Dida Inc. — Interim / Quarterly Report 2016

Apr 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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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)

First Quarterly Report of 2016

Summary

This Report for the three months ended 31 March 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 first quarterly report (the “ Report ”) for the three months ended 31 March 2016 (the “ Reporting Period ”) of China Shipping Development Company Limited (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	As at	Increase/
			31 March 2016		31 December 2015	Decrease (%)
	Total assets (RMB)		68,208,468,760.02		68,378,653,294.64	-0.25
	Net assets attributable to
	shareholders of the
	Company (RMB)		25,697,893,398.02		25,697,205,499.22	0.00
			For the three		For the three
			months ended		months ended	Increase/
			31 March 2016		31 March 2015	Decrease (%)
	Net cash flow from operating
	activities (RMB)		1,030,537,001.04		828,776,977.48	24.34
			For the three		For the three
			months ended		months ended	Increase/
			31 March 2016		31 March 2015	Decrease (%)
	Revenue	from operation
	(RMB)		3,036,681,555.90		2,921,154,760.26	3.95
	Net profit attributable to
	shareholders of the
	Company (RMB)		154,679,652.49		65,946,282.59	134.55
	Net profit attributable to
	shareholders of the
	Company after exceptional
	items	(RMB)	149,186,452.00		40,078,744.68	272.23
	Rate of returns on net assets					Increase by 0.32
	(%) (weighted)			0.60	0.28	percentage points
	Basic earnings per share
	(RMB)			0.0384	0.0180	113.33
	Diluted earnings per share
	(RMB)			0.0384	0.0164	134.15

— 2 —

		For the three months	For the three months	For the three months
Exceptional items and amount		ended 31 March 2016
Items			Amount (RMB)
Profit and Loss on disposal of non-current assets			-2,926.87
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 certain standards and adhering to		certain principles
under national policies			189,119.86
Other profits or losses within the definition of extraordinary profit or
loss			7,157,504.11
Minority interests effect (after tax)			-14,572.33
Income tax effect			-1,835,924.28
Total			5,493,200.49

— 3 —

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

			Total number of shareholders	Total number of shareholders									145,223	145,223
							Top 10 shareholders
									Number of
									shares with	Number of shares
			Name of shareholders (Full			Number of	Shareholding		selling	subject to pledge		Type of
			Name)			shares	(%)		restrictions		or lock up	shareholders
			China Shipping (Group)		1,536,924,595		38.12		0		Nil	Stated-owned
			Company(1) (中國海運(集團)總									entity
			公司)
			HKSCC NOMINEES	LIMITED(2)	1,286,990,896		31.92		0		Unknown	Offshore	entity
			Central Huijin Assets	Management		92,709,700	2.30		0		Nil	Stated-owned
			Company Ltd (中央匯金資產管									entity
			理有限責任公司)
			National Social Security Fund			31,280,264	0.78		0		Nil	Others
			Portfolio 412 (全國社保基金四
			零七組合)
			China Securities Finance Co., Ltd.			27,849,503	0.69		0		Nil	Stated-owned
			(中國證券金融股份有限公司)									entity
			Harvest Fund - Agricultural Bank			24,879,500	0.62		0		Nil	Others
			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)
			Zhongou Fund - Agricultural Bank			24,879,500	0.62		0		Nil	Others
			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)
			GF Fund - Agricultural Bank of			24,879,500	0.62		0		Nil	Others
			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)
			Agricultural Bank of	China		15,777,665	0.39		0		Nil	Others
			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)
			Southern Fund - Agricultural			12,596,453	0.31		0		Nil	Others
			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)
							— 4 —

