Guangshen Railway : • 2019 INTERIM RESULT ANNOUNCEMENT

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.

(a joint stock limited company incorporated in the People's Republic of China)

(Stock Code: 00525)

2019 INTERIM RESULT ANNOUNCEMENT

The Board of Directors of Guangshen Railway Company Limited (the "Company") is pleased to announce the unaudited interim results of the Company and its subsidiaries for the six months ended 30 June 2019. This announcement, containing the full text of the 2019 Interim Report of the Company, complies with the relevant requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited in relation to information to accompany preliminary announcement of interim results. Printed version of the Company's 2019 Interim Report will be available on the websites of the HKExnews of The Stock Exchange of Hong Kong Limited at www.hkexnews.hk and of the Company at www.gsrc.com on 22 August 2019 and will be despatched to holders of H shares of the Company as soon as practicable.

Important Notice

1. The Board, the Supervisory Committee, Directors, Supervisors and senior management of the Company warrant that the contents of this interim report are authentic, accurate and complete, and there are no misrepresentations, misleading statements or material omissions in this interim report, and severally and jointly accept the related legal responsibility.
2. All Directors of the Company attended the meeting of the Board considering this interim report.
3. The financial statements contained in this interim report have been prepared in accordance with the International Financial Reporting Standards and have not been audited.
4. Wu Yong, Chairman of the Board of the Company, Hu Lingling, Managing Director, Tang Xiangdong, Chief Accountant, and Lin Wensheng, Chief of Finance Department hereby warrant the authenticity, accuracy and completeness of the financial statements contained in this interim report.
5. The Board of the Company decided not to distribute any profit or transfer any common reserve to increase share capital during the reporting period.
6. Declaration of Risks with Respect to theForward-looking Statements
   Forward-looking statements including future plans and development strategies contained in this interim report do not constitute any actual commitments to the investors of the Company. Investors are advised to consider the risks.
7. Is there anynon-regular appropriation of fund by the controlling shareholders and their related parties
   No
8. Is there any violation of thedecision-making procedures with respect to the provision of external guarantee
   No
9. Notice of Material Risks
   This interim report contains details of potential risks in the future. Please read "Potential risks" in the chapter "Report of Directors (Including Management's Discussion and Analysis)".

Contents

Chapter 1	Definitions	6
Chapter 2	Company Profile and Major Financial	7
	Indicators
Chapter 3	Summary of the Company's Business	10
Chapter 4	Report of Directors (Including	11
	Management's Discussion and
	Analysis)
Chapter 5	Matters of Importance	22
Chapter 6	Changes in Ordinary Share	37
	and Particulars of Shareholders
Chapter 7	Information of Preference Shares	41
Chapter 8	Directors, Supervisors, Senior	42
	Management and Employees
Chapter 9	Information of Corporate Bonds	44
Chapter 10	Financial Statements	45
Chapter 11	Documents Available for Inspection	76

Chapter 1

Definitions

In this report, unless the context otherwise requires, the expressions stated below have the following meanings:

the Company, Guangshen	Guangshen Railway Company Limited
Railway
reporting period, current period	6 months from January 1 to June 30, 2019
same period last year	6 months from January 1 to June 30, 2018
A Share	Renminbi-denominated ordinary shares of the Company with a par value
	of RMB1.00 issued in the PRC and listed on the SSE for subscription in
	Renminbi
H Share	Overseas listed foreign shares of the Company with a par value of RMB1.00
	issued in Hong Kong and listed on the SEHK for subscription in Hong Kong
	dollars
ADS	U.S. dollar-denominated American Depositary Shares representing
	ownership of 50 H shares issued by depository bank (Trustee) in the United
	States under the authorization of the Company
CSRC	The China Securities Regulatory Commission
SSE	The Shanghai Stock Exchange
SEHK	The Stock Exchange of Hong Kong Limited
NYSE	The New York Stock Exchange
SFO	The Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong)
Listing Rules	The Rules Governing the Listing of Securities on SEHK and/or the Rules
	Governing the Listing of Stocks on SSE (as the case may be)
Articles	The articles of association of Guangshen Railway Company Limited
CSRG (Note)	China State Railway Group Co Ltd
CRC (Note)	China Railway Corporation
GRGC, largest shareholder	China Railway Guangzhou Group Co., Ltd.
GZIR	Guangdong Guangzhou Intercity Rail Transportation Company Limited
WGPR	Wuhan-Guangzhou Passenger Railway Line Co., Ltd.
GSHER	Guangzhou-Shenzhen-Hong Kong Express Rail Link Company Limited
GZR	Guangzhou-Zhuhai Railway Company Limited
XSR	Xiamen-Shenzhen Railway Company Limited
GSR	Ganzhou-Shaoguan Railway Company Limited
GGR	Guiyang-Guangzhou Railway Company Limited
NGR	Nanning-Guangzhou Railway Company Limited
PRDIR	Guangdong Pearl River Delta Inter-city Railway Traffic Company Limited
MZR	MaoZhan Railway Company Limited

Note:On 18 June 2019, with the approval of the State Council, China Railway Corporation was restructured and established China State Railway Group Co Ltd ("CSRG").

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Chapter 2

Company Profile and Major Financial Indicators

I. Company Information

Chinese name of the Company	廣深鐵路股份有限公司
Chinese name abbreviation of the Company	廣深鐵路
English name of the Company	Guangshen Railway Company Limited
Legal representative of the Company	Wu Yong
Place of incorporation	Incorporated in the People's Republic of China as a
	joint stock limited company

II. Contact Person and Contact Information

	Secretary to the Board	Representative of Securities Affairs
Name	Guo Xiangdong	Deng Yanxia
Contact Address No. 1052 Heping Road, Luohu District,	No. 1052 Heping Road, Luohu District,
Shenzhen, Guangdong Province	Shenzhen, Guangdong Province
Tel.	(86) 755-25588150	(86) 755-25588150
Fax.	(86) 755-25591480	(86) 755-25591480
E-mail	[e-mail]	[e-mail]
III. Changes in Basic Information
Company's Registered Address	No. 1052 Heping Road, Luohu District,
		Shenzhen, Guangdong Province
Postal Code of Company's		518010
Registered Address
Company's Place of Business	No. 1052 Heping Road, Luohu District,
		Shenzhen, Guangdong Province
Postal Code of the Company's Place	518010
of Business
Company Website		http://www.gsrc.com
E-mail		[e-mail]

IV. C h a n g e s i n I n f o r m a t i o n D i s c l o s u r e a n d R e s e r v e Address

Newspapers specified by the Company	China Securities Journal, Securities Times,
for information disclosure	Shanghai Securities News, Securities Daily
Websites specified by CSRC to publish	http://www.sse.com.cn
the interim report	http://www.hkexnews.hk
	http://www.gsrc.com
Reserve address of the Company's interim No. 1052 Heping Road, Luohu District,
report	Shenzhen, Guangdong Province

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Company Profile and Major Financial Indicators

V. SHARES INFORMATION OF THE COMPANY

Type of the Shares	Stock Exchange	Stock Short Name	Stock Code
	of listed shares	廣深鐵路
A Share	SSE	601333
H Share	SEHK	GUANGSHEN RAIL	00525
ADS	NYSE	-	GSH

VI. OTHER RELEVANT INFORMATION

The Company's	Name	PricewaterhouseCoopers Zhong Tian LLP
accounting firm
(domestic)	Office Address	11/F, PricewaterhouseCoopers Center, Link Square 2,
		202 Hu Bin Road, Huangpu District, Shanghai, China
	Name of signing	Yao Wenping, Liu Jingping
The Company's	auditors
Name	PricewaterhouseCoopers
accounting firm
(overseas)	Office Address	22nd Floor, Prince's Building, Central, Hong Kong
Legal advisor as to	Name	Beijing Grandway Law Office
PRC law	Office Address	12/F, Block C, Skyworth Building, 8 South One Street, Hi-Tech Zone,
		Nanshan District, Shenzhen
Legal advisor as to	Name	Cleary Gottlieb Steen & Hamilton (Hong Kong)
Hong Kong law	Office Address	37th Floor, Hysan Place, 500 Hennessy Road, Hong Kong
Legal advisor as to	Name	Jones Day
United States law	Office Address	31st Floor, Edinburgh Tower, The Landmark,
		15 Queen's Road Central, Central, Hong Kong
Registrar for A Share	Name	China Securities Depository and Clearing Corporation Limited
		Shanghai Branch
	Office Address	36th Floor, China Insurance Building, No. 166 Lujiazui East Road,
		Pudong New District, Shanghai
Registrar for H Share	Name	Computershare Hong Kong Investor Services Limited
	Office Address	Rooms 1712-1716, 17th Floor, Hopewell Centre,
		183 Queen's Road East, Wan Chai, Hong Kong
Depository	Name	JPMorgan Chase Bank, N.A.
	Office Address	13th Floor, No. 4 New York Plaza, New York, USA
Principal banker	Name	Construction Bank of China Shenzhen Branch Jiabin Road Sub-branch
	Office Address	1st to 4th Floors, Jinwei Building, Jiabin Road, Shenzhen, China

