RemeGen Co., Ltd. — Interim / Quarterly Report 2017

Aug 29, 2017

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Overseas Chinese Town (Asia) Holdings Limited (Incorporated in the Cayman Islands with limited liability)

Stock Code: 03366

InterIm report 2017

Contents
Corporate Information	2
Management Discussion and Analysis	4
Directors’ Interests	18
Interests and Short Positions of Substantial
Shareholders and Other Persons	19
Share Option Scheme	21
Corporate Governance	23
Interim Financial Report	24

2 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Corporate Information

Registered Office

Clifton House

PO Box 1350 GT, 75 Fort Street Grand Cayman, Cayman Islands

Head Office and Principal Place of Business

Board of Directors

Suite 3203-3204, Tower 6 The Gateway, Harbour City Canton Road, Tsim Sha Tsui Kowloon, Hong Kong

Executive Directors

Mr. He Haibin (Chairman) Ms. Xie Mei (CEO) Mr. Lin Kaihua

Non-executive Director

Mr. Zhang Jing

Independent Non-executive Directors Mr. Lu Gong Ms. Wong Wai Ling Professor Lam Sing Kwong Simon

Audit Committee/ Remuneration Committee

Nomination Committee Qualified Accountant and Company Secretary

Ms. Wong Wai Ling (Chairman) Professor Lam Sing Kwong Simon Mr. Zhang Jing

Mr. He Haibin (Chairman) Ms. Wong Wai Ling Professor Lam Sing Kwong Simon

Mr. Fong Fuk Wai (FCPA, FCCA, ACA)

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 3

Corporate Information

Auditors RSM Hong Kong Certified Public Accountants 29th Floor, Lee Garden Two 28 Yun Ping Road Causeway Bay Hong Kong Legal Advisers as to Loong & Yeung Hong Kong Law Room 1603, 16/F, China Building 29 Queen’s Road Central Central, Hong Kong Principal Share Registrar Estera Trust (Cayman) Limited and Transfer Office PO Box 1350, Clifton House, 75 Fort Street, Grand Cayman, Cayman Islands Hong Kong Branch Computershare Hong Kong Investor Share Registrar Services Limited and Transfer Office Shops 1712-16, 17/F, Hopewell Centre 183 Queen’s Road East, Hong Kong Principal Bankers China Construction Bank (Asia) Corporation Limited DBS Bank (Hong Kong) Limited Hang Seng Bank Limited Nanyang Commercial Bank OCBC Wing Hang Bank Limited Standard Chartered Bank (HK) Ltd. Stock Information Listing Date: 2 November 2005 Stock Code: 03366 Stock Short Name: OCT (ASIA) Company’s Website http://www.oct-asia.com

4 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Management Discussion and Analysis

OPERATINg RESuLTS AND BuSINESS REvIEW

In the first half of 2017, the global economy entered into the stage of recovery. The economies of the countries in the emerging market presented stable and favorable momentum. As motivated by the macro economic policies focusing on the structural reform on the supply side, the Chinese economy had its economic structure further optimized and achieved a solid start overall, although the foundation for bottoming out was still relatively weak. Under these complex domestic and international economic conditions, Overseas Chinese Town (Asia) Holdings Limited (the “Company”) together with its subsidiaries (the “Group”) steadily implemented its strategic planning and pushed forward the development of various businesses by leveraging its extensive experience and high quality products.

During the Period Under Review, the Group recorded a revenue of approximately RMB1.94 billion, representing a decrease of approximately 9.1% from the corresponding period of 2016. Profit from operations amounted to approximately RMB398.49 million, representing an increase of approximately 23.9% from the corresponding period of 2016. Furthermore, the profit attributable to owners of the Company was approximately RMB40.82 million, representing a decrease of approximately 80.7% from the corresponding period of 2016. The decrease was primarily due to the fact that the Beijing Unique Garden Project, which was developed by Beijing Guangying Residential Property Development Limited (北京廣盈房地產開發有限公司) (“Beijing Guangying”), an associate of the Company, had entered into the stage of the sales of remaining flats, therefore resulting in the significant drop in the share of profits of associates attributable to the Company. Excluding the effect of the aforesaid share of profits of associates attributable to the Company, the profit attributable to owners of the Company would have recorded an increase over the same period in 2016.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 5

Management Discussion and Analysis

Comprehensive Development Business

In the first half of 2017, the significant differentiation was seen among cities in terms of regulatory policies for the real estate market in the PRC with tightening policies in popular cities. Against the backdrop of emphasizing the nature of living for housing, the real estate market in the PRC continued to move forward. The market demand for real estate in the first-tier cities and the core second-tier cities remained buoyant. However, due to the frequent intensification of house purchase restrictions and lending restrictions as well as various regulatory measures, sales in the first half of 2017 recorded a significant decrease as compared with the same period of last year while the housing prices remained stable. On the one hand, both the sales volume and price in the second-tier and key third-tier cities increased in general with overall stable performance. On the other hand, the real estate in third-tier and fourth-tier cities continued to face severe pressure for destocking. The Group has always upheld the strategy of deep plowing in the first-tier and second-tier cities with a positive and prudent attitude amidst the complex and ever-changing market environment to achieve steady development in comprehensive development business.

For the Period Under Review, the comprehensive development business of the Group recorded a revenue of approximately RMB1.56 billion, representing a decrease of approximately 11.7% from the corresponding period of 2016. Furthermore, the profit attributable to owners of the Company for comprehensive development business was approximately RMB37.25 million, representing a decrease of approximately 82.5% from the corresponding period of 2016. Excluding the effect of the share of profits of associates attributable to the Company, the profit attributable to owners for comprehensive development business would have recorded an increase over the same period in 2016.

6 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Management Discussion and Analysis

During the Period Under Review, the Shanghai Suhewan Project was mainly engaged in the sales of waterfront multi-storey residential properties which are highly scarce in the market, luxury high-rise residential tower, low-density residential properties and some boutique business premises. The contracted sales area and amount were approximately 5,500 sq.m. and approximately RMB543.00 million, respectively, and the settled area and amount were approximately 13,000 sq.m. and approximately RMB1.26 billion, respectively. During the Period Under Review, the Shanghai Suhewan Waterfront Independent Mansions won “International Property Awards 2017-2018 – Asia Pacific Best Architecture Single Residence”. The Shanghai Suhewan Project received numerous awards, which was a high recognition for the overall project planning and product design, as well as a general acknowledgement to the development capability and product development of our brand OCT.

During the Period Under Review, Chengdu Tianfu OCT Industry Development Company Limited (“Chengdu OCT”) focused on the sales of high-end office properties, high-rise residential properties, multi-storey residential properties and some low-density residential properties. The contracted sales area and amount were approximately 19,900 sq.m. and approximately RMB161.00 million, respectively, and the settled area and amount were approximately 18,700 sq.m. and approximately RMB147.00 million, respectively. The current rentable area for commercial use was approximately 98,500 sq.m., of which 88% was leased. During the Period Under Review, Chengdu Happy Valley achieved a revenue of approximately RMB96.52 million, which recorded a decrease of approximately 11% compared with the same period of last year, with a visitor flow of approximately 920,000, which remained broadly flat as compared with the same period of last year.

The Chongqing OCT Land Project enjoys a supreme location with rich landscape resources, overlooking the panorama of Jialing River with a Happy Valley theme park and large greenbelt in the neighborhood. Its major properties comprise mid-to-high end high-rise residential properties and multi-storey residential properties. The Chongqing OCT Land Project, in the first half of 2017, launched several batches of high-rise residential properties, which were well-received by the market and sold out once being offered on the market. During the Period Under Review, the contracted sales area and amount of the Chongqing OCT Land Project were approximately 151,700 sq.m. and approximately RMB1,699.00 million, respectively.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 7

Management Discussion and Analysis

Located at the core CBD in the downtown of Xi’an city, the OCT Chang’an Metropolis Project is a commercial landmark along the Chang’an Road. The project has a total gross floor area of approximately 104,700 sq.m., including high-end office properties such as Building 2# and Building 3#, as well as some car parking spaces. During the Period Under Review, 96% of the units in Building 2# of the OCT Chang’an Metropolis Project was leased with rental rates ranking at the forefront of the city. Being scarce in the market, Building 3# is a Grade A office building which is a major project of the Group in 2017 and is launching leasing. Recently, a number of domestic and foreign well-known enterprises including Taikang Life Insurance and SKECHERS have become tenants.

