfrS”)
	1H 2016	1H 2015	Change
	*RMB*	RMB	(%)
	(Unaudited)	(Unaudited)
		(Restated)
Revenue	8,375,935,000	16,654,023,000	-49.7%
(Loss)/profit before income tax from	(735,906,000)	1,000,601,000	-173.6%
continuing operations
(Loss)/profit attributable to owners of the parent	(834,572,000)	831,116,000	-200.4%
Basic (loss)/earnings per share	(0.07)	0.07	-200.0%
Gross profit margin	6.09%	8.02%	-24.10%
Gearing ratio	4.76	0.89	434.8%

manaGement DISCUSSIon anD anaLYSIS

Completion of restructuring, disposal and purchase of assets:

1. DetaILS of reStrUCtUrInG:

1) Disposal of material assets

China Shipping Container Lines Company Limited (“Company” or “CSCL”) and its wholly-owned subsidiary China Shipping Container Lines (Hong Kong) Co., Ltd. (“CSCL HK”) disposed of the equity interests they held in 34 companies to the transferee designated by China COSCO Holdings Company Limited (“China COSCO”) as well as China Shipping Regional Holdings Pte. Ltd., a subsidiary of China Shipping (Group) Company (“CS Group”); and CSCL disposed of the 49% equity interests it held in China Shipping Ports Development Co., Ltd. to COSCO Pacific Limited.

2) purchase of material assets

CSCL purchased from CS Group, Guangzhou Maritime Transport (Group) Co., Ltd. (“CS Guangzhou”) and Shanghai Shipping (Group) Company the 100% equity interests they held in China Shipping Investment Co., Ltd., purchased from CS Group the 100% equity interests it held in China Shipping Leasing Co., Ltd. (“CS Leasing”), purchased from CS Group and CS Guangzhou the 40% equity interests they held in China Shipping Finance Company Limited, purchased from China Ocean Shipping (Group) Company the 13.67% equity interests it held in China Bohai Bank Co., Ltd. by means of capital increase in China Shipping Investment Co., Ltd., and subscribed for the 17.53% equity interests in COSCO Finance Co., Ltd. by means of capital increase.

CSCL, through its wholly-owned subsidiary CSCL HK, purchased from China Shipping (Hong Kong) Holdings Co., Limited the 100% equity interests it held in Dong Fang International Investment Limited, 100% equity interests it held in China Shipping Nauticgreen Holdings Company Limited (“CS Nauticgreen”) and 100% equity interests it held in Helen Insurance Brokers Limited, purchased from China COSCO (Hong Kong) Limited the 100% equity interests it held in Long Honour Investments Limited, and purchased from COSCO Pacific Limited the 100% equity interests it held in Florens Container Holdings Limited.

China Shipping Container LineS Company Limited InterIm rePOrt 2016

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As at 30 June 2016, the Company was finalising the payment and settlement procedures for its disposal of the 100% equity interests in China Shipping Container Lines Agency (Shenzhen) Co., Ltd. and 100% equity interests in Universal Logistics (Shenzhen) Co., Ltd. In addition, the acquisition of the 13.67% equity interests in China Bohai Bank Co., Ltd. involved in the material assets restructuring as well as the capital increase in COSCO Finance Co., Ltd. were pending approval from the relevant regulatory authorities.

Other than the abovementioned transactions, all the other disposal and purchase transactions involved in the material assets restructuring have been completed.

2. effeCt of reStrUCtUrInG

1) Changes in the Company's principal business

By virtue of the transaction, the Company had its business focus shifted from container liner operation to integrated financial services consisting of diversified leasing businesses such as vessel leasing, container leasing and non-shipping finance leasing. Upon completion of the transaction, the container leasing business of the Company ranked No.2 in the world, and its non-shipping finance leasing business would focus on the development of health care, education, energy, construction, industrial equipment and other finance leasing business. In addition to the diversified leasing business, the Company will focus on the development of other integrated financial services, with which the profitability and capital returns of the Company will be enhanced gradually and remain stable.

Following the transaction, the Company will take good advantage of its experience in the shipping industry as well as the existing resources of the financial service industry to promote the development of the emerging industries, optimize its business models and achieve the diversified development of its financial business. The Company will strive to establish an integrated financial services platform with leasing business such as vessel, container and non- shipping leasing as core and characterized by shipping finance.

2) effect of vessel and container leasing transactions on the Company

As at 30 June 2016, the Company operated a container fleet of 115 vessels, with a total capacity of 842,000 TEU, among which, 74 vessels were owned by the Company, with a total capacity of 582,000 TEU. In addition, the Company had 16 vessels under construction or to be delivered under charter. Upon completion of the transaction, the Company provided vessel leasing services to China COSCO. Such vessel leases will be provided as time charter in principle, and are all operating leases without any finance leases.

As at 30 June 2016, the Company had a stock of containers of about 3.5 million TEU. Upon completion of the restructuring, the Company provided container leasing services to the world-famous container shipping companies, including China COSCO. Following the restructuring and transformation, the Company will actively adjust its business strategies, and shift its business focus from container liner operation to leasing of shipping-related assets. Relatively long-term vessel leasing contracts (especially for larger vessels) can guarantee a stable cash flow. By virtue of (i) the Company's fleet and containers; (ii) the Company's rich experience and deep understanding of the shipping market accumulated over the long-term operation in the shipping industry; (iii) the overall penetration of China COSCO Shipping Corporation Limited (“China COSCO Shipping”), the Company's indirect controlling shareholder, in the shipping industry chain; and (iv) the long-term cooperation relationship between the Company and financial institutions such as banks, the Company will be able to carry out its shipping-related assets leasing business in a more professional and far-reaching manner, providing its customers with one-stop services such as vessel leasing, container leasing, crew management, vessel management and maintenance and logistics network, etc. The Company will concentrate on developing new customer groups in future, aiming to further disperse its operating risks and secure reasonable and stable returns on investment.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 5

anaLYSIS of operatInG enVIronment anD oUtLooK

1. maCroeConomIC ConDItIonS:

In the first half of 2016, the global economy saw a sluggish recovery amid weak demand as the economic situation remained complicated. According to the latest data published by the International Monetary Fund (“IMF”) on 19 July 2016, the global economy is expected to grow by 3.1% in 2016 and 3.4% in 2017, while the pickup in global economic activities would be even slower and development of emerging markets and developing economies would remain uneven. Overall, the world economy faces substantial downside risk.

China remains in a transitional phase characterized by efforts aimed at economic restructuring and growth stabilization as the economy shifts from a growth model dominated by foreign investment and manufacturing to one driven by consumption and services. According to the data published by the National Bureau of Statistics, during the first half of the year, China's GDP grew by 6.7% while national investment in fixed assets increased by 9.0% from the same period of last year, indicating a deceleration in growth pace; and total foreign trade import and export decreased by 3.3% from the same period of last year. While the domestic economy is gradually stabilizing, pressures and challenges still persist.

2. SHIppInG marKet:

Given the sluggish recovery in global economic and trading activities, the shipping market has remained in doldrums in 2016, with the imbalance between supply of and demand for shipping capacity persisting. In other words, the recovery of global shipping industry is still faltering. All the shipping market segments have been trending down continually since the financial crisis, with Baltic Dry Index (BDI) and China Containerized Freight Index (CCFI) both reaching record lows this year. According to Clarksons Research Services, the global container shipping volume may have grown to around 89.30 million TEU in the first half of the year, representing a slight increase of 0.5% as compared with the same period of last year, with the growth rate down sharply by 7.7 percentage points from the same period of last year.

3. VeSSeL anD ContaIner LeaSInG marKet

1) Industrial environment:

In the context of weak shipping demand and shipping capacity glut, the container vessel leasing market was in decline, leading to lower freight rates for all types of vessels.

Currently, China ranks No.2 in ship-building capacity in the world, though the shipping finance industry is still in the early stage of development, with great market potential. Meanwhile, national and local policies have been promulgated to encourage the development of shipping finance business. In the meantime, demand from shipping companies, ship-building companies and financial institutions has prepared objective conditions for the development of vessel leasing business: firstly, the shipping industry requires substantial investment as shipping companies have considerable needs for financing, and purchase of vessels represents the largest portion of costs for shipping companies; the costs of vessels play a vital role in the survival and growth of shipping companies; secondly, given the growing popularity of larger and more energy-efficient ships, it is urgent for shipping companies to adjust their fleet structure so as to accommodate market demands. Therefore, continual improvement in fleet structure has become a key factor dictating the survival and development of shipping companies.

During the first half of 2016, the overall operating environment of the container leasing industry appeared more challenging due to the downbeat business climate of the container shipping market, with prices and rental rates of new containers, leasing rates of dry cargo containers, and prices of used containers constantly declining on weak demand. Furthermore, an accelerated increase in the number of returned containers due to feeble demand has led to lower container lease rates among major container leasing companies, resulting in reduced revenue, while the sharp increase in container inventory also led to a substantial increase in operating costs.

China Shipping Container LineS Company Limited 6 InterIm rePOrt 2016

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The situation is expected to remain grim in the remainder of 2016 as the oversupply of containers will hardly be reversed in the short term, especially given the gradual emergence of consolidation among vessel owners and container leasing companies, respectively. However, the driving force that underpins steady growth of container demand remains strong: firstly, international trade and cargo transportation remains frequent, leading to stable demand from container shipping companies and end users for new containers; secondly, there is growing demand for special cargo containers with advanced features which can help provide proper transportation environment for different kinds of special goods so as to meet the special requirements for transport, safety and operating costs; thirdly, it has become a common practice for liner companies to adopt the slow-steaming strategy, which has somehow led to a low turnover of containers, thereby increasing demand for containers; and fourthly, the replacement of old containers with new ones and the increase in old container trade also created a lot of demand for new containers.

According to Drewry Maritime Research, the size of the global container market reached around 37.61 million TEU as of the end of 2015, of which the container leasing market accounted for about 47.5%, equivalent to approximately 17.88 million TEU. In 2015, due to feeble growth in global trade and falling demand, the global container market only increased by 3.8%, while the container leasing market managed to grow by 3.5%.

2) Competitive landscape:

In recent years, vessel leasing business has remained in a growth mode in both quantity and scale, making a strategic contribution to the development of the shipping industry. Vessel leasing business has become one of the top priorities in the construction of shipping centres across free trade zones (“FTZs”). With geographic advantages and policy support, FTZs will become important hubs for vessel leasing businesses in China. Riding on the opportunities linked to reform initiatives for FTZs, growth potential of the vessel leasing business is being unlocked at an accelerating pace. The vessel leasing business in China is undergoing rapid growth, making huge contribution to construction of high-end vessels and maritime engineering equipment, especially semi-submersible deepwater drilling platforms, self-elevating drilling platforms and container vessels with capacity of more than 10,000 TEU. At present, there are dozens of financial leasing companies involved in vessel leasing business in China and with the development of the business, China's vessel leasing industry will be elevated to a higher level of development.

CSCL HK had eight 13,500 TEU container vessels under construction, which are expected to be delivered in 2018.

CS Nauticgreen had four 64,000 DWT bulk cargo vessels and six 21,000 TEU container vessels under construction. Among them, two bulk cargo vessels have already been delivered, with another two expected to be delivered in the second half of 2016. The 21,000 TEU container vessels are the world's largest ultralarge container vessels in terms of dimension and capacity, which are expected to be delivered starting in 2018.

CS Leasing has a diverse fleet involved in the vessel leasing business, including 13 multi-purpose vessels, five oil/chemical ships, four oil tankers, four dredgers, one chemical tanker, one flat-top barge and one towing vessel.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 7

Florens (Tianjin) Finance Leasing Co., Ltd. had two vessels involved in the vessel leasing business, including a 57,500 DWT bulk cargo vessel and a 4,000-hp full-rotary tug vessel.

The container leasing industry is known for its relatively high market concentration as there are more than ten leading container leasing companies in the world, located mainly in the United States, Europe and China. According to a report published by Drewry Maritime Research, as of the end of 2015, the world's top ten leasing companies (in terms of TEU) accounted for 92.1% and the top four accounted for 53.3% of the total number of containers, with seven of the top ten container leasing companies owning more than 1 million TEU of containers each. As of 30 June 2016, the new Florens container fleet after consolidation boasted total capacity of about 3.5 million TEU, which is estimated to make up 17% – 19% of the container leasing market.

4. ContaIner manUfaCtUrInG marKet

1) Industrial environment:

Due to a sluggish recovery of the world economy and shipping market, the container manufacturing market remained stagnant, with container prices falling all the way down to record lows. From 2010 to 2015, the overall demand of the industry remained at about 2.5 to 3 million TEU, with overall production capacity far greater than demand, and capacity utilization less than 50%. The downturn in 2015 was extended to 2016, with demand shrinking further and container prices falling in a continual manner.

2) Competitive landscape:

According to the statistics, the global container production capacity is expected to be more than 6 million TEU, with China International Marine Containers (Group) Co., Ltd. (“CIMC”), Singamas Container, CXIC Group and Shanghai Universal accounting for more than 90% of the total capacity, which indicates overall industry overcapacity and intense market competition. Shanghai Universal, a subsidiary of the Company, owns three dry cargo container manufacturing facilities, with a market share of about 10%, ranking No.4 in the industry.

5. fInanCIaL LeaSInG marKet for non-SHIppInG InDUStrIeS

1) Industrial environment:

In recent years, the nation has promulgated a series of guiding opinions and favourable policies for promotion of healthy development of the financial leasing industry, which has been elevated to the strategic status of serving the real economy. This has promoted rapid development and innovation of the entire industry.

Against the background of overall economic downward cycle, premium assets are difficult to come by, this has further intensified competition in the sector. Since the beginning of the year, banks, trust and financial leasing companies have engaged in the sectors of medical services, education and financing platforms of the local governments, competition is increasingly keen as a result. On the other hand, however, penetration of financial leasing industry is still low in China; this means relatively huge potential for growth. With commencement of the 13th Five-Year-Plan, industrial upgrading and structural adjustments take place at quicker pace whereas urbanization and industrialization also proceed steadily. This brings about historic opportunities of development to the financial leasing industry, which is expected to develop at relatively high speed.

