China Railway : RESULTS ANNOUNCEMENT FOR THE YEAR OF 2020

March 30, 2021 at 10:47 am EDT

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.

中國中鐵股份有限公司

CHINA RAILWAY GROUP LIMITED

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 390)

RESULTS ANNOUNCEMENT FOR THE YEAR OF 2020

The board of directors (the "Board" or "Board of Directors") of China Railway Group Limited (the "Company" or "China Railway") is pleased to announce the audited results of the Company and its subsidiaries (the "Group") for the year ended 31 December 2020.

1 CORPORATE INFORMATION Basic Information

Stock Name:	China Railway (A Share)	China Railway (H Share)
Stock Code:	601390	390
Stock Exchange on	Shanghai Stock Exchange	The Stock Exchange of
which Shares are Listed:		Hong Kong Limited
Registered Address:	918, Block 1, No. 128, South 4th Ring Road West,
	Fengtai District, Beijing, People's Republic of China
Postal Code:	100070
Website:	www.crec.cn
E-mail:	ir@crec.cn
Contact Details
Name:	He Wen
Address:	Block A, China Railway Square, No. 69 Fuxing Road,
	Haidian District, Beijing, People's Republic of China
Postal Code:	100039
Telephone:	86-10-5187 8413
Facsimile:	86-10-5187 8417
E-mail:	ir@crec.cn

2 SUMMARY OF ACCOUNTING DATA

2.1 Key Accounting Data Prepared under International Financial Reporting Standard ("IFRS")

2.1.1 Summary of consolidated income statement

			For the year ended 31 December			Change
					2020 vs
	2020		2019		2018	2017	2016	2019
					RMB million					(%)
Revenue
Infrastructure Construction	876,310		762,084		646,914	611,095	559,223	15.0
Survey, Design and
Consulting Services	17,321	17,031	15,095	13,761	12,312	1.7
Engineering Equipment and
Component Manufacturing	29,793	24,322	20,787	18,521	17,063	22.5
Property Development	49,763	43,662	43,991	30,951	32,976	14.0
Other Businesses	74,183	70,402	67,730	53,074	42,671	5.4
Inter-segment Eliminations and
Adjustments	(72,638)	(66,658)	(54,134)	(38,629)	(31,389)

Total	974,732		850,843			740,383	688,773	632,856	14.6

Gross Profit	90,352		79,864		71,658	62,729	49,789	13.1
Profit before Tax	35,612	33,187	24,945	20,828	18,772	7.3
Profit for the Year	27,250	25,379	17,436	14,204	12,703	7.4
Profit for the Year attributable


to Owners of the Company	25,188		23,678		17,198	16,067	12,509	6.4


Basic Earnings per Share (RMB)	0.963		0.950		0.718	0.669	0.517	1.4

2.1.2 Summary of consolidated balance sheet
			As at 31 December			Change
					2020 vs
	2020		2019	2018		2017	2016	2019
				RMB million				(%)
Assets
Current Assets	742,107		709,770	652,040		641,668	595,147	4.6
Non-current Assets	457,870	346,271	290,473	202,254	159,198	32.2

Total Assets	1,199,977		1,056,041	942,513		843,992	754,345	13.6
Liabilities

Current Liabilities	705,145		676,034	622,475		579,303	506,603	4.3
Non-current Liabilities	181,786	134,679	98,057	95,061	98,746	35.0

Total Liabilities	886,931		810,713	720,532		674,364	605,349	9.4


Total Equity	313,046		245,328		221,981		169,558	148,996	27.6

Total Equity and Liabilities	1,199,977		1,056,041	942,513		843,992	754,345	13.6

2.2 Differences between Chinese Accounting Standard ("CAS") and IFRS

			Profit for
	Net Assets	the year
	as at	ended
	31 December	31 December
	2020		2020
	RMB million	RMB million
Amount attributable to the shareholders of the parent
company stated in the financial statements
prepared in accordance with CAS	255,345		25,188
Adjustments as required by IFRS:
- Recognition of loss on shares conversion scheme
of a subsidiary	(148)	-
Amount attributable to the owners of the Company

stated in the financial statements prepared in
accordance with IFRS	255,197		25,188

3 CHANGES IN SHARE CAPITAL AND INFORMATION ON SHAREHOLDERS 3.1 Changes in Shares

3.1.1 Changes in shares

During the Reporting Period, there have been no changes in respect of the total number of shares and the share equity structure of the Company.

Explanation on changes in shares Not applicable
Impacts of changes in share on the financial indicators of earnings per share, net assets per share for the most recent year and the most recent period

Not applicable

3.1.4 Other contents that the Company deems necessary or required by the securities regulatory authority to be disclosed

Not applicable

3.2 Changes in Shares with Selling Restrictions

								Unit: Shares
				Number	Increase in
		Number	of shares	the number	Number
		of shares	released	of shares	of shares
		with selling	from selling	with selling	with selling		Date of
	restrictions at	restrictions	restrictions	restrictions		releasing
		the beginning	during	during	at the end	Reasons for	selling
Name of shareholder		of the year	the year	the year	of the year	selling restrictions	restrictions
China Reform Holdings	387,050,131	387,050,131	0	0	Selling restrictions	2020.9.21
Corporation Ltd.								imposed by non-public
								issuance of A shares
China Great Wall Asset	372,192,507	372,192,507	0	0	Selling restrictions	2020.9.21
Management Co., Ltd.								imposed by non-public
								issuance of A shares
China Orient Asset	223,271,744	223,271,744	0	0	Selling restrictions	2020.9.21
Management Co., Ltd.								imposed by non-public
								issuance of A shares
China Structural Reform	223,296,399	223,296,399	0	0	Selling restrictions	2020.9.21
Fund Corporation								imposed by non-public
Limited								issuance of A shares
Suida (Jiaxing) Investment	178,138,508	178,138,508	0	0	Selling restrictions	2020.9.21
Partnership (LLP)								imposed by non-public
								issuance of A shares
BOC Financial Asset	119,095,464	119,095,464	0	0	Selling restrictions	2020.9.21
Investment Co., Ltd.								imposed by non-public
								issuance of A shares
China Cinda Asset	74,715,953	74,715,953	0	0	Selling restrictions	2020.9.21
Management Co., Ltd.								imposed by non-public
								issuance of A shares
ICBC Financial Asset	74,433,517	74,433,517	0	0	Selling restrictions	2020.9.21
Investment Co., Ltd.								imposed by non-public
								issuance of A shares
BOCOM Financial Asset	74,433,517	74,433,517	0	0	Selling restrictions	2020.9.21
Investment Co., Ltd.								imposed by non-public
								issuance of A shares

Total	1,726,627,740		1,726,627,740	0	0

3.3 Information of Shareholders and Ultimate Controller
3.3.1 Number of shareholders
Total number of shareholders of ordinary shares as at the end of
the reporting period	571,235
Total number of shareholders of ordinary shares at the end of the
month preceding the date of the announcement	572,148
Total number of shareholders of preference shares with reinstated
voting rights as at the end of the reporting period	0
Total number of shareholders of preference shares with reinstated
voting rights at the end of the month preceding the date of the
announcement	0

3.3.2 Shareholdings of the top ten shareholders and top ten shareholders of tradable shares (or shareholders without selling restrictions) as at the end of the reporting period

Unit: Shares

Shareholdings of the top ten shareholders

		Increase/	Total number		Number	Number of pledged
		decrease
		during the	of shares held		of shares	or frozen shares
		reporting	at the end of	Shareholding	with selling	Conditions		Nature of
No.	Name of shareholder	period	the period	percentage	restriction	of share	Number	shareholder
				(%)
1	China Railway Engineering Group	0	11,598,764,390	47.21	0	Nil	0	State-owned
	Company Limited ("CREC")							legal person
	(Note 1)
2	HKSCC Nominees Limited (Note 2)	-47,000	4,008,792,799	16.32	0	Nil	0	Other
3	China Securities Finance	0	683,615,678	2.78	0	Nil	0	State-owned
	Corporation Limited							legal person
4	China Reform Holdings	0	387,050,131	1.58	0	Nil	0	State-owned
	Corporation Ltd.							legal person
5	China Great Wall Asset	0	372,192,507	1.51	0	Nil	0	State-owned
	Management Co., Ltd.							legal person
6	Hong Kong Securities Clearing	94,638,904	305,635,916	1.24	0	Nil	0	Other
	Company Limited (Note 3)
7	Central Huijin Asset	0	235,455,300	0.96	0	Nil	0	State-owned
	Management Ltd.							legal person
8	China Orient Asset Management	0	223,271,744	0.91	0	Nil	0	State-owned
	Co., Ltd.							legal person
9	China Structural Reform Fund	-1,672,500	221,623,899	0.90	0	Nil	0	State-owned
	Corporation Limited							legal person
10	ABC Capital Management Co., Ltd.	0	178,138,508	0.72	0	Nil	0	Other
	- Suida (Jiaxing)
	Investment Partnership (LLP)

Statement on the related relations and concerted actions between the shareholders above

CREC, the controlling shareholder, does not have related relations or perform concerted actions with the above other shareholders. The Company is not aware of any related relationships or concerted action relationships between the above shareholders.

Unit: Shares

Shareholdings of the top ten shareholders without selling restrictions

		Number of
		shares held
		without selling	Type and number of shares
No.	Name of shareholder	restrictions	Type	Number
1	CREC (Note 1)	11,434,370,390	RMB-denominated	11,434,370,390
			ordinary shares
		164,394,000	Overseas listed	164,394,000
			foreign shares
2	HKSCC Nominees Limited (Note 2)	4,008,792,799	Overseas listed	4,008,792,799
			foreign shares
3	China Securities Finance Corporation	683,615,678	RMB-denominated	683,615,678
	Limited		ordinary shares
4	China Reform Holdings Corporation	387,050,131	RMB-denominated	387,050,131
	Ltd.		ordinary shares
5	China Great Wall Asset Management	372,192,507	RMB-denominated	372,192,507
	Co., Ltd.		ordinary shares
6	Hong Kong Securities Clearing	305,635,916	RMB-denominated	305,635,916
	Company Limited (Note 3)		ordinary shares
7	Central Huijin Asset Management	235,455,300	RMB-denominated	235,455,300
	Ltd.		ordinary shares
8	China Orient Asset Management Co.,	223,271,744	RMB-denominated	223,271,744
	Ltd.		ordinary shares
9	China Structural Reform Fund	221,623,899	RMB-denominated	221,623,899
	Corporation Limited		ordinary shares
10	China Securities Finance Corporation	178,138,508	RMB-denominated	178,138,508
	Limited		ordinary shares

Statement on the related relations and concerted actions between the shareholders above

Note 1: CREC held 11,598,764,390 shares of the Company (including 11,434,370,390 A shares and 164,394,000 H shares).

Note 2: H shares held by HKSCC Nominees Limited are held on behalf of its various clients, and the number of H shares held by CREC is already deducted.

Note 3: A shares held by Hong Kong Securities Clearing Company Limited are held on behalf of its various clients.

Note 4: The data shown in the table is based on the register of members of the Company as at 31 December 2020.

3.3.3 Shareholdings of top ten shareholders of shares with selling restrictions and terms of selling restrictions

Not applicable

3.3.4 Strategic investors or general legal persons becoming the top ten shareholders by placing new shares

Not applicable

3.4 Substantial Shareholders and Holders of Interests or Short Positions Required to be Disclosed under Divisions 2 and 3 of Part XV of the Securities and Futures Ordinance

As at 31 December 2020, the Company had been informed by the following persons that they had interests or short positions in the shares or underlying shares of the Company as recorded in the register required to be maintained under Section 336 of the Securities and Futures Ordinance:

Holder of A shares

					Approximate
				Approximate	percentage
Name of substantial		Number of A	Nature of	percentage of	of total
shareholders	Capacity	shares held	interest	issued A shares	issued shares
		(Shares)		(%)	(%)
CREC	Beneficial owner	11,434,370,390	Long position	56.15	46.54
Holders of H shares
					Approximate
				Approximate	percentage
Name of substantial		Number of H	Nature of	percentage of	of total
shareholders	Capacity	shares held	interest	issued H shares	issued shares
		(Shares)		(%)	(%)
The Bank of New York	Interest of	252,540,328	Long position	6.00	1.03
Mellon Corporation	controlled	249,041,253	Lending Pool	5.92	1.01
	corporations
Deutsche Bank	(Note 1)	229,803,271	Long position	5.46	0.94
Aktiengesellschaft		123,424,962	Short position	2.93	0.50
		10,406,000	Lending Pool	0.25	0.04
Lehman Brothers	Interest of	210,186,560	Long position	5.00	0.86
Holdings Inc.	controlled	94,560,550	Short position	2.25	0.38
	corporations

Notes:

1 According to the Corporate Substantial Shareholder Notice filed by Deutsche Bank Aktiengesellschaft with the Hong Kong Stock Exchange dated 13 January 2014, the interests held by Deutsche Bank Aktiengesellschaft were held in the following capacities:

	Number of	Number of
	H shares	H shares
Capacity	(Long position)	(Short position)
Beneficial owner	139,171,310	123,424,962
Person having a security interest in shares	17,515,361	-
Interest of controlled corporations	54,042,600	-
Custodian corporation	10,406,000	-
Others	8,668,000	-

2 The interests or short positions include the underlying shares as follows:

		Long Position			Short Position
	Listed	Listed Non-listedNon-listed	Listed	Listed Non-listedNon-listed
	equity	equity	equity	equity	equity	equity	equity	equity
	derivatives	derivatives	derivatives	derivatives	derivatives	derivatives	derivatives	derivatives
Name of substantial	payment	settled	payment	settled	payment	settled	payment	settled
shareholders	in kind	in cash	in kind	in cash	in kind	in cash	in kind	in cash
BlackRock, Inc.	-	-	-	223,000	-	-	-	933,000
Deutsche Bank
Aktiengesellschaft	-	-	-	17,624,000	-	-	-	10,166,000
Lehman Brothers
Holdings Inc.	-	-	10,000,000	-	-	-	60,000	-

Apart from the foregoing, as at 31 December 2020, no person or corporation had any interest or short position in the share capital of the Company as recorded in the register required to be kept under section 336 of the SFO that would fall to be disclosed to the Company under Divisions 2 and 3 of Part XV of the SFO.

3.5 Information on Controlling Shareholder and Ultimate Controller

3.5.1 Details of controlling shareholder

Name of controlling shareholder	China Railway Engineering Group
	Company Limited
Legal representative	CHEN Yun
Date of establishment	7 March 1990
Principal business	Construction works, related engineering
	technological research, survey, design,
	services, manufacturing of specialized
	equipment and development and
	operation of real estates.
Details of controlling interests and	Nil
investments in other domestic and
overseas-listed companies during the
reporting period
Other information	Nil

3.5.2 The diagram of the interests and controlling relationships between the Company and the controlling shareholder

China Railway Engineering

Group Company Limited

47.21%

China Railway Group Limited

3.5.3 Details of ultimate controller

Ultimate controller of the Company - State-owned Assets Supervision and Administration Commission of the State Council ("SASAC"), which is the ministry level institution directly under the State Council, and was set up in accordance with the institutional reform plan of the State Council and the Notice of the State Council on Establishment of Institutions passed at the First Session of the 10th National People's Congress. SASAC is authorized by the State Council to perform its duties as an investor on behalf of the State. The scope of supervision of SASAC extends to the state-owned assets of central government owned enterprises (excluding financial enterprises). Currently, SASAC holds 90% equity interests in CREC and National Social Security Fund holds 10% equity interests in CREC.

3.5.4 The diagram of the interests and controlling relationships between the Company and the ultimate controller

State-owned Assets Supervision and

Administration Commission National Social Security Fund

of the State Council

90%

10%

China Railway Engineering Group

Company Limited

47.21%

China Railway Group Limited

3.5.5 Ultimate controller's control of the Company through trust or other asset management methods

Not applicable

Other Legal Person Shareholders with Shareholding of over 10%
As of the end of the reporting period, except for HKSCC Nominees Limited, the Company has no other legal person shareholders with shareholding of over 10%.
Information on the Restrictions on Reduction of Shareholdings Not applicable

4 MANAGEMENT DISCUSSION AND ANALYSIS

4.1 Review and Outlook

Great achievements are the result of sustained efforts. 2020 has been a year like no other. Bearing in mind the two major landscapes and national interests, we, guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, took the initiative in promoting the fight against the COVID-19 pandemic and being a pioneer in operations. Against major headwinds, we are a strong champion of high-quality development, contributing to stable economic growth. We won the trust of SASAC, the capital market and staff by announcing our first-ever ranking among the top 50 of the Fortune Global 500, demonstrating our prowess.

This year, we stayed true to our original intention and worked hard with our mission firmly in mind. In the face of the pandemic, we embraced challenges. We supported the construction of 46 hospitals such as Wuhan Huoshenshan Hospital, Wuhan Leishenshan Hospital. Furthermore, we invested in and constructed the pandemic emergency response project, Camp 1 of the "home of constructors in east Rongcheng County, Xiongan New Area". Focusing on the "6+6" initiative (i.e. stability in employment, finance, foreign trade, foreign capital, investment and expectation, and supporting employment, people's livelihoods, being a main market player, achieving food and energy safety, stable industrial chain supply and community-leveloperation) and "two struggles", we conducted campaigns featuring "100 days of hard work" and "combating four seasons to achieve goals" to fight the pandemic for growth. As a result and as scheduled, we promoted the resumption of work and production of nearly 5,000 construction projects, creating more than 1 million jobs. The Company's major economic indicators were on the rise, hitting a record high level. We, committed to the development philosophy with people at the core, engaged in targeted poverty reduction efforts with fruitful results. Both the "the smart terraced fungus-farmingproject" in Jinmi village, Zhashui County, Shaanxi Province, and the poverty relief efforts in Shazhou village, Rucheng County, Hunan Province were commended by General Secretary Xi Jinping. The Company received honors for "National Advanced Collective in Poverty Relief" and "National Advanced Individual in Fighting the COVID-19",which fully reflected our responsibilities.

This year, we shouldered the responsibilities as a major national force. Following significant decisions and deployments made by the central government, we stepped forward to serve the national strategies as a pioneer for the "China Railway for China Construction". Specifically, we were involved in city cluster construction in the Beijing - Tianjin - Hebei region, the Yangtze River Delta, the Pearl River Delta, Xiongan New Area, Guangdong - Hong Kong - Macao Greater Bay Area and Chengdu - Chongqing double city economic circle. We filled infrastructure gaps, contributing to such strategies as a stronger China through transport, rural revitalization and the Belt and Road Initiative. Furthermore, we have made great progress in major projects at home and abroad such as the Sichuan - Tibet Railway, Beijing - Xiongan Expressway, Chengdu - Kunming Railway, and China - Laos Railway, Jakarta - Bandung High - speed Railway, Budapest - Belgrade Railway, and Bangladesh Padma Bridge, and completed super projects such as the Beijing - Xiongan Intercity Railway, Pingtan Strait Highway Bridge, and Dazhu Mountain Tunnel. The completed Shanghai - Jiangsu Yangtze River Highway Bridge and the avenues currently under construction for the Winter Olympics featuring "three competition zones and one Olympic village" were recognized and hailed by General Secretary Xi Jinping.

This year, we empowered China Railway's development through reform and innovation. We, committed to the "Party's Governance over Officials and State-ownedEnterprise Reform" initiative, were a strong champion of the important guidance of the "three transformations" mentioned by General Secretary Xi Jinping. To that end, we cemented our foundations and kept working hard with innovative thinking. Specifically, we improved the enterprise legal person system and promoted efforts to modernize the corporate system with Chinese characteristics, including rolling-out mixed-ownershipreforms and carrying out comprehensive reforms through the "two hundred" program and an organization reform of the headquarters. We restructured and established China Tiegong Investment and Construction Group Co., Ltd., China Overseas Engineering Co.,Ltd. and China Railway Cloud Network Information Technology Co., Ltd., acquired China Railway Prefabricated Construction Co., Ltd. ("China Railway Prefabricated Construction"), China Railway Changjiang Transport Design Group Co., Ltd. ("China Railway Changjiang Institute"), China Railway Water Conservancy

Hydropower Planning and Design Group Co., Ltd. ("China Railway Water Conservancy Institute"), and made successful spin-off listing of China Railway High- Speed Electrification Equipment Corporation Limited ("China Railway High-SpeedElectrification Equipment"). Making fresh breakthroughs in technological innovation, we won the China Industry Award and the golden prize of the China Excellent Industry Design Award for the first time, with the sales volume of shield tunneling machines ranking first for the fourth year running. Furthermore, we ranked first for the third year in a row among central government-owned architecture enterprises in the number of National Technology Awards. We are on the track to top all past "China records" and "China name cards" represented by Chinese roads, bridges, high-speed railways and shield tunneling machines.

This year, China Railway was in full bloom with a focus on future development. We will review actions by focusing on strategic guidance. Specifically, we analyzed the general picture and are fully aware of the risks and challenges facing us. This helped acquaint us with market rules so that we could better position China Railway and work out a development blueprint during the "14th Five-YearPlan" period. Committed to market orientation, we cast an eye on the long-termresource allocation by having in place modern production models and production relations that thrive amid intense market competition. Meanwhile, we adhered to high-qualitydevelopment by reshaping the corporate culture system, deepening efforts in corporate work styles, and launching improvements in quality and efficiency. This would help improve construction, operation development, cost management, streamlining, assets management and assets operation, laying a solid foundation for our mission in the "14th Five-YearPlan" period.

You reap what you sow. 2021 will be a year of unique importance in China's modernization drive and marks the first year of the "14th Five-Year Plan" period, in which China Railway will embark on a new journey. China Railway, under the leadership of the CPC Central Committee with Xi Jinping at the core, will stay committed to the corporate spirit "Striving for Excellence" and take this fresh development stage into full consideration by following an innovative development philosophy and following new development patterns. We will join each other to make

success of the beginning of the "14th Five-Year Plan" period and serve our country, dedicate ourselves to society and repay our shareholders and staff with high-quality development.

