Dida Inc. — Interim / Quarterly Report 2016

Oct 28, 2016

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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COSCO SHIPPING ENERGY TRANSPORTATION CO., LTD. 中遠海運能源運輸股份有限公司

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

(Stock Code: 1138)

Third Quarterly Report of 2016

Summary

This Report for the three months ended 30 September 2016 of the Group has been prepared in accordance with the regulations on Disclosure of Information in Quarterly Reports for Listed Companies issued by the China Securities Regulatory Commission. This Report is published simultaneously in Shanghai and Hong Kong. All financial information set out in this Report is unaudited and prepared in accordance with the PRC GAAP.

This announcement is made pursuant to Rule 13.10B of The Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

1. IMPORTANT

This third quarterly report (the “Report”) for the three months ended 30 September 2016 (the “Reporting Period”) of COSCO SHIPPING Energy Transportation Co., Ltd. (the “Company”, together with its subsidiaries, the “Group”) has been prepared in accordance with the regulations on Disclosure of Information in Quarterly Reports for Listed Companies issued by the China Securities Regulatory Commission. The Report is published simultaneously in Shanghai of the People’s Republic of China (the “PRC”) and the Hong Kong Special Administrative Region. All financial information set out in the Report is unaudited and prepared in accordance with the accounting principles generally accepted in the PRC (the “PRC GAAP”).

— 1 —

2. PARTICULARS OF THE COMPANY

Principal financial data and statistics highlights

			**As at 30 **	September	September	September	As at 31 December 2015	As at 31 December 2015	As at 31 December 2015			Increase/
						2016	After adjusted Before adjusted				Decrease (%)
	Total assets (RMB)		57,700,514,990.60				85,617,121,545.03 66,965,190,850.38					-32.61
	Net assets	attributable to
	shareholders of the Company
	(RMB)		27,224,073,150.50				31,744,539,677.48 25,101,977,845.28					-14.24
			For the nine months				For the nine months ended
			**ended 30 **	September				30 September 2015				Increase/
						2016	After adjusted Before adjusted				Decrease (%)
	Net cash flow from operating
	activities (RMB)		14,903,995,800.26				5,405,462,232.25 3,673,017,232.25					175.72
	Revenue from operation (RMB)		10,715,772,117.93				12,986,880,069.64 9,279,798,069.64					-17.49
	Net profit attributable to
	shareholders of the Company
	(RMB)		2,224,067,921.69				1,328,466,704.77 690,621,704.77					67.42
	Net profit attributable to
	shareholders of the Company
	after exceptional items (RMB)		775,733,230.83				839,035,125.80 839,035,125.80					-7.54
	Rate of returns on net assets (%)									Increase by 3.91
	(weighted)					7.25			3.34 2.77	percentage points
	Basic earnings per share (RMB)				0.5516			0.3354 0.1744				216.28
	Diluted earnings per share (RMB)				0.5516			0.3354 0.1732				218.48

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			**For **	the three months For the nine months	the three months For the nine months
			ended 30 September ended 30 September
	**Exceptional items and am **		ount	2016 2016
	Items			Amount (RMB) Amount (RMB)		Notes
	Profit and Loss on disposal		of non-current
	assets			-368,088.88 -2,533,107.78
	Government grants included in gains or losses
	for the current period, excluding those
	closely related to the Company’s ordinary
	business and granted on an on-going basis
	in fixed amount or volume according to					The Company received
	certain standards and adhering to certain					the ship breaking
	principles under national		policies	220,239,111.53 222,140,768.60		grants.
						The subsidiary
						acquired in the
						combination of
	Net profit and loss of the subsidiary acquired					business under
	in the combination of business under					common control,
	common control from the beginning of the					generated net profit
	period to the date of combination				628,586,112.22	before it was acquired.
	Gains and losses from changes in fair value
	of investment properties subsequently
	measured at fair value			6,691,634.31 3,750,354.72
	Other non-operating income		and expenses
	except for the aforesaid items			-41,018,703.39 -49,077,554.36
						During January to
						September of the year,
						the Company
						generated investment
						income from the
						disposal of subsidiary,
	Other profits or losses within the definition of					China Shipping Bulk
	extraordinary profit or loss				966,852,489.37	Carrier Co., Limited.
	Income tax effect			-85,568,326.24 -353,421,716.13
	Minority interests effect (after tax)				-1,287,864.89
	Total			99,975,627.33 1,415,009,481.75

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• 2.2 Total number of shareholders as at the end of the Reporting Period, the shareholding of the top 10 shareholders and the shareholding of the top 10 shareholders of shares without any selling restrictions

			Total number of shareholders	Total number of shareholders	Total number of shareholders							128,053	128,053
						**Top 10 **	shareholders
									Number of		Number of
									shares with		shares subject
						Number of	Shareholding			selling	to pledge or	Type of
			Name of shareholders (Full Name)			shares	(%)		restrictions		lock up	shareholders
			China Shipping (Group) Company(1)									Stated-owned
			(中國海運(集團)總公司)			1,536,924,595	38.12			0	Nil	entity
												Offshore
			HKSCC NOMINEES LIMITED(2)			1,284,620,996	31.86			0	Unknown	entity
			Central Huijin Assets Management
			Company Ltd (中央匯金資產管理有									Stated-owned
			限責任公司)			92,709,700	2.3			0	Nil	entity
			China Securities Finance Co.,		Ltd.							Stated-owned
			(中國證券金融股份有限公司)			38,180,505	0.69			0	Nil	entity
			Harvest Fund	- Agricultural Bank of
			China - Harvest CSI Financial Asset
			Management Plan (嘉實基金—農業
			銀行—嘉實中證金融資產管理計劃)			24,879,500	0.62			0	Nil	Others
			Zhongou Fund - Agricultural Bank of
			China - Zhongou CSI Financial
			Asset Management Plan (中歐基金—
			農業銀行—中歐中證金融資產管理計
			劃)			24,879,500	0.62			0	Nil	Others
			GF Fund - Agricultural Bank of China -
			GF CSI Financial Asset Management
			Plan (廣發基金—農業銀行—廣發中
			證金融資產管理計劃)			24,879,500	0.62			0	Nil	Others
			Agricultural Bank of China Company
			Limited - Wells Fargo CSI
			State-owned Enterprises Reform
			Index Classification Securities
			Investment	Fund (中國農業銀行股份
			有限公司—富國中證國有企業改革指
			數分級證券投資基金)			17,821,565	0.44			0	Nil	Others
			National Social Security Fund Portfolio
			407 (全國社保基金四零七組合)			12,726,446	0.32			0	Nil	Others

