Shanghai Able Digital Science&Tech Co., Ltd. — Annual Report 2009

Mar 28, 2010

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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CITIC RESOURCES HOLDINGS LIMITED

(incorporated in Bermuda with limited liability) (Stock Code: 1205)

ANNOUNCEMENT OF ANNUAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2009

FINANCIAL RESULTS

The board of directors (the “ Board ”) of CITIC Resources Holdings Limited (the “ Company ”) announces the consolidated results of the Company and its subsidiaries (collectively the “ Group ”) for the year ended 31 December 2009.

CONSOLIDATED INCOME STATEMENT

Year ended 31 December

Notes REVENUE 3 Cost of sales Gross profit Other income and gains 4 Selling and distribution costs Administrative expenses Other expenses, net Finance costs 5 Share of profit of an associate Write-back of provision/(provision) for impairment of items of property, plant and equipment PROFIT/(LOSS) BEFORE TAX 6 Income tax credit/(expense) 7 PROFIT FOR THE YEAR ATTRIBUTABLE TO: Shareholders of the Company Minority interests EARNINGS PER SHARE ATTRIBUTABLE TO ORDINARY SHAREHOLDERS OF THE COMPANY 8 Basic Diluted	2009 HK$’000 19,425,447 (17,543,659) 1,881,788 164,941 (677,880) (551,433) (373,194) (822,383) 82,530 (295,631) 446,907 151,276 (2,731) 148,545 115,687 32,858 148,545 HK 1.91 cents HK 1.91 cents	2008 HK$’000 18,761,463 (15,547,583) 3,213,880 342,823 (312,080) (717,775) (31,603) (937,945) 162,665 1,719,965 (6,420,737) (4,700,772) 5,164,147 463,375 204,256 259,119 463,375 HK 3.61 cents HK 3.60 cents

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Year ended 31 December

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

PROFIT FOR THE YEAR OTHER COMPREHENSIVE INCOME Available-for-sale investments: Changes in fair value Reclassification adjustments for gains on disposal included in the consolidated income statement Income tax effect Cash flow hedges: Effective portion of changes in fair value of hedging instruments arising during the year Reclassification adjustments for losses included in the consolidated income statement Income tax effect Share of other comprehensive income of an associate Exchange differences on translation of foreign operations OTHER COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR, NET OF TAX TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR ATTRIBUTABLE TO: Shareholders of the Company Minority interests	2009 HK$’000 148,545 47,864 — (14,359) 33,505 175,028 41,689 (47,160) 169,557 65,611 235,168 169,737 438,410 586,955 603,910 (16,955) 586,955	2008 HK$’000 463,375 (72,564) 44,190 18,141 (10,233) (158,733) 23,446 87,224 (48,063) (34,316) (82,379) (733,342) (825,954) (362,579) (693,674) 331,095 (362,579)

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION

31 December

Notes NON-CURRENT ASSETS Property, plant and equipment Prepaid land lease premiums Goodwill Other intangible assets Other assets Investment in an associate Available-for-sale investments Prepayments, deposits and other receivables Deferred tax assets Total non-current assets CURRENT ASSETS Inventories Accounts receivable 10 Prepayments, deposits and other receivables Loan receivable Equity investments at fair value through profit or loss Derivative financial instruments Tax recoverable Cash and bank balances Total current assets CURRENT LIABILITIES Accounts payable 11 Tax payable Accrued liabilities and other payables Derivative financial instruments Bank and other borrowings Finance lease payables Bond obligations Provisions Total current liabilities NET CURRENT ASSETS TOTAL ASSETS LESS CURRENT LIABILITIES	2009 HK$’000 16,847,211 83,332 341,512 311,993 487,378 2,138,286 69,758 285,013 187,929 20,752,412 1,458,153 2,121,418 631,177 — 2,472 4,043 81,589 4,480,336 8,779,188 811,943 105,546 792,212 43,248 2,251,687 8,968 — 43,527 4,057,131 4,722,057 25,474,469	2008 HK$’000 16,329,307 77,433 341,512 318,875 431,568 1,617,052 17,871 137,371 139,399
		19,410,388
		1,546,048 1,715,307 912,317 3,222 1,909 37,586 160,683 4,770,747
		9,147,819
		823,088 538,806 763,489 43,221 2,871,609 — 355,649 56,553
		5,452,415
		3,695,404
		23,105,792

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31 December

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

TOTAL ASSETS LESS CURRENT LIABILITIES NON-CURRENT LIABILITIES Bank and other borrowings Finance lease payables Bond obligations Deferred tax liabilities Derivative financial instruments Provisions Other payables Total non-current liabilities NET ASSETS EQUITY Equity attributable to shareholders of the Company Issued capital Reserves Minority interests TOTAL EQUITY	2009 HK$’000 25,474,469 4,717,083 57,672 7,614,842 2,839,505 107,092 363,309 4,937 15,704,440 9,770,029 302,528 8,132,180 8,434,708 1,335,321 9,770,029	2008 HK$’000 23,105,792
		3,019,210 — 7,589,498 2,759,529 94,456 306,319 11,442
		13,780,454
		9,325,338
		302,328 7,589,607
		7,891,935 1,433,403
		9,325,338

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NOTES

1. BASIS OF PREPARATION

The financial statements have been prepared in accordance with Hong Kong Financial Reporting Standards (“ HKFRSs ”) (which include all Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards (“ HKASs ”) and Interpretations) issued by the Hong Kong Institute of Certified Public Accountants, accounting principles generally accepted in Hong Kong and the disclosure requirements of the Hong Kong Companies Ordinance. They have been prepared under the historical cost convention, except for derivative financial instruments and equity investments, which have been measured at fair value. The financial statements are presented in Hong Kong dollars (“ HK$ ”) and all values are rounded to the nearest thousand (HK$’000) except where otherwise indicated.