4.2 Business Overview

The Group is one of the largest multi-functional integrated construction groups in the world, which enables us to offer a full range of construction and industrial products and related services to our customers. The Group holds an industrial leading position in fields such as infrastructure construction, survey, design and consulting services, engineering equipment and component manufacturing. The Group also diversifies its business and expands its value-added services by exploiting into other businesses such as real estate development, merchandise trading, investment and operation of infrastructure, mining development and finance. After years of practice and development, the Group's businesses have established a close upstream-downstream relationship among themselves, with the infrastructure construction business supporting the engineering equipment and component manufacturing, survey, design and consulting and merchandise trading business; infrastructure investment, real estate development and mining development businesses supporting the survey, design and consulting services and infrastructure construction business; survey, design and consulting services supporting the infrastructure construction business; engineering equipment and component manufacturing business providing construction equipment (such as bridge girder erection machine and shield) and the necessary components (such as turnout, bridge steel structure and rail transit electrification equipment) for infrastructure construction; merchandise trading business supplying materials (such as steel and cement) for infrastructure construction; and finance business offering financing services for main businesses. All these have gradually formed a vertically integrated construction industry chain with outstanding principal business supplemented by diversified relevant business horizontally.

4.2.1 Industry development overview

Infrastructure construction

Domestically, since the first quarter of 2020 when the country actively promoted the pandemic prevention and control and resumed work and production, the infrastructure construction industry has gradually returned to normal. As the country has intensified counter-cyclical adjustments, the growth rate of infrastructure investment has gradually picked up and presented a steady rise overall. In 2020, investments in fixed assets across the country grew steadily, with infrastructure (excluding electricity) investment having a year-on-year increase of 0.9%. The investment in certain weak areas was strengthened and the investment growth in the eastern, northeastern and western regions was sped up. Throughout the year, investments in fixed assets of national transportation were about RMB3.48 trillion, representing a year-on-year increase of 7.1%, and the investment scale remained high. In terms of railways, the scale of investment in fixed assets in railways during the period of 13th Five-year Plan was relatively stable, basically maintaining at around RMB800 billion per year. In 2020, investment projects of RMB781.9 billion were completed, new railway lines with a total length of 4,933 kilometers were put into operation, and the length of railways in operation nationwide reached over 146,000 kilometers (among which, the length of high-speed railways reached 38,000 kilometers) as of the end of 2020. In terms of roads and waterways, since 2017, China's fixed asset investment in roads and waterways has been running at a high level, basically around RMB2.3 trillion per year and reached RMB2.59 trillion in 2020. The State steadily implemented the National Highway Network Plan 2020-2030 in highway construction, and gradually improved the network system of national integrated three-dimensional transportation through investment policy guidance. In respect of urban rail transit, steady progress was made in urban rail transit projects nationwide in 2020, with a total length of 1,240.3 kilometers of 39 new lines put into operation, hitting a record new high. As of the end of 2020, a total of 7,545.5 kilometers of 233 urban rail transit lines were in operation in 44 cities across Mainland China. As regards the PPP business, during the "13th Five-Year Plan" period, PPP has experienced rapid development due to large-scale promotion and undergone shrinkage due to strict supervision. With the gradual stabilization of the regulatory environment and the continuous regulation and improvement to the PPP model by various national ministries and commissions, the PPP model has become one of the normalized tools for government infrastructure investment and financing and has also provided support for other innovative models of the government's investment and financing system. As of 31 December 2020, the Ministry of Finance had a total of 13,298 PPP projects with a total investment of RMB19.17 trillion, of which 9,928 projects were in the database with an investment of RMB15.21 trillion, and 3,370 projects were in the reserve list with an investment of RMB3.96 trillion.

Internationally, during the "13th Five-Year Plan" period, steady and sound progress was made in the cooperation in external infrastructure investments, with continuous expansion in scale, continuous optimization of structure, and continuous improvement of benefits. The cooperation has played an active role in pursuing the Belt and Road Initiative with quality, boosting the economic and social development of the host country, deepening the economic and trade relations between our country and related countries, and promoting the construction of an open world economy. In 2020, the global spread of COVID-19 has brought certain challenges to the overseas production and operation of Chinese construction enterprises. Some international contracted projects were in a state of suspension, and the advancement of tracked overseas projects were forced to delay. The progress of resumption of work and production still depends on the local pandemic control, which to a certain extent, tests the ability of Chinese construction enterprises to identify, handle, and manage risks. In view of the data of countries along the Belt and Road throughout the year, the value of contracts of overseas business and the completed turnover indicators both showed a downward trend. The amount of new contracting projects from 61 countries along the Belt and Road decreased by 8.7% year on year to US$141.46 billion, representing 55.4% of the amount of new contracting projects of China from all foreign countries for the same period. The turnover decreased by 7% year on year to US$91.12 billion, representing 58.4% of the total amount of turnover of completed contracting projects from all foreign countries for the same period. From the perspective of national policies, China will continue to promote the construction of the Belt and Road Initiative and expand trade and investment cooperation with countries along the Belt and Road. As the pandemic eases, infrastructure as a key investment direction will continue to play an important role in the construction of the Belt and Road Initiative.

Survey, design and consulting services business

Being a technology- and intelligence-intensiveproduction-based service industry, the survey, design and consulting services business offers technical and management services throughout the decision-making and implementation process of the construction work of various industries, including construction, transportation, electricity and irrigation works. The survey, design and consulting services business has a leading position in project construction, and is an important link for improving the investment benefits and social and environmental benefits of construction projects. At this stage, the industry development focuses on strengthening areas of weakness in the infrastructure, renovating old urban areas, and improving the living environment and people's quality of life; practicing the concept of "lucid waters and lush mountains are invaluable assets", infiltrating the design concept of energy conservation and environmental protection, and promoting ecological environment construction; arranging the regional coordinated development strategies, strengthening the construction of new infrastructures, paying more attention to digitalization and intelligence, and facilitating the application of BIM technology. In 2020, the COVID-19 brought a greater negative impact on the engineering survey and design industry. With the prevention and control of the pandemic and the resumption of work and production, marked achievements were made in the overall recovery of the survey and design industry. Under the background of top-level strategic layouts including the country's establishment of a new "dual-cycle" development pattern and acceleration of the construction of "Two New and One Major" (new infrastructure and new urbanization as well as major projects) (兩新一重), the industry as a whole has entered the deepening stage of supply-side structural reform, and the main path of reform and development has been actively involved in the national strategy, matching market demand, and upgrading the quality of products and services. The entire industry has moved from a stage of rapid growth to one of mature development and has maintained a benign development trend amid continuous transformation and transition. With the acceleration of the process of marketalization, the reform of the engineering construction organization model, the reform of qualification management and the development of Internet technologies, the form of competition among peers and across industries will embrace qualitative changes. The "14th Five-Year Plan" will become a very important watershed in the survey and design industry. A number of enterprises will emerge with pioneering advantages in specialized products, distinctive brands, platform-based development, intensive management, intelligent BIM technology application, whole-process engineering consulting services, EPC, digital transformation and other aspects.

Engineering equipment and component manufacturing business

During the "13th Five-Year Plan" period, the investments in the fixed assets of railways remained relatively high, and investments in roads, urban rail transit, water conservancy, and underground space development grew steadily. As far as policies are concerned, with the gradual implementation of the "14th Five-Year Plan", the construction of traditional and new infrastructure is carried out simultaneously. With further promoting the joint pursuit of the Belt and Road Initiative, it is expected that in 2021 and a period in the future, there will be more ample space for railways, highways, urban rail, municipal roads, underground pipe corridors and underground space. As a leading enterprise engaged in high-end equipment manufacturing in the field of infrastructure construction, the tunnel boring machines, special equipment for tunnel mechanization, construction machinery, and products for turnouts and steel bridges developed by the Company will be used more widely. The successive release of the Action Plan for Promoting the Production and Application of Green Building Materials and the Guiding Opinions on Vigorously Developing Prefabricated Construction has provided strong policy support for the development of prefabricated construction. With the increasing application of prefabricated construction, municipal bridge steel structure and other products with the characteristics of "green, environmental friendly and circular economy", the market demand will further expand. Looking forward, the industrialization of new-type buildings represented by prefabricated buildings will become the trend of reform of construction methods, as it is an emerging industry that leads the development of the construction industry. It will push forward the green development and high-quality development of urban and rural construction, and drive the overall transformation and upgrading of the construction industry. However, the intensified competition in the industry will bring about some new changes in the market environment. To a certain extent, it has brought uncertain effects on the demand for tunnel construction equipment, turnout products for urban rail transit and electric equipment products in the future. Throughout the year of 2020, the added value of large-scale industries recorded a year-on-year increase of 2.8%, in which the added value of high-tech manufacturing industry and equipment manufacturing industry increased by 7.1% and 6.6% year on year respectively.

Real estate development business

In 2020, the Party Central Committee and the State Council adhered to the general position that houses are for living in and not for speculative investment and always stated that real estate should not be used as a means to stimulate the economy in the short term. They strictly controlled the "three red lines" of the assets-to-liabilities ratio after excluding receipts in advance, net gearing ratio, and cash-to-current borrowings, and actively stabilized land prices, housing prices and expectations, to ensure the stable and healthy development of the real estate market. With respect to land market transaction, the turnover of the national land market remained stable, and the transaction amount of the national land market increased markedly. According to the National Bureau of Statistics, the land purchased by real estate developers totaled 255.36 million square meters, representing a year-on-year decrease of 1.1%. The land transaction price was RMB1.7269 trillion, representing a year-on-year increase of 17.4%. With respect to the turnover of commodity housing market, the overall turnover of the year remained stable, the residential transaction area increased slightly, and the office and commercial housing transaction area continuously shrank. China's investment in real estate development totaled RMB14.1443 trillion in the year, representing a year-on-year increase of 7.0%, of which the investment in residential housing was RMB10.4446 trillion. The sales area of commodity housing was 1,760.86 million square meters, representing a year-on-year increase of 2.6%, of which the sales area of residential housing increased by 3.2%, the sales area of office buildings decreased by 10.4% and the sales area of commercial housing decreased by 8.7%. The sales amount of commodity housing was RMB17.3613 trillion, representing a year-on-year increase of 8.7%. As to the competitive landscape of real estate enterprises, data showed that the sales performance of real estate enterprises across the country gradually picked up in the second half of the year, but the sales performance was differentiated and the sales of branded real estate enterprises grew sharply during the year.

Other businesses

Mining development business

At the beginning of 2020 when the COVID-19 broke out worldwide, market panic rose sharply and the sale of various assets in big quantities surged sharply, causing the price of commodities to fall all the way down. In the second half of 2020, various countries continued to intensify their economic stimulus policies to alleviate the impact of the pandemic. As a result, the economy slowly restarted, the price of mineral products fluctuated upward, and the mining industry economics showed an uptrend. Additionally, as the Federal Reserve introduced the unlimited loose policy, commodity prices rebounded strongly and went steadily upwards, and the price of most commodities returned to before the pandemic and even hit a record high. However, due to the complicated world political and economic situation and the spread of protectionism and unilateralism, international trade frictions will bring a sustained impact on the economy in the future.

Financial business

In 2020, affected by the global pandemic, the world economy suffered a severe recession, the loop of industry chain and supply chain was blocked, international trade and investment were reduced, and the market of commodities was volatile. Domestic consumption, investment, and exports declined; employment pressure increased significantly; enterprises, especially private enterprises, small and medium-sized enterprises faced more difficulties. The government continued to implement proactive fiscal policies and prudent monetary policies, introduced a series of financial and monetary policies, accelerated the issuance and use of special local government bonds, issued special anti-pandemic treasury bonds, reduced taxes and fees, optimized the supervision of equity asset allocation of insurance companies, and promoted finance infrastructure interconnection. After the economy began to recover steadily, the country shifted its focus to the prevention of risks at the policy level. The central government repeatedly mentioned putting an end to the phenomena of "idle funds arbitrage" and "fishing in troubled waters". The central bank also started to tighten marginal liquidity to ensure the overall stability of our country's financial operations.

4.2.2 Business development overview

The Group's principal business activities are infrastructure construction, survey, design and consulting services, engineering equipment and component manufacturing, real estate development and other businesses.

In 2020, the Group earnestly implemented the three-year special action plan for deepening the reform of state-owned enterprises, took actions to enhance management to align with world-class standards, adhered to market-driven and problem-orientated approaches, and continued to promote reform in depth. First, the Company optimized and improved the corporate governance system, followed the organic unity of party leadership and perfect corporate governance, and ensured that the corporate governance structure was scientific and reasonable. The construction of the corporate governance system with the Articles of Association as the guiding principle was more complete. The corporate governance mechanism characterized by "statutory and transparent powers and responsibilities, coordinated operation, and effective checks and balances" was more mature, and decision implementation and supervision were more effective. Second, the Company deepened organizational reforms, optimized management and operating systems, systematically promoted "streamlining and improvement", and established a management innovation platform, to push forward the modernization of governance systems and capabilities and enhance governance efficiency. The Company steadily promoted the mixed-ownership reform and "double hundred action". China Railway Major Bridge Design Institute and China Railway Engineering Equipment were selected as "Demonstration Enterprises in Science and Technology Reform", to develop into pacesetters and keep fully motivated to go forward. Third, the Company promoted business structure reform, and optimized the professional layout of water environmental protection, design consulting, industrial manufacturing and other businesses. The Company integrated the resources of China Railway Prefabricated Construction, China

Railway Changjiang Institute and China Railway Water Conservancy Institute, to complement their respective industrial advantages, enhance comprehensive strength and focus on the development of the main business centering on high-quality resources.

In 2020, by giving leading position to market operations, the Group deepened the reform of the system and mechanism, achieved notable results in regional operations and three-dimensional operations, and accumulated the momentum of growth for orders in hand. First, the Company deepened the reform of the market-oriented operation mechanism, insisted in the combination of performance orientation and long-term development, concentrated on grasping market opportunities, continued to exert efforts in high-end operations and investment stimulation, and achieved outstanding results in the collaboration of major projects. Second, by actively getting involved in the national strategy of serving the country, the Company was brave to undertake the mission of shoring up weak spots in infrastructure, building a strong transportation country and pursuing the Belt and Road Initiative. While consolidating traditional fields, the Company vigorously expanded emerging markets, made breakthroughs in urban complex development, underground pipe corridor, sponge city, water conservancy, environmental protection and new infrastructure construction, and fostered new growth poles. Third, the Company proactively promoted the reform of the system of overseas operations, gave prominence to overseas "Double Priorities" development strategy, created a new development matrix of "one main body with two wings and multiple drivers", built an overseas operation and management system of "region + country + project", overcame the grim overseas pandemic situation, and pressed ahead with overseas operations under pressure. Fourth, the Company gradually strengthened the allocation of operating elements and dramatically improved the reserve of qualifications and resources. The Company obtained 75 qualifications of special grade and 267 survey and design qualifications. The number of various professional and vocational qualification certificates maintained a moderate growth, with constant improvements to the structure.

The Group was always in the firm belief that innovation is the first driving force for development and cost reduction and efficiency improvement were the source of sustainable development. In 2020, by means of broadening income source and reducing expenditure, the Company ensured that its development was in a high-quality and healthy state. First, the Company enhanced the driving force for cost reduction and efficiency improvement. The two-pronged approach of macro- and micro-cost management was effective in dealing with the pandemic. The advantages of centralized funds and centralized procurement of materials continued to be exploited to the full, solid outcomes were achieved in cost management, and economic operations were stable and controllable. Meanwhile, the Company actively expanded high-quality financing channels, held debt scale and debt ratio under strict control, and pushed forward equity financing and asset securitization in an orderly fashion. The Company continued to improve financial indicators such as financing cost, asset-liability ratio and cash flow, and guarded against and defused risks in an all-round way, to ensure sustained improvement to economic quality. Second, the Company enhanced the traction of innovation and efficiency. On the one hand, the Company attached importance to management innovation and developed soft power, and promoted innovations in the management and control model with the transformation of "management capital".

The Company promoted innovations in the business model with the linkage of the entire industry chain as well as systemic innovations in the operation model, production organization model, financing model, and information management model, etc. The Company fully tapped into its own potential while pursuing management benefits. On the other hand, the Company focused on scientific and technological innovations and enhanced hard power. The Company earnestly implemented the "Three Transformations", established a research institute for high-quality development, built a number of scientific and technological innovation centers, and systematically promoted the tackling of problems in key technologies. The Company steadily improved its strength of scientific and technological innovation. During the year, the Company won 14 Zhan Tianyou Awards, ranking first among central state-owned construction enterprises, and won 7 National Science and Technology Awards. The Company ranked first among state-owned construction enterprises for three years in a row in terms of the total number of awards.

In 2020, the Group's production and operation maintained a good momentum. It honored the promise of benefiting society and rewarding shareholders and demonstrated the responsibilities that a central enterprise in a great power should undertake. First, the Company considered safety development as a matter of primary importance. It solidly advanced the three-year special rectification action for safe production, and established a dual prevention mechanism for hierarchical risk control and hidden danger elimination. It made smooth progress in the construction of domestic and foreign projects, and achieved overall stability of safe production throughout the year. Second, there were multiple highlights in project construction. The Company completed a multitude of major projects widely praised at home and abroad. Throughout the year, the Company won 12 Luban Awards, the International Bridge Conference (IBC) Award, and the ITA "Tackling Toughness and Overcoming Difficulties" award (the highest honor of the international tunnel industry). The projects continued to burnish the image of Chinese roads, bridges, tunnels, high-speed railways and shield tunneling machines. Third, the Company actively fulfilled social responsibilities. The Company bravely shouldered heavy responsibilities in the fight against the pandemic and supported the completion of a great number of pandemic prevention and control projects of emergency and dangerous tasks, such as the building of Huoshenshan Hospital and Leishenshan Hospital. The Company undertook the responsibilities that a central enterprise should undertake in poverty alleviation. It took targeted measures according to local conditions, established a long-term assistance mechanism, and achieved sustained income generation, to serve the interests of people there. As a result, three designated poverty-stricken counties receiving assistance from the Company were lifted out of poverty ahead of schedule. Upholding the concept of green development in terms of energy conservation and environmental protection, the Company threw itself into the fight against pollution prevention and control, and strengthened the application of energy-saving and low-carbon technologies. The Company remarkably strengthened ecological environmental protection, energy conservation and emission reduction, and achieved a marked fall in comprehensive energy consumption.

As a responsible listed company, the Group insists on strengthening the enterprise, rewarding shareholders and benefiting society, attaches importance to shareholder returns, strives to enhance market recognition and boost investment confidence. In 2020, the Group entered the top 50 of Global 500 for the first time and ranked 2nd among the world's largest contractors in the Engineering News-Record. It has been assessed as an A-type enterprise by SASAC for seven consecutive years in performance appraisal of central enterprises. It has been assessed as an A-type (outstanding) listed enterprise by the Shanghai Stock Exchange for seven consecutive years in the evaluation of information disclosure of listed companies. In terms of environmental protection, social responsibility and corporate governance (ESG), the Group's MSCI ESG rating was elevated to BB, which enhanced the Group's image in domestic and foreign capital markets.

In 2020, the amount of new contracts of the Group was RMB2.60566 trillion, representing a year-on-year increase of 20.4%. In particular, the amount of new contracts of domestic business was RMB2.46940 trillion, representing a year-on-year increase of 21.2%; the amount of new contracts of overseas business was RMB136.26 billion, representing a year-on-year increase of 6.8%. As of the end of the reporting period, the amount of contract backlog of the Group was RMB3.72597 trillion, with an increase of 10.9% as compared with the end of 2019. The amount of new contracts and of contract backlog by business segment as of the end of the year is set out as below:

	Unit: 100 million Currency: RMB
Amount of New Contracts
						Year-
						on-year
						increase/
Business segment	2020		2019	decrease
Infrastructure construction	21,829.2		17,946.3	21.6%
Including: Railway	3,553.8		3,112.4		14.2%
Highway	4,097.6		3,090.6		32.6%
Municipal works and others	14,177.8		11,743.2		20.7%
Among which: Urban rail transit	1,660.4		2,014.0		-17.6%
Municipal works	4,459.1		4,644.9		-4.0%
Housing construction	6,106		4,360.3		40.0%
Survey, design and consulting services	258.6		288.1		-10.2%
Engineering equipment and
component manufacturing	542.8		420.9		29.0%
Property development	685.6		696.8		-1.6%
Other businesses		2,740.4		2,296.6		19.3%
Total	26,056.6		21,648.7	20.4%

Unit: 100 million Currency: RMB

Amount of Contract Backlog
					Year-
					on-year
	End of	End of	increase/
Business segment	2020		2019	decrease
Infrastructure construction	34,939.3		31,641.8	10.4%
Including: Railway	6,364.7		6,179.5		3.0%
Highway	6,880.2		5,620.0		22.4%
Municipal works and others	21,694.4		19,842.3		9.3%
Among which: Urban rail transit	4,460.5		5,009.9		-11.0%
Survey, design and consulting services	559.0		546.0		2.4%
Engineering equipment and
component manufacturing	713.5		541.6		31.7%
Other businesses	1,047.9		882.6		18.7%

Total	37,259.7		33,612.0	10.9%

Infrastructure construction

The Group has always been a leader in China's infrastructure construction industry and one of the largest construction contractors in the world. As of the end of the reporting period, the Group has 18 general contracting projects for railway construction at special grade, accounting for over 50% of the total number of general contracting projects for railway construction at special grade in China; 27 general contracting projects for highway construction at special grade; and 19 general contracting projects for engineering construction at special grade and 10 general contracting projects for municipal public engineering at special grade. The Group is the largest construction group in the fields of railway infrastructure and urban rail transit infrastructure in China. It has the only National Key Laboratory of High Speed Railway Construction Technology, National Key Laboratory of Bridge Structural Stability and Safety and National Key Laboratory of Shield Tunneling and Drilling Technology in China, representing the most advanced technological level in terms of railway and rail transit construction in China. At the same time, the Group is one of the major infrastructure construction forces in the construction of the Belt and Road Initiative. It is the main contractor of the representative projects along the "One Belt, One Road" including China-Laos Railway, the Indonesian Jakarta-BandungHigh-speed Railway and the Budapest-Belgrade Railway. In the domestic market, the Group's share in the railway's large and medium-sized infrastructure market has remained above 45%, its share in the urban rail transit infrastructure market has remained over 40%, and its share in the expressway infrastructure market has remained over 10%.

