XD Inc. — Interim / Quarterly Report 2019

Apr 25, 2019

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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FIRST QUARTERLY REPORT OF 2019

I. IMPORTANT NOTICE

• 1.1 The board of directors, the supervisory committee and the directors, supervisors and senior management of the Company warrant the truthfulness, accuracy and completeness of the contents in the quarterly report, confirm that there are no false representations or misleading statements contained in or material omissions from this report, and jointly and severally accept legal responsibility.

• 1.2 All directors of the Company attended the board meeting to consider the quarterly report.

• 1.3 Mr. Zhou Zhuping, the chairman of the Company and Mr. Lv Feng, the chief financial officer and the chief accountant (accounting officer), warrant the truthfulness, accuracy and completeness of the financial statements contained in the quarterly report.

• 1.4 The first quarterly report of the Company was unaudited.

– 1 –

1.5 Operating highlights of the Company

• In the first quarter, by surmounting various adverse effects, the Company managed to secure the supply of raw materials and fuels with significantly improved quality, and smooth production was realized as underpinned by the stable functioning of equipment. In the first quarter, the Company produced 1,479,800 tonnes of iron, 1,568,800 tonnes of steel and 1,491,000 tonnes of steel products, representing an increase of 137,100 tonnes, 78,400 tonnes and 71,600 tonnes, or 10.21%, 5.26% and 5.04% as compared with the same period of the previous year, respectively.

• In the first quarter, by proactively expanding selling and marketing channels, the Company made great effort to promote the implementation of direct sales, direct supply and direct distribution, enhance the quality of customer services and optimize its product portfolio in a continuous manner. In the first quarter, the sales volume of steels reached 1,502,700 tonnes, representing an increase of 123,300 tonnes or 8.98%, and the operating income was RMB5.308 billion, representing an increase of 3.02%, as compared with the same period of the previous year, both fulfilling the progressive target set in the annual plan.

• In the first quarter, by positively advancing cost reduction, the Company made new breakthroughs in benchmarking, identifying deficiency, exploring internal potentials, deepening analysis, making improvements and reducing procedure costs. Safety margin of costs was further elevated. In the first quarter, over 70% of the key technical and economic indicators at the company level outpaced the best data for three consecutive months of the previous year. All kinds of consumption witnessed noticeable decline, with procedure costs decreased by RMB140 million as compared with the same period of the previous year.

– 2 –

II. BASIC INFORMATION OF THE COMPANY

2.1 Major financial data

Unit: RMB’000

	As at the	As at the
	end of the	end of the	Changes from
	reporting	previous	the end of the
	period	year	previous year
			(%)
Total assets	26,414,800	26,933,351	-1.93
Net assets attributable to the
shareholders of the Company	18,688,295	18,531,665	0.85
		From the
	From the	beginning of the
	beginning of	previous year
	year to the	to the end of the
	end of the	reporting	Changes from
	reporting	period of the	the same
	period	previous year	period last year
			(%)
Net cash flow from operating
activities	-138,559	-304,134	N/A

– 3 –

		From the
		beginning of
	From the	the previous
	beginning of	year to the
	year to the	end of the
	end of the	reporting	Changes from
	reporting	period of the	the same
	period	previous year	period last year
			(%)
Revenue from operations	5,307,920	5,152,412	3.02
Net profit attributable to the
shareholders of the Company	150,437	350,389	-57.07
Net profit attributable to the
shareholders of the Company after
extraordinary profit or loss	128,191	353,865	-63.77
Return on net assets (weighted
average) (%)	0.81	2.07	-1.26
Basic earnings per share
(RMB per share)	0.02	0.04	-50.00
Diluted earnings per share
(RMB per share)	0.02	0.04	-50.00

Note: Net cash flow from operating activities for the quarter was negative, mainly due to the raised proportion of payment in cash by the Company for the purpose of reducing procurement costs and secure resources.