During the Period Under Review, the Beijing Unique Garden Project developed by Beijing Guangying, an associate of the Company, has entered into the stage of the sales of remaining flats. The contract sales area and amount were approximately 3,800 sq.m. and approximately RMB49.00 million, respectively, and the settled area and amount were approximately 4,500 sq.m. and approximately RMB282.00 million, respectively. During the Period Under Review, the Beijing Unique Garden Project contributed an investment return of approximately RMB27.60 million to the Company.

Chengdu Baoxin Quansheng Project owns a piece of land located in Jinniu District in Chengdu city with a total site area of 174,900 sq.m. which comprises properties including high-rise residential property, ground-floor shops, commercial duplexes, apartment buildings and underground car parking space. During the Period Under Review, the contracted sales area and amount of the Chengdu Baoxin Quansheng Project were approximately 46,200 sq.m. and approximately RMB693.00 million, respectively.

8 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Management Discussion and Analysis

Paper Packaging Business

During the Period Under Review, facing unfavorable factors including fierce market competition and continued increase in operating costs, the Group secured the stable operation of the paper packaging business through the integration of corporate resources and enhancement of operating efficiency. During the Period Under Review, the paper packaging business of the Group recorded a revenue of approximately RMB380.06 million, representing an increase of approximately 3.4% as compared with the same period of 2016, and the profit attributable to owners of the Company of approximately RMB3.57 million, as compared with a loss of approximately RMB1.55 million for the same period of 2016.

Investment and Fund Business

During the Period Under Review, the Group acquired 8.26% equity interest in Minsheng Education Group Company Limited (“Minsheng Education”, stock code: 1569.HK) with an investment cost of HK$463 million. The primary focus of Minsheng Education is to provide high-quality private formal higher education in the PRC dedicated to nurturing professional talents. The Group is optimistic about the education industry in the PRC and its prospects.

During the Period Under Review, the Group entered into a limited partnership agreement with a number of partners to establish Shanghai Libao Huachen Investment Centre (LLP) (“Shanghai Libao Huachen Fund”) with an aggregate capital of RMB400 million, among which the Group invested a total amount of RMB30 million. Shanghai Libao Huachen Fund principally invests in culture industry, including but not limited to segments of video and media, sports and entertainment, leisure and tourism as well as online education segment. During the Period Under Review, Shanghai Libao Huachen Fund invested in a number of projects including those in the sports and culture industries.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 9

Management Discussion and Analysis

The Group participated in the establishment of the Capital Fortune Investment New Industries Investment Fund to look for enterprises with promising growth in emerging industries. During the Period Under Review, the fund invested in a number of projects including those in new-energy automobiles and mobile internet sectors.

OuTLOOK

Looking forward to the second half of 2017, upon the improvement in the international trade as well as market confidence, it is expected that the global economy will continue to recover. However, in view of the less coordinated international macro economic policies and the emergence of trade and investment protectionism, the uncertainties will remain in the international market. In respect of domestic economy, with the preliminary results shown in “financial deleveraging”, the global recovery will provide support for the overseas market demand in the PRC. The stability in demand for domestic consumption and investment will stabilize the overall economy, although the foundation for the stable and favorable momentum will still be relatively weak. The PRC government will further push forward the structural reform on the supply side and implement proactive financial policies and sound monetary policies to maintain stable economic growth.

For real estate market, the Central Economic Work Conference proposed the idea of suppressing the bubbles in the real estate market to promote stable and healthy development. The policy will persist in risk control and destocking measures. The market-oriented adjustments in the industry are expected to sustain the pace in the first half of the year while the market segregation will also further intensify. It is expected that the real estate market in the first-tier and second-tier cities will maintain stable development. However, regulatory polices such as house purchase restrictions. lending restrictions and price limitation will remain in varying degrees. The third-tier and fourth-tier cities will carry out destocking in an active manner. The Group maintains its prudently optimistic outlook for the domestic real estate market in the second half of 2017.

10 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Management Discussion and Analysis

Comprehensive Development Business

For the second half of 2017, the Group will focus on making greater efforts in promoting its new products in the market and accelerating the turnaround of products by paying close attention to the real estate policies promulgated by the central and local governments and optimizing development strategies based on the market conditions in order to speed up the recovery of funds and enhance operation efficiency. The planning of each comprehensive development project is as follows:

The Shanghai Suhewan Project will continue to introduce waterfront multi-storey residential properties which possess the scarce landscape resources, high-rise residential towers and boutique business premises and expect to launch the highly-anticipated Bulgari Hotel by the end of the year. As the strategic planning of “One Shaft Three Belts” (一軸三帶) in new Jing’an District in Shanghai is freshly announced, the Suhewan Segment, being a core segment of the new Jing’an District, is expected to be the new development core of Shanghai. As an iconic commercial complex project of the Suhewan Segment, the Shanghai Suhewan Project will remain in the spotlight of the market. The Chengdu OCT Project will launch the high-end customized villa in the only eyot of the downtown of Chengdu and a new phase of high-rise residential properties, and will continue its sale of low-density residential properties and high-end office products.

In the second half of 2017, we will continue to adhere to the leading development and operation concept, give full play to our advantages and actively concern and look for diversified investment opportunities. We will also accelerate the increase in project reserve and enhance our development potential by various means such as cooperation, mergers and investment.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 11

Management Discussion and Analysis

Paper Packaging Business

In order to optimize business structure and achieve strategic transformation, the Group will withdraw from the manufacturing procedure of the paper packaging business in stages and emphasize on taking various measures depending on the specific conditions of different companies under the name of “Huali” to expand the way of thinking for transformation development. The Group intends to dispose of its 100% equity interest in 上海華勵包裝貿易有限公司 (Shanghai Huali Packaging and Trading Co., Ltd.) through public tender and the disposal was officially listed on the Shanghai United Assets and Equity Exchange on 7 August 2017.

In the second half of 2017, as the Central Government expedites industrial upgrade, makes innovation in respect of economic development mode and deepens the reform of state-owned enterprises, under the guidance of its parent company OCT Group on two strategic themes, i.e. “culture + tourism + urbanization” and “tourism + internet + finance”, the Group will accelerate its pace of innovative development, push forward strategic transforming and upgrading, promote comprehensive industrial distribution and further improve and consolidate the important role of OCT Group’s overseas industrial financing platform. It will proactively acquire and foster high quality resources and businesses with strong cooperation with OCT industrial ecosphere and growth potentials by means of domestic and overseas direct investments, indirect investments (industrial funds), etc. and build new development drivers for the Company with innovative financial measures to continuously enhance its corporate value.

The Board is full of confidence in the future development prospects. The Group, with the support of its parent company, will also endeavor to create ideal return on investment for shareholders by fully leveraging OCT’s advantages in its brand, resources and experience following the work idea of “share, breakthrough and implementation”.

12 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Management Discussion and Analysis

Financial Review

As at 30 June 2017, the Group’s total assets were approximately RMB20.44 billion, whereas the Group’s total equity amounted to approximately RMB6.97 billion. The Group recorded a revenue of approximately RMB1.94 billion for the six months ended 30 June 2017, representing a decrease of approximately 9.1% over the same period of 2016, among which the revenue from the comprehensive development business was approximately RMB1.56 billion, representing a decrease of approximately 11.7% over the same period of 2016, mainly due to the decrease in the revenue contributed by Chengdu OCT; the revenue from the paper packaging business was approximately RMB380.06 million, representing an increase of approximately 3.4% over the same period of 2016, mainly due to the rise in selling price of products during the Period Under Review. Profit attributable to owners of the Company was approximately RMB40.82 million for the six months ended 30 June 2017, representing a decrease of approximately 80.7% over the same period of 2016, among which profit attributable to owners of the Company arising from the comprehensive development business was approximately RMB37.25 million, representing a decrease of approximately 82.5% over the same period of 2016, which was mainly due to a significant decrease in share of profits of associates; profit attributable to owners of the Company arising from the paper packaging business was approximately RMB3.57 million, while recorded a loss of approximately RMB1.55 million for the same period of 2016, mainly due to the rise in selling price of products during the Period Under Review. For the six months ended 30 June 2017, basic earnings per share were approximately RMB0.036, representing a decrease of approximately 88.0% over the same period of 2016 (same period in 2016: approximately RMB0.299).