In 2020, the amount of the Group's new contracts of infrastructure construction business was RMB2.18292 trillion, representing a year-on-year increase of 21.6%. As at the end of 2020, the amount of the Group's contract backlog of infrastructure construction business was RMB3.49393 trillion, representing an increase of 10.4% from the end of 2019. From a business segment perspective: ① In respect of railway construction business, benefiting from the steady progress in the tendering for domestic large and medium-sized railway projects such as the Sichuan-Tibet Railway, the amount of new contracts in the Group's railway business maintained a steady growth and amounted to RMB355.38 billion, representing a year-on-year increase of 14.2%; the amount of contract backlog amounted to RMB636.47 billion, representing a year-on-year increase of 3.0%. The Group's market share in domestic large and medium-sized railway construction reached 57.3% in 2020, maintaining the first place in China. ② In respect of the highway construction business, benefiting from the steady growth of domestic expressway network construction and the Company's increased efforts to participate in expressway construction through investment models, the amount of new contracts in the Group's highway business increased substantially and amounted to RMB409.76 billion, representing a year-on-year increase of 32.6%; the amount of contract backlog amounted to RMB688.02 billion, representing a year-on-year increase of 22.4%. ③ In respect of municipal works and other businesses, with the promotion of urban clusters, urban circles and urbanization in China as well as the intensified development of the Group's urban construction market, the amount of new contracts in the housing construction business increased substantially, spurring a steady growth in new contracts for municipal works and other businesses. The amount of new contracts in the year amounted to RMB1.41778 trillion, representing a year-on-year increase of 20.7%; the amount of contract backlog amounted to RMB2.16944 trillion, representing a year-on-year increase of 9.3%. Among them, the new contracts for municipal works business reached RMB445.91 billion, representing a year-on-year decrease of 4.0%; new contracts for the housing construction business amounted to RMB610.6 billion, representing a year-on-year increase of 40.0%; and the new contracts for urban rail transit business totaled RMB166.04 billion, representing a year-on-year decrease of 17.6%. From a business model perspective: In 2020, the amount of new contracts for infrastructure construction obtained by the Group through the construction contracting mode was RMB1.75313 trillion, representing a year-on-year increase of 24.3%. The amount of new contracts for infrastructure construction obtained through investment mode reached RMB429.79 billion, representing a year-on-year increase of 11.8%. The amount of contract backlog of infrastructure investment business was RMB746.2 billion, representing a year-on-year increase of 26%.

During the reporting period, key projects under construction and investment projects contracted or participated in by the Group progressed smoothly. The century project that the Group participated in the construction - the Sichuan-Tibet Railway whose early construction commenced officially during the year; China's first and the world's longest cross-strait combined bridge - the Pingtan Straits Rail-cum-Road Bridge designed and constructed by the Group, and the intelligent railway - the Beijing-Xiong'an Intercity Railway that the Group participated in the construction, were opened to traffic and selected as the "top 10 super projects of central enterprises"; the most difficult tunnel to bore - the Dazhushan Tunnel was successfully bored; the Winter Olympics stadium of "Three Ski Resorts and One Village" was progressing smoothly; the China-Laos Railway, Jakarta-BandungHigh-Speed Railway, Bangladesh Padma Bridge and other overseas projects were pushed forward in an orderly way; the Yangtze River Sanqiao Highway Bridge in Wuhu, Anhui, the world's first high and low tower cable-stayed bridge for railway and highway that the Group participated in the construction, was officially opened to traffic; and a wide array of key projects, such as the Shuangliao-Taonan Expressway, the Shangqiu-Hefei-HangzhouHigh-speed Railway, the Shanghai-Suzhou-Nantong Yangtze River Bridge and Xi'an Metro Line 9 were opened to traffic on schedule. Five bridges including Wuhan Yangsigang Yangtze River Bridge won the International Bridge Conference (IBC) Award, and the Yujingshan Tunnel of the Chengdu-GuiyangHigh-speed Railway won the 2020 ITA "Tackling Toughness and Overcoming Difficulties" award (the highest honor of the international tunnel industry).

Survey, design and consulting services Business

As a backbone enterprise in China's survey and design industry, the Group has played an important leading role in the field of engineering construction, especially in assisting in the formulation of construction codes and quality acceptance standards of the railway industry. On the list of ENR 2020 Top 150 Global Design Firms and on the list of ENR 2020 Top 225 International Design Firms, the Group ranked 16th and 122nd respectively.

In 2020, the amount of new contracts of the Group's survey, design and consulting services business was RMB25.86 billion, representing a year-on-year decrease of 10.2%, which was mainly attributable to the year-on-year decrease in the international business. As of the end of 2020, the value of the Group's contract backlog of survey, design and consulting services business was RMB55.9 billion, representing an increase of 2.4% from the end of 2019.

During the reporting period, as the overall design unit of the Ya'an-Linzhi section of the Sichuan-Tibet Railway, the Group was responsible for the survey and design of the Ya'an-Changdu section, the research report was approved by the National Development and Reform Commission, and the construction of the early commencement segment was commenced on schedule during the year. The feasible evaluation of the construction drawing of the Chengdu-ChongqingHigh-speed Railway was completed, the initial design of the Chengdu-Dazhou-Wanzhou Railway was completed, and the design of the Xi'an-KunmingHigh-speed Railway was progressing in an orderly manner.

Engineering equipment and component manufacturing business

The Group has a leading position in the field of high-end equipment manufacturing related to transportation infrastructure such as railways, highways, urban rail transit and underground engineering in the country and even the world. It has outstanding competitiveness in scientific and technological innovation strength, core technology advantages, production and manufacturing level, brand awareness and other aspects. The Group is the world's largest shield/TBM R&D manufacturer in terms of sales volume, the world's largest steel structure manufacturer of turnouts and bridges, the largest railway construction equipment manufacturer in China, and the world's leading manufacturer of infrastructure construction service equipment. For the domestic market, the Group maintained an approximate market share of 55% in the high-speed turnout market that requires high technical requirements (speed over 250km/h), a market share of more than 50% in the heavy-haul turnout market, a market share of 60%-70% in the turnout market of urban rail transit business, a market share of more than 60% in the large steel structure bridge market, a market share of more than 60% in the catenary parts market of high-speed railway, and a market share of approximate 50% in the power supply products market of urban rail transit business. China Railway Hi-Tech Industry Co., Ltd. ("CRHIC") (600528. SH), a controlling subsidiary of the Group, has the most complete products in the field of railway infrastructure equipment in our country and is the only industrial enterprise in A share market that mainly engages in high-end equipment for rail transit and underground excavation. China Railway High-speed Electrification Equipment Corporation Limited ("CRHEEC") (873023) is an important supplier engaging in the R&D, production and system integration of domestic electrified catenary components and power supply equipment for urban rail transit. China Railway Prefabricated Construction (300374.SZ) is a supplier with rich product structure and integrated service capabilities of prefabricated buildings in the domestic prefabricated building component industry and a provider of complete sets of prefabricated building solutions.

In 2020, the amount of new contracts for the engineering equipment and component manufacturing business of the Group was RMB54.28 billion, representing a year-on-year increase of 29.0%, of which the amount of new contracts of domestic business was RMB51.43 billion and that of new contracts of overseas business was RMB2.85 billion. This was mainly attributable to the rapid growth of special equipment for tunnel construction. The performance in the new bridge laying equipment, transportation equipment, steel structure and other businesses continued to improve, and the Group won large orders for various projects, including water resources of the Pearl River Delta, the Singaporean Cross Island Line and the Georgian Highway Tunnel. As of the end of 2020, the value of the Group's contract backlog of engineering equipment and component manufacturing business was RMB71.35 billion, representing an increase of 31.7% from the end of 2019. In 2020, the Group produced and sold 241 tunnel construction devices (of which 124 were new shield tunneling machines/new TBM machines and

79 were re-manufactured), representing a year-on-year increase of 13.8% in new machines.

During the reporting period, the Group solved the technical bottleneck that restricted the Group's industrial development, by accelerating the market layout, seeking key breakthroughs, and focusing on the aspects of bridge industrialization, technical progress in turnouts, and localization of construction machinery and key components of tunneling equipment. The Group strengthened the development and coverage of the domestic market, and the amount of new contracts in steel structure, turnout, construction machinery, tunnel construction equipment and other major sectors grew by more than 10%. The Group won the bidding for a batch of key projects, including the manufacturing and installation of bridge steel structures of the Wuhu-Huangshan Expressway.

Property development business

The Group is one of 16 central enterprises that SASAC has identified as taking the property development as the main business. The Group's property development business complied with the national policy guidance and adhered to the new development concept. Tailoring to the market demand, the Company took the multiple-dimension "special real estate+" path of ensuring projects under construction, selling quickly, reducing cost and improving efficiency. The Group marched towards the areas of culture tourism, industrial real estate and TOD, and worked to realize the transformation from traditional commercial real estate development to the integrated, multi-format,multi-industry,multi-functional development model. This aimed to help the Group build core competitiveness in real estate development with China Railway's characteristics.

In 2020, the Group had a total of 195 secondary real estate development projects located in more than 50 cities including Beijing, Shanghai, Guangzhou, Shenzhen, Tianjin, and Hangzhou. During the reporting period, the sales amount of the Group's real estate development business was RMB68.56 billion, representing a year-on-year decrease of 1.6%. The decrease was mainly attributable to the impact of the COVID-19 and the price-cap policy of local governments.The sales area was 5.254 million square meters, representing a year-on-year increase of 4.5%; the area of which construction was commenced was 4.907 million square meters, representing a year-on-year decrease of 39.2%; and the area of which construction was completed was 6.817 million square meters, representing

1. year-on-yearincrease of 116.4%. As of the end of 2020, the Group's property projects under construction covered an area of 46.99 million square meters, and the land reserve area to be developed was 16.009 million square meters. During the reporting period, the Group achieved encouraging sales results in first-tier cities and second-tier cities.
Other businesses

Mining development business

In the process of infrastructure construction at home and abroad, the Group has obtained a number of mineral resources projects through acquisitions and mergers based on "fiscalization of resources" and "exchange of resources for projects". China Railway Resources Group Co., Ltd., the Company's wholly-owned subsidiary, is responsible for the development business of mineral resources. The Group's mining business is mainly based on the management and development of mining entities. Currently, it wholly owns, controls or holds shares to invest in construction of 5 modern mines at home and abroad, including Luming Molybdenum Mine, Heilongjiang; Luishia Copper-Cobalt Mine, Comagnie Minière de Luisha S.A.S, Congo; MKM Copper-Cobalt Mine; SICOMINES Copper-Cobalt Mine; and Wulan Lead and Zinc Mine, Mongolia. The main mineral products produced and sold include concentrate, copper cathode and cobalt hydroxide of varieties involving copper, cobalt, molybdenum, lead, zinc and others. In 2020, the prices of the Group's main mineral products including copper, cobalt, molybdenum, lead and zinc were falling first and then rising on the whole, of which the price of copper increased from the average annual price of copper in 2019, whereas the prices of molybdenum, cobalt, lead and zinc fell to varying degrees from the average annual price in 2019. As of the end of the reporting period, the above mines' retained resources/reserves mainly include copper of approximately 8,440,000 tons, cobalt of approximately 640,000 tons, and molybdenum of approximately 660,000 tons. In particular, the retained reserves of copper, cobalt and molybdenum are in the leading position in the same industry in China, and the mines' production capacity for copper and molybdenum has been at the forefront in the same industry in China.

Financial business

The financial business of the Group has always followed the principle of developing business around the main business, and formed a strategic synergy with the main businesses. At present, the Group mainly involves trust, fund, factoring, insurance brokerage, and financial leasing business, and has built a multi-level,wide-covered and differentiated "finance, quasi-finance" institutional service system represented by China Railway Trust Co., Ltd. ("China Railway Trust"), China Railway Finance Co., Ltd., and China Railway Capital Co., Ltd. The three financial enterprises have adhered to the concept of serving the value of the main business, satisfying the needs of the market and organically integrating the development of the corporate strategy, and formulated strategic implementation approaches and resource allocation plans based on maximizing the value of the main business, so as to generate synergy and maximize the benefit of the Group. As an important trust business platform of the Group, China Railway Trust enjoyed a good reputation in the industry, and its rating by the China Banking and Insurance Regulatory Commission and China Trustee Association has been kept at the forefront of the industry.

Merchandise trading business

The merchandise trading business of the Group represents the trading business carried out by the trading enterprises at all levels of the Company relying on the demand advantage, service advantage and resource channel advantage and centralized purchase and supply based on the main businesses of the Group. It mainly serves the internal trading demand of the Group and provides external services in an appropriate manner. China Railway Material Trade Co., Ltd, a wholly-owned subsidiary of the Company, has established

national-wideoperation and service network, and maintained good cooperative relationship with domestic large-scale production enterprises of steel, cement, petrochemical, components for communications engineering, signal engineering, electrical engineering and electrification engineering, building decoration materials and other products. It carries out centralized procurement and supply of major materials at the Group level, and supplies materials to other domestic construction enterprises.

Infrastructure operation business

The Group obtains concessions rights for operating rail transit, expressway, water utilities and other projects through investment and construction, and obtains operating income by providing operation and management services for government payments and viability gap funding, or charging users in accordance with relevant standards. The infrastructure projects operated by the Group include rail transit, expressway, water supplies, municipal roads, industrial parks and underground pipe corridors, with the operating period ranging from 8 to 40 years. As the PPP (BOT) investment projects undertaken by the Group have been completed and entered the operation period, the revenue and profit of the Group's PPP (BOT) operation business have shown an overall growth trend.

4.2.3 Scientific research investment and technological achievements

As one of the country's first "innovation-oriented enterprises" awarded by the Ministry of Science and Technology, the SASAC and the All-china Federation of Trade Unions, the Group has 3 national laboratories (the National Engineering Laboratory of High Speed Railway Construction Technology, National Key Laboratory of Shield Tunneling and Drilling Technology, and National Key Laboratory of Bridge Structural Stability and Safety), 10 postdoctoral workstations, 1 national local joint research center (national and local joint engineering research center for the research and application of digital rail transit technologies), 36 provincial and ministerial research and development centers (laboratories), 19 nationally recognized technology centers, and 107 technical centers recognized at the ministerial or provincial level. It has also set up 20 professional R&D centers and invested in the national technology innovation center for the Sichuan-Tibet railway.

During the reporting period, the Group implemented research projects focusing on Sichuan-Tibet Railway construction technology, high speed railway construction technology, bridge construction technology, tunnel and underground project construction technology, communications engineering, signal engineering, electrical engineering and electrification engineering technology, construction equipment and industrial product manufacturing technology, building technology, energy conservation and emissions reduction, and other new areas of technology, intelligent manufacturing and information technology. Based on the actual needs for the production and operation of the Group and relying on such key projects as the Central Yunnan Water Diversion Project, Chengdu-Nanchong-Dazhou-WanzhouHigh-speed Railway, Qingdao Metro, Guangzhou Metro, Changtai Yangtze River Bridge, Chaohu-Ma'anshan Intercity Railway, Ma'anshan Yangtze River Bridge, phase II of the Project of Water Diversion from the Eerqisi River in Xinjiang and Guangzhou-Shenzhen-Hong Kong Express Rail Link, we focused on the research of through-typesame-phase power units, research of key technologies for intelligent evaluation and improvement of service performance of the ballastless track and bridge structure system of high-speed railways, research of key technologies for intelligent construction, and research of key technologies for the construction of the Central Yunnan Water Diversion Project. During the reporting period, the Group won 6 National Prizes for Progress in Science and Technology, 1 Technological Invention Award, 11 Zhan Tianyou Civil Engineering Prizes, 345 provincial and ministerial science and technology achievement awards, 4,933 new authorized patents, including 676 invention patents and 47 PCT patents. The "Shield tunneling machine for tunnel connection and its tunneling method" won the gold prize of the 21st China Patent Prize. 3 patents, namely "integrated ballastless track", "hyperboloid ball bearing with anti-lifting beam and anti-falling beam function", and "a rotatable spoke used for the blade of shield tunneling machine" won the outstanding awards. 909 engineering methods received provincial and ministerial level recognition.

4.2.4 Establishment and implementation of safety and quality system

In 2020, the Group organized the integration and certification of the QMS, EMS and OHSAS, and earnestly implemented the QMS, EMS and OHSAS. The Group also strictly implemented the domestic and international industrial standards and continuously improved its internal quality assurance system to make sure that its system and rules (including the Measures for Supervision on and Management of Construction Quality) are effectively compatible with those currently in force in relation to construction quality control, quality assurance and management, quality accident handling and accountability for accidents, and that the management process is in an orderly and controllable condition, thus providing a solid foundation for the highly effective operation of the Group's quality management system.

During the reporting period, the Group won 63 National Quality Engineering Awards, including 4 National Quality Engineering Gold Awards, 12 China Construction Engineering Luban Prizes, and 47 National Quality Engineering Awards. 19 projects were included on the list of learning exchange of national construction sites for safe construction and standardized production. The brand reputation of the construction quality of the Group was further enhanced.

4.2.5 Implementation of environmental protection measures

The details are set out in the "Environmental protection information" under the "Significant Events" on page 88 to page 90 of this announcement.

4.2.6 Compliance with laws and regulations

As a company dually listed on Shanghai Stock Exchange and the main board of the Hong Kong Stock Exchange, during the reporting period, the Group strictly complied with laws and regulations including the Company Law, the Securities Law, the Code of Corporate Governance for Listed Companies, and the various rules of the Shanghai Stock Exchange and the Hong Kong Stock Exchange, continuously enhanced the corporate governance structure and brought forth new ideas to the operational mechanism of corporate governance, thereby continuously enhancing the rationality and effectiveness of corporate governance. During the reporting period, there was no material breach of laws and regulations by the Group.

4.2.7 Maintenance of relationship with stakeholders

The Group always maintains a cooperation relationship of harmony, mutual trust and mutual benefit with its stakeholders, insists on putting itself in the shoes of the stakeholders to consider issues and proactively responds to the important issues of the stakeholders' concern. The Group has in place a smooth, standardized and distinctive communication system with the stakeholders, and strives to achieve mutual, harmonious and win-win development with the stakeholders.

4.2.8 Outlook

As the impact of the COVID-19 that broke out in 2020 persists, 2021 will be a crucial year for economic recovery. The world is undergoing major changes of a scale unseen in a century, international mechanisms and order are being reconstructed, and relations between major countries are being adjusted profoundly. However, in the current period, the new "dual-cycle" development pattern is being constructed, and the basic trend of steady and long-term growth in China's economy has not changed and will not change in the next period. First, a series of national strategies and new-type urbanization arrangements have laid a solid foundation for the sound development of infrastructure industry in the future. Regional development strategies such as the co-development of Beijing-Tianjin-Hebei, integration of the Yangtze River Delta, and construction of Guangdong-HongKong-Macao Greater Bay Area, and a series of major national strategies such as ecological civilization, building China into a strong transportation country, building China into a strong maritime country, and rural revitalization have been accelerated. The "Two New and One Major" has huge market space. Major projects such as the Sichuan-Tibet Railway, the new land-sea corridor in western China, and the national water network have accelerated construction, bringing huge business growth space for the Company. Second, the supply-side reform of the construction industry has been intensified. Project organization models such as EPC and whole-process engineering consulting have accelerated development. New technologies, new materials, and new processes have profoundly affected traditional construction production methods. The qualification reform of construction enterprises has accelerated, and workers of construction industry have quickened their cultivation so as to create a good environment for high-quality development of the Company. Third, the proactive fiscal policy will be deepened with more quality efficiency and be more sustainable, while the prudent monetary policy will be more flexible, targeted, and appropriate. The focus is on the construction of livelihood projects and major projects, to promote sustained economic and social development while taking into account the relationship between stable growth, ensuring employment, structural adjustment, risk prevention and inflation control. The Group works to ensure that the growth rate of money supply and social financing scale matches the nominal economic growth rate and maintain the basic stability of macro leverage ratio. Fourth, fixed asset investment under pressure will remain stable. In the context of export and consumption difficulties, investment will continue to grow. Infrastructure investment is characterized by regional and structural opportunities. The central and western regions of China have a large room for infrastructure investment, and there is a strong demand for new infrastructure, public facilities for people's livelihood, transportation and water conservancy and other major projects. Real estate investment, along with increase in the urbanization rate and economic and social development, will be kept within an appropriate range of growth. Investments related to advanced manufacturing, driven by policies, will embrace rapid development. Fifth, new generation of information technology has accelerated the development. The rapid promotion of new technology applications represented by green buildings, smart buildings, digital construction, etc., and the acceleration of construction of an intelligent construction industry system integrating the entire industry chain including scientific research, design, production and processing, construction and assembly, and operations have facilitated the digital transformation of the Company. The

outline of the "14th Five-Year Plan" of the national economy gives top priority to technical innovation, highlighting the principal position of enterprise innovation, and enterprise innovation will usher in a new period of policy opportunities. Sixth, the scale of the construction industry market continues to expand, but the growth rate will decline in volatility. In 2020, the total output value of the national construction industry was RMB26.4 trillion, representing a year-on-year increase of 6.2%. With the improvement of the level of urbanization, the construction industry will continue to expand in scale, and its pillar position in the national economy will be further consolidated, but the growth rate will slow down. Seventh, innovation-drivenhigh-quality development is the theme. Construction industrialization, digitalization and intelligence have been remarkably improved, and the development of the construction industry will gradually transform from being driven by investment and labor to by innovation and from being extensive to being intensive. The high-quality development of the construction industry has become an irresistable trend. Eighth, structural adjustment has accelerated and the emerging market areas have become the focus. The development structure of the construction industry will change from mainly incremental expansion to a combination of stock adjustment and optimized increment. On the basis of stable development of traditional segments, the development structure will speed up the transformation to infrastructure such as "Two New and One Major" projects, ecological protection and renovation and maintenance of construction products. Ninth, model changes are accelerating, and integrated development has become a trend. Construction project investment and construction models, and project production organization models will accelerate reforms, and investment diversification and integration of investment, construction and operation will become the mainstream. PPP will still play an important role in the supply of public products. Models such as EPC and whole-process engineering consulting will accelerate promotion. Tenth, as industry competition intensifies, it is key to improve capabilities. The competitive landscape of construction enterprises changes at a faster pace, industry barriers are being broken, and industry competition is increasingly inclined to talent, technology, resource, brand, capital and other factors. It is crucial to accelerate technology and management innovation, implement integration of industry and finance, and improve the production and operation capabilities of enterprises in an all-round way.

Overall, the fundamentals of the sustained and sound development of the construction market have not changed, and the Group will remain in an important period of strategic opportunities. In the future, the Group will continue to strengthen its resolve to promote in-depth reform and accelerate transformation and upgrading, to become stronger, better and bigger.

4.2.9 Operating plan

In 2021, the Group plans to achieve total revenue of approximately RMB983.0 billion, operating cost of approximately RMB884.7 billion, and four types of expenses of approximately RMB53.2 billion. It is estimated that the new contracts to be entered into will amount to approximately RMB2,640.0 billion. The Group will promptly adjust its operation plan to suit market conditions and to reflect the actual implementation of the plan.