– 4 –

Extraordinary profit and loss items and amounts

✓ Applicable Not applicable

Unit: RMB’000

Item Profit or loss on disposal of non-current assets Government grants included in profit or loss of the period other than those closely related with the normal operation of the Company and in compliance with national policies and regulations and conferred on the standard quota or quantity basis Capital occupancy fee from non-financial enterprises recognized through profit or loss Gains or losses on changes in fair value of financial assets held for trading, derivative financial assets, financial liabilities held for trading, and derivative financial liabilities and investment income from disposal of financial assets held for trading, derivative financial assets, financial liabilities held for trading, derivative financial liabilities and other equity investments, excluding those arising from effective hedging business related to operating activities of the Company Other non-operating income and expenses other than the above items Total

Amount for the period -359 614 6,644 2,563 12,784 22,246

– 5 –

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

Unit: Share

Total number of shareholders

147,103

Shareholdings of top 10 shareholders

			Number
	Number of		of shares
	shares held		held subject
	as at the end		to trading	Pledged and	frozen status	Nature of
(Full) Name of shareholder	**of the period **	Percentage	moratorium	Share status	Number	shareholders
		(%)
Chongqing Changshou Iron &	2,096,981,600	23.51	0	Pledged	2,096,981,600	Domestic non-
Steel Company Limited						state-owned
						legal person
HKSCC NOMINEES	531,052,021	5.95	0	Unknown	–	Overseas legal
LIMITED						person
Chongqing Qianxin Energy	427,195,760	4.79	0	Unknown	–	Unknown
Environmental Protection
Company Limited
Chongqing Rural Commercial	289,268,939	3.24	0	Unknown	–	Unknown
Bank Co., Ltd.
Chongqing Guochuang	278,288,059	3.12	0	Unknown	–	Unknown
Investment and Management
Co., Ltd.
Sinosteel Equipment &	252,411,692	2.83	0	Unknown	–	Unknown
Engineering Co., Ltd.
Bank of Chongqing Co., Ltd.	226,042,920	2.53	0	Unknown	–	Unknown
Industrial Bank Co., Ltd.	219,633,096	2.46	0	Unknown	–	Unknown
Chongqing Branch
Agricultural Bank of China	216,403,628	2.43	0	Unknown	–	Unknown
Limited Chongqing Branch
China Shipbuilding Industrial	211,461,370	2.37	0	Unknown	–	Unknown
Complete Equipment &
Logistics Co., Ltd.

– 6 –

Shareholdings of top 10 holders of shares not subject to trading moratorium

	Number of shares
	not subject to	Class and number	of shares
Name of shareholder	trading moratorium	Class	Number
Chongqing Changshou Iron & Steel Company	2,096,981,600	RMB-denominated	2,096,981,600
Limited		ordinary shares
HKSCC NOMINEES LIMITED	531,052,021	Overseas listed	531,052,021
		foreign shares
Chongqing Qianxin Energy Environmental	427,195,760	RMB-denominated	427,195,760
Protection Company Limited		ordinary shares
Chongqing Rural Commercial Bank Co., Ltd.	289,268,939	RMB-denominated	289,268,939
		ordinary shares
Chongqing Guochuang Investment and	278,288,059	RMB-denominated	278,288,059
Management Co., Ltd.		ordinary shares
Sinosteel Equipment & Engineering Co., Ltd.	252,411,692	RMB-denominated	252,411,692
		ordinary shares
Bank of Chongqing Co., Ltd.	226,042,920	RMB-denominated	226,042,920
		ordinary shares
Industrial Bank Co., Ltd. Chongqing Branch	219,633,096	RMB-denominated	219,633,096
		ordinary shares
Agricultural Bank of China Limited	216,403,628	RMB-denominated	216,403,628
Chongqing Branch		ordinary shares
China Shipbuilding Industrial Complete	211,461,370	RMB-denominated	211,461,370
Equipment & Logistics Co., Ltd.		ordinary shares

Explanation about connected relationship and There is no connected relationship between Chongqing acts in concert of the above shareholders Changshou Iron & Steel Company Limited (the Controlling Shareholder of the Company) and the other 9 shareholders and they are not parties acting in concert as defined in Measures for Management on Information Disclosure of Changes in Shareholdings of Listed Companies’ Shareholders. The Company is not aware of any connected relationship among the other 9 shareholders or whether they are parties acting in concert.