Basis of consolidation

The consolidated financial statements include the financial statements of the Group for the year ended 31 December 2009. Adjustments are made to bring into line any dissimilar accounting policies that may exist. The results of subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases. All income, expenses and unrealised gains and losses resulting from intercompany transactions and intercompany balances within the Group are eliminated on consolidation in full.

The acquisition of businesses during the prior year has been accounted for using the purchase method of accounting. This method involves allocating the cost of business combinations to the fair value of the identifiable assets acquired, and liabilities and contingent liabilities assumed at the date of acquisition. The cost of the acquisition is measured at the aggregate of the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition.

Minority interests represent interests of outside shareholders not held by the Group in the results and net assets of the Company’s subsidiaries.

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2. CHANGES IN ACCOUNTING POLICY AND DISCLOSURES

The Group has adopted the following new and revised HKFRSs for the first time for the current year’s financial statements. Except for certain cases giving rise to new and revised accounting polices and additional disclosures, the adoption of these new and revised HKFRSs has had no significant effect on the financial statements.

HKFRS 1 and HKAS 27 Amendments to HKFRS 1 First-time Adoption of HKFRSs and Amendments HKAS 27 Consolidated and Separate Financial Statements – Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate HKFRS 2 Amendments Amendments to HKFRS 2 Share-based Payment – Vesting Conditions and Cancellations HKFRS 7 Amendments Amendments to HKFRS 7 Financial Instruments: Disclosures – Improving Disclosures about Financial Instruments HKFRS 8 Operating Segments HKAS 1 (Revised) Presentation of Financial Statements HKAS 18 Amendment * Amendment to Appendix to HKAS 18 Revenue – Determining whether an entity is acting as a principal or as an agent HKAS 23 (Revised) Borrowing Costs HKAS 32 and HKAS 1 Amendments to HKAS 32 Financial Instruments: Amendments Presentation and HKAS 1 Presentation of Financial Statements – Puttable Financial Instruments and Obligations Arising on Liquidation HK(IFRIC) – Int 9 and Amendments to HK(IFRIC) – Int 9 Reassessment of Embedded HKAS 39 Amendments Derivatives and HKAS 39 Financial Instruments: Recognition and Measurement – Embedded Derivatives HK(IFRIC) – Int 13 Customer Loyalty Programmes HK(IFRIC) – Int 15 Agreements for the Construction of Real Estate HK(IFRIC) – Int 16 Hedges of a Net Investment in a Foreign Operation HK(IFRIC) – Int 18 Transfers of Assets from Customers (adopted from 1 July 2009) Improvements to HKFRSs Amendments to a number of HKFRSs (October 2008) **

• Included in Improvements to HKFRSs 2009 (as issued in May 2009).

• ** The Group adopted all the improvements to HKFRSs issued in October 2008 except for the amendments to HKFRS 5 Non-current Assets Held for Sale and Discontinued Operations – Plan to sell the controlling interest in a subsidiary, which are effective for annual periods beginning on or after 1 July 2009.

Other than as further explained below, the adoption of these new and revised HKFRSs has had no significant financial effect on the financial statements.

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2. CHANGES IN ACCOUNTING POLICY AND DISCLOSURES (Continued)

(a) Amendments to HKFRS 7 Financial Instruments: Disclosures – Improving Disclosures about Financial Instruments

The HKFRS 7 Amendments require additional disclosures about fair value measurement and liquidity risk. Fair value measurements related to items recorded at fair value are to be disclosed by sources of inputs using a three-level fair value hierarchy, by class, for all financial instruments recognised at fair value. In addition, a reconciliation between the beginning and ending balances is now required for level 3 fair value measurements, as well as significant transfers between levels in the fair value hierarchy. The amendments also clarify the requirements for liquidity risk disclosures with respect to derivative transactions and assets used for liquidity management.

(b) HKFRS 8 Operating Segments

HKFRS 8, which replaces HKAS 14 Segment Reporting, specifies how an entity should report information about its operating segments, based on information about the components of the entity that is available to the chief operating decision maker for the purposes of allocating resources to the segments and assessing their performance. The standard also requires the disclosure of information about the products and services provided by the segments, the geographical areas in which the Group operates, and revenue from the Group’s major customers. The Group concluded that the operating segments determined in accordance with HKFRS 8 are the same as the business segments previously identified under HKAS 14.