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					Top 10 shareholders (continued)	Top 10 shareholders (continued)	Top 10 shareholders (continued)	Top 10 shareholders (continued)	Top 10 shareholders (continued)	Top 10 shareholders (continued)
										**Number **	of			**Number **		of
										shares with			shares subject
						**Number **	of		Shareholding selling					to pledge or			Type of
	**Name of **	**shareholders **		(Full Name)		shares			(%) restrictions						lock up		shareholders
	**Southern **	Fund - Agricultural Bank of
	**China **	- Southern CSI Financial
	Asset Management Plan (南方基金
	—農業銀行—南方中證金融資產管理
	計劃)					12,596,453			0.31		0				Nil		Others
	Top ten holders of shares in circulation without any selling restrictions(3)
									Number of shares in
							circulation without any selling
								restrictions as at the end of
	**Name of **	**Shareholders **		(full name)					the reporting period							Type of shares
	China Shipping (Group) Company(1)									1,536,924,595					RMB ordinary shares
	HKSCC NOMINEES LIMITED(2)									1,284,620,996					Offshore listed H shares
	Central Huijin Assets Management Company Ltd									92,709,700					RMB ordinary shares
	China Securities Finance Co., Ltd.									38,180,505					RMB ordinary shares
	Harvest Fund - Agricultural Bank of China -
	Harvest CSI Financial Asset Management					Plan				24,879,500					RMB ordinary shares
	Zhongou	Fund - Agricultural Bank of China				-
	Zhongou CSI Financial Asset Management Plan									24,879,500					RMB ordinary shares
	GF Fund	- Agricultural		Bank of China - GF		CSI
	Financial Asset		Management Plan							24,879,500					RMB ordinary shares
	Agricultural Bank		of China Company Limited -
	Wells Fargo CSI State-owned Enterprises					Reform
	Index Classification			Securities Investment Fund						17,821,565					RMB ordinary shares
	National Social Security Fund Portfolio				407					12,726,446					RMB ordinary shares
	Southern	Fund — Agricultural Bank of			China -
	Southern CSI Financial Asset Management Plan									12,596,453					RMB ordinary shares

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Notes:

• (1) As at the end of the Reporting Period, China Shipping (Group) Company (“China Shipping”) and its subsidiaries held 7,000,000 A Shares of the Company through CICC-CCB-Zhongjin Ruihe collective asset management schemes (中金公司—建設銀行—中金瑞和集合資產管理計劃), held 2,065,494 A Shares of the Company through Guotai Junan securities asset management-Industrial Bank - Guotai Junan Junxiang Xinli No.6 collective asset management schemes (國泰君安證券資管—興業銀行—國泰君安君享新利六號集合資產管理計劃) and held 8,641,504 A Shares of the Company through AEGON-INDUSTRIAL Fund-Bank of Shanghai-China Shipping (Group) Company (興業全球基金—上海銀行—中國海運(集團) 總公司). Therefore, China Shipping and its subsidiaries aggregately held 1,554,631,593 A Shares of the Company as at the end of the Reporting Period, representing 38.56% of the total number of shares of the Company.

• (2) HKSCC NOMINEES LIMITED (香港中央結算(代理人)有限公司) holds H shares of the Company on behalf of customers of all securities firms in Hong Kong and other CCASS participants.

• (3) The Company has no shareholder of restricted shares, therefore the top 10 shareholders are the same as the top 10 shareholders of unrestricted shares. No connected relationship exists between the 1st shareholder and the 2nd to 10th shareholders, but it is unknown whether connected relationship or concerted action relationship exist among the 2nd to 10th shareholders.

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3. SIGNIFICANT EVENTS

• 3.1 Significant changes in the principal items and highlights in the financial statements of the Company during the Reporting Period and the reasons

Unit: RMB

										Reason for
										Significant
	**Balance **	Sheet Item		2016.09.30			2015.12.31	Change(%)		Changes
	Cash and Cash Equivalents			9,615,319,644.47			4,908,977,899.22	95.87		Note(1)
	Notes Receivable			67,288,499.38			470,289,495.61	-85.69		Note(2)
	Accounts Receivable			1,253,234,183.44			2,321,006,698.63	-46.00		Note(2)
	Interests	receivable					3,572,671.63	-100.00		Note(3)
	Dividends receivable			1,225,556.33			292,548,430.38	-99.58		Note(4)
	Other receivables			186,374,157.22			315,108,013.83	-40.85		Note(2)
	Inventory			353,395,352.70			715,085,657.98	-50.58		Note(2)
	Other current assets			2,576,450.16			767,651,334.99	-99.66		Note(2)
	Long-term receivables			1,257,340,850.06			2,119,286,105.71	-40.67		Note(5)
	Long-term equity investment			3,925,913,899.50			8,228,262,098.02	-52.29		Note(2)
	Fixed assets			29,233,984,249.52			55,494,366,003.87	-47.32		Note(2)
	Long-term deferred expenses			1,958,742.99			8,700,496.93	-77.49		Note(2)
	Deferred	income tax asset		4,225,733.80			486,992,823.47	-99.13		Note(2)
	Short-term borrowings			2,663,512,201.85			5,789,593,406.22	-53.99		Note(6)
	Receipts	in advance		303,517,029.90			530,834,690.42	-42.82		Note(2)
	Taxes payable			87,855,005.67			182,069,631.25	-51.75		Note(7)
	Other payables			444,809,054.33			214,618,370.88	107.26		Note(8)
	Long-term borrowings			13,793,455,885.76			32,411,922,195.71	-57.44		Note(9)
	Long-term payables			881,007,885.45			1,553,542,641.99	-43.29		Note(2)
	Other non-current liabilities			826,708,111.55			411,385,025.09	100.96		Note(10)
	Capital reserve			7,597,367,292.44			14,226,642,078.95	-46.60		Note(11)
	Specific reserve			57,401,421.82			82,625,287.88	-30.53		Note(2)
	Other comprehensive income			-176,641,320.51			-489,808,810.51	63.94		Note(2)
	Minority	interests		-425,769,399.50			862,873,493.23	-149.34		Note(2)

Notes:

• (1) Cash and cash equivalents increased by 95.87% as compared to the beginning of the period, primarily because the Company received the prepayment of borrowings from the disposal of subsidiary China Shipping Bulk Carrier Co., Limited (“CS Bulk”).

• (2) These items decreased significantly primarily because the portion of these items that belong to CS Bulk ceased to be reflected in the consolidated statement of the Company after the disposal of subsidiary CS Bulk;

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• (3) Interests receivable decreased by 100% as compared to the beginning of the period, primarily because the Company received the interests repayable to the Company by CS Bulk.

• (4) Dividend receivables decreased by 99.58% as compared to the beginning of the period, primarily because the Company received dividends from its joint ventures.

• (5) Long-term receivables decreased by 40.67% as compared to the beginning of the period, primarily because the Company recovered its borrowings to a disposed joint venture.

