China Financial International Investments : ANNOUNCEMENT OF ANNUAL RESULTS FOR THE YEAR ENDED 30 JUNE 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.

CHINA FINANCIAL INTERNATIONAL INVESTMENTS LIMITED

中 國 金 融 國 際 投 資 有 限 公 司

(Incorporated in the Cayman Islands and continued in Bermuda with limited liability)

(Stock Code: 721)

ANNOUNCEMENT OF ANNUAL RESULTS

FOR THE YEAR ENDED 30 JUNE 2019

The board (the "Board") of directors (the "Director") of China Financial International Investments Limited (the "Company") is pleased to announce the consolidated results of the Company and its subsidiaries (collectively, the "Group") for the year ended 30 June 2019 (the "Year") together with the comparative figures for the previous year as follows:

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER

COMPREHENSIVE INCOME

For the year ended 30 June 2019

		2019		2018
	NOTES	HK$'000	HK$'000
Revenue	4	68,845		66,797
Other income	6	26,379		1,657
Fair value loss on financial assets at fair value		(209,271)
through profit or loss		(59,768)
Impairment loss on available-for-sale
("AFS") financial assets		-	(15,456)
Impairment loss on debt instruments at fair
value through other comprehensive income
("FVTOCI")		(161,824)	-
Impairment loss on other receivables		(16,037)	-
Administrative expenses		(31,850)	(63,111)
Share of profit of an associate		125		485
Finance costs	7	(3,150)	(3,151)
Loss before tax		(326,783)	(72,547)
Income tax expense	8	(780)	(295)
Loss for the year	9	(327,563)	(72,842)

1

		2019		2018
	NOTE	HK$'000	HK$'000
Other comprehensive (expense) income
Item that will not be reclassified to
profit or loss:
Fair value loss on equity instruments at
FVTOCI		(44,969)	-
Items that may be reclassified subsequently
to profit or loss:
AFS financial assets:
Fair value loss		-	(68,102)
Reclassification adjustment for loss
included in profit or loss		-	15,456
		-	(52,646)
Debt instruments at FVTOCI:
Fair value loss		(156,334)	-
Adjustment for expected credit loss
included in profit or loss		161,824		-
		5,490		-
Exchange difference arising on translation
of foreign operations		(5,246)	6,584
		244		(46,062)
Other comprehensive expense for the year		(44,725)	(46,062)
Total comprehensive expense for the year		(372,288)	(118,904)
Loss for the year attributable to owners
of the Company		(327,563)	(72,842)
Total comprehensive expense for the year
attributable to owners of the Company		(372,288)	(118,904)
LOSS PER SHARE	10
Basic (HK cents)		(2.986)	(0.664)

2

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 30 June 2019

	2019	2018
	HK$'000		HK$'000
NON-CURRENT ASSETS
Property, plant and equipment	491	770
Interest in an associate	1,153	1,028
Financial assets at fair value through
profit or loss	313,408	725,262
Equity instruments at fair value through
other comprehensive income	96,458		-
Available-for-sale financial assets	-	174,407
Deposits	197	157,753
	411,707	1,059,220
CURRENT ASSETS
Prepayments, deposits and other receivables	201,364	34,461
Financial assets at fair value through
profit or loss	214,763	338,559
Debt instruments at fair value through
other comprehensive income	302,234		-
Bank balances and cash	36,124	153,935
	754,485	526,955
CURRENT LIABILITIES
Other payables and accruals	3,518	24,458
Amount due to an associate	114	188
Tax payable	4,200	4,485
Borrowings	9,990		-
Financial guarantee contracts	10,679	33,986
	28,501	63,117
NET CURRENT ASSETS	725,984	463,838
TOTAL ASSETS LESS CURRENT
LIABILITIES	1,137,691	1,523,058

3

		2019	2018
	NOTE	HK$'000			HK$'000
NON-CURRENT LIABILITY
Borrowings		52,985	62,975
NET ASSETS		1,084,706	1,460,083
CAPITAL AND RESERVES
Share capital		109,717	109,717
Reserves		974,989	1,350,366
TOTAL EQUITY		1,084,706	1,460,083
NET ASSET VALUE PER SHARE
(HK cents)	11	9.89	13.31

4

NOTES:

1. GENERAL
   China Financial International Investments Limited (the "Company") was incorporated in the Cayman Islands under the Cayman Islands Companies Law as an exempted company. With effect from 9 May 2006, the Company de-registered from the Cayman Islands and re-domiciled in Bermuda under the Companies Act 1981 of Bermuda as an exempted company. The shares of the Company are listed on The Stock Exchange of Hong Kong Limited (the "Stock Exchange"). The addresses of the registered office and principal place of business of the Company are disclosed in the corporate information section to the annual report.
   The Company and its subsidiaries (the "Group") are principally engaged in investing in listed and unlisted companies established and/or doing businesses in Hong Kong and the People's Republic of China (the "PRC").
   The consolidated financial statements are presented in Hong Kong dollars ("HK$"), which is also the functional currency of the Company.
2. BASIS OF PREPARATION
   In the preparation of the consolidated financial statements, the directors of the Company have given due and careful consideration to the future liquidity of the Group by continuously monitoring forecast and actual cash flows. For the year ended 30 June 2019, the Group reported net cash used in operating activities of HK$115,786,000 and loss for the year of HK$327,563,000. At 30 June 2019, the Group had bank balances and cash of HK$36,124,000 and net current assets of HK$725,984,000. Cash from operating activities is dependent on realisation of the listed and unlisted investments. In order to continue funding future capital programs, the Company may need to obtain additional equity or debt financing, or assess other options. The ability to access the required capital to maintain current financial position and cash flows is dependent on a variety of external factors.
   The consolidated financial statements have been prepared on a going concern basis as, in the opinion of the directors of the Company, the Group has the ability to obtain debt or equity financing, or other sources of funding for future capital programs should the need arise.