	Top ten holders of shares in circulation without any selling restrictions(3)	Top ten holders of shares in circulation without any selling restrictions(3)	Top ten holders of shares in circulation without any selling restrictions(3)	Top ten holders of shares in circulation without any selling restrictions(3)	Top ten holders of shares in circulation without any selling restrictions(3)
			**Number of shares **	in
			circulation without
			any selling
			restrictions as at the
	Name of Shareholders (full end of the reporting
	name)		period		Type of shares
	China Shipping (Group)		1,536,924,595		RMB ordinary shares
	Company(1)
	HKSCC NOMINEES LIMITED(2) 1,286,990,896				Offshore listed H
					shares
	Central Huijin Assets Management 92,709,700				RMB ordinary shares
	Company Ltd
	National Social Security Fund 31,280,264				RMB ordinary shares
	Portfolio 412
	China Securities Finance Co., Ltd. 27,849,503				RMB ordinary shares
	Harvest Fund - Agricultural Bank 24,879,500				RMB ordinary shares
	of	China - Harvest CSI	Financial
	Asset Management Plan
	Zhongou Fund - Agricultural Bank 24,879,500				RMB ordinary shares
	of	China - Zhongou CSI
	Financial Asset Management Plan
	GF Fund - Agricultural Bank of 24,879,500				RMB ordinary shares
	China - GF CSI Financial Asset
	Management Plan
	Agricultural Bank of China 15,777,665				RMB ordinary shares
	Company Limited - Wells Fargo
	CSI State-owned Enterprises
	Reform Index Classification
	Securities Investment Fund
	Southern Fund - Agricultural Bank 12,596,453				RMB ordinary shares
	of	China - Southern CSI
	Financial Asset Management Plan

— 5 —

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.

— 6 —

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
	Balance Sheet Item			2016.03.31 2015.12.31				Change(%)		Significant Changes
	Cash		3,341,519,347.08 2,085,888,552.68						60.20	Notes (1)
	Prepayments			617,726,589.88 362,656,212.35					70.33	Notes（2）
	Dividends			16,322,874.05 291,322,874.05					-94.40	Notes（3）
	receivables
	Other receivables			146,883,096.22 214,246,724.20					-31.44	Notes（4）
	Long-term accounts			967,971,170.11 2,119,286,105.71					-54.33	Notes（5）
	receivables
	Taxes payable			105,395,163.25 163,184,585.04					-35.41	Notes（6）
	Interests payable			429,847,711.19 245,843,657.37					74.85	Notes（7）
	Other payables			199,362,912.43 143,075,495.36					39.34	Notes（8）
	Non-current			17,000,000.00 2,863,529,983.38					-99.41	Notes（9）
	liabilities to be
	mature in less
	than one year
	Other non-current			660,504,207.42 411,385,025.09					60.56	Notes (10)
	liabilities

Notes:

• (1) Cash increased by 60.20% as compared to the beginning of the period, which was primarily attributed to a net operating cash inflow and cash received from investments;

• (2) Prepayments increased by 70.33% as compared to the beginning of the period, which was primarily attributed to an increase in prepaid crew expenses and port charges;

• (3) Dividends receivables decreased by 94.40% as compared to the beginning of the period, which was primarily attributed to dividends amounting to RMB275 million received from Times Shipping;

• (4) Other receivables decreased by 31.44% as compared to the beginning of the period, which was primarily attributed to operating open credit received;

• (5) Long-term accounts receivables decreased by 54.33% as compared to the beginning of the period, which was primarily attributed to shareholder loans received from China Ore Shipping Pte. Ltd.;

— 7 —

• (6) Taxes payable decreased by 35.41% as compared to the beginning of the period, which was primarily attributed to the payment of taxes such as corporate income tax;

• (7) Interests payable increased by 74.85% as compared to the beginning of the period, which was primarily attributed to interests of corporate bonds not yet due for payment;

• (8) Other payables increased by 39.34% as compared to the beginning of the period, which was primarily attributed to an increase in temporary receipts.

• (9) Non-current liabilities to be mature in less than one year decreased by 99.41% as compared to the beginning of the period, which was primarily attributed to the repayment of long-term balance to be mature in less than one year;

• (10) Other non-current liabilities increased by 60.56% as compared to the beginning of the period, which was primarily attributed to losses on interest rate swap contracts.

	Income	Income		January to	January to	January to	January to	January to		Reason for	Reason for
	Statement Items			March 2016		March 2015			Change (%)	Significant Changes
	Marketing expenses			23,130,122.37		14,667,689.66			57.69	Note（1）
	Investment gains			28,176,587.53		2,920,045.40			864.94	Note（2）
	Non-operating			16,275,934.50		36,431,703.73			-55.32	Note（3）
		income
	Non-operating			1,265,271.50		1,939,466.47			-34.76	Note（4）
		expenses
	Income tax			71,655,524.31		49,667,265.23			44.27	Note（5）
		expenses

Notes:

• (1) Marketing expenses increased by 57.69% as compared to the same period last year, which was primarily attributed to the new dry bulk cargo trading business of China Shipping Bulk Carrier Co., Limited.