Explanation on preferential shareholders Not applicable. with voting rights restored and their shareholdings

• 2.3 Total number of preferential shareholders and shareholdings of the top 10 preferential shareholders and the top 10 holders of preferential shares not subject to trading moratorium as at the end of the reporting period

Applicable ✓ Not applicable

– 7 –

III. SIGNIFICANT EVENTS

• 3.1 Material changes in items of major accounting statements and financial indicators of the Company and the reason thereof

✓ Applicable

Not applicable

From January to March in 2019, the Group recorded a total profit of RMB152 million, decreasing by 56.74% as compared to the corresponding period last year, which was mainly due to the followings: the composite selling price of steel products amounted to RMB3,387 per tonne, representing a year-on-year decrease of 4.32% and, combined with the increased transportation fees from sales, resulting in a decrease of RMB260 million in the profit; the increase in prices of raw materials such as ore, coal, alloy, steel scrap, etc., resulted in a decrease of RMB89 million in profit; sales volume of steel products was 1,502,700 tonnes, representing a year-on-year increase of 8.98% and resulting in an increase of RMB44 million in profit; the Company vigorously promoted the cost reduction plan and as a result, critical technical and economic indicators were all improved significantly, consumption was reduced substantially and expenses were under effective control, thus resulting in a year-on-year decrease of RMB140 million in the cost in the aspect of process.

(1) Main business by sectors

Unit: RMB’000

Main operations by sectors

				Year-	Year-
				on-year	on-year
				increase/	increase/	Year-on-
				decrease in	decrease in	year increase/
	Operating	Operating	Gross	operating	operating	decrease in
By sectors	income	cost	Margin	income	cost	gross margin
			(%)	(%)	(%)	(%)
Iron and steel	5,285,003	4,968,062	6.00	2.76	7.61	Decreased by
						4.23 percentage
						points

– 8 –

(2) Analysis on material changes in assets and liabilities

Unit: RMB’000 Audit type: unaudited

				Percentage of
		Percentage of		the amount
		the amount	Amount at	at the end of
	Amount at	at the end of	the end of	the previous
	the end of the	the period in	the previous	period in	Year-on-year
Item	period	total assets	period	total assets	change	Explanation
		(%)		(%)	(%)
Financial assets held for	184,400	0.70	30,000	0.11	514.67	Purchase of wealth
trading						management product
Notes and trade	53,802	0.20	30,340	0.11	77.33	Affected by the
receivable						intermonth settlement
						of steel products
Prepayments	516,471	1.95	908,646	3.37	-43.16	Completion of the
						settlement of
						transactions with
						prepayments
Other current assets	1,332,590	5.04	575,931	2.14	131.38	Increase in notes due
						to the adjustment to
						payment methods of
						purchase transactions
Construction in process	25,492	0.10	16,593	0.06	53.63	Increase in projects in
						relation to technical
						measures and
						procedures
Notes and trade payable	1,977,612	7.48	2,946,316	10.94	-32.88	Payment for notes on
						maturity
Contract liabilities	1,356,002	5.13	1,004,280	3.73	35.02	Increase in advances
						from customers due
						to enlargement of
						production and sales
						volume
Non-current liabilities	210,000	0.79	410,000	1.52	-48.78	Repayment of principals
due within one year						of bank loans
Other current liabilities	216,960	0.82	160,675	0.60	35.03	Increase in taxes due to
						increase in advances
						from customers

– 9 –

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

✓ Applicable Not applicable

On 5 March 2019, the Resolution in Relation to Participation in Online Bidding for Acquisition of Equity Interest was approved at the 7th meeting of the eighth session of the board of directors of the Company by voting. It approved the Company to participate in the online bidding for the 28% equity interest in Chongqing Xingang Changlong Logistics Co., Ltd. (“ Xingang Changlong Company ”) with self-owned funds based on its business development demands and authorised the management of the Company to execute relevant agreements, documents and handle other specific matters in accordance with relevant procedures and laws and regulations. On the same day, the Resolution in Relation to Participation in Online Bidding for Acquisition of Equity Interest was considered and approved at the 5th meeting of the eighth session of the supervisory committee of the Company.

Up to now, the Company has executed the Equity Transfer Agreement and completed the settlement formality. Xingang Changlong Company is in the progress of filing for the change of industrial and commercial registration.