5

3. APPLICATION OF NEW AND AMENDMENTS TO HONG KONG FINANCIAL REPORTING STANDARDS ("HKFRSs")

New and amendments to HKFRSs that are mandatorily effective for the current year

The Group has applied the following new and amendments to HKFRSs issued by the Hong Kong Institute of Certified Public Accountants for the first time in the current year:

HKFRS 9	Financial Instruments
HKFRS 15	Revenue from Contracts with Customers and the related
	Amendments
HK(IFRIC) - Int 22	Foreign Currency Transactions and Advance Consideration
Amendments to HKFRS 2	Classification and Measurement of Share-based Payment
	Transactions
Amendments to HKFRS 4	Applying HKFRS 9 "Financial Instruments" with HKFRS 4
	"Insurance Contracts"
Amendments to HKAS 28	As part of the Annual Improvements to
	HKFRSs 2014-2016 Cycle

Except as described below, the application of the new and amendments to HKFRSs in the current year has had no material impact on the Group's financial performance and positions for the current and prior years and/or on the disclosures set out in these consolidated financial statements.

HKFRS 9 "Financial Instruments"

In the current year, the Group has applied HKFRS 9 and the related consequential amendments to other HKFRSs. HKFRS 9 introduces new requirements for 1) the classification and measurement of financial assets and financial liabilities, 2) expected credit losses ("ECL") for financial assets and financial guarantee contracts and 3) general hedge accounting.

The Group has applied HKFRS 9 in accordance with the transition provisions set out in HKFRS 9, i.e. applied the classification and measurement requirements (including impairment under ECL model) retrospectively to instruments that have not been derecognised as at 1 July 2018 (date of initial application) and has not applied the requirements to instruments that have already been derecognised as at 1 July 2018. The difference between carrying amounts as at 30 June 2018 and the carrying amounts as at 1 July 2018 are recognised in the opening accumulated losses and other components of equity, without restating comparative information.

In addition, the Group has applied a practical expedient set out in HKFRS 9 on transition to HKFRS 9, which is to treat the fair value of the Group's debt investments of HK$458,568,000 as at the date of the initial application of HKFRS 9 as the carrying amount of the Group's debt investments classified as FVTOCI upon the application of HKFRS 9 because, in the opinion of the directors of the Company, it is impracticable for the Group to apply retrospectively the effective interest method (including quantifying the amount of ECL).

Accordingly, certain comparative information may not be comparable as comparative information was prepared under HKAS 39 "Financial Instruments: Recognition and Measurement".

6

Summary of effects arising from initial application of HKFRS 9

The table below illustrates the classification and measurement of financial assets and financial liabilities and other items subject to ECL under HKFRS 9 and HKAS 39 at the date of initial application, 1 July 2018.

Financial

Financial

Equity

assets at

assets

Financial

instruments

amortised

Available-

designated

assets at

at fair value

cost

AFS

for-sale

at fair value

FVTPL

through other

(previously

financial

("AFS")

through

required by

comprehensive

Debt

classified as

assets

financial

profit or loss

HKAS 39/

income

instruments

loans and

revaluation

FVTOCI

Accumulated

Notes

assets

("FVTPL")

HKFRS 9

("FVTOCI")

at FVTOCI

receivables)

reserve

reserve

losses

HK$'000

HK$'000

HK$'000

HK$'000

HK$'000

HK$'000

HK$'000

HK$'000

HK$'000

Closing balance at

30 June 2018 - HKAS 39

174,407

725,262

338,559

-

-

345,786

(21,920)

-

(968,951)

Effect arising from initial

application of HKFRS 9:

Reclassification

From AFS

(a)

(174,407)

-

21,601

152,806

-

-

21,920

(25,888)

3,968

From designated at FVTPL

(b)

-

(725,262)

266,694

-

458,568

-

-

-

-

Remeasurement

Impairment under

ECL model

(c)

-

-

-

-

-

(3,089)

-

-

(3,089)

Opening balance at

-

1 July 2018

-

626,854

152,806

458,568

342,697

-

(25,888)

(968,072)

