Guangshen Railway Company Limited (GNGYF) 6-K First Quarterly Report for 2016

Exhibit 99.1

(a joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 00525)

OVERSEAS REGULATORY ANNOUNCEMENT

FIRST QUARTERLY REPORT FOR 2016

In accordance with the requirements of the China Securities Regulatory Commission (“CSRC”), Guangshen Railway Company Limited (the “Company”) is required to issue a first quarterly report.

The financial information set out in this quarterly report has not been audited, and has been prepared in accordance with the PRC Enterprise Accounting Standards.

This announcement is made in accordance with Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

1. IMPORTANT NOTICE

1.1 The board of directors, supervisory committee, directors, supervisors and senior management of the Company warrant that the contents of this quarterly report are authentic, accurate and complete, and there are no misrepresentations or misleading statements contained in or material omissions from this quarterly report, and severally and jointly accept the related legal responsibility.

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

1.3 Mr. Wu Yong, Chairman of the Company, Mr. Hu Lingling, General Manager, Mr. Tang Xiangdong, Chief Accountant and Mr. Lin Wensheng, Chief of Finance Department hereby declare that the authenticity, accuracy and completeness of the financial statements contained in this quarterly report are warranted.

1.4 The financial statements contained in the Company’s first quarterly financial report for 2016 have not been audited.

— 1 —

2. PRINCIPAL FINANCIAL INFORMATION AND CHANGES IN SHAREHOLDERS OF THE COMPANY

2.1 Principal financial information

			Unit: ¥ Currency: RMB
	At the end of this reporting period		At the end of last year		Increase/decrease as compared with the end of last year (%)
Total assets		31,496,953,086		31,943,271,998		(1.40	)
Net assets attributable to shareholders of listed company		27,789,076,369		27,462,486,711		1.19
	From the beginning of the year to the end of the reporting period		From the beginning of last year to the end of the reporting period of last year		Increase/decrease as compared with the same period of last year (%)
Net cash flow from operating activities		59,032,728		855,076,631		(93.10	)
	From the beginning of the year to the end of the reporting period		From the beginning of last year to the end of the reporting period of last year		Increase/decrease as compared with the same period of last year (%)
Revenues from operation		4,011,817,621		3,678,860,629		9.05
Net profit attributable to shareholders of listed company		326,589,658		262,276,663		24.52
Net profit attributable to shareholders of listed company after extraordinary gain or loss		338,065,803		273,343,101		23.68
Weighted average return on net assets (%)		1.18		0.98		Increase by 0.20 percentage point
Basic earnings per share (¥/share)		0.046		0.037		24.32
Diluted earnings per share (¥/share)		0.046		0.037		24.32

— 2 —

Extraordinary gain or loss items and amounts

x  Applicable    ¨  Not applicable

Unit: ¥ Currency: RMB
Item	Amount for the period
Gain or loss on disposal of non-current assets		(15,954,171	)
Government grants included in profit or loss for the period, other than government grants closely related to the normal operation of the Company and granted on an on-going basis in accordance with specific standard amount or quantity in compliance with national policies		847,810
Other non-operating income and expenses other than the items above		(53,436	)
Effect of minority interests (after tax)		(49	)
Effect of income tax		3,683,701
Total		(11,476,145	)

Note:Extraordinary losses are expressed in negative figures.