3.3 Undertakings not being fully performed during the reporting period

Applicable ✓ Not applicable

• 3.4 Warning and explanation in the forecast of any possible loss in accumulated net profit from the beginning of the year to the end of next reporting period or any material changes compared to the corresponding period of last year

Applicable ✓ Not applicable

Company Name Chongqing Iron & Steel Company Limited

Legal Representative Zhou Zhuping

Date 25 April 2019

– 10 –

IV. APPENDICES

4.1 Financial statements

Consolidated Balance Sheet

31 March 2019

Prepared by: Chongqing Iron & Steel Company Limited

	Unit: RMB’000 Audit	type: unaudited
	31 March	31 December
Item	2019	2018
Current assets:
Cash and bank balance	1,896,205	2,764,631
Balances with clearing companies
Placements with banks and other
financial institutions
Held-for-trading financial assets	184,400	30,000
Financial assets at fair value through
profit and loss
Derivative financial assets
Bills and accounts receivable	53,802	30,340
Including: Bills receivable
Accounts receivable	53,802	30,340
Prepayments	516,471	908,646
Premiums receivable
Accounts receivable from reinsurers
Deposits receivable from reinsurers
Other receivables	28,092	10,506
Including: Interests receivable
Dividends receivable
Proceeds from financial assets
purchased under agreements to resell
Inventories	3,126,679	3,192,201
Contract assets
Held-for-sale assets
Non-current assets due within one	year
Other current assets	1,332,590	575,931
Total current assets	7,138,239	7,512,255

– 11 –

Item Non-current assets: Loans and advances granted Debt investments Available-for-sale financial assets Other debt investments Held-to-maturity investments Long-term receivables Long-term equity investments Other equity instruments investments Other non-current financial assets Investment properties Fixed assets Construction in progress Biological assets for production Fuel assets Right-of-use assets Intangible assets Development expenses Goodwill Long-term deferred expenditures Deferred income tax assets Other non-current assets Total non-current assets Total assets	31 March 2019 28,539 5,000 16,747,689 25,492 2,438,774 31,067 19,276,561 26,414,800	31 December 2018 5,000 16,914,109 16,593 2,454,327 31,067 19,421,096 26,933,351

– 12 –

Item Current liabilities: Short-term borrowings Borrowings from central bank Placements from banks and other financial institutions Held-for-trading financial liabilities Financial liabilities at fair value through profit and loss Derivative financial liabilities Bills and accounts payable Advances from customers Disposal of repurchased financial assets Deposit taking and deposit in interbank market Customer deposits for trading in securities Customer deposits for underwriting Employeeremunerationpayable Taxes payable Other payables Including: Interests payable Dividends payable Handling charges and commissions payable Payable to reinsurers Contract liabilities Held-for-sale liabilities Non-current liabilities due within one year Other current liabilities Total current liabilities	31 March 2019 1,977,612 343,789 32,184 393,616 6,286 1,356,002 210,000 216,960 4,530,163	31 December 2018 2,946,316 333,407 35,733 354,665 6,317 1,004,280 410,000 160,675 5,245,076

– 13 –

Item Non-current liabilities: Deposits for insurance contracts Long-term borrowings Debentures payable Including: Preferential shares Perpetual bonds Lease liabilities Long-term payables Long-term staff remuneration payable Accrued liabilities Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities	31 March 2019 300,000 228,461 39,881 2,628,000 3,196,342 7,726,505	31 December 2018 300,000 240,615 40,495 2,575,500 3,156,610 8,401,686

– 14 –

		31 March	31 March		31 December
Item			2019		2018
Owners’ equity (or Shareholders’
equity)
Paid-in capital (or share capital)		8,918,602			8,918,602
Other equity instruments
Including: Preferential shares
Perpetual bonds
Capital reserve		19,282,147			19,282,147
Less: Treasury stock
Other comprehensive income
Special reserve			19,391		13,644
Surplus reserve			606,991		606,991
General risk provision
Undistributed profit		-10,138,836			-10,289,719
Total equity attributable to owners of
the parent company		18,688,295			18,531,665
Minority interests
Total owners’ equity (or shareholders’
equity)		18,688,295			18,531,665
Total liabilities and owners’ equity (or
shareholders’ equity)		26,414,800			26,933,351
Legal Representative: Chief	Financial Officer:		Chief Accountant:
Zhou Zhuping	Lv Feng				Lv Feng