7

1. AFS investments
   From AFS equity investments to FVTOCI
   The Group elected to present in other comprehensive income for the fair value changes of all its equity investments previously classified as AFS. These investments are not held for trading and not expected to be sold in the foreseeable future. At the date of initial application of HKFRS 9, HK$152,806,000 were reclassified from AFS financial assets to equity instruments at FVTOCI. The fair value losses of HK$25,888,000 relating to those investments previously carried at fair value continued to accumulate in FVTOCI reserve.
   From AFS investments to FVTPL
   At the date of initial application of HKFRS 9, the Group's unlisted investments of HK$21,601,000 were reclassified from AFS financial assets to financial assets at FVTPL. The fair value losses of HK$3,968,000 relating to those investments previously carried at fair value were transferred from AFS financial assets revaluation reserve to accumulated losses.
2. Financial assets at FVTPL and/or designated at FVTPL
   At the date of initial application, the Group no longer applied designation as measured at FVTPL for the portfolio of financial assets which is managed and its performance is evaluated on a fair value basis, as these financial assets are required to be measured at FVTPL under HKFRS 9. As a result, these investments of HK$266,694,000 were reclassified from financial assets designated at FVTPL to financial assets at FVTPL.
   The Group's unlisted bonds with a fair value of HK$458,568,000 as at 1 July 2018 were reclassified from financial assets at FVTPL to debt instruments at FVTOCI, as the directors of the Company, after assessing the business model as at the date of the initial application, concluded that such investments are held within a business model whose objective is achieved by both collecting contractual cash flows and selling of these assets and the contractual cash flows of these investments are solely payments of principal and interest on the principal amount outstanding.
   The Group has reassessed its investments in equity securities and derivative financial instrument classified as held for trading under HKAS 39 as if the Group had purchased these investments at the date of initial application. Based on the facts and circumstances as at the date of initial application, HK$338,559,000 of the Group's investments were held for trading and continued to be measured at FVTPL.
3. Impairment under ECL model
   ECL for financial assets at amortised cost, including other receivables and bank balances, are assessed on 12m ECL basis as, in the opinion of the directors of the Company, there had been no significant increase in credit risk since initial recognition.
   All of the Group's debt instruments at FVTOCI are unlisted bonds previously carried at fair value. Based on assessment of the directors of the Company, certain of these investments were credit-impaired as at 1 July 2018.

8

As at 1 July 2018, additional credit loss allowance of HK$3,089,000 has been recognised against accumulated losses. The additional loss allowance is charged against the respective financial asset at amortised cost.

The loss allowance as at 30 June 2018 reconciled to the opening loss allowance as at 1 July

2018 is as follows:

					Financial
					assets at
					amortised
					cost
					HK$'000
	At 30 June 2018 - HKAS 39			-
	Amounts remeasured through opening accumulated losses			3,089
	At 1 July 2018			3,089
4.	REVENUE
			2019		2018
			HK$'000	HK$'000
	Dividend income from:
	Financial assets at FVTPL	28,230		15,172
	AFS financial assets	-	461
			28,230		15,633
	Interest income from:
	Financial assets at FVTPL	1,144		-
	Debt instruments at FVTOCI	39,471		-
	AFS financial assets	-	51,164
			40,615		51,164
			68,845		66,797

5. OPERATING SEGMENTS

Information reported to the executive directors of the Company, being the chief operating decision maker, for the purposes of resource allocation and assessment of segment performance focuses on the type and underlying business of the Group's investments.

Specifically, the Group's reportable segments under HKFRS 8 "Operating Segments" are as follows:

1. Micro-loanservice - equity investments in investees engaged in micro-loan services
2. Real estate and natural gas - equity investments in investees engaged in real estate and natural gas business
3. Investment in fixed income financial assets - debt investments
4. Others - equity investments in investees engaged in clean energy industry, guarantee service, investment and management consultation service and other businesses

No operating segments have been aggregated in arriving at the reportable segments of the Group.

9

Segment revenue and results

The following is an analysis of the Group's results by reportable segments:

						Investment
						in fixed
				Real estate	income
	Micro-loan	and	financial
	service	natural gas	assets	Others	Consolidated
	HK$'000	HK$'000	HK$'000	HK$'000		HK$'000
Year ended 30 June 2019
Segment revenue	-	3,536		39,471		25,838	68,845
Segment loss	(82,002)	(71,710)	(122,353)	(26,185)	(302,250)
Share of profit of an associate										125
Other income										26,379
Impairment loss on other receivables										(16,037)
Finance costs										(3,150)
Central administrative expenses										(31,850)
Loss before tax										(326,783)
Year ended 30 June 2018
Segment revenue	461		12,004		50,014		4,318	66,797
Segment (loss) profit	(42,623)	(33,681)	41,090		26,787	(8,427)
Share of profit of an associate										485
Other income										1,657
Finance costs										(3,151)
Central administrative expenses										(63,111)
Loss before tax										(72,547)

Segment (loss) profit represents the (loss from) profit earned by each segment without allocation of share of profit of an associate, other income, impairment loss on other receivables, finance costs and central administrative expenses.

10

Segment assets and liabilities

The following is an analysis of the Group's assets by reportable segments:

	2019	2018
	HK$'000		HK$'000
Micro-loan service	63,832	165,630
Real estate and natural gas	215,143	389,163
Investment in fixed income financial assets	302,234	438,569
Others	345,654	244,866
Total segment assets	926,863	1,238,228
Unallocated assets	239,329	347,947
Consolidated assets	1,166,192	1,586,175

For the purposes of monitoring segment performance and allocating resources between segments:

• all assets are allocated to reportable segments other than property, plant and equipment, interest in an associate, prepayments, deposits and other receivables and bank balances and cash; and
• no liabilities are allocated to reportable segments.

6. OTHER INCOME

		2019	2018
		HK$'000		HK$'000
	Bank interest income	2,964	1,657
	Reversal of provision for financial guarantee contracts	23,307		-
	Sundry income	108		-
		26,379	1,657
7.	FINANCE COSTS
		2019	2018
		HK$'000		HK$'000
	Interest on borrowings	3,150	3,151

11

8.	INCOME TAX EXPENSE
		2019		2018
		HK$'000	HK$'000
	PRC Enterprise Income Tax:
	Current year	-	295
	Overprovision in prior year	(99)	-
	Withholding tax (Note)	879		-
		780		295

Note: Withholding tax represents withholding tax of 10% in dividend income from the PRC.