• (2) Investment gains increased by 864.94% as compared to the same period last year, which was primarily attributed to an improvement in the overall results of associates and joint ventures as compared to the same period last year;

• (3) Non-operating income decreased by 55.32% as compared to the same period last year, which was primarily attributed to a smaller amount of government grants;

• (4) Non-operatingexpenses decreased by 34.76% as compared to the same period last year, which was primarily attributed to reduced losses on the disposal of non-current assets;

• (5) Income tax expenses increased by 44.27% as compared to the same period last year, which was primarily attributed to an improvement in the results of the Group as compared to the same period last year;

— 8 —

	Cash Flow	January toMarch	January toMarch	January toMarch	January toMarch	January toMarch	January toMarch	January toMarch		Reason for	Reason for	Reason for
	Statement Items		2016			2015			Change(%)	Significant Changes
	Net cash flow from		1,030,537,001.04			828,776,977.48			24.34	Note（1）
	Operating
	activities
	Net cash flow from		1,033,383,743.58			-708,044,322.37			245.95	Note（2）
	Investing
	activities
	Net cash flow from		-789,577,632.98			-619,223,369.91			-27.51	Note (3)
	Financing
	activities

Notes:

• (1) Net cash flow fromoperating activities increased by 24.34% as compared to the same period last year, which was primarily attributed to an increase in cash from operating activities.

• (2) Net cash flow frominvesting activities increased by 245.95% as compared to the same period last year, which was primarily attributed to the recovery of loans from associates and a decrease in expenses for purchasing and building vessels.

• (3) Net cash flow from financing activities decreased by 27.51% as compared to the same period last year, which was primarily attributed to the repayment of loans for the period.

— 9 —

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

The Company held its 12th Board meeting of 2015 on 11 December 2015, in which the Board has approved the motion about the material asset restructuring plan of the Company. The Company has also held its 3rd Board meeting of 2016 on 29 March 2016, in which the Board approved the motion about the material asset restructuring plan and the connected transactions. The proposed material assets restructuring plan of the Company includes:

• (1) major transaction: The Company agreed to dispose 100% equity interests in China Shipping Bulk Carrier Co., Limited (“ CS Bulk ”) to China Ocean Shipping (Group) Limited (“ COSCO Company ”, together with its subsidiaries “ COSCO Group ”) (by itself or through China COSCO Bulk Shipping (Group) Co., Ltd (“ COSCO Bulk ”)), and

• (2) very substantial acquisition: The Company has agreed to acquire 100% equity interests in Dalian Ocean Shipping Company Limited (“ Dalian Ocean ”) from COSCO Company.

For detail of the plan, please refer to the announcements of the Company dated 11 December 2015 and 29 March 2016, the notice to annual general meeting dated 1 April 2016 and the circular dated 22 April 2016. The plan has been proposed to the Company’s annual general meeting to be hold on 20 May, 2016.

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

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

On 11 December 2015, China Shipping (Group) Company (“ China Shipping ”), as the controlling shareholder of the Company, hereby 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 the listed company’s independence as required by the China Securities Regulatory Commission. China Shipping shall not violate the standard operation procedure of listed company by virtue of the capacity as the controlling shareholder, shall not intervene the operating decisions of the Company, and shall not jeopardize the legitimate interests of the Company and

— 10 —

other shareholders. China Shipping and its controlling companies undertake that they won’t illegally use the funds of the Company and its controlled entities in any way.

• II. Undertakings of controlling shareholders in relation to the Prevention of Peer Competition

• (1) On 23 May 2001, China Shipping, 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 Company; and

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

• (2) In order to avoid any peer 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 peer 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

— 11 —

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 peer competition.

