RoboSense Technology Co., Ltd — Interim / Quarterly Report 2016

Oct 27, 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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THIRD QUARTERLY REPORT 2016

I. IMPORTANT NOTICE

• 1.1 The board of directors (the “Board”), the supervisory committee, the directors (the “Directors”), supervisors and senior management members of the Company shall warrant that the information contained in this quarterly report is true, accurate, and complete without any false and misleading statements or material omissions, and severally and jointly accept legal responsibility for the above.

• 1.2 All Directors attended the Board meeting to consider this quarterly report of the Company.

• 1.3 Zhang Chong, Person-in-charge of the Company, Ma Yan, Person-in-charge of accounting, and Chen Jing, Person-in-charge of accounting institution(head of accounting department), warrant that the financial statements in this quarterly report are true, accurate and complete.

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

* For identification purposes only

– 1 –

II. MAJOR FINANCIAL DATA AND CHANGES IN SHAREHOLDERS OF THE COMPANY

2.1 Major Financial Data

Unit: yuan Currency: RMB

				Increase/decrease
				at the end of
				the reporting
				period as
	At the end of	At the	end of	compared with
	the reporting	the previous year		the end of
	period	After adjustment	Before adjustment	the previous year
				(%)
Total assets	1,285,890,663.06	1,314,035,081.52	1,314,035,081.52	-2.14
Net assets attributable to shareholders
of the Company	416,925,039.80	278,344,996.00	278,344,996.00	49.79
	From beginning
	of the year	From beginning of the previous
	to the end of	year to the end	of the reporting
	the reporting	period of the	previous year
	period (January–	(January–September)		Year-on-year
	September)	After adjustment	Before adjustment	increase/decrease
				(%)
Net cash flows from operating activities	-92,860,892.88	-113,823,422.83	-89,069,803.49	N/A
	From beginning
	of the year	From beginning of the previous
	to the end of	year to the end	of the reporting
	the reporting	period of the	previous year
	period (January–	(January–September)		Year-on-year
	September)	After adjustment	Before adjustment	increase/decrease
				(%)
Operating income	209,125,577.79	492,128,562.87	402,539,580.92	-57.51
Net profit attributable to shareholders
of the listed company	-71,044,940.50	-145,785,402.27	-155,016,545.65	N/A
Net profit attributable to shareholders
of the listed company after deducting
extraordinary profit or loss	-73,486,273.85	-153,848,826.53	-153,848,826.53	N/A
Weighted average return on				Increased by 6.08
net assets_(%)_	-16.55	-22.63	N/A	percentage points
Basic earnings per share_(RMB/share)_	-0.1352	-0.2831	-0.3100	N/A
Diluted earnings per share_(RMB/share)_	-0.1352	-0.2831	-0.3100	N/A

– 2 –

Explanations on the Major Financial Data and Financial Indicators of the Company

Retrospective adjustments were made to Bengbu CNBM Information Display Material Co., Ltd. (蚌埠中建材信息顯示材料有限公司) in respect of business combination under common control for the same period last year.

Extraordinary Items and Amounts

Unit:yuan Currency: RMB

Extraordinary Items Profit or loss from disposal of non-current assets Government grants credited to current profit or loss (except for those which are closely related to the Company’s ordinary business, in accordance with national policies and continuously received in certain standard amounts and quantities) Profit or loss from debt restructuring Other non-operating income and expenses excluding the aforesaid items Effect of income tax Total	Amount for the reporting period (July– September) 311,187.93 1,256,440.48 400,089.26 -2,634,655.73 -212,637.76 -879,575.82	Amounts for the period from beginning of the year to the end of the reporting period (January– September) Explanation 311,282.96 5,550,527.17 402,135.50 -2,742,584.30 -1,080,027.98 2,441,333.35

– 3 –

2.2 Total number of shareholders, top 10 shareholders and top 10 holders of tradable shares (or shares not subject to trading moratorium) at the end of the reporting period