On 21 March 2018, the Hong Kong Legislative Council passed The Inland Revenue (Amendment) (No. 7) Bill 2017 (the "Bill") which introduces the two-tiered profits tax rates regime. The Bill was signed into law on 28 March 2018 and was gazetted on the following day. Under the two- tiered profits tax rates regime, the first HK$2,000,000 of profits of the qualifying group entity will be taxed at 8.25%, and profits above HK$2,000,000 will be taxed at 16.5%. The profits of group entities not qualifying for the two-tiered profits tax rates regime will continue to be taxed at a flat rate of 16.5%.

The directors of the Company considered the amount involved upon implementation of the two- tiered profits tax rates regime as insignificant to the consolidated financial statements. Hong Kong Profits Tax is calculated at 16.5% of the estimated assessable profit for both years.

No provision for Hong Kong Profits Tax has been made in the financial statements as the Group has no assessable profits for the year (2018: assessable profit of the Group is wholly absorbed by tax losses brought forward for the year).

Under the Law of the People's Republic of China on Enterprise Income Tax (the "EIT Law") and Implementation Regulation of the EIT Law, the tax rate of the PRC subsidiaries is 25% for both years.

12

9. LOSS FOR THE YEAR

Loss for the year has been arrived at after charging (crediting):

	2019		2018
	HK$'000	HK$'000
Directors' emoluments	6,875		4,625
Other staff:
Salaries and other benefits	6,506		11,360
Contributions to retirement benefits scheme	115		133
Total employee benefits expense	13,496		16,118
Auditor's remuneration
- audit services	638		680
- non-audit services	210		200
Custodian fee	172		267
Depreciation of property, plant and equipment	286		285
Investment management fees	1,518		2,833
(Reversal of) provision for financial guarantee liabilities	(23,307)	33,986

13

10. LOSS PER SHARE

The calculation of the basic loss per share attributable to owners of the Company is based on the following data:

	2019		2018
	HK$'000	HK$'000
Loss for the year attributable to owners of the Company
for the purpose of basic loss per share	(327,563)	(72,842)
Number of shares
	2019		2018
	'000	'000
Weight average number of ordinary shares
for the purpose of basic loss per share	10,971,634		10,971,634

No diluted loss per share for both years were presented as there were no potential ordinary shares in issue for both years.

11. NET ASSET VALUE PER SHARE

The calculation of the net asset value per share is based on the net assets of HK$1,084,706,000 (2018: HK$1,460,083,000) and 10,971,634,000 (2018: 10,971,634,000) issued and fully paid ordinary shares as at 30 June 2019.

14

MANAGEMENT DISCUSSION AND ANALYSIS

The Group was principally engaged in the investments in the listed securities for short and medium term and unlisted investments for medium and long term during the Year.

During the Year, a net loss attributable to owners of the Company amounted to HK$327,563,000 as compared to a loss of HK$72,842,000 for the year ended 30 June 2018. The loss has been partly offset by dividend income from listed investments and an unlisted investment of HK$28,230,000 and the interest income of HK$40,615,000 from the unlisted bond investments and an unlisted convertible bond investment. The loss was mainly attributable to the following reasons:

1. fair value loss of approximately HK$130,230,000 on unlisted investments at
   FVTPL;
2. fair value loss of approximately HK$79,041,000 on listed investments at FVTPL; and
3. impairment loss on debt instruments at FVTOCI of approximately HK$161,824,000.

During the Year, dividend income from investments increased by 80.58% to HK$28,230,000 as compared to HK$15,633,000 in last year. Interest income from unlisted investments amounted to HK$40,615,000 (2018: HK$51,164,000). The other income which comprised bank interest income, reversal of provision for financial guarantees and sundry income amounted to HK$26,379,000, representing a increase of 1,491.97% as compared to HK$1,657,000 in last year. Administrative and other expenses decreased by 49.53% from HK$63,111,000 in last year to HK$31,850,000 this year mainly due to the decrease of the provision for financial guarantees, staff costs and professional fees.

LISTED INVESTMENT REVIEW

During the Year, the Group recorded the total loss of HK$113,101,000 on listed securities business as compared to a loss of HK$46,910,000 last year. Dividend income of HK$5,918,000 from listed investments was recorded for the Year (2018: HK$15,172,000).

As at 30 June 2019, the market value of the listed securities amounted to HK$285,503,000 (2018: HK$440,319,000), all the listed investments were listed on the Stock Exchange.

15

Listed Securities Portfolio

								% to the
						Dividend	Group's
				Market		received/	net assets
			Group's	value at		receivable	as at
		Number of	effective	30 June		during	30 June	Investment	Disposal	Realized
Name of listed securities	Nature of business	shares held	interest	2019		the Year	2019	cost	consideration	gain/(loss)
				HK$'000		HK$'000		HK$'000	HK$'000	HK$'000
Hidili Industry	Coal mining and	12,369,000	0.6%	3,340		-	0.31%	-	-	-
International	manufacture and sale of
Development Limited	clean coal
China City Infrastructure	Infrastructure businesses,	698,079,429	22.32%	188,482		-	17.38%	-	-	-
Group Limited ("China City	property investment,
Infrastructure")	property development,
	hotel business, property
	management and natural
	gas in the PRC
Sino-Ocean Group	Investment holding,	8,055,000	0.11%	26,661	3,536	2.46%	87,923	92,240	4,317
Holding Limited	property development
	and property investment
	in the PRC
China Communications	infrastructure construction,	9,588,000	0.22%	67,020	2,382	6.18%	-	-	-
Construction Co. Ltd.	infrastructure design,
	dredging and other
	businesses
				285,503	5,918				4,317

UNLISTED INVESTMENT REVIEW

For the year ended 30 June 2019, the total loss on the Group's unlisted investment portfolio recorded as HK$297,473,000 (2018: HK$80,960,000). The loss was mainly attributable to the decrease in fair value of small loan companies and investments in fixed income financial assets. During the Year, dividend income of HK$22,312,000 from a unlisted investment, Henan Tianguan Energy and Biotechnology Company Limited ("Henan Tianguan"), was recorded (2018: HK$461,000).