Financial Performance Overview
The Group's principal business activities are infrastructure construction, survey, design and consulting services, engineering equipment and component manufacturing, property development and other businesses.
In the year of 2020, the Group achieved revenue of RMB974.732 billion, representing a year-on-year increase of 14.6%. Net profit for the year increased by 7.4% year-on-year to RMB27.250 billion while profit for the year attributable to owners of the Company increased by 6.4% year-on-year to RMB25.188 billion.
A comparison of the financial results for 2020 and 2019 is set forth below.
Consolidated Results of Operations

Revenue

In 2020, the Group's revenue increased year-on-year by 14.6% to RMB974.732 billion. It was mainly due to the increase in revenue from the Group's infrastructure construction business.

Cost of sales and services and gross profit

The Group's cost of sales and services primarily includes cost of raw materials and consumables, subcontracting cost, equipment usage cost (consisting of maintenance, rental and fuel), employee compensation and benefits and depreciation and amortization expenses. In 2020, the Group's cost of sales and services recorded a year-on-year increase of 14.7% to RMB884.380 billion while gross profit of the Group increased year-on-year by 13.1% to RMB90.352 billion. The overall gross profit margin for 2020 was 9.3%, representing a decrease of 0.1 percentage point as compared to that for 9.4% in 2019. Among which, there was an year-on-year increase in gross profit margin of infrastructure construction business and survey, design and consulting services business while there was a year-on-year decrease in gross profit margin of engineering equipment and component manufacturing business, property development business and other businesses.

Other income

The Group's other income primarily consists of dividend income and subsidies from government. In 2020, the Group's other income was RMB2.219 billion, increased by 11.2% from RMB1.996 billion of last year. Such increase of other income was primarily due to the increase in subsidies from government.

Other expenses

The Group's other expenses primarily includes expenditures on research and development. In 2020, other expenses increased by 32.3% from RMB16.511 billion of last year to RMB21.838 billion, mainly due to the Group's continuous advancement on scientific research and technological innovation and further increase input in research and development.

Net impairment losses on financial assets and contract assets

The Group's net impairment losses on financial assets and contract assets mainly includes impairment losses on trade and other receivables, other financial assets at amortised cost and contract assets. In 2020, the Group's net impairment losses on financial assets and contract assets decreased year-on-year by 43.3% to RMB2.556 billion, mainly attributable to the decrease in net impairment losses on other financial assets at amortised cost.

Other gains, net

The Group's other gains and losses mainly include gains and losses on disposal/ write-off of financial assets/liabilities, joint ventures, associates and subsidiaries, foreign exchange gains/losses, impairment losses on property, plant and equipment and other assets and changes in the fair value of financial assets through profit and loss. The Group's other gains recorded RMB0.662 billion in 2020, representing a decrease from RMB5.705 billion in 2019. Such decrease was primarily due to a gain of RMB4.955 billion on disposal of 51% equity interest in Guangxi China Railway Communications Expressway Management Co., Ltd. and related debts was included in other gains of 2019.

Losses from derecognition of financial assets at amortised cost

The Group's losses from derecognition of financial assets at amortised cost mainly include the losses arising on derecognition of trade receivables which were transferred in accordance with asset-backedmedium-term notes ("ABN") and asset-backed securities ("ABS") issuance, and non-recourse factoring agreements. In 2020, the Group's losses from derecognition of financial assets at amortised cost was RMB3.302 billion, representing a decrease of 1.9% from last year. In 2020, the Group transferred trade receivables of RMB55.142 billion and RMB16.854 billion under the issuance of ABN and ABS, and non-recourse factoring agreements, respectively (2019: RMB51.508 billion and RMB16.062 billion, respectively).

Selling and marketing expenses

The Group's selling and marketing expenses primarily consist of employee compensation and benefits, distribution and logistic costs and advertising costs. In 2020, the Group's selling and marketing expenses amounted to RMB5.020 billion, representing

year-on-yearincrease of 9.0%. Such increase was mainly due to the strengthening in marketing effort on property development projects and industrial products. The selling and marketing expenses as a percentage of revenue for 2020 was 0.5%, basically remained the same as that for 2019.

Administrative expenses

The Group's administrative expenses mainly consist of employee compensation and benefits and depreciation and amortization of its assets related to administration. In 2020, the Group's administrative expenses increased year-on-year by 0.8% to RMB24.668 billion. Such increase was mainly due to the normal increase in staff salary with the increase in profitability. Administrative expenses as a percentage of revenue for 2020 was 2.5%, basically remained the same as that for 2019.

Finance costs, net

In 2020, the Group's net finance costs (finance costs less finance income) was RMB2.432 billion, representing a decrease of 27.9% from 2019. It was mainly due to the rapid increase in interest income resulting from 1) interest income of financial assets recognised for certain infrastructure construction investment projects and 2) the significant increase in average daily balances of bank deposits as compared to last year.

Profit before tax

As a result of the foregoing factors, the profit before tax for 2020 increased by RMB2.425 billion, or 7.3% to RMB35.612 billion from RMB33.187 billion for 2019.

Income tax expense

In 2020, the Group's income tax expense increased year-on-year by 7.1% to RMB8.362 billion. By excluding the impact of land appreciation tax, the effective income tax rate of the Group decreased by 0.7 percentage point from 17.9% for 2019 to 17.2% for 2020. Such decrease was mainly due to the further entitlement on various preferential income tax treatments, such as high and new technology enterprises, development of the western region and deduction of research and development expenditures.

Profit for the year attributable to owners of the Company

In 2020, profit for the year attributable to owners of the Company increased by 6.4% to RMB25.188 billion from RMB23.678 billion for 2019.

4.5 Segment Results

The revenue and results of each segment of the Group's business for the year ended 31 December 2020 are set forth in the table below.

														Profit/
									Profit/				(loss)
					Profit/			(loss)		Revenue		Before
					(loss)			Before		as a		Tax as a
			Growth	Before	Growth	Tax	Percentage	Percentage
Business Segment	Revenue	Rate	Tax	Rate	Margin1		of Total		of Total
	RMB			RMB
	million	(%)		million	(%)		(%)		(%)		(%)
Infrastructure Construction	876,310		15.0		36,876		76.1	4.2	83.7	87.4
Survey, Design and
Consulting Services	17,321	1.7	2,241	133.0	12.9	1.7	5.3
Engineering Equipment and
Component Manufacturing	29,793	22.5	2,132	6.7	7.2	2.8	5.1
Property Development	49,763	14.0	(4,096)	-212.2	(8.2)	4.8	(9.7)
Other Businesses	74,183	5.4	5,016	-44.0	6.8	7.0	11.9
Inter-segment Elimination
and Adjustments	(72,638)			(6,557)

Total	974,732		14.6		35,612		7.3	3.7	100.0	100.0

1 Profit/(loss) before tax margin is the profit/(loss) before tax divided by the revenue.

Infrastructure construction business

Revenue from the Group's infrastructure construction business is mainly derived from construction of railway, highway and municipal works. Revenue from the infrastructure construction business continues to account for a high percentage of total revenue of the Group. In 2020, the revenue from the infrastructure construction business accounted for 83.7% of the total revenue of the Group (2019: 83.1%). In 2020, in response to the adverse impact brought by the COVID-19 and downward pressure on the international economy, the State successively implemented a series of counter cycle adjustment measures to fully stabilize economy, investment and growth, which are favourable policies to the Group. At the same time, the Group coordinated and promoted various work on epidemic prevention and control as well as production and operation, comprehensively promoted the resumption of work and production which increased productivity and efficiency. In 2020, due to the significant increase in revenue from the highway and municipal works business, the Group's revenue of infrastructure construction business increased by 15.0% year-on-year to RMB876.310 billion. Gross profit margin and profit before tax margin of the infrastructure construction business for 2020 was 8.0% and 4.2% respectively (2019: 7.1% and 2.7% respectively). Such increase was mainly due to the increase in proportion of the revenue from highway and municipal works business which have higher gross profit margin.

Survey, design and consulting services business

Revenue from the operation of the survey, design and consulting services business primarily derives from providing a full range of survey, design and consulting services, research and development, feasibility studies and compliance certification services on infrastructure construction projects. In 2020, the Group overcame the adverse impact of COVID-19 by actively resuming work and production, revenue of survey, design and consulting services business recorded RMB17.321 billion, representing a year-on-year increase of 1.7%. Gross profit margin and profit before tax margin for the segment for 2020 was 31.4% and 12.9% respectively (2019: 27.0% and 5.6% respectively). The increase in gross profit margin and profit before tax margin were mainly due to ① the Group carried out in-depth work on increasing quality, reducing costs and increasing efficiency and there was significant decrease in outsourcing costs resulting from the reduced use of outsourcing units and personnel through various measures on increase in production efficiency and decrease in proportion of outsourcing and ② the decrease in travelling expenses resulting from the restriction of on-site work brought by COVID-19.

Engineering equipment and component manufacturing business

Revenue from the operation of the engineering equipment and component manufacturing business primarily derives from the design, research and development, manufacture and sale of turnouts and other railway-related equipment, bridge steel structures and construction machinery. In 2020, the Group actively implemented the spirit of the important directives of "Three Transformations" and firmly seized the strategic opportunities of the new round of technology and industrial revolution, optimized the industrial layout and strived to build a world-classhigh-end equipment manufacturing enterprise. In 2020, the Group's revenue of the engineering equipment and component manufacturing business increased by 22.5% year-on-year to RMB29.793 billion. Gross profit margin and profit before tax margin was 19.4% and 6.7% respectively for 2020 (2019: 23.1% and 8.2% respectively). The decrease in gross profit margin and profit before tax margin was mainly attributable to ① the continuous decrease in order price of manufacturing and installation of shield and steel structures due to the increase in market competition and ② the significant increase in cost of manufacturing and installation of shield and steel structures due to the increase in cost of raw materials, accessories and outsourcing labor.

Property development business

In 2020, the Group strictly adhered to the national policy on property market, further strengthened the effort on the transformation and upgrading and the increase in quality and profitability of the property development business. The Group explored new business development and profit drivers, devoted to foster its brand competitivity in property development business, diversified the marketing models, strived to overcome the adverse impact brought by the control policies on property market and accelerated the de-stocking progress. In 2020, revenue from property development business recorded RMB49.763 billion, increased by 14.0% year-on-year. Gross profit margin and profit before tax margin for 2020 was 11.5% and -8.2% respectively (2019: 25.1% and 8.4% respectively). The decrease in gross profit margin was mainly due to ① the decrease in selling price of certain projects as a result of the government's price limit policy and ② the decrease in profitability of certain projects with longer development cycle resulting in increase in costs. In 2020, the Group's property development business recorded a loss before tax which was mainly due to the impairment losses made on certain property development projects.

Other businesses

In 2020, the Group strived to progressively implementing the "limited and interrelated" diversification strategy, revenue from other businesses increased year-on-year by 5.4% to RMB74.183 billion in 2020. Gross profit margin for 2020 was 18.3%, representing a decrease from 21.3% for 2019. Profit before tax for 2020 was RMB5.016 billion (2019: RMB8.950 billion). Among which, ① revenue from infrastructure operation business was RMB1.459 billion, a year-on-year decrease of 58.6% while gross profit margin was 19.8%, a decrease of 23.3 percentage points from last year. It was mainly due to the disposal of 51% equity interest in Guangxi China Railway Communications Expressway Management Co., Ltd. in 2019; ② revenue from mining was RMB4.105 billion, a year-on-year decrease of 28.3% while gross profit margin was 37.9%, a decrease of 9.0 percentage points from last year; ③ revenue from merchandise trading was RMB52.190 billion, a year-on-year increase of 12.7% while gross profit margin was 6.3%, remained the same as that of 2019 and ④ revenue from financial business was RMB4.549 billion,

year-on-yearincrease of 23.2% while gross profit margin was 75.9%, a decrease of 4.2 percentage points from last year.

In 2020, the Group firmly grasped the core task of high-quality development, and actively resolved part of the downward pressure on the prices of mineral products. The overall development and sales of mineral resources remained stable. Among which, the Group produced 211,800 tons of copper (year-on-year increase of 5.35%), 2,567 tons of cobalt (basically remained the same as last year), 7,963 tons of molybdenum (year-on-year decrease of 48.72%), 14,300 tons of lead (year-on-year decrease of 16.31%), 21,400 tons of zinc (year-on-year increase of 31.47%), 43.32 tons of silver (year-on-year increase of 0.07%).

As at 31 December 2020, the Group's mineral reserves are as follows:

							Unit: 100 million	Currency: RMB
								Investment
						Total		by the	Production
		Mineral resources			planned	Accumulated	Company	quantity
						investment	investment	in the	in the	Planned
				Resource/	Equity	of the	of the	reporting	reporting	completion	Project
No. Project name	Type	Grade	Reserve	ratio	project	project	period	period	date	progress
				(Ton)	(%)				(Ton)
1	Luming Molybdenum	Molybdenum	0.086%	659,490	83	60.17	60.26	0	7,963	Completed	In normal
	Mine, Yichun City of	Copper	/	/					614		production
	Heilongjiang(Note)
2	SICOMINES Copper-Cobalt	Copper	3.141%	7,862,415	41.72	45.86	27.52	6.38	155,444	July 2021	Phase 1 in normal
	Mine, La Sino-congolaise	Cobalt	0.244%	604,548					866		production,
	Des Mines S.A., Congo										phase 2 under
											construction
3	Luishia Copper-Cobalt Mine,	Copper	2.299%	548,282	72	21.38	21.60	2.40	32,704	Completed	In normal
	Comagnie Minière de	Cobalt	0.105%	33,069					93		production
	Luisha S.A.S, Congo
4	MKM Copper-Cobalt Mine,	Copper	2.155%	31,049	80.2	11.95	12.35	0	22,989	Completed	In normal
	La Minière De Kalumbwe	Cobalt	0.253%	3,159					1,607		production
	Myunga sprl, Congo
5	Wulan Lead and Zinc	Lead	1.564%	193,266	100	15.4	15.4	0	14,273	Completed	In normal
	Mine, Xinxin Company,	Zinc	3.199%	402,903					21,364		production
	Mongolia	Silver	66.586g/t	828					43.32
6	Muhaer Lead and Zinc	Lead	0.95%	61,315	100	/	/	0	/	/	Not yet exploited
	Mine, Xinxin Company,	Zinc	3.21%	206,816
	Mongolia	Silver	114.54g/t	737
7	Gold mine, Guoxin Eerdesi	Gold	3g/t	3	100	/	/	0	/	/	Not yet exploited
	Company, Mongolia
8	Silver-Lead-Zinc Polymetallic	Lead	7%	89,693	100	3.3	3.3	0	/	/	Ceased
	Mine, Chafu, Xianglong										production
	Mineral Co., Ltd.,	Zinc	5.09%	65,190
	Mongolia	Silver	200.39g/t	257

Note: Luming Molybdenum Mine, Yichun City of Heilongjiang has an associated copper core with minimal reserve quantity, therefore there is no statistical data on the grade and reserve quantity of copper.

4.6 Cash Flow

In 2020, the net cash inflow from operating activities of the Group amounted to

RMB30.994 billion, representing an increase in net cash inflow of RMB8.796 billion from RMB22.198 billion for 2019, which was mainly due to ① the increase in advance from customers resulting from active strengthening in operation; ② the strengthened

effort on recognition and settlement of receivables as well as strengthened cash flow planning and ③ acceleration on fund recovery resulting from active implementation of asset securitization business.

In 2020, the net cash outflow from investing activities of the Group amounted to RMB63.141 billion, representing an increase in net cash outflow of RMB22.962 billion from RMB40.179 billion for 2019, which was mainly due to the increase of investment in infrastructure investment projects.

In 2020, the net cash inflow from financing activities of the Group amounted to RMB40.201 billion, an increase in net cash inflow of RMB1.986 billion from RMB38.215 billion for 2019, which was mainly due to the increase in external financing and contribution from minority interests.

Capital expenditure

The capital expenditure of the Group primarily comprises expenditure on purchases of equipment and upgrading of the Group's production facilities. The Group's total capital expenditure for 2020 was RMB56.753 billion (2019: RMB31.722 billion), which was mainly due to the increase in service concession arrangements from BOT/PPP projects and waterworks.

The following table sets forth the Group's capital expenditure by business segment in 2020.

			Survey,	Engineering
			design and	equipment and
	Infrastructure	consulting	component		Property		Other
	construction	services	manufacturing		development		businesses		Total
	RMB million	RMB million	RMB million		RMB million		RMB million		RMB million
Property, plant and
equipment	10,818		760		861	746	2,194	15,379
Lease prepayments	1,372		214		17	379	16	1,998
Investment properties	516		61		-	6	205	788
Intangible assets	359		50		48	109	36,995	37,561
Mining assets	-	-	-		-	116	116
Right-of-use assets	710		18		36	4	143	911

Total	13,775		1,103		962	1,244	39,669	56,753

Working capital
	As at 31 December
	2020	2019
	RMB million	RMB million
Inventories	40,943	40,945
Trade and bills receivables	158,774	139,080
Trade and bills payables	384,565	353,258
Turnover of inventory (days)	17	19
Turnover of trade and bills receivables (days)	55	56
Turnover of trade and bills payables (days)	150	163

At the end of 2020, the balance of the Group's inventories was RMB40.943 billion, remained basically the same as that at the end of 2019. The Group's inventory turnover days was 17 days in 2020, representing a decrease of 2 days from 19 days in 2019.

Trade and bills receivables

At the end of 2020, the Group's trade and bills receivables increased by 14.2% from the end of 2019 to RMB158.774 billion while the turnover days of trade and bills receivables was 55 days in 2020, a decrease of 1 day as compared to 56 days in 2019. According to the ageing analysis of the Group's trade and bills receivables, most of the Group's trade and bills receivables were of less than one year and the trade and bills receivables of more than one year accounted for 17.9% (31 December 2019: 16.0%) of the total receivables, which reflected the sound receivables management capability of the Group.

The following table sets forth the ageing analysis of the Group's trade and bills receivables (net of impairment) as at 31 December 2020 and 2019, based on invoice date.

	As at 31 December
	2020		2019
	RMB million	RMB million
Less than one year	130,298		116,793
One year to two years	14,833	11,395
Two years to three years	5,399	4,078
Three years to four years	2,172	1,872
Four years to five years	1,191	809
More than five years	4,881	4,133
Total	158,774		139,080

Trade and bills payables

The Group's trade and bills payables primarily consist of amounts owed to the Group's suppliers of raw materials, machinery and equipment. The Group's trade and bills payables increased by 8.9% from the end of 2019 to RMB384.565 billion as at the end of 2020. The turnover days of trade and bills payables was 150 days in 2020, a decrease of 13 days from 163 days in 2019. According to the ageing analysis of the Group's trade and bills payables, most of the Group's trade and bills payables were of less than one year and the trade and bills payables of more than one year accounted for 7.7% (31 December 2019: 7.0%) of the total payables.

The following table sets forth the ageing analysis of the Group's trade and bills payables as at 31 December 2020 and 2019, based on invoice date.

	As at 31 December
	2020		2019
	RMB million	RMB million
Less than one year	354,958		328,356
One year to two years	19,725	14,270
Two years to three years	4,933	5,153
More than three years	4,949	5,479

Total	384,565		353,258

4.7 Borrowings

The following table sets forth the Group's total borrowings as at 31 December 2020 and 2019. As at 31 December 2020, 33.2% of the Group's borrowings were short-term borrowings (31 December 2019: 48.6%). The Group is generally capable of making timely repayments.

	As at 31 December
	2020		2019
	RMB million	RMB million
Bank borrowings
Secured	80,127		40,756
Unsecured	102,340	123,919

	182,467		164,675
Long-term debentures, unsecured	49,443	46,848
Other borrowings
Secured	262	688
Unsecured	17,883	19,034

Total	250,055		231,245


Long-term borrowings	166,997		118,934
Short-term borrowings	83,058	112,311

Total	250,055		231,245

Bank borrowings carry interest rates ranging from 0.75% to 9.55% per annum (31 December 2019: 0.75% to 9.50%). Long-term debentures carry fixed interest rates ranging from 2.14% to 4.50% per annum (31 December 2019: 2.88% to 4.88%). Other borrowings carry interest rates ranging from 3.85% to 7.00% per annum (31 December 2019: 4.35% to 7.00%).

The following table sets forth the maturity of the Group's borrowings as at 31 December 2020 and 2019.

	As at 31 December
	2020		2019
	RMB million	RMB million
Less than one year	83,058		112,311
One year to two years	46,920	33,644
Two years to five years	52,212	54,970
More than five years	67,865	30,320

Total	250,055		231,245

As at 31 December 2020 and 2019, the Group's floating-rate borrowings were RMB129.376 billion and RMB93.527 billion respectively.

The following table sets forth the carrying amounts of the Group's borrowings by currencies as at 31 December 2020 and 2019. The Group's borrowings are primarily denominated in Renminbi and the Group's foreign currency borrowings are primarily denominated in U.S. dollars.

	As at 31 December
	2020		2019
	RMB million	RMB million
RMB	239,539		230,655
USD	10,501	173
Euro	2	25
Others	13	392

Total	250,055		231,245

The following table sets forth the details of the Group's secured borrowings as at 31 December 2020 and 2019.

				As at 31 December
	2020		2019
				Carrying			Carrying
	Secured		amount of	Secured	amount of
	borrowings	pledged assets	borrowings	pledged assets
	RMB million		RMB million	RMB million	RMB million
Property, plant and equipment	367		1,022		7		3
Lease prepayments	197		309		-	-
Intangible assets	39,104		50,991		12,238		21,802
Properties under development for sale	11,769		37,371		14,346		33,637
Trade and bills receivables	6,535		13,807		2,911		4,491
Trade receivables from fellow
subsidiaries of the Group	119		375		661		1,357
Contract assets	22,298			34,842		11,281		26,926
Total	80,389		138,717		41,444		88,216

As at 31 December 2020, the Group's unused credit line facility from banks was approximately RMB1,192.430 billion (31 December 2019: RMB960.220 billion).

In 2020, based on the new development stage, the Group implemented the new development concept, integrated into the new development pattern, adhered to the general keynote of the work of seeking progress while maintaining stability, took the promotion of high-quality development as the theme, took transformation and upgrading as the main line, took reform and innovation as the fundamental driving force, and continued to deepen the work of reducing leverage and debt. As at 31 December 2020, the Group's gearing ratio (total liabilities/total assets) was 73.9%, representing a decrease of 2.9 percentage points as compared with 76.8% as at 31 December 2019.