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 13

Management Discussion and Analysis

For the six months ended 30 June 2017, the Group’s gross profit margin was approximately 28.7% (same period in 2016: approximately 24.8%), representing an increase of approximately 3.9 percentage points over the same period of 2016, among which the gross profit margin of the comprehensive development business was approximately 32.3%, representing an increase of approximately 4.6 percentage points over the same period of 2016, which was mainly due to the decrease of revenue recognized during the Period Under Review from units with low gross profit margin; the gross profit margin of the paper packaging business was approximately 13.9%, representing an increase of approximately 3.0 percentage points over the same period of 2016, which was mainly due to the rise in selling price of products during the Period Under Review.

Distribution Costs and Administrative Expenses

Distribution costs of the Group for the six months ended 30 June 2017 were approximately RMB61.93 million (same period in 2016: approximately RMB112.60 million), representing a decrease of approximately 45.0% over the same period of 2016, of which distribution costs of the comprehensive development business were approximately RMB40.47 million, representing a decrease of approximately 55.7% over the same period of 2016, which was mainly due to the decrease in the advertising expenses for Chengdu OCT as compared with the same period in last year, as well as the decrease in sales commissions as a result of decline in revenue from the comprehensive development business; distribution costs of the paper packaging business were approximately RMB21.46 million, which is substantially the same comparing to the same period of 2016.

The Group’s administrative expenses for the six months ended 30 June 2017 were approximately RMB110.22 million (same period in 2016: approximately RMB88.30 million), representing an increase of approximately 24.8% over the same period of 2016, of which administrative expenses of the comprehensive development business were approximately RMB84.81 million, representing an increase of approximately 18.4% over the same period of 2016, which was mainly due to the increase in financing handling charges and labor costs; administrative expenses of the paper packaging business were approximately RMB25.41 million, representing an increase of approximately 52.2% over the same period of 2016, which was mainly due to the increase in staff welfare expenses.

14 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Management Discussion and Analysis

Interest Expenses

The interest expenses of the Group were approximately RMB115.04 million for the six months ended 30 June 2017 (same period in 2016: approximately RMB127.21 million), representing a decrease of approximately 9.6% over the same period of 2016, of which interest expenses of the comprehensive development business were approximately RMB113.31 million, representing a decrease of approximately 9.0% over the same period of 2016, mainly due to the decline in loan interest rates; interest expenses of the paper packaging business were approximately RMB1.73 million, representing a decrease of approximately 34.7% over the same period of 2016, mainly due to the decrease in the amount of the loans related to the paper packaging business.

Dividends

The Board does not recommend the payment of an interim dividend for the six months ended 30 June 2017, taking into account the long-term development of the Company and its active participation in potential investment opportunities.

Inventories, Debtors’ and Creditors’ Turnover

The inventory turnover days of the Group’s paper packaging business were 39 days for the six months ended 30 June 2017, representing an increase of 4 days as compared with 35 days for the year ended 31 December 2016, mainly due to the increase in inventory. The debtors’ turnover days of the Group’s paper packaging business were 136 days for the six months ended 30 June 2017, representing an increase of 7 days as compared with 129 days for the year ended 31 December 2016, mainly due to the longer settlement period resulted from the change of payment method by some customers. The creditors’ turnover days of the Group’s paper packaging business were 47 days for the six months ended 30 June 2017, representing a decrease of 3 days as compared with 50 days for the year ended 31 December 2016, mainly due to the shortened credit period for enjoying the cash discount offered by the suppliers.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 15

Management Discussion and Analysis

Liquidity, Financial Resources and Capital Structure

The total equity of the Group as at 30 June 2017 was approximately RMB6.97 billion (31 December 2016: approximately RMB6.77 billion). As at 30 June 2017, the Group had current assets of approximately RMB13.74 billion (31 December 2016: approximately RMB14.26 billion) and current liabilities of approximately RMB8.25 billion (31 December 2016: approximately RMB8.46 billion). The current ratio was approximately 1.67 as at 30 June 2017, which was substantially the same as compared with 1.68 as at 31 December 2016. The Group generally finances its operations with internally generated cash flow, credit facilities provided by banks and shareholder’s loans.

As at 30 June 2017, the Group had outstanding bank and other loans of approximately RMB5.07 billion, without any fixed rate loans (31 December 2016: outstanding bank and other loans of approximately RMB4.28 billion, without any fixed rate loans). As at 30 June 2017, the interest rates of bank and other loans of the Group ranged from 1.15% to 6.38% per annum (31 December 2016: ranged from 1.05% to 6.38% per annum). Some of these bank loans were secured by floating charges of certain assets of the Group and corporate guarantees provided by certain subsidiaries of the Company. The Group’s gearing ratio (being the total borrowings including bills payable and loans divided by total assets) was approximately 45.0% as at 30 June 2017, representing an increase of approximately 1.8 percentage points as compared with 43.2% as at 31 December 2016, mainly due to the increase in loan balance as at the end of the Period Under Review.

As at 30 June 2017, approximately 26.5% of the total amount of outstanding bank and other loans of the Group was denominated in Renminbi (31 December 2016: approximately 37.3%), approximately 73.5% of which was denominated in Hong Kong Dollars (31 December 2016: approximately 50.6%) and approximately 0.0% of which was denominated in United States Dollars (31 December 2016: approximately 12.1%). As at 30 June 2017, approximately 82.0% of the total amount of cash and cash equivalents of the Group was denominated in Renminbi (31 December 2016: approximately 89.8%), approximately 16.4% of which was denominated in Hong Kong Dollars (31 December 2016: approximately 7.8%) and approximately 1.6% of which was denominated in United States Dollars (31 December 2016: approximately 2.4%).

16 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Management Discussion and Analysis

The Group’s liquidity position remains stable. The Group’s transactions and monetary assets are principally denominated in Renminbi, Hong Kong Dollars and United States Dollars. The Group has not experienced any material difficulties in or effects on its operations or liquidity as a result of fluctuations in currency exchange rates for the six months ended 30 June 2017. The Group did not enter into any foreign exchange forward contracts and other material financial instruments for hedging foreign exchange risks purpose for the six months ended 30 June 2017.

Contingent Liabilities

The Group has no contingent liabilities as at 30 June 2017 (31 December 2016: Nil).

Employees and Remuneration Policy

As at 30 June 2017, the Group employed approximately 2,887 full-time staff in total. The basic remuneration of the employees is determined with reference to the industry’s remuneration benchmark, the employees’ experience and their performance, and equal opportunities will be offered to all staff. Salaries of employees are maintained at a competitive level and are reviewed annually with reference to the relevant labour market and economic situation. Directors’ remuneration is determined with reference to a variety of factors including market conditions and responsibilities assumed by each director. Apart from the basic remuneration and statutory benefits, the Group also provides discretionary bonuses to the staff based upon the Group’s results and their individual performance.

The Group has not experienced any significant problems with its employees or disruption to its operations due to labour disputes nor has it experienced any difficulty in the recruitment and retention of experienced staff. The Group maintains a good relationship with its employees. Most members of the senior management have been working for the Group for many years.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 17

Management Discussion and Analysis

IMPORTANT EvENTS

Investment in Minsheng Education

On 6 March 2017, City Legend International Limited (“City Legend”), an indirect wholly-owned subsidiary of the Company, entered into the cornerstone investment agreement with Minsheng Education Group Company Limited (“Minsheng Education”), to subscribe for 332,000,000 Shares of Minsheng Education at the IPO Price. The primary focus of Minsheng Education is to provide high-quality private formal higher education in the PRC dedicated to nurturing professional talents with growth potential and prospects. This investment is expected to broaden the sources of profits of the Group. The subscription was completed on 21 March 2017 at a total effective subscription price of approximately HK$463,000,000, representing 8.26% of the total issued share capital of Minsheng Education. For further details, please refer to the announcement of the Company dated 6 March 2017.