China Shipping Container LineS Company Limited 8 InterIm rePOrt 2016

2) Competitive landscape:

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In the domestic financial leasing industry, the main operators include financial leasing companies, domestically invested pilot leasing companies and foreign invested leasing companies. Financial leasing companies are mainly established by financial institutions such as banks and they are supervised by the China Banking Regulatory Commission. These companies have higher leverage ratios than the other two types, and much higher average contract balance and average total registered capital as well. In recent years, foreign invested leasing companies have grown tremendously in both total number of registration and total registered capital. In terms of financing leasing contract balance, the business share of these three types of leasing companies is 4:3:3.

CS Leasing is a domestically invested pilot leasing company with registered capital of RMB1.5 billion. In the two years of operation, it has developed considerable expertise in the market segments of shipping, medical services, education, energy, construction and industrial equipment. Its business is rapidly expanding in terms of scale.

6. CompanY'S CoUntermeaSUreS

1) market forecast for the second half of 2016

The inclement and complicated economic scenario persists concomitant with a number of uncertainties. The IMF has time and again adjusted downward its global economic forecast; the economy is estimated to grow at 3.1% this year. The Chinese economy is in the critical stage of intensified reformation and structural adjustment, with co-existence of low demand and overcapacity persisting, the pressure of economic downturn is still relatively great.

A series of national strategies are being implemented at an accelerated pace, ranging from the “One Belt One Road” strategy to construction of “the Yangtze River Economic Belt”; and from marine potestatem strategies to “Made in China 2025”. They all bring new strategic opportunities to CSCL for development of integrated financial services platform with shipping financial characteristics.

2) Company's strategic ideas, operation goals and plans

A. Strategic positioning

As the shipping financial platform, CSCL will integrate premium resources and give full play to its advantages in the shipping industry. Synergic development will be pursued for various financial businesses, in an attempt to become China's leading and the world's first-class business group boasting an integrated financial services platform with distinct shipping logistic features.

B. Goals of development

To give play to advantages in shipping logistics industry and integrate shipping industry chain with shipping finance as the foundation; to develop industrial cluster with leasing, investment, insurance and banking as the core; to develop into a “one-stop” financial services group by integrating industry and finance, combining finance with finance, and synergy of various businesses, with market mechanism, differentiated advantages and international vision.

C. Development plan

a. Leasing business

The container leasing business is an extension of the industry chain of container manufacturing, which will be mainly engaged in container leasing and trading of various kinds. The Company will strive to become an industry-leading leasing company with unique competitive edges on the basis of the current container leasing business of Florens and Dong Fang International. In a short-term view, the Company is to follow the guideline of “consolidating core businesses while seizing market opportunities” and take advantage of the business combination to realize synergy among sales, cost and capability, so as to consolidate its core business. In a long-term view, the Company is to seize market opportunities to develop its special container leasing business, optimize its contract patterns and improve capital structure, so as to increase returns.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 9

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The vessel leasing business will focus on the operating lease or finance lease of various vessels, such as container vessels and dry bulk cargo vessels. Upon completion of the transaction, the Company will be developing the vessel finance leasing as its core business on the basis of its existing shipping business. In a short-term view, CSCL is to mobilize its current fleet resources to revive its internal business; in the long run, it is to gradually increase the proportion of external business and workout a “one-stop” business model leveraging on China COSCO Shipping's advantages of full industrial chain deployment, in an attempt to establish a unique competitive edge in the industry.

The non-shipping leasing business will engage in various non-shipping leasing business while focusing on businesses of development potential such as medical services, education, new energy and intelligent manufacturing. The Company sets its focus on the SME clients and small projects, striving to become a finance leasing industry leader by leveraging on its existing business, experience and capital to promote combination of industry and finance. In the industrial sector, the Company will support customer-oriented development and provide financial leasing value-added services, establishing a leasing business platform offering onestop professional services with uniform standards.

b.

Investment business

The Company will devote itself to various financial and strategic investments such as those in the financial sector: utilizing various strategic investment opportunities and enhancing return on investment and the Company's overall return on capital; actively pursuing of investment opportunities in securities, funds, insurance, banking and trust and further expanding financial businesses through various means to achieving synergic effects and effectiveness; further enhancing cooperation with external investment institutions and actively participating in direct and indirect investment activities to form proprietary investment team progressively and provide asset allocation business for companies in the full industrial chain; pursuing flexible investment by leveraging the characteristics of strategic and financial investment and emphasizing company equities and other investments of considerable liquidity.

c.

Integrated financial services

To give play to the advantages of financial company based on the Company's and China COSCO Shipping's customer resources, and taking advantage of discovered values of supply chain customer flow, capital flow and information flow. Full support is given to China COSCO Shipping's “6+1” development strategy of industrial cluster, and integrate into industrial chain flow of China COSCO Shipping's members through construction of services platforms such as the “finance manager” to provide customized, differentiated and low-cost financial service products.

Upon restructuring and transformation, CSCL will boast the unique business model of “shipping + finance” which integrates its shipping and finance businesses and constitutes a bridge between real economy and capital market. CSCL's new unique status will enable the Company to leverage advantages of the real economy and capital market for realization of higher operation efficiency and optimization of financial indicators. Covering the full shipping industry chain, the new CSCL can provide companies in the upper and lower streams with one-stop financial services and solutions to enhance utilization rate and loyalty of customers. By keeping abreast with the sectoral development, resources can be used and deployed more effectively besides better management and precise control of the risks faced by the financial business.

China Shipping Container LineS Company Limited 10 InterIm rePOrt 2016

anaLYSIS of SeGment reSULtS of tHe GroUp

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The Group recorded a revenue of RMB8,375,935,000, representing a decrease of 50% as compared with the restated revenue of RMB16,654,023,000 for the same period of last year; total loss before income tax from continuing operations amounted to RMB735,906,000, representing a decrease of 174% as compared with the restated profit of RMB1,000,601,000 for the same period of last year; net loss attributable to shareholders of the parent amounted to RMB834,572,000, representing a decrease of 200% as compared with the restated profit of RMB831,116,000 for the same period of last year. Due to the downturn of the shipping market, the Company's liner operations had suffered significant losses during January to February prior to the completion of the restructuring.

Analyses of segment results are as follows:

1. anaLYSIS of reVenUe anD CoStS from LIner operatIonS

1) operating revenue

The shipping business recorded a revenue of RMB3,235,222,000, representing a decrease of 76% as compared with the restated revenue of RMB13,598,797,000 for the same period of last year, accounting for 39% of the total revenue of the Group. The Group accomplished a loaded container volume of 1,059,103 TEU for this Period, representing a decrease of 73% as compared with the restated volume of 3,991,098 TEU for the same period of last year. Such decrease is mainly due to that CSCL ceased to be engaged in the container liner operations following the restructuring and transformation, with its revenue from the shipping business for the year all coming from operations during January to February prior to completion of the transaction.

2) operating Costs

Total operating costs of the shipping business amounted to RMB4,124,859,000, representing a decrease of 69% as compared with the restated costs of RMB13,310,989,000 for the same period of last year, mainly due to that CSCL ceased to be engaged in the container liner operations following the restructuring and transformation, with its operating costs from the shipping business for the year all coming from operations during January to February prior to completion of the transaction.

2. anaLYSIS of reVenUe anD CoStS from SHIppInG-reLateD LeaSInG BUSIneSS

1) operating revenue

The Group recorded a revenue from its shipping-related leasing business of RMB4,151,288,000 for the first half of 2016, representing an increase of 119% as compared with the restated revenue of RMB1,898,409,000 for the same period of last year, accounting for 50% of the total revenue of the Group. Such increase is mainly due to the Company starting to lease out all its self-owned vessels since March this year.

Revenue from container leasing, management and sales amounted to RMB1,536,148,000, representing an increase of 18% as compared with the restated revenue of RMB1,296,640,000 for the same period of last year, including revenue from container leasing and sales of the returned containers upon expiry. The Group recorded a revenue from its container leasing business of RMB1,413,455,000 for the first half of 2016, representing an increase of 14% as compared with the restated revenue of RMB1,239,060,000 for the same period of last year, mainly due to the increase in the number of containers the Company owned and leased back after sales by 21% to 2,661,635 TEU (31 December 2015: 2,197,149 TEU). As for the container sales business, the revenue from sales of containers returned upon expiry amounted to RMB122,693,000, representing an increase of 113% as compared with the restated revenue of RMB57,580,000 for the same period of last year, mainly due to the increase in the number of containers returned upon expiry.

Revenue from vessel leasing business amounted to RMB2,615,140,000 for the first half of 2016, representing an increase of 335% as compared with the restated revenue of RMB601,769,000 for the same period of last year. In the first half of 2016, the Group had a total of 119 vessels leased out.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 11

2) operating Costs

Operating costs for leasing business include the depreciation and maintenance costs for self-owned vessels, depreciation of self-owned containers, staff salaries, net carrying value of sales of containers returned upon expiry and rents of the leased-in vessels and containers. Operating costs for the first half of 2016 was RMB3,231,326,000, representing an increase of 197% as compared with the restated costs of RMB1,087,705,000 for the same period of last year, mainly due to the following reasons:

As CSCL leased out all its self-owned vessels following the restructuring and transformation, the leasing costs rose significantly. Leasing costs include vessel rents, depreciation costs, labour costs and repair costs. The increase in container leasing costs was mainly due to the increase in depreciation as a result of the decrease in the residual value of the containers.

3. anaLYSIS of reVenUe anD CoStS from ContaIner manUfaCtUrInG BUSIneSS

1) operating revenue

The Group's ordinary dry cargo container business realized operating revenue of RMB475,663,000 in the first half of 2016, representing a decrease of 44% as compared with the restated revenue of RMB848,195,000 for the same period of last year. The decline in revenue from the ordinary dry cargo container business was mainly due to decreased demand from shipping companies for containers in the first half of 2016. The Group's container sales amounted to 54,000 TEU during the Period, representing a decrease of 11% as compared with the restated sales of 61,000 TEU for the same period of last year.

2) operating Costs

The operating costs of the container manufacturing business mainly consist of raw material costs, employee compensation and depreciation expenses. The operating costs of the business amounted to RMB403,708,000 in the first half of 2016, representing a decrease of 54% as compared with the restated operating costs of RMB878,770,000 for the same period of last year.

4. anaLYSIS of reVenUe anD CoStS from non-SHIppInG fInanCIaL LeaSInG BUSIneSS

1) operating revenue

The Group's non-shipping financial leasing business realized operating revenue of RMB349,055,000 in the first half of 2016, representing an increase of 419% as compared with the restated revenue of RMB67,243,000 for the same period of last year. The business accounted for 4% of the Group's total revenue in the Period. The strong growth in revenue from the non-shipping financial leasing business was mainly driven by a rapid expansion in financial leasing services after the Group's subsidiary CS Leasing commenced operations in the first half of 2015.

2) operating Costs

The operating costs of the non-shipping financial leasing business mainly consist of interest expenses. The operating costs of the business amounted to RMB82,541,000 in the first half of 2016, representing an increase of 1,108% as compared with the restated operating costs of RMB6,832,000 for the same period of last year. The sharp increase in the operating costs was mainly driven by a rapid expansion in loans borrowed by CS Leasing after it commenced operations in the first half of 2015.

China Shipping Container LineS Company Limited 12 InterIm rePOrt 2016

performanCe of aSSoCIateD CompanIeS HeLD BY tHe GroUp

CImC

During the first half of 2016, CIMC realized operating revenue of RMB23,542,843,000, representing a decrease of 27.87% as compared with RMB32,637,289,000 recorded in the same period of last year; net loss attributable to shareholders of the parent company of RMB378,034,000, representing a decrease of 124.90% as compared to net profit of RMB1,518,195,000 in the same period of last year; and basic loss per share of RMB0.1444, compared to earnings per share of RMB0.5681 recorded in the same period of last year. During the reporting period, its container business, road transportation vehicle business, logistics services, airport business, energy, chemicals and liquid food business, and marine engineering business all saw declines in profit, while its finance and real estate business realized profit growth.

LIQUIDItY, fInanCIaL reSoUrCeS anD CapItaL StrUCtUre

1. LIQUIDItY anD BorroWInGS

The Group's principal sources of liquidity are operating cash inflow and short-term bank borrowings. The Group's cash is mainly used for operating expenses, repayment of loans, construction of new vessels, procurement of containers, and the Group's financial leasing business. During the Period, the Group's net operating cash inflow was RMB5,161,809,000. As at 30 June 2016, the Group's cash balance in banks was RMB14,829,828,000.

As at 30 June 2016, the Group's total bank borrowings were RMB44,231,622,000. The maturity profile is spread over a period between 2016 to 2027, with RMB14,234,709,000 repayable within one year, RMB9,550,453,000 repayable within the second year, RMB16,629,913,000 repayable within the third to the fifth year, and RMB3,816,548,000 repayable after the fifth year. The Group's long-term bank borrowings are mainly used to finance the construction of vessels, procurement of containers, and equity acquisitions.

As at 30 June 2016, the Group's long-term bank borrowings were secured by mortgages over certain containers and vessels with total book value of RMB35,511,010,000.

As at 30 June 2016, the Group's 10-year RMB-denominated bonds payable amounted to RMB1,797,658,000, and all proceeds raised from the bonds were used for construction of vessels. The issuance of such bonds is guaranteed by Shanghai Branch of Bank of China.

In addition, the Group's fixed term USD-denominated bonds payable amounted to USD264,112,000 (equivalent to RMB1,751,377,000), and all proceeds raised from the bonds were used for procurement of containers.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 13

==> picture [253 x 125] intentionally omitted <==

The Group's RMB borrowings at fixed interest rates amounted to RMB7,382,096,000. USD borrowings at fixed interest rates amounted to USD480,255,000 (equivalent to RMB3,184,664,000) and USD borrowings at floating interest rates amounted to USD5,076,737,000 (equivalent to RMB33,664,861,000). The Group's borrowings are settled in RMB or US dollars while its cash and cash equivalents are also primarily denominated in RMB and US dollars.