• (6) Short-term borrowings decreased by 53.99% as compared to the beginning of the period, primarily because the Company repaid part of its short-term borrowings.

• (7) Taxes payable decreased by 51.75% as compared to the beginning of the period, primarily due to the Company having paid certain of its taxes.

• (8) Other payables increased by 107.26% as compared to the beginning of the period, primarily due to the compensations outstanding for the delivery period following the significant assets reorganization of the Company.

• (9) Long-term borrowings decreased by 57.44% as compared to the beginning of the period, primarily because the Company repaid part of its borrowings.

• (10) Other non-current liabilities increased by 100.96% as compared to the beginning of the period, primarily due to the changes in value of an interest rate swap contract.

• (11) Capital reserve decreased by 46.60% as compared to the beginning of the period, primarily because the acquisition under the business combination under common control has not yet completed, nor has the consideration been paid at the beginning of the retrospective period, as a result of which the then net capital assets of the proposed acquirer were reflected in the capital reserve of the consolidated statement. At the end of this period, the capital reserve decreased significantly because the acquisition has been completed and the capital reserve retrospectively consolidated at the beginning of the period has been written down in recognition of the payment of the acquisition consideration.

Income Statement Items January to September 2016 January to September 2015 Change (%) Reason for Significant Changes Gain from changes in fair value 3,750,354.72 6,718,000.00 -44.17 Note(12) Investment income 1,286,723,070.51 257,480,123.11 399.74 Note(13) Non-operating revenue 233,335,852.39 1,255,731,389.22 -81.42 Note(14) Non-operating expenditure 215,714,755.33 1,206,665,158.82 -82.12 Note(15) Income tax 137,540,177.92 -48,311,505.64 384.69 Note(16)

Notes:

• (12) Gain from changes in fair value from January to September for the year decreased by 44.17% as compared to the corresponding period of the previous year, primarily due to the changes in fair value of the interest swap rate contract of Dalian Ocean Shipping Company Limited (“Dalian Ocean”).

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• (13) Investment income from January to September for the year increased by 399.74% as compared to the corresponding period of the previous year, primarily due to the investment income generated from the disposal of the subsidiary CS Bulk by the Company.

• (14) Non-operating revenue from January to September for the year decreased by 81.42% as compared to the corresponding period of the previous year, primarily due to the significant amount of ship breaking grants received for the corresponding period of the previous year.

• (15) Non-operating expenditure from January to September for the year decreased by 82.12% as compared to the corresponding period of the previous year, primarily due to the scrap of a large number of vessels for the corresponding period of the previous year.

• (16) Income tax from January to September for the year increased by 384.69% as compared to the corresponding period of the previous year, primarily due to the revenue generated from the disposal of subsidiary CS Bulk and the better performance of the major business from January to September for the year as compared to the corresponding period of the previous year.

	Cash Flow Statement Items January to September 2016 January to September 2015 Change(%) Reason for Significant Changes Net cash flow from operating activities 14,903,995,800.26 5,405,462,232.25 175.72 Note(17) Net cash flow from investing activities 5,081,290,432.31 -3,878,800,714.98 231.00 Note(18) Net cash flow from financing activities -15,391,074,701.68 -1,942,718,405.70 -692.24 Note(19)

Notes:

• (17) Net cash flows generated from operating activities from January to September for the year increased by 175.72% as compared to the corresponding period of the previous year, primarily due to the increase in cash from operating activities and recovery of the advances to CS Bulk by the Company as a result of the disposal of CS Bulk.

• (18) Net cash flows generated from investing activities from January to September for the year increased by 231.00% as compared to the corresponding period of the previous year, primarily due to the increase in cash flow from investing activities as a result of the disposal of CS Bulk by the Company.

• (19) Net cash flows generated from financing activities from January to September for the year decreased by 692.24% as compared to the corresponding period of the previous year, primarily due to the repayment of some borrowings by the Company in light of its cash sufficiency.

3.2 Analysis and explanation on the progress of significant events and their impacts and solutions

Pursuant to the asset transfer agreement entered into among the Company, China Ocean Shipping (Group) Company (“COSCO Company”) and China COSCO Bulk Shipping (Group) Co., Ltd. (“COSCO Bulk”) on 29 March 2016 (the “Asset Transfer Agreement”), the Company has paid COSCO Company the shortfall

— 9 —

between the considerations for the assets disposed and the assets acquired under the major asset restructuring on 15 July 2016. As such, the material asset restructuring has been completed. Please refer to the announcement in relation to the progress of the implementation of the material asset restructuring published by the Company on 16 July 2016, 20 July 2016 and 19 August 2016 on the website of the Shanghai Stock Exchange (www.sse.com.cn) for details.

According to the Asset Transfer Agreement, the Company has appointed Baker Tilly China Certified Public Accountants to audit the profit and loss during the transition period and other change of equities of the assets disposed and has appointed Ruihua Certified Public Accountants to audit the profit and loss during the transition period and other change of equities of the assets acquired with 30 June 2016 as the reference date of the closing audit. At present, the relevant audit work has been completed. Pursuant to the Asset Transfer Agreement and audit results, the Company should pay COSCO Company or its designated wholly-owned subsidiary, COSCO Bulk, for the loss during the transition period and other change of equities of the assets disposed. The amount of compensation is RMB339 million, which has not been paid as at the reporting date.

3.3 Performance of undertakings made by the Company and its shareholders with shareholding over 5%

I. Undertakings of controlling shareholders in relation to the independence of Company

• (1). On 11 December 2015, China Shipping, as the controlling shareholder of the Company, made the following undertakings:

China Shipping undertakes to maintain separation of the Company’s assets, personnel, finance, entities and businesses, and to comply with the relevant requirements regarding a listed company’s independence as required by the China Securities Regulatory Commission. China Shipping shall not violate the standard operation procedure of the Company by virtue of its capacity as the controlling shareholder, shall not intervene with the operating decisions of the Company, and shall not jeopardize the legitimate interests of the Company and other shareholders. China Shipping and its controlled companies undertake that they won’t illegally use the funds of the Company and its controlled entities in any way.

— 10 —

China Shipping has actively fulfilled its undertakings to maintain the independence of the Company. Since the undertakings were made, China Shipping has taken the necessary measures to comply with the relevant requirements of the China Securities Regulatory Commission on the independence of listed companies.