• (3) The Company held its 12[th] Board meeting of 2015 on 11 December 2015, in which the Board has approved the motion about the material asset restructuring plan of the Company. The Company has also held its 3[rd] Board meeting of 2016 on 29 March 2016, in which the Board approved the motion about the material asset restructuring plan and the connected transactions. The proposed material assets restructuring plan of the Company includes:

• a. major transaction: The Company agreed to dispose 100% equity interests in CS Bulk to COSCO Company (by itself or through COSCO Bulk), and

• b. very substantial acquisition: The Company has agreed to acquire 100% equity interests in Dalian Ocean Shipping Company Limited from COSCO Company.

As the controlling shareholder of the Company, China Shipping made the following non-competition undertakings to the Company in relation to the proposed material asset restructuring plan:

• a. Upon completion of the proposed material asset restructuring plan, China Shipping will not directly or indirectly (including but not limited to sole proprietorship, joint venture, cooperation and joint operation,

— 12 —

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 undertaking by China Shipping or other enterprises controlled by China Shipping, China Shipping will bear the corresponding compensation responsibility according to law.

• d. For the Item (2) of the above Non-competition Undertaking issued by China Shipping on 15 June 2011 (“ Original Undertaking ”), after the implemention of the proposed material assets restructuring plan, the Company is no longer engaged in bulk shipping business and there is uncertainty as to whether the proposed material assets restructuring plan can be completed or can be completed prior to the expiry date of the Original Undertaking (i.e., 15 June 2016), China Shipping has adjusted the part related to bulk shipping business of the Original Undertaking as the following:

Upon completion of the proposed material asset restructuring plan, the Company will agree to exempt the undertaking under item 1 and item 2 of the Original Undertaking (i.e. (2)(a) and (2)(b) above) that bulk shipping assets should be injected into the Company or disposed of; and the undertaking under item 4 (i.e. 2(d) above) regarding lease and entrusted operation of the bulk shipping assets prior to injection or disposal thereof (the “ Exemption ”). In the event that the proposed material asset restructuring plan fails to proceed to completion, the

— 13 —

Original Undertaking shall continue to be performed whereas the term of the undertaking will extend to within one year from the date of announcement of termination of the proposed material asset restructuring plan.

Please refer to the announcement of “Exemption of the Non-competition Undertaking of China Shipping” issued by the Company dated 22 April, 2016 for further details. The Exemption has been proposed to the annual general meeting of the Company to be held on 20 May, 2016.

China Shipping has proactively performed its undertakings for avoiding peer competition and has taken necessary steps since the listing of A shares of the Company with efforts so as to eliminate and prevent peer competition with the Company.

III. ABOUT THE REDUCTION OF RELATED PARTY TRANSACTIONS

1. China Shipping and other enterprises controlled by it and the Company shall avoid or reduce related party transactions so far as possible. For related party 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 related party 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.

2. China Shipping will exercise the rights of shareholders in strict accordance with the laws and regulation such as the “Company Law” and the articles of association of the Company; exercise the rights of shareholders in accordance with the relevant provisions at the general meetings of the Company; fulfill the obligation of abstaining from voting on related party transactions of China Shipping and other enterprises controlled by it at the general meetings of the Company.

This undertaking shall continue to be in force during the period in which China Shipping is the controlling shareholder of the Company.

— 14 —

IV. UNDERTAKINGS ON SETTLING THE ISSUE OF CAPITAL OCCUPATION

To protect the interests of minority shareholders in listed company, China Shipping as the controlling shareholder of the Company and COSCO Group as the counterparty of the Company in the material asset restructuring hereby jointly make the following further undertakings in relation to the debts arising from borrowings and payables between CS Bulk and its subsidiaries and the Company and its subsidiaries:

1. 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 the 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;

2. COSCO Group agrees to take joint and several liabilities 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;

3. China Shipping agrees to provide necessary financial assistance to CS Bulk and its subsidiaries for their capital requirements in daily operation since the date of this letter of undertakings.