It is expected that capital needs for regular cash flow and capital expenditure can be funded by the internal cash flow of the Group or external financing. The board of directors of the Company (“Board”) will review the operating cash flow of the Group from time to time. It is the intention of the Group to maintain an appropriate composition of equity and debt to constantly achieve an effective capital structure.

2. GearInG ratIo

As at 30 June 2016, the gearing ratio of the Group (i.e., the ratio of net interest-bearing financial liabilities less cash and cash equivalents over total equity) was 476%, which is higher than that of 89% as at 31 December 2015. The increase was primarily due to the completion of its acquisitions of subsidiaries at a premium during the six months ended 30 June 2016 (“Period”).

3. foreIGn eXCHanGe rISK

Revenues and costs of the Group's liner services, shipping-related leasing business, and container manufacturing operations are settled or denominated in US dollars. As a result, the impact on the net operating revenue due to RMB exchange rate fluctuation can be offset by each other to a certain extent. During the Period, the Group recorded a net exchange loss of RMB49,945,000 which was mainly due to fluctuations of the US dollar and Euro exchange rates and the exchange difference which was charged to equity attributable to shareholders of the parent amounted to RMB235,255,000. The Group will continue to monitor the exchange rate fluctuation of RMB and major international currencies, minimize the loss arising from exchange rate fluctuation, and take appropriate measures to mitigate the Group's foreign exchange exposure when necessary.

4. CapItaL CommItment

As at 30 June 2016, the Group had RMB10,654,848,000 in capital commitments which had been contracted but not provided for and which had been authorised by the Board but not contracted for, in relation to vessels under construction. Furthermore, the Group had RMB24,802,000 in capital commitments which had been contracted but not provided for and which had been authorised by the Board but not contracted for, in relation to procurement of containers. The equity investment commitment for the Period was RMB1,575,000,000.

China Shipping Container LineS Company Limited 14 InterIm rePOrt 2016

SUBSeQUent eVentS

==> picture [254 x 125] intentionally omitted <==

There is no material subsequent event undertaken by the Group after 30 June 2016.

ContInGent LIaBILItY

As at 30 June 2016, the Group had a provision of RMB25,000,000 for legal claims. The provision was related to legal claims brought against the Group by customers of the Group. After taking appropriate legal advice, the Board is of the view that the outcome of the legal claims should not give rise to any significant loss beyond the amounts provided for as at 30 June 2016.

empLoYeeS, traInInG anD BenefItS

As at 30 June 2016, the Group had 7,223 employees (of which 5,105 were outsourced labour employees), and the total staff costs for the Period (including staff remuneration, welfare and social insurance, etc.) amounted to approximately RMB856,211,400 (including outsourced labour costs).

Remuneration of the Group's employees includes basic salaries, other allowances and performance-based bonuses. The Group has also adopted a performance-based discretionary incentive scheme for its employees. The scheme links the employees' financial benefits directly with certain business performance indicators. Such indicators may include, but not limited to, profit target of the Group.

Details of such performance-based discretionary incentive scheme vary among the employees of the Group. The Group sets out certain performance indicators for each subsidiary to achieve. Each subsidiary has the discretion to formulate in detail its own performance-based remuneration policies according to its own circumstances.

The Group has put in place various trainings for its staff, including Safety Management Systems (SMS) training for the crewing department as well as management training for mid-to-high level management staff.

As at 30 June 2016, the Group did not implement any equity incentive scheme.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 15

SHare CapItaL

As at 30 June 2016, the share capital of the Company was as follows:

	number of
types of shares	issued shares	percentage
		(%)
A Shares	7,932,125,000	67.89
H Shares	3,751,000,000	32.11
Total	11,683,125,000	100.00

IntereStS or SHort poSItIonS of DIreCtorS, SUperVISorS anD CHIef eXeCUtIVeS In SHareS, UnDerLYInG SHareS anD DeBentUreS

As at 30 June 2016, none of the Directors, supervisors or chief executive(s) of the Company had any interests or short positions in the shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which any such Directors, supervisors or chief executive(s) were taken or deemed to have taken under such provisions of the SFO) or which were required to be entered in the register required to be kept by the Company pursuant to Section 352 of the SFO or which were otherwise required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (“Model Code”) adopted by the Company.

China Shipping Container LineS Company Limited 16 InterIm rePOrt 2016

IntereStS or SHort poSItIonS of SUBStantIaL SHareHoLDerS or otHer perSonS In tHe SHareS or UnDerLYInG SHareS

As at 30 June 2016, so far as was known to the Directors, Supervisors or chief executive(s) of the Company, the interests or short positions of the shareholders who are entitled to exercise or control 5% or more of the voting power at any general meeting or other persons (other than a Director, supervisor or chief executive(s) of the Company) in the shares or underlying shares of the Company which were required to be notified to the Company pursuant to Divisions 2 and 3 of Part XV of the SFO, or which were required to be recorded in the register kept by the Company pursuant to Section 336 of the SFO or which have been notified to the Company and the Stock Exchange were as follows:

		number of shares/		percentage in the	percentage in
	types of	underlying		relevant class of	total share
name of shareholder	shares	shares held	Capacity	share capital	capital
				(%)	(%)
China Shipping (Group) Company	A Shares	4,458,195,175(L)(1)	Beneficial owner	56.20	38.16
China COSCO Shipping Corporation	A Shares	4,458,195,175(L)(1)	Interest of controlled	56.20	38.16
Limited			corporation
The Northern Trust Company (ALA)	H Shares	249,945,900(P)	Approved lending agent	6.66	2.14

(L) – Long position, (P) – Lending pool

Note:

Such 4,458,195,175 shares represent the same block of shares.

Save as disclosed above, as at 30 June 2016, no other person (other than Directors, supervisors or chief executive(s) of the Company) had any interests or short positions in any shares or underlying shares of the Company which would fall to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or any interests or short positions recorded in the register kept by the Company pursuant to Section 336 of the SFO or any interests or short positions which have been notified to the Company and the Stock Exchange.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 17

CHanGeS In InformatIon of DIreCtorS or SUperVISorS

Pursuant to Rule 13.51B(1) of the Listing Rules, changes in the information of Directors or supervisors of the Company subsequent to the date of its 2015 Annual Report were as follows:

DIreCtorS, SUperVISorS – DetaILS of CHanGeS

name	position	Change	reason of change
Sun Yueying	Executive Director	elected to be in office	Re-election of the Board
	Chairman	elected to be in office	Approved at the 1st meeting
			of the fifth session of the
			Board
Wang Daxiong	Executive Director	elected to be in office	Re-election of the Board
	Chief executive officer	appointed	Approved at the 43rd meeting
			of the fourth session of the
			Board
Liu Chong	Executive Director	elected to be in office	Re-election of the Board
Xu Hui	Executive Director	elected to be in office	Re-election of the Board
	Deputy general manager	appointed	Approved at the 46th meeting
			of the fourth session of the
			Board
Feng Boming	Non-executive Director	elected to be in office	Re-election of the Board

China Shipping Container LineS Company Limited 18 InterIm rePOrt 2016

==> picture [254 x 125] intentionally omitted <==

name position Change reason of change Huang Jian Non-executive Director elected to be in office Re-election of the Board Cai Hongping Independent non-executive Director elected to be in office Re-election of the Board Tsang Hing Lun Independent non-executive Director elected to be in office Re-election of the Board Hao Wenyi Supervisor elected to be in office Re-election of the supervisory committee Fu Yi Employee representative supervisor elected to be in office Re-election of the supervisory committee Gu Xu Independent supervisor elected to be in office Re-election of the supervisory committee Zhang Weihua Independent supervisor elected to be in office Re-election of the supervisory committee Zhang Guofa Executive Director, Chairman ceased to be in office Approved at the 43rd meeting of the fourth session of the Board Zhao Hongzhou Executive Director ceased to be in office Approved at the 43rd meeting of the fourth session of the Board General manager ceased to be in office Approved at the 43rd meeting of the fourth session of the Board Yu Zenggang Non-executive Director ceased to be in office Re-election of the Board

China Shipping Container LineS Company Limited InterIm rePOrt 2016 19

name	position		Change	reason of change
Han Jun	Non-executive Director		ceased to be in office	Re-election of the Board
Zhang Nan Independent non-executive Director			ceased to be in office	Re-election of the Board
Guan Yimin Independent non-executive Director			ceased to be in office	Re-election of the Board
Shi Xin	Independent non-executive Director		ceased to be in office	Re-election of the Board
Xu Wenrong Chairman of supervisory committee			ceased to be in office	Re-election of the supervisory
				committee
Zhong Lu Employee representative supervisor			ceased to be in office	Re-election of the supervisory
				committee
Shen Kangchen Independent supervisor			ceased to be in office	Re-election of the supervisory
				committee
Qian Weizhong Deputy general		manager	ceased to be in office	Approved at the 43rd meeting
				of the fourth session of the
				Board
Chen Wei Deputy general		manager	ceased to be in office	Approved at the 43rd meeting
				of the fourth session of the
				Board
Sui Jun	Deputy general	manager	ceased to be in office	Approved at the 43rd meeting
				of the fourth session of the
				Board
Chen Shuai Deputy general		manager	ceased to be in office	Approved at the 43rd meeting
				of the fourth session of the
				Board
Gu Zhongdong Deputy general		manager	ceased to be in office	Approved at the 43rd meeting
				of the fourth session of the
				Board
Huang Xiaowen Deputy chairman, executive Director			ceased to be in office	Re-election of the board
Chen Jihong Non-executive Director			ceased to be in office	Re-election of the board
Ding Nong Non-executive Director			ceased to be in office	Re-election of the board

China Shipping Container LineS Company Limited 20 InterIm rePOrt 2016

pUrCHaSe, SaLe or reDemptIon of LISteD SeCUrItIeS of tHe CompanY

During the Period, neither the Company nor any of its subsidiaries had purchased, sold or redeemed any of the listed securities of the Company.

InterIm DIVIDenD

The Board does not recommend distribution of an interim dividend for the Period (2015: nil).

aUDIt CommIttee

The Board has set up an audit committee which consists of two independent non-executive Directors, namely Mr. Tsang Hing Lun and Mr. Cai Hongping, and one non-executive Director, namely Mr. Yang Jigui. The audit committee has reviewed the Company's interim results for the Period and agreed with the accounting treatment adopted by the Company.

Corporate GoVernanCe CoDe

The Company was in compliance with all the code provisions of the “Corporate Governance Code” set out in Appendix 14 to the Rules Governing the Listing of Securities on the Stock Exchange (the “Listing Rules”) during the Period.

moDeL CoDe for SeCUrItIeS tranSaCtIonS

The Company has adopted a code of conduct regarding Directors', supervisors' and relevant employees' securities transactions on terms no less exacting than the required standard set out in the Model Code as set out in Appendix 10 to the Listing Rules. Following specific enquiry made with all the Directors and supervisors of the Company, each of them has confirmed that he/she has complied with the required standard set out in the Model Code regarding directors' and supervisors' securities transactions during the Period. The Company is not aware of any non-compliance with these guidelines by the relevant employees.

By order of the Board China Shipping Container Lines Company Limited Sun Yueying Chairman

Shanghai, the PRC 30 August 2016

China Shipping Container LineS Company Limited InterIm rePOrt 2016 21

report on reVIeW of InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS to tHe memBerS of CHIna SHIppInG ContaIner LIneS CompanY LImIteD

(Incorporated in the People’s Republic of China with limited liability)

IntroDUCtIon

We have reviewed the accompanying interim condensed consolidated financial statements set out on pages 23 to 68 which comprise the interim condensed consolidated statement of financial position of China Shipping Container Lines Company Limited (the “Company”) and its subsidiaries (collectively referred to as the “Group”) as at 30 June 2016 and the related interim condensed consolidated statement of profit or loss, the interim condensed consolidated statement of comprehensive income, changes in equity and cash flows for the six-month period then ended, and certain explanatory notes. The Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited require the preparation of a report on interim condensed consolidated financial statements to be in compliance with the relevant provisions thereof and Hong Kong Accounting Standard 34 Interim Financial Reporting (“HKAS 34”) issued by the Hong Kong Institute of Certified Public Accountants.

The directors are responsible for the preparation and presentation of these interim condensed consolidated financial statements in accordance with HKAS 34. Our responsibility is to express a conclusion on these interim condensed consolidated financial statements based on our review. Our report is made solely to you, as a body, in accordance with our agreed terms of engagement, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of this report.