Unit: Share

Total number of shareholders

57,582, including 57,533 holders of A Shares and 49 holders of H Shares

Shareholdings of the top 10 shareholders

			Number of
	Total number of		shares subject
	shares held as		to trading	Pledged or frozen
	at the end of the	Shareholding	moratorium	Status of		Nature of
Name of shareholders (full name)	reporting period	percentage	held	shares	Number	shareholder
		(%)
HKSCC NOMINEES LIMITED	248,660,699	47.21	0	Unknown		Overseas
						legal person
China Luoyang Float Glass (Group)	174,018,242	33.04	15,000,000	Pledged	41,000,000	State-owned legal
Company Limited						person
Caitong Fund – Ping An Bank – Tianrun	1,962,130	0.37	1,962,130	Unknown		Unknown
Capital Management (Beijing) Co., Ltd. (財通基金－平安銀行－天潤資本管理
（北京）有限公司)
Agricultural Bank of China Limited –	1,464,200	0.28	0	Unknown		Unknown
Fullgoal CSI State-owned Enterprises Reform Index Classified 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)
First Capital Securities Co., Ltd. – Guosen	1,202,185	0.23	1,202,185	Unknown		Unknown
Securities – Gongying Dayan Quantified
Private Placement Assembled Asset
Management Plan (第一創業證券－國信 證券－共盈大岩量化定增集合資產管理
計劃)
Liu Bibo (劉碧波)	1,000,000	0.19	0	Unknown		Domestic
						natural person
Caitong Fund – ICBC – Qiaogeli Blue Chip	981,065	0.19	981,065	Unknown		Unknown
Selection No. 2 Assets Management Plan (財通基金－工商銀行－喬格理藍籌精 選2號資產管理計劃)
Pu Lulu (蒲露露)	832,090	0.16	0	Unknown		Domestic natural
						person
Zhang Lixin (張立新)	800,000	0.15	0	Unknown		Domestic natural
						person
Caitong Fund – Ping An Bank – Shanghai	735,799	0.14	735,799	Unknown		Unknown
Goldstate Brilliance Asset Management Co., Ltd. (財通基金－平安銀行－上海 金元百利資產管理有限公司)

– 4 –

Particulars of the top 10 shareholders not subject to trading Moratorium

	Number of circulating
	shares not subject to
	trading moratorium
	as at the end of the
Name of shareholders	reporting period	Class and number of shares
		Class	Number
HKSCC NOMINEES LIMITED	248,660,699	Overseas listed	248,660,699
		foreign shares
China Luoyang Float Glass (Group) Company	159,018,242	Ordinary shares	159,018,242
Limited		denominated in RMB
Agricultural Bank of China Limited – Fullgoal CSI	1,464,200	Ordinary shares	1,464,200
State-owned Enterprises Reform Index Classified 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) Liu Bibo (劉碧波)	1,000,000	mdenominated in RMB Ordinary shares	1,000,000
		denominated in RMB
Pu Lulu (蒲露露)	832,090	Ordinary shares	832,090
		denominated in RMB
Zhang Lixin (張立新)	800,000	Ordinary shares	800,000
		denominated in RMB
Hong Kong Securities Clearing Company Limited	517,913	Ordinary shares	517,913
		denominated in RMB
CHUK YEE MEN LIZA	374,000	Overseas listed	374,000
Boshi Value Growth Securities Investment Fund (博 時價值增長證券投資基金) Jin Ruiming (金瑞明)	335,500 315,394	foreign shares Ordinary shares denominated in RMB Ordinary shares	335,500 315,394
		denominated in RMB

Explanation on connected relationship or action acting in concert among the aforesaid shareholders

There are no connected parties or persons acting in concert as defined by Regulations for Disclosure of Changes in Shareholding of Listed Companies （《上市公司股東持股變動信息披露管理辦法》） issued by CSRC among the top ten shareholders of the Company, including China Luoyang Float Glass (Group) Company Limited and other shareholders of circulating shares. The Company is not aware of any parties acting in concert or any connected relationship among other shareholders of circulating shares.

Explanations on preference shareholders with voting None. rights restored and the number of shares held

Note:

1. Shares held by HKSCC NOMINEES LIMITED are held on behalf of various Customers.

2. The ordinary shares dominated in Renminbi held by Hong Kong Securities Clearing Company Limited are held on behalf of overseas investors who held these shares via Northbound Trading in the Shanghai-Hong Kong Stock Connect.

3. On 17 October 2016, CLFG and Bengbu Institute have completed the registration procedures with China Securities Depository and Clearing Corporation Limited Shanghai Branch. CLFG transferred 69,000,000 shares of the Company (accounting for 13.10% of the total share capital of the Company) held by it to Bengbu Institute. As of the date of this Report, CLFG holds 105,018,242 shares of the Company.

– 5 –

III. SIGNIFICANT EVENTS

3.1 Details and reasons for material changes in the major financial statement items and financial indicators of the Company

	Amount at	Amount at
	the end of	the beginning
Item	the period	of the period	Changes	Explanation
			(%)
Construction in		9,828,822.54	-100.00	Transfer of denitrification
progress				engineering and others
				into fixed assets in the
				reporting period
Deferred income	2,421,430.12	4,091,374.33	-40.82	Impairment losses from
tax assets				written off the assets in
				the reporting period
Tax payables	4,721,932.82	14,961,097.35	-68.44	Payment of tax payable for
				the previous period in the
				reporting period
Other payables	101,500,514.69	166,587,026.05	-39.07	Payment of consideration
				payable to CLFG for
				the asset restructuring
				last year in the reporting
				period
Non-current	446,716,851.66	81,097,651.66	450.84	Reclassification of the
liabilities due				long-term loans due
within one year				within one year into non-
				current liabilities due
				within one year in the
				reporting period
Long-term loans	32,955,619.02	459,170,134.47	-92.82	Reclassification of the
				long-term loans due
				within one year into non-
				current liabilities due
				within one year in the
				reporting period