— 3 —

2.2 Total number of shareholders, shareholding of top ten shareholders and top ten shareholders holding shares without selling restrictions at the end of the reporting period

											Unit: Shares
Total number of shareholders
(Number)												293,170
Shareholding of top ten shareholders
					Number
	Number of				of shares		Subject to pledge
	shares held				with selling		or frozen
	at the end		Percentage		restrictions		Status of				Nature of
Name of shareholder (Full name)	of the period		(%)		held		shares		Number		shareholder
Guangzhou Railway (Group) Company		2,629,451,300		37.12		—		None		—		State-owned legal person
HKSCC NOMINEES LIMITED (Note)		1,416,834,865		20.00		—		Unknown		—		Foreign legal person
China Securities Finance Corporation Limited		175,117,986		2.47		—		Unknown		—		State-owned legal person
Central Huijin Asset Management Co., Ltd.		85,985,800		1.21		—		Unknown		—		State-owned legal person
National Social Insurance Fund — 404 Portfolio		45,627,839		0.64		—		Unknown		—		Other
The Government of Kuwait Investment Authority — own funds		33,525,644		0.47		—		Unknown		—		Other
Industrial and Commercial Bank of China Limited — China Southern Consumption Vitality Flexible Allocation Hybrid Initiated Securities Investment Fund		32,142,940		0.45		—		Unknown		—		Other
Taiyuan Iron & Steel (Group) Co., Ltd.		30,781,989		0.43		—		Unknown		—		State-owned legal person
Boshi Fund — Agricultural Bank of China — Boshi China Securities Financial Asset Management Plan		28,101,600		0.40		—		Unknown		—		Other
Dacheng Fund — Agricultural Bank of China — Dacheng CSI Financial Asset Management Plan		28,101,600		0.40		—		Unknown		—		Other

— 4 —

Shareholding of top ten shareholders
					Number
	Number of				of shares		Subject to pledge
	shares held				with selling		or frozen
	at the end		Percentage		restrictions		Status of				Nature of
Name of shareholder (Full name)	of the period		(%)		held		shares		Number		shareholder
ICBC Credit Suisse Fund — Agricultural Bank of China – ICBC Credit Suisse CSI Financial Assets Management Plan		28,101,600		0.40		—		Unknown		—		Other
Harvest Fund — Agricultural Bank of China — Harvest CSI Financial Assets Management Plan		28,101,600		0.40		—		Unknown		—		Other
Southern Fund – Agricultural Bank of China — Southern CSI Financial Asset Management Plan		28,101,600		0.40		—		Unknown		—		Other
Efunds — Agricultural Bank of China — Efunds CSI Financial Asset Management Plan		28,101,600		0.40		—		Unknown		—		Other
Yinhua Fund — Agricultural Bank of China — Yinhua CSI Financial Asset Management Plan		28,101,600		0.40		—		Unknown		—		Other
Zhongou Fund — Agricultural Bank of China — Zhongou CSI Financial Asset Management Plan		28,101,600		0.40		—		Unknown		—		Other
Beijing Fengshan Investment Co. Ltd.		22,481,281		0.32		—		Unknown		—		Other

— 5 —

Shareholding of top ten shareholders holding shares without selling restrictions
Name of shareholders	Number of shares held without selling		Class and number of shares
(Full name)	restrictions		Class		Number
Guangzhou Railway (Group) Company		2,629,451,300		Renminbi-denominated ordinary shares		2,629,451,300
HKSCC NOMINEES LIMITED (Note)				Renminbi-denominated ordinary shares		7,793,416
		1,416,834,865		Overseas listed foreign shares		1,409,041,449
China Securities Finance Corporation Limited		175,117,986		Renminbi-denominated ordinary shares		175,117,986
Central Huijin Asset Management Co., Ltd.		85,985,800		Renminbi-denominated ordinary shares		85,985,800
National Social Insurance Fund — 404 Portfolio		45,627,839		Renminbi-denominated ordinary shares		45,627,839
The Government of Kuwait Investment Authority — own funds		33,525,644		Renminbi-denominated ordinary shares		33,525,644
Industrial and Commercial Bank of China Limited — China Southern Consumption Vitality Flexible Allocation Hybrid Initiated Securities Investment Fund		32,142,940		Renminbi-denominated ordinary shares		32,142,940
Taiyuan Iron & Steel (Group) Co., Ltd.		30,781,989		Renminbi-denominated ordinary shares		30,781,989
Boshi Fund — Agricultural Bank of China — Boshi China Securities Financial Asset Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600
Dacheng Fund — Agricultural Bank of China — Dacheng CSI Financial Asset Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600
ICBC Credit Suisse Fund — Agricultural Bank of China — ICBC Credit Suisse CSI Financial Assets Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600