(c) HKAS 1 (Revised) Presentation of Financial Statements

HKAS 1 (Revised) introduces changes in the presentation and disclosures of financial statements. The revised standard separates owner and non-owner changes in equity. The statement of changes in equity includes only details of transactions with owners, with all non-owner changes in equity presented as a single line. In addition, this standard introduces the statement of comprehensive income, with all items of income and expense recognised in profit or loss, together with all other items of recognised income and expense recognised directly in equity, either in one single statement or in two linked statements. The Group has elected to present two statements.

3. OPERATING SEGMENT INFORMATION

For management purposes, the Group is organised into business units based on their products and services and has six reportable operating segments as follows:

• (a) the aluminium smelting segment comprises the operation of the Portland Aluminium Smelter which sources alumina and produces aluminium ingots in Australia;

• (b) the coal segment comprises the operation of coal mines and the sale of coal in Australia;

• (c) the import and export of commodities segment represents the export of various commodity products such as aluminium ingots, iron ore, alumina, coal and steel; and the import of other commodities and manufactured goods such as vehicle and industrial batteries, tyres, alloy wheels and various metals such as steel and aluminium extrusion products in Australia;

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3. OPERATING SEGMENT INFORMATION (Continued)

• (d) the manganese segment comprises the operation of manganese mining in the People’s Republic of China (the “ PRC ”) and Gabon, West Africa and the sale of refined manganese products in the PRC;

• (e) the crude oil segment comprises the operation of oilfields and the sale of crude oil and related products in Indonesia, the PRC and Kazakhstan; and

• (f) the others segment comprises other operating activities of the Group.

Management monitors the results of the Group’s operating segments separately for the purpose of making decisions about resources allocation and performance assessment. Segment performance is evaluated based on reportable segment profit/(loss), which is a measure of adjusted profit/(loss) before tax. The adjusted profit/(loss) before tax is measured consistently with the Group’s profit/(loss) before tax except that interest income, finance costs, dividend income, fair value gains/(losses) from the Group’s financial instruments as well as head office and corporate expenses are excluded from such measurement.

Segment assets exclude deferred tax assets, tax recoverable, cash and bank balances, equity investments at fair value through profit or loss, derivative financial instruments and other unallocated head office and corporate assets as these assets are managed on a group basis.

Segment liabilities exclude derivative financial instruments, bank and other borrowings, finance lease payables, bond obligations, tax payable, deferred tax liabilities and other unallocated head office and corporate liabilities as these liabilities are managed on a group basis.

Year ended 31 December 2009 HK$’000 Segment revenue: Sales to external customers Other income Segment results Interest income and unallocated gains Write-back of provision for impairment of items of property, plant and equipment Loss on deemed disposal of investment in an associate Unallocated expenses Profit from operating activities Unallocated finance costs Share of profit of an associate Profit before tax	Aluminium smelting 1,029,113 2,239 1,031,352 (72,549) —	Import and export of Coal commodities 344,030 13,083,451 18,749 30,717 362,779 13,114,168 68,514 198,111 — —	Manganese 2,086,364 19,764 2,106,128 178,493 —	Crude oil 2,882,489 14,715 2,897,204 178,785 446,907	Others — — — — —	Total 19,425,447 86,184 19,511,631 551,354 78,757 446,907 (66,214) (119,675) 891,129 (822,383) 82,530 151,276

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3. OPERATING SEGMENT INFORMATION (Continued)

Import and Year ended Aluminium export of 31 December 2009 smelting Coal commodities Manganese Crude oil Others HK$’000 Assets and liabilities Segment assets 2,248,772 382,149 1,678,407 3,143,289 14,901,221 — Investment in an associate Unallocated assets Total assets Segment liabilities 711,359 75,949 84,353 578,992 607,201 — Unallocated liabilities Total liabilities Other segment information: Depreciation and amortisation 119,248 16,922 1,613 152,315 751,567 — Unallocated amounts Write-back of provision for impairment of items of property, plant and equipment — — — — (446,907) — Other non-cash expenses/(income) — 12,356 — (56,288) 5,570 — Capital expenditure 32,916 50,011 1,353 526,818 771,546 — Unallocated amounts

Total 22,353,838 2,138,286 5,039,476 29,531,600 2,057,854 17,703,717 19,761,571 1,041,665 4,942 1,046,607 (446,907) (38,362) 1,382,644 5,262 1,387,906*

• Capital expenditure consists of additions to property, plant and equipment, prepaid land lease premiums and other intangible assets.

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3. OPERATING SEGMENT INFORMATION (Continued)

Year ended 31 December 2008 HK$’000 Segment revenue: Sales to external customers Other income Segment results Interest income and unallocated gains Gain on deemed disposal of investment in an associate Write-back of provision/ (provision) for impairment of items of property, plant and equipment Unallocated expenses Loss from operating activities Unallocated finance costs Share of profit of an associate Loss before tax Assets and liabilities Segment assets Investment in an associate Unallocated assets Total assets Segment liabilities Unallocated liabilities Total liabilities	Aluminium smelting 1,666,954 7,860 1,674,814 95,927 — 2,015,091 187,159	Import and export of Coal commodities 449,039 9,572,962 — 4,800 449,039 9,577,762 188,526 149,181 (4,911) — 296,798 1,448,436 137,159 204,963	Manganese 2,862,864 18,731 2,881,595 504,112 655 2,745,208 295,596	Crude oil 4,209,644 490 4,210,134 1,360,769 (6,416,481) 15,327,690 829,722	Others — — — (17,940) — — 5,670	Total 18,761,463 31,881 18,793,344 2,280,575 184,961 125,981 (6,420,737) (96,272) (3,925,492) (937,945) 162,665 (4,700,772) 21,833,223 1,617,052 5,107,932 28,558,207 1,660,269 17,572,600 19,232,869

