DFZQ — Interim / Quarterly Report 2017

Oct 27, 2017

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

(A joint stock company incorporated in the People’s Republic of China with limited liability under the Chinese corporate name “ 東方證券股份有限公司 ” and carrying on business in Hong Kong as “ 東方證券 ” (in Chinese) and “DFZQ” (in English))

(Stock Code: 03958)

THE THIRD QUARTERLY REPORT FOR THE YEAR 2017

The board (the “ Board ”) of directors (the “ Directors ”) of 東方證券股份有限公司 (the “ Company ”) is pleased to announce the unaudited results of the Company and its subsidiaries for the third quarter ended September 30, 2017, prepared in accordance with General Accepted Accounting Principles of the People’s Republic of China. This announcement is made pursuant to the Inside Information Provisions (as defined in The Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “ Hong Kong Stock Exchange ”) (the “ Listing Rules ”)) under Part XIVA of the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) and Rules 13.09(2) and 13.10B of the Listing Rules.

This announcement contains the Chinese original version and English translation of the “The Third Quarterly Report for the Year 2017 of Orient Securities Company Limited” as published on the website of the Shanghai Stock Exchange, and is provided for your reference only. In case of discrepancy between the Chinese version and the English version, the Chinese version shall prevail.

By order of the Board of Directors PAN Xinjun Chairman

Shanghai, PRC October 27, 2017

As at the date of this announcement, the Board of Directors comprises Mr. PAN Xinjun and Mr. JIN Wenzhong as executive Directors; Mr. WU Jianxiong, Mr. ZHANG Qian, Mr. WU Junhao, Mr. CHEN Bin, Mr. LI Xiang, Mr. XU Jianguo, Ms. HUANG Laifang and Mr. ZHOU Yao as non-executive Directors; and Mr. XU Guoxiang, Mr. TAO Xiuming, Mr. WEI Anning, Mr. XU Zhiming and Mr. JIN Qinglu as independent non-executive Directors.

– 1 –

ORIENT SECURITIES COMPANY LIMITED

THE THIRD QUARTERLY REPORT FOR THE YEAR 2017

– 2 –

CONTENTS

I.	IMPORTANT NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
II.	COMPANY PROFILE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
III.	MATERIAL EVENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
IV.	APPENDICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12

– 3 –

I. IMPORTANT NOTICE

• 1.1 The Board, the supervisory committee of the Company and its Directors, supervisors and senior management warrant that the information contained herein is true, accurate and complete and there are no false representations, misleading statements contained in or material omissions from this quarterly report, and severally and jointly accept legal liability.

• 1.2 All the Directors attended the 35th meeting of the 3rd session of the Board of the Company to consider and approve the third quarterly report for the year 2017. There was no objection from the Directors or supervisors to this report.

• 1.3 The person-in-charge of the Company, Mr. Pan Xinjun, and the accounting chief and person-incharge of the accounting department (head of the accounting department), Mr. Zhang Jianhui, warrant the truthfulness, accuracy and completeness of the financial statements set out in this quarterly report.

• 1.4 This third quarterly report of the Company was unaudited.

II. COMPANY PROFILE

2.1 Key financial data

Unit and Currency: RMB

			Increase/decrease
			recorded at the end
			of this reporting
			period as compared
			with the end of
	At the end of	At the end of	the previous year
	this reporting period	the previous year	(%)
Total assets	223,438,326,900.27	212,411,087,389.26	5.19
Net assets attributable to
the shareholders of
the Company	41,685,873,397.43	40,482,898,531.88	2.97
		From
	From	the beginning of
	the beginning of	the previous year	Increase/decrease
	the year to	to the end of	as compared with
	the end of	the reporting period	the corresponding
	this reporting period	of the previous year	period of
	(January to	(January to	the previous year
	September)	September)	(%)
Net cash flows from
operating activities	-15,498,651,940.31	-22,151,315,655.29	N/A

– 4 –

Unit and Currency: RMB

		From
	From	the beginning of
	the beginning of	the previous year	Increase/decrease
	the year to	to the end of	as compared with
	the end of	the reporting period	the corresponding
	this reporting period	of the previous year	period of
	(January to	(January to	the previous year
	September)	September)	(%)
Operating income	7,058,993,363.16	4,767,963,024.99	48.05
Net profit attributable to
the shareholders of
the Company	2,628,915,372.22	1,875,819,989.55	40.15
Net profit attributable to
the shareholders of
the Company after deducting
non-recurring profit or loss	2,414,308,887.36	1,725,212,199.35	39.94
Weighted average returns			Increase by 1.16
on net assets (%)	6.37	5.21	percentage points
Basic earnings per share
(RMB/Share)	0.42	0.34	23.53
Diluted earnings per share
(RMB/Share)	0.42	0.34	23.53

Non-recurring items and amounts

✓Applicable □Not Applicable

Unit and Currency: RMB

		Amounts from
		the beginning of
		the year to the end of
	Amounts for	this reporting period
	this period	(January to
Items	(July to September)	September)	Explanations
Gains and losses from	-181,747.52	335,927.85
disposals of non-current
assets
Government grants recognized	94,104.25	306,667,804.25	Representing
in current profit or loss,			primarily the key
excluding those closely			industry supporting
related to the Company’s			fund
normal operations and
granted on an ongoing basis
under the State’s policies
according to certain quota
of amount or volume

– 5 –

Unit and Currency: RMB

		Amounts from
		the beginning of
		the year to the end of
	Amounts for	this reporting period
	this period	(January to
Items	(July to September)	September)	Explanations
Other non-operating incomes	-1,004,606.68	-9,259,369.11
and expenses except items
above
Amount for the effect of	15,525.01	-8,701,787.38
non-controlling interests
(net of tax)
Amount for the effect of	273,062.48	-74,436,090.75
income tax
Total	-803,662.46	214,606,484.86