Investment in Shanghai Libao Huachen Fund

On 17 March 2017, Shenzhen Huayou Investment Co., Ltd. (“Huayou Investment”), an indirect wholly-owned subsidiary of the Company, entered into the limited partnership agreement with Shanghai Rongzheng Libao Investment Management Co., Ltd., Shanghai Rongzheng Investment Advisory Co., Ltd., and other several partners to establish Shanghai Libao Huachen Investment Centre (LLP) (“Shanghai Libao Huachen Fund”) with an aggregate capital of RMB400 million, among which Huayou Investment invested a total amount of RMB30,000,000. Shanghai Libao Huachen Fund principally invests in culture industry, including but not limited to segments of video and media, sports and entertainment, leisure and tourism as well as online education segment, and segments of upgrading and reconstruction of such industries through internet and mobile internet. For further details, please refer to the announcement of the Company dated 17 March 2017.

18 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Directors’ Interests

As at 30 June 2017, no interests and short positions in the ordinary shares of HK$0.10 each in the share capital of the Company (the “Shares”), underlying Shares and debentures of the Company and any of its associated corporations (within the meaning of Part XV of the Securities and Futures Ordinance (“SFO”)) were held by the Directors and chief executives of the Company which have been notified to the Company and The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which were taken or deemed to have under such provisions of the SFO) or have been entered in the register maintained by the Company pursuant to section 352 of the SFO, or otherwise have been notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Companies set out in Appendix X of the Rules Governing the Listing of Securities (the “Listing Rules”) on the Stock Exchange (the “Model Code”).

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Interests and Short Positions of Substantial Shareholders and Other Persons

As at 30 June 2017, as far as is known to the Directors, the following persons (not being a Director or chief executive of the Company) had interests or short positions in the Shares or underlying Shares of the Company which fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO:

Long Position in Shares

			Approximate
Name of substantial		No. of	percentage of
shareholders	Capacity/Nature	Shares held	shareholding
Pacific Climax Limited	Beneficial owner	530,894,000	81.38%
(“Pacific Climax”)(note 1)		(long position)
Overseas Chinese Town	Interest of a controlled	530,894,000	81.38%
(HK) Company Limited	corporation_(note 2)_	(long position)
(“OCT (HK)”)
Shenzhen Overseas	Interest of a controlled	530,894,000	81.38%
Chinese Town Company	corporation_(note 3)_	(long position)
Limited (“OCT Ltd.”)
Overseas Chinese Town	Interest of a controlled	530,894,000	81.38%
Enterprises Company	corporation_(note 4)_	(long position)
(“OCT Group”)
Others
UBS Group AG	Person having a security	14,000	0.002%
	interest in shares	(long position)
	(note 5)
	Interest of a controlled	51,179,000	7.85%
	corporation_(note 5)_	(long position)

20 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Interests and Short Positions of Substantial Shareholders and Other Persons

Notes:

• (1) The interests held by Pacific Climax consist of (long position) in 434,894,000 ordinary shares and 96,000,000 convertible preference shares. Ms. Xie Mei and Mr. Lin Kaihua, both being executive Directors, and Mr. Zhang Jing, being a non-executive Director, are also directors of Pacific Climax.

• (2) OCT (HK) is the beneficial owner of all the issued share capital in Pacific Climax. Therefore, OCT (HK) is deemed, or taken to be interested in all the Shares beneficially held by Pacific Climax for the purpose of the SFO. Mr. He Haibin and Ms. Xie Mei, both being executive Directors, and Mr. Zhang Jing, being a non-executive Director, are also directors of OCT (HK).

• (3) OCT Ltd. is the beneficial owner of all the issued share capital of OCT (HK), which is in turn the beneficial owner of all the issued share capital of Pacific Climax. Therefore, OCT Ltd. is deemed, or taken to be interested in all the Shares which are beneficially owned by OCT (HK) and Pacific Climax for the purpose of the SFO. OCT Ltd. is a company incorporated in the PRC, the shares of which are listed on the Shenzhen Stock Exchange. OCT Ltd. is a subsidiary of OCT Group.

• (4) OCT Group is the beneficial owner of 53.47% of the issued shares of OCT Ltd., which is the beneficial owner of all the issued shares of OCT (HK) and in turn, the beneficial owner of all the issued share capital of Pacific Climax. Therefore, OCT Group is deemed, or taken to be interested in all the Shares which are beneficially owned by OCT Ltd., OCT (HK) and Pacific Climax for the purpose of the SFO.

• (5) The interests of UBS Group AG consist of the interests (long position) in 41,618,000 shares, 6,180,000 shares, 3,372,000 shares, 8,000 shares and 1,000 shares (total: 51,179,000 shares) held by UBS Fund Management (Luxembourg) S.A., UBS Asset Management (Hong Kong) Ltd, UBS Asset Management (Singapore) Ltd, UBS Fund Management (Switzerland) AG and UBS AG, which are all wholly-owned by UBS Group AG. UBS Group AG is also interested in 14,000 shares (long position) in the capacity as a person having a security interest in the shares. Therefore, UBS Group AG is deemed, or taken to be interested in the total of 51,193,000 shares (long position) for the purpose of the SFO.

Save as disclosed above, as at 30 June 2017, no other interests required to be recorded in the register kept under section 336 of the SFO have been notified to the Company.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 21

Share Option Scheme

Under the ordinary resolution passed at the extraordinary general meeting on 15 February 2011, the Board adopted a new share option scheme (the “New Scheme”). The purpose of the New Scheme is to attract and retain the best available personnel, to provide additional incentive to the employees (full-time and part-time), Directors, consultants and advisers of the Group and to promote the business development of the Group. The New Scheme shall be valid and effective for a period of ten years ending on 14 February 2021, unless terminated earlier by shareholders of the Company at general meeting.

The participants of the New Scheme include any full-time or part-time employee, Director, advisor and professional consultant of the Group or any member of the Group. The Directors may at their absolute discretion and on such terms as they may think fit, propose any eligible people under the New Scheme to take up options. An offer for the grant of options must be accepted within 28 days inclusive of the day on which such offer was made. The amount payable by each grantee of an option to the Company on acceptance of the offer for the grant of an option is HK$1.00.

The subscription price of a share in respect of any particular option granted under the New Scheme shall be a price solely determined by the Board and notified to a participant and shall be at least the higher of: (i) the closing price of the shares as stated in the Stock Exchange’s daily quotations sheet on the date of grant of the option; (ii) the average of the closing prices of the shares as stated in the Stock Exchange’s daily quotations sheets for the 5 business days immediately preceding the date of grant of the option; and (iii) the nominal value of a share on the date of grant of the option.

The Company shall be entitled to issue options, provided that the total number of shares which may be issued upon exercise of all options to be granted under all the New Schemes and any other share option scheme does not exceed 10% of the shares in issue at the date of approval of the

22 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Share Option Scheme

New Scheme. The Company may at any time refresh such limit, subject to the shareholders’ approval and issue of a circular in compliance with the Listing Rules, provided that the total number of shares which may be issued upon exercise of all options granted and yet to be exercised under all the New Schemes and any other share option scheme of the Company does not exceed 30% of the shares in issue at the time.

The total number of options available for issue under the New Scheme as at 30 June 2017 was 20,436,000 options, which represented approximately 3.13% of all the issued share capital of the Company as at 30 June 2017. An option may be exercised in accordance with the terms of the New Scheme at any time during a period as the Board may determine which shall not exceed ten years from the date of grant. The total number of shares issued and to be issued upon exercise of options granted to any grantee (including both exercised and outstanding options), in any 12-month period up to the date of grant shall not exceed 1% of the shares of the Company then in issue.

Pursuant to the terms of the New Scheme, the Company granted 30,100,000 options to some eligible participants (including some Directors and employees) at the exercise price of HK$4.04 and grant price of HK$1 per option on 3 March 2011. Details of the shares options granted under the New Scheme above are set out in the announcement of the Company dated 3 March 2011. As at 2 March 2016, all share options granted under the New Scheme expire. As at 30 June 2017, the total number of shares to be issued under the granted options is zero.

Apart from the foregoing, at no time during the review period prior to the date of this interim report was the Company, any of its holding companies, subsidiaries or fellow subsidiaries a party to any arrangement to enable the Directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 23

Corporate Governance

For the six months ended 30 June 2017, the Company has complied with all the applicable code provisions of the Corporate Governance Code as set out in Appendix 14 to the Listing Rules.

SECuRITIES TRANSACTIONS BY DIRECTORS

The Company has adopted the Model Code. The Board confirms that, having made specific enquiry with all Directors, for the six months ended 30 June 2017 the Directors have complied with the required standards as set out in the Model Code and its own code of conduct regarding the Directors’ securities transactions.