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3. OPERATING SEGMENT INFORMATION (Continued)

Import and Year ended Aluminium export of 31 December 2008 smelting Coal commodities Manganese Crude oil Others HK$’000 Other segment information: Depreciation and amortisation 123,446 13,294 1,780 88,985 1,314,361 14,092 Unallocated amounts Provision/(write-back of provision) for impairment of items of property, plant and equipment — 4,911 — (655) 6,416,481 — Other non-cash expenses — — — 148,191 27,958 — Unallocated amounts Capital expenditure 118,234 40,292 724 592,397 1,319,415 8,846 Unallocated amounts

Total 1,555,958 3,109 1,559,067 6,420,737 176,149 14,952 191,101 2,079,908* 6,159 2,086,067

• Capital expenditure consists of additions to property, plant and equipment, prepaid land lease premiums and other intangible assets.

Geographical information

• (a) Revenue from external customers

PRC Australia Europe North America Kazakhstan Other Asian countries Others	2009 HK$’000 13,032,583 1,351,048 3,440,552 63,201 106,705 1,011,152 420,206 19,425,447	2008 HK$’000 7,176,637 2,627,373 4,869,184 147,575 181,319 3,331,905 427,470
		18,761,463

The revenue information above is based on the location of the customers.

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3. OPERATING SEGMENT INFORMATION (Continued)

Geographical information (Continued)

• (b) Non-current assets

Hong Kong PRC Australia Kazakhstan Gabon Other Asian countries	2009 HK$’000 8,329 4,529,647 4,458,944 10,724,044 95,760 678,001 20,494,725	2008 HK$’000 11,825 3,746,012 3,535,918 11,162,647 63,912 732,804
		19,253,118

The non-current assets information above is based on the location of assets and excludes financial instruments and deferred tax assets.

Information about major customers

Revenue from major customers, each of them amounted to 10% or more of the Group’s revenue, are set out below:

		2009	2008
	Operating Segment	HK$’000	HK$’000
Customer A	Import and export of commodities	2,374,609	3,112,296
Customer B	Crude oil	2,277,277	3,227,546

4. OTHER INCOME AND GAINS

An analysis of the Group’s other income and gains is as follows:

Interest income Handling service fees Gain on disposal of available-for-sale listed investments Write-off of payables Sale of scrap Gain on purchase of bond obligations Government subsidies and value added tax rebate * Gain on deemed disposal of investment in an associate Others	2009 HK$’000 54,854 30,312 — 18,613 2,358 — 11,251 — 47,553 164,941	2008 HK$’000 92,358 6,629 46,133 3,618 8,104 25,623 17,804 125,981 16,573
		342,823

• Various government grants have been received for employing handicapped workers and setting up research activities. There are no unfulfilled conditions or contingencies relating to these subsidies.

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5. FINANCE COSTS

Interest expense on bank and other borrowings repayable: Within one year In the second to fifth years, inclusive Beyond five years Interest expense on fixed rate senior notes, net Interest expense on finance leases Total interest expense on financial liabilities not at fair value through profit or loss Amortisation of fixed rate senior notes Other finance charges: Increase in discounted amounts of provision arising from the passage of time Others *	2009 HK$’000 156,453 51,265 22,724 524,059 3,785 758,286 23,027 781,313 3,254 37,816 822,383	2008 HK$’000 239,267 71,380 16,001 528,741 —
		855,389 23,027
		878,416 44,068 15,461
		937,945

• Including amortisation of up-front fees of HK$2,730,000 (2008: HK$8,015,000).

6. PROFIT/(LOSS) BEFORE TAX

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

Cost of inventories sold Depreciation Amortisation of other assets Amortisation of other intangible assets Amortisation of prepaid land lease premiums Loss on disposal/write-off of items of property, plant and equipment Loss/(gain) on deemed disposal of investment in an associate	2009 HK$’000 17,543,659 973,956 62,988 7,601 2,062 7,089 66,214	2008 HK$’000 15,547,583 1,481,079 68,160 8,158 1,670 36,250 (125,981)

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7. INCOME TAX

Current – Hong Kong Current – Elsewhere Charge for the year Overprovision in prior years Deferred Total tax expense/(credit) for the year	2009 HK$’000 — 212,604 (170,221) (39,652) 2,731	2008 HK$’000 — 1,274,107 (28,548) (6,409,706) (5,164,147)

The statutory tax rate of Hong Kong profits tax is 16.5% (2008: 16.5%) on the estimated assessable profits arising in Hong Kong during the year. No provision for Hong Kong profits tax has been made as the Group had no assessable profits arising in Hong Kong for the year (2008: Nil).