• 2.2 The table below sets out the total number of shareholders, and the shareholding of the top ten shareholders and the top ten shareholders of circulating shares (or shareholders not subject to restriction on sales) as at the end of the reporting period

						Unit: Share
Total number of shareholders (accounts)						167,822
	Shareholding of the top		ten shareholders
	Number of
	shares held
	as at the end of		Number of
	the reporting	Percentage	restricted			Nature of
Name of shareholders (full name)	period	(%)	shares held	Pledged	or frozen	shareholders
				Status of	Number of
				shares	shares
Shenergy (Group) Company Limited	1,537,522,422	24.74	1,537,522,422	Nil	–	State-owned legal
						person
Hong Kong Securities Clearing	1,026,968,400	16.52	–	Nil	–	Foreign legal person
Company Nominees Limited
China Securities Finance	304,548,332	4.90	–	Nil	–	State-owned legal
Corporation Limited						person
Shanghai Haiyan Investment	286,271,333	4.61	–	Nil	–	State-owned legal
Management Company Limited						person
Shanghai United Media Group	246,878,206	3.97	–	Nil	–	State-owned legal
						person
Shanghai Electric (Group) Corporation	194,073,938	3.12	194,073,938	Nil	–	State-owned legal
						person
China Post Group Corporation	178,743,236	2.88	–	Nil	–	State-owned legal
						person

– 6 –

Unit: Share

	Shareholding of the top	Shareholding of the top	ten shareholders	ten shareholders
	Number of
	shares held
	as at the end of		Number of
	the reporting	Percentage	restricted			Nature of
Name of shareholders (full name)	period	(%)	shares held	Pledged	or frozen	shareholders
				Status of	Number of
				shares	shares
Shanghai Jinqiao Export Processing	161,053,687	2.59	–	Nil	–	Domestic non-state-
Zone Development Co., Ltd.						owned legal person
(上海金橋出口加工區開發股份
有限公司)
Greatwall Information Industry	143,000,000	2.30	–	Pledged	20,000,000	Domestic non-state-
Co., Ltd.						owned legal person
Shanghai Construction Group Co., Ltd.	133,523,008	2.15	133,523,008	Nil	–	State-owned legal
						person

Shareholding of the top	ten shareholders of non-restricted shares	ten shareholders of non-restricted shares
	Number of
	circulating
	non-restricted
Name of shareholders	shares held	Type and number	of shares
		Type	Number
Hong Kong Securities Clearing	1,026,968,400	Overseas listed	1,026,968,400
Company Nominees Limited		foreign shares
China Securities Finance Corporation	304,548,332	RMB ordinary	304,548,332
Limited		shares
Shanghai Haiyan Investment	286,271,333	RMB ordinary	286,271,333
Management Company Limited		shares
Shanghai United Media Group	246,878,206	RMB ordinary	246,878,206
		shares
China Post Group Corporation	178,743,236	RMB ordinary	178,743,236
		shares
Shanghai Jinqiao Export Processing	161,053,687	RMB ordinary	161,053,687
Zone Development Co., Ltd.		shares
(上海金橋出口加工區開發股份
有限公司)
Greatwall Information Industry Co., Ltd.	143,000,000	RMB ordinary	143,000,000
		shares
Shanghai Educational Development	92,188,251	RMB ordinary	92,188,251
Co., Ltd. (上海市教育發展有限公司)		shares
Greenland Holding Group Company	79,513,111	RMB ordinary	79,513,111
Limited (綠地控股集團有限公司)		shares
National Council for Social Security	65,288,341	RMB ordinary	65,288,341
Fund (Transfer Account No.2)		shares
(全國社會保障基金理事會轉持二戶)

– 7 –

Related party relationship or parties acting in concert among above shareholders

• Shenergy (Group) Company Limited, Shanghai Electric (Group) Corporation and Shanghai Construction Group Co., Ltd. are the subsidiaries of the State-owned Assets Supervision and Administration Commission of Shanghai Municipal Government. The Company is not aware of any other related party relationship or any parties acting in concert among other shareholders.

• 2.3 The table below sets out the total number of preferred shareholders, and shareholding of top ten preferred shareholders and top ten preferred shareholders not subject to restriction on sales as at the end of the reporting period

□Applicable ✓Not Applicable

III. MATERIAL EVENTS

• 3.1 Material changes in major accounting statement items and financial indicators of the Company and the reasons for such changes

✓Applicable □Not Applicable

Unit and Currency: RMB

	As at	As at	Increase/
	September 30,	December 31,	Decrease
Items	2017	2016	(%)	Major reasons for the changes
Placements to banks and	3,500,000,000.00	0.00	N/A	Increase in placements to banks
other financial institutions				and other financial institutions
Financial assets at fair value	48,147,096,278.80	23,329,193,641.39	106.38	Increase in the size of financial
through profit or loss				assets held for trading purpose
Derivative financial assets	146,303,287.24	70,509,142.37	107.50	Increase in the assets arising
				from change in the fair value of
				derivatives
Held-to-maturity	110,500,000.00	212,059,726.75	-47.89	Decrease in the carrying value of
investments				held-to-maturity bonds
Deferred income tax assets	150,429,585.74	253,903,054.13	-40.75	Decrease in the deductible
				temporary differences
Short-term borrowings	960,817,818.03	480,726,662.50	99.87	Increase in the credit borrowings of
				subsidiaries
Short-term financial bills	2,552,407,000.00	4,942,779,000.00	-48.36	Decrease in the size of short-term
payables				commercial papers
Due to banks and other	11,100,000,000.00	5,100,000,000.00	117.65	Increase in the amounts due
financial institutions				to banks and other financial
				institutions
Financial liabilities at fair	5,165,832,151.49	7,471,177,366.88	-30.86	Mainly due to the decrease in the
value through profit or				size of short selling bonds
loss
Derivative financial	931,972,728.06	419,177,005.26	122.33	Increase in the cost of derivative
liabilities				financial liabilities
		– 8 –