AuDIT COMMITTEE

The audit committee of the Company and the management have reviewed the unaudited interim results announcement and the unaudited interim report of the Group for the six months ended 30 June 2017, and discussed the internal control, accounting principles and practices adopted by the Group with the management of the Company.

PuRCHASE, SALE OR REDEMPTION OF SHARES

Neither the Company nor any of its subsidiaries has redeemed any of its shares during the six months ended 30 June 2017. During the same period, neither the Company nor any of its subsidiaries has purchased or sold any of its shares.

By Order of the Board

Overseas Chinese Town (Asia) Holdings Limited He Haibin Chairman

Hong Kong, 15 August 2017

24 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Interim Financial Report

Condensed Consolidated Statement of Profit or Loss For the six months ended 30 June 2017

Note Revenue 5 Cost of sales gross profit Other revenue Other net losses 6 Distribution costs Administrative expenses Other operating expenses Profit from operations Finance costs 7 Share of profits of associates Share of loss of a joint venture Profit before tax 7 Income tax expense 8 Profit for the period Attributable to: Owners of the Company Non-controlling interests Earnings per share (RMB) 9 Basic Diluted

Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 1,942,472 2,137,362 (1,384,434) (1,607,303) 558,038 530,059 18,509 21,995 (3,728) (285) (61,933) (112,604) (110,218) (88,302) (2,183) (29,167) 398,485 321,696 (115,036) (127,209) 33,351 272,325 (3,563) (471) 313,237 466,341 (139,108) (166,661) 174,129 299,680 40,822 211,566 133,307 88,114 174,129 299,680 0.036 0.299 0.036 0.283

The notes on pages 30 to 50 form part of this interim financial report.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 25

Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the six months ended 30 June 2017

Profit for the period Other comprehensive income for the period, net of tax: Items that will be reclassified to profit or loss: Exchange differences on translating foreign operations Net loss on revaluation of available-for- sale financial assets under other financial assets Total comprehensive income for the period Attributable to: Owners of the Company Non-controlling interests	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 174,129 299,680 144,830 (81,153) (9,770) – 135,060 (81,153) 309,189 218,527 175,882 130,413 133,307 88,114 309,189 218,527

The notes on pages 30 to 50 form part of this interim financial report.

26 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Condensed Consolidated Statement of Financial Position

At 30 June 2017

Note Non-current assets Fixed assets 10 – Investment property under development – Investment property – Property, plant and equipment – Interests in leasehold land held for own use Intangible assets Goodwill Investments in associates 11 Investment in a joint venture 12 Other financial assets Deferred tax assets Current assets Inventories 13 Trade and other receivables 14 Other financial assets Cash and cash equivalents 15	At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) – 821,096 2,367,978 1,556,753 1,362,566 1,227,053 606,856 617,031 4,337,400 4,221,933 1,918 2,092 570 570 1,189,015 1,634,164 15,981 19,544 1,000,414 247,320 153,300 154,251 6,698,598 6,279,874 10,070,047 10,490,803 493,479 530,196 – 1,159,700 3,174,820 2,077,758 13,738,346 14,258,457	At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) – 821,096 2,367,978 1,556,753 1,362,566 1,227,053 606,856 617,031 4,337,400 4,221,933 1,918 2,092 570 570 1,189,015 1,634,164 15,981 19,544 1,000,414 247,320 153,300 154,251 6,698,598 6,279,874 10,070,047 10,490,803 493,479 530,196 – 1,159,700 3,174,820 2,077,758 13,738,346 14,258,457
		821,096 1,556,753 1,227,053 617,031
		4,221,933 2,092 570 1,634,164 19,544 247,320 154,251
		6,279,874
		10,490,803 530,196 1,159,700 2,077,758
		14,258,457

The notes on pages 30 to 50 form part of this interim financial report.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 27

Condensed Consolidated Statement of Financial Position

At 30 June 2017

Note Current liabilities Trade and other payables 16 Receipts in advance Bank and other loans Related party loans Current tax liabilities Net current assets Total assets less current liabilities Non-current liabilities Bank and other loans Related party loans Deferred tax liabilities NET ASSETS CAPITAL AND RESERvES Share capital Reserves 17 Equity attributable to owners of the Company Non-controlling interests TOTAL EQuITY	At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) 2,026,213 2,845,650 1,893,224 1,423,911 3,915,244 2,559,663 262,000 1,212,000 148,461 421,618 8,245,142 8,462,842 5,493,204 5,795,615 12,191,802 12,075,489 1,157,345 1,716,975 3,863,274 3,380,348 203,141 211,464 5,223,760 5,308,787 6,968,042 6,766,702 67,337 67,337 3,027,644 2,959,611 3,094,981 3,026,948 3,873,061 3,739,754 6,968,042 6,766,702	At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) 2,026,213 2,845,650 1,893,224 1,423,911 3,915,244 2,559,663 262,000 1,212,000 148,461 421,618 8,245,142 8,462,842 5,493,204 5,795,615 12,191,802 12,075,489 1,157,345 1,716,975 3,863,274 3,380,348 203,141 211,464 5,223,760 5,308,787 6,968,042 6,766,702 67,337 67,337 3,027,644 2,959,611 3,094,981 3,026,948 3,873,061 3,739,754 6,968,042 6,766,702
		2,845,650 1,423,911 2,559,663 1,212,000 421,618
		8,462,842
		5,795,615
		12,075,489
		1,716,975 3,380,348 211,464
		5,308,787
		6,766,702
		67,337 2,959,611
		3,026,948 3,739,754
		6,766,702

The notes on pages 30 to 50 form part of this interim financial report.

28 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Condensed Consolidated Statement of Changes in Equity

For the six months ended 30 June 2017

Note At 1 January 2016 Total comprehensive income for the period Dividend approved and paid in respect of previous year 17(a) Changes in equity for the six months ended 30 June 2016 At 30 June 2016 At 1 January 2017 Total comprehensive income for the period Dividend approved and paid in respect of previous year 17(a) Changes in equity for the six months ended 30 June 2017 At 30 June 2017	(unaudited) Attributable to owners of the Company Share capital Share premium Contributed reserve Merger reserve Capital reserve Exchange reserve Investment revaluation reserve general reserve fund Enterprise expansion fund Retained profits Total Non- controlling interests Total equity RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
	67,337 36,884 147,711 24,757 53,277 (140,410) – 322,558 5,366 2,518,375 3,035,855 3,737,070 6,772,925
	– – – – – (81,153) – – – 211,566 130,413 88,114 218,527 – – – – – – – – – (93,547) (93,547) – (93,547)
	– – – – – (81,153) – – – 118,019 36,866 88,114 124,980
	67,337 36,884 147,711 24,757 53,277 (221,563) – 322,558 5,366 2,636,394 3,072,721 3,825,184 6,897,905
	67,337 36,884 147,711 24,757 53,277 (441,281) – 381,215 5,366 2,751,682 3,026,948 3,739,754 6,766,702
	– – – – – 144,830 (9,770) – – 40,822 175,882 133,307 309,189 – – – – – – – – – (107,849) (107,849) – (107,849)
	– – – – – 144,830 (9,770) – – (67,027) 68,033 133,307 201,340
	67,337 36,884 147,711 24,757 53,277 (296,451) (9,770) 381,215 5,366 2,684,655 3,094,981 3,873,061 6,968,042

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 29

Condensed Consolidated Statement of Cash Flows

For the six months ended 30 June 2017

Note Cash generated from operations Tax paid Net cash generated from operating activities Net cash generated from/ (used in) investing activities Net cash generated from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at 1 January Effect of foreign exchange rate changes Cash and cash equivalents at 30 June 15	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 962,005 1,094,678 (419,637) (616,763) 542,368 477,915 197,631 (824,673) 344,613 210,598 1,084,612 (136,160) 2,077,758 3,374,156 12,450 (74,712) 3,174,820 3,163,284

30 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

1. BASIS OF PREPARATION

The interim financial report has been prepared in accordance with Hong Kong Accounting Standard (“HKAS”) 34 “Interim Financial Reporting” issued by the Hong Kong Institute of Certified Public Accountants (the “HKICPA”) and the applicable disclosures required by the Rules Governing the Listing of Securities (the “Listing Rules”) on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”). It was authorised for issue on 15 August 2017.