4. V. PROFIT FORECAST AND COMPENSATION UNDERTAKINGS BY SHANGHAI SHIPPING (GROUP) COMPANY, A WHOLLY-OWNED SUBSIDIARY OF CHINA SHIPPING, IN AN EQUITY TRANSFER

China Shipping Tanker Co., Limited, 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”) from Shanghai Shipping (Group) Company for RMB830 million on 30 July 2014. Shanghai Shipping (Group) Company issued a “Letter of Compensation Undertakings” on 20 August 2014, pursuant to which Shanghai Shipping (Group) Company undertook that after completion of the transaction, when the Company announced its annual reports for the years 2014, 2015 and 2016, if the audited net profit attributable to shareholders of the parent company of Shanghai Beihai Shipping Company Limited 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),

— 15 —

Shanghai Shipping (Group) Company will make a cash payment equivalent to 20% of the shortfall in net profit to China Shipping Tanker Co., Limited within 10 working days after announcement of the Company’s annual report for that year.

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

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

4 Appendix

Consolidated Balance Sheet

	Items	Items		31 March 2016	31 March 2016	31 December 2015	31 December 2015
					RMB		RMB
	Current assets
	Cash and Cash Equivalents			3,341,519,347.08		2,085,888,552.68
	Notes Receivable			587,171,411.97		457,141,777.86
	Accounts Receivable			1,444,455,845.90		1,816,968,647.86
	Funds paid in advance			617,726,589.88		362,656,212.35
	Dividends Receivable			16,322,874.05		291,322,874.05
	Other Receivables			146,883,096.22		214,246,724.20
	Inventory			524,106,054.31		582,427,194.90
	Other Current Assets			633,997,468.84		655,249,382.75
	Total Current Assets			7,312,182,688.25		6,465,901,366.65
	Non-current liabilities
	Financial assets available for sale 41,036,183.79					35,379,106.60
	Long-term receivables			967,971,170.11		2,119,286,105.71
	Long-term equity investment			6,471,336,665.86		6,443,160,078.33
	Investment properties			1,088,658,594.00		1,088,658,594.00
	Fixed assets			44,050,426,036.07		44,837,979,020.09
	Construction in progress			7,774,931,681.08		6,883,440,753.35
	Intangible assets			10,575,514.18		14,487,842.43
	Long-term deferred expenses			9,690,296.13		8,700,496.93
	Deferred income tax asset			481,659,930.55		481,659,930.55
	Total non-current assets			60,896,286,071.77		61,912,751,927.99
	Total asset			68,208,468,760.02		68,378,653,294.64

— 16 —

	Items	Items	**31 March **	2016	31 December 2015
				RMB	RMB
	Current liabilities
	Short-term borrowings		5,758,763,031.19		5,389,593,406.22
	Derivative financial liabilities 524,017.12				508,348.30
	Accounts payable		1,007,064,307.77		904,437,611.48
	Receipts in advance		191,200,384.76		269,052,486.46
	Salaries and wages payable 44,639,678.55				42,245,076.39
	Taxes payable		105,395,163.25		163,184,585.04
	Interests payable		429,847,711.19		245,843,657.37
	Other payables		199,362,912.43		143,075,495.36
	Non-current liabilities to be
	mature within one year		17,000,000.00		2,863,529,983.38
	Total current liabilities		7,753,797,206.26		10,021,470,650.00
	Non-current liabilities
	Long-term borrowings		27,276,603,760.66		25,453,380,650.36
	Bonds payable		3,979,361,217.68		3,978,488,211.00
	Long-term payables		1,703,865,125.02		1,553,542,641.99
	Long-term Salaries and wages
	payable		98,319.33		98,319.33
	Estimated liabilities		285,679,277.49		266,762,059.30
	Deferred income		631.84		631.84
	Deferred income tax liabilities 170,322,724.97				170,322,724.97
	Other non-current liabilities 660,504,207.42				411,385,025.09
	Total non-current liabilities 34,076,435,264.41				31,833,980,263.88
	Total liabilities		41,830,232,470.67		41,855,450,913.88
	Shareholders’ equity
	Share capital		4,032,032,861.00		4,032,032,861.00
	Capital reserve		7,922,119,727.43		7,922,119,727.43
	Other comprehensive income -680,395,431.56				-541,139,459.47
	Specific reserve		67,889,506.28		82,625,287.88
	Surplus reserve		2,877,436,346.44		2,877,436,346.44
	Undistributed profit		11,478,810,388.43		11,324,130,735.94
	Total equity attributable to
	owners of the parent company 25,697,893,398.02				25,697,205,499.22
	Minority interests		680,342,891.33		825,996,881.54
	Total shareholders’ equity 26,378,236,289.35				26,523,202,380.76
	Total liabilities and
	shareholders’ equity		68,208,468,760.02		68,378,653,294.64