— 6 —

Shareholding of top ten shareholders holding shares without selling restrictions
Name of shareholders	Number of shares held without selling		Class and number of shares
(Full name)	restrictions		Class		Number
Harvest Fund — Agricultural Bank of China — Harvest CSI Financial Assets Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600
Southern Fund — Agricultural Bank of China — Southern CSI Financial Asset Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600
Efunds – Agricultural Bank of China — Efunds CSI Financial Asset Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600
Yinhua Fund — Agricultural Bank of China — Yinhua CSI Financial Asset Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600
Zhongou Fund — Agricultural Bank of China — Zhongou CSI Financial Asset Management Plan		28,101,600		Renminbi-denominated ordinary shares		28,101,600
Beijing Fengshan Investment Co. Ltd.		22,481,281		Renminbi-denominated ordinary shares		22,481,281
Statement regarding connected relationship or concerted action of the above shareholders		The Company is unaware whether the above shareholders are connected or concerted parties as defined in Measures on Administration of Acquisitions of Listed Companies.

Note: 7,793,416 A shares and 1,409,041,449 H shares of the Company, which accounted for 0.14% and 98.44% of the A share capital and H share capital in issue of the Company respectively, were held by HKSCC NOMINEES LIMITED in the capacity of various clients.

— 7 —

2.3 Total number of preference shareholders, shareholding of top ten preference shareholders and top ten preference shareholders holding shares without selling restrictions at the end of the reporting period

¨  Applicable    x  Not applicable

3. SIGNIFICANT EVENTS

3.1 Significant changes of key accounting items and financial indicators and reasons for changes

¨  Applicable    x  Not applicable

3.2 Progress and impact of significant events and analysis and explanations for solutions

¨  Applicable    x  Not applicable

3.3 Status of fulfillment of commitments undertaken by the Company and shareholders holding 5% or above

x  Applicable    ¨  Not applicable

During the reporting period, the commitments of Guangzhou Railway (Group) Company, the largest shareholder of the Company are as follows:

(1) Guangzhou Railway (Group) Company and any of its subsidiaries would not engage, directly or indirectly, by any means, in any business activities that may compete with the railway transportation and related businesses of the Company within the service territory of the Company. After the acquisition of the transportation operational assets and businesses of Guangzhou-Pingshi Railway Line, Guangzhou Railway (Group) Company and any of its subsidiaries would not engage in horizontal competition with the Company either.

(2) Guangzhou Railway (Group) Company would reduce the number of connected transactions as much as practicable in its operation relations with the Company. For necessary connected transactions, Guangzhou Railway (Group) Company would perform these connected transactions on the basis of openness, impartiality and fairness without abusing its position as a substantial shareholder and behaving in a manner that is detrimental to the interests of the Company.

— 8 —

(3) Guangzhou Railway (Group) Company would lease the land of Guangzhou-Pingshi Railway Line to the Company after securing the land by way of licensed operation. Guangzhou Railway (Group) Company and the Company entered into a land lease agreement that became effective on January 1, 2007, pursuant to which, the land use right for the Guangzhou-Pingshi Railway Line was leased to the Company by Guangzhou Railway (Group) Company for a leasing term of 20 years. It was agreed by the two parties that the annual land rent should not exceed RMB74 million.

(4) Guangzhou Railway (Group) Company issued an undertaking letter in relation to enhancement on managing unreleased information to the Company in October 2007 to enhance the management of unreleased information.

During the reporting period, the above undertakings were regularly performed without any existence of breach.