4.8 Contingent Liabilities

The contingent liabilities related to legal claims in the Group's ordinary course of business are set forth in the table below:

	As at 31 December
	2020	2019
	RMB million		RMB million
Pending lawsuits
- arising in the ordinary course of business (Note 1)	3,073	3,446

Note 1: The Group has been involved in a number of lawsuits arising in the ordinary course of business. Provision has been made for the probable losses to the Group on those claims when the management can reasonably estimate the outcome of the lawsuits taking into account of the legal advice. No provision has been made for those pending lawsuits where the management considered that the outcome of the lawsuits cannot be reasonably estimated or management believes the outflow of resources is not probable. The aggregate sum of those unprovided claims is disclosed in the table above.

4.9 Business Risks

The risks faced by the Group include investment risk, internationalization risk, cash flow risk, production safety, quality and environmental protection risk, and major pandemic prevention and control risk in the ordinary course of business.

Investment risk: It refers to the risk that due to the uncertainty of investment results arising from uncontrollable external factors, insufficient research and feasibility studies prior to project investment, inappropriate project implementation and management, significant changes in external macro environment and policies and other factors, which may lead to an investment return lower than expected or an investment failure of the Group.
Internationalization risk: It refers to the risk that due to the influence of international political situation, foreign policy changes, administrative intervention from government, economic, social, environmental or technological changes and other factors as well as conflicts between different cultures, which may lead to the failure to normally perform the contracts in the Group's overseas investment and contracted projects.
Cash flow risk: It refers to the risk that the Group may incur economic losses or damage of reputation in the event of failure to meet the requirements of timely payment, investment expenses or timely repayment of the Group's debts in its operations due to improper management of cash flow.

Production safety, quality and environmental protection risk: It refers to the risk that subjects the Group to damage to brand image, financial loss, and external regulatory penalties resulting from the quality flaw of the Group's products, and major production safety and environmental protection accidents due to the lack of effective management system implementation, measure implementation, technical management, subcontract management, equipment management, personnel management and accident handling.
Major pandemic prevention and control risk: Due to the impact of a major uncontrollable pandemic, some local governments have issued policies that regard the major pandemic as safety accidents and adopted strict control and punishment measures. Consequently, the Group cannot proceed with normal construction of projects under construction or even suffers from suspension of work, which brings great risk of contract performance and severe loss of economic benefits to the Group.

To prevent the occurrence of various types of risks, the Group makes various types of risks correspond to the various business processes through the establishment and operation of the internal control system, pursuant to which the Group can decompose and identify the critical control point of business processes, develop specific control measures, establish procedures critical control documents, implement the responsibilities of the various types of risks and critical control point, work closely with the day-to-day management and control, and control risk factors and elements. In addition, the Group strictly supervises the important control aspects of earlier stage of feasibility study, planning, reviewing, auditing, approval and decision-making; enhances process control and post-assessment work, and develop strategies and contingency plans to deal with risks, which guarantees the overall controllability of the Group's various types of risks.

5 SIGNIFICANT EVENTS

5.1 The Plan for Profit Distribution on Ordinary Shares or Capitalisation of Capital Reserves

5.1.1 Formulation, implementation or adjustment of the cash dividend policy

Specific policies for profit distribution

According to the Articles of Association of the Company, the specific policies for profit distribution of the Company are as follows:

Form of profit distribution: The Company distributes profits in cash, stock or a combination of cash and stock. The Company can make interim profit distributions when conditions permit.
Specific conditions, proportion and interval of the Company's cash dividends: Under the premise of ensuring the Company's continuous operation and long-term development, if the Company is profitable in the year and the accumulated undistributed profit is positive and there are no major investment plans or other major cash expenditures, the Company will distribute the profits in cash after appropriation to the statutory reserves and other reserves in full. In any three consecutive years, the Company's accumulated profits distributed in cash shall not be less than 30% of the annual average distributable profits realized in the three years; the annual profits distributed in cash shall generally not be less than 10% of the distributable profits realized in the year. The Company may not distribute cash dividends under the following special circumstances:

The auditors issue a non-standard unqualified audit report on the Company's financial report for the year.

The operating net cash flow is negative in the year.

If the abovementioned conditions for cash dividends are met, the Company in principle shall distribute cash dividends once a year, and the Company's Board of Directors can propose the Company to make interim cash dividends based on the Company's profitability and capital demand.

Specific conditions for the Company to issue stock dividends:
The Company can propose a stock dividend distribution plan when the Company is in good operating condition, and the Board of Directors believes that the Company's stock price does not match the Company's share capital and that issuing stock dividends is beneficial to the overall interests of all shareholders of the Company, under the premise that the abovementioned conditions for cash dividends are met.

Implementation of the cash dividend policy during the reporting period

Profits are distributed in cash under the profit distribution plan of the Company for 2019. Pursuant to the profit distribution plan considered and passed at the 2019 annual general meeting convened on 23 June 2020, a cash dividend of RMB0.169 (tax inclusive) per share based on the total share capital of 24,570,929,283 shares before the implementation of the plan (the Company's total share capital has not changed since 31 December 2019) was declared by the Company, totaling RMB4,152,487,048.83 and representing 17.5% of net profit attributable to the listed company's shareholders under the consolidated financial statements for the year of 2019 of the Company. The announcement on the profit distribution of H shares was published on 16 July 2020 on the website of Hong Kong Stock Exchange (www.hkexnews.hk) and the website of the Company (www.crec.cn). The announcement on the profit distribution of A shares was published on 31 July 2020 on China Securities Journal, Shanghai Securities News, Securities Times, Securities Daily and the website of Shanghai Stock Exchange (www.sse.com.cn). As at 13 August 2020, the implementation of the profit distribution plan of the Company for 2019 has been completed.

Profit distribution plan for 2020

Pursuant to the relevant requirements of the Company Law and the Articles of Association, taking into account factors such as shareholder returns and the capital requirements of the Company for its business development, and in accordance with the "Resolution on the Profit Distribution Plan for 2020 of the Company" which was passed at the second meeting of the fifth session of the Board, the details of the profit distribution plan are set out below: the retained profits of the Company at the beginning of 2020 were RMB57,487,757,704.41 based on the audited financial report prepared in accordance with CAS of the Company for 2020. After taking into account the added net profit realised by the Company of RMB18,470,703,277.03 during the year and deducting the cash dividends for 2020 and interest payments on perpetual notes amounting to RMB5,672,757,143.19, and with 10% of the net profit of the Company, i.e. RMB1,847,070,327.70, being appropriated to its surplus reserve, the distributable profit of the Company to shareholders amounted to RMB68,438,633,510.55 for the year. Based on the Company's total share capital of 24,570,929,283 shares as at 31 December 2020, a cash dividend of RMB1.80 per 10 shares (tax inclusive) is proposed to be distributed, and the total amount of such dividend is RMB4,422,767,270.94 (tax inclusive), representing 17.5% of net profit attributable to the Company's shareholders under the consolidated financial statements for the current year of the Company. Upon the distribution, the remaining retained profit of the Company amounting to RMB64,015,866,239.61 will be carried forward to the next year. The profit distribution will be based on the total share capital on the record date for payment of the cash dividend. In the event of change in total share capital of the Company before the record date for payment of the cash dividend, the total distribution amount will be kept unchanged and the rate will be adjusted accordingly. The Company will make a further announcement on the details of the adjustment.

The independent directors of the Company have expressed their opinions on the plan, and the above plan is still subject to the approval of the 2020 annual general meeting of the Company. Minority shareholders will be offered sufficient opportunities to express their views and requests at the 2020 annual general meeting of the Company through the combination of on-site open voting and online voting to ensure that their legal rights are fully safeguarded.

Information on the profit distribution for 2020

In 2020, the Company intends to make a cash dividend at 17.5% of net profit attributable to the listed company's shareholders under the consolidated financial statements for the current year of the Company, which is lower than the proportion in the guidelines, mainly based on the following considerations:

Situation and characteristics of the industry of the Company

From the perspective of external macro-economic environment, affected by the COVID-19 pandemic, domestic and international economic situations were severe and complicated. Internationally, the global economy was under tremendous pressure, and major developed economies showed varying reductions in growth. It will be a difficult and long journey to global economic recovery. Domestically, benefiting from the country's effective pandemic prevention and control measures, China has become the only major economy in the world achieving growth, demonstrating results of the new development pattern. However, China's economic development is currently facing new risks and challenges, and the downward pressure on the domestic economy is still large.

From the perspective of domestic and overseas infrastructure market, the Company is still in a period of promising opportunities. Firstly, a series of national strategies and new-type urbanization arrangements have laid a solid foundation for the sound development of infrastructure industry in the future. Regional development strategies such as the co-development of Beijing-Tianjin-Hebei, integration of the Yangtze River Delta, and construction of Guangdong-HongKong-Macao Greater Bay Area, and a series of major national strategies such as ecological civilization, building China into a strong transportation country, building China into a strong maritime country, and rural revitalization have been accelerated. The "Two New One Major" has huge market space. Major projects such as the Sichuan-Tibet Railway, the new land-sea corridor in western China, and the national water network have accelerated construction, bringing huge business growth space for the

Company. Secondly, the supply-side reform of the construction industry has been intensified. Project organization models such as EPC and whole-process engineering consulting have accelerated development. New technologies, new materials, and new processes have profoundly affected traditional construction production methods. The qualification reform of construction enterprises has accelerated, and workers of construction industry have quickened their cultivation so as to create

a good environment for high-quality development of the Company. Thirdly, fixed asset investment under pressure will remain stable. In the context of export and consumption difficulties, investment will continue to grow. Infrastructure investment is characterized by regional and structural opportunities. The central and western regions of China have a large room for infrastructure investment, and there is a strong demand for new infrastructure, public facilities for people's livelihood, transportation and water conservancy and other major projects. Fourthly, new generation of information technology has accelerated the development. The rapid promotion of new technology applications represented by green buildings, smart buildings, digital construction, etc., and the acceleration of construction of an intelligent construction industry system integrating the entire industry chain including scientific research, design, production and processing, construction and assembly, and operations have facilitated the digital transformation of the Company. Fifthly, the scale of the construction industry market continues to expand, but the growth rate will decline in volatility. With the improvement of the level of urbanization, the construction industry will continue to expand in scale, and its pillar position in the national economy will be further consolidated, but the growth rate will slow down. Sixthly, model changes are accelerating, and integrated development has become a trend. Construction project investment and construction models, and project production organization models will accelerate reforms, and investment diversification and integration of investment, construction and operation will become the mainstream. PPP will still play an important role in the supply of public products. Models such as EPC and whole-process engineering consulting will accelerate promotion.
The Company's development stage and its own business model
At present, the Company is at a stage of important strategic opportunities and strategic upgrade. While the business scale has been expanding year by year, the Company is on the path of transformation and upgrading, reform and innovation, and improving the quality of development, in particular, the scale of investment is increasing year by year, which causes more funding pressure on the Company.

Profitability level and demands on the funds of the Company
For the year of 2020, the Company's net profit attributable to shareholders of the Company increased by 6.38% year on year, and the basic earnings per share after deducting non-recurring profit and loss increased by 17.81% year on year. In recent years, the Company's profitability has been continuously improved, profits have increased year by year, and each year's annual profits have recorded the best in history. The Company's profits are from the steady growth of its operating scale and the sound operation of various types of business. In 2021, to successfully complete the Company's infrastructure construction contracts in hand and the new contracts expected to be signed in the year, the Company will need to purchase a certain scale of construction equipment and thus generate more capital expenditures. The Company will increase its investments in the PPP projects in hand in the field of infrastructure, which will require more investments and construction funds in 2021. At the same time, real estate projects under construction need more development efforts in order to quickly return funds. The Company will rationally arrange fund requirements according to business development needs, improve the efficiency of fund use and serve the Company's sustainable and healthy development, so as to create greater benefits for the Company.
Reasons for the Company's low level of cash dividends

The construction sector, to which the Company belongs, is a sector with adequate competition. In this sector, market competition is extremely intensified, general gross profit margin is low, asset-liability ratio is high, amounts of receivables and stocks are high and construction projects are all-sided, contract value is large and the production cycle is long, so the Company has large demands on the funds in order to maintain daily operation and turnover, and is not appropriate to adopt high cash dividend policies.

In order to seize market opportunities, continue to deepen the Company's strategies, enhance structural adjustments and transformation and upgrading, and seek new growth points for benefits, a large amount of capital investment is required in the areas of infrastructure business and overseas business, and appropriate retained earnings need to be accumulated to resolve fund issues during development.

The exact purpose of the Company's retained undistributed profits and estimated earnings
In 2021, the Company will firmly seize new market opportunities and stabilize capital expenditures such as fixed assets, intangible assets, and equity investments to meet the needs of production and development. At the same time, the Company will continue to consolidate and expand shares on traditional advantageous markets such as the railways, highways and urban rails, increase investment in incremental markets, make good use of relevant national supportive policies, and effectively expand room for development in new areas and markets such as the urban construction, environmental governance, new infrastructure construction, public health service infrastructure and prefabricated buildings. The Company will further enhance the intensity of reform, proactively adapt to the investment and financing system reform and market situation, change the investment concept, and accelerate the transformation from a contractor to an "investor + builder + operator". The theme of development of the Company is to accelerate the adjustment of industrial structure based on adherence to the traditional core businesses of the infrastructure sector, strive to promote relevant diversified development and go all out to create more and greater value or returns for the Company and its shareholders.
All the independent directors of the Company express the following
independent opinions on the reasonability of the above 2020 profit distribution plan: ① When formulating the 2020 profit distribution plan, the Company has considered the characteristics of the construction sector, to which the Company belongs, the development stage, the operation mode and funds demands of the Company and
other relevant factors and the plan complies with the actual conditions of the Company. ② The proportion of the cash dividends in 2020 to the net profit attributed to the shareholders of the Company presented in the consolidated statement of profit of the year is 17.5%, consistent with the distribution proportion of 2019, and the net profit keeps rising in each year and the distribution base continues to grow, which, on one hand, guarantees the continuity and sustainable development of the profit distribution policy of the Company and complies with the policy specified in the Articles of Association on cash dividends and middle-and-long-term plans of returns to shareholders, and, on the other hand, not only brings reasonable returns to investment to investors, but also keeps the operation of the Company normal. Therefore, the 2020 profit distribution plan of the Company is reasonable, and the independent directors agree on the profit distribution plan.

5.1.2 The plan or budgets for dividend distribution for ordinary shares or capitalisation of capital reserves of the Company for the latest three years (including the reporting period)

Unit: 100 million Currency: RMB

					Net profit
					attributable
					to the
					Company's	Percentage
					ordinary	in net profit
					shareholders	attributable
					during the	to the
					year of	Company's
					dividend	ordinary
					distribution	shareholders
	Number of	Dividend	Number of		under the	under the
	bonus shares	amount per	shares for	Amount of	consolidated	consolidated
Year of dividend	for every	10 shares	every	cash dividend	financial	financial
distribution	10 shares	(tax inclusive)	10 shares	(tax inclusive)	statements	statements
	(share)	(RMB)	(share)			(%)
2020	0	1.80	0	44.23	251.88	17.5
2019	0	1.69	0	41.52	236.78	17.5
2018	0	1.28	0	29.24	171.98	17

The inclusion of shares repurchased through cash offer in cash dividend Not applicable
If profits for the reporting period and the distributable profit of the parent Company to ordinary shareholders are positive and no profit distribution plan in cash for the ordinary shares is proposed, the Company should disclose the reasons as well as the use and intended use of the retained profits in details

Not applicable

5.2 Performance Status of Undertakings

5.2.1 Undertakings made by undertaking parties, including the ultimate controller, shareholders, related parties, acquirers of the Company and the Company given or subsisting in the reporting period

							If not duly
					Whether		complied,	If not duly
				Timing and	there is a	Whether	describe	complied,
Undertaking	Type of	Undertaking		duration of	deadline for	duly	the specific	describe
background	undertaking	party	Contents of the undertaking	undertaking	performance	complied	reasons	future plans
IPO-related	Non-competition	CREC	Upon the establishment of China Railway in accordance with the	No	No	Yes	/	/
undertakings			law, CREC and its subsidiaries (other than China Railway) will
			not in any form, directly or indirectly, engage in or participate in
			or assist in the engagement or participation in any business that
			competes, or is likely to compete with the core businesses of
			China Railway and its subsidiaries. If CREC or its subsidiaries
			(other than China Railway) become(s) aware of any new
			business opportunity which directly or indirectly competes, or
			is likely to compete, with the core businesses of China Railway,
			it shall notify China Railway in writing of such business
			opportunity immediately upon becoming aware of it, and
			undertakes that priority and a preemptive right of first refusal in
			respect of the business opportunity shall be available to China
			Railway or its subsidiaries. If CREC or any of its subsidiaries
			intends to transfer, sell, lease or license or otherwise assign to
			any third parties or permit them any new business opportunity,
			assets or interests that it may acquire in future and which may
			compete or is likely to compete, directly or indirectly, with the
			core businesses of China Railway, CREC warrants that such
			business opportunity, assets or interests will first be offered to
			China Railway or its subsidiaries.
Undertakings	Other undertakings	CREC	If China Railway is subject to administrative penalties or	Long term	No	Yes	/	/
related to			currently under formal investigation due to any undisclosed
refinancing			violation of laws and regulations in respect of the delay
			in developing acquired land, land speculation, hoarding of
			properties and driving up of property prices by price-rigging,
			which cause losses to China Railway and its investors, CREC
			shall bear the liability for compensation according to the
			requirements of the relevant laws and administrative regulations
			and as required by the securities regulatory authorities.

Note 1: For details of the relevant undertakings made by the Company and CREC during the material asset restructuring of China Railway Erju Co., Ltd. (renamed as CRHIC in March 2017, stock code: 600528), a subsidiary of the Company, please refer to the Report on the Material Asset Swap and Share Issuance for Asset Acquisition, Fundraising and Related Party Transaction of China Railway Erju Co., Ltd. (Revision) disclosed on the website of the Shanghai Stock Exchange (http://www.sse.com.cn) on 21 September 2016. The Company and CREC are currently duly complying with all the undertakings.

Note 2: The Company issued the Letter of CREC on Changing Undertakings on Certain Contingencies to CRHIC on 25 November 2020, pursuant to which, the performance term of the original undertaking in relation to apply for ownership certificates for defective real estate was changed to long-term undertaking. The Letter was considered and approved by the 2020 first extraordinary general meeting of CRHIC on 25 December 2020. For details, please refer to the Announcement of CRHIC on Changing the Performance Term of Undertakings on Certain Contingencies by the Controlling Shareholder of the Company disclosed on the website of the Shanghai Stock Exchange (http://www.sse.com.cn) on 8 December 2020. The Company is currently duly complying with the relevant undertaking.

Note 3: For details of the relevant undertakings made by the Company and CREC during the share issuance for asset acquisition, please refer to the Report on the Share Issuance for Asset Acquisition of China Railway Group Limited (Revision) disclosed on the website of the Shanghai Stock Exchange (http://www.sse.com.cn) on 31 May 2019. The Company and CREC are currently duly complying with all the undertakings.

Note 4: In the course of acquiring the control over China Railway Prefabricated Construction, the Company and CREC issued the Letter of Undertaking to Avoid Horizontal Competition with Beijing Hengtong Innovation Luxwood Technology Co., Ltd., Letter of Undertaking to Regulate Related Party Transactions with Beijing Hengtong Innovation Luxwood Technology Co., Ltd., and Letter of Undertaking to Safeguard the Independence of Beijing Hengtong Innovation Luxwood Technology Co., Ltd. respectively. The above undertakings are continuously effective during the period in which the Company has control over Beijing Hengtong Innovation Luxwood Technology Co., Ltd. The Company and CREC are currently duly complying with the undertakings.

Note 5: In the course of spinning off CRHEEC to go listing on the STAR Market, the Company and CREC issued the Letter of Undertaking to Avoid Horizontal Competition, Letter of Undertaking to Reduce and Regulate Related Party Transactions, Letter of Undertaking to Make up for Diluted Immediate Returns, and other letters of undertakings. For details, please refer to the Plan for China Railway Group Limited on the Spin-off of Its Subsidiary China Railway High-speed Electrification Equipment Corporation Limited to Go Listing on the STAR Market (Revision) disclosed on the website of the Shanghai Stock Exchange on 30 September 2020. The Company and CREC are currently duly complying with all the undertakings.

5.2.2 If the Company has made a profit forecast to its assets or projects, and the profit estimate period is within the reporting period, the Company's explanation on whether its assets or projects would meet its profit forecast and the reasons thereof

Not applicable

1. Fulfillment of undertakings and its impact on goodwill impairment test Not applicable
Fund Appropriation and Progress of Collection During the Reporting Period Not applicable
Explanation of the Company on the "Modified Audit Report" from Auditors Not applicable
Analysis and Explanation of the Company on the Reasons for and Impacts of the Changes in Accounting Policies or Accounting Estimates or Correction of Material Accounting Errors
1. Analysis and explanation of the Company on the reasons for and impacts of the changes in accounting policies or accounting estimates

On 19 June 2020, the Ministry of Finance published the Notice on the Issue of Accounting Rules for Rent Reductions Related to the COVID-19 (the "Notice"), pursuant to which, rent deductions directly incurred by the COVID-19, agreed upon with the lessee and the lessor, and effective prior to 30 June 2021, might be processed with the simplified method in the above Notice. Based on the summary results, upon analysis, the above Notice did not have a material impact on the Company's 2020 financial statements.

5.5.2 Analysis and explanation of the Company on the reasons for and impacts of correction of material accounting errors

Not applicable

Communications with former auditors Not applicable
Others

Not applicable

5.6 Appointment and Removal of Auditors
	Unit: ' 0,000 Currency: RMB
	Current engagement
Name of domestic accounting firm	PricewaterhouseCoopers Zhong Tian LLP
Remuneration of domestic accounting firm	3,110
Term of domestic accounting firm	4 years
Name of international accounting firm	PricewaterhouseCoopers
Remuneration of international accounting firm	220
Term of international accounting firm	4 years
	Name	Remuneration
Accounting firm for internal control audit	PricewaterhouseCoopers	180
	Zhong Tian LLP

Explanation on the appointment and removal of auditors

On 30 March 2020, two resolutions, namely the Resolution on the Appointment of Auditors for 2020 and Resolution on the Appointment of Internal Control Auditors for 2020 were considered and adopted at the thirty-sixth meeting of the fourth session of the Board of Directors. For details of the appointment of auditors, please refer to the Announcement of China Railway Group Limited on Renewal of Appointment of Auditors disclosed on the website of the Shanghai Stock Exchange (www.sse.com.cn) on 31 March 2020. These resolutions were then considered and passed at the 2019 annual general meeting of the Company on 23 June 2020. The Company has engaged PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers as the auditors of the Company for 2020 and engaged PricewaterhouseCoopers Zhong Tian LLP as the internal control auditors for 2020. For details, please refer to the Announcement of China Railway Group Limited on Resolutions of Annual General Meeting of 2019 disclosed by the Company on the website of the Shanghai Stock Exchange on 24 June 2020.