– 6 –

	Amount from
	the beginning
	of the year	Amount for
	to the end of	the same
	the reporting	period
Item	period	last year	Changes	Explanation
			(%)
Operating revenue	209,125,577.79	492,128,562.87	-57.51	mainly due to the change in
				consolidation scope during
				the reporting period, which
				did not include operating
				revenue from the companies
				exchanged out from the
				beginning of the year to the
				reporting period
Operating costs	218,146,294.10	505,127,696.43	-56.81	mainly due to the change in
				consolidation scope during
				the reporting period, which
				did not include operating
				costs from the companies
				exchanged out from the
				beginning of the year to the
				reporting period
Business taxes and	1,612,158.36	3,267,049.62	-50.65	mainly due to the year-on-
surcharges				year decrease in revenue
				from the beginning of the
				year to the reporting period
				which resulted in decrease in
				relevant taxes accordingly
Selling expenses	5,369,499.42	23,313,031.63	-76.97	mainly due to the exclusion
				of costs of the companies
				exchanged out from the
				beginning of the year to the
				reporting period
Administration	48,535,045.69	82,527,617.83	-41.19	mainly due to the exclusion
expenses				of costs of the companies
				exchanged out from the
				beginning of the year to the
				reporting period
Impairment losses of	221,998.08	21,836,838.21	-98.98	mainly due to the inclusion of
assets				the provision for depreciation
				of inventories for the
				companies exchanged out in
				the impairment loss on assets
				for the same period of last
				year
Non-operating income	6,289,565.87	2,356,512.34	166.90	mainly due to the increase in
				government subsidy from the
				beginning of the year to the
				end of the reporting period

– 7 –

	Amount from
	the beginning
	of the year	Amount for
	to the end of	the same
	the reporting	period
Item	period	last year	Changes	Explanation
			(%)
Income tax expenses	3,973,673.03	2,956,698.20	34.40	mainly due to the year-on-year
				increase of total profit of the
				profit-making companies
				from the beginning of
				the year to the end of the
				reporting period
Net cash flows from	-92,860,892.88	-113,823,422.83	N/A	mainly due to the decrease in
operating activities				the taxes and fees paid from
				the beginning of the year
				to the end of the reporting
				period
Net cash flow	-91,006,656.29	-12,341,288.32	N/A	mainly due to the payment
from investment				of consideration payable
activities				to CLFG for the asset
				restructuring from the
				beginning of the year to the
				end of the reporting period
Net cash flow from	166,982,573.07	101,229,947.26	64.95	mainly due to the receipt of
financing activities				proceeds from non-public
				issuance of shares from the
				beginning of the year to the
				end of the reporting period

• 3.2 Analysis and explanation of progress and impact of significant events and their solutions

Since the Company was in the process of planning a significant asset restructuring event, upon application, trading in the Company’s A shares was suspended from 8 September 2016. According to the progress of the significant asset restructuring event, the Company issued Announcement in respect of Suspension of Trading in A shares in relation to a Significant Assets Restructuring of Luoyang Glass Company Limited《洛陽玻璃股份 有限公司關於重大資產重組A股停牌公告》, Announcement in respect of Suspension of Trading in A Shares in relation to a Potential Significant Assets Restructuring of Luoyang Glass Company Limited《洛陽玻璃股份有限公 司關於潛在重大資產重組A股停牌公告》and Announcement in respect of Continuation of Suspension of Trading in A Shares in relation to Significant Assets Restructuring of Luoyang Glass Company Limited*《洛陽玻璃股份 有限公司關於重大資產重組A股股票繼續停牌的公告》on 23 September 2016, 30 September 2016, 20 October 2016, respectively. At present, the Company and the related parties are advancing the related work of the significant asset restructuring program in an orderly manner .

– 8 –

• 3.3 Performance of undertakings of the Company and shareholders holding 5% or more of the Company’s shares

• During the transfer of relevant equity interests, CNBMG undertook on 11 September 2007 that: CNBMG (including its existing controlled enterprises) would not directly or indirectly involve in any businesses which constitute competition with the Company. Should any business opportunities enabling CNBMG to engage in or take part in any business operations that might constitute competition with those of the Company arise, it would notify the Company of the same. Save as a financial investor, CNBMG would not invest in any businesses which may constitute competition with the operations of the Company, and would take measures to prevent the possibility of substantial competition when continuing to acquire other businesses which have horizontal competition with the Company directly or indirectly under appropriate conditions. In case of violation of the above undertakings, CNBMG would fully indemnify the Company for any loss so caused.

Until the end of the Reporting Period, CNBMG honored its undertaking.

1. CNBMG undertook on 11 September 2007 when conducting allocation of relevant equity that CNBMG and its controlled enterprises will try its best to avoid and reduce the connected transactions with the Company. For the connected transactions inevitable or due to reasonable reasons, it will comply with principles of market impartiality, fairness and openness, and enter into agreements according to laws, perform legal procedures, perform information disclosure obligation and conduct relevant reporting and approving procedures in accordance with relevant requirements, and warrants not to prejudice the legal interests of the Company and other shareholders through connected transactions.