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VII. Major Accounting Data and Financial Indicators of the Company

(Unit: RMB thousand)

			Increase/
			decrease
			for the end
			of reporting
			period
			compared
	At the end of		to the end
	the reporting	At the end	of last year
	period	of last year	(%)
Total assets	36,341,750	35,402,237	2.65
Net assets (excluding interests
of minor shareholder)	29,189,447	28,852,299	1.17
Net assets per share (RMB/Share)	4.12	4.07	1.23
			Increase/
			decrease
			for the
			reporting
			period
			compared
	Reporting		with the
	period		same period
	(From January	Same period	last year
	to June)	last year	(%)
Total revenue	10,186,929	9,527,773	6.92
Total operating expenses	9,153,922	8,654,884	5.77
Profit from operations	1,057,792	866,676	22.05
Profit before tax	1,016,837	873,167	16.45
Consolidated profit attributable to shareholders	762,160	654,085	16.52
Basic earnings per share (RMB/Share)	0.11	0.09	22.22
Earnings per ADS (RMB/Unit)	5.38	4.62	16.45
Net cash inflows from operating activities	1,365,426	1,455,294	(6.18)
Net cash inflows from operating activities
per share (RMB/Share)	0.19	0.21	(9.52)

VIII. Difference of Accounting Data Under Chinese and International Accounting Standards

• Applicable 3Not Applicable
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Chapter 3

Summary of the Company's Business

I. PRINCIPAL ACTIVITIES, BUSINESS MODEL AND INDUSTRY FACT SHEET DURING THE REPORTING PERIOD

1. Principal Activities and Business Model
   During the reporting period, as a railway transport enterprise, the Company is mainly engaged in railway passenger and freight transportation businesses in the Shenzhen-Guangzhou-Pingshi Railway and the Hong Kong Through Train passenger services in cooperation with MTR Corporation Limited, as well as the provision of railway operation services for commissioned transportation for other railway companies such as WGPR, GZIR, GSHER, GZR, XSR, GSR, NGR, GGR, PRDIR and MZR.
2. Industry Fact Sheet
   Being the aorta of the nation's economy, a key infrastructure, significant project for people's livelihood, the backbone of integrated transportation system and one of the main methods of transportation, railway is of crucial importance for nation's economic and social development. Since the approval for implementation of Medium to Long Term Plan for Railway Network Development by the State Council in 2004, the railways developed rapidly. With the completion and commencement of a series of high-speed railways and inter-city railways in recent years, currently on the whole, the tight capacity of railway in China has been alleviated, the bottle-neck restriction has been eliminated and the economic and social development needs have been met in general. By the end of 2018, nationwide railways in operation reached 131,000 kilometers; while the high-speed railways in operation ran over 29,000 kilometers.

1. . EXPLANATION OF THE SIGNIFICANT CHANGE IN THE MAJOR ASSETS OF THE COMPANY DURING THE REPORTING PERIOD

For the explanation of the significant change in the major assets of the Company during the reporting period, please read "Analysis of assets and liabilities" in the chapter "Report of Directors (Including Management's Discussion and Analysis)" in this interim report.

III. A N A L Y S I S O F C o r e C O M P E T I T I V E E D G E S D U R I N G T H E REPORTING PERIOD

During the reporting period, no significant changes were made for the Company's core competitive edges.

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Chapter 4

Report of Directors

(Including Management's Discussion and Analysis)

I. Discussion and Analysis on the Operation of the Company During the Reporting Period

In the first half of 2019, the operating revenues of the Company were RMB10,187 million, representing an increase of 6.92% from RMB9,528 million of the same period last year, among which revenues from passenger transportation, freight transportation, railway network usage and other transportation services, and other businesses were RMB4,076 million, RMB918 million, RMB4,740 million and RMB453 million respectively, accounting for 40.01%, 9.01%, 46.53% and 4.45% of the total revenues respectively. Profit from operations was RMB1,058 million, representing an increase of 22.05% from RMB867 million of the same period last year; consolidated profit attributable to shareholders was RMB762 million, representing an increase of 16.52% from RMB654 million of the same period last year.

1. Analysis of principal operations

1. Analysis of changes in items of financial statements

		(Unit: RMB thousand)
		Same period
Item	Current period	last year	Change (%)
Operating revenues	10,186,929	9,527,773	6.92
Operating expenses	9,153,922	8,654,884	5.77
Income tax expenses	256,749	221,582	15.87
Net cash flows from operating activities	1,365,426	1,455,294	(6.18)
Net cash flows from investing activities	(1,183,111)	(682,647)	73.31
Net cash flows from financing activities	-	-	-

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2. Revenue

1. Passenger Transportation

Passenger transportation, which is the most important transportation business segment of the Company, includes transportation business of Guangzhou-Shenzheninter-city express trains (including East Guangzhou- Chaoshan cross-network EMUs), long-distance trains and Hong Kong Through Trains. As of June 30, 2019, the Company operated 248.5 pairs of passenger trains each day, including 109 pairs of intercity high- speed passenger trains between Guangzhou and Shenzhen (including 99 pairs of inter-city trains between Guangzhou East to Shenzhen, and 10 pairs of Guangzhou East to the Chaozhou-Shantoucross-network EMU trains), 13 pairs of Hong Kong Through Trains (11 pairs of Canton-Kowloon Through Trains, 1 pair of Foshan-Kowloon Through Train, and 1 pair of Beijing/Shanghai-Kowloon Through Train), and 126.5 pairs of long-distance trains (including 10.5 pairs of Guangzhou-Foshan-Zhaoqing intercity trains, and 7 pairs of Guangzhou East to Guilin North, Nanning East, Guiyang North, Chengdu East and Xiamen ross-network EMU trains). The table below sets forth the revenues from passenger transportation and passenger delivery volumes for the current period in comparison with those in the same period last year:

			Period-on-
	January -	January -	period
	June 2019	June 2018	Change (%)
Passenger transportation revenues
(RMB ten thousand)	407,609	401,232	1.59
- Guangzhou-Shenzheninter-city trains	153,195	137,241	11.62
- Through Trains (*)	16,984	26,371	(35.60)
- Long-distance trains	208,702	212,498	(1.79)
- Other revenues from passenger transportation	28,728	25,122	14.35
Passenger delivery volume (persons)	43,733,669	43,609,411	0.28
- Guangzhou-Shenzheninter-city trains	20,413,856	19,052,405	7.15
- Through Trains (*)	1,208,070	1,980,032	(38.99)
- Long-distance trains	22,111,743	22,576,974	(2.06)
Total passenger-kilometers
('00 million passenger-kilometers)	125.55	129.55	(3.09)

• The increase in passenger transportation revenues and passenger delivery volume was mainly due to:Despite the commencement of the Hong Kong section ofGuangzhou-Shenzhen-HongKong Express Rail Link and the diversion effect from the optimizing ofhigh-speedrailway network, coupled with the decreased passenger delivery volume and passenger transportation revenues of the through trains andlong-distancetrains operated by the Company, both the passenger delivery volume and passenger transportation revenues ofGuangzhou-Shenzheninter-citytrains recorded considerable increase as driven by the increase in its capacity. Therefore, the overall revenues from passenger transportation and passenger delivery volume still achieved a growth during the reporting period.

• Since July 10, 2019, due to the adjustment of the national railway train schedule, the number ofCanton-Kowloon Through Trains was adjusted from 11 pairs to 8 pairs. Meanwhile, the departure and terminal station of Foshan-Kowloon Through Train was changed from Foshan Station to Guangzhou East Station.

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(2) Freight Transportation

Freight transportation forms an important part of the Company's transportation business. The table below displays the current period revenues from freight transportation and outbound freight volume as compared with the same period last year:

			Period-on-
	January -	January -	period
	June 2019	June 2018	Change (%)
Freight transportation revenues
(RMB ten thousands)	91,758	86,535	6.04
- Revenues from freight charges	80,406	75,162	6.98
- Other revenues from freight transportation	11,352	11,373	(0.18)
Outbound freight volume (tonnes)	7,818,161	7,659,949	2.07
Full-distance volume of outbound freight traffic
('00 million tonne-kilometers)	70.30	63.61	10.52

• The increase in freight transportation revenues and outbound freight volume was mainly due to:with the stablemacro-economicdevelopment, implementation of national campaign of improving rail freight transportation capacity, and the increase in outbound freight tonnage carried by the Company, freight transportation revenues increased.