— 17 —

Balance Sheet of the Company

	Items	Items	31 March 2016	31 March 2016	31 December 2015
			RMB		RMB
	Current assets
	Cash and Cash Equivalents 672,919,684.82				375,220,780.02
	Interests receivable		184,167,316.15		88,067,339.12
	Dividends Receivable				275,000,000.00
	Other Receivables		9,788,305,265.28		10,093,145,327.93
	Other Current Assets		12,833,103.17		12,801,345.16
	Total Current Assets		10,658,225,369.42		10,844,234,792.23
	Non-current liabilities
	Financial assets available		for sale 29,454,546.00		29,454,546.00
	Held-to-maturity investments 10,064,612,000.00				10,064,936,000.00
	Long-term equity investment 16,939,860,301.67				17,017,161,932.37
	Investment properties		1,226,464,130.99		1,226,464,131.00
	Fixed assets		64,879,660.73		65,441,435.65
	Intangible assets		4,432,931.34		5,090,947.08
	Total non-current assets		28,329,703,570.73		28,408,548,992.10
	Total asset		38,987,928,940.15		39,252,783,784.33
	Current liabilities
	Short-term borrowings		323,060,000.00		824,680,000.00
	Salaries and wages payable 1,586,364.33				1,318,878.09
	Taxes payable		9,157,563.96		9,244,707.98
	Interests payable		231,323,435.04		131,409,729.47
	Other payables		2,169,916,984.40		2,078,702,087.16
	Total current liabilities		2,735,044,347.73		3,045,355,402.70
	Non-current liabilities
	Long-term borrowings		5,800,000,000.00		5,800,000,000.00
	Bonds payable		3,979,361,217.68		3,978,488,211.00
	Deferred income tax liabilities 169,250,983.65				169,250,983.65
	Total non-current liabilities 9,948,612,201.33				9,947,739,194.65
	Total liabilities		12,683,656,549.06		12,993,094,597.35
	Shareholders’ equity
	Share capital		4,032,032,861.00		4,032,032,861.00
	Capital reserve		7,765,430,636.94		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		11,355,088,761.40		11,310,505,557.29
	Total shareholders’ equity 26,304,272,391.09				26,259,689,186.98
	Total liabilities and
	shareholders’ equity		38,987,928,940.15		39,252,783,784.33

— 18 —

Consolidated Income Statement

	Items	Items		**January-March 2016 **	**January-March 2016 **	January-March 2015
				RMB		RMB
	1.	Total operating revenue		3,036,681,555.90		2,921,154,760.26
		Including: Revenue from		3,036,681,555.90		2,921,154,760.26
		operations
	2.	Total cost of sales		2,851,871,508.35		2,830,282,330.98
		Including: Operating cost		2,505,940,715.88		2,452,438,702.07
		Business taxes and other		4,059,749.60		3,758,366.65
		surcharges
		Sales expenses		23,130,122.37		14,667,689.66
		Administrative expenses		96,731,391.90		87,888,125.64
		Financial expenses		222,009,528.60		271,529,446.96
		Add: Investment income (“-”		28,176,587.53		2,920,045.40
		for investment loss)
		Including: investment		69,236,862.73		17,208,746.75
		income from associates
		and joint ventures
	3.	Operating profit (“-” for		212,986,635.08		93,792,474.68
		operating loss)
		Add: Non-operating revenue		16,275,934.50		36,431,703.73
		Less: Non-operating		1,265,271.50		1,939,466.47
		expenditure
		Including: Loss arising from		2,926.87		133,755.52
		disposal of non-current
		assets
	4.	Gross profit (“-” for gross		227,997,298.08		128,284,711.94
		loss)
		Less: Income tax		71,655,524.31		49,667,265.23
	5.	Net profit (“-” for net	loss)	156,341,773.77		78,617,446.71
		Net profit attributable	to	154,679,652.49		65,946,282.59
		owners of parent company
		Net profit attributable	to	1,662,121.28		12,671,164.12
		minority shareholders
	6.	Other comprehensive net		-286,572,083.58		-49,197,448.29
		income after tax
		Other comprehensive net		-139,255,972.09		-35,167,140.03
		income after tax attributable
		to owners of parent company