• (2). On 5 May 2016, China COSCO Shipping Corporation Limited (“COSCO Shipping Group”), as the indirect controlling shareholder of the Company, made the following undertakings:

• COSCO Shipping Group undertakes that following the completion of the gratuitous transfer, while COSCO Shipping Group directly or indirectly holds the controlling interest of the Company, COSCO Shipping Group shall, on its own and through COSCO Company and China Shipping, maintain separation of the Company’s assets, personnel, finance, entities and businesses, and comply with the relevant requirements regarding a listed company’s independence as required by the China Securities Regulatory Commission. COSCO Shipping Group shall not violate the standard operation procedure of the Company by virtue of its capacity as the controlling shareholder, shall not intervene with the operating decisions of the Company, and shall not jeopardize the legitimate interests of the Company and other shareholders. COSCO Shipping Group and its controlled companies undertake that they won’t illegally use the funds of the Company and its controlled entities in any way.

COSCO Shipping Group has actively fulfilled the undertakings to maintain the independence of the Company. Since it has had indirect control of the Company, COSCO Shipping Group has taken the necessary measures to comply with the relevant requirements of the China Securities Regulatory Commission on the independence of listed companies.

II. Non-competition undertakings of controlling shareholders

• (1) On 23 May 2001, China Shipping, as the controlling shareholder of the Company, made the following non-competition undertakings to the Company:

• a. not to engage in any business that competes with the business of the Company; and

• b. not to support any entities under its control to commence any business that competes with the business of the Company.

— 11 —

• (2) In order to avoid any competition between China Shipping and its controlled entities (for the purpose of the undertaking, including the wholly-owned, majority-controlled or controlled subsidiaries under China Shipping but excluding the Company and its majority-controlled subsidiaries) with the Company, on 15 June 2011, China Shipping made further non-competition undertakings below in addition to the continuous performance of those previously made:

• a. China Shipping positioned the Company as the ultimate integrated sole business platform under China Shipping to specialize in oil shipping, bulk cargo and LNG transportation.

• b. For bulk cargo carriers and oil tankers owned by China Shipping and its controlled non-listed entities, China Shipping undertook to inject such bulk cargo carrier and oil tanker assets into the Company by way of merger and acquisition and restructuring of assets, or to dispose of such assets to external parties when the appropriate opportunities arise within 5 years, thus eliminating the competition between China Shipping and the Company to promote the sustainable and stable growth of the Company.

• c. For bulk cargo carriers and oil tankers chartered by China Shipping (Hong Kong) Holdings Co., Ltd. (“China Shipping (H.K.) Holdings”), a majority-controlled subsidiary of China Shipping, by way of finance leases (the leases of such vessels expired in 2011 and 2012), China Shipping undertook to inject such bulk cargo carrier and oil tanker assets into the Company by way of merger and acquisition and restructuring of assets, or to dispose of such assets to external parties, subject to the completion of procedures for acquiring ownership of such vessels under finance leases by China Shipping (H.K.) Holdings when the appropriate opportunities arise within 5 years.

• d. Before completion of the injection of such bulk cargo carrier and oil tanker assets into the Company or otherwise disposal to external parties, China Shipping will, pursuant to the business needs of the Company, charter the above vessels to the Company (including its majority-controlled subsidiaries and/or joint venture companies) for operation based on market-oriented principles, or entrust such vessels to the Company (including its majority-controlled subsidiaries and/or joint venture companies) for operation and management, so as to avoid competition.

— 12 —

The Company implemented a material asset restructuring in the first half of 2016. The undertakings in items (2)a and (2)b above in respect of bulk assets to be injected into the Company or disposed of, and the undertaking in item (2)d above in respect of lease and entrusted management of bulk assets prior to injection or disposal thereof have been waived in the Company’s general meeting and are no longer required to be performed. Given that all the oil shipping and LNG assets of China Shipping are owned by the Company, the above undertakings have been completed.

• (3). On 11 December 2015, as the controlling shareholder of the Company, China Shipping made the following non-competition undertakings to the Company in relation to the then proposed material asset restructuring plan:

• a. Upon completion of the material asset restructuring plan, China Shipping will not directly or indirectly (including but not limited to sole proprietorship, joint venture, cooperation and joint operation, etc.) participate in or conduct any business activities that constitute or may constitute substantive competition with the principal business in which the Company is engaged.

• b. In respect of competition or potential competition that may arise in future between products produced or businesses engaged by the wholly-owned, holding and equity participation enterprises of China Shipping and the Company, if requested by the Company, China Shipping undertakes that it will assign all contribution or shares in the aforesaid enterprises and undertakes that provided that laws and regulations are complied with, it will grant the right of pre-emption to the Company or its wholly-owned subsidiaries in respect of the aforesaid contribution or shares, and will do its utmost to procure that the price of the relevant transaction is determined on the basis of fairness, reasonableness and normal commercial transactions with independent third parties.

• c. In the event that the interests of the Company and other shareholders are damaged as a result of a breach of the above undertakings by China Shipping or other enterprises controlled by China Shipping, China Shipping will assume the corresponding compensatory liability according to the law.

China Shipping has actively performed its non-competition undertakings and has taken necessary steps since the undertakings were made to eliminate and prevent competition with the Company.

— 13 —

• (4) On 5 May 2016, COSCO Shipping Group, as the indirect controlling shareholder of the Company, made the following undertakings:

• a. During the period when the Company is directly or indirectly controlled by COSCO Shipping Group, COSCO Shipping Group and its subsidiaries will not take any action or measure to engage in business activities which compete or may compete substantively with the principal business of the Company and its subsidiaries and will not infringe upon the legitimate interests of the Company and its subsidiaries, which shall include, without limitation, establishing other subsidiaries, joint ventures or associated companies in the future to engage in businesses which constitute substantive competition with the existing principal business of the Company and its subsidiaries or otherwise directly or indirectly participating in the existing principal business of the Company and its subsidiaries.

• b. If potential exists for COSCO Shipping Group and the companies controlled by it to substantively compete with the Company in terms of its principal business or have substantive conflicts of interest with the Company in the future, COSCO Shipping Group will give up or procure the companies controlled by it to give up the business opportunities that may give rise to competition or inject the businesses of COSCO Shipping Group and the companies controlled by it that may give rise to competition into the Company at an appropriate time and at equitable and fair market prices.

• c. COSCO Shipping Group will not take advantage of information obtained from or made aware of by the Company to assist any third party in engaging or participating in any business activities where substantive or potential competition with the existing business of the Company exists.

• d. In the event that the interests of the Company and other shareholders are damaged as a result of a breach of the above undertakings by COSCO Shipping Group or other companies controlled by it, COSCO Shipping Group will assume the corresponding compensatory liability according to the law.

COSCO Shipping Group has actively performed its non-competition undertakings and has taken necessary steps since it has had indirect control over the Company to eliminate and prevent competition with the Company.