As at 30 June 2019, the fair value of the Group's unlisted investments amounted to HK$641,360,000 as compared to HK$797,909,000 in last year, representing a 19.62% decrease.

16

UNLISTED EQUITY INVESTMENTS AND UNLISTED CONVERTIBLE BOND INVESTMENT

The company's unlisted equity investments are mainly concentrated on small loan companies and clean energy industry in the PRC.

Since 2018, the Group focusing on clean energy industry and made several investments. Bioenergy is a carbon neutral and renewable energy source that reducing greenhouse gas emissions. Biofuels such as ethanol and biodiesel, are less toxic and are biodegradable. Using biomass can help build resilience in agricultural, timber and food-processing industries. Bioenergy provides a use for their waste streams, can help them reduce their energy costs.

Meanwhile, small loan industry in the PRC is still facing worries of the decreasing interest rate of private lending and the increase of operation risks, resulting in certain small loan companies continue to generate overdue loans and incur losses. In view of the slipping performance of the small loan industry, the company has plan to exit the investments in small loan industry.

In the foreseeable future, the company will continuously focus its investment on the bioenergy sector and gradually exit the past investment in the small loan industry which aim to maximize value of the shareholders of the company.

17

Unlisted equity investment and unlisted convertible bond investment portfolio

									% to
				Group's					the Group's
							Fair value	net assets
				effective				at 30 June	as at 30 June
Name of company	Notes	Location	interest	Business nature	Cost	2019	2019
						HK$'000		HK$'000
Micro-loan services
1	Jingdezhen CFI Guosen	(1)	Jingdezhen, Jiangxi	40%	Provision of small loan and	188,690	516	0.05%
	Microfinance Co., Ltd.		Province		financial consultation services
	("Jingdezhen CFI Guosen")
2	Tianjin Rongshun		Tianjin	30%	Provision of small loan and	36,606	1,799	0.17%
	Microfinance Limited				financial consultation services
3	TIIC RongShun Micro-Loan		Tianjin	10%	Provision of small loan and	12,189	4,344	0.40%
	Company Limited				financial consultation services
4	Harbin Zhongjinguoxin	(2)	Harbin, Heilongjiang	30%	Provision of small loan and	36,693		-	-
	Microfinance Co., Ltd.		Province		financial consultation services
	("Harbin Zhongjinguoxin")
5	Tianjin Binlian		Tianjin	3.3%	Provision of small loan and	12,271	1,193	0.11%
	Microfinance Limited				financial consultation services
6	Ezhou Zhongjinguotou	(3)	Ezhou, Hubei	50%	Provision of small loan and	185,000	20,439	1.88%
	Microfinance Limited		Province		financial consultation services
	("Ezhou Zhongjinguotou")
7	Ziyang Yanjiang CFI GuoSen		Ziyang, Sichuan	30%	Provision of small loan and	73,730	141	0.01%
	Microfinance Co., Ltd.		Province		financial consultation services
8	Nanjing Jiangning		Nanjing, Jiangsu	30%	Provision of small loan and	36,673	11,041	1.02%
	MingYangRongTong		Province		financial consultation service
	Agricultural Microfinance
	Co., Ltd.
9	Tianjin Rongyang		Tianjin	30%	Provision of small loan and	36,741	10,679	0.98%
	Micro-Loan Limited				financial consultation services
10	Zhenjiang CFI Guosen		Zhenjiang, Jiangsu	30%	Provision of small loan and	56,874	13,680	1.26%
	Technology Microfinance		Province		financial consultation service
	Corporation Limited
					Sub-total:	675,467	63,832
Guarantee Service
11	Jiangxi Huazhang Hanchen	(4)	Nanchang, Jiangxi	2.98%	Provision of financing guarantees	43,150	25,202	2.32%
	Guarantee Group Limited		Province		to small and medium enterprises
	("Jiangxi Huazhang")				("SME")
Investment and management consultation service
12	Shenzhen Zhongtoujinxin Asset		Shenzhen,	30%	Provision of consultation services	18,350		-	-
	Management Company		Guangdong Province		on project investments
	Limited
13	Xi'an Kairong Financial		Xi'an, Shaanxi	30%	Provision of financial management	18,724	7,251	0.67%
	Service Limited		Province		services
14	Hubei Zhongjin Tech Financial		Wuhan, Hubei	30%	Provision of financial management	19,030	4,117	0.38%
	Services Co., Ltd.		Province		services
					Sub-total:	56,104	11,368