3.4 Caution and explanation as to the anticipated loss of accumulated net profit from the beginning of the year to the end of the next reporting period or significant changes over the same period of last year

¨  Applicable    x  Not applicable

3.5 Implementation of cash dividend policy during the reporting period

On 29 March 2016, the Company held the tenth meeting of the Seventh Session of the Board of Directors, at which the profit distribution proposal of the Company for 2015 was reviewed and passed. The board of directors proposed payment of a final cash dividend for 2015 of RMB0.08 (including tax) per share to all shareholders based on the total share capital of 7,083,537,000 shares on 31 December 2015, totalling RMB566,682,960. The proposal is subject to approval at the Annual General Meeting of 2015 of the Company to be convened on 26 May 2016.

3.6 Progress on implementation of internal control

During the reporting period, the Company has completed the evaluation of internal control for 2015 in accordance with the relevant requirements of the PRC and overseas securities regulatory authorities for internal control of listed companies and disclosed the Internal Control Evaluation Report for the Year 2015. Price Waterhouse Coopers Zhong Tian LLP has reviewed the effectiveness of the relevant internal control set out in the Company’s financial reporting, and has issued an unqualified audit opinion. The abovementioned reports have been disclosed on the SSE’s website (http://www.sse.com.cn), HKExnews’ website (http://www.hkexnews.hk) and the Company’s website (http://www.gsrc.com).

— 9 —

In 2016, the Company will strive to perfect its internal control system, regulate the implementation of its internal control system and strengthen the supervision and inspection of internal control in accordance with the Basic Standard for Enterprise Internal Control and its implementation guidelines jointly promulgated by five authorities of the PRC, Section 404 of the United States Sarbanes-Oxley Act and the relevant requirements of the PRC or overseas securities regulatory authorities, to promote the healthy and sustainable development of the Company.

Name of Company	Guangshen Railway Company Limited
Legal representative	Wu Yong
Date	27 April 2016

— 10 —

4. APPENDIX

4.1 FINANCIAL STATEMENTS

Combined Balance Sheet

31 March 2016

Prepared by: Guangshen Railway Company Limited	Unit: ¥ Currency: RMB		Audit type: Unaudited
Item	Balance at the end of the period		Balance at the beginning of the period
Current assets:
Bank balances and cash		1,797,449,119		2,326,803,114
Trade receivables		3,295,341,654		2,886,065,085
Prepayments		7,271,093		5,755,865
Interests receivable		2,307,457		2,415,513
Other receivables		138,625,880		118,851,817
Inventories		313,641,664		307,057,807
Other current assets		—		15,590,092
Total current assets		5,554,636,867		5,662,539,293
Non-current assets:
Available-for-sale financial assets		53,825,879		53,825,879
Long-term receivables		31,307,807		30,804,185
Long-term equity investments		170,504,982		168,710,990
Fixed assets		23,752,543,989		24,072,123,391
Constructions-in-progress		552,780,582		569,572,534
Intangible assets		942,352,016		950,161,208
Goodwill		281,254,606		281,254,606
Long-term prepaid expenses		10,907,698		14,485,113
Deferred income tax assets		95,282,750		93,249,259
Other non-current assets		51,555,910		46,545,540
Total non-current assets		25,942,316,219		26,280,732,705
Total assets		31,496,953,086		31,943,271,998

— 11 —

Item	Balance at the end of the period			Balance at the beginning of the period
Current liabilities:
Trade payables		1,929,953,116			2,531,288,960
Receipts in advance		114,673,659			249,825,054
Staff remuneration payable		173,192,091			166,107,393
Tax payable		324,204,828			330,830,918
Dividends payable		14,315,757			14,318,034
Other payables		990,790,524			1,031,280,581
Total current liabilities		3,547,129,975			4,323,650,940
Non-current liabilities:
Deferred income		109,503,075			103,984,771
Deferred income tax liabilities		70,752,998			71,376,179
Total non-current liabilities		180,256,073			175,360,950
Total liabilities		3,727,386,048			4,499,011,890
Owners’ equity:
Share capital		7,083,537,000			7,083,537,000
Capital reserves		11,562,737,107			11,562,737,107
Surplus reserves		2,708,543,178			2,708,543,178
Retained earnings		6,434,259,084			6,107,669,426
Total equity attributable to owners of the parent		27,789,076,369			27,462,486,711
Minority interests		(19,509,331	)		(18,226,603	)
Total owners’ equity		27,769,567,038			27,444,260,108
Total liabilities and owners’ equity		31,496,953,086			31,943,271,998