Risk of Suspension of Listing
1. Reason for suspension of listing Not applicable
2. Response measures to be adopted by the Company Not applicable
Delisting and the Reasons Thereof Not applicable
Matters Relating to Insolvency or Restructuring Not applicable
Material Litigation and Arbitration
The Company had no material litigation or arbitration during the year.
Penalty and Rectification Order against the Company and its Directors, Supervisors, Senior Management, Controlling Shareholders, Ultimate Controller and Acquirer
Not applicable
Integrity of the Company and its Controlling Shareholders and Ultimate Controllers during the Reporting Period
During the reporting period, the Company and its controlling shareholder and ultimate controller operated legally by strictly following the requirements of the laws and regulations and normative documents, such as the Company Law and the Securities Law, and duly fulfilled all the undertakings without committing any default. The Company was on the Credit List of Top 500 Listed Companies in China in 2020 as accredited by the China Cooperative Trade Enterprises Association and China Enterprise Reform and Development Society.
Share Incentive Scheme, Employee Stock Ownership Plan and Other Incentive Measures and the Impacts Thereof
1. Incentives which were disclosed in announcement without subsequent progress or changes

Not applicable

5.13.2 Incentives which were undisclosed in announcement or might have had subsequent progress

Not applicable

5.14 Significant Related Party Transactions

5.14.1 Related party transactions in ordinary course of business

Matters which were disclosed in announcement without subsequent progress or changes

Not applicable

Matters which were disclosed in announcement with subsequent progress or changes

				Unit: RMB' 000	Currency: RMB
										Percentage
				Pricing						of transaction
			Particulars	method of	Price of		Amount	value to
		Type of	of the	related	related		of related	the same
	Related	related party	related party	party	party		party	type of
Related parties	relationship	transaction	transaction	transaction	transaction	transaction	transactions
										(%)
China Railway State Assets	Wholly-owned	Receipt of labor	Lease of office	Contract price	16,656				16,656	Less than 1%
Management Co., Ltd.	subsidiary of	services	premises, etc.
	parent company
China Railway State Assets	Wholly-owned	Receipt of labor	Receipt of	Contract price	7,216				7,216	Less than 1%
Management Co., Ltd.	subsidiary of	services	comprehensive
	parent company		services
Total
				23,872				23,872

Description of related party transactions		The above two transactions resulted from the implementation during the
			reporting period of the Premises Leasing Agreement and Comprehensive
			Services Agreement renewed by the Company and CREC on 27 December
			2018. Each of the two agreements has a term of three years. The total
			transaction amount involved was within the decision-making authority of the
			Board of Directors and was considered and approved at the 18th meeting of
			the fourth session of the Board of Directors, which complied with the relevant
			requirements of The Rules Governing the Listing of Stock on Shanghai Stock
			Exchange. Meanwhile, the	Premises Leasing	Agreement and	Comprehensive

Services Agreement were exempted from the requirements of reporting, annual review, announcement and independent shareholders' approval as the annual caps of such transactions were within the de minimis exemption under the Hong Kong Listing Rules.

Matters undisclosed in announcement Not applicable

5.14.2 Related party transactions in relation to acquisition and disposal of assets

Matters which were disclosed in announcement without subsequent progress or changes

Not applicable

Matters which were disclosed in announcement with subsequent progress or changes

Not applicable

Matters undisclosed in announcement Not applicable
If agreement upon performance is involved, the performance achievements during the reporting period shall be disclosed

Not applicable

5.14.3 Significant related party transactions in relation to joint external investment

Matters which were disclosed in announcement without subsequent progress or changes

Not applicable

Matters which were disclosed in announcement with subsequent progress or changes

Not applicable

Matters undisclosed in announcement Not applicable

5.14.4 Amounts due from/to related parties

Matters which were disclosed in announcement without subsequent progress or changes

Not applicable

Matters which were disclosed in announcement with subsequent progress or changes

Not applicable

Matters undisclosed in announcement Not applicable

5.14.5 Others

Related party guarantees

			Unit: RMB' 000 Currency: RMB
		Guarantee	Commencement	Expiry date	Guarantee
Guarantor	Guarantee	amount	date of guarantee	of guarantee	fully fulfilled
CREC (Note)	China Railway	5,000,000	January 2010	July 2020	Yes
CREC (Note)	China Railway	3,500,000	October 2010	April 2026	No
CREC (Note)	China Railway	2,500,000	October 2010	April 2021	No

Notes: These are unconditional and irrevocable joint and several liability guarantees provided by CREC for the entire amount of the 10-year 2010 Corporate Bonds (Tranche 1) issued by the Company in January 2010 and the 15-year 2010 Corporate Bonds (Tranche 2) and 10-year 2010 Corporate Bonds (Tranche 2) issued in October 2010. According to the guarantee period specified in the Company's Prospectus on Public Offering of Corporate Bonds, the guarantee period for the guarantor shall be from the first day of bond offering to six months after the bond maturity date. As at 31 December 2020, 10-year 2010 Corporate Bonds (Tranche 1) and 10-year 2010 Corporate Bonds (Tranche 2) were due and fully settled while the guarantee responsibility of CREC as guarantor of 15-year 2010 Corporate Bonds (Tranche 2) was not yet expired. As at 31 December 2020, the remaining payable amount of abovementioned bonds was RMB3,522,859,000 (31 December 2019: RMB11,266,893,000).

As at 26 July 2020, the related party guarantees provided by CREC for the 10-year 2010 Corporate Bonds (Tranche 1) issued by the Company in January 2010 has been expired and released.

Related party transactions in respect of financial services

		Unit: RMB' 000	Currency: RMB
		31 December	31 December
Item	Related Party	2020	2019
Loans	CREC	1,870,000	150,000
Deposit-taking	CREC	1,132,021	154,569
Deposit-taking	China Railway	175,004	110,025
	State Assets
	Management
	Co., Ltd.

Note: In order to increase the Company's utilisation efficiency of funds, reduce settlement fees, lower interest expenses and obtain funding support, the Proposal on the Financial Services Framework Agreement between China Railway Finance Co., Ltd. and China Railway Engineering Group Co., Ltd. was considered and passed at the 18th meeting of the fourth session of the Board convened by the Company on 7 December 2018, in which it was agreed that China Railway Finance Co., Ltd., a subsidiary of the Company, would renew the Financial Services Framework Agreement (the agreement would expire on 31 December 2021) with CREC, the controlling shareholder of the Company, and provide deposits, loans and other financial services to CREC and its subsidiaries pursuant to the agreement. For details, please refer to the relevant announcement of the Company dated 28 December 2018 disclosed on the website of the Shanghai Stock Exchange.

As at 31 December 2020, the balance of the loan provided by China Railway Finance Co., Ltd. to CREC was RMB1.87 billion. During the reporting period, the daily loan balance (including interest accrued) obtained by CREC from China Railway Finance Co., Ltd. did not exceed the maximum amount stipulated in the Financial Services Framework Agreement; and the maximum daily balance of deposits (including interest accrued) of the deposit service provided by China Railway Finance Co., Ltd. to CREC and its subsidiaries did not exceed the maximum amount stipulated in the Financial Services Framework Agreement.

Other related party transactions

		Unit: RMB' 000	Currency: RMB
			Amount of the
		Amount of the	corresponding
Item	Related Party	current period	period last year
Interest Income	CREC	35,529	112,266
Interest Expense	CREC	8,031	3,344
Interest Expense	China Railway State	1,893	1,701
	Assets Management
	Co., Ltd.
Interest expense on	China Railway State	347	416
lease liabilities	Assets Management
	Co., Ltd.

Note: The interest income represents the interest receivable by China Railway Finance Co., Ltd., a subsidiary of the Company, from CREC for the loans to CREC. The interest expenses represent the interest payable by China Railway Finance Co., Ltd. to CREC and China Railway State Assets Management Co., Ltd. for deposit-taking.

5.15 Material Contracts and Their Performance

5.15.1 Trusteeship, Contracting and Leasing

Trusteeship

Not applicable

Contracting Not applicable
Leasing

Not applicable

5.15.2 Guarantees

Unit: RMB' 000

Currency: RMB

Guarantee provided by the Company (excluding those provided to subsidiaries)

Commencement

Relationship

date of

Guarantee

between

guarantee

Commencement

Guarantee

Counter-

provided

guarantor and

Guarantee

(agreement

date of

Expiry date

Type of

fully

Overdue

guarantee

to related

Guarantor

listed company

Guarantee

amount

execution date)

guarantee

of guarantee

guarantee

fulfilled

Overdue

amount

available

parties

relationship

China Railway

The Company

Linha Railway Co., Ltd.

41,789

2008/6/30

2027/6/20

Suretyship of joint

and several

liability

China Railway

The Company

Yunnan Fuyan Expressway

68,900

2015/4/12

2027/11/1

Suretyship of joint

Co., Ltd.

and several

liability

China Railway

The Company

Shaanxi Yulin Shen-jia-mi

128,340

2015/7/31

2037/8/1

Suretyship of joint

Expressway Co., Ltd.

and several

liability

China Railway No.4

Wholly-owned

Xuzhou Yingbin

119,000

2018/10/22

2018/10/30

2028/10/29

Suretyship of joint

Engineering Group

subsidiary

Expressway

and several

Co., Ltd.

Construction Co., Ltd.

liability

China Railway Major

Wholly-owned

Wuhan Yangsigang Bridge

244,103.25

2015/12/24

2023/6/27

Suretyship of joint

Bridge Engineering

subsidiary

Co., Ltd.

and several

Group Co., Ltd.

liability

China Railway Major

Wholly-owned

Shantou Niutianyang

2,761.53

2019/11/11

2039/8/23

Suretyship of joint

Bridge Engineering

subsidiary

Expressway Investment

and several

Group Co., Ltd.

Development Co., Ltd.

liability

China Railway Tunnel

Wholly-owned

China Shanghai (Group)

5,741.91

2012/12/29

2021/6/30

Suretyship of joint

Group Co., Ltd.

subsidiary

Corporation for

and several

Foreign Economic

liability

& Technological

Cooperation

China Railway Shanghai

Wholly-owned

Fangchenggang

500

2019/5/8

2030/12/31

Suretyship of joint

Group Co., Ltd.

subsidiary

China Railway

and several

Diluyuan Investment

liability

Development Co., Ltd.

China Railway

Wholly-owned

MontagProp Proprietary

6,687

2015/7/3

2023/11/3

Suretyship of joint

International Group

subsidiary

Limited

and several

Co., Ltd.

liability

China Southern

Wholly-owned

Shantou Niutianyang

179,105.82

2019/8/7

2042/8/23

Suretyship of joint

Investment Group

subsidiary

Expressway Investment

and several

Co., Ltd.

Development Co., Ltd.

liability

Total guarantee incurred during the reporting period (excluding those provided to subsidiaries)	-216,491.18
Total balance of guarantee as at the end of the reporting period (A)
(excluding those provided to subsidiaries)	796,928.51
Guarantee provided by the Company to its subsidiaries
Total guarantee to subsidiaries incurred during the reporting period	-365,212.97
Total balance of guarantee to subsidiaries as at the end of the reporting period (B)	4,022,370.19
Aggregate guarantee of the Company (including those provided to subsidiaries)
Aggregate guarantee (A+B)	4,819,298.70
Percentage of aggregate guarantee to net assets of the Company (%)	18.87
Representing:
Amount of guarantee provided to shareholders, ultimate controller and their related parties (C)	0
Amount of debts guarantee directly or indirectly provided to guaranteed parties
with gearing ratios over 70% (D)	4,282,385.17
Excess amount of aggregate guarantee over 50% of net assets (E)	0
Aggregate amount of the above three categories (C+D+E)	4,282,385.17
Statement on the contingent joint and several liability in connection with unexpired guarantee	Not applicable
Statement on guarantee	As at 31 December 2020,
	the aggregate guarantee
	of China Railway Group
	Limited (consolidated)
	in relation to real
	estate mortgage was
	RMB44,683,490,600.

5.15.3 Management of cash assets entrusted to third parties

Entrusted wealth management
1. Overview of entrusted wealth management

		Unit: ' 0,000 Currency: RMB
				Overdue
		Amount	Unexpired	outstanding
Type	Source of funds	incurred	balance	amount
Trust financial product	Self-owned funds	222,375.66	221,375.66	1,000.00

Breakdown of entrusted wealth management

Unit: ' 0,000

Currency: RMB

Future

entrusted

Type of

Amount of

Whether

wealth

Amount of

entrusted

Expected

Actual

followed the

management

impairment

wealth

Commencement

Termination

Source of

Determination

Annualized

gains

gains or

Actual

statutory

plan

provision

Trustee

management

date

funds

Investment target

of returns

yield rate

(if any)

losses

recovery

procedures

available

(if any)

(%)

CCB Trust Co., Ltd.

Trust financial

2,925.00

2016/9/3

2021/9/3

Self-owned

Chengdu Metro Line

By agreement

Yes

product

funds

No. 1, 3 & 7

CCB Trust Co., Ltd.

Trust financial

1,500.00

2014/9/5

2021/9/5

Self-owned

Chongqing Metro

By agreement

Yes

product

funds

Line No. 10

CCB Trust Co., Ltd.

Trust financial

1,500.00

2014/3/11

2021/3/11

Self-owned

Chongqing Metro

By agreement

Yes

product

funds

Line No. 5

CCB Trust Co., Ltd.

Trust financial

1,000.00

2015/12/18

2021/6/18

Self-owned

BT project of

By agreement

10.00

100.00

613.28

Yes

product

funds

roadwork in

Zhaoqing

CCB Trust Co., Ltd.

Trust financial

9,200.00

2018/6/12

2037/9/15

Self-owned

Phase three of

By agreement

6.10

561.20

688.22

Yes

product

funds

PPP project of

roadwork in

Zhaoqing

CCB Trust Co., Ltd.

Trust financial

4,390.00

2020/6/21

2025/6/21

Self-owned

PPP project of

By agreement

6.80

280.96

Yes

product

funds

Hancheng National

Highway 327

China Railway Trust

Trust financial

40,000.00

2016/8/3

2022/8/3

Self-owned

Shandong Tai'an-

By agreement

4.75

12,335.47

10,543.01

20,000.00

Yes

-518.77

Co., Ltd.

product

funds

Dong'e

Expressway

project

China Railway Trust

Trust financial

25,666.67

2016/11/23

2022/11/23

Self-owned

Shandong Weifang-

By agreement

4.75

12,784.45

2,256.18

25,666.67

Yes

-294.89

Co., Ltd.

product

funds

Rizhao

Expressway

project

CITIC Trust Co., Ltd.

Trust financial

100.00

2014/11/1

2021/12/31

Self-owned

BT project of Jiangxi

By agreement

2.00

8.00

Yes

product

funds

Nanchang Jiulong

Lake Tunnel

Future

entrusted

Type of

Amount of

Whether

wealth

Amount of

entrusted

Expected

Actual

followed the

management

impairment

wealth

Commencement

Termination

Source of

Determination

Annualized

gains

gains or

Actual

statutory

plan

provision

Trustee

management

date

funds

Investment target

of returns

yield rate

(if any)

losses

recovery

procedures

available

(if any)

(%)

CITIC Trust Co., Ltd.

Trust financial

54,220.00

2019/5/20

2022/5/20

Self-owned

Shanghai Chunfeng

By agreement

9.50

2,003.91

Yes

product

funds

Project in

Kunming

CCB Trust Co., Ltd.

Trust financial

6,400.00

2016/12/28

2031/12/27

Self-owned

PPP project of

By agreement

5.50

3,520.00

488.88

Yes

product

funds

Liuzhou Guantang

Bridge

Zhonghai Trust Co.,

Trust financial

300.00

2011/4/6

2016/4/7

Self-owned

Capital contribution

By agreement

0.00

Yes

Ltd.

product

funds

to a joint venture

Zhonghai Trust Co.,

Trust financial

700.00

2011/4/6

2016/4/7

Self-owned

Capital contribution

By agreement

0.00

Yes

Ltd.

product

funds

to a joint venture

CITIC Trust Co., Ltd.

Trust financial

27,110.00

2019/5/24

2022/5/24

Self-owned

Kunming Caohai

By agreement

9.50

7,733.41

Yes

product

funds

Dong'an project

CCB Trust Co., Ltd.

Trust financial

720.00

2020/9/18

2026/10/18

Self-owned

Investment

By agreement

Yes

product

funds

cooperation

projects such as the

road project of the

Yanhua Road (East

Ezhou Avenue-

Wudu Avenue) in

Ezhou City, Hubei

Province, and

the infrastructure

project in the

industrial park area

on the west side of

Huama Lake

Impairment provision of entrusted wealth Not applicable

Entrusted loans
1. Overview of entrusted loans

		Unit: ' 0,000 Currency: RMB
				Overdue
		Amount	Unexpired	outstanding
Type	Source of funds	incurred	balance	amount
Entrusted loan	Self-owned funds	318,500.00	318,500.00	0.00

Breakdown of entrusted loans

Unit: ' 0,000

Currency: RMB

Whether

Future

Amount of

Type of

Entrusted

Expected

Actual

followed the

entrusted

impairment

entrusted

loan

Commencement

Termination

Source

Determination

Annualized

gains

gains or

Actual

statutory

loan plan

provision

Trustee

loan

amount

date

of funds

Investment target

of returns

yield rate

(if any)

losses

recovery

procedures

available

(if any)

(%)

China Railway

Entrusted loan

7,500.00

2020/3/10

2023/3/9

Self-owned

Payment of principal

By agreement

4.75

1,068.75

292.92

Yes

134.43

Finance Co., Ltd.

funds

and interest by

Cenxi-Cangwu

Expressway

China Railway

Entrusted loan

16,500.00

2020/3/11

2023/3/10

Self-owned

Payment of principal

By agreement

4.75

2,351.25

642.24

Yes

295.74

Finance Co., Ltd.

funds

and interest by

Yulin-Shenmu

highway

Sales Department of

Entrusted loan

21,700.00

2020/3/11

2023/3/10

Self-owned

Payment of principal

By agreement

4.75

3,092.25

844.64

Yes

388.94

Agricultural Bank

funds

and interest by

of China, Hunan

Pingzheng

Branch

Sales Department of

Entrusted loan

67,000.00

2020/3/10

2023/3/9

Self-owned

Payment of principal

By agreement

4.75

9,547.50

2,616.72

Yes

1,200.87

Agricultural Bank

funds

and interest by

of China, Hunan

Miansui Expressway

Branch

China Railway

Entrusted loan

27,200.00

2020/3/10

2021/3/9

Self-owned

Payment of principal

By agreement

4.79

1,301.52

1,070.14

Yes

268.62

Finance Co., Ltd.

funds

and interest by the

Zhong-Dianjiang

Expressway

China Railway

Entrusted loan

7,500.00

2020/3/10

2023/3/9

Self-owned

Payment of principal

By agreement

4.75

1,068.75

292.92

Yes

134.43

Finance Co., Ltd.

funds

and interest by the

Qianzhou-Xing'an

Expressway

China Railway

Entrusted loan

19,350.00

2020/3/11

2023/3/10

Self-owned

Proceeds from the

By agreement

4.75

2,757.38

753.17

Yes

346.82

Finance Co., Ltd.

funds

acquisition of the

Yulin- Shenmu

Highway by China

Merchants China

Railway Holdings

Co., Ltd. (招商中鐵

控股有限公司)

China Railway

Entrusted loan

151,750.00

2020/3/10

2023/3/9

Self-owned

Gap of capital

By agreement

5.23

23,786.81

6,519.35

Yes

2,722.39

Finance Co., Ltd.

funds

dividends from

China Merchants

China Railway

Holdings Co., Ltd. (招商中鐵控股有限公司)

1. Impairment provision of entrusted loans Not applicable
Others

Not applicable

5.15.4 Other material contracts

Material contracts signed during the reporting period
1. Infrastructure construction

			Date of	Contract	Construction
No.	Signatory	Name of contract	contract	sum	period
				(RMB'0,000)
Railway
1	China Railway No. 2 Engineering,	EPC contract of Sections GZZQ-10,GZZQ-5,	2020.11	1,435,428	47.7-60 months
	China Railway No. 3 Engineering,	GZZQ-8,GZZQ-7,GZZQ-6 and GZZQ-3 of the
	China Railway No. 7 Engineering,	before-station project of the new Guangzhou-
	China Railway No. 10 Engineering,	Zhanjiang High-speed Railway
	China Railway Beijing,
	China Railway Guangzhou
2	China Railway No. 3 Engineering,	EPC contract of Sections SHCG-ZQ6,SHCG-ZQ1	2020.06	917,003	42 months
	China Railway No. 5 Engineering,	and SHCG-ZQ4 of the before-station project of
	China Railway No. 6 Engineering	the Hengshui North-Huanghua Segment of the
		Shijiazhuang-Hengshui-Cangzhou-Huanghua Port
		Intercity Railway
3	China Railway No. 1 Engineering,	Sections HSHZQ-7,HSHZQ-6 and HSHZQ-5 of	2020.06	837,288	1,461 days
	China Railway No. 2 Engineering,	the before-station project (excluding the early	2020.08
	China Railway Guangzhou	commencement segment) of the new Shanghai-
		Suzhou-HuzhouHigh-speed Railway
Highway
1	China Railway No. 4 Engineering and	Sections 12 and 9 of the construction of the Lhasa-	2020.04	622,193	48 months
	China Railway No. 7 Engineering	Shigatse Heping Airport segment of the Ya'an-	2020.05
		Yecheng Expressway
2	China Railway and certain subsidiaries	The project of the Wutong overpass-destination	2020.12	579,569	725 calendar
		segment of the Eastern Transit Expressway in			days
		Shenzhen
3	China Railway Major Bridge	EPC of the Juhua Road West Extension Line project	2020.10	496,999	42 months
	Engineering and other parties	in Foshan City
Municipal works and others
1	China Railway and certain subsidiaries	Phase I project of Changchun Rail Transit Line 5	2020.06	914,767	66 months
2	China Railway and certain subsidiaries	Civil construction of phase I project of Zhengzhou	2020.05	803,681	1,370 calendar
		Metro Line 7			days
3	China Railway and certain subsidiaries	EPC (second) of the rapid transformation project of	2020.12	759,619	1,674 calendar
		the Wanghai Road in Shenzhen city			days