Unit and Currency: RMB

	As at	As at	Increase/
	September 30,	December 31,	Decrease
Items	2017	2016	(%)	Major reasons for the changes
Funds payable to securities	770,000,000.00	587,550,000.00	31.05	Increase in the funds payable
issuers				to securities issuers by the
				subsidiaries
Taxes payable	277,882,690.40	411,827,929.52	-32.52	Mainly due to the decrease in
				the payable value-added tax and
				payable corporate income tax
Payables	370,385,347.79	222,299,338.20	66.62	Increase in the unsettled trade
				amounts of the subsidiaries
Other comprehensive income	234,645,366.06	728,268,800.21	-67.78	Due to change in fair value of
				available-for-sale financial assets
			Increase/
	January to	January to	Decrease
Items	September 2017	September 2016	(%)	Main reason for changes
Net interest income	-1,323,476,208.11	-545,475,646.08	N/A	Mainly due to the increase in the
				interest expense from financing
Investment gains	3,464,917,829.35	2,627,183,372.62	31.89	Increase in the gains from
(“-” indicating losses)				investment in financial
				instruments
Gains from changes	1,460,020,989.78	-476,878,724.06	N/A	Due to the change in the fair value
in fair value				of financial instruments
(“-” indicating losses)
Foreign exchange gains	-123,135,938.76	84,986,355.11	N/A	Influence of exchange rate
(“-” indicating losses)				fluctuations
Other business income	234,727,654.93	18,146,194.87	1,193.54	Increase in the revenue from sale of
				commodity by subsidiaries
Tax and surcharges	41,921,873.13	173,862,993.44	-75.89	Due to levying value-added tax
				in lieu of business tax
Business and administrative	3,838,751,893.55	2,366,886,152.17	62.19	The increase in operating income
expenses				led to an increase
				in corresponding expenses
Assets impairment loss	56,689,179.76	122,293,343.47	-53.64	Decrease in the impairment loss
				provided for available-for-sale
				financial assets
Other business cost	209,569,962.75	0.00	N/A	Increase in the cost from sale of
				commodity by subsidiaries
Non-operating income	309,400,236.99	217,865,535.94	42.01	Increase in government grants
Non-operating expenses	11,655,874.00	6,902,751.70	68.86	Mainly due to the increase
				in donation expense
Income tax expense	511,849,774.18	360,800,973.60	41.86	Due to increase in total profit
Other comprehensive	-493,133,482.41	-875,147,369.36	N/A	Due to change in fair value of
income, net of tax				available-for-sale financial assets

– 9 –

Unit and Currency: RMB

			Increase/
	January to	January to	Decrease
Items	September 2017	September 2016	(%)	Main reason for changes
Net cash flows	-15,498,651,940.31	-22,151,315,655.29	N/A	Mainly due to the increase in
from operating activities				amounts due to banks and other
				financial institutions and cash
				inflow from repurchase business
Net cash flows	-190,824,868.19	-889,300,334.78	N/A	Mainly due to the decrease in the
from investing activities				cash payable for investment
Net cash flows	1,863,511,648.28	6,843,704,202.99	-72.77	Mainly due to the decrease
from financing activities				in investment from shareholders

3.2 Analysis and description on the update impact and solutions of material events

✓Applicable □Not Applicable

On April 14, 2017, the Resolution in relation to the Non-public Issuance of A Shares of the Company and other resolutions were considered and passed at the first extraordinary general meeting in 2017, the first A Share class meeting in 2017 and the first H Share class meeting in 2017 of the Company. On July 24, 2017, the First Feedback Notice of Examination on Administrative Projects from the China Securities Regulatory Commission (the “ CSRC ”) (No. 171003) issued by CSRC was received, and has disclosed related feedback opinions in the form of interim announcement published on Shanghai Stock Exchange website and the Hong Kong Stock Exchange website on August 7, 2017, and has submitted written response and opinion to department accepting administrative approval of CSRC on August 8, 2017.

On August 7, 2017, the Company held the 32nd meeting of the third session of the Board and considered and approved the Resolution of Adjusting the Proposal of Non-public Issuance of A Shares of the Company and other relevant resolutions. According to the mandates granted to the Board in the 2017 first extraordinary general meeting, the 2017 first A Share class meeting and the 2017 first H Share class meeting, the Company adjusted the number of shares and amount of cash for subscription proposed by Shanghai Haiyan Investment Management Company Limited under the non-public issuance of shares according to the Proposal of Non-public Issuance of A Shares of the Company, and further clarified the use of proceeds arising from the non-public issuance.

On September 19, 2017, the Issuance Examination Committee of CSRC has reviewed the application of the Company for the non-public issuance of A shares; according to the result of the review, the Company’s application for the non-public issuance of A shares has been approved (announcement No.: 2017-070). As at the end of the reporting period, the Company has not yet received the written approval document from CSRC.

– 10 –

• 3.3 Undertakings that has not yet been duly fulfilled during the reporting period

• □Applicable ✓Not Applicable

• 3.4 Profit warning and explanation of expected accumulated net loss from the beginning of the year to the end of the next reporting period or material changes over the corresponding period of previous year

□Applicable ✓Not Applicable

Name of the Company ORIENT SECURITIES COMPANY LIMITED Legal representative Pan Xinjun Date October 27, 2017