(3) Railway Network Usage and Other Transportation Services

Railway network usage and other transportation services provided by the Company mainly include passenger and freight transportation railway network usage, provision of railway operation services, locomotive and passenger car leasing, passenger service and luggage transportation. The table below sets forth the revenues from railway network usage and other transportation services for the current period in comparison with those of the same period last year:

			Period-on-
	January -	January -	period
	June 2019	June 2018	Change (%)
Revenues from railway network usage and other
transportation services (RMB ten thousands)	474,047	424,531	11.66
(a) Railway network usage services	205,302	191,446	7.24
(b) Other transportation services	268,745	233,085	15.30
- Railway operation	175,346	158,372	10.72
- Other services	93,399	74,713	25.01

• The increase in the revenues from railway network usage services was mainly due to:with the stablemacro-economicdevelopment, implementation of national campaign of improving rail freight transportation capacity, and the increase in goods delivered through railway transportation, the revenues from railway network usage of freight transportation increased.

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• The increase in revenues from other transportation services was mainly due to:The increase in workload for railway operations and passenger services provided by the Company during the reporting period drove the growth of related revenues.

(4) Other Businesses

The Company's other businesses mainly include train repairment, on-board catering services, leasing, sales of materials and supplies, sales of goods and other businesses related to railway transportation. During the first half of 2019, revenues from other businesses were RMB453 million, representing an increase of 11.86% as compared with RMB405 million during the same period last year, mainly due to the increase in revenues from the freight carriage maintenance and usage.

3. Costs

			(Unit: RMB thousand)
			Period-on-
	January -	January -	period
Business Segment	June 2019	June 2018	Change (%)
Railway business	8,710,701	8,230,241	5.84
Other businesses	443,221	424,643	4.37
Total	9,153,922	8,654,884	5.77

• The increase in the costs of railway business was mainly due to:(1) with the increase inindustry-widepay level, expenses in wages and welfare increase; (2) with the stablemacro-economicdevelopment, implementation of national campaign of improving rail freight transportation capacity, and the increase in goods delivered through railway transportation, the expenses for railway network usage of freight transportation increased; (3) with the increase in workload for railway operations and passenger services provided, consumption of materials and utilities, maintenance expenses for railway and equipment, as well as passenger service costs increased.

4. Expenses

				(Unit: RMB thousand)
			Period-on-
	January -	January -	period
Item	June 2019	June 2018	Change (%)	Major reason for the changes
Income tax	256,749	221,582	15.87	The increase in the total profit
expenses				before tax.

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5. Cash Flow

				(Unit: RMB thousand)
	January -	January -	Period-on-
	period	Major reason for the changes
	June 2019	June 2018	Change (%)
Net cash flows	1,365,426	1,455,294	(6.18)	-
from operating
activities
Net cash flows	(1,183,111)	(682,647)	73.31	Decrease in the compensation
from investing				received in advance in relation
activities				to the resumption of Land use
				rights and increase in investment
Net cash flows	-	-	-	expenses of fixed assets.
-
from financing
activities

(2) Analysis of assets and liabilities

			(Unit: RMB thousand)
			Changes in
			amount from
		Amount at	the end of
	Amount at	previous period
	the end of	to the end of
Item	the end of	previous	current period
current period	period	(%)
Right-of-use assets	3,069,080	-	100.00
Prepayments and other receivables	226,436	348,907	(35.10)
Lease liabilities	1,118,351	-	100.00
Payables for fixed assets and construction-in-	1,441,845	2,441,647	(40.95)
progress
Dividend payables	437,900	12,894	3,296.15

1. The increase inright-of-use assets and lease liabilities was mainly due to: the Company recognized the lease liabilities and right-of-use assets based on the carrying amount of the outstanding lease payment under land operating commitment as a result of the implementation of the new lease standard;
2. The decrease in prepayments and other receivables was mainly due to the decrease in the prepayments for construction works;
3. The decrease in payables for fixed assets andconstruction-in-progress was mainly due to the decrease in payables for construction works and equipments;
4. The increase in dividend payables was mainly due to the declared final cash dividend of 2018 has not been paid.

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Report of Directors

(Including Management's Discussion and Analysis)

1. Analysis on investment positions

1. General analysis on investments in external equity interests

During the reporting period, the Company did not invest in securities such as stocks, warrants or convertible bonds, and did not hold or deal in equity interests of other listed companies and non-listed financial enterprises.

(i) Significant investments in equity interests

• Applicable 3Not Applicable

1. Significantnon-equity investments

(Unit: RMB ten thousand)

			Invested	Actual
			amount	amount
	Project	Progress of	during the	invested in
Project name	amount	project	Year	aggregate
Purchases of CRH6A EMU trains
(6 pairs)	77,328	100%	54,130	77,328
Reconstruction of automatic
inter-locking equipment from
Guangzhou to Pingshi section	72,651	56%	3,776	40,948
Improvements of system adaptability
of the traction power supply system
from Pingshi to Guangzhou section of
the Beijing-Guangzhou railway	58,499	65%	3,970	37,860
Section repair, capacity expansion and
renovation project of the Guangzhou
North vehicle section	37,600	62%	6,639	23,301
Reconstruction of the section from
Guangzhou East to Xintang of
Guangshen line III and IV	36,383	76%	810	27,656
Phase I construction of the newly
built staff apartment in Shipai of
Guangzhou area	35,000	48%	266	16,902

(iii) Financial assets at fair value

At the end of the reporting period, the Company held a financial asset with a carrying amount of RMB351,045,000 measured at fair value and changes in fair value recorded under other comprehensive income. During the reporting period, there was no change in the fair value of these assets.

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(4) Disposal of major assets and equity interests

• Applicable 3Not Applicable

(5) Analysis of major shareholding company

During the reporting period, the Company did not have net profit from a single subsidiary or investment income from a single investee company with an amount exceeding 10% of the Company's net profit.

1. . OPERATING OUTLOOK AND FOCUS TASKS FOR THE SECOND HALF OF 2019

Looking forward to the second half of 2019, China's economy is expected to maintain the momentum of progress with stability as a whole and perform within a reasonable range. Meanwhile, the market demand of national railway passenger and freight transportation will continue to maintain its rapid acceleration. Facing the abovementioned business circumstances, the Company will adhere to the direction expressed from Xi Jingping Great Thought on Socialism with Chinese Characteristics for a New Era, will closely focus on the annual business objectives confirmed by the Board, so as to combine the thematic education of "remaining true to our original aspiration and keeping our mission firmly in mind", build up China's strength in transportation with railway as the priority, to strengthen the foundation, pursue achievements, improve quality and efficiency, deepen the implementation of improving freight transportation capacity, improve the quality and efficiency of its passenger transportation service, deepen the supply-side structural reform of the transportation industry continually, scale up the core business of railway transportation, reinforce its cost and expense control, regulate the Company's operation management, ensure the ongoing secure and stable operation of railway transportation, and focus on the following tasks:

1. Passenger transportation: Firstly, timely adjust transportation coordination and improve the train operation schedules during summer peak season,Mid-Autumn Festival, National Day, and Canton Fair to realise growth in transportation volume and revenue. On 10 July 2019, the Company organized and added the cross-network EMUs, including Shenzhen to Huaiji (1 pair), and Guangzhou East to Chaozhou-Shantou (2 pairs); secondly, in an effort to captilise the opportunities from the expected launch of Guangzhou-Dongguan-Shenzhen Intercity Railway in the second half of the year, perform passenger traffic volume analysis and develop corresponding plans to actively address the impact on the passenger traffic volume of Guangzhou-Shenzheninter-city trains; thirdly, further improve the service environment for passenger transportation to enhance passenger service experience, as well as to improve the quality and efficiency of passenger transportation service.

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1. Freight transportation: Firstly, continue to implement thesupply-side structural reform of railway services, strengthen strategic cooperation with large enterprises and expand bulk goods freight transportation volume; secondly, develop new trips of "white freight", strengthen the existing sources and supply organizations, improve the efficiency of "white freight"; thirdly, promote the construction of freight infrastructure to improve cargo storage and turnover capacity.
2. Operational management: Firstly, strengthen the awareness of operating efficiency, improve budget management, strictly control the cost and expenditure; secondly, strengthen the budget management and centralised capital management, ensure the safety of capital, reduce the capital costs and improve the efficiency and return of the use of capital.

III. Other Disclosure

1. Warning and description of forecast of cumulative net profit (for the period from the beginning of the year to the end of the next reporting period) to be at loss or with significant change as compared with the same period last year

• Applicable 3Not Applicable

(2) Potential risks

Type of risk	Description of risk		Addressing measures
Macro-economic risk	Railway transportation industry is	The Company will pay close attention
	highly related to macro-economic	to the changes in international and
	development conditions and may be	domestic macro-economic conditions,
	greatly affected by macro-economic	to	strengthen	analysis and study
	environment. If the macro-economic	o n	f a c t o r s a f f e c t i n g	r a i l w a y
	e n v i r o n m e n t d e t e r i o r a t e s ,	t h e	transportation	industry	and be
	Company's operation results	and	committed to achieve stability in the
	financial condition may be adversely	Company's production and operation
	affected.		b y	a d j u s t i n g	t h e C o m p a n y ' s
			development strategy in response to
			market change timely.