The preparation of an interim financial report in conformity with HKAS 34 requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses on a year to date basis. Actual results may differ from these estimates.

The interim financial report contains condensed consolidated financial statements and selected explanatory notes. The condensed consolidated financial statements for the six months ended 30 June 2017 comprise Overseas Chinese Town (Asia) Holdings Limited (the “Company”) and its subsidiaries (collectively referred to as the “Group”) and the Group’s investments in associates and joint venture. The notes include an explanation of events and transactions that are significant to an understanding of the changes in financial position and performance of the Group since the 2016 annual financial statements. The condensed consolidated financial statements and notes thereon do not include all of the information required for full set of financial statements prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRSs”) issued by the HKICPA. HKFRSs include all Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards and Interpretations.

The interim financial report has been prepared in accordance with the same accounting policies adopted in the 2016 annual financial statements.

The interim financial report is unaudited and not reviewed by the auditor, but has been reviewed by the Audit Committee of the Company.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 31

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

2. ADOPTION OF NEW AND REvISED HONg KONg FINANCIAL REPORTINg STANDARDS

In the current period, the Group has adopted all the new and revised HKFRSs issued by the HKICPA that are relevant to its operations and effective for its accounting year beginning on 1 January 2017. The adoption of these new and revised HKFRSs did not result in significant changes to the Group’s accounting policies, presentation of the Group’s financial statements and the amounts reported for the current period and prior years.

The Group has not applied the new HKFRSs that have been issued but are not yet effective. The Group has already commenced an assessment of the impact of these new HKFRSs but is not yet in a position to state whether these new HKFRSs would have a material impact on its results of operations and financial position. The Group does not plan to adopt these standards prior to their mandatory effective date.

3. FAIR vALuE MEASuREMENTS

Except for unlisted equity securities, investment funds and financial products in the PRC under other financial assets were stated at cost, the carrying amounts of the Group’s financial assets and financial liabilities as reflected in the condensed consolidated statement of financial position approximate their respective fair values.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following disclosures of fair value measurements use a fair value hierarchy that categorises into three levels the inputs to valuation techniques used to measure fair value:

Level	1	inputs:	quoted prices (unadjusted) in active markets for identical assets
			or liabilities that the Group can access at the measurement
			date.

Level	2	inputs:	inputs other than quoted prices included within level 1 that are
			observable for the asset or liability, either directly or indirectly.
Level	3	inputs:	unobservable inputs for the asset or liability.

The Group’s policy is to recognise transfers into and transfers out of any of the three levels as of the date of the event or change in circumstances that caused the transfer.

32

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

3. FAIR vALuE MEASuREMENTS (continued)

Disclosures of level in fair value hierarchy at 30 June 2017:

Description Recurring fair value measurements: Available-for-sale financial assets under other financial assets Listed equity securities Total recurring fair value measurements Description Recurring fair value measurements: Available-for-sale financial assets under other financial assets Listed equity securities Total recurring fair value measurements	Fair value measurements as at 30 June 2017 Level 1 Level 2 Level 3 RMB’000 RMB’000 RMB’000 (unaudited)	Fair value measurements as at 30 June 2017 Level 1 Level 2 Level 3 RMB’000 RMB’000 RMB’000 (unaudited)	Fair value measurements as at 30 June 2017 Level 1 Level 2 Level 3 RMB’000 RMB’000 RMB’000 (unaudited)	Total 2017 RMB’000
	391,874 – – 391,874 – – Fair value measurements as at 31 December 2016 Level 1 Level 2 Level 3 RMB’000 RMB’000 RMB’000 (Audited)			391,874
				391,874
				Total 2016 RMB’000
	– –	– –	– –	–
				–

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 33

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

4. SEgMENT REPORTINg

(a) Information about reportable segments

Six months ended 30 June (unaudited): Revenue from external customers Inter-segment revenue Reportable segment revenue Reportable segment net profit/(loss) attributable to owners of the Company	Comprehensive development business 2017 2016 RMB’000 RMB’000 1,562,411 1,769,886 – – 1,562,411 1,769,886 37,250 213,114	Paper packaging business 2017 2016 RMB’000 RMB’000 380,061 367,476 – – 380,061 367,476 3,572 (1,548)	Total 2017 2016 RMB’000 RMB’000 1,942,472 2,137,362 – – 1,942,472 2,137,362 40,822 211,566	Total 2017 2016 RMB’000 RMB’000 1,942,472 2,137,362 – – 1,942,472 2,137,362 40,822 211,566
				2,137,362 –
				2,137,362
				211,566

(b) Reconciliations of reportable segment profit or loss

Profit Reportable segment profit attributable to owners of the Company Elimination of inter-segment profits Reportable segment profit derived from Group’s external customers Consolidated net profit attributable to owners of the Company	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 40,822 211,566 – – 40,822 211,566 40,822 211,566	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 40,822 211,566 – – 40,822 211,566 40,822 211,566
		211,566 –
		211,566
		211,566

34 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

5. REvENuE

The principal activities of the Group are comprehensive development and paper packaging business.

Revenue represents the sales value of goods or services supplied to customers (net of value-added tax or business tax), including the sales of properties, rental income from investment properties, ticket sales from theme park and sales of paper carton and products.

Comprehensive development business Paper packaging business OTHER NET LOSSES Net losses on disposal of fixed assets Net exchange losses Others	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 1,562,411 1,769,886 380,061 367,476 1,942,472 2,137,362 Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) (13) (7) (3,855) (167) 140 (111) (3,728) (285)	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 1,562,411 1,769,886 380,061 367,476 1,942,472 2,137,362 Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) (13) (7) (3,855) (167) 140 (111) (3,728) (285)
		(7) (167) (111)
		(285)

6. OTHER NET LOSSES

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 35

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

7. PROFIT BEFORE TAX

The Group’s profit before tax is arrived at after charging/(crediting):

(a) Finance costs: Interest on bank and other loans Interest on related party loans Total borrowing costs wholly repayable within five years Amount capitalised (b) Other items: Interest income Amortisation of intangible assets Depreciation Impairment of goodwill Net impairment losses/(reversal of impairment losses) on trade and other receivables Net write off of inventories Rentals receivable from investment property less direct outgoings RMB39,224,000 (Six months ended 30 June 2016: RMB23,577,000)	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 86,121 82,999 75,614 144,241 161,735 227,240 (46,699) (100,031) 115,036 127,209 Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) (18,278) (17,873) 188 166 110,642 99,187 – 28,124 781 (9) 1,516 423 (20,750) (26,386)	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 86,121 82,999 75,614 144,241 161,735 227,240 (46,699) (100,031) 115,036 127,209 Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) (18,278) (17,873) 188 166 110,642 99,187 – 28,124 781 (9) 1,516 423 (20,750) (26,386)
		(17,873) 166 99,187 28,124 (9) 423 (26,386)

36 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

8. INCOME TAX EXPENSE

INCOME TAX EXPENSE
Current tax – People’s Republic of China (“PRC”) corporate income tax – PRC land appreciation tax Deferred tax Origination and reversal of temporary differences	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 105,528 108,314 41,645 75,407 147,173 183,721 (8,065) (17,060) 139,108 166,661
		108,314 75,407
		183,721
		(17,060)
		166,661

(i) Corporate income tax

Pursuant to the rules and regulations of the Cayman Islands and the British Virgin Islands, the Group is not subject to any income tax in the Cayman Islands and the British Virgin Islands during the period (six months ended 30 June 2016: RMB Nil).

No provision for Hong Kong Profits Tax has been made in the financial statements since the Group has sufficient tax losses brought forward to set off against current period’s assessable profit. No provision for Hong Kong Profits Tax is required since the Group has no assessable profit for the six months ended 30 June 2016.

Pursuant to the income tax rules and regulations of the PRC, taxation for PRC subsidiaries is charged at the appropriate current rates of taxation ruling in the relevant cities in the PRC at 25% (six months ended 30 June 2016: 25%).

Additionally, a 10% withholding tax is levied on dividends declared to foreign investors from the PRC effective from 1 January 2008. A lower withholding tax rate may be applied if there is a tax treaty arrangement between the PRC and jurisdiction of the foreign investors. According to the tax treaty between Hong Kong Special Administrative Region and the PRC for avoidance of double taxation and prevention of tax evasion, dividends declared from PRC subsidiaries to Hong Kong holding companies are subject to 5% withholding income tax from 1 January 2008 and onwards.