Taxes on profits assessable elsewhere have been calculated at the rates of tax prevailing in the jurisdiction countries in which the Group operates.

Provision for Australian income tax has been made at the statutory rate of 30% (2008: 30%) on the estimated assessable profits arising in Australia during the year.

For the year ended 31 December 2009, the corporate tax rates applicable to the subsidiaries and jointly-controlled entities established and operating in the PRC, Indonesia and Kazakhstan are 25% (2008: 25%), 30% (2008: 30%) and 20% (2008: 30%), respectively.

Certain PRC subsidiaries of the Group are subject to a full corporate income tax exemption for two years and a 50% reduction in the succeeding three years, commencing from the first profitable year.

Under the PRC Corporate Income Tax Law and its Implementation Rules (effective from 1 January 2008), the PRC corporate income tax rates for domestic and foreign-invested enterprises (including Sino-foreign equity joint ventures) are unified at 25%. Sino-foreign equity joint ventures which were established before the PRC Corporate Income Tax Law was promulgated and which have been entitled to the above income tax holiday can continue to enjoy the existing tax holiday until its expiry, subject to a five-year period restriction. Consequently, certain PRC subsidiaries of the Group can continue to enjoy their tax holiday, commencing from their respective first profitable year and expiring within five years from 1 January 2008.

The Group’s subsidiary owning participating interest in oil and gas properties in Indonesia is subject to branch tax at the effective rate of 14% (2008: 14%).

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7. INCOME TAX (Continued)

In accordance with the subsoil use contract, the Group’s jointly-controlled entities with operations domiciled in Kazakhstan shall pay excess profit tax (“ EPT ”) on its profit after corporate income tax each year, pursuant to the Tax Code of Kazakhstan. During the year ended 31 December 2008, EPT should be paid on a basis of the cumulative real internal rate of return (the “ IRR ”) exceeding 20%. The IRR was calculated based on the after-tax cash flows (the “ ATCF ”) and by further discounting using the published oil machinery and equipment index. The ATCF should be calculated as the cumulative gross income less all expenses relating to petroleum operations, including transporting expenses, operating costs, capital expenditures and all taxes. EPT was paid at progressive rates from 4% to 30% of the profit after corporate income tax, as shown in the table below:

IRR	EPT rate	Effective EPT rate
20% to 22%	4%	2.8%
22% to 24%	8%	5.6%
24% to 26%	12%	8.4%
26% to 28%	18%	12.6%
28% to 30%	24%	16.8%
More than 30%	30%	21.0%

On 10 December 2008, the President of Kazakhstan signed the Code of the Republic of Kazakhstan on Taxes and Other Obligation Payments to the Budget (the “ New Tax Code ”). The New Tax Code is effective from 1 January 2009. Under the New Tax Code, the corporate tax rates applicable to the Group’s jointly-controlled entities established and operating in Kazakhstan are reduced from 30% in 2008 to 20%, 17.5% and 15% in 2009, 2010 and 2011 onwards, respectively. A new calculation methodology on EPT has also been introduced based on annual, not cumulative, profitability. These changes directly offset the Group’s effective tax rate prospectively from 2008.

On 16 November 2009, the corporate tax rates applicable to the Group’s jointly-controlled entities established and operating in Kazakhstan will be increased from 17.5% and 15% in 2010 and 2011 to 20%, 17.5% and 15% in 2010 to 2012, 2013 and 2014 onwards, respectively, and are effective from 1 January 2009.

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8. EARNINGS PER SHARE ATTRIBUTABLE TO ORDINARY SHAREHOLDERS OF THE COMPANY

The calculation of basic earnings per share amounts is based on the profit for the year attributable to ordinary shareholders of the Company and the weighted average number of ordinary shares in issue during the year.

In the prior year, the calculation of basic earnings per share amounts was also adjusted to reflect the rights issue during that year.

The calculation of diluted earnings per share amounts is based on the profit for the year attributable to ordinary shareholders of the Company. The weighted average number of ordinary shares used in the calculation is the number of ordinary shares in issue during the year, as used in the basic earnings per share calculation, and the weighted average number of ordinary shares assumed to have been issued at no consideration on the deemed exercise or conversion of all dilutive potential ordinary shares into ordinary shares.

The calculations of basic and diluted earnings per share amounts are based on:

Earnings Profit attributable to ordinary shareholders of the Company used in the basic earnings per share calculation Shares Weighted average number of ordinary shares in issue during the year used in the basic earnings per share calculation Effect of dilution – weighted average number of ordinary shares: Share options	2009 2008 HK$’000 HK$’000 115,687 204,256 Number of shares 2009 2008 6,048,882,106 5,656,944,841 13,404,366 20,605,730 6,062,286,472 5,677,550,571	2008 HK$’000 204,256
		5,677,550,571

The computation of diluted earnings per share amounts for the years ended 31 December 2009 and 2008 does not assume the conversion of certain share options since the exercise of these options would result in an increase in earnings per share.

9. DIVIDEND

No interim dividend was paid during the year and the prior year. The directors do not recommend the payment of any final dividend in respect of the year (2008: Nil).