— 19 —

	Items	Items	**January-March 2016 **	**January-March 2016 **	**January-March 2016 **	January-March 2015	January-March 2015
					RMB		RMB
		Other comprehensive income		-139,255,972.09		-35,167,140.03
		to be re-classified to profit
		or loss
		(1) effective	parts of profit	-102,753,292.99		-58,895,829.30
		or loss on cash flow
		hedges
		(2) The difference between			-36,502,679.10	23,728,689.27
		the translation of
		foreign currency
		financial	statements
		Other comprehensive net		-147,316,111.49		-14,030,308.26
		income after tax attributable
		to minority shareholders
	7.	Total comprehensive income		-130,230,309.81		29,419,998.42
		Total comprehensive income			15,423,680.40	30,779,142.56
		attributable to owners of
		parent company
		Total of comprehensive		-145,653,990.21		-1,359,144.14
		income attributable to
		minority shareholders
	8.	Earnings per share
		(1) Basic earnings per share			0.0384	0.0180
		(RMB per share)
		(2) Diluted earnings per share			0.0384	0.0164
		(RMB per share)

— 20 —

Income Statement of the Company

				January-March	January-March	January-March	January-March
	Items				2016	2015
					RMB	RMB
	1.	Total operating revenue			4,849,476.92	16,776,310.61
		Less: Operating cost				24,462,166.25
		Business taxes and other
		surcharges			274,612.92	380,990.00
		Administrative expenses			7,307,764.05	5,312,882.61
		Financial expenses			100,659,804.31	104,232,152.33
		Add: Investment income (“-”
		for investment loss)			147,944,090.34	76,688,548.21
		Including:	investmentincome
		from associates and joint
		ventures				-4,769,042.26
	2.	Operating profit (“-” for
		operating loss)			44,551,385.98	-40,923,332.37
		Add: Non-operating revenue			40,000.00
		Less: Non-operating
		expenditure			8,181.87	37,080.00
		Including:	Loss arising from
		disposal of non-current
		assets			2,926.87
	3.Gross profit (“-” for gross loss)				44,583,204.11	-40,960,412.37
	4.	Net profit (“-” for net loss)			44,583,204.11	-40,960,412.37
	5.	Total comprehensive income			44,583,204.11	-40,960,412.37
	6.	Earnings per	share
		(1) Basic earnings per share
		(RMB per share)			0.0111	-0.0102
		(2) Diluted earnings per share
		(RMB per share)			0.0111	-0.0102

— 21 —

Consolidated Cash Flow Statement

				January-March	January-March	January-March
	Items			2016		2015
				RMB		RMB
	1.	Cash flows from operating
		activities
		Cash received from sales of
		goods and provision of
		services		3,150,062,762.21		2,580,906,026.45
		Cash received from tax rebates		39,599,717.52		16,879,104.77
		Cash received from other
		related operating activities		252,940,321.09		284,090,543.34
		Subtotal of cash inflow from
		operating activities		3,442,602,800.82		2,881,875,674.56
		Cash paid for goods	and
		services		1,538,409,667.16		1,226,364,115.02
		Cash paid to or on behalf of
		employees		370,012,785.59		391,899,011.40
		Taxes paid		174,908,896.88		50,446,762.49
		Other cash paid relating to
		operating activities		328,734,450.15		384,388,808.17
		Subtotal of cash outflow from
		operating activities		2,412,065,799.78		2,053,098,697.08
		Net cash flows from	operating
		activities		1,030,537,001.04		828,776,977.48
	2.	Cash flows from investing
		activities
		Cash received from disposal of
		investments		1,133,903,261.73
		Cash received from gains in
		investments		362,278,615.53
		Net cash inflow from disposal
		of fixed, intangible and other
		long-term assets		5,030.00		310,288,396.47
		Subtotal of cash inflow from
		investing activities		1,496,186,907.26		310,288,396.47
		Cash paid for purchase of
		fixed, intangible and other
		long-term assets		417,098,548.12		951,680,429.88
		Cash paid for investment		45,704,615.56		66,652,288.96