Chairman: Wu Yong          General Manager: Hu Lingling          Chief Accountant: Tang Xiangdong

Chief of Finance Department: Lin Wensheng

— 12 —

Company Balance Sheet

31 March 2016

Prepared by: Guangshen Railway Company Limited	Unit: ¥ Currency: RMB		Audit type: Unaudited
Item	Balance at the end of the period		Balance at the beginning of the period
Current assets:
Bank balances and cash		1,776,486,743		2,313,739,678
Trade receivables		3,279,610,007		2,880,289,803
Prepayments		7,237,582		5,724,794
Interests receivable		2,160,432		2,289,802
Dividends receivable		14,034,709		4,491,687
Other receivables		180,300,297		158,457,319
Inventories		308,433,890		301,988,956
Other current assets		—		15,840,718
Total current assets		5,568,263,660		5,682,822,757
Non-current assets:
Available-for-sale financial assets		52,108,000		52,108,000
Long-term receivables		31,307,807		30,804,185
Long-term equity investments		253,626,441		251,832,449
Fixed assets		23,646,804,266		23,964,531,346
Constructions-in-progress		551,799,138		568,591,090
Intangible assets		619,946,118		624,922,433
Goodwill		281,254,606		281,254,606
Long-term prepaid expenses		10,592,478		14,088,793
Deferred income tax assets		106,775,946		104,770,117
Other non-current assets		22,079,925		17,069,555
Total non-current assets		25,576,294,725		25,909,972,574
Total assets		31,144,558,385		31,592,795,331

— 13 —

Item	Balance at the end of the period		Balance at the beginning of the period
Current liabilities:
Trade payables		1,891,665,015		2,505,530,208
Receipts in advance		113,165,529		248,092,497
Staff remuneration payable		170,551,501		163,697,570
Tax payable		314,571,831		321,554,729
Dividends payable		13,263		15,540
Other payables		681,735,832		723,124,617
Total current liabilities		3,171,702,971		3,962,015,161
Non-current liabilities:
Deferred income		109,503,075		103,984,771
Total non-current liabilities		109,503,075		103,984,771
Total liabilities		3,281,206,046		4,065,999,932
Owners’ equity:
Share capital		7,083,537,000		7,083,537,000
Capital reserves		11,564,461,609		11,564,461,609
Surplus reserves		2,708,543,178		2,708,543,178
Retained earnings		6,506,810,552		6,170,253,612
Total equity attributable to owners of the parent		27,863,352,339		27,526,795,399
Total liabilities and owners’ equity		31,144,558,385		31,592,795,331

Chairman: Wu Yong          General Manager: Hu Lingling      Chief Accountant: Tang Xiangdong