— 14 —

III. REDUCTION OF CONNECTED TRANSACTIONS

• (1) On 11 December 2015, China Shipping, as the controlling shareholder of the Company, made the following undertakings:

• a. China Shipping and other enterprises controlled by it and the Company shall avoid or reduce connected transactions so far as possible. For connected transactions that are unavoidable or indeed necessary, China Shipping undertakes that it will adhere to the market-oriented principles of impartiality, fairness and openness, enter into agreements according to law, perform the legal procedure in accordance with the relevant laws and regulations, regulatory documents and relevant provisions such as the articles of association of the Company, guarantee the fairness and compliance of connected transactions, guarantee not to prejudice the legitimate interests of the Company and other shareholders, and make timely information disclosure in accordance with the relevant laws and regulations and the requirements of regulatory documents.

• b. China Shipping will exercise the rights of shareholders in strict accordance with laws and regulation such as the Company Law of the PRC and the articles of association of the Company and fulfill its obligation to abstain from voting on connected transactions of China Shipping and other enterprises controlled by it at the general meetings of the Company.

The above undertakings shall continue to be in force during the period in which China Shipping is the controlling shareholder of the Company.

China Shipping has actively performed its undertakings to reduce connected transactions and has taken necessary steps since the undertakings were made to avoid or reduce connected transactions. For those unavoidable or necessary connected transactions, it shall ensure that they are fair and carried out in compliance with the law.

• (2). On 5 May 2016, COSCO Shipping Group, as the indirect controlling shareholder of the Company, made the following undertakings:

• a. COSCO Shipping Group and other companies controlled by it shall avoid unnecessary connected transactions with to the Company as much as possible. In respect of those connected transactions necessary for the continuing operation of the Company, they shall be conducted in a manner agreed by both parties, in accordance with market-based pricing principles and in compliance with the relevant laws, regulations and governing documents, as well as the Company’s articles of associations and policies in place regarding connected transactions.

— 15 —

• b. COSCO Shipping Group and other companies controlled by it shall avoid or reduce connected transactions with the Company as much as possible in the future. For those connected transactions that are unavoidable or that arise out of reasonable cause, COSCO Shipping Group undertakes to enter into agreements in respect of those connected transactions with the Company in accordance with the relevant laws, regulations and governing documents, as well as the Company’s articles of associations and policies in place regarding connected transactions, to adhere to general market-oriented principles of impartiality, fairness and openness, to ensure that all connected transactions are fair and conducted in compliance with laws, and to carry out transaction procedures and make timely information disclosure in accordance with the relevant laws and regulations and the requirements of regulatory documents.

• c. The undertakings from COSCO Shipping Group on regulating connected transactions will also apply to other companies controlled by COSCO Shipping Group. COSCO Shipping Group will, to the extent permitted by laws, procure other companies controlled by it to perform their obligations on regulating those connected transactions that have been or may be conducted with the Company.

COSCO Shipping Group has actively performed its undertakings to limit connected transactions and has taken necessary steps since it has had indirect control over the Company with to avoid or reduce connected transactions. For those unavoidable or necessary connected transactions, it shall ensure that they are fair and carried out in compliance with laws.

— 16 —

IV. UNDERTAKINGS ON USE OF CAPITAL

To protect the interests of the Company’s minority shareholders, China Shipping as the controlling shareholder of the Company and COSCO Company as the counterparty in the Company’s material asset restructuring, jointly made the following undertakings on 29 March 2016 in relation to the debts arising from the borrowings and payables between CS Bulk and its subsidiaries and the Company and its subsidiaries:

• a. The debts of CS Bulk and its subsidiaries arising from the borrowings and payables owing to the Company and its subsidiaries (except for debts arising from CS Bulk’s internal consolidation of bulk carriers) shall be settled in full by China Shipping and/or its designated connected parties on or before the completion date of the material asset restructuring of the Company;

• b. COSCO Company agrees to bear joint and several liability for the settlement of the aforesaid debts to ensure that no non-operating capital of the Company and its subsidiaries will be used by CS Bulk and its subsidiaries following completion;

• c. China Shipping agrees to provide necessary financial assistance to CS Bulk and its subsidiaries for their capital requirements in their daily operation from the date of the relevant letter of undertaking.

After the completion of material asset restructuring, CS Bulk has already repaid the borrowings and payables owing to the Company. China Shipping and COSCO Company have proactively performed its undertakings to ensure that no non-operating capital of the Company and its subsidiaries will be used by CS Bulk and its subsidiaries.

V. PROFIT FORECAST AND COMPENSATION UNDERTAKINGS

• (1). Profit forecast and compensation commitment given by Shanghai Shipping (Group) Company, a wholly-owned subsidiary of China Shipping, in a share transfer.

COSCO SHIPPING Tanker (Shanghai) Co., Ltd. (上海中遠海運油品運輸有 限公司, “Shanghai Tanker”), a wholly-owned subsidiary of the Company, acquired 20% equity interest in Shanghai Beihai Shipping Company Limited (上海北海船務股份有限公司, “Beihai Shipping”) from Shanghai Shipping (Group) Company (上海海運（集團）公司, “Shanghai Shipping”) for RMB830 million on 30 July 2014. Shanghai Shipping issued a “Letter of Compensation Undertakings” on 20 August 2014, pursuant to which

— 17 —

Shanghai Shipping undertook that after completion of the transaction, when the Company published its annual reports for the years 2014, 2015 and 2016, if the audited net profit attributable to shareholders of the parent company of Beihai Shipping in any year for the three years from 2014 to 2016 was unable to meet the profit forecast amount contained in the profit forecast audit report or the net profit amount forecast in the valuation report, whichever the higher (which were RMB370,311,100, RMB380,448,400 and RMB431,627,600 respectively), Shanghai Shipping will make a cash payment equivalent to 20% of the shortfall in net profit to Shanghai Tanker within 10 working days after publication of the Company’s annual report for that year.

The net profit realized by Beihai Shipping in 2014 was RMB425,433,800, which was higher than the profit forecast amount.

The net profit realized by Beihai Shipping in 2015 was RMB486,968,100, which was higher than the profit forecast amount.

• (2). On 29 March 2016, COSCO Company made the following undertaking:

COSCO Company has undertaken that the consolidated audited net profit of COSCO SHIPPING Tanker (Dalian) Co., Ltd. (大連中遠海運油品運輸有限 公司, “Dalian Tanker”), attributable to shareholders of the parent for the three years from 2016 to 2018 shall be not less than RMB819 million. COSCO Company, as the party responsible for compensation, shall assume the compensation responsibility in respect of the difference between the actual net profit and the forecast net profit of Dalian Tanker.