– 15 –

31 March 2019

Balance Sheet of the Parent Company

Prepared by: Chongqing Iron & Steel Company Limited

	Unit: RMB’000 Audit	type: unaudited
	31 March	31 December
Item	2019	2018
Current assets:
Cash and bank balance	1,890,618	2,762,442
Held-for-trading financial assets	184,400	30,000
Financial assets at fair value through
profit and loss
Derivative financial assets
Bills and accounts receivable	54,694	29,851
Including: Bills receivable
Accounts receivable	54,694	29,851
Prepayments	516,471	908,523
Other receivables	28,088	10,500
Including: Interests receivable
Dividends receivable
Inventories	3,126,679	3,192,201
Contract assets
Held-for-sale assets
Non-current assets due within one	year
Other current assets	1,332,590	575,931
Total current assets	7,133,540	7,509,448

– 16 –

Item Non-current assets: Debt investments Available-for-sale financial assets Other debt investments Held-to-maturity investments Long-term receivables Long-term equity investments Other equity instruments investments Other non-current financial assets Investment properties Fixed assets Construction in progress Biological assets for production Fuel assets Right-of-use assets Intangible assets Development expenses Goodwill Long-term deferred expenditures Deferred income tax assets Other non-current assets Total non-current assets Total assets	31 March 2019 28,539 5,000 16,747,492 25,492 2,438,774 31,067 19,276,364 26,409,904	31 December 2018 5,000 16,914,084 16,593 2,454,327 31,067 19,421,071 26,930,519

– 17 –

Item Current liabilities: Short-term borrowings Held-for-trading financial liabilities Financial liabilities at fair value through profit and loss Derivative financial liabilities Bills and accounts payable Advances from customers Contract liabilities Employeeremunerationpayable Taxes payable Other payables Including: Interests payable Dividends payable Held-for-sale liabilities Non-current liabilities due within one year Other current liabilities Total current liabilities	31 March 2019 1,977,390 1,356,002 343,789 29,676 393,438 6,286 210,000 216,960 4,527,255	31 December 2018 2,945,889 1,004,220 333,407 34,741 354,665 6,317 410,000 160,675 5,243,597

– 18 –

Item Non-current liabilities: Long-term borrowings Debentures payable Including: Preferential shares Perpetual bonds Lease liabilities Long-term payables Long-term staff remuneration payable Accrued liabilities Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities	31 March 2019 300,000 228,461 39,881 2,628,000 3,196,342 7,723,597	31 December 2018 300,000 240,615 40,495 2,575,500 3,156,610 8,400,207

– 19 –

		31 March	31 March		31 December
Item			2019		2018
Owners’ equity (or Shareholders’
equity)
Paid-in capital (or share capital)		8,918,602			8,918,602
Other equity instruments
Including: Preferential shares
Perpetual bonds
Capital reserve		19,313,090			19,313,090
Less: Treasury stock
Other comprehensive income
Special reserve			19,391		13,644
Surplus reserve			577,013		577,012
Undistributed profit		-10,141,789			-10,292,036
Total owners’ equity (or shareholders’
equity)		18,686,307			18,530,312
Total liabilities and owners’ equity
(or shareholders’ equity)		26,409,904			26,930,519
Legal Representative: Chief	Financial Officer:		Chief Accountant:
Zhou Zhuping	Lv Feng				Lv Feng

– 20 –

Consolidated Income Statement

January to March 2019

Prepared by: Chongqing Iron & Steel Company Limited

Unit: RMB’000 Audit type: unaudited

		First quarter	First quarter
Item		of 2019	of 2018
I.	Total revenue from operations	5,307,920	5,152,412
	Including: Revenue from operations	5,307,920	5,152,412
	Interest income
	Premiums earned
	Income from fee and commission
II.	Total operating costs	5,171,614	4,797,827
	Including: Operating costs	4,983,100	4,620,307
	Interest expenses
	Fee and commission expenses
	Surrender value
	Net expenditure for compensation payments
	Net drawing on deposits for insurance contracts
	Expenditures for insurance policy dividend
	Reinsurance costs
	Taxes and surcharges	41,104	29,926
	Selling expenses	12,991	21,891
	Administrative expenses	113,485	93,734
	R&D expenses
	Finance cost	20,934	31,969
	Including: Interest expenses	40,021
	Interest income	-20,062
	Asset impairment loss
	Credit impairment loss