37

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

8. INCOME TAX EXPENSE (continued)

• (ii) PRC land appreciation tax

PRC land appreciation tax (“PRC LAT”) is levied at progressive rates ranging from 30% to 60% on the appreciation of land value, being the proceeds of sales of properties less deductible expenditures including lease charges of land use rights and all property development expenditures, which is included in the consolidated statements of profit or loss as income tax. The Group has estimated the tax provision for PRC LAT according to the requirements set forth in the relevant PRC tax laws and regulations. The actual PRC LAT liabilities are subject to the determination by the tax authorities upon completion of the property development projects and the tax authorities might disagree with the basis on which the provision for PRC LAT is calculated.

38 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

9. EARNINgS PER SHARE

The calculation of the basic and diluted earnings per share is based on the following:

Earnings Earnings attributable to ordinary equity holders for the purpose of calculating basic earnings per share Preference share dividends saving on conversion of convertible preference shares Earnings attributable to ordinary equity holders for the purpose of calculating diluted earnings per share Number of shares Weighted average number of ordinary shares for the purpose of calculating basic earnings per share Effect of dilutive potential ordinary shares arising from convertible preference shares Weighted average number of ordinary shares for the purpose of calculating diluted earnings per share	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 23,563 195,367 17,259 16,199 40,822 211,566 Six months ended 30 June 2017 2016 (unaudited) (unaudited) 652,366,000 652,366,000 96,000,000 96,000,000 748,366,000 748,366,000	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 23,563 195,367 17,259 16,199 40,822 211,566 Six months ended 30 June 2017 2016 (unaudited) (unaudited) 652,366,000 652,366,000 96,000,000 96,000,000 748,366,000 748,366,000
		652,366,000 96,000,000
		748,366,000

As the conversion of the Company’s convertible preference shares would be anti-dilutive, there was no dilutive potential ordinary shares for the Company’s convertible preference shares during the six months ended 30 June 2017 and 2016 respectively.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 39

Notes to the Condensed Consolidated Financial Statements

For the six months ended 30 June 2017

10. FIXED ASSETS

Acquisitions and disposals

During the six months ended 30 June 2017, the Group acquired items of fixed assets with a cost of RMB217,333,000 (six months ended 30 June 2016: RMB1,584,346,000).

Fixed assets with carrying value of RMB45,000 were disposed during the six months ended 30 June 2017 (six months ended 30 June 2016: RMB587,000), resulting in a loss on disposal of RMB13,000 (six months ended 30 June 2016: a loss on disposal of RMB7,000).

11. INvESTMENTS IN ASSOCIATES

11. INvESTMENTS IN ASSOCIATES
成都體育產業有限責任公司 (Chengdu Sports Industry Co., Ltd.) 西安華僑城實業有限公司 (Xi’an OCT Investment Ltd.) 北京廣盈房地產開發有限公司 (Beijing Guangying Residential Property Development Limited) 成都文化旅遊發展股份有限公司 (Chengdu Culture & Tourism Development Company Limited) 12. INvESTMENT IN A JOINT vENTuRE 成都保鑫泉盛房地產開發有限公司 (Chengdu Baoxin Quansheng Real Estate Development Company Limited)	At 30 June 2017 RMB’000 (unaudited) 800,275 70,850 50,695 267,195 1,189,015 At 30 June 2017 RMB’000 (unaudited) 15,981	At 31 December 2016 RMB’000 (audited)
		801,384 80,072 501,593 251,115
		1,634,164
		At 31 December 2016 RMB’000 (audited)
		19,544

40 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

13. INvENTORIES

During the six months ended 30 June 2017, there was a write-down of inventories of RMB1,820,000 and reversal of RMB304,000 in profit or loss (six months ended 30 June 2016: RMB865,000 was written down and reversal of RMB442,000 in profit or loss). The reversal arose due to an increase of the estimated net realisable value of certain goods as a result of changes in customer preference.

14. TRADE AND OTHER RECEIvABLES

Included in trade and other receivables are trade debtors and bills receivables (net of allowance of doubtful debts) with the following ageing analysis as of the end of the reporting period:

Current Less than 3 months past due 3 to 12 months past due More than 12 months past due	At 30 June 2017 RMB’000 (unaudited) 288,038 12,980 1,858 913 303,789	At 31 December 2016 RMB’000 (audited)
		282,219 9,063 970 436
		292,688

The Group normally allows a credit period ranging from 60 days to 120 days to its customers from the date of billing. Subject to negotiation, extended credit terms are available for certain customers with established trading records.

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 41

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

15. CASH AND CASH EQuIvALENTS

CASH AND CASH EQuIvALENTS
Cash at banks and in hand Cash at banks restricted for secure the issuance of bills payable	At 30 June 2017 RMB’000 (unaudited) 3,150,439 24,381 3,174,820	At 31 December 2016 RMB’000 (audited)
		2,056,017 21,741
		2,077,758

16. TRADE AND OTHER PAYABLES

Included in trade and other payables are trade creditors and bills payable with the following ageing analysis as of the end of the reporting period:

Due within 3 months or on demand Over 3 months but less than 12 months	At 30 June 2017 RMB’000 (unaudited) 436,186 902 437,088	At 31 December 2016 RMB’000 (audited)
		633,374 –
		633,374

42 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements

For the six months ended 30 June 2017

17. RESERvES AND DIvIDENDS

(a) Dividends

Dividends attributable to the previous financial year, approved and paid during the interim period:

Final dividend in respect of the financial year ended 31 December 2016, approved and paid during the interim period, of HK16.00 cents per ordinary share (equivalent RMB13.89 cents per ordinary share) (year ended 31 December 2015: HK14.00 cents per ordinary share (equivalent RMB11.86 cents per ordinary share)) Final dividend in respect of the financial year ended 31 December 2016, approved and paid during the interim period, of HK20.25 cents per convertible preference share (equivalent RMB17.98 cents per convertible preference share) (year ended 31 December 2015: HK20.25 cents per convertible preference share (equivalent RMB16.87 cents per convertible preference share))	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 90,590 77,348 17,259 16,199 107,849 93,547	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 90,590 77,348 17,259 16,199 107,849 93,547
		77,348 16,199
		93,547

The Directors do not propose the payment of an interim dividend for the six months ended 30 June 2017 (six months ended 30 June 2016: RMB Nil).

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 43

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

17. RESERvES AND DIvIDENDS (continued)

(b) Transfer to reserve

Transfers from retained earnings to general reserve fund were made in accordance with the relevant PRC rules and regulations and the articles of association of the Company’s subsidiaries incorporated in the PRC and were approved by the respective boards of directors.

The subsidiaries in the PRC are required to transfer 10% of their net profits, as determined in accordance with the PRC accounting rules and regulations, to general reserve fund until the reserve balance reaches 50% of the registered capital. The transfer to this fund must be made before distribution of dividends to the owners.

General reserve fund can be used to make good previous years’ losses, if any, and may be converted into paid up capital provided that the balance of the general reserve fund after such conversion is not less than 25% of the registered capital.

18. COMMITMENTS

• (a) Capital commitments contracted for at the end of the reporting period but not yet incurred are as follows:

but not yet incurred are as follows:
Contracted but not provided for	At 30 June 2017 RMB’000 (unaudited) 1,335,804	At 31 December 2016 RMB’000 (audited)
		1,353,303

The capital and other commitments in 2017 and 2016 mainly represented the commitments in connection with the planned development projects of 成都天府華僑城實業發展有限公司 (Chengdu Tianfu OCT Industry Development Company Limited)、華僑城（上海）置地有限公司 (OCT Shanghai Land) and 重慶華僑城置地有限公司 (Chongqing OCT Real Estate Limited).

44 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

18. COMMITMENTS (continued)

• (b) Lease commitments

The Group as lessee

At 30 June 2017, the total future minimum lease payments under noncancellable operating leases in respect of land and properties were payable as follows:

Within one year After one year but within five years After five years	At 30 June 2017 RMB’000 (unaudited) 6,956 19,707 529 27,192	At 31 December 2016 RMB’000 (audited)
		10,481 16,134 741
		27,356

The Group leases a number or land and properties under operating leases. The leases run for period from one to twenty-six years and certain leases have an option to renew at which time all the terms are renegotiated. None of the leases includes contingent rental.