Survey, Design and Consulting Services Business

			Date of	Contract	Contract
No.	Signatory	Name of contract	contract	sum	period
				(RMB '0,000)
1	China Railway Eryuan	Pre-framework supplementary agreement for the	2020.6	185,000	Accept upon
		survey and design of the Ya'an-Linzhi section			completion of
		project of the new Sichuan-Tibet Railway			the project
2	China Railway Consulting	EPC section of the survey and design of the	2020.11	117,528	Accept upon
		Shenzhen-Huizhou Intercity Railway			completion of
					the project
3	China Railway Eryuan	EPC of Chongqing Rail Transit Line 27 and	2020.3	52,500	Accept upon
		Chongqing Rail Transit Line 24			completion of
					the project
	(iii) Engineering Equipment and Component Manufacturing Business
			Date of	Contract
No.	Signatory	Name of contract	contract	sum
				(RMB '0,000)
Manufacturing and installation of steel structures
1	China Railway Shanhaiguan Bridge	Manufacturing, transportation and assembly contracts	2020.09	46,545
		of steel girders of the Niutianyang Expressway and
		the Jinsha West Road West Extension Line
2	China Railway Baoji Bridge	Construction of the manufacturing and installation	2020.06	44,488
		project of steel bridge structures of the Wuhu-
		Huangshan Expressway
3	China Railway Shanhaiguan Bridge	Professional subcontracting contract of the	2020.06	31,096
		construction project of steel truss for the
		Niutianyang Expressway in Shantou
Turnout
1	China Railway Baoji Bridge	Procurement contract of the owner-supply	2020.02	21,288
		merchandise for the (high-speed turnout) of the
		before-station project of the new Beijing-Tangshan
		Railway
2	China Railway Shanhaiguan Bridge	Procurement and sales contract of the owner-supply	2020.01	15,602
		merchandise for the high-speed turnout of the new
		Dunhua-Bahe Railway
3	China Railway Shanhaiguan Bridge	New Mile-Mengzi Railway	2020.04	12,704
Engineering machinery
1	China Railway Engineering Equipment	Procurement contract of tunnel boring machine	2020.04	11,255
2	China Railway Engineering Equipment	Sales & purchase contract of shield tunneling	2020.04	11,200
		machines
3	China Railway Engineering Equipment	Procurement contract of earth pressure balance shield	2020.11	8,370
		machines

	(iv) Real estate development business
		Project		Planned
No.	Project name	location	Project type	area
				(0' 000
				square meters)
1	Shunan headquarters base in Yibin city and	Sichuan	Commercial and	53.65
	supporting residential projects		residential
2	Phase II C settlement building project of Modian	Anhui	Residential	34.35
	Jiayuan in High-tech Zone, Hefei city
3	Phase II settlement building project of Beigang	Anhui	Residential	32.62
	Garden in High-tech Zone, Hefei city
4	Shangma Street project of Chengyang district,	Shandong	Commercial and	32.09
	Qingdao city		residential
5	Settlement building in the eastern part of the central	Shandong	Residential	30.74
	area of the Jimo district in Qingdao city

Material infrastructure investment projects (BOT and PPP projects) signed during the reporting period

			Shareholding of the	Construction	Concession
No.	Name of contract	Signatory	Contract sum project company	period	period	Signing date
			(RMB 100
			million)
1	PPP project contract	China Railway Group	259.8 China Railway holds a	4	34	2020-03
	of the Yiwang-	Limited and other	100% share
	Lingjingdian section	parties (project
	of the G2003 Taiyuan	companies)
	Ring Expressway
	(Taiyuan northwest
	second ring)
2	Concession arrangement	China Railway	222.7 China Railway holds a	3	34	2020-04
	for the project of Cenxi	Communications	20% share
	(border of Guangdong	Investment Group Co.,
	and Guangxi)-Daxin	Ltd. and other parties
	Highway (Hengxian to	(project companies)
	Nanning section)

			Shareholding of the	Construction	Concession
No.	Name of contract	Signatory	Contract sum project company	period	period	Signing date
			(RMB 100
			million)
3	PPP project contract for	China Railway Group	220.9 China Railway holds a	4	29	2020-04
	the national highway	Limited and other	45% share, Beijing
	no. 109 new line	parties (project	Capital Highway
	expressway (west sixth	companies)	Development Group
	ring road-municipal		Co., Ltd. holds a 40%
	boundary section)		share, and Beijing
			Uni.-Construction
			Group Co., Ltd.,
			Beijing Construction
			Engineering Group
			Co., Ltd. and Beijing
			Municipal Road &
			Bridge Corporation
			Limited hold a 5% share
			respectively
4	PPP project contract of	China Railway Group	236.8 China Railway holds a	5	26	2020-06
	Tianjin Metro Line	Limited and other	51% share, and Tianjin
	No.4	parties (project	Rail Transit Group Co.,
		companies)	Ltd. holds a 49% share
5	PPP project contracts	China Railway Group	280.4 China Railway holds a	4	34	2020-12
	for the Dapuchaihe-	Limited and other	51% share, and Jilin
	Chimney Hill of the	parties (project	Provincial Expressway
	Yanji-Changchun	companies)	Group Co., Ltd. holds a
	Expressway, the		49% share
	Chimney Hill-
	Changchun section of
	the Yanji-Changchun
	Expressway, and the

Huanren (province boundary)-Ji'an section of the Benxi-Ji'an Expressway

Material infrastructure investment projects (BOT and PPP projects) operated during the reporting period

					Time of
					entering the
			Contract	Signing	operation	Operation
No.	Name of contract	Signatory	sum	date	period	period
			(RMB 100
			million)
1	PPP project of phase I	China Railway Group	146.79	2016-9	2019-12-29	25 years
	project of Hohhot Metro	Limited and other parties
	Line 1
2	PPP project of the	China Railway Group	56.9	2017-04	1/1/2020	30 years
	Dongchuan-Gele section	Limited and other parties
	of the S25 Kunming-
	Qiaojia Expressway
3	PPP project of the Xundian-	China Railway Group	61.1	2018-08	1/1/2020	30 years
	Zhanyi Expressway	Limited and other parties
	(Kunming section)

Strategic framework agreements signed during the reporting period

No.	Agreement name	Signing date	Main contents of agreements
1	Framework agreement on investment	2020.06	The two parties intend to actively
	cooperation between China Railway Group		innovate	cooperation models	and
	Limited and Changchun Municipal People's		carry out in-depth cooperation in the
	Government		fields of urban facilities construction,
			cultural tourism and health care, park
			development,	ecological environment,
			old	city renovation, environmental
			protection and water affairs, and
			airports to ensure high - quality
			implementation of projects.
2	Strategic cooperation agreement between	2020.06	Cooperate with the Daxing District
	the Daxing District People's Government in		People's Government in Beijing in
	Beijing and China Railway Group Limited		infrastructure	construction,	old	city
			renovation,	district development,
			ecological restoration and other fields
3	Strategic cooperation agreement between	2020.06	T h e	t w o	s i d e s i n t e n d	t o	t a k e
	the People's Government of Heilongjiang		infrastructure	construction and	other
	Province and China Railway Group Limited		key projects as the first batch of
			projects in which they will cooperate,
			to carry out all-round cooperation
			in planning, surveying,	design,
			investment and financing, construction,
			operation	and	management,	industrial
			manufacturing and other fields across
			the whole industry chain.

No.	Agreement name	Signing date	Main contents of agreements
4	Cooperation agreement on integrated	2020.06	The two parties intend to carry
	development projects along the railway		out in-depth cooperation in TOD
	line between Hubei Province Railway		development,	district	development,
	Construction Investment Group Co., Ltd.		real estate development and emerging
	and China Railway Group Limited		urbanization.
5	Strategic cooperation agreement between	2020.07	Around the investment and construction
	the Guangxi Zhuang Autonomous Region		of infrastructure projects, public
	and China Railway Group Limited		service projects and other projects
			in the Guangxi Zhuang Autonomous
			Region, the two parties carry out all-
			round cooperation in major urban
			infrastructure, rail transit, expressways,
			a i r p o r t s , p o r t w h a r f s , w a t e r
			conservancy, environmental protection,
			industrial funds,	characteristic
			towns, railways and integrated land
			development along railways, sponge
			cities and underground pipe corridors.
6	Strategic cooperation framework agreement	2020.07	C o o p e r a t e	w i t h	t h e	P e o p l e ' s
	between the People's Government of		Government of Baoding Municipality
	Baoding Municipality and China Railway		in industrial	park	construction,
	Group Limited		comprehensive	urban	development,
			comprehensive	water	environment
			remediation and ecological restoration.
7	Cooperation framework agreement between	2020.08	The two parties intend to cooperate
	the People's Government of Jilin Province		on projects in the areas of urban
	and China Railway Group Limited		infrastructure,	national	and	provincial
			road networks, urban rail, municipal
			w o r k s , n e w i n f r a s t r u c t u r e , o l d
			c i t y r e n o v a t i o n , e n v i r o n m e n t a l
			protection and	water	conservation,
			water management,	industrial park,
			cultural tourism and health care,
			expo exhibition, urban area complex
			development and general airport.
8	Strategic cooperation agreement between	2020.09	The two parties intend to carry out
	the People's Government of Anhui Province		extensive cooperation in the fields of
	and China Railway Group Limited		new rail transit, high-end equipment
			m a n u f a c t u r i n g a n d i n t e l l i g e n t
			manufacturing,	infrastructure, financial
			innovation, the "Belt and Road", the
			integrated development of the Yangtze
			River Delta, and rural revitalization.


No.	Agreement name	Signing date	Main contents of agreements
9	Strategic cooperation agreement between	2020.09	Cooperate	with China Metallurgical
	China Railway Group Limited and China		G e o l o g y	B u r e a u	i n	i n d u s t r i a l
	Metallurgical Geology Bureau		infrastructure	construction, geological
			exploration	of mineral	resources,
			investment and development of mineral
			resources,	geographic information,
			ecological	improvement, superhard
			material,	and manufacturing of
			mechanized equipment.
10	Strategic cooperation agreement between	2020.09	Cooperate with Shandong Port Group
	Shandong Port Group Co., Ltd. and China		Co., Ltd. In special railway lines,
	Railway Group Limited		logistics park development, inland
			port construction, port infrastructure
			construction and other fields.
11	Strategic cooperation framework agreement	2020.11	C o o p e r a t e	w i t h	t h e	P e o p l e ' s
	between the People's Government of		Government of Nanchang Municipality
	Nanchang Municipality and China Railway		in urban rail transit, municipal public
	Group Limited		works,	urban renewal,	highways,
			water	conservancy,	environmental
			protection, new infrastructure and other
			fields by means of equity cooperation,
			investment	and financing	construction,
			PPP, EPC, general contracting and
			other project construction models
			approved by both parties in an all-
			round way.

5.15.5 Particulars of material properties

Property held for development

						Expected	Interests of the
Name of building		Current			State of	completion	Company and
or project	Address	land use	Area	Floor area	completion	date	its subsidiaries
			(0'000	(0'000
			square meters)	square meters)
Sichuan Heilongtan	Renshou County,	Comprehensive	2,266	1,418	Under	2027	100%
International Eco Tourism	Meishan, Sichuan				construction
Resort Project
Guiyang China Railway	Guanshan Lake District,	Commercial,	236	266	Under	2024	80%
Yueshan Lake	Guiyang, Guizhou	residential			construction
Qingdao West Coast Project	West Coast Central	Comprehensive	86.39	148.3	Under	2029	100%
	Vitality Zone, Qingdao				construction
Taiyuan China Railway	Chaoyang Street, Yingze	Commercial,	27.66	125	Under	2024	100%
Nuode Mall	District, Taiyuan	residential			construction
Guiyang Qingzhen Project	Xiangchou Residential	Commercial,	45.47	104.8	Under	2027	90%
	Quarters, Vocational	residential			construction
	Education Area,
	Qingzhen, Guiyang
	City, Guizhou

Property held for investment

				Interests of
				the Company
				and its
Name	Location	Use	Tenure	subsidiaries
Beijing Nuode Center Phase III	No. 1 South Yuren Road, Fengtai District, Beijing	Commercial	2054-11	100%
Building S1, S2, 16 and 19
Tianjin Nuode Center No. 1	No. 50 Lvwei Road, Hebei District, Tianjin	Commercial	2054-01	100%
Building, No. 2 Building and
equipped facilities
Beijing China Railway Mansion	No. 3 Yard, South Automobile Museum Road,	Commercial	2065-11	100%
	Fengtai District, Beijing
Guangzhou Nuode Center	No. 477 East Hanxi Avenue, Nancun Town, Panyu	Commercial	2053-05	100%
	District, Guangzhou City, Guangdong
Chengdu Nuode No. 1	Intersection of Guangxi Road and Huanhu Road,	Commercial	2065-01	100%
	Shuangliu District, Chengdu, Sichuan
Shanghai Nuode International	3/5 Block, 219 Lane, Xinzhuang Town, Minhang	Commercial	2064-03	100%
Plaza	District, Shanghai
China Railway Real Estate	No. 8 Hong Kong Middle Road, South City	Commercial	2046-07	100%
Qingdao Center	District, Qingdao, Shandong
Reeda Plaza	No. 46 South Shengli Road, Heping District,	Commercial	2051-04	100%
	Shenyang, Liaoning
Wood-Plastic R&D Building	No. 86-5 Wanxing Road, Changyang Town,	R&D and	2053-06	100%
	Fangshan District, Beijing	commercial
China Railway South Headquarters	No. 3333 Houhai Center Road, Nanshan District,	Commercial	2046-12	100%
Building	Shenzhen, Guangdong

Explanation for Other Significant Events Not applicable
Proactive Fulfilment of Social Responsibilities

5.17.1 Poverty relief efforts of the Company

Targeted poverty alleviation planning

2020 was the year for achieving the goal of building a moderately prosperous society in all respects. It was also the final year for poverty alleviation. According to the national unified plan and responding to the call of the Party and the state, the Company actively fulfilled its obligations as a central enterprise, and regarding the key and difficult problems, carried out thematic research, initiated projects specifically, made centralized investments, and made major breakthroughs. The Company strengthened the construction of rural infrastructure, improves the quality of rural education, strengthened social security in rural areas, and improved public cultural services in rural areas. The Company took effective measures to shore up the weak spots of rural development. Focusing on helping build a mechanism of poverty alleviation, the Company promoted the effective combination of poverty alleviation through consumption and targeted assistance, to ensure that policies really benefited registered impoverished households. The Company stimulated the internal driving force for registering poverty-stricken households, to realize the goal of getting rid of poverty, not returning to poverty and becoming well-off. The Company took targeted measures to help those in need, arranged projects, used funds, and achieved poverty alleviation.

Summary of annual targeted poverty alleviation

During the reporting period, 28 subordinate enterprises of the Company actively participated in poverty alleviation and invested in a total of RMB169.5035 million in poverty alleviation. They helped 1,326 registered impoverished people get rid of poverty, and financed 4,443 poor students. They purchased RMB15.1769 million of agricultural products from targeted poverty alleviation counties, RMB1.1287 million of agricultural products from other impoverished counties and RMB5.0554 million of agricultural products from Hubei province, and helped sell RMB1.6489 million of agricultural products. The Company invested RMB63.90 million of special funds in designated counties receiving assistance from the Company, attracted RMB79.94 million of assistance funds for targeted poverty alleviation counties, trained 213 grass-root cadres, and trained 7,226 professional and technical personnel for targeted poverty alleviation counties and other poverty-stricken areas.

In 2020, after the three designated poverty alleviation counties got rid of poverty, the Company continued to maintain the efforts to alleviate poverty, comprehensively consolidate poverty alleviation results, and effectively link poverty alleviation with rural revitalization First, China Railway's poverty alleviation has been praised and come to the notice of the General Secretary. General Secretary Xi Jinping praised Zhashui's fungus plantation as "small fungus, big business" when inspecting projects such as intelligent multi-block fungus greenhouses in Jinmi Village, Zhashui County, Shaanxi Province, which were invested in and built by the Company. He also went to the Shazhou Yaozu Village, Rucheng County (a designated poverty-stricken county receiving assistance from the Company), Hunan Province and visited an exhibition hall themed "warmth of half of a quilt". He commented that "half of a quilt warms the hearts of people, and the Party and the people are close as fish and water" and praised the poverty alleviation deeds of China Railway. Second, the Company's leaders have led a number of teams to investigate designated poverty alleviation counties, to understand the consolidation of poverty alleviation results and overcome practical difficulties. Third, the Company performed a solid job of construction of key projects, and promoted the effective linkage between poverty alleviation and rural revitalization. Staying focused on the weak spots of education and transportation infrastructure in poverty alleviation counties, the Company invested in RMB60 million special funds in promoting the effective link between comprehensive poverty alleviation and rural revitalization. The Company assisted the construction of a school that implements the nine-year system in Zhaqian Town, Guidong County, Hunan Province, and donated 1 teaching building for the Vocational Skills Education Center in Rucheng County, Hunan Province. The Company joined hands with a local private enterprise in Baode County, Shanxi Province, to construct the north section of the "China Railway Xingfu Avenue". Fourth, the Company helped solve the problem of slow-selling of agricultural products in poor areas by intensifying poverty alleviation through consumption. The Company encouraged subordinate units and the vast number of cadres and employees to intensify purchase and consumption efforts. The Company set up a special section on its internal e-commerce platform (Luban Mall), to display and sell the agricultural products from targeted poverty alleviation counties for a long time, and issued agricultural products from impoverished counties instead of labour protection supplies, which gives a strong impetus to the sale of agricultural products from impoverished counties.

Effectiveness of targeted poverty alleviation efforts

Unit: ' 0,000 Currency: RMB

Indicators

I. General

Including: 1. Fund

2. Materials converted into cash

3 Number of registered impoverished people relieved from poverty under the help offered (person)
Investment Breakdown
1. Poverty alleviation through industrial development Including: 1.1 Type of industrial projects for
2. 1. poverty alleviation
  2. Number of industrial projects for poverty alleviation
  3. Amount of investment in industrial projects for poverty alleviation
  4. Number of registered impoverished people relieved from poverty under the help offered (person)
3. Poverty alleviation through transferred employment Including: 2.1 Amount of investment in occupational
4. 1. skill training
  2. Number of persons receiving vocational skill training (person/time)
  3. Number of registered impoverished people getting employed under the help offered (person)
5. Poverty alleviation through relocation

Including: 3.1 Number of employment for relocated household (person)

4. Poverty alleviation through education

Including: 4.1 Amount of investment in financing

needy students

Number of poor students financed (person)
Amount of investment in improving the educational resources in poverty-stricken areas

Quantity & Implementation

16,950.35

522.57

1,326

" Agricultural and forestry poverty alleviation" " Tourism poverty alleviation"

"E-commerce poverty alleviation"

" Asset income poverty alleviation"

"□Science and technology poverty alleviation"

" Others"

970.30

638

189.71

7,226

1,410

284.42

4,443

12,783.60

Indicators

5. Poverty alleviation through health

Including: 5.1 Amount of investment in the medical and health resources of poverty-stricken areas

Poverty alleviation through ecological protection Including: 6.1 Name of Project
6.2 Amount of investment
Baseline security

Including: 7.1 Amount of investment in helping "the elderly people, women and left-behind children in rural areas"

Number of "elderly people, women and
left-behind children in rural areas" helped (person)
Amount of investment in helping needy disabled people
Number of needy disabled people helped (person)

8. Poverty alleviation through society

Including: 8.1 Amount of investment in coordinated eastern-western poverty alleviation

Amount of investment in precision poverty alleviation
Public social charitable fund for poverty alleviation

Quantity & Implementation

0.00

" Commencing ecological protection and construction" " Devising ways of ecological protection compensation"

" Setting up ecological charity job positions" "□Others"

8.9

7.19

121

15.17

253

6,390

18.60

9. Other projects
Including: 9.1	Number of projects	38
9.2	Amount of investment	1,588.27
9.3	Number of registered impoverished	688
	people relieved from poverty under
	the help offered (person)
9.4	Description about other projects	/

1. Awards Received (Nature and Level)
2. 1. The Labour Union of China Railway No. 1 Engineering has won the honorary title of National Advanced Collective of Poverty Alleviation National
  2. Liu Xiaoying from China Railway No. 3 Engineering who is a cadre staying at the Tuanwo village for poverty alleviation has won the honorary title of National Advanced Individual of Poverty Alleviation National
  3. Zhang Zhongwen from China Railway No. 1 Engineering has won the "Contribution Award" for poverty alleviation in Shanxi Province and has been rated as a model worker in Xinzhou city Provincial and ministerial
  4. China Railway No. 1 Engineering has won the "Excellence Award for Boosting Poverty Alleviation in Shaanxi Province in 2019" Provincial and ministerial
  5. China Railway No. 1 Engineering has won the "Charitable Enterprise in Shaanxin Province" in the 3rd appraisal Provincial and ministerial
  6. He Zheng from China Railway No. 2 Engineering has won the honorary title of Advanced Individual in Poverty Alleviation for 2019 in Sichuan Province Provincial and ministerial
  7. Liu Xiaoying from China Railway No. 3 Engineering has won the honorary title of a Model Cadre in Assistance Work Staying at Villages in Shanxi Province and the First Secretary in Rural Areas Provincial and ministerial
  8. China Railway No. 3 Engineering has won the honorary title of "Model Unit in Assistance Work by Cadres Staying at Villages" in Shanxi Province Provincial and ministerial
  9. Zheng Jiawei from China Railway No. 4 Engineering who is a cadre staying at the Wangli village for poverty alleviation has been rated as a "Good Person in Anhui Province" Provincial and ministerial
  10. Chen Tiandi from China Railway Eryuan has won the honorary title of "Good Person for Poverty Alleviation in Anhui Province" Provincial and ministerial
  11. Dai Chang from China Railway Major Bridge Design Institute has won the honorary title of Provincial Excellent Lead of the Working Team Staying at Villages and First Secretary in 2019 and Provincial Excellent Member of the Working Team Staying at Villages in 2019 Provincial and ministerial
Subsequent Targeted Poverty Alleviation Plan

2021 is the first year of the "14th Five-Year Plan". It is also the first year for transition from poverty alleviation to rural revitalization and for embarking on the road to building a modern socialist country in all respects. China Railway will conscientiously implement the new strategies and new requirements of the Party Central Committee, the State Council and SASAC for consolidating poverty alleviation results and linking poverty alleviation with rural revitalization, to see that the mechanism, policy and system of targeted assistance are implemented smoothly and in an orderly manner. First, the Company will perform the various aspects of work in an coordinated way and comprehensively consolidate poverty alleviation results. Based on the principle of "eliminating poverty without evading responsibilities, policies, assistance or supervision", the Company maintains the overall stability of the policy and level of support. Second, the Company will exert its utmost to provide targeted assistance to Tibet. The

Company will carry out in-depth investigation, propose scheme and dispatch outstanding cadres to assume a temporary post, to support the economic development of Karuo District, Chamdo Prefecture, Tibet Autonomous Region. Third, the Company will provide guidance for and urges cadres assuming a temporary post to provide assistance well. The Company will deliver a good job in the re-election of the new round of cadres assuming a temporary post, to see that the assistance work is handed over smoothly. The Company will also actively provide trainings on those who take the lead in becoming prosperous through business startups, to lift the whole village from poverty with the help of these foregoers. Fourth, the Company will strengthen the asset management and supervision of poverty alleviation projects. The Company will implement the management and protection responsibilities, clearly define regulatory responsibilities, ensure the proper use of assets, and continue to carry out supervision and inspection in the field of assistance. The Company will take targeted measures to help those in need, arrange projects, use funds, and achieve poverty alleviation. Fifth, the Company will strengthen the assessment and placement of cadres assuming a temporary post for poverty alleviation. The Company will handle properly the assessment and post arrangement of cadres assuming a temporary post after they have accomplished their tasks, to make the assumption of a temporary post a platform for training and cultivating the cadres.