— 18 —

4 Appendix

4.1 Consolidated Balance Sheet

					30 September 2016	31 December 2015
	Items				RMB	RMB
	Current assets
	Cash and Cash Equivalents				9,615,319,644.47	4,908,977,899.22
	Notes receivable				67,288,499.38	470,289,495.61
	Accounts receivable				1,253,234,183.44	2,321,006,698.63
	Funds paid in advance				621,797,818.51	508,215,200.88
	Interest receivable				3,572,671.63	—
	Dividends receivable				1,225,556.33	292,548,430.38
	Other receivables				186,374,157.22	315,108,013.83
	Inventory				353,395,352.70	715,085,657.98
	Other current assets				2,576,450.16	767,651,334.99
	Total Current Assets				12,101,211,662.21	10,302,455,403.15
	Non-current liabilities
	Financial assets	available for sale			158,932,089.70	163,187,161.24
	Long-term receivables				1,257,340,850.06	2,119,286,105.71
	Long-term equity investment				3,925,913,899.50	8,228,262,098.02
	Investment properties				1,088,658,594.01	1,097,974,934.00
	Fixed assets				29,233,984,249.52	55,494,366,003.87
	Construction in progress				9,839,031,455.23	7,607,086,481.16
	Intangible assets				89,257,713.58	108,810,037.48
	Long-term deferred expenses				1,958,742.99	8,700,496.93
	Deferred income tax asset				4,225,733.80	486,992,823.47
	Total non-current assets				45,599,303,328.39	75,314,666,141.88
	Total asset				57,700,514,990.60	85,617,121,545.03

— 19 —

					30 September 2016	31 December 2015
	Items				RMB	RMB
	Current liabilities
		Short-term borrowings			2,663,512,201.85	5,789,593,406.22
		Derivative financial liabilities			4,258,703.02	—
		Accounts payable			1,173,636,526.97	1,477,972,072.11
		Receipts in advance			303,517,029.90	530,834,690.42
		Salaries and wages payable			98,052,137.11	115,973,994.78
		Taxes payable			87,855,005.67	182,069,631.25
		Interests payable			349,606,251.14	269,096,967.77
		Dividends payable			241,979.02	241,979.02
		Other payables			444,809,054.33	214,618,370.88
		Non-current liabilities due within one year			5,639,452,207.67	5,322,985,189.85
		Total current liabilities			10,760,682,393.66	13,907,645,005.32
	Non-current liabilities
		Long-term borrowings			13,793,455,885.76	32,411,922,195.71
		Bonds payable			3,981,126,451.94	3,978,488,211.00
		Long-term payables			881,007,885.45	1,553,542,641.99
		Long-term salaries and	wages payable		119,200,000.00	160,805,299.16
		Estimated liabilities			370,709,754.34	340,446,691.29
		Deferred income			47,298.51	87,298.51
		Deferred income tax liabilities			169,273,458.39	245,386,006.25
		Other non-current liabilities			826,708,111.55	411,385,025.09
		Total non-current liabilities			20,141,528,845.94	39,102,063,369.00
		Total liabilities			30,902,211,239.60	53,009,708,374.32
	Shareholders’ equity
		Share capital			4,032,032,861.00	4,032,032,861.00
		Capital reserve			7,597,367,292.44	14,226,642,078.95
		Other comprehensive income			-176,641,320.51	-489,808,810.51
		Specific reserve			57,401,421.82	82,625,287.88
		Surplus reserve			2,877,436,346.44	2,877,436,346.44
		Undistributed profit			12,836,476,549.31	11,015,611,913.72
		Total equity attributable to owners of the parent company			27,224,073,150.50	31,744,539,677.48
		Minority interests			-425,769,399.50	862,873,493.23
		Total shareholders’ equity			26,798,303,751.00	32,607,413,170.71
		Total liabilities and shareholders’ equity			57,700,514,990.60	85,617,121,545.03

— 20 —

Balance Sheet of Parent Company

				30 September 2016	30 September 2016	31 December 2015
	Items				RMB	RMB
	Current assets
	Cash and cash equivalents				3,460,377,361.53	375,220,780.02
	Interests receivable				115,294,748.86	88,067,339.12
	Dividends receivable					275,000,000.00
	Other receivables				1,674,335,293.01	10,093,145,327.93
	Other current assets					12,801,345.16
	Total Current Assets				5,250,007,403.40	10,844,234,792.23
	Non-current assets
	Financial assets available for sale				29,454,546.00	29,454,546.00
	Held-to-maturity investments				7,000,000,000.00	10,064,936,000.00
	Long-term equity investment				16,312,136,438.20	17,017,161,932.37
	Investment properties				1,226,464,131.00	1,226,464,131.00
	Fixed assets				64,479,693.80	65,441,435.65
	Intangible assets				3,179,244.24	5,090,947.08
	Total non-current assets				24,635,714,053.24	28,408,548,992.10
	Total assets				29,885,721,456.64	39,252,783,784.33
	Current liabilities
	Short-term borrowings				—	824,680,000.00
	Salaries and wages payable				3,084,403.43	1,318,878.09
	Taxes payable				-15,207,773.88	9,244,707.98
	Interests payable				128,306,300.62	131,409,729.47
	Other payables				2,064,027,331.73	2,078,702,087.16
	Total current liabilities				2,180,210,261.90	3,045,355,402.70
	Non-current liabilities
	Long-term borrowings					5,800,000,000.00
	Bonds payable				3,981,126,451.94	3,978,488,211.00
	Deferred income tax liabilities				169,250,983.65	169,250,983.65
	Total non-current liabilities				4,150,377,435.59	9,947,739,194.65
	Total liabilities				6,330,587,697.49	12,993,094,597.35
	Shareholders’ equity
	Share capital				4,032,032,861.00	4,032,032,861.00
	Capital reserve				7,845,997,235.61	7,765,430,636.94
	Other comprehensive income				274,283,785.31	274,283,785.31
	Surplus reserve				2,877,436,346.44	2,877,436,346.44
	Undistributed profit				8,525,383,530.79	11,310,505,557.29
	Total shareholders’ equity				23,555,133,759.15	26,259,689,186.98
	Total liabilities and shareholders’ equity				29,885,721,456.64	39,252,783,784.33