As of the end of the Reporting Period, CNBMG honored its undertaking.

– 9 –

1. During transfer of relevant equity interests, Triumph Group undertook on 9 December 2010 that: Triumph Group and its controlled enterprises would not directly or indirectly involve in any businesses or activities in competition with the principal operations of the Company, by any means (including but not limited to the independent business, joint venture or having shares or interest in another company or enterprise). In the event that the business opportunities obtained by Triumph Group or its controlled enterprises would or might compete with the principal operations of the Company, it would notify the Company as soon as possible and pass such business opportunities to the Company to ensure that there is no prejudice to the interests of the shareholders of the Company as a whole.

As of the end of the Reporting Period, Triumph Group honored its undertaking.

1. On 31 December 2014, CLFG and CNBMG committed at the time of material asset restructuring not to directly participate in any business same as or similar to main business of the Company or any subsidiary after the completion of asset restructuring, and that they would cause enterprises that are directly or indirectly controlled by them not to directly or indirectly participate in any business or activity that competes with or may compete with main business of the Company or its wholly-owned or directly/indirectly controlled subsidiary in the commercial field. In case that CLFG and CNBMG or their directly or indirectly controlled enterprises participate in or have the opportunity to participate in any business that competes with or may compete with main business of the Company or any of its subsidiaries, CLFG and CNBMG shall abandon or cause their directly or indirectly controlled enterprises to abandon the business or opportunity of business that may be competitive, or facilitate to offer the business or opportunity of business to the Company or its wholly-owned or controlled subsidiary on fair and reasonable terms, or transfer the business or opportunity of business to any other assisting parties that are not connected.

As of the end of the Reporting Period, CLFG and CNBMG honored their undertaking.

– 10 –

1. On 31 December 2014, CLFG and CNBMG committed at the time of material asset restructuring to avoid or minimize connected transactions concluded between them and any other enterprises under their actual control or material influence and the Company following this transaction. Any inevitable connected business or transaction should be concluded on the transaction principles of openness, fairness and equity and at fair and reasonable market prices. In addition, the decision-making procedure for connected transaction should be in accordance with relevant laws, regulations, regulatory documents and Articles of Associations of the listed company, and the obligation for information disclosure should be fulfilled as required. CLFG and CNBMG committed not to transfer their own interests in the Company through connected transactions, nor to cause damage to legal rights of the listed company and other shareholders via influencing businessmaking processes of their own companies.

As of the end of the Reporting Period, CLFG and CNBMG honored their undertaking.

1. On 31 December 2014, CLFG committed at the time of material asset restructuring not to transfer the shares obtained through the restructuring within 36 months upon completion of the share issuance.

As of the end of the Reporting Period, CLFG honored its undertaking.

1. On 2 November 2015, CLFG committed at the time of material asset restructuring not to transfer the shares of Luoyang Glass held by it before the transaction within 12 month after the transaction was concluded. Where the shares increase as the result of bonus issue or conversion to share capital, the increased shares of Luoyang Glass would also be locked up for a 12-month period mentioned above. However, the transfer of the shares of Luoyang Glass held by CLFG between different entities under actual control of the same controller would not be subject to the limitation of 12-month period, provided that CLFG should cause the transferee to abide by aforesaid commitment on locking-up.

As of the end of the Reporting Period, CLFG honored its undertaking.

– 11 –

1. On 2 November 2015, Bengbu Institute and China Triumph International Engineering Co., Ltd (CTIEC) made the following commitments at the time of material asset restructuring regarding 16 patent rights jointly owned by themselves and Bengbu Company: 1. being joint owners of aforesaid 16 patent rights, Bengbu Institute and CTIEC would not use these patent rights in any form within the valid period of the patent rights. Without the approval of Bengbu Company, Bengbu Institute and CTIEC would have no right to transfer or dispose the aforesaid 16 patent rights to any other assisting parties, or permit any other assisting parties to use these patent rights. 2. Bengbu Company had the right to independently exercise the jointly owned rights, and all incomes incurred therefrom should be independently owned by Bengbu Company. 3. In case that Bengbu Institute and CTIEC violated aforesaid commitments, they should undertake corresponding legal responsibilities and make compensation to the party with damaged legal rights.

As of the end of the Reporting Period, Bengbu Institute and CTIEC honored their undertaking.

1. On 2 November 2015, CLFG committed at the time of material asset restructuring that, as a party to the transaction, it intended to make compensation to Bengbu Company in case that actual net profit is less than expected net profit in Asset Appraisal Report during 2015–2017.

As of the end of the Reporting Period, CLFG honored its undertaking.

