Dida Inc. — Capital/Financing Update 2013

Jul 19, 2013

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong 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.

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CHINA SHIPPING DEVELOPMENT COMPANY LIMITED 中海發展股份有限公司

(a joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 1138)

Supplementary Announcement regarding the Impact of the Fair Value Change of Investment Properties Held on Net Profits for 2011 and 2012 of the Company

Reference is made to the announcement dated 27 November 2012 regarding the proposed change of accounting treatment of investment properties and the 2012 annual report of China Shipping Development Company Limited (the “Company”).

According to the resolution passed at the meeting of the board of directors (the “Board”) of the Company on 27 November 2012, the Board approved the change of subsequent treatment model of investment properties held by the Company from the cost model to the fair value model with effect from 1 December 2012.

Based on the 2012 financial report audited by the Company’s auditors, such change in accounting policies had an impact on the net profits for 2011 (retrospective) and 2012 of the Company to the extent of approximately RMB15 million and approximately RMB336 million, respectively.

This announcement aims to provide more detailed information on the impact of the fair value change of investment properties held by the Company on its net profits for 2011 and 2012.

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I. Appraisal of assets

Messrs. China Tong Cheng Assets Appraisal Co., Ltd. issued assets appraisal reports in respect of investment properties as at 31 December 2011 and 31 December 2012, respectively, measured using the fair value model of the Company and the material contents of which are summarised below.

• (1) Investment properties measured using the fair value model as at 31 December 2011

• Appraisal date: 31 December 2011

• Subject and scope of appraisal: portion of offices and 72 underground parking lots of Building 5 of the Shanghai Port International Cruise Terminal (the “Building”), located at 670 Dong Da Ming Road, Hongkou District, Shanghai. The specific scope of appraisal comprise a portion of the 2nd floor, the entire 3rd to 5th floors and the underground 72 parking lots of the Building. The Building was completed in 2009 with reinforced concrete structure, the property ownership certificate no. of which is Hu Fang Di Hong Zi (2012) No. 010730. The gross floor area appraised is 5,422.82 square meters. The land use right was obtained by way of grant.

• Appraising method: the market-based approach was adopted for this appraisal.

• Conclusion of appraisal

As at 31 December 2011, i.e. the appraisal date, the book value of the assets appraised was approximately RMB235,955,100. Upon appraisal, the said assets was appraised at approximately RMB394,672,200. The appraised value exceeds the book value by approximately RMB158,717,100, or a value-added ratio of approximately 67.27%.

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5. Appraisal breakdown

								Value-
Sequence				Original	Book	Appraised	Increase/	added	Appraised
number	Property	GFA	Unit cost	carrying value	value	value	Decrease	ratio	unit price
		(m2)	(RMB/m2)	(RMB)	(RMB)	(RMB)	(RMB)		(RMB/m2)
1	Building 5 of	5,422.82	40,039.77	217,128,476.51	214,625,079.98	365,872,242.58	151,247,162.60	70.47%	67,469
	the Shanghai
	Port
	International
	Cruise Terminal
1.1	2nd floor	700.00	39,123.43	27,386,403.91	27,386,403.91
1.2	3rd floor	1,575.14	40,175.55	63,282,108.30	62,491,081.95
1.3	4th floor	1,575.14	40,175.55	63,282,108.30	62,491,081.95
1.4	5th floor	1,572.54	40,175.68	63,177,856.00	62,256,512.17
2	Underground	72 parking	300,000.00	21,600,000.00	21,330,000.00	28,800,000.00	7,470,000.00	35.02%	400,000
	parking lots	lots
Total				238,728,476.51	235,955,079.98	394,672,242.58	158,717,162.60	67.27%

• (2) Investment properties measured using the fair value model as at 31 December 2012

• Appraisal date: 31 December 2012

• Subject and scope of appraisal: offices, shops and parking lots except the 7th floor of Building 5 of the Shanghai Port International Cruise Terminal, located at 670 Dong Da Ming Road, Hongkou District, Shanghai. The specific scope of appraisal comprises the 1st to 6th floors, basement 1 and the 148 parking lots of basement 2 to 3 of the Building. The Building was completed in 2009 with reinforced concrete structure, the property ownership certificate number is Hu Fang Di Hong Zi (2012) No. 010730. The gross floor area appraised is 13,689.16 square meters. The land use right was obtained by way of grant.