– 11 –

IV. APPENDICES

4.1 Financial Statements

Consolidated Balance Sheet

As at September 30, 2017

Prepared by: ORIENT SECURITIES COMPANY LIMITED

Unit and Currency: RMB Type of audit: Unaudited

	Balance	Balance
	as at the end	as at the beginning
Items	of the period	of the year
Assets:
Cash and bank balances	31,013,524,199.90	44,168,734,819.24
Of which: Deposits held on behalf of customers	21,099,167,643.63	29,201,537,858.92
Clearing settlement funds	9,283,446,215.73	10,504,501,418.62
Of which: Settlement funds held on behalf of customers	6,733,364,155.55	7,466,989,689.01
Placements to banks and other financial institutions	3,500,000,000.00	0.00
Advance to customers	12,002,737,057.63	10,651,585,593.63
Financial assets at fair value through profit or loss	48,147,096,278.80	23,329,193,641.39
Derivative financial assets	146,303,287.24	70,509,142.37
Financial assets held under resale agreements	33,065,649,963.72	34,558,940,628.05
Receivables	1,428,816,586.45	1,748,220,157.51
Interest receivables	2,050,892,114.74	1,746,275,422.69
Deposits with exchanges and financial institutions	943,231,936.34	1,099,848,916.02
Dividend receivables
Assets classified as held for sale
Available-for-sale financial assets	74,574,727,886.96	77,261,927,834.81
Held-to-maturity investments	110,500,000.00	212,059,726.75
Long-term receivables
Long-term equity investments	3,415,112,851.14	3,514,660,031.96
Investment properties
Fixed assets	446,336,068.84	437,212,300.07
Construction in progress	1,517,860,119.87	1,345,009,212.72
Intangible assets	114,209,103.19	114,883,681.05
Development expenses
Goodwill	32,135,375.10	32,135,375.10
Leasehold improvements	59,779,325.43	62,264,581.77
Deferred tax assets	150,429,585.74	253,903,054.13
Other assets	1,435,538,943.45	1,299,221,851.38
Total assets	223,438,326,900.27	212,411,087,389.26

– 12 –

Unit and Currency: RMB Type of audit: Unaudited

	Balance	Balance
	as at the end	as at the beginning
Items	of the period	of the year
Liabilities:
Short-term borrowings	960,817,818.03	480,726,662.50
Short-term financial bills payables	2,552,407,000.00	4,942,779,000.00
Due to banks and other financial institutions	11,100,000,000.00	5,100,000,000.00
Financial liabilities at fair value through profit or loss	5,165,832,151.49	7,471,177,366.88
Derivative financial liabilities	931,972,728.06	419,177,005.26
Financial assets held under repurchase agreements	55,391,657,969.67	46,398,939,933.96
Account payable to brokerage clients	24,879,229,659.09	33,696,387,737.08
Funds payable to securities issuers	770,000,000.00	587,550,000.00
Securities brokerage for margin transaction	1,852,475,641.82	1,955,399,663.49
Accrued staff costs	1,426,171,436.32	1,377,921,333.53
Taxes payable	277,882,690.40	411,827,929.52
Payables	370,385,347.79	222,299,338.20
Interest payables	2,010,775,240.13	1,553,613,486.28
Dividend payable
Liabilities classified as held for sale
Provision
Long-term borrowings	819,063,941.48	859,033,902.23
Bond payables	71,235,464,597.82	64,584,110,872.54
Long-term payables
Long-term accrued staff costs
Special payables
Deferred tax liabilities	291,196,245.85	357,850,891.22
Deferred income
Other liabilities	1,205,639,791.49	1,054,466,917.23
Total liabilities	181,240,972,259.44	171,473,262,039.92

– 13 –

Unit and Currency: RMB Type of audit: Unaudited

			Balance	Balance
			as at the end	as at the beginning
Items			of the period	of the year
Equity (or equity of shareholders):
Share capital			6,215,452,011.00	6,215,452,011.00
Other equity instruments
Capital reserve		18,028,781,934.70		18,028,781,205.57
Less: treasury shares
Other comprehensive income			234,645,366.06	728,268,800.21
Special reserve
Surplus reserve			2,685,798,121.59	2,685,798,121.59
General reserve			5,755,612,472.29	5,712,872,683.97
Undistributed profits			8,765,583,491.79	7,111,725,709.54
Exchange differences from translation of statements
denominated in foreign currencies
Total equity attributable to owners (or shareholders) of
the parent company		41,685,873,397.43		40,482,898,531.88
Non-controlling interest			511,481,243.40	454,926,817.46
Total equity of owners (or equity of shareholders)		42,197,354,640.83		40,937,825,349.34
Total liabilities and equity of owners (or equity of
shareholders)		223,438,326,900.27		212,411,087,389.26
	Person-in-charge of
Legal representative:	the accounting department:		Accounting chief:
Pan Xinjun	Zhang Jianhui		Zhang Jianhui

– 14 –

Balance Sheet of the Parent Company

As at September 30, 2017

Prepared by: ORIENT SECURITIES COMPANY LIMITED

Unit and Currency: RMB Type of audit: Unaudited

	Balance	Balance
	as at the end	as at the beginning
Items	of the period	of the year
Assets:
Cash and bank balances	19,584,131,380.31	29,973,827,693.15
Of which: Deposits held on behalf of customers	14,440,934,310.85	19,682,886,139.74
Clearing settlement funds	5,229,242,286.19	6,493,772,468.87
Of which: Settlement funds held on behalf of customers	2,765,536,572.49	3,534,711,971.33
Placements to banks and other financial institutions	3,500,000,000.00	0.00
Advance to customers	11,704,283,667.21	10,291,010,805.73
Financial assets at fair value through profit or loss	35,674,824,651.00	16,916,320,704.96
Derivative financial assets	136,576,282.59	45,388,386.68
Financial assets held under resale agreements	32,829,190,848.38	34,114,781,904.15
Receivables	432,731,663.85	193,905,147.11
Interest receivables	1,845,891,190.72	1,634,618,785.94
Deposits with exchanges and financial institutions	745,939,541.68	899,280,526.67
Dividend receivables
Assets classified as held for sale
Non-current assets maturing within one year
Available-for-sale financial assets	69,428,130,664.10	71,172,997,355.91
Held-to-maturity investments	110,500,000.00	212,059,726.75
Long-term receivables
Long-term equity investments	11,312,947,278.07	9,745,566,215.91
Investment properties
Fixed assets	421,365,216.44	411,279,144.81
Construction in progress	1,508,809,443.70	1,341,935,220.92
Other intangible assets	102,841,977.93	105,735,999.24
Development expenses
Goodwill	18,947,605.48	18,947,605.48
Leasehold improvements	45,656,840.09	44,933,741.29
Deferred tax assets	0.00	114,684,207.68
Other assets	162,563,075.65	141,799,532.85
Total assets	194,794,573,613.39	183,872,845,174.10