SCope of reVIeW

We conducted our review in accordance with Hong Kong Standard on Review Engagements 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Hong Kong Institute of Certified Public Accountants. A review of interim condensed consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

ConCLUSIon

Based on our review, nothing has come to our attention that causes us to believe that the interim condensed consolidated financial statements are not prepared, in all material respects, in accordance with HKAS 34.

ernst & Young

Certified Public Accountants

Hong Kong 30 August 2016

China Shipping Container LineS Company Limited 22 InterIm rePOrt 2016

InterIm ConDenSeD ConSoLIDateD Statement of profIt or LoSS

FOR THE SIX MONTHS ENDED 30 JUNE 2016

		for tHe SIX montHS enDeD	for tHe SIX montHS enDeD
		30 JUne
		2016	2015
	Notes	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
ContInUInG operatIonS
reVenUe	3	8,375,935	16,654,023
Cost of sales		(7,866,192)	(15,318,713)
Gross profit		509,743	1,335,310
Selling, administrative and general expenses		(631,923)	(641,619)
Other income	4	73,235	220,240
Other gains, net	5	130,251	76,760
operating profit		81,306	990,691
Finance costs	6	(686,916)	(425,782)
Share of (losses)/profits of:
Associates		(135,784)	434,235
Joint ventures		5,488	1,457
(Loss)/profit before income tax from continuing operations		(735,906)	1,000,601
Income tax expense	7	(80,806)	(121,335)
(Loss)/profit for the period from continuing operations		(816,712)	879,266
DISContInUeD operatIon
Profit for the period from discontinued operation	8	9,772	9,419
(LoSS)/profIt for tHe perIoD		(806,940)	888,685
attributable to:
Owner of the parent		(834,572)	831,116
Non-controlling interests		27,632	57,569
		(806,940)	888,685
(LoSS)/earnInGS per SHare attrIBUtaBLe to orDInarY
eQUItY HoLDerS of tHe parent
(express in RMB per share)	9
Basic and diluted
– For (loss)/profit for the period		(0.07)	0.07
– For (loss)/profit for the period from continuing operations		(0.07)	0.07

China Shipping Container LineS Company Limited InterIm rePOrt 2016 23

InterIm ConDenSeD ConSoLIDateD Statement of CompreHenSIVe InCome

FOR THE SIX MONTHS ENDED 30 JUNE 2016

	for tHe SIX montHS enDeD	for tHe SIX montHS enDeD
	30 JUne
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
(LoSS)/profIt for tHe perIoD	(806,940)	888,685
otHer CompreHenSIVe InCome
Other comprehensive (loss)/income to be reclassified to
profit or loss in subsequent periods:
Change in fair value of available-for-sale investments, net of tax	(95,567)	66,473
Cash flow hedges:
Effective portion of changes in fair value of hedging
instruments arising during the period	(32,196)	(521)
Exchange differences on translation of foreign operations	(239,616)	(10,190)
Share of other comprehensive income of associates	34,242	(1,927)
otHer CompreHenSIVe (LoSS)/InCome for tHe perIoD, net of taX	(333,137)	53,835
totaL CompreHenSIVe (LoSS)/InCome for tHe perIoD	(1,140,077)	942,520
attributable to:
Owner of the parent	(1,158,892)	883,826
Non-controlling interests	18,815	58,694
	(1,140,077)	942,520

China Shipping Container LineS Company Limited 24 InterIm rePOrt 2016

InterIm ConDenSeD ConSoLIDateD Statement of fInanCIaL poSItIon

30 JUNE 2016
		30 June 2016	31 December 2015
	Notes	*RMB’000*		RMB’000
		(Unaudited)		(Unaudited)
				(Restated)
non-CUrrent aSSetS
Property, plant and equipment	11	58,116,231		56,642,656
Investment properties		8,005		10,087
Prepaid land lease payments		214,412		214,396
Intangible assets		23,440		30,738
Investments in associates	12	8,710,052		12,002,322
Investments in joint ventures		134,305		56,243
Available-for-sale investments	13	1,557,118		1,349,915
Finance lease receivables	14	9,023,724		5,680,658
Loans and receivables	15	207,413		368,467
Deferred tax assets		85,631		56,340
Other long term prepayments		28,050		34,721
total non-current assets		78,108,381		76,446,543
CUrrent aSSetS
Inventories		590,211		1,238,768
Trade and notes receivables	16	1,720,328		2,688,106
Prepayments and other receivables		2,034,622		1,865,156
Prepaid land lease payments		3,904		3,897
Finance lease receivables	14	2,142,961		1,682,327
Loans and receivables	15	1,830,739		3,133,055
Held-for-trading investments		21,668		200,349
Restricted cash	17	864,547		922,268
Cash and cash equivalents	17	13,965,281		15,860,939
		23,174,261		27,594,865
Assets of a disposal group classified as held for sale	8	11,036		–
total current assets		23,185,297		27,594,865
total assets		101,293,678		104,041,408
eQUItY
equity attributable to owners of the parent
Share capital		11,683,125		11,683,125
Special reserves		4,817		21,090
General reserves	18	93,356		65,504
Other reserves		(97,032)		21,606,867
Retained profits		2,133,734		3,207,032
		13,818,000		36,583,618
non-controlling interests		328,925		497,549
total equity		14,146,925		37,081,167

China Shipping Container LineS Company Limited InterIm rePOrt 2016 25

InterIm ConDenSeD ConSoLIDateD Statement of fInanCIaL poSItIon (Continued) 30 JUNE 2016

		30 June 2016	31 December 2015
	Notes	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
non-CUrrent LIaBILItIeS
Bank and other borrowings	19	41,779,529	25,349,767
Corporate bonds	20	1,506,225	3,449,494
Deposits from customers	21	8,951	8,900
Derivative financial instruments		27,044	691
Deferred tax liabilities		248,178	280,968
Other long term payables	22	701,370	405,129
total non-current liabilities		44,271,297	29,494,949
CUrrent LIaBILItIeS
Trade and notes payables		2,291,539	4,041,654
Other payables and accruals		1,176,093	1,723,336
Bank and other borrowings	19	29,344,629	26,818,843
Corporate bonds	20	2,042,810	245,617
Finance lease obligations		–	141
Deposits from customers	21	7,821,837	4,482,658
Derivative financial instruments		6,345	147
Tax payable		100,268	127,896
Provisions		25,000	25,000
		42,808,521	37,465,292
Liabilities directly associated with assets classified as held for sale	8	66,935	–
total current liabilities		42,875,456	37,465,292
total liabilities		87,146,753	66,960,241
total equity and liabilities		101,293,678	104,041,408
net CUrrent LIaBILItIeS		(19,690,159)	(9,870,427)
totaL aSSetS LeSS CUrrent LIaBILItIeS		58,418,222	66,576,116

Director

China Shipping Container LineS Company Limited 26 InterIm rePOrt 2016

InterIm ConDenSeD ConSoLIDateD Statement of CHanGeS In eQUItY

FOR THE SIX MONTHS ENDED 30 JUNE 2016

Notes at 1 January 2016 as previously reported Effect of merger accounting 2.2	attributable to owners of the parent Share capital Special reserves General reserves other reserves (accumulated losses)/ retained profits total non- controlling interests total equity *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* (note 19) 11,683,125 19,030 – 17,206,241 (6,734,162) 22,174,234 63,096 22,237,330 – 2,060 65,504 4,400,626 9,941,194 14,409,384 434,453 14,843,837
at 1 January 2016 (restated and unaudited) (Loss)/profit for the period Other comprehensive (loss)/income for the period: Change in fair value of available for-sale investments, net of tax Cash flow hedges, net of tax Exchange differences on translation of foreign operations Share of other comprehensive income of associates	11,683,125 21,090 65,504 21,606,867 3,207,032 36,583,618 497,549 37,081,167 – – – – (834,572) (834,572) 27,632 (806,940) – – – (91,111) – (91,111) (4,456) (95,567) – – – (32,196) – (32,196) – (32,196) – – – (235,255) – (235,255) (4,361) (239,616) – – – 34,242 – 34,242 – 34,242
total comprehensive (loss)/income for the period Acquisition of subsidiaries under common control 2.2 Disposal of subsidiaries 23 Dividend paid to previous shareholders of acquired subsidiaries under common control Dividend paid to non-controlling shareholders Transfer from retained profits Accrual of special reserves Utilisation of special reserves Other	– – – (324,320) (834,572) (1,158,892) 18,815 (1,140,077) – – – (21,381,010) – (21,381,010) – (21,381,010) – (22,548) – 1,431 22,548 1,431 (65,180) (63,749) – – – – (227,055) (227,055) – (227,055) – – – – – – (122,190) (122,190) – – 27,852 – (27,852) – – – – 77,897 – – (77,897) – – – – (71,622) – – 71,622 – – – – – – – (92) (92) (69) (161)
at 30 June 2016 (Unaudited)	11,683,125 4,817 93,356 (97,032) 2,133,734 13,818,000 328,925 14,146,925

China Shipping Container LineS Company Limited InterIm rePOrt 2016 27

InterIm ConDenSeD ConSoLIDateD Statement of CHanGeS In eQUItY (Continued) FOR THE SIX MONTHS ENDED 30 JUNE 2016

Notes At 1 January 2015 as previously reported Effect of merger accounting 2.2	Attributable to owners of the parent Share capital Special reserves General reserves Other reserves (Accumulated losses)/ retained profits Total Non- controlling interests Total equity RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (note 19) 11,683,125 20,150 – 16,873,604 (3,784,442) 24,792,437 85,046 24,877,483 – 1,130 52,339 3,019,035 9,486,528 12,559,032 417,629 12,976,661
At 1 January 2015 (Restated and unaudited) Profit for the period Other comprehensive income/(loss) for the period: Change in fair value of available for-sale investments, net of tax Cash flow hedges, net of tax Exchange differences on translation of foreign operations Share of capital reserve of associates	11,683,125 21,280 52,339 19,892,639 5,702,086 37,351,469 502,675 37,854,144 – – – – 831,116 831,116 57,569 888,685 – – – 65,337 – 65,337 1,136 66,473 – – – (521) – (521) – (521) – – – (10,179) – (10,179) (11) (10,190) – – – (1,927) – (1,927) – (1,927)
Total comprehensive income for the period Disposal of subsidiaries 23 Capital injection from previous shareholders of acquired subsidiaries under common control Dividend paid to previous shareholders of acquired subsidiaries under common control Dividend declared to non-controlling shareholders Accrual of special reserves Utilisation of special reserves Others	– – – 52,710 831,116 883,826 58,694 942,520 – – – (58,272) (397,216) (455,488) – (455,488) – – – 320,000 – 320,000 – 320,000 – – – – (67,050) (67,050) – (67,050) – – – – – – (54,850) (54,850) – 91,447 – – (91,447) – – – – (94,019) – – 94,019 – – – – – – – (511) (511) 228 (283)
At 30 June 2015 (Restated and unaudited)	11,683,125 18,708 52,339 20,207,077 6,070,997 38,032,246 506,747 38,538,993

China Shipping Container LineS Company Limited 28 InterIm rePOrt 2016

InterIm ConDenSeD ConSoLIDateD Statement of CaSH fLoWS

FOR THE SIX MONTHS ENDED 30 JUNE 2016

		for tHe SIX montHS enDeD	for tHe SIX montHS enDeD
		30 JUne
		2016	2015
	Notes	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
CaSH fLoWS from operatInG aCtIVItIeS
Cash generated from operations		5,167,994	1,136,164
Income tax paid		(6,185)	(84,673)
Net cash generated from operating activities		5,161,809	1,051,491
CaSH fLoWS from InVeStInG aCtIVItIeS
Interest received		44,392	79,658
Dividends received from associates		15,356	64,030
Dividends received from joint ventures		312	–
Dividends received from available-for-sale investments		954	44,252
Dividends received from held-for-trading investments		58,581	961
Purchase of items of property, plant and equipment		(5,879,447)	(5,816,165)
Proceeds from disposal of items of property,
plant and equipment and intangible assets		745,064	107,739
Purchase of equity in an associate		–	(320,000)
Purchase of equity in a joint venture		(125,000)	–
Purchase of available-for-sale investments		(700,329)	(624,374)
Purchase of held-for-trading investments		–	(110,215)
Prepayment for an investment		(225,000)	–
Disposal of subsidiaries	23	(349,884)	(8,005)
Disposal of associates		3,954,920	–
Disposal of joint ventures		54,602	–
Disposal of available-for-sale investments		216,345	406,253
Disposal of held-for-trading investments		200,008	290,218
Net cash used in investing activities		(1,989,126)	(5,885,648)

China Shipping Container LineS Company Limited InterIm rePOrt 2016 29

InterIm ConDenSeD ConSoLIDateD Statement of CaSH fLoWS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

		for tHe SIX montHS enDeD	for tHe SIX montHS enDeD
		30 JUne
		2016	2015
	Notes	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
CaSH fLoWS from fInanCInG aCtIVItIeS
Interest paid		(759,141)	(489,958)
Capital injection from previous shareholders
of acquired subsidiaries under common control		–	320,000
Acquisition of subsidiaries under common control		(21,350,801)	–
New bank and other borrowings		95,046,616	43,567,815
Repayment of bank and other borrowings		(77,598,733)	(41,673,316)
Repayment of corporate bonds		(188,815)	(175,243)
Decrease in finance lease obligations		(141)	(166,470)
Dividends paid to previous shareholders of
acquired subsidiaries under common control		(227,138)	(67,050)
Dividends paid to non-controlling shareholders		(137,492)	(46,935)
Net cash (used in)/generated from financing activities		(5,215,645)	1,268,843
net DeCreaSe In CaSH anD CaSH eQUIVaLentS		(2,042,962)	(3,565,314)
net DeCreaSe In CaSH anD CaSH eQUIVaLentS		(2,042,962)	(3,565,314)
Cash and cash equivalents at beginning of period		15,860,939	14,314,872
Effect of foreign exchange rate changes, net		147,304	11,010
Cash and cash equivalents at end of period	17	13,965,281	10,760,568

China Shipping Container LineS Company Limited 30 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS

FOR THE SIX MONTHS ENDED 30 JUNE 2016

1. Corporate InformatIon

China Shipping Container Lines Company Limited (the “Company”) was established in the People’s Republic of China (the “PRC”). The address of the Company’s registered office is Room A-538, International Trade Center, China (Shanghai) Pilot Free Trade Zone, Shanghai, the PRC.