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Type of risk	Description of risk
Policy and regulatory risk	Railway transportation industry
	m a y b e g r e a t l y a f f e c t e d b y
	government policies and regulations.
	With changes in domestic and
	international economic environment
	and reform and development of
	railway transportation industry,
	corresponding adjustment may
	b e r e q u i r e d f o r r e l a t i v e l a w s
	and regulations and industrial
	policies. These changes may incur
	uncertainties to the Company's
	business development and operation
	results in the future.

Addressing measures

T h e C o m p a n y w i l l p r o a c t i v e l y engage in different seminars for improvement of industrial polices a n d r e g u l a t i o n s d e v e l o p m e n t , study the latest changes in policies a n d r e g u l a t i o n s , c a p t u r e t h e development opportunities brought by amendments in policies and regulations and adopt a prudent approach in addressing uncertainties caused by the changes in policies and regulations.

Transportation safety risk	T r a n s p o r t a t i o n s a f e t y i s t h e
	p r e r e q u i s i t e a n d f o u n d a t i o n
	for normal operation and good
	reputation of	railway transportation
	industry. Bad	weather, mechanical
	failures, human error and other force
	majeure may impose adverse impact

on the transportation safety of the Company.

The Company proactively participates in transportation safety meetings held by authorities of the industry to understand the transportation safety conditions of the Company, deploy resources in transportation safety management, establish and optimize safety risk management and control and intensify the training of safety knowledge and capability of transportation personnel.

019    Interim report

Chapter 4

Report of Directors

(Including Management's Discussion and Analysis)

Type of risk	Description of risk
Market competition risk	C o m p e t i t i o n	e x i s t s	i n	c e r t a i n
	markets between aviation,	road
	a n d w a t e r t r a n s p o r t a t i o n a n d
	railway transportation. In	addition,
	with the development in railway
	transportation	industry,	a	range
	of high-speed	railways and	inter-
	c i t y r a i l w a y s h a s c o m m e n c e d
	operation . Internal	competition

within railway transportation industry also intensifies. The Company may be subject to greater competitive pressure in the future, which in turn constitutes impact on the operation results of the Company.

Addressing measures

The Company will take proactive a c t i o n s i n a d d r e s s i n g m a r k e t

competition	by leveraging the
advantages of	"safe,	comfortable,
convenient,	timely"	of	railway
transportation, improving	service
facilities and	enhancing	service

q u a l i t y . I n r e s p e c t o f f r e i g h t transportation, the Company will spare great efforts to increase the efficiency, turnover rate and trip frequency of freight trains. In addition, the Company will strengthen the analysis and research on railway transportation market, and proactively apply to authorities of the industry for adding new long- distance trains in areas not covered by high-speed railways.

Financial risk	The operating activities of the
	Company are subject to various
	financial risks, such as exchange
	rate risk, interest risk, credit risk and
	liquidity risk.

The Company has established a set of managerial procedures to deal with financial risks with focus on the uncertainties of financial market, which are designated to minimize the potential adverse impact on the financial performance of the Company. For more detailed analysis, please refer to "Note 4 to the financial statements".

020    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

1. Other disclosures

1. Liquidity and source of funding

During the reporting period, the principal capital sources of the Company were revenues generated from operating activities. The Company's capital was mainly used for operating and capital expenses, and payment of taxes, etc. The Company has sufficient cash flow and believes that it has sufficient working capital, bank facilities and other capital sources to meet its operation and development needs.

As at the end of the reporting period, the Company had no borrowings of any form. Capital commitments and operating commitments of the Company as at the end of the reporting period are set out in Note 14 to the financial statements.

As at the end of the reporting period, the Company had no charge on any of its assets and had not provided any guarantees, and had no entrusted deposits, and the gearing ratio (calculated by total liabilities divided by total assets as at the end of the period) of the Company was 19.79%.

2. Material investments held, material acquisitions and disposals of subsidiaries and associates, and future plans of material investments or acquisitions of capital assets

During the reporting period, the Company had no material investment, had not carried out any material acquisition or disposal of subsidiaries and associates, and had no definite plan for material investment or acquisition of capital assets.

3. Risk of foreign exchange rate fluctuations and related hedges

The Company's exposure to foreign currency risks is mainly related to USD and HKD. Apart from payments for imported purchases and dividend paid to foreign investors, which are settled in foreign currencies, other major operational businesses of the Company are all settled in RMB. RMB is not freely convertible into other foreign currencies, and its conversion is subject to the exchange rates and regulations of foreign exchange control promulgated by the PRC government. Any foreign currency denominated monetary assets and liabilities other than denominated in RMB are subject to the risks of foreign exchange rate fluctuations.

The Company has not used any financial instruments to hedge its foreign currency risks. Currently, its foreign currency risks are minimized mainly through monitoring the size of transactions in foreign currencies and foreign currency denominated assets and liabilities.

4. Contingent liabilities

During the reporting period, the Company had no contingent liability.

021    Interim report

Chapter 5

Matters of Importance

I. SUMMARY OF GENERAL MEETINGS

Session of meeting	Date	Media in which resolutions were disclosed	Date of disclosure
Annual General Meeting of 2018	June 13, 2019 Website of SSE (www.sse.com.cn)	June 14, 2019
		HKExnews Website of SEHK (www.hkexnews.hk)	June 13, 2019

1. . PLANS FOR PROFIT DISTRIBUTION OR COMMON RESERVE CAPITALIZATION

Distribution or Capitalization                No

III. FULFILLMENT OF COMMITMENTS

Commitment	Commitment			Date and term	Execution	Strict
background	type	Parties	Contents of the Commitment	of commitment	time limit	Compliance
Commitment	Resolve industry	GRGC	GRGC and any of its subsidiaries will not engage, directly or	-	No	Yes
related to	competition		indirectly, by any means, in any business activities that may
IPO			compete with the railway transportation and related businesses of
			the Company within the service territory of the Company. After the
			acquisition of the transportation operational assets and businesses of
			Guangzhou-Pingshi Railway, GRGC and any of its subsidiaries will not
			compete with the Company either.	-	No	Yes
	Resolve	GRGC	GRGC will reduce the number of connected transactions as much
	connected		as practicable in its operation relations with the Company. For
	transactions		necessary connected transactions, GRGC will perform these
			connected transactions on the basis of openness, justice and fairness
			without abusing its position as the largest shareholder and behaving
			in a manner that is detrimental to the interests of the Company.	20 years	Yes	Yes
Other	Other	GRGC	GRGC leased the occupied land in the Guangzhou-Pingshi section to
commitments			the Company after the acquiring of such land by means of authorized
			operation. The leasing agreement entered into by the Company and
			GRGC became effective on January 1, 2007, pursuant to which, the
			land use right for the Guangzhou-Pingshi Railway line was leased to
			the Company by GRCG for a leasing term of 20 years. It has been
			agreed by the two parties that the annual land rent should not
			exceed RMB74 million.
	Other	GRGC	GRGC has issued a letter of commitment to our Company in October	October 2007	No	Yes
			2007, in relation to the enhancement of the management of
			undisclosed information.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

IV. ENGAGEMENT AND DISMISSAL OF ACCOUNTING FIRMS

On 13 June 2019, the Company held the 2018 Annual General Meeting and resolved to re-appoint PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers as the auditors of the Company in 2019.

V. B A N K R U P T C Y , R E S T R U C T U R I N G A N D I N C I D E N T S O F SUSPENSION OF LISTING OR TERMINATION OF LISTING

• Applicable 3Not Applicable

VI. MAJOR LITIGATION AND ARBITRATION

• The Company had material litigation and arbitration during the reporting period

• The Company did not have material litigation and arbitration during the reporting period

VII. PUNISHMENT ON THE Listed COMPANY, ITS DIRECTORS, S U P E R V I S O R S , S E N I O R M A N A G E M E N T , C O N T R O L L I N G S H A R E H O L D E R S , d e f a c t o c o n t r o l l e r , S H A R E H O L D E R S HOLDING MORE THAN 5% OF THE SHARES, PURCHASER AND THE RECTIFICATION THEREOF

• Applicable 3Not Applicable

VIII . E X P L A N A T I O N O N I N T E G R I T Y O F T H E C O M P A N Y , I T S C O N T R O L L I N G S H A R E H O L D E R S A N D D E F A C T O C O N T R O L L E R DURING THE REPORTING PERIOD

• Applicable 3Not Applicable

IX. THE COMPANY'S SHARE INCENTIVE SCHEME, EMPLOYEE STOCK OWNERSHIP PLAN, OR OTHER EMPLOYEES' INCENTIVE MEASURES AND THEIR IMPACTs

• Applicable 3Not Applicable

X. TRANSACTIONS OF ASSETS AND MERGERS OF ENTERPRISE

• Applicable 3Not Applicable
  023    Interim report

Chapter 5

Matters of Importance

XI. MATERIAL CONNECTED TRANSACTIONS

(1) Connected transactions related to daily operations

During the reporting period, the related party transactions in relation to daily operations are set out in Notes 15 and 16 to the financial statements. The Company confirmed that the following transactions are connected transactions (including continuing connected transactions) described under Chapter 14A of the Listing Rules of the SEHK, and at the same time constitute related party transactions described under the Notes 15 and 16 to the financial statements. With regard to the following transactions, the Company has complied with the rules and requirements of Chapter 14A of the Listing Rules of the SEHK.