– 15 –

Unit and Currency: RMB Type of audit: Unaudited

	Balance	Balance
	as at the end	as at the beginning
Items	of the period	of the year
Liabilities:
Short-term borrowings
Short-term financial bills payables	1,992,407,000.00	2,712,779,000.00
Due to banks and other financial institutions	11,100,000,000.00	5,100,000,000.00
Financial liabilities at fair value through profit or loss	4,726,869,476.20	7,207,691,470.00
Derivative financial liabilities	844,693,009.53	267,863,973.93
Financial assets held under repurchase agreements	50,239,152,158.52	44,865,441,113.41
Account payable to brokerage clients	15,582,297,287.61	20,948,554,652.40
Funds payable to securities issuers
Securities brokerage for margin transaction	1,195,361,971.78	1,702,899,629.95
Accrued staff costs	668,452,674.58	513,890,151.48
Taxes payable	23,545,888.19	188,049,368.18
Payables	10,863,393.55	31,982,523.46
Interest payables	1,894,641,615.18	1,471,310,418.91
Dividend payable
Liabilities classified as held for sale
Provision
Long-term borrowings
Bond payables	66,779,244,290.25	59,546,784,845.00
Long-term payables
Long-term accrued staff costs
Special payables
Deferred tax liabilities	203,355,169.32	266,049,958.95
Deferred income
Other liabilities	481,576,922.23	518,876,541.18
Total liabilities	155,742,460,856.94	145,342,173,646.85
Equity (or equity of shareholders):
Share capital	6,215,452,011.00	6,215,452,011.00
Other equity instruments
Capital reserve	17,978,031,823.98	17,978,031,823.98
Less: treasury shares
Other comprehensive income	32,901,800.49	429,126,830.37
Special reserve
Surplus reserve	2,685,798,121.59	2,685,798,121.59
General reserve	5,350,776,592.51	5,350,776,592.51
Undistributed profits	6,789,152,406.88	5,871,486,147.80
Exchange differences from translation of statements
denominated in foreign currencies
Total equity of owners (or shareholders)	39,052,112,756.45	38,530,671,527.25
Total liabilities and equity of owners (or shareholders)	194,794,573,613.39	183,872,845,174.10

Person-in-charge of Legal representative: the accounting department: Accounting chief: Pan Xinjun Zhang Jianhui Zhang Jianhui

– 16 –

For January to September 2017

Consolidated Income Statement

Prepared by: ORIENT SECURITIES COMPANY LIMITED

Unit and Currency: RMB Type of audit: Unaudited

					Amounts for
					the beginning of
				Amounts for	the previous year
			Amounts for	the beginning of	to the end of
			the corresponding	the year to	the reporting
		Amounts for	period of	the end of the	period of the
		this period	the previous year	reporting period	previous year
		(July to	(July to	(January to	(January to
Items		September)	September)	September)	September)
I.	Operating income	2,431,062,928.48	1,875,062,096.38	7,058,993,363.16	4,767,963,024.99
	Net fee and commission
	income	1,215,354,235.95	998,265,932.21	3,345,939,035.97	3,060,001,472.53
	Of which: Net fee income from brokerage
	business	416,948,329.52	383,294,418.12	1,100,767,988.92	1,226,283,708.14
	Net fee income from
	investment banking business	372,708,497.04	259,204,183.02	1,009,811,462.91	959,406,498.64
	Net fee income from asset
	management business	400,765,894.85	252,762,338.74	1,045,083,900.14	668,317,698.24
	Net interest income	-536,197,651.56	-183,850,106.85	-1,323,476,208.11	-545,475,646.08
	Investment gains (“-” indicating losses)	1,392,840,056.43	910,586,156.62	3,464,917,829.35	2,627,183,372.62
	Of which: Gains from investments in
	associates and joint ventures	55,120,790.00	88,461,112.42	228,564,205.80	221,231,074.42
	Gains from changes in fair value
	(“-” indicating losses)	274,015,522.21	104,688,630.82	1,460,020,989.78	-476,878,724.06
	Foreign exchange gains (“-” indicating
	losses)	-45,462,583.14	41,327,636.27	-123,135,938.76	84,986,355.11
	Other gains
	Other business income	130,513,348.59	4,043,847.31	234,727,654.93	18,146,194.87
II.	Operating expenses	1,402,443,103.05	1,114,541,635.86	4,146,932,909.19	2,663,042,489.08
	Tax and surcharges	13,420,751.18	15,495,859.81	41,921,873.13	173,862,993.44
	Business and administrative expenses	1,241,521,225.43	975,325,304.43	3,838,751,893.55	2,366,886,152.17
	Assets impairment loss	22,147,648.05	123,720,471.62	56,689,179.76	122,293,343.47
	Other business cost	125,353,478.39	0.00	209,569,962.75	0.00