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								% to
				Group's				the Group's
						Fair value	net assets
				effective			at 30 June	as at 30 June
Name of company	Notes	Location	interest Business nature	Cost	2019	2019
					HK$'000		HK$'000
Clean energy
15	Henan Tianguan	(5)	Henan Province	30% Production and sales of denatured	230,763	187,524	17.29%
				fuel ethanol, sales of acetone,
				butanol, polyols, production
				and sales of biodegradable
				plastics and biodiesel, sales of
				chemical products, wheat bran
				flour, feed sales, acetic acid and
				acetaldehyde production
16	Hunan South China New	(6)	Hunan Province	New energy technologies	51,200	51,200	4.72%
	Energy Limited			development, transfer and
	("South China New Energy")			consultation, research and
				development, manufacturing
				and sales of chemical products,
				chemical reagents and
				auxiliaries (excluding hazardous
				chemicals and precursor
				chemicals)
				Sub-total:	281,963	238,724
				Total:	1,056,684	339,126

Notes:

1. On 1 June 2016, the Group's equity interests in Jingdezhen CFI Guosen changed from 30% to 40% due to previous shareholders of Jingdezhen CFI Guosen withdrew their capital commitment in the sum of RMB125,000,000 in Jingdezhen CFI Guosen and the registered capital of Jingdezhen CFI Guosen was reduced from RMB500,000,000 to RMB375,000,000. Due to the reduction in the registered capital, the shareholding of the Company in Jingdezhen CFI Guosen inevitably and automatically increased from 30% to 40%. In order to comply with Rule 21.04(3)(a) of the Rules Governing the Listing of Securities on the Stock Exchange (the "Listing Rules"), the Company voluntarily relinquished the voting rights beyond 30%.
   Given that the reduction in the registered capital of Jingdezhen CFI Guosen is beyond the control of the Company, the Company is in the passive role in respect of its increase in the shareholdings in Jingdezhen CFI Guosen. The relinquishment of the voting rights is an interim arrangement and the Company still possesses other rights such as the rights to receive dividends. The Directors consider that the relinquishment of the voting rights arrangement is in the interest of the Company and its shareholders as a whole.
   The Company is now actively seeking potential buyers to dispose of the additional non-voting shareholdings in Jingdezhen CFI Guosen or to restore the shareholdings in Jingdezhen CFI Guosen to 30%.
2. On 22 December 2016, the Company entered into a disposal agreement to dispose of all of its equity interest in Harbin Zhongjinguoxin to an independent third party for a cash consideration of RMB25,000,000. A deposit of HK$2,500,000 has been received which was included in receipt in advance under current liabilities as at 30 June 2018 and 2017. As at the date of this announcement, this disposal transaction has not been completed. The Directors expect this disposal transaction will be completed within one year.

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1. On 18 December 2016, the shareholders' resolution of Ezhou Zhongjinguotou approved some existing shareholders of Ezhou Zhongjinguotou to withdraw their capital commitment in the sum of RMB200,000,000 in Ezhou Zhongjinguotou so that the registered capital of Ezhou Zhongjinguotou will be reduced from RMB500,000,000 to RMB300,000,000. Due to the reduction in the registered capital, the shareholding of the Company in Ezhou Zhongjinguotou will inevitably increase from 30% to 50%. In order to comply with Rule 21.04(3)(a) of the Listing Rules, the Company shall voluntarily relinquished the voting rights beyond 30%.
   Given that the reduction in the registered capital of Ezhou Zhongjinguotou is beyond the control of the Company, the Company is in the passive role in respect of its increase in the shareholdings in Ezhou Zhongjinguotou. The relinquishment of the voting rights is an interim arrangement and the Company still possesses other rights such as the rights to receive dividends. The Directors consider that the relinquishment of the voting rights arrangement is in the interest of the Company and its shareholders as a whole.
   The Company is now actively seeking potential buyers to dispose of the additional non-voting shareholdings in Ezhou Zhongjinguotou or to restore the shareholdings in Ezhou Zhongjinguotou to 30%.
2. On 13 April 2011, the Group acquired a 30% equity interest of Jiangxi Huazhang, a joint venture establish in the PRC. The Group's equity interest in Jiangxi Huazhang became 7.2% on 15 July 2013 and reduce to 2.98% on 19 August 2016, as Jiangxi Huazhang was enlarged by the new registered capital subscribed by its other shareholders on these dates.
3. On 11 May 2018, the Company entered into the joint venture agreement with the joint venture partners in relation to the formation of the Henan Tianguan in Henan province, the PRC. Pursuant to the joint venture agreement, the Company owned 30% of the registered capital of the Henan Tianguan. On 31 July 2018, Henan Tianguan increased the registered capital from RMB300,000,000 to RMB660,000,000 hence Keyi (Shanghai) Investments Limited ("Keyi") and Joy State Holdings Limited, wholly-owned subsidiaries of the Company, further injected RMB30,000,000 and RMB78,000,000 respectively.
4. In January 2019, Keyi entered into an agreement with South China New Energy to inject capital contribution of RMB45,000,000 into South China New Energy for acquiring 30% of South China New Energy's equity interest. On 23 January 2019, the legal title of 30% equity interest in South China New Energy has been successfully transferred to Keyi.