— 21 —

4.2 Consolidated Income Statement

				July-	July-	January-	January-	January-
				September 2016	September 2015	September 2016	September 2015
		Items		RMB	RMB	RMB	RMB
		**1. Gross revenue **	from operations	2,169,162,275.86	4,735,086,038.51	10,715,772,117.93	12,986,880,069.64
		Including: revenue from operation		2,169,162,275.86	4,735,086,038.51	10,715,772,117.93	12,986,880,069.64
		2. Gross cost from operations		2,004,551,218.08	4,389,133,591.19	9,638,277,299.88	11,986,234,113.80
		Including: cost from operation		1,660,110,715.69	3,698,756,666.90	8,147,508,362.61	10,360,984,025.00
		Business taxes and other surcharges		4,053,474.43	10,237,692.81	18,019,384.48	22,240,559.31
		Sales expenses		4,416,836.39	31,085,367.04	55,079,065.80	62,461,177.89
		Administrative expenses		122,092,234.33	176,548,971.47	488,214,884.71	434,682,742.10
		Financial expenses		213,973,547.71	472,504,892.97	929,491,362.37	1,105,865,609.50
		Loss on impairment of assets		-95,590.47	—	-35,760.09	—
		Add: Gain from changes in fair
		value (Loss stated with “-”)		6,691,634.31	3,210,221.16	3,750,354.72	6,718,000.00
		Investment income (Loss stated
		with“-”)		144,198,815.53	133,283,677.47	1,286,723,070.51	257,480,123.11
		Including: investment income from
		associates and joint ventures		109,373,319.16	118,650,412.13	284,364,023.64	245,597,911.86
		3. Operating profit		315,501,507.62	482,446,345.95	2,367,968,243.28	1,264,844,078.95
		Add: Non-operating revenue		212,824,558.05	96,745,467.98	233,335,852.39	1,255,731,389.22
		Less: Non-operating expenditure		86,215,355.92	31,186,136.14	215,714,755.33	1,206,665,158.82
		Including: Loss arising from
		disposal of non-current assets		286,499.53	6,995,512.61	3,112,282.30	1,184,116,643.23
		4. Gross profit		442,110,709.75	548,005,677.79	2,385,589,340.34	1,313,910,309.35
		Less: Income tax		37,073,506.18	56,646,916.82	137,540,177.92	-48,311,505.64
		5. Net profit		405,037,203.57	491,358,760.97	2,248,049,162.42	1,362,221,814.99
		Net profit attributable to owners of
		parent company		403,717,382.08	490,414,793.43	2,224,067,921.69	1,328,466,704.77
		Net profit attributable to minority
		shareholders		1,319,821.49	943,967.54	23,981,240.73	33,755,110.22
		6. Other comprehensive net
		income after tax		-71,393,998.16	123,484,002.19	-288,871,953.57	116,269,584.33
		Other comprehensive net income
		after tax attributable to owners
		of parent company		-53,581,150.81	143,046,558.90	-48,864,227.04	118,112,064.40
		(1) Other comprehensive income
		that may not be subsequently
		reclassified into profit or loss		—	—	530,000.00	—

— 22 —

				July-	July-		July-	January-		January-
				**September **	2016	September 2015		September 2016	September 2015
		Items		RMB			RMB	RMB		RMB
		Including:	1. Changes in net
		liabilities or net assets arising
		from the re-measurement of
		defined	benefit plans		—		—	530,000.00		—
		(2) Other comprehensive income to
		be re-classified to profit or		loss -53,581,150.81		143,046,558.90		-49,394,227.04	118,112,064.40
		Including:	1. Share of other
		comprehensive income to be
		re-classified to profit or loss		in
		an investee in accordance with
		equity method		7,667,195.09		-9,622,526.89		13,500,715.63		-3,748,870.57
		2. Effective parts of profit or loss
		on cash	flow hedges	-13,133,389.52		-35,426,895.95		-162,257,873.45	-25,464,037.87
		3. The difference between the
		translation of foreign currency
		financial statements		-48,114,956.38		188,095,981.74		99,362,930.78	147,324,972.84
		Other comprehensive net income
		after tax attributable to
		minority shareholders		-17,812,847.35		-19,562,556.71		-240,007,726.53		-1,842,480.07
		7. Total comprehensive income 333,643,205.41				614,842,763.16		1,959,177,208.85	1,478,491,399.32
		Total comprehensive income
		attributable to owners of parent
		company		350,136,231.27		633,461,352.33		2,175,203,694.65	1,446,578,769.17
		Total comprehensive income
		attributable to minority
		shareholders		-16,493,025.86		-18,618,589.17		-216,026,485.80		31,912,630.15
		8. Earnings per share
		(1) Basic		0.1001			0.1160	0.5516		0.3354
		(2) Diluted		0.1001			0.1160	0.5516		0.3354

The Company acquired a subsidiary in the combination of business under common control this year. Net profit of such subsidiary prior to the combination was RMB628,586,112.22. Net profit of such subsidiary during January - September 2015 was RMB637,845,000.

— 23 —

Income Statement of Parent Company

					July-		July-	January-		January-
				September 2016		September 2015		September 2016	September 2015
		Items			RMB		RMB	RMB		RMB
		1. Revenue from operations		8,701,410.22		17,551,430.37		22,496,331.65	51,485,005.02
		Less: cost from operation			—	21,181,697.76		—	70,363,889.63
		Business	taxes and other surcharges 35,315.96			387,741.03		4,622,885.75		2,787,448.85
		Sales expenses		3,527,439.57			—	4,640,548.86		—
		Administrative expenses		-4,736,983.65		9,483,698.85		80,785,860.00	21,949,207.63
		Financial expenses		72,170,062.15		152,929,052.36		306,915,329.34	373,610,623.82
		Add: Gain from changes in fair
		value (Loss stated with “-”) -1,062,307.00					—	—		—
		Investment income (Loss stated
		with“-”)		101,411,079.53		165,505,518.62		-1,982,099,687.16	374,702,665.82
		Including: investment income		from
		associates and joint ventures 11,150,368.89				41,956,659.72		29,366,951.77		7,798,282.37
		2. Operating profit		38,054,348.72		-925,241.01		-2,356,567,979.46	-42,523,499.09
		Add: Non-operating revenue			—	19,567,675.00		79,900.82	245,676,876.19
		Less: Non-operating expenditure 1,504.00				-36,822,264.62		11,685.87		760,065.32
		Including: Loss arising from
		disposal of non-current assets			—		438.83	2,926.87		950.23
		**3. Gross **	profit	38,052,844.72		55,464,698.61		-2,356,499,764.51	202,393,311.78
		Less: Income tax		-2,218,478.61		-1,918,512.25		25,418,975.89		—
		4. Net profit		40,271,323.33		57,383,210.86		-2,381,918,740.40	202,393,311.78
		5. Net other comprehensive income
		after tax		3,182,581.68		-2,999,891.39		—		—
		Other comprehensive income to be
		re-classified to profit or loss 3,182,581.68				-2,999,891.39		—
		Including: Share of other
		comprehensive income to be
		re-classified to profit or loss in
		an investee in accordance with
		equity	method	3,182,581.68		-2,999,891.39		—		—
		6. Total comprehensive income 43,453,905.01				54,383,319.47		-2,381,918,740.40	202,393,311.78
		7. Earnings per share
		(1) Basic		0.0100			0.0142	-0.5907		0.0565
		(2) Diluted		0.0100			0.0142	-0.5907		0.0565