Chief of Finance Department: Lin Wensheng

— 14 —

Combined Statement of Profit

January to March 2016

Prepared by: Guangshen Railway Company Limited	Unit: ¥ Currency: RMB			Audit type: Unaudited
Item	Amount for the period			Amount for the previous period
I.       Total revenues from operation		4,011,817,621			3,678,860,629
Include:Revenues from operation		4,011,817,621			3,678,860,629
II.     Total operating costs		3,563,541,890			3,317,810,564
Include:Operating costs		3,498,568,795			3,252,229,057
Business tax and surcharges		19,374,235			17,092,730
Selling expenses		1,041,614			1,599,406
Management expenses		50,271,616			56,716,867
Finance costs — net		(5,713,970	)		(9,821,848	)
Assets impairment loss		(400	)		(5,648	)
Add:Gains from investments		1,793,992			2,258,165
Include:Gains from investments in associates		1,793,992			2,258,165
III.    Profit from operation		450,069,723			363,308,230
Add:Non-operating income		1,222,100			1,089,300
Include:Gain on disposal of non-current assets		580			4,527
Less:Non-operating expenses		16,381,897			15,467,368
Include:Loss on disposal of non-current assets		15,954,751			14,299,032
IV.   Gross profit		434,909,926			348,930,162
Less:Income tax expenses		109,602,996			86,691,380
V.     Net profit		325,306,930			262,238,782
Net profit attributable to owners of the parent		326,589,658			262,276,663
Profit or loss of minority shareholders		(1,282,728	)		(37,881	)
VI.   Net other comprehensive income after tax		—			—
VII.  Total comprehensive income:		325,306,930			262,238,782
Total comprehensive income attributable to owners of the parent		326,589,658			262,276,663
Total comprehensive income attributable to minority shareholders		(1,282,728	)		(37,881	)
VIII. Earnings per share:
(1) Basic earnings per share (¥/share)		0.046			0.037
(2) Diluted earnings per share (¥/share)		0.046			0.037

Chairman: Wu Yong          General Manager: Hu Lingling          Chief Accountant: Tang Xiangdong

Chief of Finance Department: Lin Wensheng

— 15 —

Company Statement of Profit

January to March 2016

Prepared by: Guangshen Railway Company Limited	Unit: ¥ Currency: RMB			Audit type: Unaudited
Item	Amount for the period			Amount for the previous period
I.       Revenues from operation		3,899,160,704			3,581,516,246
Less:Operating costs		3,407,304,550			3,178,687,917
Business tax and surcharges		13,680,477			12,246,173
Selling expenses		1,038,814			1,345,273
Management expenses		34,094,146			43,026,085
Finance costs — net		(5,551,960	)		(9,682,874	)
Assets impairment loss		(400	)		(5,648	)
Add:Gains from investments		11,337,014			2,258,165
Include:Gains from investments in associates		1,793,992			2,258,165
II.     Profit from operation		459,932,091			358,157,485
Add:Non-operating income		1,217,616			1,080,728
Include:Gain on disposal of non-current assets		580			4,527
Less:Non-operating expenses		16,346,235			15,450,648
Include:Loss on disposal of non-current assets		15,954,751			14,283,621
III.    Gross profit		444,803,472			343,787,565
Less:Income tax expenses		108,246,532			85,367,750
IV.   Net profit		336,556,940			258,419,815
V.     Total comprehensive income after tax		—			—
VI.   Total comprehensive income:		336,556,940			258,419,815
VII.  Earnings per share:
(1) Basic earnings per share (¥/share)		N/A			N/A
(2) Diluted earnings per share (¥/share)		N/A			N/A

Chairman: Wu Yong          General Manager: Hu Lingling          Chief Accountant: Tang Xiangdong