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UNLISTED BOND INVESTMENTS

The Group invested four bonds during the Year for the purpose of engaging in the medium term investments and earning the stable return. The details of the bond investments are as follows:

						% to
						the Group's
					Fair value	net assets
					at 30 June	as at 30 June
Name of company	Notes	Business nature	Cost	2019	2019
			HK$'000	HK$'000
Hollys (China) Limited	(1)	Engaged in coffee shop	200,000		124,200	11.45%
("Hollys")		franchise in the PRC
Pure Unity Investments Limited	(2)	Investment company	190,000		84,584	7.80%
("Pure Unity")		which investing equity
		securities, convertible
		notes, preference shares,
		options, warrants or
		debt securities issued by
		both listed and unlisted
		companies
Talent Trend Global Limited	(3)	Investment company	160,000		74,425	6.86%
("Talent Trend")		which investing equity
		securities, convertible
		notes, preference shares,
		options, warrants or
		debt securities issued by
		both listed and unlisted
		companies
Xing Yue Investments Limited	(4)	Investment company	20,000		19,025	1.75%
("Xing Yue")		which investing equity
		securities issued by listed
		companies in Hong Kong
			570,000		302,234

Notes:

1. The Company through its direct wholly-owned subsidiary, Joy State Holdings Limited ("Joy State"), entered into a subscription agreement dated 8 September 2016 as subscriber with Hollys as issuer and Mr. Xiao Yan as guarantor, in relation to the subscription of the 9% secured three-year bond with the principal amount of HK$200,000,000. Mr. Xiao Yan is the sole shareholder and the sole director of Hollys. The bond is secured by 100% unlisted equity interest in Hollys pledged to the Group by Mr. Xiao Yan.
   During the year ended 30 June 2019, Hollys did not pay to the Group 9% contractual interest which was due on 31 December 2018 and 30 June 2019. Up to the date when the consolidated financial statements for the year ended 30 June 2019 were authorised for issue, the outstanding interest receivable has not yet been settled. An event of default is therefore considered to have occurred and the bond is considered as credit-impaired.

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1. The Company through its direct wholly-owned subsidiary, China Financial International Investments (Nanchang) Limited, entered into a subscription agreement dated 21 November 2016 as subscriber with Pure Unity as issuer and Mr. Zhu Mingliang as guarantor, in relation to the subscription of the 9% secured three-year bond with the principal amount of HK$200,000,000. As at 30 June 2019, Mr. Feng Xin is the sole shareholder and the sole director of Pure Unity. Pure Unity has redeemed HK$10,000,000 during the year ended 30 June 2017. The bond is secured by 760,000,000 shares of the Company held by Pure Unity as irrevocable guarantee.
   During the year ended 30 June 2019, Pure Unity did not pay to the Group 9% contractual interest which was due on 31 December 2018 and 30 June 2019. Up to the date when the consolidated financial statements for the year ended 30 June 2019 were authorised for issue, the outstanding interest receivable has not yet been settled. An event of default is therefore considered to have occurred and the bond is considered as credit-impaired.
2. The Company through its direct wholly-owned subsidiary, China Financial International Investments (Henan) Limited as subscriber, entered into a subscription agreement dated 21 November 2016 as subscriber with Talent Trend as issuer and Mr. Huang Xianli as guarantor, in relation to the subscription of the 9% secured three-year bond with the principal amount of HK$160,000,000. As at 30 June 2019, Mr. Feng Xu is the sole shareholder and the sole director of Talent Trend. The bond is secured by unlisted equity interests and by 640,000,000 shares of the Company held by Talent Trend as irrevocable guarantee.
   During the year ended 30 June 2019, Talent Trend did not pay to the Group 9% contractual interest which was due on 31 December 2018 and 30 June 2019. Up to the date when the consolidated financial statements for the year ended 30 June 2019 were authorised for issue, the outstanding interest receivable has not yet been settled. An event of default is therefore considered to have occurred and the bond is considered as credit-impaired.
3. The Company entered into a subscription agreement dated 8 March 2018 as subscriber with Xing Yue as issuer and Ms. Dong Lili as guarantor, in relation to the subscription of the 9% secured three months bond with the principal amount of HK$20,000,000. Ms. Dong Lili is the sole shareholder and the sole director of Xing Yue. The bond is secured by unlisted equity interests and by 200,000,000 shares of the Company which 100,000,000 held by Xing Yue and 100,000,000 held by Rightfirst Holdings Limited ("Rightfirst") as irrevocable guarantee, respectively. Rightfirst is beneficially owned by Mr. Du Lin Dong, who is the executive Director of the Company. The bond was already overdue as at 30 June 2019 and the management is under negotiation with Xing Yue for settlement of the bond.

PROSPECT

The Company is expected to continue to focus on China's bioethanol sector with the aim to maximize value for the shareholders of the company.

China plans to mandatorily promote the use of ethanol in gasoline (E10 gasoline) nationally by the end of 2020. Based on the expected motor gasoline consumption, the annual supply of bioethanol is approximately 13 million metric tons in 2020.

22

In this year, the Company has continuously invested in bioethanol sector in mainland China as well as some strategic adjustments in company's investment portfolio. The Company acquired 30% equity interest of Hunan South China New Energy Limited to build an ethanol biofuel mixing facility in Hunan province, which will give us a strategic asset that can cover future delivery of key regions across central China. Moreover, the Company is also planning to start ethanol business in more areas in China such as Guangdong Province, Hebei Province and Hubei Province.

As the Group's business is moving forward towards its strategic goals, the Board will carefully assess and minimize potential risks and strive to generate more returns to all shareholders.

LIQUIDITY, FINANCIAL RESOURCES AND GEARING

As at 30 June 2019, the Group had cash and cash equivalents of HK$36,124,000 (2018: HK$153,935,000). Majority of the cash and bank balances denominated in Hong Kong dollars, United States dollars and Renminbi are placed with banks in Hong Kong and the PRC. The current ratio (calculated as the current assets to the current liabilities) of the Group as at 30 June 2019 was approximately 26.47 times (2017: 8.35 times), gearing ratio (total liabilities to total assets) of the Group as at 30 June 2019 was approximately 6.99% (2018: 7.95%).