The Group as lessor

All of the Group’s investment properties are held for rental purposes. All of the properties held have committed tenants for the next 1 to 3 years.

At 30 June 2017, the total future minimum lease payments under noncancellable operating leases are receivable for commercial properties in Hong Kong and Xi’an as follows:

Within one year In the second to fifth years inclusive	At 30 June 2017 RMB’000 (unaudited) 67,200 72,000 139,200	At 31 December 2016 RMB’000 (audited)
		54,965 44,676
		99,641

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017 45

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

19. MATERIAL RELATED PARTY TRANSACTIONS

• (a) Transactions with other state-controlled entities:

The Company is a state-controlled entity and operates in an economic regime currently dominated by entities directly or indirectly controlled by the PRC government (“state-controlled entities”) through its government authorities, agencies, affiliations and other organisations.

Transactions with other state-controlled entities include but are not limited to the following:

• Purchase of services;

• Utility supplies; and

• Financial services arrangement.

These transactions are conducted in the ordinary course of the Group’s business on terms comparable to those with other entities that are not state-controlled. The Group has established its buying, pricing strategy and approval process for purchases and sales of products and services. Such buying, pricing strategy and approval processes do not depend on whether the counterparties are state-controlled entities or not.

Having considered the potential for transactions to be impacted by related party relationships, the Group’s pricing strategy, buying and approval processes, and what information would be necessary for an understanding of the potential effect of the relationship on the financial statements, the directors are of the opinion that the following transactions with other statecontrolled entities require disclosure:

46 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

19. MATERIAL RELATED PARTY TRANSACTIONS (continued)

• (a) Transactions with other state-controlled entities: (continued)

• (i) Transactions and balances with other state-controlled banks in the PRC:

Interest income Interest expenses Cash at banks Bank loans	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 5,978 5,740 41,878 36,458 At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) 2,221,889 1,133,079 3,530,576 2,682,395	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 5,978 5,740 41,878 36,458 At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) 2,221,889 1,133,079 3,530,576 2,682,395
		5,740 36,458
		At 31 December 2016 RMB’000 (audited)
		1,133,079 2,682,395

(ii) Transactions and balances with other state-controlled entities in the PRC:

Sales of products Purchase of services Trade and other receivables Trade and other payables	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 14,096 10,402 231,572 218,368 At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) 13,536 20,430 19,224 63,938	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 14,096 10,402 231,572 218,368 At 30 June At 31 December 2017 2016 RMB’000 RMB’000 (unaudited) (audited) 13,536 20,430 19,224 63,938
		10,402 218,368
		At 31 December 2016 RMB’000 (audited)
		20,430 63,938

For the six months ended 30 June 2017 and 2016 the Group’s significant transactions with other state-controlled entities being purchases of services for the development of comprehensive development business.

47

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

19. MATERIAL RELATED PARTY TRANSACTIONS (continued)

• (b) The group has a related party relationship with the following parties:

Name of party 華僑城集團公司(Overseas Chinese Town Enterprises Corporation) (“OCT Group”) 深圳華僑城股份有限公司(Shenzhen Overseas Chinese Town Company Limited) Overseas Chinese Town (HK) Company Limited Konka Group Company Limited, its subsidiaries and associates Shenzhen Overseas Chinese Town Water and Electricity Co., Ltd. Shenzhen Overseas Chinese Town Property Services Co., Ltd. Shenzhen Overseas Chinese Town Creative Culture Hotel Co., Ltd. Shenzhen Overseas Chinese Town International Media and Performance Co., Ltd. Overseas Chinese Town Culture Tourism and Technology Co., Ltd Shenzhen OCT Hake Culture Company Limited Shenzhen Overseas Chinese Town Entertainment Investment Company Limited

Relationship with the group

Ultimate parent Intermediate parent Intermediate parent Fellow subsidiary Fellow subsidiary Fellow subsidiary Fellow subsidiary Fellow subsidiary Fellow subsidiary Fellow subsidiary Fellow subsidiary

48 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements

For the six months ended 30 June 2017

19. MATERIAL RELATED PARTY TRANSACTIONS (continued)

• (b) The group has a related party relationship with the following parties: (continued)

Recurring transactions

Recurring transactions
Sales of goods to: OCT Group, its subsidiaries and associates Interest expenses and related charges paid to: OCT Group, its subsidiaries and associates Rental received from: OCT Group, its subsidiaries and associates Rental paid (including management fee) to: OCT Group, its subsidiaries and associates Purchase of service (including entertainment facilities and service) from: OCT Group, its subsidiaries and associates	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 30,756 21,000 75,614 144,241 912 1,360 1,815 1,669 4,135 14,467
		21,000
		144,241
		1,360
		1,669
		14,467

The directors of the Company are of the opinion that those transactions with related parties were conducted in the ordinary course of business, on normal commercial terms and in accordance with the agreements governing such transactions.

49

OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

19. MATERIAL RELATED PARTY TRANSACTIONS (continued)

• (b) The group has a related party relationship with the following parties: (continued)

Balance with related parties

Amounts due from/(to) related parties are as follows:

Notes Trade receivable from fellow subsidiaries (i) Trade payable to fellow subsidiaries (ii) Other receivables from associates (iii) Other receivables from an intermediate parent and fellow subsidiaries (iv) Other payables to ultimate parent (iv) Other payables to associates (iv) Other payable to intermediate parents and fellow subsidiaries (iv) Loans from a fellow subsidiary (v) Loans from intermediate parents (vi)	At 30 June 2017 RMB’000 (unaudited) 35,687 (2,829) 4,297 13,010 (4) (132,245) (520,111) (1,265,700) (2,859,574)	At 31 December 2016 RMB’000 (audited)
		29,366 (5,382) 18,489 3,803 (4) (759,169) (310,273) (1,265,700) (3,326,648)

Notes:

• (i) The trade receivable balances are unsecured, non-interest bearing and are expected to be recovered within six months. These refer to receivables in respect of sales of paper cartons and paper boxes to related parties.

• (ii) The trade payable balances are unsecured, non-interest bearing and are expected to be settled within three months. These refer to payables in respect of purchases of raw material from related parties.

• (iii) Other receivables from associates are unsecured, non-interest bearing, and repayable on demand.

• (iv) Other receivables and payables from/to ultimate parent, intermediate parents and fellow subsidiaries, and other payables to associates are unsecured, non-interest bearing, and repayable on demand.

50 OVERSEAS CHINESE TOWN (ASIA) HOLDINGS LIMITED Interim Report 2017

Notes to the Condensed Consolidated Financial Statements For the six months ended 30 June 2017

19. MATERIAL RELATED PARTY TRANSACTIONS (continued)

• (b) The group has a related party relationship with the following parties: (continued)

Balance with related parties (continued)

Notes: (continued)

• (v) Loans from a fellow subsidiary of RMB1,265,700,000 is bearing an interest at 4.275%.

• (vi) Loans from intermediate parents of USD17,140,000 is bearing an interest at 2.5%, HK$331,132,000 is bearing at 2.5%, HK$100,000,000 is bearing at 2.1%, HK$1,800,000,000 is bearing at 2.3%, RMB111,111,000 is bearing at 3% and RMB200,000,000 is bearing at 5.225%; RMB62,000,000 and HK$500,000,000 are noninterest bearing.

• (c) Key management personnel compensations

Key management personnel receive compensations in the form of fees, salaries, housing and other allowances, benefits in kind, discretionary bonuses, share options and retirement scheme contribution.

Total compensation of the Group received by key management personnel, including amounts paid to the Company’s directors and certain of the highest paid employees, is summarised as follows:

Short-term employee benefits Post employment benefits	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 4,259 2,956 402 490 4,661 3,446	Six months ended 30 June 2017 2016 RMB’000 RMB’000 (unaudited) (unaudited) 4,259 2,956 402 490 4,661 3,446
		2,956 490
		3,446

20. EvENTS AFTER THE REPORTINg PERIOD

On 7 July 2017, the Group intends to dispose of its 100% equity interest in Shanghai Huali Packaging Co., Ltd. (上海華勵包裝有限公司), and indirect whollyowned subsidiary of the Group, through the public tender to be conducted on the Shanghai United Assets and Equity Exchange. The announcements related to the transaction have been published by the Group on 7 July 2017 and 4 August 2017.