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.

XIWANG SPECIAL STEEL COMPANY LIMITED

Гˮत፻Ϟࠢʮ̡

(Incorporated in Hong Kong with limited liability)

(Stock Code: 1266)

POSITIVE PROFIT ALERT

This announcement is made by the Company pursuant to Rule 13.09(2) of the Listing Rules and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong).

The Board wishes to inform the shareholders of the Company and potential investors that based on the preliminary assessment of the unaudited consolidated management accounts of the Group for the six months ended 30 June 2018, which have not been reviewed or audited by the independent auditors and/or the audit committee of the Company, it is expected that the Group's consolidated profit attributable to the shareholders of the Company for the six months ended 30 June 2018 may increase approximately by more than 80% as compared with that for the six months ended 30 June 2017.

Shareholders and potential investors are advised to exercise caution in dealing in the securities of the Company.

This announcement is made by Xiwang Special Steel Company Limited (the "Company", and together with its subsidiaries, the "Group") pursuant to Rule 13.09(2) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules") and Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong).

The board (the "Board") of directors ("Directors") of the Company wishes to inform the shareholders of the Company (the "Shareholders") and potential investors that based on the preliminary assessment of the unaudited consolidated management accounts of the Group for the six months ended 30 June 2018, which have not been reviewed or audited by the independent auditors and/or the audit committee of the Company, it is expected that the Group's consolidated profit attributable to the shareholders of the Company for the six months ended 30 June 2018 may increase approximately by more than 80% as compared with that for the six months ended 30 June 2017.

The increase in the consolidated net profit attributable to the shareholders of the Company for the six months ended 30 June 2018 was mainly due to the following factors:

  • (1) on the supply side, the favourable government policies on prohibiting the use of intermediate frequency furnace and on alleviating overcapacities of the steel industry have resulted in a significant decrease in production capacities of certain steel enterprises. Meanwhile, the national supervision on environmental inspection has been strengthened and certain enterprises which failed to meet the environmental standards were ordered to close down, leading to a decrease in steel supply;

  • (2) on the demand side, the approval by the government on numerous infrastructure projects, frequent construction activities and steady demand from the property development industry have caused the demand on steel to increase further and the steel price to rise persistently;

  • (3) factors, such as, persistent rise in steel price, moderate increase in raw material price, lead to an increase in our profit margin along with an increase in gross profit of steel; and

  • (4) decrease in income tax expense due to recognition as a High and New Technology Enterprise and increase in government subsidy.

The Company is in the course of finalising the interim results of the Group for the six months ended 30 June 2018. The information contained in this announcement is only a preliminary assessment by the management of the Company based on the unaudited consolidated financial statements of the Group, which have not been confirmed, reviewed or audited by the Company's auditors and the actual results for the Group may be different from those disclosed in this announcement.

Details of the interim results of the Group for the six months ended 30 June 2018 are expected to be announced in August 2018. Shareholders and potential investors should read the Group's interim results carefully.

Shareholders and potential investors are advised to exercise caution in dealing in the shares of the Company.

By order of the Board of

Xiwang Special Steel Company Limited

Mr. WANG Di

Chairman

Hong Kong, 16 July 2018

As at the date of this announcement, the Board comprises the following Directors:

Executive Directors

Independent non-executive Directors

Mr. ZHANG Jian

Mr. LEUNG Shu Sun Sunny

Mr. SUN Xinhu

Mr. LI Bangguang

Ms. LI Hai Xia

Mr. YU Kou

Non-executive Directors

Mr. WANG Di

Mr. WANG Yong

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Xiwang Special Steel Company Limited published this content on 16 July 2018 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 16 July 2018 05:09:06 UTC