Xiwang Special Steel : POSITIVE PROFIT ALERT IN RESPECT OF THE THIRD QUARTER OF 2018 AND CERTAIN KEY OPERATING DATA

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XIWANG SPECIAL STEEL COMPANY LIMITED

Гˮत፻Ϟࠢʮ̡

(Incorporated in Hong Kong with limited liability)

(Stock Code: 1266)

POSITIVE PROFIT ALERT IN RESPECT OF

THE THIRD QUARTER OF 2018

AND

CERTAIN KEY OPERATING DATA

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 nine months ended 30 September 2018, which have not been reviewed or audited by the independent auditors and/or the audit committee of the Company, the consolidated profit attributable to the shareholders of the Company for the nine months ended 30 September 2018 is expected to increase by more than 50% as compared with that for the nine months ended 30 September 2017.

The Board also wishes to inform the shareholders of the Company and potential investors about certain unaudited operating data of the Group for the three months ended 30 September 2018.

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).

Positive Profit Alert

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 nine months ended 30 September 2018, which have not been reviewed or audited by the independent auditors and/or the audit committee of the Company, the consolidated profit attributable to the shareholders of the Company for the nine months ended 30 September 2018 is expected to increase by more than 50% as compared to the corresponding period of last year (nine months ended 30 September 2017: approximately RMB573 million (unaudited)).

The increase in the net profit attributable to the shareholders of the Company for the nine months ended 30 September 2018 was due to:

• (1) persistent rise in steel price and moderate increase in raw material price, lead to an increase in our profit margin along with an increase in gross profit of steel.

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

Key Operating Data

The Board is also pleased to announce the unaudited key operating data of the Group for the three months ended 30 September 2018 as follows:

For the three months ended

30 September 2018

(Unaudited)Sales volume of self-manufactured steel products (tonnes)Approximately 756,000

Gross profit per tonne of self-manufactured steel products (RMB)

Approximately 886 per tonneThe 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 reviewed or audited by the Company's auditors and the actual results of the Group may be different from those disclosed in this announcement.

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, 15 October 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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