– 21 –

		First quarter	First quarter
Item		of 2019	of 2018
	Add: Other income	3,176
	Gains from investment (loss is represented by “-”)
	Including: G ains from investment in associates and joint ventures
	Exchange gain (loss is represented by “-”)
	Income on hedging the net exposure (loss is represented by “-”)
	Gain from change in fair value (loss is represented by “-”)
	Gain on disposal of assets (loss is represented by “-”)	-359
III.	P rofit from operations (loss is represented by “-”)	139,123	354,585
	Add: Non-operating income	12,888	451
	Less: Non-operating expenses	104	3,927
IV.	T otal profit (total loss is represented
	by “-”)	151,907	351,109
	Less: Income tax expense	1,470	620
V.	Net profit (net loss is represented by “-”)	150,437	350,489
	(I) Classified on a going concern basis
	1. N et profit from continuing operations (net loss is represented by “-”)	150,437	350,489
	2. N et profit from discontinued operations (net loss is represented by “-”)
	(II) Classified according to the ownership
	1. N et profit attributable to shareholders of the parent company (net loss is
	represented by “-”)	150,437	350,389
	2. P rofit or loss attributable to minority shareholders (net loss is
	represented by “-”)		100

– 22 –

First quarter First quarter of 2019 of 2018

Item

VI. Other comprehensive income (net of tax)

Other comprehensive income (net of tax) attributable to owners of the parent

company

• (I) O ther comprehensive income that will not be reclassified to profit or loss

• C hanges in re-measurement of defined benefit plan

• O ther comprehensive income accounted for using equity method that will not be reclassified to profit or loss

• C hanges in fair value of other equity instruments investment

• C hanges in fair value of the enterprise’s own credit risk

• (II) O ther comprehensive income that will be reclassified to profit or loss

• O ther comprehensive income accounted for using equity method which will be reclassified to profit and loss

• C hanges in fair value of other debt investments

• Gains or losses on changes in fair value of available-for-sale financial assets

• Financial assets reclassified into other comprehensive income

• Gain or loss on reclassification of held-to-maturity investments to available-for-sale financial assets

• Provision for credit impairment of other debt investments

• Hedging reserve for cash flows (Effective portion of cash flow adjusted for hedging gain or loss)

• Exchange difference on translation of foreign financial statements

• Others

Other comprehensive income (net of tax) attributable to minority shareholders

– 23 –

			First quarter	First quarter
Item			of 2019	of 2018
VII.	Total comprehensive income		150,437	350,489
	Total comprehensive income attributable to owners of the parent company		150,437	350,389
	Total comprehensive income attributable to minority shareholders			100
VIII.	Earnings per share:
	(I) Basic earnings per share
	(RMB per share)		0.02	0.04
	(II) Diluted earnings per share
	(RMB per share)		0.02	0.04
Legal Representative:		Chief Financial Officer:	Chief Accountant:
	Zhou Zhuping	Lv Feng	Lv Feng

– 24 –

Income Statement of the Parent Company

January to March 2019

Prepared by: Chongqing Iron & Steel Company Limited

Unit: RMB’000 Audit type: unaudited

		First quarter	First quarter
Item		of 2019	of 2018
I.	Revenue from operations	5,301,839	5,152,412
	Less: Operating costs	4,983,100	4,620,307
	Taxes and surcharges	40,987	29,922
	Selling expenses	12,906	21,757
	Administrative expenses	113,485	93,190
	R&D expenses
	Finance cost	20,935	36,712
	Including: Interest expenses	40,021
	Interest income	-20,060
	Asset impairment loss
	Credit impairment loss
	Add: Other income	3,176
	Gains from investment (loss is represented by “-”)	4,220
	Including: G ains from investment in associates and joint ventures
	Income on hedging the net exposure (loss is represented by “-”)
	Gain from change in fair value (loss is represented by “-”)
	Gain on disposal of assets (loss is represented by “-”)	-359
II.	P rofit from operations (loss is
	represented by “-”)	137,463	350,524
	Add: Non-operating income	12,887	366
	Less: Non-operating expenses	104	1,270