– 17 –

Unit and Currency: RMB Type of audit: Unaudited

					Amounts for
					the beginning of
				Amounts for	the previous year
			Amounts for	the beginning of	to the end of
			the corresponding	the year to	the reporting
		Amounts for	period of	the end of the	period of the
		this period	the previous year	reporting period	previous year
		(July to	(July to	(January to	(January to
Items		September)	September)	September)	September)
III.	Operating profit (“-” indicating loss)	1,028,619,825.43	760,520,460.52	2,912,060,453.97	2,104,920,535.91
	Add: Non-operating income	785,469.48	389,540.04	309,400,236.99	217,865,535.94
	Less: Non-operating expenses	1,877,719.43	5,630,374.61	11,655,874.00	6,902,751.70
IV.	Total profit (“-” indicating loss)	1,027,527,575.48	755,279,625.95	3,209,804,816.96	2,315,883,320.15
	Less: Income tax expenses	138,175,729.35	156,574,438.52	511,849,774.18	360,800,973.60
V.	Net profit (“-” indicating net loss)	889,351,846.13	598,705,187.43	2,697,955,042.78	1,955,082,346.55
	Of which: Net profit attributable to
	owners (or shareholders) of
	the parent company	873,673,109.25	592,388,480.20	2,628,915,372.22	1,875,819,989.55
	Profit or loss of non-
	controlling interest	15,678,736.88	6,316,707.23	69,039,670.56	79,262,357.00
VI.	Other comprehensive income, net of tax	-60,382,678.34	574,557,907.01	-493,133,482.41	-875,147,369.36
	Other comprehensive income attributable to
	owners of the parent company, net of tax	-60,582,896.02	574,599,734.53	-493,623,434.15	-875,497,032.70

• (I) Other comprehensive income that will not subsequently be reclassified to profit or loss

• Remeasurement of changes in net liabilities or assets of defined benefit scheme

• Share of other comprehensive income of investees accounted for using equity method that will not be reclassified to profit or loss

– 18 –

Unit and Currency: RMB Type of audit: Unaudited

									Amounts for
									the beginning of
							Amounts for		the previous year
					Amounts for		the beginning of		to the end of
					the corresponding		the year to		the reporting
				Amounts for		period of	the end	of the	period of the
				this period	the previous year		reporting period		previous year
				(July to		(July to	(January to		(January to
Items				September)	September)		September)		September)
	(II)	Other comprehensive income that will
		subsequently be reclassified to profit
		or loss		-60,582,896.02	574,599,734.53		-493,623,434.15		-875,497,032.70
		1.	Share of other comprehensive
			income of investees accounted
			for using equity method that
			will be reclassified to profit or
			loss	-6,191,906.58	9,566,352.60		-7,037,419.70		10,482,966.90
		2.	Gains and losses from changes
			in fair value of available-for-
			sale financial assets	-23,954,016.72	562,383,849.33		-433,089,131.79		-900,325,106.96
		3.	Gains and losses from held-
			to-maturity investment
			reclassified as available-for-
			sale financial assets
		4.	Effective portion of hedging
			gains and losses from cash
			flows
		5.	Exchange differences from
			translation of financial
			statements denominated in
			foreign currencies	-30,436,972.72	2,649,532.60		-53,496,882.66		14,345,107.36
		6.	Others
	Other	comprehensive income attributable to
	minority interest, net of tax			200,217.68	-41,827.52		489,951.74		349,663.34
VII.	Total	comprehensive income		828,969,167.79	1,173,263,094.44		2,204,821,560.37		1,079,934,977.19
	Total	comprehensive income attributable to
	owners of the parent company			813,090,213.23	1,166,988,214.73		2,135,291,938.07		1,000,322,956.85
	Total	comprehensive income attributable to
	minority interest			15,878,954.56	6,274,879.71		69,529,622.30		79,612,020.34
VIII.	Earnings per		share:
	(I)	Basic (in RMB)		0.14		0.10		0.42	0.34
	(II)	Diluted (in RMB)		0.14		0.10		0.42	0.34
			Person-in-charge of
Legal representative: the accounting department:						Accounting chief:
Pan Xinjun			Zhang	Jianhui		Zhang Jianhui

– 19 –

Income Statement of the Parent Company

For January to September 2017

Prepared by: ORIENT SECURITIES COMPANY LIMITED

Unit and Currency: RMB Type of audit: Unaudited

					Amounts for
					the beginning of
				Amounts for	the previous year
			Amounts for	the beginning of	to the end of
			the corresponding	the year to	the reporting
		Amounts for	period of	the end of the	period of the
		this period	the previous year	reporting period	previous year
		(July to	(July to	(January to	(January to
Items		September)	September)	September)	September)
I.	Operating income	1,325,102,397.14	1,105,171,744.26	4,089,299,025.63	2,629,140,120.44
	Net fee and commission income	469,580,413.87	442,986,371.91	1,296,374,764.83	1,437,991,238.08
	Of which: Net fee income from brokerage
	business	352,731,350.40	333,134,952.73	919,566,335.72	1,071,851,953.74
	Net fee income from
	investment banking business	106,428,953.32	72,362,274.89	295,233,139.27	232,509,184.31
	Net fee income from asset
	management business
	Net interest income	-540,134,980.84	-224,010,436.16	-1,317,038,318.55	-674,310,581.19
	Investment gains (“-” indicating losses)	1,266,618,310.02	814,220,799.04	2,895,436,682.77	2,236,384,997.69
	Of which: Gains from investments in
	associates and joint ventures	57,649,400.03	79,065,218.68	202,697,925.59	225,532,381.26
	Gains from changes in fair value
	(“-” indicating losses)	162,033,161.72	35,703,052.88	1,276,082,967.77	-425,492,793.73
	Foreign exchange gains (“-” indicating
	losses)	-37,434,724.89	31,773,077.61	-80,569,012.15	33,300,012.06
	Other gains
	Other business income	4,440,217.26	4,498,878.98	19,011,940.96	21,267,247.53
II.	Operating expenses	703,989,409.54	630,072,369.67	2,241,836,423.81	1,511,501,652.55
	Tax and surcharges	9,005,325.33	11,202,948.97	29,407,988.01	119,989,591.54
	Business and administrative expenses	675,159,094.21	496,362,707.83	2,170,701,799.33	1,269,731,312.79
	Assets impairment loss	19,824,990.00	122,506,712.87	41,726,636.47	121,780,748.22
	Other business cost
III.	Operating profit (“-” indicating loss)	621,112,987.60	475,099,374.59	1,847,462,601.82	1,117,638,467.89
	Add: Non-operating income	710,533.25	50,680.00	230,777,682.40	146,159,888.14
	Less: Non-operating expenses	347,669.37	5,555,646.39	6,283,597.46	6,129,254.25
IV.	Total profit (“-” indicating loss)	621,475,851.48	469,594,408.20	2,071,956,686.76	1,257,669,101.78
	Less: Income tax expenses	66,487,512.46	85,588,206.85	221,972,626.03	69,856,581.41