— 24 —

4.3 Consolidated Cash Flow Statement

				January -	January -
				September 2016	September 2015
	Items			RMB	RMB
	1. Cash flows from operating activities
	Cash received from sales of goods and provision of services			10,723,188,890.65	12,266,085,401.24
	Cash received from return of taxes and fees			197,097,248.65	248,050,470.42
	Cash received from other related operating activities			13,053,403,209.32	1,430,224,834.45
	Subtotal of cash inflow from operating activities			23,973,689,348.62	13,944,360,706.11
	Cash paid for goods and services			5,670,292,030.38	6,100,477,658.96
	Cash paid to or on	behalf of employees		1,410,975,926.77	1,461,593,897.75
	Taxes paid			484,932,603.20	264,561,776.20
	Other cash paid relating to operating activities			1,503,492,988.01	712,265,140.95
	Subtotal of cash outflow from operating activities			9,069,693,548.36	8,538,898,473.86
	Net cash flows from operating activities			14,903,995,800.26	5,405,462,232.25
	2. Cash flows from investing activities
	Cash received from withdrawal of investment			5,754,973,897.21	204,787,000.00
	Cash inflow from return on investment			1,005,271,388.45	154,503,754.22
	Net cash inflow from disposal of fixed, intangible and other long-term
	assets			24,263.16	464,013,060.08
	Net cash received from disposal of subsidiaries and other business units			8,250,431,088.09	—
	Other cash received relating to investing activities			—	611,900,000.00
	Subtotal of cash inflow from investing activities			15,010,700,636.91	1,435,203,814.30
	Cash paid for purchase of fixed, intangible and other long-term assets			1,683,148,825.42	3,822,623,470.83
	Cash paid for investment			7,042,419,259.42	1,491,362,058.45
	Other cash paid relating to investing activities			1,203,842,119.76	19,000.00
	Subtotal of cash outflow from investing activities			9,929,410,204.60	5,314,004,529.28
	Net cash flows from investing activities			5,081,290,432.31	-3,878,800,714.98
	3. Cash flows from financing activities
	Cash received from investments			449,097.74	24,390,000.00
	Cash received from borrowings			2,764,451,522.47	11,891,454,454.91
	Cash received from other financing activities			19,981,324.92	110,941,000.00
	Sub-total of cash inflows of financing activities			2,784,881,945.13	12,026,785,454.91
	Cash paid for payment of debts			16,684,495,781.68	12,518,772,083.99
	Cash paid for distribution of dividends or		profits and for interest expenses	1,390,625,104.97	1,270,561,514.90
	Including:Dividends and profit distributed		to minority shareholders by
	subsidiaries			11,850,000.00	—
	Other cash paid relating to financing activities			100,835,760.16	180,170,261.72
	Subtotal of cash outflow from financing activities			18,175,956,646.81	13,969,503,860.61
	Net cash flows from financing activities			-15,391,074,701.68	-1,942,718,405.70
	4. Effect on cash and cash equivalents from change of exchange rates			112,302,782.86	110,554,213.35
	**5. Net increase in **	cash and cash equivalents		4,706,514,313.75	-305,502,675.08
	Add: Balance of cash and cash equivalents at the beginning of the
	Reporting Period			4,863,246,614.72	5,058,991,277.90
	**6. Balance of cash **	**and cash equivalents **	at the end of the Reporting
	Period			9,569,760,928.47	4,753,488,602.82

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Cash Flow Statement of Parent Company

					January -	January -
					September 2016	September 2015
	Items				RMB	RMB
	1. Cash flows from operating activities
	Cash received from sales of goods and provision of services				22,496,331.65	591,894.41
	Cash received from return of taxes and fees				39,900.82	59,201.19
	Cash received from other related operating activities				6,546,474,637.60	4,011,536,578.11
	Subtotal of cash inflow from operating activities				6,569,010,870.07	4,012,187,673.71
	Cash paid for goods and services				770,371.58	8,161,810.70
	Cash paid to or on behalf of employees				23,102,521.15	10,438,662.27
	Taxes paid				37,001,537.99	7,134,702.49
	Other cash paid relating to operating activities				181,677,048.68	1,486,666,589.63
	Subtotal of cash outflow from operating activities				242,551,479.40	1,512,401,765.09
	Net cash flows from operating activities				6,326,459,390.67	2,499,785,908.62
	2. Cash flows from investing activities
	Cash received from withdrawal of investment				4,066,312,000.00	1,000,000,000.00
	Cash inflow from	return on investment			710,878,028.78	425,341,266.29
	Net cash received	from disposal of subsidiaries and other business units			5,332,385,800.00	—
	Subtotal of cash inflow from investing activities				10,109,575,828.78	1,425,341,266.29
	Cash paid for investment				7,629,408,800.00	2,827,547,078.77
	Subtotal of cash outflow from investing activities				7,629,408,800.00	2,827,547,078.77
	Net cash flows from investing activities				2,480,167,028.78	-1,402,205,812.48
	3. Cash flows from financing activities
	Cash received from borrowings				—	1,907,827,333.33
	Other cash received relating to financing activities				1,143,854,000.00	851,123,627.09
	Sub-total of cash inflows of financing activities				1,143,854,000.00	2,758,950,960.42
	Cash paid for payment of debts				6,122,945,000.00	3,146,675,437.82
	Cash paid for distribution of dividends or profits and for interest
	expenses				740,344,077.20	567,202,958.73
	Other cash paid relating to financing activities					892,958,196.92
	Subtotal of cash outflow from financing activities				6,863,289,077.20	4,606,836,593.47
	Net cash flows from financing activities				-5,719,435,077.20	-1,847,885,633.05
	**4. Effect on cash **	and cash equivalents from change of exchange
	rates				-2,034,760.74	67,808.64
	5. Net increase in cash and cash equivalents				3,085,156,581.51	-750,237,728.27
	Add: Balance of cash and cash equivalents at the beginning of the
	Reporting Period				375,220,780.02	1,129,655,058.98
	**6. Balance of cash and cash equivalents at **			the end of the Reporting
	Period				3,460,377,361.53	379,417,330.71

— 26 —

This announcement is made in compliance with Rule 13.10B of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. The Company’s A Shares are listed on the Shanghai Stock Exchange, and the Shanghai Stock Exchange has required the Company to make an announcement similar to this announcement in Shanghai.

By order of the Board COSCO SHIPPING Energy Transportation Co., Ltd. Yao Qiaohong Company Secretary

Shanghai, the PRC 28 October 2016

As at the date of this announcement, the Board of Directors of the Company comprises Mr. Sun Jiakang, Mr. Liu Hanbo and Mr. Lu Junshan as executive Directors, Mr. Feng Boming, Mr. Zhang Wei and Ms. Lin Honghua as non-executive Directors, Mr. Wang Wusheng, Mr. Ruan Yongping, Mr. Ip Sing Chi, Mr. Rui Meng and Mr. Teo Siong Seng as independent non-executive Directors.

— 27 —