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10. ACCOUNTS RECEIVABLE

An aged analysis of the accounts receivable as at the end of the reporting period, based on the invoice date, is as follows:

Within one month One to two months Two to three months Over three months	2009 HK$’000 898,937 677,953 271,065 273,463 2,121,418	2008 HK$’000 1,059,620 490,085 93,490 72,112
		1,715,307

The Group normally offers credit terms of 30 to 120 days to its established customers.

11. ACCOUNTS PAYABLE

An aged analysis of the accounts payable as at the end of the reporting period, based on the invoice date, is as follows:

Within one month One to two months Two to three months Over three months	2009 HK$’000 739,818 25,336 18,194 28,595 811,943	2008 HK$’000 705,837 44,395 14,977 57,879
		823,088

The accounts payable are non-interest-bearing and are normally settled on 30 to 90 days term.

12. COMPARATIVE AMOUNTS

Certain comparative amounts have been reclassified to conform with the current year’s presentation.

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BUSINESS REVIEW

The Group’s operations faced many challenges due to the global financial and economic crisis which pushed energy and commodities prices in the first quarter of 2009 to their lowest levels in recent years. However, as global markets began a recovery in the second quarter of 2009, the Group’s businesses also began to improve in the second half of the year.

Oil exploration and production remains the Group’s largest business. Oil prices were weak at the beginning of 2009 but started to recover subsequently in the second quarter. However, the Group still suffered an overall drop of 35%, as compared to 2008, in respect of the average selling prices of oil from the Karazhanbas oilfield. The deployment of cyclic steam stimulation and steam flooding at the Karazhanbas oilfield continues with the aim of achieving oil production at more efficient and sustainable rates. It is expected that operations at the Karazhanbas oilfield will contribute more to the Group’s return as oil prices recover to a reasonable level.

The performance from the Group’s interest in the Seram Island Non-Bula Block fell short of expectations. The Group is carrying out necessary repairs to existing wells where production has fallen as a result of their natural decline and will re-enter two exploration wells.

The construction of foundations for oil drilling and the pre-drilling preparation on the first artificial island at the Hainan-Yuedong Block has been completed. At the end of 2009, drilling of ten wells was completed. In the second half of 2010, pilot production at four wells will commence. It is anticipated that approval of the overall development plan will be obtained in the second quarter of 2010.

Increase in production capacity from the Group’s oil interests has been a principal objective. The Group will continue to direct efforts to improve oil production and cost efficiency to maximise the return from the Group’s oil business.

The coal business contributed to the Group’s profits in 2009. The Group’s coal business included its 17.01% interest in Macarthur Coal Limited (“ Macarthur Coal ”) which is listed on the Australian Stock Exchange and its direct interest in the Coppabella and Moorvale coal mines joint venture (the “ CMJV ”) (owned and operated principally by Macarthur Coal). The coal business mainly benefited from the increase in demand for both low volatile pulverized coal injection coal and thermal coal, re-stocking at steel mills as well as spot sales to nontraditional customers by Macarthur Coal.

In December 2009, the Company announced that it had conditionally agreed to, amongst other things, sell its interest in the CMJV to Macarthur Coal. The Group will receive newly issued shares of Macarthur Coal as consideration. This transaction will facilitate the continued development of Macarthur Coal to become one of the largest independent coal producers in Australia. The Group believes that Macarthur Coal has great development potential and will bring extra economic benefits to the Group with its diverse investments in coal.

The Group’s manganese business was affected in the first half of 2009 as a result of a contraction in demand in the steel market. The demand for manganese products improved in the second half of 2009 and the prices also gradually increased. During the year, the Group increased its equity interest in 中信大錳礦業有限責任公司 (CITIC Dameng Mining Industries Limited) (“ CITIC Dameng JV ”) from 48% to 52.4% which increased the Group’s influence over its manganese business and reflected the Group’s confidence in the manganese business.

The Group continues to monitor the potential spin-off of its manganese business through a separate listing on The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”) to ensure compliance with the listing requirements, including the obtaining of approval of the Listing Committee of the Stock Exchange and shareholders of the Company.

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In January 2009, the Group completed the privatisation and delisting of CITIC Australia Trading Limited (“ CATL ”). The Group can now operate CATL with greater flexibility to compete with other trading companies. Though commodity prices generally fell following the onset of the global financial crisis, the Group has been able to take advantage of efforts by the Chinese Government to boost the economy by expanding its export business in the PRC. Through its broad selling channels, the Group has experienced an increase in profit in respect of the import and export business in adverse market conditions.

The Group’s aluminium smelting operations recorded its first ever loss as a result of a combination of weak selling prices, a drop in demand and a relatively strong Australian dollar. It is expected that as the global economy recovers in 2010, the pressure on the commodity prices will be alleviated which will improve the prospects of the Group’s aluminium smelting business.

BUSINESS OUTLOOK

As the impact of the global financial crisis seems to be easing with governments of leading economies actively implementing policies to boost trade, it is anticipated that demand for energy and commodities will increase as world markets stablise and prices gradually return to a reasonable level. The Group will continue its long-term goal to improve overall oil production and will seek early commencement of production at the Yuedong oilfield. The Group will also continue to implement cost cutting measures to improve margins.