On 11 December 2015, the Company announced that a notification was received from China Shipping (Group) Company, the former ultimate holding company and current immediate holding company of the Company, that the State-owned Assets Supervision and Administration Commission of the State Council of the PRC (the “SASAC”) has granted its approval in principle of the restructuring of China Shipping (Group) Company and its subsidiaries (the “CS Group”) and China Ocean Shipping (Group) Company and its subsidiaries (the “COSCO Group”) in relation to their businesses in container shipping, vessel leasing, oil shipping, bulk shipping and the financial sectors (the “Restructuring”). As part of the Restructuring, the Company and its relevant subsidiaries entered into a series of agreements with China Shipping (Group) Company, China Ocean Shipping (Group) Company and their relevant subsidiaries (the “Counterparties”) on 11 December 2015, whereby the Company and its relevant subsidiaries have agreed to acquire equity interests in certain companies’ operating container leasing businesses, shipping-related financial service business and other financial business from the Counterparties; and to sell equity interests in certain of its subsidiaries and associates operating port business and container shipping agency business to the Counterparties. As of 30 June 2016, the Company and its relevant subsidiary completed the following transactions within the Restructuring:

acquisition of subsidiaries

Acquisition of 100% equity interests in Dong Fang International Investment Limited and its subsidiaries;
Acquisition of 100% equity interests in Florens Container Holdings Limited and its subsidiaries;
Acquisition of 100% equity interests in China Shipping Nauticgreen Holdings Co., Ltd. and its subsidiaries;
Acquisition of 100% equity interests in Helen Insurance Brokers Limited;
Acquisition of 100% equity interests in Long Honour Investments Limited and its subsidiary;
Acquisition of 100% equity interests in China Shipping Investment Co., Ltd. and its subsidiaries;
Acquisition of 100% equity interests in China Shipping Leasing Co., Ltd. and its subsidiary; and
Acquisition of 40% equity interests in China Shipping Finance Co., Ltd. (“CS Finance”) (a former associate changed to a subsidiary with a total of 65% equity interests held subsequent to the acquisition).
(together as the “Acquired Subsidiaries” or “Acquirees”)

China Shipping Container LineS Company Limited InterIm rePOrt 2016 31

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued) FOR THE SIX MONTHS ENDED 30 JUNE 2016

1. Corporate InformatIon (Continued)

Disposal of subsidiaries

Disposal of 100% equity interests in China Shipping Container Lines Dalian Co., Ltd. and its subsidiaries, China Shipping Container Lines Tianjin Co., Ltd. and its subsidiaries, China Shipping Container Lines Qingdao Co., Ltd. and its subsidiaries, China Shipping Container Lines Shanghai Co., Ltd. and its subsidiaries, China Shipping Container Lines Xiamen Co., Ltd. and its subsidiaries, China Shipping Container Lines Guangzhou Co., Ltd. and its subsidiaries, China Shipping Container Lines Hainan Co., Ltd. and its subsidiary and China Shipping Container Lines Shenzhen Co., Ltd.;
Disposal of 100% equity interests in China Shipping Container Lines(Dalian) Data Processing Co., Ltd.;
Disposal of 100% equity interests in Shanghai Puhai Shipping Liners Co., Ltd. and its subsidiaries (“Puhai Group”);
Disposal of 100% equity interests in China Shipping (Yangpu) Refrigeration Storage & Transportation;
Disposal of 100% equity interests in China Shipping Container Lines Agency (Hong Kong) Co., Ltd.;
Disposal of 100% equity interests in Universal Shipping (Asia) Co., Ltd. (“Universal Shipping”);
Disposal of 60% equity interests in Golden Sea Shipping Pte. Ltd. (“Golden Sea”); and
Disposal of 91% equity interests in China Shipping (Singapore) Petroleum Pte. Ltd. (“CS Singapore Petroleum”)
(together as the “Disposed Subsidiaries”)

Disposal of interest in joint ventures and associates

Disposal of 50% equity interests in Dalian Vanguard International Logistics Co., Ltd., a former joint venture;
Disposal of 49% equity interests in China Shipping Ports Development Co., Ltd. (“CSPD”) and its subsidiaries, a former associate;
Disposal of 45% equity interests in Jinzhou Port Container and Railway Logistics Limited, a former joint venture; and
Disposal of 20.07% equity interests in Angang Vehicle Transportation Co., Ltd. and its subsidiary, a former associate.
(together as the “disposed interest in joint ventures and associates”)

This interim condensed consolidated financial information is presented in Renminbi (“RMB”), unless otherwise stated. This interim condensed consolidated financial information has been approved for issue by the board of directors of the Company on 30 August 2016.

This condensed consolidated interim financial information has not been audited.

China Shipping Container LineS Company Limited 32 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

2.1 BaSIS of preparatIon

The unaudited interim condensed consolidated financial statements, which comprise the interim condensed consolidated statement of financial position of the Group as at 30 June 2016 and the related interim condensed consolidated statement of profit or loss, the interim condensed consolidated statements of comprehensive income, changes in equity and cash flows for the six months ended 30 June 2016, have been prepared in accordance with HKAS 34 Interim Financial Reporting and Accounting Guideline 5 Merger Accounting for Common Control Combinations (“AG 5”) issued by the Hong Kong Institute of Certified Public Accountants and the applicable disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited.

Going concern

The Group had net current liabilities of RMB19,690,159,000 as at 30 June 2016. The Directors are of opinion that based on the available unutilised banking facilities as at 30 June 2016, the Group will have the necessary liquid funds to finance its working capital and to meet its capital expenditure requirements. Accordingly, the Directors are of the opinion that it is appropriate to prepare the interim condensed consolidated financial statements on a going concern basis.

The unaudited interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group’s annual financial statements for the year ended 31 December 2015.

2.2 merGer aCCoUntInG for Common ControL ComBInatIonS

The Group and all those acquirees in note 1 were under common control of SASAC before and after those acquisitions. Therefore, the Restructuring was accounted for as business combination involving entities under common control.

HKFRS 3 Business Combinations applies to all business combinations except where a combination is specifically excluded from its scope. For those business combinations outside the scope of HKFRS 3, for example, business combinations involving entities or businesses under common control, there is no specific accounting standard addressing the appropriate accounting treatment.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 33

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

2.2 merGer aCCoUntInG for Common ControL ComBInatIonS (Continued)

HKAS 8 Accounting Policies, Changes in Accounting Estimates and Errors contains requirements for the selection of accounting policies in the absence of a Standard or an Interpretation that specifically applies to an issue. Business combinations involving entities or business under common control fall outside the scope of HKFRS 3. Accordingly, the Group selects an appropriate accounting policy in accordance with the requirements set out in HKAS 8 and it is considered that merger accounting for common control combinations, as introduced by AG5, is an appropriate accounting policy for the above acquisitions of subsidiaries.

By applying AG 5, the acquisition of the subsidiaries in note 1 have been accounted for as if the acquisitions had occurred on the date when the combining entities first came under the control of the ultimate shareholder. Accordingly, the assets and liabilities acquired in the common control combinations are stated at their carrying amounts from the controlling parties’ perspective as if they had been held or incurred by the Group from the later of the date on which the combining entities first came under the control of the ultimate shareholder or the relevant transactions giving rise to the assets or liabilities arose.

By adopting with AG 5, the comparative amounts of the interim condensed financial statements of the Group have been restated to include the financial statement items of the acquired subsidiaries.

As of 30 June 2016, the Group has paid a total consideration of RMB21,350,801,000 to complete those acquisition of subsidiaries referred in note 1, which was treated as a deemed distribution.

2.3 SUmmarY of SIGnIfICant aCCoUntInG poLICIeS

As a result of merger accounting, the Group adopted the following additional significant accounting policies to those used in the annual financial statements for the year ended 31 December 2015 in the preparation of the interim condensed consolidated financial statements:

revenue recognition

Sales of goods

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership have been transferred to the buyer, and the Group maintains neither managerial involvement to the degree usually associated with ownership, nor effective control over the goods sold.

Finance lease income

Finance lease income is recognised on an accrual basis using the effective interest method by applying the rate that exactly discounts the estimated future cash receipts through the expected life of the net investment of a finance lease or a shorter period, when appropriate, to the net carrying amount of the net investment of the finance lease.

China Shipping Container LineS Company Limited 34 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

2.3 SUmmarY of SIGnIfICant aCCoUntInG poLICIeS (Continued) Investments and other financial assets

Initial recognition and measurement

When financial assets at fair value through profit or loss are recognised initially, they are measured at fair value and transaction costs that are attributable to the acquisition of the financial assets are charged to the statement of profit or loss. When available-for-sale financial investments are recognised initially, they are measured at fair value plus transaction costs that are attributable to the acquisition of the financial assets.

Subsequent measurement

Financial assets at fair value through profit or loss include financial assets held for trading. Financial assets are classified as held for trading if they are acquired for the purpose of sale in the near term.

Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value with net changes in fair value presented as other gains, net in the statement of profit or loss. These net fair value changes do not include any dividends or interest earned on these financial assets, which are recognised on an accrual basis using the effective interest method by applying the rate that exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter period, when appropriate, to the net carrying amount of the financial asset.

Available-for-sale financial investments are non-derivative financial assets in listed and unlisted equity investments and debt securities. Equity investments classified as available for sale are those which are neither classified as held for trading nor designated as at fair value through profit or loss. Debt securities in this category are those which are intended to be held for an indefinite period of time and which may be sold in response to needs for liquidity or in response to changes in market conditions.

After initial recognition, available-for-sale financial investments are subsequently measured at fair value, with unrealised gains or losses recognised as other comprehensive income in the available-for-sale investment revaluation reserve until the investment is derecognised, at which time the cumulative gain or loss is recognised in the statement of profit or loss in other income, or until the investment is determined to be impaired, when the cumulative gain or loss is reclassified from the available-for-sale investment revaluation reserve to the statement of profit or loss in other gains or losses. Interest and dividends earned whilst holding the available-for-sale financial investments are reported as interest income and dividend income, respectively and are recognised on an accrual basis using the effective interest method by applying the rate that exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter period, when appropriate, to the net carrying amount of the financial asset.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 35

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

2.3 SUmmarY of SIGnIfICant aCCoUntInG poLICIeS (Continued) Investments and other financial assets (Continued)

Subsequent measurement (Continued)

When the fair value of unlisted equity investments cannot be reliably measured because (a) the variability in the range of reasonable fair value estimates is significant of that investment or (b) the probabilities of the various estimates within the range cannot be reasonably assessed and used in estimating fair value, such investments are stated at cost less any impairment losses.

The Group evaluates whether the ability and intention to sell its available-for-sale financial investments in the near term are still appropriate. When, in rare circumstances, the Group is unable to trade these financial assets due to inactive markets, the Group may elect to reclassify these financial assets if management has the ability and intention to hold the assets for the foreseeable future or until maturity.

For a financial asset reclassified from the available-for-sale category, the fair value carrying amount at the date of reclassification becomes its new amortised cost and any previous gain or loss on that asset that has been recognised in equity is amortised to profit or loss over the remaining life of the investment using the effective interest rate. Any difference between the new amortised cost and the maturity amount is also amortised over the remaining life of the asset using the effective interest rate. If the asset is subsequently determined to be impaired, then the amount recorded in equity is reclassified to the statement of profit or loss.

Impairment of financial assets

Assets carried at cost

If there is objective evidence that an impairment loss has been incurred on an unquoted equity instrument that is not carried at fair value because its fair value cannot be reliably measured, or on a derivative asset that is linked to and must be settled by delivery of such an unquoted equity instrument, 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 discounted at the current market rate of return for a similar financial asset. Impairment losses on these assets are not reversed.

China Shipping Container LineS Company Limited 36 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

2.3 SUmmarY of SIGnIfICant aCCoUntInG poLICIeS (Continued)

Impairment of financial assets (continued)

Available-for-sale financial investments

For available-for-sale financial investments, the Group assesses at the end of each reporting period whether there is objective evidence that an investment or a group of investments is impaired.

If an available-for-sale asset is impaired, an amount comprising the difference between its cost (net of any principal payment and amortisation) and its current fair value, less any impairment loss previously recognised in the statement of profit or loss, is removed from other comprehensive income and recognised in the statement of profit or loss.

In the case of equity investments classified as available for sale, objective evidence would include a significant or prolonged decline in the fair value of an investment below its cost. The determination of what is “significant” or ‘’prolonged” requires judgement. “Significant” is evaluated against the original cost of the investment and “prolonged” against the period in which the fair value has been below its original cost. Where there is evidence of impairment, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that investment previously recognised in the statement of profit or loss – is removed from other comprehensive income and recognised in the statement of profit or loss. Impairment losses on equity instruments classified as available for sale are not reversed through the statement of profit or loss. Increases in their fair value after impairment are recognised directly in other comprehensive income.

In the case of debt instruments classified as available for sale, impairment is assessed based on the same criteria as financial assets carried at amortised cost. However, the amount recorded for impairment is the cumulative loss measured as the difference between the amortised cost and the current fair value, less any impairment loss on that investment previously recognised in the statement of profit or loss. Future interest income continues to be accrued based on the reduced carrying amount of the asset using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss. The interest income is recorded as part of finance income. Impairment losses on debt instruments are reversed through the statement of profit or loss if the subsequent increase in fair value of the instruments can be objectively related to an event occurring after the impairment loss was recognised in the statement of profit or loss.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 37

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

2.4 CHanGeS In aCCoUntInG poLICIeS anD DISCLoSUreS

The Group has adopted the following revised Hong Kong Financial Reporting Standards (“HKFRSs”) for the first time in these interim condensed consolidated financial statements:

Amendments to HKFRS 10, Investment Entities: Applying the Consolidation Exception HKFRS 12 and HKAS 28 (2011) Amendments to HKFRS 11 Accounting for Acquisitions of Interests in Joint Operations Amendments to HKAS 1 Disclosure Initiative Amendments to HKAS 16 and HKAS 38 Clarification of Acceptable Methods of Depreciation and Amortisation Amendments to HKAS 16 and HKAS 41 Agriculture: Bearer Plants Amendments to HKAS 27 (2011) Equity Method in Separate Financial Statements Annual Improvements 2012-2014 Cycle Amendments to a number of HKFRSs

The adoption of these new and revised HKFRSs has had no significant financial effect on the Group’s interim condensed consolidated financial statements.

The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.

Except for the additional significant accounting policies as a result of merger accounting and the changes in accounting policies noted above, the accounting policies and basis of preparation adopted in the preparation of the interim condensed consolidated financial statements are the same as those used in the annual financial statements for the year ended 31 December 2015.

2.5 a CHanGe In aCCoUntInG eStImateS

With effect from 1 January 2016, the Group made a change in depreciation estimates as follows:

Estimated residual value of vessels changed from US$420 to US$280 per ton
Estimated useful life of certain containers changed from 12 years to 15 years
Estimated residual value of certain containers changed from US$830-US$1,344 to US$560-US$896 per container

This constitutes a change in accounting estimates. In the opinion of the directors, based on the current business condition, the estimated residual value and useful lives of these containers are more appropriately reflected by the change.