– 20 –

Unit and Currency: RMB Type of audit: Unaudited

							Amounts for
							the beginning of
						Amounts for	the previous year
					Amounts for	the beginning of	to the end of
					the corresponding	the year to	the reporting
				Amounts for	period of	the end of the	period of the
				this period	the previous year	reporting period	previous year
				(July to	(July to	(January to	(January to
Items				September)	September)	September)	September)
V.	Net profit (“-” indicating net loss)			554,988,339.02	384,006,201.35	1,849,984,060.73	1,187,812,520.37
VI.	Other	comprehensive income, net of tax		-33,603,466.96	590,363,206.93	-396,225,029.88	-809,803,679.94
	(I)	Other comprehensive income that will
		not subsequently be reclassified to
		profit or loss
		1.	Remeasurement of changes
			in net liabilities or assets of
			defined benefit scheme
		2.	Share of other comprehensive
			income of investees accounted
			for using the equity method,
			which will not be reclassified
			to profit or loss
	(II)	Other comprehensive income that will
		subsequently be reclassified to profit
		or loss		-33,603,466.96	590,363,206.93	-396,225,029.88	-809,803,679.94
		1.	Share of other comprehensive
			income of investees accounted
			for using the equity method,
			which will be subsequently
			reclassified to profit or loss	1,076,019.47	4,286,675.03	7,350,963.06	5,203,289.33
		2.	Gains and losses from changes
			in fair value of available-for-
			sale financial assets	-34,679,486.43	586,076,531.90	-403,575,992.94	-815,006,969.27
		3.	Gains and losses from held-
			to-maturity investment
			reclassified as available-for-
			sale financial assets
		4.	Effective portion of hedging
			gains and losses from cash
			flows
		5.	Exchange differences from
			translation of financial
			statements denominated in
			foreign currencies
		6.	Others

– 21 –

Unit and Currency: RMB Type of audit: Unaudited

							Amounts for
							the beginning of
						Amounts for	the previous year
				Amounts for		the beginning of	to the end of
				the corresponding		the year to	the reporting
			Amounts for		period of	the end of the	period of the
			this period	the previous year		reporting period	previous year
			(July to		(July to	(January to	(January to
Items			September)	September)		September)	September)
VII.	Total	comprehensive income	521,384,872.06	974,369,408.28		1,453,759,030.85	378,008,840.43
VIII.	Earnings per share:
	(I)	Basic (in RMB)	0.09		0.07	0.30	0.22
	(II)	Diluted (in RMB)	0.09		0.07	0.30	0.22
			Person-in-charge of
Legal representative:			the accounting department:		Accounting chief:
Pan Xinjun			Zhang Jianhui		Zhang Jianhui

– 22 –

Consolidated Statement of Cash Flows

For January to September 2017

Prepared by: ORIENT SECURITIES COMPANY LIMITED

Unit and Currency: RMB Type of audit: Unaudited

			Amount for
		Amount for	the beginning of
		the beginning of	the previous year
		the year to	to the end of the
		the end of this	reporting period of
		reporting period	the previous year
		(January to	(January to
Items		September)	September)
I.	Cash flows from operating activities:
	Net increase in disposal of financial assets
	at fair value through profit or loss	-19,709,433,423.78	2,523,169,148.95
	Cash received from interests, fees and commissions	6,184,965,737.08	6,760,499,875.48
	Net increase in due to banks and other financial
	institutions	2,500,000,000.00	-7,700,000,000.00
	Net increase in cash from repurchase business	10,507,300,040.02	-8,809,743,671.74
	Net decrease in advances to customers	0.00	4,728,599,077.36
	Net cash received from securities trading agency
	services
	Cash received relating to other operating activities	2,726,992,015.73	1,518,523,009.69
	Subtotal of cash inflows from operating activities	2,209,824,369.05	-978,952,560.26
	Net increase in advances to customers	1,368,007,366.42	0.00
	Net cash paid for securities trading agency services	8,736,045,567.63	12,173,930,824.55
	Cash paid for interests, fees and commissions	2,041,525,393.34	2,003,612,966.73
	Cash paid to and paid for staff	2,536,819,314.75	2,437,257,679.53
	Taxes paid	679,276,212.62	2,400,460,508.58
	Cash paid relating to other operating activities	2,346,802,454.60	2,157,101,115.64
	Sub-total of cash outflows from operating activities	17,708,476,309.36	21,172,363,095.03
	Net cash flows from operating activities	-15,498,651,940.31	-22,151,315,655.29
II.	Cash flows from investing activities:
	Cash received from disposal of investment	204,486,790.50	221,532,053.43
	Cash received from investment gains	157,284,625.14	367,075,565.34
	Net cash received from disposal of subsidiaries and
	other business units
	Cash received from other investing activities	5,825,426.42	1,108,368.38
	Sub-total of cash inflows from investing activities	367,596,842.06	589,715,987.15
	Cash paid for investments	226,577,186.34	1,025,272,425.73
	Cash paid for purchase of fixed assets, intangible
	assets and other long-term assets	321,844,523.91	252,218,896.20
	Net cash paid for acquisition of subsidiaries
	and other business units
	Cash paid for other investing activities	10,000,000.00	201,525,000.00
	Sub-total of cash outflows from investing activities	558,421,710.25	1,479,016,321.93
	Net cash flows from investing activities	-190,824,868.19	-889,300,334.78