1. Transactions conducted with GRGC and its subsidiaries

(Unit: RMB thousand)

Party	Connected	Type of	Description of	Basis of pricing for	Amount of
relationship	transaction	transaction	the transaction	transaction
GRGC and its	Largest	Provision of service	Train service	By consultation according to	997,271
subsidiaries	shareholder and			full cost pricing or settle
	its subsidiaries			according to price determined
GRGC and its	Largest	Provision of service	Railway network settlement service	by CSRG	762,715
Settle according to price
subsidiaries	shareholder and		through CSRG	determined by CSRG
Subsidiary of	its subsidiaries	Provision of service	Railway operation service	Based on agreement according	403,400
Subsidiary of
GRGC	the largest			to cost plus pricing
GRGC and its	shareholder	Sales of goods	Sales of materials and supplies	By consultation according to full	18,094
Largest
subsidiaries	shareholder and			cost pricing
GRGC and its	its subsidiaries	Service received	Train service	By consultation according to	609,625
Largest
subsidiaries	shareholder and			full cost pricing or settle
	its subsidiaries			according to price determined
GRGC and its	Largest	Service received	Railway network settlement service	by CSRG	1,060,125
Settle according to price
subsidiaries	shareholder and		through CSRG	determined by CSRG
GRGC	its subsidiaries	Lease of land	Land leasing service	Based on agreement	29,810
Largest
GRGC and its	shareholder	Service received	Repair and maintenance service	By consultation according to full	145,438
Largest
subsidiaries	shareholder and			cost pricing
GRGC and its	its subsidiaries	Purchase of goods	Purchase of materials and supplies	Based on agreement which	169,329
Largest
subsidiaries	shareholder and			determines price according to
	its subsidiaries			purchase amount plus 0.3%-
GRGC and its	Largest	Service received	Construction works service	5% management fee	20,742
Based on fixed amount approved
subsidiaries	shareholder and			by national railway works
	its subsidiaries

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

2. Transactions conducted with CSRG and other railway enterprises

(Unit: RMB thousand)

Party	Connected	Type of	Description of transaction	Basis of pricing for	Amount of
relationship	transaction	the transaction	transaction
CSRG and other	De facto controller	Provision of	Train service	By consultation according to full cost	9,756
railway	of the largest	service		pricing, or settle according to the prices
enterprises	shareholder and			determined by CSRG
	its subsidiaries	Provision of	Railway network settlement	Settle according to the prices determined	1,304,960
CSRG and other	De facto controller
railway	of the largest	service	service through CSRG	by CSRG
enterprises	shareholder and
	its subsidiaries	Provision of	Railway operation service	Based on agreement according to cost plus	1,087,152
CSRG and other	De facto controller
railway	of the largest	service		pricing
enterprises	shareholder and
	its subsidiaries	Provision of	Truck maintenance service	Settle according to the prices determined	169,516
CSRG and other	De facto controller
railway	of the largest	service		by CSRG
enterprises	shareholder and
	its subsidiaries	Sales of goods	Sales of materials and supplies	By consultation according to full cost	2,837
CSRG and other	De facto controller
railway	of the largest			pricing
enterprises	shareholder and
	its subsidiaries	Provision of	Apartment leasing service	By consultation according to full cost	259
CSRG and other	De facto controller
railway	of the largest	service		pricing
enterprises	shareholder and
	its subsidiaries	Service received Train service	By consultation according to full cost	146,812
CSRG and other	De facto controller
railway	of the largest			pricing, or settle according to the prices
enterprises	shareholder and			determined by CSRG
	its subsidiaries	Service received Railway network settlement	Settle according to the prices determined	1,103,693
CSRG and other	De facto controller
railway	of the largest		service through CSRG	by CSRG
enterprises	shareholder and
	its subsidiaries	Service received Repair and maintenance service	By consultation according to full cost	3,306
CSRG and other	De facto controller
railway	of the largest			pricing
enterprises	shareholder and
	its subsidiaries	Purchase of	Purchase of materials and	Based on agreement which determines the	5,128
CSRG and other	De facto controller
railway	of the largest	goods	supplies	price according to purchase amount plus
enterprises	shareholder and			0.3%-5% management fee
	its subsidiaries

025    Interim report

Chapter 5

Matters of Importance

1. Connected transactions in relation to acquisition or disposal of assets or equity interests

• Applicable 3Not Applicable

(3) Material connected transactions in relation to joint external investment

oApplicable  3Not Applicable

(4) Related claims and debts

(Unit: RMB ten thousand)

Related Parties	Connected relationship	Fund provided to related parties
		Opening	Addition	Closing
		balance		balance
Shenzhen Pinghu Qun Yi Railway	Wholly-owned subsidiary	908	-	908
Store Loading and Unloading
Company Limited
Zengcheng Lihua Stock Company	Controlling subsidiary	1,231	-	1,231
Limited
Total		2,139	-	2,139
Impact of the related claim and debt on the operating results	No significant impact.
and financial position of the Company

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XII. MATERIAL CONTRACTS AND IMPLEMENTATION

(1) Trust, contracted businesses and leasing affairs

• Applicable 3Not Applicable

(2) Guarantees

• Applicable 3Not Applicable

(3) Other material contracts or transactions

During the reporting period, except as disclosed in this interim report, the Company did not enter into any other material contracts or transactions.

XIII.POVERTY ALLEVIATION BY LISTED COMPANIES

• Applicable 3Not Applicable

XIV. CONVERTIBLE COMPANY BONDS

• Applicable 3Not Applicable

027    Interim report

Chapter 5

Matters of Importance

XV. EXPLANATION OF ENVIRONMENTAL PROTECTION EFFORTS

1. Explanation of environmental protection efforts taken by companies and its substantial subsidiaries which are the key discharging units announced by environmental protection department

The Company's locomotive maintenance depot in Guangzhou is the key waste discharging unit for water environment and the key unit under supervision for soil pollution of Guangzhou for the year of 2019 as announced by the Bureau of Environmental Protection of Guangzhou Municipality, and the Guangzhou vehicles section is a key waste discharging unit for water environment of Shenzhen for the year of 2019 as announced by the Ecology Environmental Bureau of Shenzhen Municipality.

The environmental protection efforts related to the locomotive maintenance depot in Guangzhou have been disclosed in accordance with the related requirements and the specific requirements of the local government authorities. For more details, please visit the website of the Bureau of Environmental Protection of Guangzhou Municipality at http://210.72.1.33:8013/gzydzf2-enterprise/qyhjbgs/list2018?openMsgTaskId= 201904121253358792652&year=2019

The environmental information related to Guangzhou vehicles section are as follows:

1. Information related to discharge

								The
								audited
						The	Total	total
	Major					discharge	amount of	amount of
Name	pollutants and		Number of		Intensity of	standard	discharge	discharge
of the	the name of the	Way of	discharge	Distribution of	discharge	in force	(tonnes/	(tonnes/	Excess
company	characteristic pollutants	discharge	outfall	discharge outfall	(Mg/L)	(Mg/L)	day)	day)	discharge
Guangzhou	PH	Discharge into the	1	The wastewater	7.82	6-9	300	500	Nil
vehicles section	Petroleum-related	municipal water		treatment plant at	0.04	5
	Synthetic anionic surfactants	distribution network		Sungang passenger	0.05	5
	ammonia nitrogen	after the process at		and technology	5.62	10
	COD	wastewater treatment		station	3.8	90
	BOD	plant			2.3	20

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

2. Pollution prevention and control measures and its implementation

The Sungang passenger and technology station of the Guangzhou vehicles section is supported by a wastewater treatment plant built in 2008 with a daily wastewater processing capacity of 700 tonnes, where hydrolysis acidification and SBR are adopted for wastewater treatment. The whole wastewater treatment system can largely be controlled automatically. Since its establishment, the wastewater treatment processing facility at the Sungang passenger and technology station has been operating normally, with all treated wastewater meeting discharge standards.

3. The evaluation of environmental impacts from construction projects and the information related to other administrative permissions for environmental protection

The wastewater treatment plant at the Sungang passenger and technology station of the Guangzhou vehicles section has the pollutants discharge permit of Guangdong Province issued by the Human Settlements and Environment Commission of Shenzhen Municipality, which will expire on 25 September 2022.

4. The contingency plan for environmental emergencies

The Sungang passenger and technology station of the Guangzhou vehicles section has developed a detailed and practical contingency plan (wastewater-specific) for environmental emergencies to ensure the efficient process for the emergencies which may cause destruction to the environment and ecology and to minimise the loss and damages to the community resulted from various environmental emergencies.

5. Automatic environmental supervision

The wastewater treatment plant at the Sungang passenger and technology station of the Guangzhou vehicles section is equipped with automatic water quality monitoring equipment for real-time monitoring of water quality, to ensure all treated wastewater will meet discharge standards. In addition, qualified supervisors are engaged to perform regular inspection on water quality.