The change has been applied prospectively and has resulted in an increase in depreciation of approximately RMB76,500,000 for the six months ended 30 June 2016.

China Shipping Container LineS Company Limited 38 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

3. operatInG SeGment InformatIon anD reVenUe

For management purposes, the Group is organised into business units based on their products and services and has seven reportable operating segments as follows:

(a) Container shipping segment, which renders the container marine transportation services and related businesses;
(b) Vessel chartering and container leasing segment, which specifically leases vessels and containers;
(c) Non-shipping related leasing segment, other than leases vessels and containers;
(d) Container segment, which is a supplier of containers;
(e) Financial services segment, which renders corporate banking and insurance agency services;
(f) Equity investment segment, which focuses on equity investments, such as investments in associates, investments in joint ventures and available-for-sale equity investments; and
(g) The “others” segment comprises, principally, logistic services and other miscellaneous services.

Management monitors the results of the Group’s operating segments separately for the purpose of making decisions about resources allocation and performance assessment. Segment performance is evaluated based on reportable segment profit/(loss), which is a measure of adjusted profit/(loss) before tax from continuing operations. The adjusted profit/(loss) before tax from continuing operations is measured consistently with the Group’s profit before tax from continuing operations except that head office and corporate expenses are excluded from such measurement.

China Shipping Container LineS Company Limited InterIm rePOrt 2016 39

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued) FOR THE SIX MONTHS ENDED 30 JUNE 2016

for the six months ended 30 June 2016 For the six months ended 30 June 2015 Container Shipping Vessel chartering and container leasing non- shipping related leasing Container financial services equity investment others total Container Shipping Vessel chartering and container leasing Non- shipping related leasing Container Financial services Equity investment Others Total *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Restated) (Restated) (Restated) (Restated) (Restated) (Restated) (Restated) (Restated) Segment revenue: Sales to external customers 3,235,222 4,151,288 349,055 475,663 148,941 – 15,766 8,375,935 13,598,797 1,898,409 67,243 848,195 214,644 – 26,735 16,654,023 Intersegment sales – 1,924,030 – 195,666 27,120 – – 2,146,816 – 2,143,450 – 1,016,788 4,622 – – 3,164,860	Total revenue 3,235,222 6,075,318 349,055 671,329 176,061 – 15,766 10,522,751 13,598,797 4,041,859 67,243 1,864,983 219,266 – 26,735 19,818,883	Segment results (940,341) 120,430 213,099 (17,728) 94,763 (91,544) (6,623) (627,944) 251,366 474,155 45,678 45,899 120,997 495,883 1,311 1,435,289	Elimination of intersegment results 87,836 (181,798) Unallocated administrative and general expenses (195,798) (252,890) (Loss)/profit before tax (735,906) 1,000,601 Supplementary segment result information: Depreciation and amortisation (318,001) (1,209,925) (401) (30,213) (1,143) – (868) (1,560,551) (703,117) (692,323) (42) (34,127) (1,850) – (9) (1,431,468) Reversal/(provision) of impairment on trade receivables and notes receivables, loans and receivables and finance lease receivables 3,382 13,964 (21,059) 2,269 37,523 – – 36,079 (5,930) (890) (7,028) (1,345) 4,487 – – (10,706) Finance costs (74,218) (567,851) – (44,847) – – – (686,916) (280,370) (119,719) – (25,693) – – – (425,782) Dividend income – – – – – 12,076 – 12,076 – – – – – 64,541 – 64,541 Share of profits/(losses) of: – – Associates – – – – – (135,784) – (135,784) – – – – – 434,235 – 434,235 Joint ventures – – – – – 5,488 – 5,488 – – – – – 1,457 – 1,457

China Shipping Container LineS Company Limited InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued) FOR THE SIX MONTHS ENDED 30 JUNE 2016

					Others Total	RMB’000 RMB’000	(Unaudited) (Unaudited)	(Restated) (Restated)	59,303 111,310,648	(7,269,240)	104,041,408	(27,397) (72,607,033)	5,646,792	(66,960,241)
				Equity	investment	RMB’000	(Unaudited)	(Restated)	9,774,953			(8,573,518)
31 December 2015				Financial	Container services	RMB’000 RMB’000	(Unaudited) (Unaudited)	(Restated) (Restated)	4,702,115 10,395,887			(3,636,083) (9,785,930)
		Non-	shipping	related	leasing	RMB’000	(Unaudited)	(Restated)	5,034,998			(3,589,440)
30 June 2016	Vessel Vessel	chartering non- chartering	and shipping and	Container container related financial equity Container container	Shipping leasing leasing Container services investment others total Shipping leasing	*RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* *RMB’000* RMB’000 RMB’000	(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)	(Restated) (Restated)	2,416,355 123,775,159 9,049,886 5,309,392 14,034,889 10,633,385 45,101 165,264,167 50,890,055 30,453,337	(63,970,489)	101,293,678	(3,503,996) (78,294,128) (7,439,390) (3,244,150) (13,501,419) (8,724,473) (18,874) (114,726,430) (32,498,330) (14,496,335)	27,579,677	(87,146,753)
									Segment assets	Elimination of intersegment assets	total assets	Segment liabilities	Elimination of intersegment liabilities	total liabilities

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FOR THE SIX MONTHS ENDED 30 JUNE 2016

4. otHer InCome

	for the six months ended 30 June	for the six months ended 30 June
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Interest income generated from operations other
than financial services	34,823	65,622
Government grant related to income	21,790	1,974
Refund of value-added tax (“VAT”)	112	79,219
Dividend income from available-for-sale financial investments	11,962	64,326
Dividend income from held-for-trading investments	114	215
Others	4,434	8,884
	73,235	220,240
otHer GaInS, net
	for the six months ended 30 June
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Gain on disposal of subsidiaries	10,915	–
Gain on disposal of interests in associates	99,052	–
Gain on disposal of interests in joint ventures	17,571	–
Gain on disposal of items of property, plant and equipment	42,613	38,391
Gains on dilution of investment in an associate	–	30,887
Gain on disposal of available-for-sale investments	1,302	3,388
Fair value gain on held-for-trading investments	745	515
Net foreign exchange (loss)/gain	(49,945)	4,712
Others	7,998	(1,133)
	130,251	76,760

5. otHer GaInS, net

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6. fInanCe CoStS

fInanCe CoStS
	for the six months	ended 30 June
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Interest on borrowings and corporate bonds	693,946	428,298
Interest on finance lease	–	1,632
Total interest expense	693,946	429,930
Less: interest capitalised	(7,030)	(4,148)
	686,916	425,782

7. InCome taX

According to the Corporate Income Tax (“CIT”) Law of PRC, which was effective from 1 January 2008, the CIT rate applicable to the Company and its subsidiaries incorporated in PRC was 25% for the six months ended 30 June 2016 and 2015.

Pursuant to the PRC CIT Law, a 10% withholding tax is levied on dividends declared to foreign investors from the foreign investment enterprises established in Mainland China. The requirement is effective from 1 January 2008 and applies to earnings after 31 December 2007. A lower withholding tax rate may be applied if there is a tax treaty between Mainland China and the jurisdiction of the foreign investors. Some overseas subsidiaries are therefore liable for withholding taxes on dividends distributed by those subsidiaries, associates and joint ventures established in Mainland China in respect of earnings generated from 1 January 2008. Certain overseas subsidiaries of the Company are subject to preferential tax rate of 5%.

Hong Kong profits tax was provided at the rate of 16.5% on the estimated assessable profits of the Group’s companies operating in Hong Kong for the six months ended 30 June 2016 (for the six months ended 30 June 2015: 16.5%).

The major components of income tax expense of the Group are as follows:

	for the six months	ended 30 June
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Current income tax – PRC	94,087	76,285
Current income tax – Hong Kong	1,974	2,357
Current income tax – elsewhere	2,222	9,440
Withholding tax on the distribution of dividends from PRC associates	14,916	19,761
Deferred tax	(32,393)	13,492
	80,806	121,335

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FOR THE SIX MONTHS ENDED 30 JUNE 2016

8. DISContInUeD operatIon

During February 2016, the Restructuring referred in note 1 was approved by the independent shareholders of the Company as well as the relevant regulatory authorities.

Among the disposed subsidiaries in note 1, Puhai Group, Universal Shipping, Golden Sea and CS Singapore Petroleum constituted a major line of business of provision of container marine transportation services and related business, which was classified as a discontinued operation. These disposals were completed before 30 June 2016, the assets and liabilities are no longer included in the interim condensed consolidated statement of financial position as at 30 June 2016.

The results of the discontinued operation for the period are presented below:

	for the six months	ended 30 June
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Revenue	411,138	1,726,664
Cost	(395,364)	(1,685,037)
Expenses	(12,399)	(39,644)
Other income	1,303	18,864
Other gains/(loss)	6,489	(7,337)
Finance costs	(3)	(161)
Profit before tax from the discontinued operation	11,164	13,349
Income tax expense	(1,392)	(3,930)
Profit for the period from the discontinued operation	9,772	9,419

The net cash flows incurred by the discontinued operation are as follows:

	for the six months ended 30 June	for the six months ended 30 June
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Operating activities	208,887	52,758
Investing activities	–	6,627
Financing activities	(38,072)	(28,821)
Effect of foreign exchange rate changes, net	3,030	564
Net cash flows	173,845	31,128
Earnings per share (expressed in RMB per share):
Basic and diluted, from the discontinued operation	0.0006	0.0001

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FOR THE SIX MONTHS ENDED 30 JUNE 2016

8. DISContInUeD operatIon (Continued)

Apart from the disposed subsidiaries in note 1, approved disposal of China Shipping Container Lines Agency (Shenzhen) Co., Ltd. and Universal Logistics (Shenzhen) Co., Ltd. are yet to complete by 30 June 2016. The major classes of assets and liabilities of those subsidiaries are classified as held for sale as at 30 June 2016 as follows:

Assets Property, plant and equipment Intangible assets Prepayments and other receivables Assets of a disposal group classified as held for sale Liabilities Trade payables Income tax payable Liabilities directly associated with assets classified as held for sale Net liabilities directly associated with the disposal group	30 June 2016 *RMB’000* (Unaudited) 1,485 94 9,457 11,036 (61,504) (5,431) (66,935) (55,899)

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FOR THE SIX MONTHS ENDED 30 JUNE 2016

9. (LoSS)/earnInGS per SHare attrIBUtaBLe to orDInarY eQUItY HoLDerS of tHe parent

Basic earnings per share is calculated by dividing the profit attributable to owners of the parent by the weighted average number of ordinary shares in issue during the period.

	for the six months ended	for the six months ended	30 June
	2016		2015
	*RMB’000*		RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
(Loss)/earnings
(Loss)/profit attributable to ordinary equity holders of the parent,
used in the basic earnings per share calculation:
From continuing operations	(841,489)		830,460
From a discontinued operation	6,917		656
	(834,572)		831,116
	number of shares for		the
	six months ended
	30 June 2016	30 June 2015
Shares
Weighted average number of ordinary shares in issue during
the period used in the basic earnings
per share calculation (thousands)	11,683,125	11,683,125

There was no dilution effect for the period (six months ended 30 June 2015: None).

10. DIVIDenD

The directors did not recommend any interim dividend for the six months ended 30 June 2016 (six months ended 30 June 2015: Nil).

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FOR THE SIX MONTHS ENDED 30 JUNE 2016

11. propertY, pLant anD eQUIpment

propertY, pLant anD eQUIpment
		2016
	Notes	*RMB’000*
		(Unaudited)
At 1 January as previously reported		38,336,165
Effect of merger accounting	2.2	18,306,491
At 1 January (Restated)		56,642,656
Additions		2,651,171
Disposals		(318,820)
Disposal of subsidiaries	23	(165,061)
Depreciation provided during the period		(1,559,611)
Impairment		(6,183)
Transfer to inventories		(36,735)
Exchange realignment		908,814
At 30 June		58,116,231
		2015
	Notes	RMB’000
		(Unaudited)
		(Restated)
At 1 January as previously reported		36,369,808
Effect of merger accounting	2.2	15,032,093
At 1 January (Restated)		51,401,901
Additions		4,760,221
Disposals		(81,203)
Disposal of subsidiaries	23	(3,307)
Depreciation provided during the period		(1,418,954)
Exchange realignment		(38,147)
At 30 June		54,620,511

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12. InVeStmentS In aSSoCIateS

InVeStmentS In aSSoCIateS
	30 June 2016 31 December 2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Share of net assets	8,488,321	11,739,288
Goodwill on acquisition	221,731	263,034
	8,710,052	12,002,322

As of 30 June 2016, particulars of the material associates are as follows:

			percentage
			of
	particulars of	place of	ownership
name	issued shares held	registration	interest	principal activities
China International Marine	Registered capital of	PRC	22.77	Manufacture and sale
Containers (Group) Co., Ltd.	RMB1 each			of containers
(“CIMC”)
Bank of Kunlun Co., Ltd.	Registered capital of	PRC	3.98	Banking
(“BOK”)	RMB1 each
Shanghai Life Insurance Co., Ltd.	Registered capital of	PRC	16	Insurance
(“Shanghai Life”)	RMB1 each
China Shipping Ports	Ordinary shares	Hong Kong	49	Operation of
Development Co.,Ltd. (“CSPD”)				container terminal

Though the Group has less than 20% of the equity interest in BOK and Shanghai Life, it has representation on the board of directors has cast significant influence over these companies.