Chief of Finance Department: Lin Wensheng

— 16 —

Combined Cash Flow Statement

January to March 2016

Prepared by: Guangshen Railway Company Limited	Unit: ¥ Currency: RMB			Audit type: Unaudited
Item	Amount for the period			Amount for the previous period
I.       Cash flows from operating activities:
Cash received from sales of goods or rendering of services		2,928,658,383			3,220,809,751
Cash received relating to other operating activities		9,535,568			23,891,792
Sub-total of cash inflows from operating activities		2,938,193,951			3,244,701,543
Cash paid for goods purchased and services accepted		1,086,470,061			977,673,705
Cash paid to and on behalf of employees		1,447,096,646			1,240,079,757
Tax paid		283,224,794			140,513,638
Cash paid relating to other operating activities		62,369,722			31,357,812
Sub-total of cash outflows from operating activities		2,879,161,223			2,389,624,912
Net cash flows from operating activities		59,032,728			855,076,631
II.     Cash flows from investing activities:
Net cash received from disposal of fixed assets, intangible assets and other long-term assets activities		16,441			—
Sub-total of cash inflows from investing activities		16,441			—
Cash paid to acquire or construct fixed assets, intangible assets and other long-term assets		588,403,164			562,360,970
Net cash paid for acquisition of subsidiaries and other operating units		—			50,936,000
Sub-total of cash outflows from investing activities		588,403,164			613,296,970
Net cash flows from investing activities		(588,386,723	)		(613,296,970	)

— 17 —

Item	Amount for the period			Amount for the previous period
III.    Cash flows from financing activities:
Cash paid for distribution of dividends or profits or payment of interests		—			3,889
Sub-total of cash outflows from financing activities		—			3,889
Net cash flows from financing activities		—			(3,889	)
IV.   Effect of foreign exchange rate changes on cash and cash equivalents		—			—
V.     Net increase in cash and cash equivalents		(529,353,995	)		241,775,772
Add:Balance of cash and cash equivalents at the beginning of the period		2,220,803,114			1,665,056,659
VI.   Balance of cash and cash equivalents at the end of the period		1,691,449,119			1,906,832,431

Chairman: Wu Yong          General Manager: Hu Lingling          Chief Accountant: Tang Xiangdong

Chief of Finance Department: Lin Wensheng

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Company Cash Flow Statement

January to March 2016

Prepared by: Guangshen Railway Company Limited	Unit: ¥ Currency: RMB			Audit type: Unaudited
Item	Amount for the period			Amount for the previous period
I.       Cash flows from operating activities:
Cash received from sales of goods or rendering of services		2,823,817,002			3,123,835,066
Cash received relating to other operating activities		9,383,021			20,071,181
Sub-total of cash inflows from operating activities		2,833,200,023			3,143,906,247
Cash paid for goods purchased and services accepted		1,056,660,468			943,287,444
Cash paid to and on behalf of employees		1,386,604,720			1,196,075,788
Tax paid		274,161,502			133,262,042
Cash paid relating to other operating activities		64,639,545			23,410,311
Sub-total of cash outflows from operating activities		2,782,066,235			2,296,035,585
Net cash flows from operating activities		51,133,788			847,870,662
II.     Cash flows from investing activities:
Cash received from gains from investments		—			6,078,958
Net cash received from disposal of fixed assets, intangible assets and other long-term assets		16,441			—
Sub-total of cash inflows from investing activities		16,441			6,078,958
Cash paid to acquire or construct fixed assets, intangible assets and other long-term assets		588,403,164			562,208,053
Net cash paid for acquisition of subsidiaries and other operating units		—			50,936,000
Sub-total of cash outflows from investing activities		588,403,164			613,144,053
Net cash flows from investing activities		(588,386,723	)		(607,065,095	)

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Item	Amount for the period			Amount for the previous period
III.    Cash flows from financing activities:
Cash paid for distribution of dividends or profits or payment of interests		—			3,889
Sub-total of cash outflows from financing activities		—			3,889
Net cash flows from financing activities		—			(3,889	)
IV.   Effect of foreign exchange rate changes on cash and cash equivalents		—			—
V.     Net increase in cash and cash equivalents		(537,252,935	)		240,801,678
Add:Balance of cash and cash equivalents at the beginning of the period		2,213,739,678			1,659,849,029
VI.   Balance of cash and cash equivalents at the end of the period		1,676,486,743			1,900,650,707

Chairman: Wu Yong          General Manager: Hu Lingling          Chief Accountant: Tang Xiangdong          Chief of Finance Department: Lin Wensheng

4.2 Audit Report

¨  Applicablex  Not applicable

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