6. Other environmental information which should be disclosed

• Applicable 3Not Applicable

029    Interim report

Chapter 5

Matters of Importance

1. Explanation on the environmental protection efforts by the companies other than the key discharging units

• Applicable 3Not Applicable

1. Explanation on the reasons fornon-disclosure of environmental protection efforts by the companies other than the key discharging units

• Applicable 3Not Applicable

1. Explanation on thefollow-up plans or subsequent changes on the disclosure of environmental protection efforts during the reporting period

• Applicable 3Not Applicable

XVI. Corporate Governance

(1) Summary of Corporate Governance

Since the listing of the Company on the SEHK and the NYSE in 1996 and on the SSE in 2006, the Company has been continuously improving its corporate governance structure, perfecting the internal control and management systems, enhancing information disclosures and regulating its operation in accordance with the relevant domestic and overseas listing rules and regulatory requirements, after taking into account the actual status of the affairs of the Company. General meetings, the Board and the Supervisory Committee of the Company have clearly defined powers and duties, each assuming and performing its specific responsibilities and making its own decisions in an independent, efficient and transparent manner. Currently, there is no material difference between the status quo of the Company's corporate governance structure and the regulatory documents of the regulatory authorities of the places of listing of the Company's stocks relating to corporate governance of a listed company.

During the reporting period, in view of the highly centralized and systematic transportation management over the nationwide railway network, it is necessary for the Company's largest shareholder, GRGC, to obtain the Company's financial information in order to exercise its administrative functions as an industry leader according to the law and administrative regulations. In this regard, the Company has been providing GRGC with its monthly financial data summaries during the reporting period. Accordingly, the Company meticulously reinforced the management of undisclosed information in accordance with the requirements under the System for the Management of Inside Information and Insiders, and timely reminded the shareholders of their duties in relation to information confidentiality and prevention of insider transactions.

Improvement of corporate governance is a long-term systematic project, which needs continuous improvement and enhancement. The Company will, as it has always had, continue to promptly update and improve its internal systems according to the relevant regulations, timely discover and solve problems, strengthen its management basis and enhance its awareness of standardized operation and the level of governance to promote the regulated, healthy and sustainable development of the Company.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

(2) The Board

The Board comprises nine members, including three independent non-executive Directors. The executive Directors have years of experience in the railway industry. The independent non-executive Directors come from various industries with different backgrounds and rich experiences and they possess appropriate professional qualifications in accounting or related fields.

The Board has established the audit committee and the remuneration committee to supervise relevant affairs of the Company. Each committee has specific terms of reference, reports to and gives advice to the Board on a regular basis.

(3) Audit committee

Members of the audit committee were appointed by the Board. It consists of three independent non- executive Directors, namely, Mr. Chen Song (chairman of audit committee), Mr. Jia Jianmin and Mr. Wang Yunting. They possess appropriate academic and professional qualifications or related financial management expertise. The secretary to the Board of the Company, Mr. Guo Xiangdong, is the secretary of the audit committee.

According to the requirements of the Terms of Reference of Audit Committee of the Company, the principal duties of the audit committee include but are not limited to reviewing the financial performance of the Company and its subsidiaries, confirming the nature and scope of audit as well as supervising the establishment of the internal control and compliance with the relevant laws and regulations. It shall also discuss matters raised by the internal auditors, external auditors and regulatory authorities to ensure that all appropriate auditing recommendations are implemented. The audit committee has been provided with adequate resources from the Company to perform its duties.

The 2019 interim report (including the unaudited interim financial statements for the 6 months ended 30 June 2019) of the Company has been reviewed by the audit committee.

(4) Remuneration committee

Members of the remuneration committee of the Company were appointed by the Board. It consists of three independent non-executive Directors and two executive Directors, namely, Mr. Wu Yong, Mr. Hu Lingling, Mr. Chen Song (chairman of remuneration committee), Mr. Jia Jianmin and Mr. Wang Yunting.

According to the requirements of the Terms of Reference of Remuneration Committee of the Company, the principal duties of the remuneration committee include reviewing and making recommendations to the Board for the remuneration packages for the Directors and the Supervisors. The remuneration policy of the Company seeks to provide, in accordance with the Company's business development strategy, reasonable remuneration to attract and retain high caliber executives. The remuneration committee shall obtain the benchmark information from internal and external sources in relation to market remuneration standard, packages offered in the industry and consider the overall performance of the Company when determining the Directors' and the Supervisors' emoluments and recommending the Directors' and the Supervisors' emoluments to the Board. The remuneration committee has been provided with adequate resources from the Company to perform its duties.

031    Interim report

Chapter 5

Matters of Importance

(5) Compliance with the Corporate Governance Code

The Company is always committed to maintaining high standards of corporate governance. During the reporting period, apart from the provision of the Corporate Governance Code on the establishment of a nomination committee, as far as the Company and its Directors are aware, the Company has complied with the relevant code provisions set out in the Corporate Governance Code in Appendix 14 to the Listing Rules of the SEHK.

As at the end of the reporting period, the Board of the Company decided not to set up a nomination committee after prudent consideration of the policy environment and background of the industry to which the Company belongs as well as the corporate governance structure of the Company over a long period of time. According to the requirements of the Articles and the Procedures for Shareholders to Propose a Person for Election as Director, upon expiration of the term of a Director of the Company or there is a vacancy for Director of the Company, shareholders individually or collectively holding three percent or above of the issued shares of the Company may nominate a candidate for non-independent Director by way of a written proposal to the Company; shareholders individually or collectively holding one percent or above of the issued shares of the Company may nominate a candidate for independent Director by way of a written proposal to the Company. Directors of the Company shall be elected at general meetings for a term of office of three years. Upon expiration of his term, Director shall be entitled to be re-elected.

1. Securities transactions by Directors, Supervisors and senior management and interests on competitive business

The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers (the "Model Code") as set out in Appendix 10 to the Listing Rules of the SEHK and the Administrative Rules on Shares Held by the Directors, Supervisors and Senior Management of Listed Companies and the Changes Thereof (Zheng Jian Gong Si Zi [2007] No. 56) of CSRC as its own code of conduct regarding securities transactions of the Directors. The Company formulated the Administrative Rules on Shares Held by the Directors, Supervisors and Senior Management of Guangshen Railway Company Limited and the Changes Thereof, which was approved at the 22nd meeting of the fourth session of the Board.

After making specific enquiries with all the Directors, Supervisors and senior management, the Company confirms that during the reporting period, all the Directors, Supervisors and senior management have complied with the required standard set out in the above-mentioned code, rules and regulations and system requirements.

After making specific enquiries with all the executive Directors, non-executive Directors and Supervisors, the Company confirms that during the reporting period, none of the executive Directors, non-executive Directors and Supervisors has held any interests in businesses that compete or may compete with the businesses of the Company directly or indirectly.

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(7) Investor relations

The secretary to the Board of the Company is in charge of information disclosure and investor relations of the Company. The Company has formulated Working Rules of Secretary to the Board and Management Method of Information Disclosure. The Company has strictly fulfilled the obligation of information disclosure and commenced management of investor relations in accordance with the relevant requirements.

The Company advocates a corporate culture that respects investors and holds itself accountable for investors. The Company establishes a smooth communication channel with investors and enhances mutual trust and interaction based on good information disclosure and initiating various investor relations activities, and respects investors' rights of knowledge and option, while insisting on rewarding its shareholders.

1. Information Disclosure

Credible information disclosure can effectively build a bridge of communication and understanding between investors, regulatory authorities, the public and the Company. This can facilitate a broader and more thorough understanding of the Company's values. For years, according to the basic principles of openness, impartiality and fairness, the Company has been striving to comply with the requirements of the relevant laws and listing rules, and fulfilling the information disclosure obligations in a timely and accurate manner. The Company takes the initiative to understand investors' concerns and voluntarily discloses information in response to these concerns so as to increase its transparency.

In the reporting period, the Company timely completed the preparation and disclosure of its 2018 Annual Report, 2018 Report for Self-assessment on Internal Control, 2018 Social Responsibility Report and 2019 First Quarterly Report, and released various announcements and other shareholders' documents and information disclosing in detail the following information of the Company: operations of the Board, the Supervisory Committee and general meetings, operating conditions, investment, dividends and distribution, corporate governance and so forth. Moreover, the Company consistently maintained to provide in-depth and comprehensive analyses on its operating and financial positions as well as the major factors affecting its business performance in its annual reports and interim reports with a view to strengthening investors' understanding about the operation, management, and development trends of the Company.

033    Interim report

Chapter 5

Matters of Importance

2. Ongoing Communication

On the basis of a competent disclosure of information, the Company maintains an effective two-way communication with investors through various channels and convey information which investors are concerned with, so as to boost their confidence in the Company's future development. Meanwhile, the Company extensively collects feedback from the market to elevate the standards of the Company's governance and operations management.