5.17.2 Social responsibility commitments

As a leading enterprise in the construction industry, the Company has always taken being a practitioner, promoter and leader as its corporate social responsibilities. Since 2008, China Railway has started setting up a scientific, regulated, systematic and effective mechanism for corporate social responsibility management system. Based on the ten aspects of social responsibility planning, namely legal corporate governance, quality services, efficiency creation, employee development, safety supervision, technological advancement, environmental protection, charity, win-win cooperation and overseas responsibilities, a series of corporate social responsibility activities was launched in the headquarters and subsidiaries of the Company, with an aim to achieve the goals of complete coverage, full performance, gradual improvement and industry leadership in social responsibilities, making continuous outstanding contribution to the society.

5.17.3 Environmental protection information

Description of environmental protection efforts of the highly polluting companies and their key subsidiaries as announced by the environmental protection authority

Not applicable

Description of environmental protection efforts of companies other than highly polluting companies

The Company thoroughly implemented thoughts on ecological civilization, established the concept of green development, and implemented the decision-making of the Party Central Committee and the State Council on the construction of ecological civilization and environmental protection. Guided by "Ecological Priority and Green Development", the Company continued to improve the environmental management system and clarified the environmental protection management mode. With regards to environmental management, the Company upheld the principle of "Territorial Management", "Prevention First, Combined with Prevention and Control" and "Who Pollutes, Who Controls". As for the management mode, the Company implemented unified leadership while subsidiaries and branches at each level are responsible, to ensure the orderly and controllable environmental protection. In terms of assessment, the Company conscientiously implemented the reward and punishment system for energy conservation and ecological environmental protection, strengthened the assessment objectives, and implement accountability for ecological and environmental issues seriously. In terms of the systematic environmental management, the Company has obtained ISO14001 environmental management system certification from China Certification Center Inc.

According to the requirements of the Notice of China Railway on Further Strengthening the Protection of the Ecological Environment, the Notice of China Railway on the Earnest Implementation of the "Three-Year Action Plan for the Fight to Defend the Blue Skies" to Strengthen the Prevention and Control of Air Pollution and other management documents, the Company further strengthened the protection of ecological environment throughout the Company. By identifying and evaluating environmental factors of construction projects and workplaces, the Company determined the environmental factors under key control, prepared environmental management plans for projects, established a monitoring system for ecological environmental protection, and strengthened control over the risk sources of ecological environment pollution and pollutant emissions during production, to protect and improve the living and ecological environment. Meanwhile, the Company strengthened the inspection of ecological environmental protection of projects during safe production, and supervised the units concerned to make rectifications within a prescribed time limit. In 2020, the Company organized member companies to prepare and revise the Administrative Measures for Ecological Environmental Protection of the Company, improved the supporting management system, and formulated and refined a series of bylaws including the Administrative Measures for Environmental Protection on Construction and Installation Sites, Administrative Measures for Environmental Protection on Construction, Regulations on Environmental Management for Boiler Houses, Administrative Measures for the Recovery and Utilization of Waste Materials, Regulations on Environmental Management for Metal Welding and Gas Cutting Operations, Administrative Measures for Environmental Management for Machinery and Equipment, Regulations on Environmental Management of Warehouses, Regulations on Management of Hazardous Wastes, Regulations on Environmental Sanitation Management on Production Sites, Regulations on the Management of Power Consumption and Regulations on the Management of Water Conservation, to ensure that there are rules to go by, the rules are observed, and supervision is conducted on good grounds in respect of the daily environmental management. The Company established a statistical monitoring platform for ecological environment protection and collected ecological environment monitoring data on a regular basis, to improve the intuitiveness and truthfulness of the information about ecological environment protection.

In 2020, the Company supervised and inspected the environmental protection of project under constructions, environmental impact assessment system, and "three simultaneous" and environmental protection measures at all levels. First, the functions of ecological environment protection and energy conservation management were integrated, to promote the integrated construction of organization and management systems of environmental protection and energy conservation. According to the actual management of energy conservation and ecological environment protection of SASAC, the Company improved the organizational settings and revised and improved the management methods, to see that energy conservation and ecological environment protection were carried out in an all-round way. Second, the statistical monitoring system was comprehensively upgraded, and new report data filling online was achieved. Third, the Company strictly implemented the reward and punishment system for ecological environmental protection. At the beginning of 2020, the Company set out targets of ecological environmental protection, energy conservation and consumption reduction, requiring various subsidiaries to achieve the targets within all levels of organization. Reward and punishment measures have been taken seriously in order to give effective motivation to protect the environment. Fourth, the Company carried out the technical research and development of ecological environmental protection in an all-round way, and put a high premium on green construction, scientific and technological research, and exemplary role of engineering projects.

For the Company's specific environmental protection work in 2020 and the results achieved, please refer to the Social Responsibility Report and ESG (Environment, Social and Governance) of China Railway Group Limited for 2020 as disclosed on the website of Shanghai Stock Exchange together with this announcement by the Company.

Explanation of reasons for the undisclosed environmental information of the Company other than highly polluting companies

Not applicable

Explanation of the subsequent progress or changes in the disclosure of environmental information content during the Reporting Period

Not applicable

Others

Not applicable

5.17.4 Convertible Corporate Bonds Not applicable

6	FINANCIAL REPORT
	Consolidated Income Statement
			Year ended 31 December
		Note	2020		2019
			RMB million	RMB million
	Revenue	3	974,732		850,843
	Cost of sales and services		(884,380)	(770,979)

	Gross profit		90,352		79,864
	Other income	4	2,219		1,996
	Other expenses	4	(21,838)	(16,511)
	Net impairment losses on financial assets and
	contract assets	5	(2,556)	(4,507)
	Other gains, net	6	662		5,705
	Losses from derecognition of financial assets
	at amortised cost	7	(3,302)	(3,367)
	Selling and marketing expenses		(5,020)	(4,605)
	Administrative expenses		(24,668)	(24,474)

	Operating profit		35,849		34,101
	Finance income		4,324	2,200
	Finance costs		(6,756)	(5,574)
	Share of post-tax profits of joint ventures		164	360
	Share of post-tax profits of associates		2,031	2,100

	Profit before income tax		35,612		33,187
	Income tax expense	8	(8,362)	(7,808)

	Profit for the year		27,250		25,379
	Profit attributable to:
	- Owners of the Company		25,188		23,678
	- Non-controlling interests		2,062	1,701

			27,250		25,379
	Earnings per share for profit attributable


	to owners of the Company
	(expressed in RMB per share)
	- Basic	9	0.963		0.950
	- Diluted	9	0.963		0.950

Consolidated Statement of Comprehensive Income
	Year ended 31 December
Note	2020		2019
	RMB million	RMB million
Profit for the year	27,250		25,379
Other comprehensive income/(expenses),
net of income tax
Items that will not be reclassified to profit or loss:
Remeasurement of retirement and
other supplemental benefit obligations	1		(16)
Income tax relating to remeasurement of
retirement and other supplemental
benefit obligations	2		-
Changes in the fair value of equity
investments at fair value through
other comprehensive income	(260)	(94)
Income tax relating to changes in the
fair value of equity investments at
fair value through other comprehensive income	63		17

	(194)	(93)
Items that may be reclassified subsequently to

profit or loss:
Exchange differences on translating foreign
operations	(500)	114
Share of other comprehensive income of associates	(189)	42
Fair value gains on cash flow hedging
instrument, net of deferred tax	-	1

	(689)	157
Other comprehensive (expenses)/income for
the year, net of tax	(883)	64

Total comprehensive income for the year	26,367		25,443
Total comprehensive income for the year


attributable to:
- Owners of the Company	24,377		23,736
- Non-controlling interests	1,990		1,707

	26,367		25,443

Consolidated Balance Sheet
		As at 31 December
	Note	2020		2019
		RMB million	RMB million
ASSETS
Non-current assets
Property, plant and equipment		74,384		68,406
Right-of-use assets		1,892	2,229
Lease prepayments		14,826	13,198
Deposits for investments		453	1,098
Investment properties		12,046	11,167
Intangible assets		62,599	25,559
Mining assets		3,582	3,732
Contract assets		111,209	87,885
Investments in joint ventures		40,216	29,314
Investments in associates		38,133	30,565
Goodwill		1,412	1,040
Financial assets at fair value through other
comprehensive income		9,668	10,472
Other financial assets at amortised cost		18,773	13,929
Financial assets at fair value through profit or loss		10,564	8,637
Deferred tax assets		9,333	8,012
Other prepayments		429	345
Trade and other receivables	11	48,351		30,683

		457,870		346,271
Current assets

Lease prepayments		319		356
Properties held for sale		34,143	25,018
Properties under development for sale		117,576	133,776
Inventories		40,943	40,945
Financial assets at fair value through other
comprehensive income		522	393
Trade and other receivables	11	211,568		203,256
Contract assets		143,904	130,155
Current income tax recoverable		3,451	2,641
Other financial assets at amortised cost		9,694	9,630
Financial assets at fair value through profit or loss		5,218	5,441
Restricted cash		29,305	19,973
Cash and cash equivalents		145,464	138,186

		742,107		709,770
Total assets		1,199,977		1,056,041

		As at 31 December
	Note	2020		2019
		RMB million	RMB million
EQUITY
Equity attributable to owners of the Company
Share capital		24,571		24,571
Share premium and reserves		183,888	165,204
Perpetual notes		46,738	31,535

		255,197		221,310
Non-controlling interests		57,849	24,018
Total equity		313,046		245,328
LIABILITIES


Non-current liabilities
Trade and other payables	12	7,983		7,681
Borrowings		166,997	118,934
Lease liabilities		1,237	1,450
Retirement and other supplemental benefit
obligations		2,482	2,770
Provisions		562	1,053
Deferred government grants and income		1,071	1,007
Deferred tax liabilities		1,454	1,784

		181,786		134,679
Current liabilities

Trade and other payables	12	488,304		446,037
Contract liabilities		124,660	110,370
Current income tax liabilities		7,969	5,824
Borrowings		83,058	112,311
Lease liabilities		526	1,037
Retirement and other supplemental benefit
obligations		323	359
Financial liabilities at fair value through
profit or loss		65	85
Provision		240	11

		705,145		676,034

Total liabilities		886,931		810,713


Total equity and liabilities		1,199,977		1,056,041

Notes:

GENERAL INFORMATION
China Railway Group Limited (the "Company") was established in the People's Republic of China (the "PRC") on 12 September 2007 as a joint stock company with limited liability, as part of the group reorganisation ("Reorganisation") of China Railway Engineering Group Company Limited ("CREC") in preparation for the listing of the Company's A shares on Shanghai Stock Exchange and H shares on the Main Board of The Stock Exchange of Hong Kong Limited (the "HKSE").
The address of the Company's registered office is 918, Block 1, No.128 South 4th Ring Road West, Fengtai District, Beijing, the PRC. The Company's ultimate holding company is CREC, established in the PRC.
The Company and its subsidiaries (together, the "Group") are principally engaged in infrastructure construction, survey, design and consulting services, engineering equipment and component manufacturing, property development, mining and merchandise trading, financial trust management, comprehensive financial services and insurance agent.
These consolidated financial statements are presented in Renminbi ("RMB"), unless otherwise stated.
These consolidated financial statements have been approved for issue by the Board of Directors on 30 March 2021.
BASIS OF PREPARATION
The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board ("IASB") and interpretations issued by the IFRS Interpretations Committee ("IFRS IC") applicable to companies reporting under IFRS.
The consolidated financial statements have been prepared on a historical cost basis, except for certain financial assets and liabilities (including derivative instruments) measured at fair value.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group's accounting policies.

Amended standards adopted by the Group
The following amended standards have been adopted by the Group for the first time for the financial year beginning on 1 January 2020.

	Effective for
	accounting
	periods
	beginning
	on or after
Amendments to IAS 1 and IAS 8 "Definition of Material"	1 January 2020
Amendments to IFRS 3 "Definition of a Business"	1 January 2020
Amendments to IFRS 9, IAS 39 and IFRS 7 "Interest Rate Benchmark Reform"	1 January 2020
Revised Conceptual Framework for Financial Reporting	1 January 2020

The adoption of above did not have any material impact on the Group's results for the year ended 31 December 2020 and the Group's financial position as at 31 December 2020. The Group did not have to change its accounting policies or make retrospective adjustments as a result of adopting these amended standards.

The Group also elected to adopt the following amendments early.

Effective for accounting periods beginning on or after

Amendments to IFRS 16 "COVID-19-Related Rent Concessions"

1 June 2020

The Group has early adopted Amendments to IFRS 16 COVID-19-Related Rent Concessions retrospectively from 1 January 2020. The amendment provides an optional practical expedient allowing lessees to elect not to assess whether a rent concession related to COVID-19 is a lease modification. Lessees adopting this election may account for qualifying rent concessions in the same way as they would if they were not lease modifications. The practical expedient only applies to rent concessions occurring as a direct consequence of the COVID-19 pandemic and only if all of the following conditions are met:

the change in lease payments results in revised consideration for the lease that is substantially the same as, or less than, the consideration for the lease immediately preceding the change; b) any reduction in lease payments affects only payments due on or before 30 June 2021; and c) there is no substantive change to other terms and conditions of the lease.

The Group has applied the practical expedient to all qualifying COVID-19-related rent concessions. The adoption did not have material impact on the Group results for the year ended 31 December 2020. There is no impact on the opening balance of equity at 1 January 2020.

New and amended standards not yet adopted by the Group
Certain new and amended standards are effective for annual periods beginning after 1 January 2020, and have not been applied in preparing the consolidated financial statements.

IFRS 17 "Insurance Contracts"

Amendments to IFRS 3 "Reference to the Conceptual Framework"

Amendments to IAS 16 "Property, Plant and Equipment: Proceeds before intended use" Amendments to IAS 37 "Onerous Contracts - Cost of Fulfilling a Contract"

Annual Improvements to IFRS Standards 2018-2020 affecting IFRS 1, IFRS 9, IFRS 16 and IAS 41

Amendments to IAS 1 "Classification of Liabilities as Current or Non-current" Amendments to IFRS 10 and IAS 28 "Sale or contribution of assets between

an investor and its associate or joint venture"

Effective for accounting periods beginning on or after

1 January 2023

1 January 2022

1 January 2023

to be determined

The adoption of above new and amended standards will have no material impact on the Group's results and financial position.

3 SEGMENT INFORMATION

The Directors are the chief operating decision maker. Management has determined the operating segments based on the reports reviewed by the Directors that are used to allocate resources to the segments and assess their performance. The reports reviewed by the Directors are prepared in accordance with the relevant PRC accounting standards, which resulted in the difference in the basis of measurement of segment results, segment assets and segment liabilities, the details of which are shown as reconciling items.

The Directors consider the business from the service and product perspective. Management assesses the performance of the following five operating segments:

Construction of railways, highways, bridges, tunnels, metropolitan railways (including subways and light railways), buildings, irrigation works, hydroelectricity projects, ports, docks, airports and other municipal works ("Infrastructure construction");
Survey, design, consulting, research and development, feasibility study and compliance certification services with respect to infrastructure construction projects ("Survey, design and consulting services");
Design, research and development, manufacture and sale of turnouts, bridge steel structures, and other railway related equipment, engineering machinery and materials ("Engineering equipment and component manufacturing");
Development, sale and management of residential and commercial properties ("Property development"); and
Mining, financial business, operation of service concession arrangements, merchandise trading and other ancillary business ("Other businesses").

Revenue between segments is carried out at actual transaction prices.

The segment information regarding the Group's reportable and operating segments is presented below.

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

								For the year ended 31 December 2020

					Survey,		Engineering
					design and	equipment and
	Infrastructure	consulting		component	Property	Other
			construction	services	manufacturing	development	businesses	Elimination	Total
			RMB million	RMB million		RMB million	RMB million	RMB million	RMB million	RMB million
External revenue	844,110		16,187		23,074		49,304		36,286	-	968,961
Inter-segment revenue	29,553		1,026		6,368		-	35,153	(72,100)	-
Other revenue	2,328		108		351		459		2,525	-	5,771
Inter-segment other revenue	319		-		-	-	219	(538)	-

Segment revenue	876,310		17,321		29,793		49,763		74,183	(72,638)	974,732
Segment results


Profit before income tax	36,876		2,241		2,132		(4,096)	5,016	(8,785)	33,384
Segment results included:


Share of profit/(losses) of
joint ventures	430		5		106		140		(517)	-	164
Share of profit of associates	654		5		48		132		1,192	-	2,031
Interest income	935		70		56		333		2,272	(870)	2,796
Interest expenses	(2,400)	(189)	(69)	(1,612)	(2,852)	654	(6,468)
Loss on derecognition of
financial assets at
amortised cost	(3,172)	(8)	(64)	-	(58)	-	(3,302)

						For the year ended 31 December 2019

			Survey,		Engineering
			design and	equipment and
	Infrastructure	consulting		component	Property	Other
	construction	services	manufacturing	development	businesses	Elimination	Total
	RMB million	RMB million		RMB million	RMB million	RMB million	RMB million	RMB million
External revenue	731,562		16,172		16,974		43,031		37,205	-	844,944
Inter-segment revenue	26,950		502		6,860		181		31,713	(66,206)	-
Other revenue	3,276		357		488		450		1,328	-	5,899
Inter-segment other revenue	296		-		-	-	156	(452)	-

Segment revenue	762,084		17,031		24,322		43,662		70,402	(66,658)	850,843
Segment results


Profit before income tax	20,936		962		1,999		3,652		8,950	(5,166)	31,333
Segment results included:


Share of profit/(losses) of
joint ventures	241		7		70		(21)	63	-	360
Share of profit of associates	944		9		59		36		1,052	-	2,100
Interest income	889		86		58		225		618	(1,014)	862
Interest expenses	(2,214)	(136)	(22)	(2,005)	(3,603)	2,641	(5,339)
Loss on derecognition of
financial assets at
amortised cost	(3,315)	(3)	(54)	-	5	-	(3,367)

A reconciliation of the amounts presented for reportable segments to the consolidated financial statements is as follows:

			2020		2019
			RMB million	RMB million
(i)	Segment interest income, before inter-segment elimination	3,666		1,876
	Inter-segment elimination	(870)	(1,014)

			2,796		862
	Reconciling items:
	Reclassification of interest income obtained from
	other financial assets at amortised cost	1,528		1,338

	Total consolidated finance income, as reported	4,324		2,200


(ii)	Segment interest expenses, before inter-segment elimination	7,122		7,980
	Inter-segment elimination	(654)	(2,641)

			6,468		5,339
	Reconciling item:
	Imputed interest expenses on retention payables	288		235

	Total consolidated finance costs, as reported	6,756		5,574


(iii)	Segment results, before inter-segment elimination	42,169		36,499
	Inter-segment elimination	(8,785)	(5,166)

			33,384		31,333
	Reconciling item:
	Land appreciation tax (Note (a))	2,228		1,854

	Total consolidated profit before income tax, as reported	35,612		33,187

Land appreciation tax is included as charge to segment results under segment reporting and is classified as income tax expense in the consolidated income statement.

100

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China Railway Group Limited published this content on 30 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 March 2021 14:46:04 UTC.

End-of-day quote Shanghai S.E. Other stock markets 06:00:00 2024-04-14 pm EDT			5-day change	1st Jan Change
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11:40am	China Railway Construction’s Controlling Shareholder Boosts Stakeholding	MT
Apr. 10	China Railway Announces Higher Final Dividend for 2023	MT

China Railway Group Limited

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China Railway Construction’s Controlling Shareholder Boosts Stakeholding	05:40am	MT
China Railway Announces Higher Final Dividend for 2023	Apr. 10	MT
China Railway Construction Nixes Merger Plans With China Railway Construction High-tech Equipment	Apr. 08	MT
Shenzhen Investment Hires Contractors for Expressway Reconstruction and Expansion Project	Apr. 03	MT
CRCC High-Tech Equipment's Proposed Integration with Affiliate Scrapped by Parent	Apr. 03	MT
China Railway Group Raises Final Dividend as 2023 Profit Climbs 7%	Apr. 01	MT
CRCC's Profit Slides 2% in 2023; Misses EPS Estimates	Mar. 29	MT
China Railway Group Limited Reports Earnings Results for the Full Year Ended December 31, 2023	Mar. 28	CI
China Railway Group Limited Proposes dividend for the Year of 2023, payable in around August 2024	Mar. 28	CI
Tianyishangjia New Material Bags China Railway Materials' Procurement Bid for 171.5 Million Yuan	Mar. 21	MT
Baota Industry Bags 50.6 Million Yuan China Railway Materials Contract	Mar. 19	MT
China Railway Hi-tech Industry Names Chairman	Feb. 28	MT
Conditions favourable for Vietnam-China cross-border development, says official	Feb. 27	RE
China Railway Construction's 2023 Profit Falls 14%	Feb. 26	MT
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China Railway Signal & Communication Elects President as Chairman	Feb. 21	MT
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CRCC Logs Over 1.5 Trillion Yuan in Q4 2023 Contracts	Jan. 24	MT
Correction: China Railway Signal & Communication Bags Over 3 Billion Yuan of Projects in November-December 2023	Jan. 19	MT
China Railway Signal & Communication Bags Over 3 Billion of Projects in November-December 2023	Jan. 19	MT
China Railway Posts 1.299 Trillion Yuan in New Projects in Q4 2023	Jan. 18	MT

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