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12. InVeStmentS In aSSoCIateS (Continued)

The following tables illustrate the summarised financial information in respect of each of the Group’s material associates adjusted for any differences in accounting policies and reconciled to the carrying amount in the financial statements:

	CImC	CImC		BoK	BoK		Shanghai Life	Shanghai Life	CSpD	CSpD
	30 June	31	December	30 June	31	December	30 June	31 December	30 June	31	December
	2016		2015	2016		2015	2016	2015	2016		2015
	*RMB’000*		RMB’000	*RMB’000*		RMB’000	*RMB’000*	RMB’000	*RMB’000*		RMB’000
	(Unaudited)	(Unaudited)		(Unaudited)	(Unaudited)		(Unaudited)	(Unaudited)	(Unaudited)	(Unaudited)
			(Restated)			(Restated)		(Restated)
Current assets	44,976,531	43,530,325		109,819,069	134,160,910		11,370,091	5,319,500	–		404,746
Non-current assets	69,823,386	63,232,846		182,753,538	156,016,861		26,643,446	12,995,896	–		7,940,687
Total liabilities	80,446,229	71,268,295		268,793,922	267,237,005		33,084,557	16,760,961	–		617,468
Net assets attributable to owners of the parent	25,644,350	26,508,276		23,719,934	22,884,525		4,928,980	1,554,435	–		7,286,300
Equity instrument	1,981,143		2,033,043	–		–	–	–	–		–
Non-controlling interests	6,728,195		6,953,557	58,751		56,241	–	–	–		441,665
Net assets	34,353,688	35,494,876		23,778,685	22,940,766		4,928,980	1,554,435	–		7,727,965
Reconciliation to the Group’s interests
in the associates:
Proportion of the Group’s ownership	22.77%		22.77%	3.975%		3.975%	16%	16%	–		49%
Group’s share of net assets of the associates	5,837,855		6,035,618	942,867		909,660	788,637	248,710	–		3,570,287
Group’s share of the revaluation surplus
of assets of the associate	810,583		810,661	–		–	–	–	–		–
Goodwill on acquisition	–		–	221,731		221,731	–	–	–		25,452
Carrying amounts of the investments	6,648,438		6,846,279	1,164,598		1,131,391	788,637	248,710	–		3,595,739

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FOR THE SIX MONTHS ENDED 30 JUNE 2016

12. InVeStmentS In aSSoCIateS (Continued)

InVeStmentS In aSSoCIa	t	eS(Continued)
Revenue Attributable to owners of parent: (Loss)/profit for the period Other comprehensive income/(loss) for the period Total comprehensive income/(loss) for the period Dividends declared			for the six months ended 30 June
	CImC BoK Shanghai Life CSpD 2016 2015 2016 2015 2016 2015 2016 2015 *RMB’000* RMB’000 *RMB’000* RMB’000 *RMB’000* RMB’000 *RMB’000* RMB’000 (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Restated) (Restated) (Restated) 23,542,843 32,637,289 4,894,081 6,034,584 11,132,437 130,320 88,609 193,831 (378,034) 1,518,195 1,622,761 1,770,291 (726,228) (31,804) 17,229 135,596 274,766 (51,516) (12,486) 29,287 (139,227) (47,495) (10,046) 33,453 (103,268) 1,466,679 1,610,275 1,799,578 (865,455) (79,299) 7,183 169,049 654,822 833,030 774,866 767,487 – – – –			CSpD

The following table illustrates the aggregate financial information of the Group’s associates that are not individually material:

	for the six months ended 30 June	for the six months ended 30 June	for the six months ended 30 June
	2016		2015
	*RMB’000*		RMB’000
	(Unaudited)		(Unaudited)
			(Restated)
Share of the associates’ profit for the period	13,840		8,836
Share of the associates’ other comprehensive income	639		371
Share of the associates’ total comprehensive income	14,479		9,207
	30 June 2016	31 December 2015
	*RMB’000*		RMB’000
	(Unaudited)		(Unaudited)
			(Restated)
Aggregate carrying amount of the Group’s investments in the associates	108,379		180,203

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13. aVaILaBLe-for-SaLe InVeStmentS

	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Open-ended funds, at fair value	607,311	686,666
Wealth management products, at cost	650,000	295,000
Listed equity investments, at fair value	137,026	205,468
Unlisted equity investments, at cost	162,781	162,781
	1,557,118	1,349,915

During the six months ended 30 June 2016 and 2015, a net loss after tax of RMB95,567,000 and a net gain after tax of RMB66,473,000 in respect of the Group’s available-for-sale investments were recognised in other comprehensive income, respectively,

The unlisted available-for-sale investments are stated at cost because the range of reasonable fair value estimates is so significant that the directors are of the opinion that the fair value cannot be measured reliably.

14. fInanCe LeaSe reCeIVaBLeS

30 June 2016 effective interest rate maturity Current portion 2.6363%-23.1% 2016-2017 Non-current portion 2.6363%-23.1% 2017-2026 Less: impairment	30 June 2016	31 December 2015 rmB’000 Effective interest rate Maturity RMB’000 (Unaudited) (Unaudited) (Restated) 2,167,891 3.21% to 23.1% 2016 1,687,513 9,082,783 3.21% to 23.1% 2017 to 2026 5,730,373 11,250,674 7,417,886 (83,989) (54,901) 11,166,685 7,362,985	31 December 2015	31 December 2015
				RMB’000 (Unaudited) (Restated) 1,687,513 5,730,373
				7,417,886 (54,901)
				7,362,985

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FOR THE SIX MONTHS ENDED 30 JUNE 2016

14. fInanCe LeaSe reCeIVaBLeS (Continued)

Amounts receivables: Within one year In the second to fifth years, inclusive After five years	minimum lease receivables 30 June 2016 31 December 2015 *RMB’000* RMB’000 (Unaudited) (Unaudited) (Restated) 2,807,317 2,157,114 8,596,497 5,755,729 2,153,980 1,042,080	present value of minimum lease receivables
		30 June 2016 31 December 2015 *RMB’000* RMB’000 (Unaudited) (Unaudited) (Restated) 2,167,891 1,687,513 7,224,478 4,856,576 1,858,305 873,797
Total minimum finance lease receivables Less: unearned finance income Less: impairment Total net finance lease receivables Portion classified as current assets Non-current portion	13,557,794 8,954,923 (2,307,120) (1,537,037) (83,989) (54,901) 11,166,685 7,362,985 (2,142,961) (1,682,327) 9,023,724 5,680,658	11,250,674 7,417,886

The tables below summarise the movement of impairment losses on finance lease receivables:

		2016	2015
	Note	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
At 1 January as previously reported		–	–
Effect of merger accounting	2.2	54,901	24,111
At 1 January (Restated)		54,901	24,111
Impairment allowances charged		29,087	7,730
Exchange realignment		1	66
At 30 June		83,989	31,907

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15. LoanS anD reCeIVaBLeS

LoanS anD reCeIVaBLeS
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Current portion	1,830,739	3,133,055
Non-current portion	207,413	368,467
	2,038,152	3,501,522
The tables below summarise loans and receivables by natures:
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Corporate loans	2,090,412	3,591,305
Impairment losses on loans and receivables	(52,260)	(89,783)
	2,038,152	3,501,522

The tables below summarise the movement of impairment losses on loans and receivables:

		2016	2015
	Note	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
At 1 January as previously reported		–	–
Effect of merger accounting	2.2	89,783	115,861
At 1 January (Restated)		89,783	115,861
Impairment allowances charged		18,694	17,550
Reversal of impairment allowances		(56,217)	(22,037)
At 30 June		52,260	111,374

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16. traDe anD noteS reCeIVaBLeS

traDe anD noteS reCeIVaBLeS
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Trade receivables	1,719,099	2,583,188
Notes receivables	66,093	202,293
	1,785,192	2,785,481
Impairment of trade receivables	(64,864)	(97,375)
	1,720,328	2,688,106

The tables below summarise the movement of impairment of trade receivables:

		2016	2015
	Note	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
At 1 January as previously reported		53,531	67,848
Effect of merger accounting	2.2	43,844	25,627
At 1 January (Restated)		97,375	93,475
Impairment losses recognised		18,877	10,511
Impairment losses reversed		(46,520)	(3,048)
Write-off		(54)	(2,084)
Disposal of subsidiaries		(5,852)	–
Exchange realignment		1,038	(751)
At 30 June		64,864	98,103

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17. CaSH anD CaSH eQUIVaLentS anD reStrICteD CaSH

		30 June	31 December
		2016	2015
	Note	*RMB’000*	RMB’000
		(Unaudited)	(Unaudited)
			(Restated)
Cash and bank balances		14,829,828	16,783,207
Mandatory reserves with the central bank	a	(670,985)	(624,391)
Pledged time deposits for corporate bonds and
general banking facilities		(120,020)	(182,066)
Pledged time deposits for bank acceptance bills		(16,920)	–
Time deposits with original maturity of
more than three months		–	(60,000)
Pledged to customs as guarantees for import		–	(1,410)
Restricted insurance premium received		(56,622)	(54,401)
Restricted cash		(864,547)	(922,268)
Cash and cash equivalents		13,965,281	15,860,939

Note:

(a) CS Finance is required to place mandatory reserve deposits with the People’s Bank of China (“PBOC”), the PRC central bank. Mandatory reserve deposits with the central bank are not available for use in CS Finance’s daily operations.

18. GeneraL reSerVeS

Pursuant to Caijin [2012] No.20 Requirements on Impairment Allowance for Financial Institutions (“Requirement”), issued by Ministry of Finance, in addition to the impairment allowance, CS Finance establishes a general reserve within the equity holders’ equity through the appropriation of profit to address unidentified potential impairment losses. The general reserve should not be less than 1.5% of the aggregate amount of risk assets as defined by the Requirement, and the minimum threshold can be accumulated over a period of no more than five years.

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19. BanK anD otHer BorroWInGS

BanK anD otHer BorroWInGS
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Current
Bank loans	11,913,789	7,144,984
Commercial paper notes	2,320,920	4,870,200
Borrowing from fellow subsidiary	10,609,920	10,533,659
Borrowing from immediate holding company	4,500,000	4,270,000
	29,344,629	26,818,843
non-current
Bank loans	29,996,913	23,775,727
Borrowing from fellow subsidiary	9,482,616	324,680
Borrowing from the immediate holding company	2,300,000	1,249,360
	41,779,529	25,349,767
	71,124,158	52,168,610

China Shipping Container LineS Company Limited 56 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued) FOR THE SIX MONTHS ENDED 30 JUNE 2016

20. Corporate BonDS

Corporate BonDS
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Current portion	2,042,810	245,617
Non-current portion	1,506,225	3,449,494
	3,549,035	3,695,111

On 12 June 2007, the Company issued corporate bonds in the PRC with a face value of RMB1,800,000,000 (“Bond A”), pursuant to the approval obtained from the National Development and Reform Commission of the PRC. The bonds are denominated in RMB and for a ten-year period fully repayable by 12 June 2017, and bear interest at a rate of 4.51% per annum. The bonds are guaranteed by the Bank of China, Shanghai branch, and have been listed on the interbank bond market in the PRC. As of 30 June 2016, the carrying amount of Bond A was RMB1,797,658,000 (31 December 2015: RMB1,796,432,000).

On 25 September 2013, Dong Fang Container Finance (SPV) Limited (“DFCF(SPV)”), a subsidiary of the Company, issued a note with an aggregate principal amount of US$200,000,000 (“Note 2013”). The note carried an interest yield of 3.96% per annum and was issued at a price of 99.1001049% of its principal amount. The note bears interest from 25 September 2013, payable monthly in arrears. Unless previously prepaid by DFCF(SPV), the note is repayable monthly in accordance with the repayment schedule in the note offering memorandum commencing from October 2013. The note is subject to repayment in whole or in part, at a price equal to 102% of the aggregate principal amount if repayment made during 25 October 2015 to 24 October 2018 or 100% of the aggregate principal amount if repayment made on or after 25 October 2018, together with accrued interest, at the discretion of DFCF(SPV) at any time after 25 October 2015. As of 30 June 2016, the carrying amount of Note 2013 was RMB840,949,000 (31 December 2015: RMB1,012,753,000).

On 4 December 2014, the Dong Fang Container Finance II (SPV) Limited (“DFCFII(SPV)”), a subsidiary of the Company, issued notes with 2 classes (together refer to as “Note 2014”). The notes are set out as follows:

(a) principal amount of US$35,000,000 class A-1 notes (the “Class A-1 Notes”), and
(b) principal amount of US$124,000,000 class A-2 notes (the “Class A-2 Notes”).

China Shipping Container LineS Company Limited InterIm rePOrt 2016 57

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

20. Corporate BonDS (Continued)

Class A-1 Notes carried an interest yield of 1.95% per annum and were issued at a price of 99.99017% of its principal amount.

Class A-2 Notes carried an interest yield of 3.55% per annum and were issued at a price of 99.89347% of its principal amount.

The notes bear interest from 4 December 2014, payable monthly in arrears. Unless previously repaid by DFCFII(SPV), Class A-1 Notes and Class A- 2 Notes are repayable monthly in accordance with the repayment schedule in the note offering memorandum commencing from December 2014. The notes are subject to prepayment in whole or in part at their principal amount, together with accrued interest, at the discretion of DFCFII(SPV) at any time after 4 December 2016. As of 30 June 2016, the carrying amount of Note 2014 was RMB910,428,000 (31 December 2015: RMB885,926,000).

21. DepoSItS from CUStomerS

	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Current
Demand deposits	7,132,076	4,482,658
Time deposits	689,761	–
	7,821,837	4,482,658
non-current
Time deposits	8,951	8,900
	7,830,788	4,491,558

22. otHer LonG term paYaBLeS

Long term payables represent deposits for finance lease contract received from customers due after one year.

China Shipping Container LineS Company Limited 58 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

23. DISpoSaL of SUBSIDIarIeS

(a) During the six months ended 30 June 2016, the Group disposed of a series of subsidiaries, particulars of which can be referred to note 1.