• 3.4 The warning of projection on cumulative net profit for the period from the beginning of the year to the end of the next reporting period to be at a loss or expected to have material changes as compared to the corresponding period of prior year and its explanation

Not applicable

– 12 –

IV. APPENDIX

4.1 Financial Statements

Consolidated Balance Sheet

30 September 2016

Prepared by: Luoyang Glass Company Limited

Unit: yuan Currency: RMB Type of audit: unaudited

Item Current assets: Bank balance and cash Notes receivable Accounts receivable Prepayments Other receivables Inventory Assets classified as held-for-sale Non-current assets due within one year Other current assets Total current assets	Balance as at the end of the period 70,458,060.51 22,065,978.08 80,800,063.18 3,687,020.58 29,812,315.28 227,040,923.31 54,364,354.31 488,228,715.25	Balance as at the beginning of the year 102,342,860.91 25,230,005.90 71,678,942.58 4,329,899.13 28,928,810.44 195,863,112.95 58,978,537.93 487,352,169.84

– 13 –

Item Non-current assets: Long-term receivables Long-term equity investment Investment properties Fixed assets Construction in progress Construction materials Disposal of fixed assets Intangible assets Development expense Long-term deferred expenses Deferred income tax assets Other non-current assets Total non-current assets Total assets Current liabilities: Short-term loans Notes payable Accounts payable Payments received in advance Staff remuneration payables Taxes payable Interests payable Dividends payable Other payables Non-current liabilities due within one year Other current liabilities Total current liabilities	Balance as at the end of the period 54,162,969.20 662,929,617.19 63,111,734.69 11,595,769.95 3,440,426.66 2,421,430.12 797,661,947.81 1,285,890,663.06 70,000,000.00 90,000,000.00 71,776,504.97 22,760,073.45 19,820,497.69 4,721,932.82 101,500,514.69 446,716,851.66 827,296,375.28	Balance as at the beginning of the year 51,727,535.57 691,522,403.10 9,828,822.54 64,517,450.10 4,995,326.04 4,091,374.33 826,682,911.68 1,314,035,081.52 67,930,000.00 110,200,000.00 80,295,143.32 20,132,927.79 26,291,242.89 14,961,097.35 166,587,026.05 81,097,651.66 567,495,089.06

– 14 –

		Balance as at	Balance as at
		the end of	the beginning of
Item		the period	the year
Non-current liabilities:
Long-term loans		32,955,619.02	459,170,134.47
Deferred income		8,713,628.96	9,024,861.99
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities		41,669,247.98	468,194,996.46
Total liabilities		868,965,623.26	1,035,690,085.52
Owners’ equity:
Share capital		526,766,875.00	515,018,242.00
Other equity instrument
including: preferred shares
perpetual bonds
Capital reserve		1,449,321,666.62	1,251,445,315.32
Less: treasury stock
Other comprehensive income
Special reserve
Surplus reserve		51,365,509.04	51,365,509.04
General risk provision
Retained earnings		-1,610,529,010.86	-1,539,484,070.36
Total equity attributable	to the equity
holders of the Company		416,925,039.80	278,344,996.00
Minority interests
Total owners’ equity		416,925,039.80	278,344,996.00
Total liabilities and owners’ equities		1,285,890,663.06	1,314,035,081.52
		Person in charge of
Legal representative:	Chief accountant:	accounting department:
Zhang Chong	Ma Yan	Chen Jing

– 15 –

Balance Sheet of the Company 30 September 2016

Prepared by: Luoyang Glass Company Limited

Unit: yuan Currency: RMB Type of audit: unaudited

Item Current assets: Bank balance and cash Notes receivable Accounts receivable Prepayments Interests receivable Dividends receivable Other receivables Inventories Other current assets Total current assets	Balance as at the end of the period 47,807,012.17 660,000.00 233,820,057.29 72,208.71 87,441,782.80 219,741.02 50,465.51 370,071,267.50	Balance as at the beginning of the year 60,422,236.77 12,298,525.67 209,998,506.36 204,646.95 92,782,775.21 375,706,690.96

– 16 –

Item Non-current assets: Financial assets available for sale Investments held to maturity Long-term receivables Long-term equity investments Investment properties Fixed assets Construction in progress Construction materials Disposal of fixed assets Intangible assets Development expense Long-term deferred expenses Deferred income tax assets Other non-current assets Total non-current assets Total assets	Balance as at the end of the period 54,162,969.20 748,986,593.99 2,979,635.69 6,766,704.24 297,000.00 813,192,903.12 1,183,264,170.62	Balance as at the beginning of the year 51,727,535.57 748,986,593.99 3,274,034.44 7,043,817.21 378,000.00 811,409,981.21 1,187,116,672.17

– 17 –

Item Current liabilities: Short-term borrowings Notes payable Accounts payable Payments received in advance Staff remuneration payables Taxes payable Other payables Liabilities classified as held-for-sale Non-current liabilities due within one year Other current liabilities Total current liabilities Non-current liabilities: Long-term loans Other non-current liabilities Total non-current liabilities Total liabilities	Balance as at the end of the period 90,000,000.00 37,295,237.55 19,326,348.08 5,840,077.71 185,802.61 192,808,588.43 397,172,547.08 742,628,601.46 1,025,550.44 1,025,550.44 743,654,151.90	Balance as at the beginning of the year 112,100,000.00 52,825,849.20 19,236,279.29 8,574,407.48 1,170,093.28 319,420,971.97 43,393,347.08 556,720,948.30 387,331,110.45 387,331,110.45 944,052,058.75