The Group continues to regularly review its business and explore potential investment opportunities to further expand its assets in order to contribute most to the long-term economic benefits of the Group and shareholders.

LIQUIDITY, FINANCIAL RESOURCES AND CAPITAL STRUCTURE

Cash

As at 31 December 2009, the Group had a cash balance of HK$4,480.3 million. During the year, the Company obtained funds of:

• US$130.0 million (HK$1,014.0 million) by borrowing the remaining sum of the Loan (defined below) (details are set out under the heading “Borrowings” below); and

• HK$4.3 million through the issue of new shares of HK$0.05 each in the share capital of the Company (“ Shares ”) (details are set out under the heading “Share capital” below).

Borrowings

As at 31 December 2009, the Group had outstanding borrowings of HK$14,650.3 million, which comprised:

• secured bank loans of HK$926.8 million;

• unsecured bank loans of HK$5,474.0 million;

• unsecured other loans of HK$568.1 million;

• finance lease payables of HK$66.6 million; and

• bond obligations of HK$7,614.8 million.

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The secured bank loans were secured by the Group’s 22.5% participating interest in the Portland Aluminium Smelter joint venture; property, plant and equipment, and prepaid land lease premiums of CITIC Dameng JV; guarantees provided by a subsidiary of the Group and a minority shareholder; and indemnities provided by a subsidiary of the Group. The bank trade finance facilities available to CATL are guaranteed by CITIC Resources Australia Pty Limited.

Most transactions of CATL are debt funded which means CATL is highly geared. However, in contrast to term loans, CATL’s borrowings are self liquidating, transaction specific and of short durations, matching the term of the underlying trade. When sale proceeds are received at the completion of a transaction, the related borrowings are repaid accordingly.

In January 2008, the Company, as borrower, entered into a facility agreement with a syndicate of financial institutions as lenders in respect of an unsecured 5-year term loan facility of US$280 million (HK$2,184 million) (the “ Loan ”). The remaining sum of US$130 million (HK$1,014 million) under the Loan was drawn during the year for general corporate funding requirements of the Company.

In 2009, the CMJV leased certain plant and equipment for its coal mining operation. The leases are classified as finance leases.

The bond obligations comprise the issue of US$1,000,000,000 6.75% senior notes due 2014 (the “ Notes ”) by CITIC Resources Finance (2007) Limited (“ CR Finance ”), a direct wholly-owned subsidiary of the Company. The Notes were issued in May 2007. The obligations of CR Finance under the Notes are irrevocably and unconditionally guaranteed by the Company. The net proceeds of the Notes were used by the Group to facilitate the acquisition of its interests in JSC Karazhanbasmunai, Argymak TransService LLP and Tulpar Munai Service LLP and for general working capital requirements.

As at 31 December 2009, the gearing ratio and net gearing ratio of the Group were 174% and 121% (2008: 175% and 115%) respectively. Of the total outstanding borrowings, HK$2,260.7 million was repayable within one year, the majority of which being of periodic renewal nature.

Share capital

During the year, the Company issued a total of 4,000,000 new Shares as a result of the exercise of share options at an average exercise price of HK$1.077 per Share. The net proceeds of the subscription amounted to HK$4.3 million and were received in cash.

Financial risk management

The Group’s diversified business is exposed to a variety of risks, such as market risks (including interest rate risk, foreign currency risk and commodity price risk), credit risk and liquidity risk. The management of such risks is dictated by a set of internal policies and procedures designed to minimise potential adverse effects to the Group. The policies and procedures have proved effective.

The Group enters into derivative transactions, including principally interest rate swap, forward currency and commodity contracts. The purpose is to manage the interest rate, currency and commodity price risks arising from the Group’s operations and its sources of finance.

Opinion

The Board is of the opinion that after taking into account the existing available borrowing facilities and internal resources, the Group has sufficient resources to meet its foreseeable working capital requirements.

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EMPLOYEES AND REMUNERATION POLICIES

As at 31 December 2009, the Group had around 10,200 full time employees, including management and administrative staff. Most of the Group’s employees are employed in the PRC, Kazakhstan and Indonesia while the others are employed in Australia, Gabon and Hong Kong.

The Group’s remuneration policy seeks to provide a fair market remuneration in a form and value to attract, retain and motivate high quality staff. Remuneration packages are set at levels to ensure comparability and competitiveness with other companies in the industry and market competing for a similar talent pool. The emoluments are also based on an individual’s knowledge, skill, time commitment, responsibilities and performance and are determined by reference to the Group’s profits and performance. Rent-free quarters are provided to some employees in Kazakhstan, Indonesia and Gabon.

EVENTS AFTER THE REPORTING PERIOD

• (a) In December 2009, Macarthur Coal, an associate of the Group, entered into a number of acquisition agreements to acquire certain coal mine operations in Australia, including, amongst others:

• (i) acquisition of a 100% interest in Gloucester Coal Ltd. (“ Gloucester ”) through an off-market takeover offer, satisfied through the issue of shares of Macarthur Coal (“ Macarthur Shares ”) or a cash alternative. Noble Group Limited (“ Noble ”), Gloucester’s largest shareholder, will elect not to receive the cash alternative if it chooses to accept the takeover offer (collectively the “ Gloucester Transaction ”); and

• (ii) acquisition of a 25.34% interest in Middlemount Coal Pty Ltd. and 79.9% interest in Donaldson Coal Holdings Ltd. from Noble, satisfied through a combination of Macarthur Shares and cash (collectively the “ Noble Transaction ”).