• Appraising method: the market-based approach was adopted for this appraisal.

• Conclusion of appraisal

As at 31 December 2012, i.e. the appraisal date, the book value of the assets appraised was approximately RMB589,281,400. Upon appraisal, the said assets was appraised at approximately RMB1,193,458,400. The appraised value exceeds the book value by approximately RMB604,177,000, or a value-added ratio of approximately 102.53%.

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5. Appraisal breakdown

								Value-
Sequence				Original	Book	Appraised	Increase/	added	Appraised
number	Property	GFA	Unit cost	carrying value	value	value	Decrease	ratio	unit price
		(m2)	(RMB/m2)	(RMB)	(RMB)	(RMB)	(RMB)		(RMB/m2)
1	Building 5 of	13,689.16	41,152.61	563,344,633.67	544,913,932.81	1,119,458,437	574,544,504	105.44%	81,777
	the Shanghai
	Port
	International
	Cruise Terminal
1.1	Basement 1	3,492.86
			41,950.35	183,651,911.00	174,216,077.29
1.2	Basement 1	884.98
1.3	1st floor	465.08
			39,675.43	59,219,147.22	59,219,147.22
1.4	1st floor	1,027.51
1.5	2nd floor	1,520.71	40,178.35	61,099,624.45	60,414,964.35
1.6	3rd floor	1,575.14	40,175.55	63,282,108.30	60,909,029.24
1.7	4th floor	1,575.14	40,175.55	63,282,108.30	60,909,029.24
1.8	5th floor	1,572.54	40,175.68	63,177,856.00	60,677,065.77
1.9	6th floor	1,575.20	44,205.10	69,631,878.40	68,568,619.70
2	Underground	148 parking	300,000.00	44,400,000.00	44,367,484.40	74,000,000	29,632,516	66.79%	500,000
	parking lots	lots
Total				607,744,633.67	**589,281,417.21 **	1,193,458,437.00	604,177,019.79	102.53%

II. The Effect of the Valuation Surplus on the Company’s Net Profit for 2011 and 2012

After changing the subsequent measurement model of investment properties, the Company made retrospective adjustments to its financial information for 2011 based on the valuation result according to the relevant requirements of the Accounting Standard for Business Enterprises promulgated by the Ministry of Finance of the PRC. As a result, the capital reserve and net profit for 2011 were increased by approximately RMB105 million and approximately RMB15 million respectively, while the net profit for 2012 was increased by approximately RMB336 million.

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III. Opinion of the Audit Committee

The Audit Committee of the Company (comprising Mr. Lu Wenbin, Mr. Zhu Yongguang, Mr. Zhang Jun and Mr. Wang Wusheng at the time the Board approved the accounting treatment on 27 November 2012) is of the opinion that the accounting policy of measuring investment properties at fair value can reflect the value of the Group’s investment properties more fairly and is in compliance with the Accounting Standard for Business Enterprises promulgated by the Ministry of Finance of the PRC. Accordingly, the Audit Committee consented to the Group’s adoption of this accounting policy.

By order of the Board China Shipping Development Company Limited Yao Qiaohong Company Secretary

Shanghai, the People’s Republic of China

19 July 2013

As at the date of this announcement, the Board of Directors of the Company comprises Mr. Li Shaode, Mr. Xu Lirong, Mr. Zhang Guofa, Mr. Wang Daxiong, Ms. Su Min, Mr. Huang Xiaowen, Mr. Ding Nong, Mr. Han Jun and Mr. Qiu Guoxuan as executive Directors, Mr. Zhu Yongguang, Mr. Zhang Jun, Mr. Lu Wenbin, Mr. Wang Wusheng and Mr. Lin Junlai as independent non-executive Directors.

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