– 18 –

		Balance as at	Balance as at		Balance as at
			the end of		the beginning
Item			the period		of the year
Owners’ equity:
Share capital		526,766,875.00			515,018,242.00
Other equity instruments
including: preferred shares
perpetual bonds
Capital reserve		1,227,992,180.14			1,030,115,828.84
Less: treasury stock
Other comprehensive income
Special reserve
Surplus reserve		51,365,509.04			51,365,509.04
Retained earnings	-1,366,514,545.46			-1,353,434,966.46
Total owners’ equity		439,610,018.72			243,064,613.42
Total liabilities and owners’	equities	1,183,264,170.62			1,187,116,672.17
			Person in charge of
Legal representative:	Chief accountant:		accounting department:
Zhang Chong	Ma Yan		Chen Jing

– 19 –

Consolidated Income Statement January–September 2016

Prepared by: Luoyang Glass Company Limited

Unit: yuan Currency: RMB Type of audit: unaudited

					From the	From the
					beginning of	beginning of
					the year to	the year to
					the end of	the end of
				Corresponding	the Reporting	the Reporting
			Reporting	period last	period	period last
			period (July–	year (July–	(January–	year (January–
Item			September)	September)	September)	September)
I.	Total operating revenue		71,885,863.16	126,054,171.89	209,125,577.79	492,128,562.87
	Including:	Operating revenue	71,885,863.16	126,054,171.89	209,125,577.79	492,128,562.87
II.	Total operating costs		115,707,313.83	164,769,397.92	279,718,206.59	641,495,438.78
	Including:	Operating costs	89,658,773.40	126,597,532.81	218,146,294.10	505,127,696.43
		Business taxes and surcharges	1,420,016.37	1,051,855.28	1,612,158.36	3,267,049.62
		Selling expenses	1,828,343.27	7,749,709.09	5,369,499.42	23,313,031.63
		Administration expenses	21,066,615.06	28,386,630.77	48,535,045.69	82,527,617.83
		Finance expenses	2,615,887.72	983,669.97	5,833,210.94	5,423,205.06
		Impairment loss on assets	-882,321.99		221,998.08	21,836,838.21
	Add:	Gain from changes in fair value
		(losses are represented by “-”)
		Investment income
		(losses are represented by “-”)
		Among which: investment income
		from associates
		and joint ventures
		Gain from foreign currencies
		exchange (losses are
		represented by “-”)
III.	Operating	profit (loss is represented by “–”)	-43,821,450.67	-38,715,226.03	-70,592,628.80	-149,366,875.91
	Add:	Non-operating income	1,960,686.26	736,491.62	6,289,565.87	2,356,512.34
		Including: Gain from disposal
		of non-current
		assets	322,732.92	23,621.23	322,827.95	82,566.15
	Less:	Non-operating expenses	2,627,624.32	369,364.74	2,768,204.54	3,065,733.47
		Including: Loss from disposal
		of non-current
		assets

– 20 –

						From the	From the
						beginning of	beginning of
						the year to	the year to
						the end of	the end of
				Corresponding		the Reporting	the Reporting
			Reporting		period last	period	period last
			period (July–		year (July–	(January–	year (January–
Item			September)		September)	September)	September)
IV.	Total profit (total loss is represented by “-”)		-44,488,388.73	-38,348,099.15		-67,071,267.47	-150,076,097.04
	Less: Income tax expenses		810,957.54		405,666.38	3,973,673.03	2,956,698.20
V.	Net profit (net loss is represented by “-”)		-45,299,346.27	-38,753,765.53		-71,044,940.50	-153,032,795.24
	Net profit attributable to the owners of
	the Parent Company		-45,299,346.27	-36,355,886.85		-71,044,940.50	-145,785,402.27
	Minority interests			-2,397,878.68			-7,247,392.97
VI.	Net other comprehensive income after taxes
VII.	Total comprehensive income		-45,299,346.27	-38,753,765.53		-71,044,940.50	-153,032,795.24
	Total comprehensive income attributable
	to owners of the Parent Company		-45,299,346.27	-36,355,886.85		-71,044,940.50	-145,785,402.27
	Total comprehensive income attributable
	to minority interests			-2,397,878.68			-7,247,392.97
VIII.	Earnings per share:
	(I) Basic earnings per share_(RMB/share)_		-0.0860		-0.0752	-0.1352	-0.2831
	(II) Diluted earnings per share_(RMB/share)_		-0.0860		-0.0752	-0.1352	-0.2831
					Person in charge of
Legal representative:		Chief accountant:			accounting department:
	Zhang Chong		Ma Yan			Chen Jing