Details of the net assets disposed of and gain on disposal are as follows:

		RMB’000
		(Unaudited)
Net assets disposed of:
Property, plant and equipment		164,594
Investment properties		2,028
Intangible assets		4,145
Deferred tax assets		1,018
Inventories		18,087
Trade and notes receivables		2,726,445
Prepayments and other receivables		585,237
Cash and cash equivalents		1,130,988
Bank and other borrowings		(416,954)
Deferred tax liabilities		(64)
Other long term payables		(335)
Trade payables		(2,555,611)
Other payables and accruals		(776,900)
Tax payable		(8,208)
Non-controlling interests		(63,341)
		811,129
Reclassification adjustments on exchange differences
on translation of foreign operations to gain included
in the interim condensed consolidated statement of profit or loss		1,431
Gain on disposal of subsidiaries		10,064
		822,624
Satisfied by:
Cash		800,481
Other receivables		22,143
		822,624

An analysis of the net outflow of cash and cash equivalents in respect of the disposal of subsidiaries is as follows:

	RMB’000
	(Unaudited)
Cash and cash equivalents disposed of	(1,131,574)
Cash received	801,067
Net outflow of cash and cash equivalents in respect of
the disposal of subsidiaries	(330,507)

China Shipping Container LineS Company Limited InterIm rePOrt 2016 59

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

23. DISpoSaL of SUBSIDIarIeS (Continued)

(b) The Group had 25% equity interests in E-shipping Global Supply Chain Management Co.,Ltd. (“E-shipping”) and controlled E-shipping with dominant voting rights from contractual arrangement with the other vote holders of E-shipping as at 31 December 2015. During the six months ended 30 June 2016, such contractual arrangement ceased. Accordingly, the Group lost control over E-shipping, which was transferred from a subsidiary of the Group to an associate of the Group.

Details of the net assets disposed of and gain on disposal are as follows:

		RMB’000
		(Unaudited)
Net assets disposed of:
Property, plant and equipment		467
Inventories		331
Trade and notes receivables		3,464
Prepayments and other receivables		911
Cash and cash equivalents		19,377
Trade payables		(1,209)
Other payables and accruals		(16,569)
Non-controlling interests		(1,839)
		4,933
Gain on disposal of subsidiary		1,851
		6,784
Satisfied by:
Investment in an associate		6,784
An analysis of the net outflow of cash and cash equivalents in respect of the disposal of subsidiary is as
follows:
		RMB’000
		(Unaudited)
Cash and cash equivalents disposed of and net outflow of
cash and cash equivalents in respect of the disposal of subsidiary		(19,377)

China Shipping Container LineS Company Limited 60 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

23. DISpoSaL of SUBSIDIarIeS (Continued)

(c) On 1 January 2015, the Group transferred 100% equity interests in four subsidiaries, Shanghai Zhenjing Industrial Co.,Ltd., Shanghai Chutai Industrial Co.,Ltd., Shanghai Chaokun Industrial Co.,Ltd., and Shanghai Yuekun Industrial Co.,Ltd. to China Shipping Property Co.,Ltd., a fellow subsidiary, for nil consideration. These four subsidiaries were engaged in property investment.

Details of the net assets disposed of and equity charged on disposal are as follows:

	RMB’000
	(Unaudited)
	(Restated)
Net assets disposed of:
Property, plant and equipment	3,307
Investment properties	429,686
Prepayments and other receivables	18,812
Cash and cash equivalents	8,005
Other payables and accruals	(4,322)
	455,488
Charge other reserves	(58,272)
Charge retained profits	(397,216)
	–

An analysis of the net outflow of cash and cash equivalents in respect of the disposal of subsidiary is as follows:

	RMB’000
	(Unaudited)
	(Restated)
Cash and cash equivalents disposed of and net outflow of
cash and cash equivalents in respect of the disposal of subsidiary	(8,005)

China Shipping Container LineS Company Limited InterIm rePOrt 2016 61

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

24. CommItmentS

The Group had the following capital commitments at the end of the reporting period:

	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Contracted, but not provided for:
Equity investment	1,575,000	–
Containers	24,802	19,954
Vessel under construction	10,654,848	10,528,286
Others	69,325	69,325
	12,323,975	10,617,565

China Shipping Container LineS Company Limited 62 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

25. SIGnIfICant reLateD partY tranSaCtIonS

	for the six months	ended 30 June
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Interest income from immediate holding company	16,791	–
Interest expenses to immediate holding company	133,657	35,437
Income from fellow subsidiaries:
Liner service income	11,908	55,820
Finance lease income	10,677	13,904
Container rental income	766,425	543,197
Chassis rental income	276	–
Vessels rental income	2,073,633	–
House rental income	–	1,601
Fuel supply	200,662	684,453
Nomination fee income	5,481	2,695
Interest income	36,059	51,340
Commission income	1,768	804
Insurance income	3,837	4,184
Expenses to fellow subsidiaries:
Vessel construction	71,251	–
Lease of containers	29,370	2,677
Lease of chassis	–	2,287
Lease of properties	9,788	33,270
Cargo and liner agency services	66,007	292,420
Container management services	16,696	49,852
Vessel repair services	17,403	10,463
Handling, storage and maintenance expenses	3,135	1,216
Supply of fresh water, vessel fuel, lubricants,
spare parts and other materials	161,647	650,772
Depot services	3,877	9,036
Information technology service charges	8,021	18,847
Provision of crew members	360,884	367,711
Loading and unloading services	143	522,997
Purchase of containers	36,566	823,476
Ground container transport costs	3,732	3,248
Interest expenses	11,330	18,006
Key management compensation:
Basic salaries and allowances	3,670	9,235

China Shipping Container LineS Company Limited InterIm rePOrt 2016 63

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

26. fInanCIaL InStrUmentS BY CateGorY

The carrying amounts of each of the categories of financial instruments as at the end of the reporting period are as follows:

financial assets – held-for-trading financial assets

financial assets – held-for-trading financial assets
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Held-for-trading investments	21,668	200,349
financial assets – loans and receivables
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Cash and cash equivalents	13,965,281	15,860,939
Restricted cash	864,547	922,268
Trade and notes receivables	1,720,328	2,688,106
Financial assets included in prepayments and other receivables	724,192	1,521,211
Finance lease receivables	11,166,685	7,362,985
Loans and receivables	2,038,152	3,501,522
	30,479,185	31,857,031
financial assets – available-for-sale financial assets
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Available-for-sale investments	1,557,118	1,349,915

China Shipping Container LineS Company Limited 64 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

26. fInanCIaL InStrUmentS BY CateGorY (Continued) financial liabilities – held-for-trading financial liabilities

fInanCIaL InStrUmentS BY CateGorY(Continued) financial liabilities – held-for-trading financial liabilities
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Derivative financial instruments	33,389	838
financial liabilities – other liabilities at amortised cost
	30 June	31 December
	2016	2015
	*RMB’000*	RMB’000
	(Unaudited)	(Unaudited)
		(Restated)
Trade and notes payables	2,291,539	4,041,654
Financial liabilities included in other payables and accruals	940,029	1,351,986
Bank and other borrowings	71,124,158	52,168,610
Corporate bonds	3,549,035	3,695,111
Finance lease obligations	–	141
Deposits from customers	7,830,788	4,491,558
Other long term payables	701,370	405,129
	86,436,919	66,154,189

China Shipping Container LineS Company Limited InterIm rePOrt 2016 65

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

27. faIr VaLUe anD faIr VaLUe HIerarCHY of fInanCIaL InStrUmentS

The carrying amounts and fair values of the Group’s financial instruments, other than those with carrying amounts that reasonably approximate to fair values, are as follows:

Finance lease receivables Bank and other borrowings Corporate bonds Other long term payables		Carrying amounts 30 June 2016 31 December 2015 *RMB’000* RMB’000 (Unaudited) (Unaudited) (Restated) 9,023,724 5,680,658 41,779,529 25,349,767 1,506,225 3,449,494 701,370 405,129	fair values 30 June 2016 31 December 2015 *RMB’000* RMB’000 (Unaudited) (Unaudited) (Restated) 9,110,646 5,766,412 41,693,197 25,144,797 1,428,359 3,336,457 686,788 395,494 52,918,990 34,643,160
		53,010,848 34,885,048

Management has assessed that the fair values of cash and cash equivalents, restricted cash, trade and notes receivables, financial assets included in prepayments and other receivables, current portion of financial lease receivables and loans and receivables, trade and notes payables, financial liabilities included in other payables and accruals, current portion of corporate bonds and finance lease obligations, deposits from customers and current portion of bank and other borrowings approximate to their carrying amounts largely due to the short term maturities of these instruments.

Management has assessed that the fair values of the non-current portion of loans and receivables and noncurrent portion of deposits from customers of the Group approximates to their fair value due to their floating interest rates.

The Group’s finance department headed by the finance manager is responsible for determining the policies and procedures for the fair value measurement of financial instruments. The finance department reports directly to the chief financial officer. At each reporting date, the finance department analyses the movements in the values of financial instruments and determines the major inputs applied in the valuation. The valuation is reviewed and approved by the chief financial officer.

The fair value of the non-current portion of financial lease receivables, non-current portion of bank and other borrowings, non-current portion of corporate bonds and other long term payables has been calculated by discounting the expected future cash flows using rates currently available for instruments with similar terms, credit risk and remaining maturities.

China Shipping Container LineS Company Limited 66 InterIm rePOrt 2016

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

27. faIr VaLUe anD faIr VaLUe HIerarCHY of fInanCIaL InStrUmentS (Continued) financial assets measured at fair value

30 June 2016 Held-for-trading investments Available-for-sale investments	fair value measurement categorised into Level 1 Level 2 Level 3 total RMB’000 RMB’000 RMB’000 RMB’000 21,668 – – 21,668 744,337 – – 744,337
	766,005 – – 766,005

31 December 2015 Held-for-trading investments Available-for-sale investments	200,349 – – 200,349 892,134 – – 892,134
	1,092,483 – – 1,092,483

financial liabilities measured at fair value

30 June 2016 Derivative financial instruments	fair value measurement categorised into Level 1 Level 2 Level 3 total RMB’000 RMB’000 RMB’000 RMB’000 – 33,389 – 33,389

31 December 2015 Derivative financial instruments	– 838 – 838

During the period, there were no transfers of fair value measurements between Level 1 and Level 2 and no transfers into or out of Level 3 (six months ended 30 June 2015: Nil).

China Shipping Container LineS Company Limited InterIm rePOrt 2016 67

noteS to tHe InterIm ConDenSeD ConSoLIDateD fInanCIaL StatementS (Continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2016

28. eVent after tHe reportInG perIoD

There is no material subsequent event undertaken by the Group after 30 June 2016.

29. ComparatIVe amoUntS

As further explained in note 2.2, due to the application of merger accounting, certain comparative amounts have been restated.

In addition, the comparative interim condensed consolidated statement of profit or loss has been re-presented as if the operation discontinued during the period had been discontinued at the beginning of the comparative period.

China Shipping Container LineS Company Limited 68 InterIm rePOrt 2016

AI assistant

COSCO SHIPPING Development Co., Ltd. — Interim / Quarterly Report 2016

50782_rns_2016-09-28_9c1e4e8a-c238-4cf6-aba2-1e9e615f1f53.pdf

CONTENTS

Corporate InformatIon

DIreCtorS

EXECUTIVE DIRECTORS

NON-EXECUTIVE DIRECTORS

INDEPENDENT NON-EXECUTIVE DIRECTORS

nomInatIon CommIttee

remUneratIon CommIttee

aUDIt CommIttee

CHIef aCCoUntant

SUperVISorS

InVeStment StrateGY CommIttee

JoInt CompanY SeCretarIeS

aUtHorISeD repreSentatIVeS

LeGaL aDDreSS In tHe prC

prInCIpaL pLaCe of BUSIneSS In tHe prC

prInCIpaL pLaCe of BUSIneSS In HonG KonG

CompanY WeBSIte

H SHare LIStInG pLaCe

LIStInG Date

InternatIonaL aUDItor

nUmBer of H SHareS In ISSUe

DomeStIC aUDItor

BoarD Lot

LeGaL aDVISer

HonG KonG H SHare reGIStrar anD tranSfer

StoCK eXCHanGe StoCK CoDe

offICe

a SHare LIStInG pLaCe

LIStInG Date

prInCIpaL BanKerS

nUmBer of a SHareS In ISSUe

BoarD Lot

SHanGHaI StoCK eXCHanGe StoCK CoDe

teLepHone nUmBer

faX nUmBer

reSULtS anD BUSIneSS HIGHLIGHtS UnDer HonG KonG fInanCIaL reportInG StanDarDS (“HKfrS”)

manaGement DISCUSSIon anD anaLYSIS

1. DetaILS of reStrUCtUrInG:

1) Disposal of material assets

2) purchase of material assets

2. effeCt of reStrUCtUrInG

1) Changes in the Company's principal business

2) effect of vessel and container leasing transactions on the Company

anaLYSIS of operatInG enVIronment anD oUtLooK

1. maCroeConomIC ConDItIonS:

2. SHIppInG marKet:

3. VeSSeL anD ContaIner LeaSInG marKet

1) Industrial environment:

2) Competitive landscape:

4. ContaIner manUfaCtUrInG marKet

1) Industrial environment:

2) Competitive landscape:

5. fInanCIaL LeaSInG marKet for non-SHIppInG InDUStrIeS

1) Industrial environment:

2) Competitive landscape:

6. CompanY'S CoUntermeaSUreS

1) market forecast for the second half of 2016

2) Company's strategic ideas, operation goals and plans

A. Strategic positioning

B. Goals of development

C. Development plan

b.

Investment business

c.

Integrated financial services

anaLYSIS of SeGment reSULtS of tHe GroUp

1. anaLYSIS of reVenUe anD CoStS from LIner operatIonS

1) operating revenue

2) operating Costs

2. anaLYSIS of reVenUe anD CoStS from SHIppInG-reLateD LeaSInG BUSIneSS

1) operating revenue

2) operating Costs

3. anaLYSIS of reVenUe anD CoStS from ContaIner manUfaCtUrInG BUSIneSS

1) operating revenue

2) operating Costs

4. anaLYSIS of reVenUe anD CoStS from non-SHIppInG fInanCIaL LeaSInG BUSIneSS

COSCO SHIPPING Development Co., Ltd. Interim / Quarterly Report 2016