The Gloucester Transaction and the Noble Transaction are subject to certain terms and conditions, including approval from relevant authorities, and are expected to be completed in 2010. Upon completion, the Group’s interest in Macarthur Coal will be diluted from 17.01% to approximately 12.50%.

• (b) In December 2009, the Group entered into an agreement with Macarthur Coal to dispose of its 100% interest in CITIC Australia Coppabella Pty Limited, which in turn owns a 7% interest in the CMJV, for a consideration of A$105 million (HK$735 million), subject to adjustment, and to terminate the CITIC Marketing Agency Agreement for a cancellation fee of A$5 million (HK$35 million). The consideration and cancellation fee will be satisfied through the issue of Macarthur Shares (collectively the “ Coppabella Transaction ”).

The Coppabella Transaction is subject to certain terms and conditions, including approval from relevant authorities, and is expected to be completed in 2010. Details of the transactions are set out in the announcement of the Company dated 22 December 2009.

Upon completion of the Gloucester Transaction, the Noble Transaction and the Coppabella Transaction, the Group’s interest in Macarthur Coal is expected to be 15.32%.

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• (c) On 1 March 2010, the Group together with the joint venture participants of the Portland Aluminium Smelter, entered into a new base load electricity contract (the “ EHA ”) with Loy Yang Power securing the power requirements of the aluminium smelter operation from 2016 to 2036. The EHA effectively allows the Group to secure electricity supply beyond 2016 when its current electricity supply agreement expires. The pricing mechanism used in the EHA between the Group and Loy Yang Power includes a component that is subject to certain escalation factors which, in turn, are affected by the consumer price index, the producer price index and labour cost. Loy Yang Power is the operator of the largest power station in the State of Victoria and Australia’s largest open cut brown coal mine.

CODE ON CORPORATE GOVERNANCE PRACTICES

The Board is of the view that the Company has, for the year ended 31 December 2009, applied the principles and complied with the applicable code provisions, and also complied with certain recommended best practices, of the Code on Corporate Governance Practices (the “ CG Code ”) as set out in Appendix 14 to the Rules Governing the Listing of Securities on the Stock Exchange (the “ Listing Rules ”), except for the deviation pursuant to paragraphs A.4.1 and E.1.2 of the CG Code.

Paragraph A.4.1 of the CG Code provides that non-executive directors should be appointed for a specific term, subject to re-election. The non-executive directors of the Company are not appointed for specific terms. However, under the Company’s bye-laws, one-third of the directors (including those appointed for a specific term) for the time being (or, if their number is not a multiple of three, the number nearest to but not less than one-third) shall retire from office by rotation provided that every director shall be subject to retirement at least once every three years. As such, the Company considers that sufficient measures have been taken to ensure that the Company’s corporate governance practices are no less exacting than those set out in paragraph A.4.1 of the CG Code.

Paragraph E.1.2 of the CG Code provides that the chairman of the independent board committee should be available to answer questions at any general meeting to approve a connected transaction or any other transaction that is subject to independent shareholders’ approval. Mr. Tsang Link Carl, Brian, the chairman of the independent board committee, was unable to attend the special general meeting of the Company held on 13 March 2009, due to personal reasons. Other members of the independent board committee were present and available to answer questions at that meeting.

MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS

The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers (the “ Model Code ”) as set out in Appendix 10 to the Listing Rules as its code of conduct for dealings in securities of the Company by the directors.

All directors confirmed, following specific enquiry by the Company, that they have complied with the required standards set out in the Model Code throughout the year.

PURCHASE, REDEMPTION OR SALE OF LISTED SECURITIES OF THE COMPANY

Neither the Company nor any of its subsidiaries purchased, redeemed or sold any of the Company’s listed securities during the year.

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AUDIT COMMITTEE

The Company has an audit committee which was established in compliance with rule 3.21 of the Listing Rules for the purpose of reviewing and providing supervision over the Group’s financial reporting process and internal controls. The audit committee comprises the three independent non-executive directors of the Company.

The audit committee has reviewed these annual results with the management of the Company.

By Order of the Board CITIC Resources Holdings Limited Sun Xinguo Chief Executive Officer

Hong Kong, 26 March 2010

As at the date hereof, the executive directors of the Company are Mr. Sun Xinguo; Ms. Li So Mui; Mr. Qiu Yiyong; Mr. Tian Yuchuan and Mr. Zeng Chen, the non-executive directors are Mr. Kong Dan; Mr. Mi Zengxin; Mr. Wong Kim Yin; Mr. Zhang Jijing and Ms. Yap Chwee Mein (alternate to Mr. Wong Kim Yin), and the independent non-executive directors are Mr. Fan Ren Da, Anthony; Mr. Ngai Man and Mr. Tsang Link Carl, Brian.

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