– 21 –

Income Statement of the Company January–September 2016

Prepared by: Luoyang Glass Company Limited

Unit: yuan Currency: RMB Type of audit: unaudited

				From the	From the
				beginning of	beginning of
				the year to	the year to
				the end of	the end of
		Reporting	Corresponding	the Reporting	the Reporting
		period	period last	period	period last
		(July–	year (July–	(January–	year (January–
Item		September )	September )	September)	September)
I.	Operating revenue	41,161,524.20	76,851,468.04	131,858,292.26	258,767,853.21
	Less: Operating costs	40,814,162.86	75,597,286.64	129,517,514.88	253,949,895.03
	Business taxes and surcharges	–	47,727.28	15,183.99	323,269.53
	Selling expenses	138,769.19	579,984.52	476,285.60	1,331,966.80
	Administration expenses	12,650,513.46	5,519,402.69	23,061,501.28	15,916,987.82
	Finance expenses	-189,568.41	-1,015,962.09	-1,095,368.36	-3,146,666.78
	Impairment loss on assets
	Add: Gain from changes in fair value
	(losses are represented by “-”)
	Investment income (losses are
	represented by “-”)	2,781,850.00	3,758,890.00	8,315,312.50	11,901,828.44
	Among which: investment income from
	associates and joint
	ventures
II.	Operating profit (loss is represented by “-”)	-9,470,502.90	-118,081.00	-11,801,512.63	2,294,229.25
	Add: Non-operating income	393,828.66	–	459,664.93	55,660.38
	Including: Gain from disposal of
	non-current assets			95.03
	Less: Non-operating expenses	1,737,731.30	25,372.62	1,737,731.30	362,604.43
	Including: Loss from disposal of
	non-current assets

– 22 –

				From the	From the
				beginning of	beginning of
				the year to	the year to
				the end of	the end of
		Reporting	Corresponding	the Reporting	the Reporting
		period	period last	period	period last
		(July–	year (July–	(January–	year (January–
Item		September )	September )	September)	September)
III.	Total profit (total loss is represented by “-”)	-10,814,405.54	-143,453.62	-13,079,579.00	1,987,285.20
	Less: Income tax expenses
IV.	Net profit (net loss is represented by “-”)	-10,814,405.54	-143,453.62	-13,079,579.00	1,987,285.20
V.	Net other comprehensive income after taxes
VI.	Total comprehensive income	-10,814,405.54	-143,453.62	-13,079,579.00	1,987,285.20
VII.	Earnings per share:

(I) Basic earnings per share (RMB/share)

(II) Diluted earnings per share (RMB/share)

Person in charge of Legal representative: Chief accountant: accounting department: Zhang Chong Ma Yan Chen Jing

– 23 –

Consolidated Cash Flow Statement January–September 2016

Prepared by: Luoyang Glass Company Limited

Unit: yuan Currency: RMB Type of audit: unaudited

Item From the beginning of the year to the end of the Reporting period (January– September) I. Cash flows from operating activities: Cash received from sale of goods or rendering of services 85,036,124.11 Tax refunds received – Other cash received from activities related to operation 6,463,039.27 Sub-total of cash inflow from operating activities 91,499,163.38 Cash paid for goods purchased and services rendered 81,215,448.28 Cash paid to and on behalf of employees 60,552,754.35 Tax payments 20,548,458.72 Other cash paid for activities related to operation 22,043,394.91 Sub-total of cash outflow from operating activities 184,360,056.26 Net cash flow from operating activities -92,860,892.88

From the beginning of the year to the end of the Reporting period last year (January– September) 249,421,087.14 80.69 11,665,323.43 261,086,491.26 236,583,887.75 65,411,211.07 40,015,183.34 32,899,631.93 374,909,914.09 -113,823,422.83

– 24 –

Item From the beginning of the year to the end of the Reporting period (January– September) II. Cash flow from investment activities: Cash received from return of investments Cash received from investment gains Net cash received from disposal of fixed assets, intangible assets and other long-term assets 322,732.92 Cash received from disposal of subsidiaries and other operating units Other cash received from activities related to investment Sub-total of cash inflow from investment activities 322,732.92 Cash paid for purchase and construction of fixed assets, intangible assets and other long-term assets 599,673.90 Cash paid for investment Other cash paid for activities related to investment 90,729,715.31 Sub-total of cash outflow from investment activities 91,329,389.21 Net cash flow from investment activities -91,006,656.29

From the beginning of the year to the end of the Reporting period last year (January– September) 10,000,000.00 10,000,000.00 22,341,288.32 22,341,288.32 -12,341,288.32