The Company encourages all shareholders to attend the general meetings. The Company had served a notice 45 days prior to the date of the general meeting, and provided the shareholders with any information necessary for them to attend and make decision at the meeting. Each separate matter submitted to the general meeting to consider was put forth respectively as separate resolution. According to the provisions of the Articles, qualified shareholders of the Company have the right to call general meetings in accordance with the established procedures, propose impromptu motions or collect voting rights from other shareholders. Also, a cumulative voting system is adopted when involving more than 2 candidates for the election of the Directors and the Supervisors by the shareholders. At a general meeting, all attending shareholders are entitled to make enquiries to the Directors and the other management regarding the issues in relation to the resolutions. These arrangements are made to protect the rights of minority shareholders and encourage them to fully express their opinions.

The management of the Company attaches importance to the communication with investors. In commencing investor relation activities, the Company has mainly adopted the following means:

1. Making the public known the investor hotline, investor relationse-mail box and the Investors' Message section on the Company's website, and promptly responding to investors' enquiries.
2. Properly arranging request of visits and researches from the investors, communicating with the investors with anopen-minded attitude, and having built up a direct communication mechanism between investors and the Company.
3. Investors and the public may check out information such as the Company's basic information, rules for the Company's corporate governance, information disclosure documents and profiles of Directors, Supervisors and the senior management at any time on the Company's website.
4. The Company timely handled and replied investors' messages through the"e-interaction" platform developed by the SSE for listed companies and investors.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

3. Shareholder Return

Since its listing, the Company has always been insisting on rendering returns to shareholders and has been distributing annual cash dividends each year with an aggregate cash dividend payment of approximately RMB11.9 billion. The chart of dividend and distribution over the years since the listing of the Company in

1996 is as follows:

			(Unit: RMB)
			Dividend payout ratio
			(dividend per Share/
Year	Earnings per Share	Dividend per Share	earnings per Share)
1996	0.28	0.10	35.71%
1997	0.19	0.12	63.16%
1998	0.15	0.10	66.67%
1999	0.12	0.12	100.00%
2000	0.11	0.10	90.91%
2001	0.12	0.10	83.33%
2002	0.13	0.10	76.92%
2003	0.12	0.105	87.50%
2004	0.13	0.11	84.62%
2005	0.14	0.12	85.71%
2006	0.16	0.08	50.00%
2007	0.20	0.08	40.00%
2008	0.17	0.08	47.06%
2009	0.19	0.08	42.11%
2010	0.22	0.09	40.91%
2011	0.25	0.10	40.00%
2012	0.19	0.08	42.11%
2013	0.18	0.08	44.44%
2014	0.09	0.05	55.56%
2015	0.15	0.08	53.33%
2016	0.16	0.08	50.00%
2017	0.14	0.08	57.14%
2018	0.11	0.06	54.55%
Total	3.70	2.095	56.62%

035    Interim report

Chapter 5

Matters of Importance

XVII.EXPLANATION OF OTHER MATERIAL EVENTS

1. Changes in accounting policies, accounting estimates and accounting methods compared with the previous accounting period, its causes and their impact

Details of the changes in the Company's accounting policies during the reporting period are set out in Note 3 to the financial statements.

1. Material accounting errors during the reporting period subject to retrospective restatements, amendments, its causes and their impact

During the reporting period, there was no correction of material accounting errors of the Company.

(3) Other

During the reporting period, there is no need for the Company to explain any other material event.

036    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

Chapter 6

Changes in Ordinary Share and Particulars of

Shareholders

I. PARTICULARS OF CHANGES IN SHARE CAPITAL

(1) Changes in share

During the reporting period, there was no change in the Company's total number of shares and structure of share capital.

(2) Changes in shares with selling restrictions

• Applicable 3Not Applicable

II. Particulars of shareholders

(1) Number of shareholders:

Number of ordinary shareholders as at the end of the reporting period (number)	227,616

1. Shareholdings of the top ten shareholders and top ten holders of tradable shares (or holders of shares without selling restrictions) up to the end of the reporting period

						(Unit: share)
	Number of	Particulars of the shareholding of the top ten shareholders
		Number	Share in pledge or
	shares held at	Percentage	of shares	frozen	Nature of
Name of shareholders (full name)	the end of the	with selling	Status	Number
period	(%)	restriction held	shareholder
China Railway Guangzhou Group Co., Ltd.	2,629,451,300	37.12	-	Nil	-	State-owned
HKSCC NOMINEES LIMITED (Note)	1,561,159,051	22.04	-	Unknown	-	legal person
Foreign legal
Lin Naigang	124,000,000	1.75	-	Unknown	-	person
Domestic natural
Central Huijin Investment Company Limited	85,985,800	1.21	-	Unknown	-	person
State-owned
China Securities Finance Corporation Limited	53,883,592	0.76	-	Unknown	-	legal person
State-owned
Agricultural Bank of China Limited - CSI 500 Trading Index Securities	40,909,305	0.58	-	Unknown	-	legal person
State-owned
Investment Open-ended Fund	30,390,989	0.43	-	Unknown	-	legal person
Taiyuan Iron and Steel (Group) Co., Ltd.	State-owned
Harvest Fund - Agricultural Bank of China - Harvest CSI Financial	28,101,600	0.40	-	Unknown	-	legal person
Other
Asset Management Plan	27,958,054	0.39	-	Unknown	-	Foreign legal
UBS AG
Yinhua Fund - Agricultural Bank of China - Yinhua CSI Financial	26,814,300	0.38	-	Unknown	-	person
Other

Assets Management Scheme

037    Interim report

Chapter 6

Changes in Ordinary Share and Particulars of

Shareholders

	Top Ten Holders of Shares without Selling Restrictions
	Number of shares	Class and number of the Shares
	without selling
Name of shareholders	restriction held	Class	Number
China Railway Guangzhou Group Co., Ltd.	2,629,451,300	RMB ordinary shares	2,629,451,300
HKSCC NOMINEES LIMITED (Note)	1,561,159,051	RMB ordinary shares	143,546,702
		Overseas listed foreign shares	1,417,612,349
Lin Naigang	124,000,000	RMB ordinary shares	124,000,000
Central Huijin Investment Company Limited	85,985,800	RMB ordinary shares	85,985,800
China Securities Finance Corporation Limited	53,883,592	RMB ordinary shares	53,883,592
Agricultural Bank of China Limited - CSI 500 Trading Index Securities
Investment Open-ended Fund	40,909,305	RMB ordinary shares	40,909,305
Taiyuan Iron and Steel (Group) Co., Ltd.	30,390,989	RMB ordinary shares	30,390,989
Harvest Fund - Agricultural Bank of China - Harvest CSI Financial Asset
Management Plan	28,101,600	RMB ordinary shares	28,101,600
UBS AG	27,958,054	RMB ordinary shares	27,958,054
Yinhua Fund - Agricultural Bank of China - Yinhua CSI Financial Assets
Management Scheme	26,814,300	RMB ordinary shares	26,814,300
Statement regarding connected relationship or concerted action of the above	The Company is not aware of any of the other shareholders above are connected or acting in
shareholders	concert as defined in "Administrative Measures on Acquisitions of Listed Companies".

Note: HKSCC NOMINEES LIMITED represents 香港中央結算（代理人）有限公司, holding 143,546,702 A Shares and 1,417,612,349 H Shares of the Company. These shares were held on behalf of various clients respectively.

The shareholdings and selling restrictions of top 10 shareholders with selling restrictions

oApplicable  3Not Applicable

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

1. So far as the Directors, Supervisors and senior management of the Company are aware, at the end of the reporting period, the following persons, other than Directors, Supervisors and senior management of the Company, held interests and short positions in the shares and underlying shares of the Company as recorded in the register required to be kept under Section 336 of Part XV of the SFO as follows:

					(Unit: Shares)
				Percentage of
				share capital	Percentage
	Class of	Number of		of the same	of total share
Name of shareholder	Shares	Shares held	Capacity	class (%)	capital (%)
China Railway Guangzhou	A share	2,629,451,300(L)	Beneficial owner	46.52(L)	37.12(L)
Group Co., Ltd.
BlackRock, Inc.	H share	157,372,040(L)	Corporate interest	11.00(L)	2.22(L)
		371,050(S)	controlled by	0.03(S)	0.01(S)
			substantial shareholder
Pandanus Associates Inc.	H share	143,718,000(L)	Corporate interest	10.04(L)	2.03(L)
			controlled by
			substantial shareholder
BlackRock Global Funds	H share	114,237,000(L)	Beneficial owner	7.98(L)	1.61(L)
FIDELITY FUNDS	H share	112,580,000(L)	Beneficial owner	7.87(L)	1.59(L)
Kopernik Global Investors	H share	108,763,554(L)	Investment manager	7.60(L)	1.54(L)
LLC

Note: The letter 'L' denotes a long position; 'S' denotes a short position.