— 22 —

				January-March	January-March	January-March
	Items				2016	2015
					RMB	RMB
		Subtotal of cash outflow from
		investing activities		462,803,163.68		1,018,332,718.84
		Net cash flows from investing
		activities		1,033,383,743.58		-708,044,322.37
	3.	Cash flows from financing
		activities
		Cash received from
		borrowings		1,042,612,409.57		3,076,223,766.33
		Cash received relating to other
		financing activities				100,247,927.02
		Subtotal of cash inflow	from
		financing activities		1,042,612,409.57		3,176,471,693.35
		Cash paid for payment of
		debts		1,696,749,657.68		3,622,408,711.91
		Cash paid for distribution of
		dividends or profits and for
		interest expenses		132,921,130.71		171,498,731.89
		Cash paid for other related
		financing activities		2,519,254.16		1,787,619.46
		Subtotal of cash outflow from
		financing activities		1,832,190,042.55		3,795,695,063.26
		Net cash flows from financing
		activities		-789,577,632.98		-619,223,369.91
	4.	Effect on cash and cash
		equivalents from change of
		exchange rates		-18,712,317.24		2,937,261.97
	5.	Net increase in cash and
		cash equivalents		1,255,630,794.40		-495,553,452.83
		Add: Balance of cash and cash
		equivalents at the beginning
		of the Reporting Period		2,085,888,552.68		3,061,140,277.90
	6.	Balance of cash and cash
		**equivalents at the end **	of the
		Reporting Period		3,341,519,347.08		2,565,586,825.07

— 23 —

Cash Flow Statement of the Company

				January-March	January-March	January-March
	Items			2016		2015
				RMB		RMB
	1.	Cash flows from operating
		activities
		Cash received from other
		related operating activities		12,410,781.36		3,015,380,252.77
		Subtotal of cash inflow from
		operating activities		12,410,781.36		3,015,380,252.77
		Cash paid for goods	and
		services		32,010.44		16,849.92
		Cash paid to or on behalf of
		employees		3,467,136.56		3,889,674.05
		Taxes paid		389,970.57		2,261,307.42
		Other cash paid relating to
		operating activities		112,941,522.86		520,642,387.66
		Subtotal of cash outflow from
		operating activities		116,830,640.43		526,810,219.05
		Net cash flows from	operating
		activities		-104,419,859.07		2,488,570,033.72
	2.	Cash flows from investing
		activities
		Cash received from gains in
		investments		430,851,716.22		99,754,444.44
		Subtotal of cash inflow from
		investing activities		430,851,716.22		99,754,444.44
		Cash paid for investment				2,500,000,000.00
		Subtotal of cash outflow from
		investing activities				2,500,000,000.00
		Net cash flows from	investing
		activities		430,851,716.22		-2,400,245,555.56
	3.	Cash flows from financing
		activities
		Cash received from
		borrowings				401,906,333.33
		Cash received relating to other
		financing activities				298,128,116.44
		Subtotal of cash inflow from
		financing activities				700,034,449.77

— 24 —

				January-March	January-March	January-March	January-March
	Items				2016		2015
					RMB		RMB
		Cash paid for payment of
		debts				534,715,437.82
		Cash paid for distribution of
		dividends or profits and for
		interest expenses		28,720,011.68		39,900,408.32
		Cash paid for other related
		financing activities				292,958,196.92
		Subtotal of cash outflow from
		financing activities		28,720,011.68		867,574,043.06
		Net cash flows from financing
		activities		-28,720,011.68		-167,539,593.29
	4.	Effect on cash and cash
		**equivalents from **	change of
		exchange rates			-12,940.67	2,236,169.30
	5.	Net increase in cash and
		cash equivalents		297,698,904.80		-76,978,945.83
		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		672,919,684.82		1,052,676,113.15

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.

Shanghai, the PRC 28 April 2016

By order of the Board

China Shipping Development Company Limited Yao Qiaohong

Company Secretary

As at the date of this announcement, the board of directors of the Company comprises Mr. Xu Lirong, Mr. Huang Xiaowen, Mr. Ding Nong, Mr. Yu Zenggang, Mr. Yang Jigui, Mr. Han Jun and Mr. Qiu Guoxuan as 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.

— 25 —