– 25 –

Item From the beginning of the year to the end of the Reporting period (January– September) III. Cash flow from financing activities: Cash received from investments 209,624,984.30 Including: cash received by subsidiaries from minority shareholders’ investment Proceeds from loans 20,000,000.00 Cash received from issuance of securities Other cash received from financing-related activities 200,276,161.61 Sub-total of cash inflow from financing activities 429,901,145.91 Cash paid for repayment of loans 74,649,536.92 Cash paid for dividends, profit, or interest payments 5,913,538.48 Including: dividend and profit paid by subsidiaries to minority shareholders Other cash paid for financing-related activities 182,355,497.44 Sub-total of cash outflow from financing activities 262,918,572.84 Net cash flow from financing activities 166,982,573.07

From the beginning of the year to the end of the Reporting period last year (January– September) 27,930,000.00 579,177,446.30 607,107,446.30 74,021,467.09 2,127,181.25 429,728,850.70 505,877,499.04 101,229,947.26

– 26 –

					From the
				From the	beginning of the
			beginning of the		year to the end
			year to the end		of the Reporting
			of the Reporting		period last year
			period	(January–	(January–
Item				September)	September)
IV. Effects of changes in exchange rate
on cash and cash equivalents				175.70	4,752.60
V. Net increase in cash and
cash equivalents			-16,884,800.40		-24,930,011.29
Add: Opening balance of		cash
	and cash equivalents		42,342,860.91		37,777,890.19
VI. Closing balance of cash
and cash equivalents			25,458,060.51		12,847,878.90
				Person	in charge of
Legal representative:		Chief accountant:		accounting department:
	Zhang Chong		Ma Yan	Chen Jing

– 27 –

Cash Flow Statement of the Company January–September 2016

Prepared by: Luoyang Glass Company Limited

Unit: yuan Currency: RMB Type of audit: unaudited

Item From the beginning of the year to the end of the Reporting period (January– September) I. Cash flows from operating activities: Cash received from sale of goods or rendering of services 52,270,623.48 Tax refunds received Other cash received from activities related to operation 267,396,926.01 Sub-total of cash inflow from operating activities 319,667,549.49 Cash paid for goods purchased and services rendered 21,503,844.96 Cash paid to and on behalf of employees 23,064,360.71 Tax payments 1,071,636.02 Other cash paid for activities related to operation 198,044,865.74 Sub-total of cash outflow from operating activities 243,684,707.43 Net cash flow from operating activities 75,982,842.06

From the beginning of the year to the end of the Reporting period last year (January– September) 238,047,212.23 373,858,163.40 611,905,375.63 3,860,731.18 12,712,127.22 5,214,736.88 210,545,492.79 232,333,088.07 379,572,287.56

– 28 –

Item From the beginning of the year to the end of the Reporting period (January– September) II. Cash flow from investment activities: Cash paid for purchase and construction of fixed assets, intangible assets and other long-term assets 53,382.45 Cash paid for investment Net cash paid for acquisition of subsidiaries and other operating units Other cash paid for activities related to investment 90,729,715.31 Sub-total of cash outflow from investment activities 90,783,097.76 Net cash flow from investment activities -90,783,097.76 III. Cash flow from financing activities: Cash received from investors 209,624,984.30 Cash received from new loans Cash received from other financing activities 39,813,771.90 Sub-total of cash inflow from financing activities 249,438,756.20 Cash paid for repayment of loans 32,621,304.38 Cash paid for dividends, profit, or interest payments 32,596.42 Other cash paid for financing-related activities 199,600,000.00 Sub-total of cash outflow from financing activities 232,253,900.80 Net cash flow from financing activities 17,184,855.40

From the beginning of the year to the end of the Reporting period last year (January– September) 4,120.00 4,120.00 -4,120.00 41,296,636.10 41,296,636.10 41,960,955.84 336,615.79 378,585,387.70 420,882,959.33 -379,586,323.23

– 29 –

				From the
			From the	beginning of the
		beginning of the		year to the end
		year to the end		of the Reporting
		of the Reporting		period last year
		period	(January–	(January–
Item			September)	September)
IV.	Effects of changes in exchange rate on
	cash and cash equivalents		175.70	4,752.60
V.	Net increase in cash and cash
	equivalents	2,384,775.40		-13,403.07
	Add: Op ening balance	of cash and cash
	equivalents		422,236.77	193,116.50
VI.	Closing balance of cash and cash
	equivalents	2,807,012.17		179,713.43
			Person	in charge of
Legal representative:		Chief accountant:	accounting department:
	Zhang Chong	Ma Yan	Chen Jing

4.2 Audit Report

Not Applicable

Company name: LUOYANG GLASS COMPANY LIMITED Legal representative: Zhang Chong* Date: 27 October 2016

As at the date of this announcement, the Board comprises four executive Directors: Mr. Zhang Chong, Mr. Ni Zhisen, Mr. Wang Guoqiang and Mr. Ma Yan; three non-executive Directors: Mr. Zhang Chengong, Mr. Xie Jun and Mr. Tang Liwei; and four independent non-executive Directors: Mr. Jin Zhanping, Mr. Liu Tianni, Mr. Ye Shuhua and Mr. He Baofeng.

* For identification purposes only

– 30 –