The Group did not have any bank borrowing as at 30 June 2019 (2018: Nil).

FINAL DIVIDEND

The Directors do not recommend the payment of a final dividend for the Year (2018: Nil).

CAPITAL STRUCTURE

As at 30 June 2019, the Group's shareholders' equity and total number of shares in issue for the Company stood at HK$1,084,706,000 (2018: HK$1,460,083,000) and approximately 10,971,634,000 (2018: 10,971,634,000), respectively.

EXPOSURE TO FLUCTUATIONS IN EXCHANGE RATES

Hong Kong dollars and Renminbi are the main currencies of the Group to carry out its business transactions. During the Year, transactions in Renminbi were not significant, the Board considers that the Group's exposure to fluctuation in exchange rates was insignificant.

EMPLOYEES AND REMUNERATION POLICY

As at 30 June 2019, the Group had 14 (2018: 11) employees (including Directors). The total staff costs (including Directors' remuneration) of the Group for the Year was HK$13,496,000 (2018: HK$16,118,000). The remuneration package of the employees is determined by various factors including the employees' experience and performance, the market condition, industry practice and applicable employment law.

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PURCHASES, 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.

AUDIT COMMITTEE

The audit committee of the Company (the "Audit Committee") is principally responsible for reviewing and supervising the Group's financial reporting process and internal control system and providing advice and recommendations to the Board. The Audit Committee comprises three independent non-executive Directors. The Audit Committee has met with the external auditors of the Group to review the accounting principles and practices adopted by the Group and discussed auditing and financial reporting matters including the review of this announcement and financial statements of the Group for the Year.

CORPORATE GOVERNANCE

The Board is committed to maintain good corporate governance standard and procedures to ensure the integrity, transparency and quality of disclosure in order to enhance the Shareholders' value.

During the Year, the Company has applied the principles and complied with the Corporate Governance Code (the "CG Code") contained in Appendix 14 to the Listing Rules, save for the disclosure below:

1. The code provision A.2.1 of the CG Code stipulates that the roles of chairman and chief executive officer should be separated and should not be performed by the same individual. The positions of both chairman and chief executive officer of the Company have been held by Mr. Du Lin Dong during the Year. Given the Group's current stage of development, the Board considers that this structure will not impair the balance of power and authority between the Board and the management of the Company. Mr. Du Lin Dong possesses the essential leadership skills to manage the Board and extensive knowledge in the business of the Group. The Board considers the present structure is more suitable for the Company because it can promote the efficient formulation and implementation of the Company's strategies.

DIRECTORS' SECURITIES TRANSACTION

The Company has adopted the Model Code for Securities Transaction by Directors of Listed Issuers (the "Model Code") as set out in Appendix 10 to the Listing Rules as its own code of conduct regarding directors' securities transactions. Having made specific enquiry by the Company, all Directors have confirmed that they have fully complied with the Model Code throughout the Year.

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EVENTS AFTER THE REPORTING PERIOD

On 22 August 2019, Keyi (Shanghai), a wholly-owned subsidiary of the Company, has entered into an agreement with 3 partners in relation to the formation of Henan Keyi Hui Rui Bioenergy Technology Co., Ltd ("Keyi Hui Rui"). The registered capital of Keyi Hui Rui will be RMB350,000,000. Pursuant to the agreement, Keyi (Shanghai), Partner A, Partner B and Partner C will subscribe for 30%, 25%, 25% and 20% of equity interests of Keyi Hui Rui for a cash consideration of RMB105,000,000, RMB87,500,000, RMB87,500,000 and RMB70,000,000 respectively.

CLOSURE OF REGISTER OF MEMBERS

The annual general meeting of the Company is scheduled to be held on Friday, 6 December 2019. For determining the entitlement to attend and vote at the annual general meeting, the register of members of the Company will be closed from Tuesday, 3 December 2019 to Friday, 6 December 2019 (both days inclusive), during which period no share transfers will be registered. In order to be eligible to attend and vote at the above annual general meeting, all transfer forms accompanied by relevant share certificates must be lodged with the Company's branch share registrar in Hong Kong, Tricor Tengis Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong for registration no later than 4:30 p.m. on Monday, 2 December 2019.

REVIEW OF FINANCIAL STATEMENTS

The consolidated financial statements of the Group for the Year including the accounting principles and practices adopted by the Group have been reviewed by the Audit Committee of the Company and audited by the auditor of the Group, Moore Stephens CPA Limited.

PUBLICATION OF ANNUAL RESULTS ON THE WEBSITES

This results announcement is published on the websites of the Company (http://www. irasia.com/listco/hk/cfii) and the Stock Exchange (www.hkex.com.hk). The annual report will be dispatched to the Shareholders and made available on the above websites as soon as practicable.

By order of the Board

China Financial International Investments Limited

Du Lin Dong

Chairman and Chief Executive Officer

Hong Kong, 27 September 2019

As at the date of this announcement, the executive Director is Mr. Du Lin Dong, the non-executive Directors are Mr. Ding Xiaobin, Mr. Zhang Huayu, Ms. Li Jie and Ms. Chen Xi and the independent non-executive Directors are Mr. Zhang Jing, Mr. Zeng Xianggao and Mr. Li Cailin.

25