– 25 –

	First quarter	First quarter
Item	of 2019	of 2018
III. T otal profit (total loss is represented by “-”)	150,246	349,620
Less: Income tax expense
IV. Net profit (net loss is represented by “-”)	150,246	349,620
(I) N et profit from continuing operations (net loss is represented by “-”)	150,246	349,620
(II) N et profit from discontinued operations (net loss is represented by “-”)

V. Other comprehensive income (net of tax)

• (I) O ther comprehensive income that will not be reclassified to profit or loss

• C hanges in re-measurement of defined benefit plan

• O ther comprehensive income accounted for using equity method that will not be reclassified to profit or loss

• C hanges in fair value of other equity instruments investment

• C hanges in fair value of the enterprise’s own credit risk

• (II) O ther comprehensive income that will be reclassified to profit or loss

• O ther comprehensive income accounted for using equity method which will be reclassified to profit and loss

• C hanges in fair value of other debt investments

• Gains or losses on changes in fair value of available-for-sale financial assets

• Financial assets reclassified into other comprehensive income

• Gain or loss on reclassification of held-to-maturity investments to available-for-sale financial assets

• Provision for credit impairment of other debt investments

– 26 –

		First quarter	First quarter
Item		of 2019	of 2018
7. Hedging reserve for cash	flows (Effective portion of cash flow adjusted
for hedging gain or loss)
8. Exchange difference on translation of foreign financial statements
9. Others
VI. Total comprehensive income		150,246	349,620
VII. Earnings per share:
(I) Basic earnings per share (RMB per share)		0.02	0.04
(II) Diluted earnings per share (RMB per share)		0.02	0.04
Legal Representative:	Chief Financial Officer:	Chief Accountant:
Zhou Zhuping	Lv Feng	Lv Feng

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Consolidated Cash flow Statement

January to March 2019

Prepared by: Chongqing Iron & Steel Company Limited

Unit: RMB’000 Audit type: unaudited

Item I. Cash flow from operating activities: Cash received from sale of goods or rendering of services Net increase in customer and interbank deposits Net increase in borrowings from central bank Net increase in placements from other financial institutions Cash received from premiums under original insurance contract Net cash received from reinsurance business Net increase in deposits of policy holders and investment Cash received from interest, fees and commissions Net increase in placements from banks and other financial institutions Net increase in capital from repurchase business Net cash received from trading in securities Refunds of taxes Other cash received relating to operating activities Sub-total of cash inflow from operating activities	First quarter of 2019 5,191,781 378,730 5,570,511	First quarter of 2018 3,614,301 61,684 3,675,985

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Item Cash paid for goods purchased and service received Net increase in customer loans and advances Net increase in deposit in central bank and interbank deposit Cash paid for compensation payments under original insurance contract Net increase in financial assets held for trading purpose Net increase in placements with banks and other financial institutions Cash paid for insurance policy dividend Cash paid to and on behalf of employees Cash paid for all types of taxes Other cash paid relating to operating activities Sub-total of cash outflow from operating activities Net cash flow from operating activities II. Cash flows from investment activities: Cash received from disposal of investments Cash received from return on investments Net cash received from disposal of fixed assets, intangible assets and other long-term assets Net cash received from disposal of subsidiaries and other operating entities Other cash received relating to investing activities Sub-total of cash inflow from investing activities	First quarter of 2019 4,538,459 234,537 159,759 776,315 5,709,070 -138,559 220,000 6,782 226,782	First quarter of 2018 2,922,266 235,733 13,933 808,187 3,980,119 -304,134

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Item Cash paid for acquisition and construction of fixed assets, intangible assets and other long- term assets Cash paid for investments Net increase in pledged loans Net cash paid for acquiring subsidiaries and other operating entities Other cash paid relating to investing activities Sub-total of cash outflow from investing activities Net cash flow from investing activities III. Cash flow from financing activities: Cash received from investments Including: P roceeds received by subsidiaries from minority shareholders’ investment Cash received from borrowings Cash received from issuing bonds Other cash received relating to financing activities Sub-total of cash inflow from financing activities Cash paid for repayments of debts Cash paid for distribution of dividends and profits or for interest expenses Including: D ividend and profit paid by subsidiaries to minority shareholders Other cash paid relating to financing activities Sub-total of cash outflow from financing activities	First quarter of 2019 374,400 28,538 402,938 -176,156 52,500 52,500 200,000 41,592 200,000	First quarter of 2018 41,592