– 23 –

Unit and Currency: RMB Type of audit: Unaudited

				Amount for
			Amount for	the beginning of
			the beginning of	the previous year
			the year to	to the end of the
			the end of this	reporting period of
			reporting period	the previous year
			(January to	(January to
Items			September)	September)
III.	Cash flows from financing activities:
	Proceeds from investments		980,000.00	6,305,662,179.78
	Of which: Cash contribution from minority interest
	to subsidiaries		980,000.00	10,961,100.00
	Cash received from borrowings		517,933,469.13	0.00
	Cash received from issue of bonds	31,633,596,000.00		30,067,956,897.80
	Cash received relating to other financing activities		512,000.00	0.00
	Sub-total of cash inflows from financing activities	32,153,021,469.13		36,373,619,077.58
	Cash repayment of debts	27,250,790,006.48		25,914,841,133.33
	Cash paid for distribution of dividends, profits
	or interest payment		3,038,494,814.37	3,604,216,739.54
	Of which: Dividends and profits paid to minority
	interest by subsidiaries		13,732,363.28	6,317,633.52
	Cash paid relating to other financing activities		225,000.00	10,857,001.72
	Sub-total of cash outflows from financing activities	30,289,509,820.85		29,529,914,874.59
	Net cash flows from financing activities		1,863,511,648.28	6,843,704,202.99
IV.	Effect of foreign exchange rate changes on cash
	and cash equivalents		-136,024,002.62	84,986,355.11
V.	Net increase in cash and cash equivalents	-13,961,989,162.84		-16,111,925,431.97
	Add: Balance of cash and cash equivalents
	at the beginning of the period	50,283,058,520.18		61,522,861,766.96
VI.	Balance of cash and cash equivalents at the end of
	the period	36,321,069,357.34		45,410,936,334.99
	Person-in-charge of
Legal	representative: the accounting department:		Accounting chief:
Pan Xinjun Zhang Jianhui			Zhang Jianhui

– 24 –

Cash Flow Statement of the Parent Company For January to September 2017

Prepared by: ORIENT SECURITIES COMPANY LIMITED

Unit and Currency: RMB Type of audit: Unaudited

			Amount for
		Amount for	the beginning of
		the beginning of	the previous year
		the year to	to the end of the
		the end of this	reporting period of
		reporting period	the previous year
		(January to	(January to
Items		September)	September)
I.	Cash flows from operating activities:
	Net increase in disposal of financial assets
	at fair value through profit or loss	-15,543,044,093.87	5,664,799,159.00
	Cash received from interests, fees and commissions	3,588,992,923.48	4,538,209,811.66
	Net increase in due to banks and other financial
	institutions	2,500,000,000.00	-7,700,000,000.00
	Net increase in funds from repurchase business	6,659,302,100.88	-9,727,100,043.94
	Net decrease in advances to customers	0.00	4,387,320,818.96
	Net cash received from securities trading agency
	services
	Cash received relating to other operating activities	618,971,415.27	569,221,896.60
	Sub-total of cash inflows from operating activities	-2,175,777,654.24	-2,267,548,357.72
	Net increase in advances to customers	1,413,272,861.48	0.00
	Net cash paid for securities trading agency services	5,873,795,022.96	7,671,202,340.47
	Cash paid for interests, fees and commissions	1,969,859,246.66	1,939,576,135.26
	Cash paid to and paid for staff	1,351,667,532.56	1,569,279,252.26
	Taxes paid	252,088,312.55	1,974,929,992.02
	Cash paid relating to other operating activities	630,165,827.06	375,239,778.05
	Sub-total of cash outflows from operating activities	11,490,848,803.27	13,530,227,498.06
	Net cash flows from operating activities	-13,666,626,457.51	-15,797,775,855.78
II.	Cash flows from investing activities:
	Cash received from disposal of investment
	Cash received from investment gains	142,667,826.49	94,000,000.00
	Cash received from other investing activities	5,704,029.37	1,085,203.38
	Subtotal of cash inflows from investing activities	148,371,855.86	95,085,203.38
	Cash paid for investments	1,500,000,000.00	1,447,100,000.00
	Cash paid for purchase of fixed assets, intangible
	assets and other long-term assets	297,768,152.99	233,512,175.99
	Cash paid for other investing activities
	Subtotal of cash outflows from investing activities	1,797,768,152.99	1,680,612,175.99
	Net cash flows from investing activities	-1,649,396,297.13	-1,585,526,972.61

– 25 –

Unit and Currency: RMB Type of audit: Unaudited

				Amount for
			Amount for	the beginning of
			the beginning of	the previous year
			the year to	to the end of the
			the end of this	reporting period of
			reporting period	the previous year
			(January to	(January to
Items			September)	September)
III.	Cash flows from financing activities:
	Cash received from investments		0.00	6,354,626,403.57
	Cash received from borrowings
	Cash received from issue of bonds	31,633,596,000.00		26,303,387,150.60
	Cash received relating to other financing activities
	Sub-total of cash inflows from financing activities	31,633,596,000.00		32,658,013,554.17
	Cash repayment of debts	25,129,430,264.14		23,724,314,758.13
	Cash paid for distribution of dividends, profits
	or interest payment		2,761,800,464.59	3,385,311,337.33
	Cash paid for other financing activities		0.00	7,354,905.66
	Sub-total of cash outflows from financing activities	27,891,230,728.73		27,116,981,001.12
	Net cash flows from financing activities		3,742,365,271.27	5,541,032,553.05
IV.	Effect of foreign exchange rate changes on cash
	and cash equivalents		-80,569,012.15	33,300,012.06
V.	Net increase in cash and cash equivalents	-11,654,226,495.52		-11,808,970,263.28
	Add: Balance of cash and cash equivalents
	at the beginning of the period	36,467,600,162.02		43,959,135,037.06
VI.	Balance of cash and cash equivalents at the end of
	the period	24,813,373,666.50		32,150,164,773.78
	Person-in-charge of
Legal	representative: the accounting department:		Accounting chief:
Pan Xinjun Zhang Jianhui			Zhang Jianhui

4.2 Auditors’ Report

□Applicable ✓Not Applicable

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