China Hengshi Foundation : - 2017 Interim Results Announcement

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CHINA HENGSHI FOUNDATION COMPANY LIMITED

中國恒石基業有限公司

(Incorporated under the laws of Cayman Islands with limited liability)

(Stock code: 1197) INTERIM RESULTS ANNOUNCEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2017 INTERIM RESULTS HIGHLIGHTS

• The revenue of the Group for the six months ended 30 June 2017 was approximately RMB594.0 million (for the six months ended 30 June 2016: approximately RMB613.0 million), representing a decline of approximately 3.10% as compared with that for the same period last year.

• The gross profit of the Group for the six months ended 30 June 2017 was approximately RMB217.7 million (for the six months ended 30 June 2016: approximately RMB203.2 million), representing an increase of approximately 7.14% as compared with that for the same period last year.

• The profit for the period attributable to the owners of the Company during the six months ended 30 June 2017 was approximately RMB104.7 million (for the six months ended 30 June 2016: approximately RMB112.2 million), representing a decline of approximately 6.68% as compared with that for the same period last year.

• The basic earnings per Share attributable to the owners of the Company for the six months ended 30 June 2017 was approximately RMB0.10 (for the six months ended 30 June 2016: approximately RMB0.11).

• The Board did not recommend the payment of interim dividends for the six months ended 30 June 2017 (for the six months ended 30 June 2016: nil).

The board (the "Board") of directors (the "Directors") of China Hengshi Foundation Company Limited (the "Company") is pleased to announce the unaudited consolidated interim results of the Company and its subsidiaries (collectively the "Group") for the six months ended 30 June 2017 (the "Review Period"), together with the comparative figures for the six months ended 30 June 2016 as follows:

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED 30 JUNE 2017

For the six months ended 30 June

Notes	2017 RMB'000 (Unaudited)	2016 RMB'000 (Unaudited)
Revenue	3	594,004	613,031
Cost of sales	(376,255)	(409,853)
Gross profit	217,749	203,178
Other income	4	5,725	16,752
Other gains and losses	5	(6,932)	1,107
Selling and distribution expenses	(50,326)	(36,511)
Administrative expenses	(20,884)	(22,856)
Research expenditure	(16,264)	(18,615)
Other expenses	(811)	(196)
Finance costs	(60)	(4,207)
Profit before tax	6	128,197	138,652
Income tax expense	7	(23,095)	(26,938)
Profit for the period	105,102	111,714

For the six months ended 30 June 2017 2016

Notes RMB'000 RMB'000

(Unaudited) (Unaudited)

Other comprehensive expense

Items that may be subsequently reclassified to profit or loss:

Exchange differences arising on translating foreign

operations	(1,133)		(1,299)
Total comprehensive income for the period	103,969		110,415
Profit (loss) for the period attributable to: Owners of the Company	104,700		112,200
Non-controlling interests	402		(486)
105,102		111,714
Total comprehensive income (expense) for the period attributable to:
Owners of the Company	103,551	111,035
Non-controlling interests	418	(620)
103,969	110,415
Earnings per share - basic (RMB)	9	0.10	0.11

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AT 30 JUNE 2017

Notes	30/06/2017 RMB'000 (Unaudited)	31/12/2016 RMB'000 (Audited)
NON-CURRENT ASSETS Property, plant and equipment	538,348	510,597
Prepaid lease payments	29,645	30,033
Deferred tax assets Deposits paid for acquisition of property, plant and equipment	12,439 108,361	10,538 78,695
688,793	629,863
CURRENT ASSETS Inventories	141,573	126,132
Prepaid lease payments	776	776
Trade and other receivables	10	394,076	386,687
Bills receivables	10	3,570	36,500
Amounts due from related parties	10	13,191	14,401
Pledged bank deposits	39,105	133,603
Bank balances and cash	260,919	269,397
853,210	967,496
CURRENT LIABILITIES Trade and other payables	11	48,055	34,779
Bills payables	11	132,950	271,013
Amounts due to related parties	11	123,937	11,461
Amount due to a shareholder	7	7
Tax payable	9,848	12,579
Bank borrowings	-	50,000
Deferred revenue	300	300
315,097	380,139
NET CURRENT ASSETS	538,113	587,357
TOTAL ASSETS LESS CURRENT LIABILITIES	1,226,906	1,217,220