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	First quarter	First quarter		First quarter
Item		of 2019		of 2018
Net cash flow from financing activities		-147,500		-41,592
IV. E ffect of fluctuations in exchange rates on
cash and cash equivalents		-2,710
V. Net increase in cash and cash equivalents		-462,215		-348,436
Add: B alance of cash and cash equivalents at
the beginning of the period		1,969,543		868,961
VI. B alance of cash and cash equivalents at the
end of the period		1,507,328		520,525
Legal Representative: Chief Financial Officer:		Chief Accountant:
Zhou Zhuping Lv Feng				Lv Feng

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Cash Flow Statement of the Parent Company

January to March 2019

Prepared by: Chongqing Iron & Steel Company Limited

Unit: RMB’000 Audit type: unaudited

Item I. Cash flow from operating activities: Cash received from sale of goods or rendering of services Refunds of taxes Other cash received relating to operating activities Sub-total of cash inflow from operating activities Cash paid for goods purchased and service received Cash paid to and on behalf of employees Cash paid for all types of taxes Other cash paid relating to operating activities Sub-total of cash outflow from operating activities Net cash flow from operating activities	First quarter of 2019 4,873,468 12,208 4,885,676 4,538,459 234,537 159,760 94,875 5,027,631 -141,955	First quarter of 2018 3,614,301 54,228 3,668,529 2,921,057 235,410 13,045 804,858 3,974,370 -305,841

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Item II. Cash flows from investment activities: Cash received from disposal of investments Cash received from return on investments Net cash received from disposal of fixed assets, intangible assets and other long-term assets Net cash received from disposal of subsidiaries and other operating entities Other cash received relating to investing activities Sub-total of cash inflow from investing activities Cash paid for acquisition and construction of fixed assets, intangible assets and other long- term assets Cash paid for investments Net cash paid for acquiring subsidiaries and other operating entities Other cash paid relating to investing activities Sub-total of cash outflow from investing activities Net cash flow from investing activities	First quarter of 2019 220,000 6,782 226,782 374,400 28,539 402,939 -176,157	First quarter of 2018

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	First quarter	First quarter		First quarter
Item		of 2019		of 2018
III. Cash flow from financing activities:
Cash received from investments
Cash received from borrowings
Other cash received relating to financing
activities		52,500
Sub-total of cash inflow from financing
activities		52,500
Cash paid for repayments of debts		200,000
Cash paid for distribution of dividends and
profits or for interest expenses		41,592
Other cash paid relating to financing activities
Sub-total of cash outflow from financing
activities		200,000		41,592
Net cash flow from financing activities		-147,500		-41,592
IV. E ffect of fluctuations in exchange rates on
cash and cash equivalents
V. Net increase in cash and cash equivalents		-465,612		-347,433
Add: B alance of cash and cash equivalents at the
beginning of the period		1,967,354		779,826
VI. B alance of cash and cash equivalents at the
end of the period		1,501,742		432,393
Legal Representative: Chief Financial Officer:		Chief Accountant:
Zhou Zhuping Lv Feng				Lv Feng

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• 4.2 Adjustments to relevant items in the opening financial statements upon initial application of the New Financial Instruments Standard, the New Revenue Standard and the New Lease Standard

Applicable ✓ Not applicable

• 4.3 Retrospective adjustments to comparative figures of previous periods upon initial application of the New Financial Instruments Standard and the New Lease Standard

Applicable ✓ Not applicable

4.4 Auditor’s report

Applicable ✓ Not applicable

By order of the Board Chongqing Iron & Steel Company Limited Meng Xiangyun Secretary to the Board

Chongqing, the PRC, 26 April 2019

As at the date of this announcement, the directors of the Company are: Mr. Zhou Zhuping (Non-executive Director), Mr. Li Yongxiang (Executive Director), Mr. Tu Deling (Executive Director), Mr. Zhang Shuogong (Executive Director), Mr. Xu Yixiang (Independent Non-executive Director), Mr. Xin Qingquan (Independent Non-executive Director) and Mr. Wong Chunwa (Independent Non-executive Director).

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