1. Strategic Investors or ordinary legal person becoming top 10 shareholders by way of placing of new shares

• Applicable 3Not Applicable

039    Interim report

Chapter 6

Changes in Ordinary Share and Particulars of

Shareholders

III. C h a n g e s i n l a r g e s t S h a r e h o l d e r a n d d e f a c t o Controller

On 18 June 2019, with the approval of the State Council, CRC was restructured and established CSRG, pursuant to which, the original claims, debts, brands, qualifications and licenses and intellectual property rights shall be succeeded by CSRG. Accordingly, the de facto controller of GRGC, the Company's largest shareholder, shall be changed from CRC to CSRG.

IV. Other corporate shareholders with a shareholding of 10% or above

As at the end of the reporting period, apart from the aforesaid largest shareholder, there was no other corporate shareholder with a shareholding of 10% or above in the Company (except for HKSCC NOMINEES LIMITED).

V. PUBLIC FLOAT

As at the end of the reporting period, the public float of the Company was in compliance with the requirements of the relevant rules on the sufficiency of public float.

VI. REPURCHASE, SALE OR REDEMPTION OF THE LISTED SHARES OF THE COMPANY

During the reporting period, there was no repurchase, sale or redemption by the Company, or any of its subsidiaries, of the listed shares of the Company.

VII. PRE-EMPTIVE RIGHT

Under the Articles and the PRC Laws, there is no pre-emptive right, which requires the Company to offer new shares to its existing shareholders on a pro rata basis.

VIII. Transactions involving its own securities

During the reporting period, none of the Company or any of its subsidiaries has issued or granted any convertible securities, options, warrants or other similar rights, or redeemable securities.

040    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

Chapter 7

Information of Preference Shares

• Applicable 3Not Applicable

041    Interim report

Chapter 8

Directors, Supervisors, Senior Management

and Employees

I. CHANGES IN SHAREHOLDINGS

1. Changes in shareholdings of Directors, Supervisors, and senior management (current and resigned during the reporting period)

• Applicable 3Not Applicable

1. Granting of share options to Directors, Supervisors, and senior management during the reporting period

• Applicable 3Not Applicable

II. C h a n g e s o f D i r e c t o r s , S u p e r v i s o r s , a n d S e n i o r management Of the Company

Name	Position held	Change
Xiang Lihua	Shareholder representative supervisor	Elected
Shen Jiancong	Shareholder representative supervisor	Resigned

1. . Equity interests of Directors, Supervisors or Chief Executives

As at the end of the reporting period, there was no record of interests or short positions (including the interests and short positions which were taken or deemed to have under the provisions of the SFO) of the Directors, Supervisors or chief executives of the Company in the shares, underlying shares and debentures of the Company or any associated corporation (within the meaning of the SFO) in the register required to be kept under section 352 of the SFO. The Company had not received notification of such interests or short positions from any Director, Supervisor or chief executives of the Company as required to be made to the Company and the SEHK pursuant to the Model Code in Appendix 10 to the Listing Rules of the SEHK. None of the Company's Directors, Supervisors or chief executives or their respective spouses or children under the age of 18 was granted by the Company any right to subscribe for any shares or debentures of the Company.

Other companies in which Directors, Supervisors or chief executives of the Company were directors or employees did not have interests in shares and underlying shares of the Company required to be disclosed to the Company under Sections 2 and 3 of Part XV of the SFO.

042    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

IV. Information of employees

(1) Number of employees

As at the end of the reporting period, the Company has a total of 41,781 employees, representing a decrease of 957 employees compared with 42,738 employees as at last year's end. The major reason for such decrease is the natural decrease due to employees reaching their retirement age.

(2) Remuneration policy

The Company implements salary budget management, under which an annual salary budget is formulated at the beginning of each year jointly by the budget department and labor department of the Company. Budget is first discussed and approved at the meeting of the general manager's office, and then is organized for implementation by the labor department of the Company after being considered and approved by the Board.

Salary of the Company's staff is mainly comprised of basic salary, performance-based salary and benefit plans. Basic salary includes post salaries, skill salaries and various allowances and subsidies accounted for under salaries payable as required. Performance-based salary refers to salaries calculated on the basis of economic benefits and social benefits, or piece rates calculated on the basis of workload, or performance based salary calculated on the basis of the performance of the staff at the position. Benefit plans include various social insurance and housing funds paid as required by the relevant policies.

In the process of staff salary allocation, the Company always adheres to the principles of allocation based on labor, efficiency-orientation and fairness. It follows that allocation of staff salary is determined on the premises of macro-control, on the basis of post labor assessment, and on the foundation of staff performance assessment, which fully bring out the importance of allocation arrangement in the incentive system of the Company and motivate the staff's initiative.

During the reporting period, the total wages and benefits paid by the Company to its employees are approximately RMB3,486 million.

(3) Training plan

During the reporting period, the Company has 116 occupational education management personnel. A total of 366,267 persons participated in trainings, mainly including training on post standardization, adaptability and qualification and continuing education. The Company has completed 50% of annual training program with relevant expense of approximately RMB11,726,800.

(4) Employee insurance and benefits plan

Pursuant to applicable national policies and industrial regulations, the Company provides the employees with a series of insurance and benefits plan that mainly include: housing fund, retirement pension (basic medical insurance, supplemental retirement pension), medical insurance (basic medical insurance, supplemental medical insurance, birth medical insurance), work-related injury insurance and unemployment insurance.

043    Interim report

Chapter 9

Information of Corporate Bonds

oApplicable  3Not Applicable

044    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

Chapter 10

Financial Statements

INTERIM CONSOLIDATED BALANCE SHEET

AS AT 30 JUNE 2019

		As at	As at
		30 June	31 December
	Note	2019	2018
	RMB'000	RMB'000
		(Unaudited)	(Audited)
ASSETS
Non-current assets	7	23,399,026	24,184,248
Fixed assets - net
Right-of-use assets	3.2	3,069,080	-
Construction-in-progress	7	2,144,659	1,828,372
Prepayments for fixed assets and construction-in-		51,419	51,955
progress
Leasehold land payments		-	1,924,496
Goodwill		281,255	281,255
Investments in associates		169,181	181,725
Deferred tax assets		240,797	197,295
Long-term prepaid expenses		39,623	46,614
Financial assets at fair value through other		351,045	321,246
comprehensive income
Long-term receivable		29,372	28,354
		29,775,457	29,045,560
Current assets		306,370	296,217
Materials and supplies	8
Trade receivables	4,101,236	3,861,617
Prepayments and other receivables		226,436	348,907
Short-term deposits		9,000	109,000
Cash and cash equivalents		1,921,068	1,738,753
Assets classified as held for sale		2,183	2,183
		6,566,293	6,356,677
Total assets		36,341,750	35,402,237

045    Interim report

Chapter 10

Financial Statements

INTERIM CONSOLIDATED BALANCE SHEET (continued)

AS AT 30 JUNE 2019

		As at	As at
		30 June	31 December
	Note	2019	2018
	RMB'000	RMB'000
		(Unaudited)	(Audited)
EQUITY
Capital and reserves attributable to equity holders
of the Company	9	7,083,537	7,083,537
Share capital
Share premium		11,562,657	11,562,657
Other reserves		3,188,161	3,188,161
Retained earnings		7,355,092	7,017,944
Non-controlling interests		29,189,447	28,852,299
	(38,042)	(35,970)
Total equity		29,151,405	28,816,329
LIABILITIES
Non-current liabilities		1,118,351	-
Lease liabilities
Deferred tax liabilities		62,652	63,898
Deferred income related to government grants		97,960	99,765
		1,278,963	163,663
Current liabilities	10	1,379,058	1,440,834
Trade payables
Contract liabilities		197,562	203,631
Payables for fixed assets and construction-in-progress		1,441,845	2,441,647
Dividends payable		437,900	12,894
Income tax payable		200,583	246,441
Current portion of lease liabilities		58,490	-
Accruals and other payables		2,195,944	2,076,798
		5,911,382	6,422,245
Total liabilities		7,190,345	6,585,908
Total equity and liabilities		36,341,750	35,402,237

The above consolidated balance sheet should be read in conjunction with the accompanying notes.

Wu Yong		Hu Lingling
Director	Director

046    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

INTERIM CONDENSED CONSOLIDATED COMPREHENSIVE INCOME STATEMENT

FOR THE SIX MONTHS ENDED 30 JUNE 2019

		For the six months ended
		30 June
		2019	2018
	Note	RMB'000	RMB'000
		(Unaudited)	(Audited)
Revenue from railroad businesses		4,076,095
Passenger		4,012,320
Freight		917,579	865,349
Railway network usage and other transportation		4,740,469
related services		4,245,314
		9,734,143	9,122,983
Revenue from other businesses		452,786	404,790
Total revenue	6	10,186,929	9,527,773
Operating expenses		(8,710,701)
Railroad businesses		(8,230,241)
Other businesses		(443,221)	(424,643)
Total operating expenses		(9,153,922)	(8,654,884)
Reversal of impairment on financial assets		-	3,656
Other gains/(losses) - net		24,785	(9,869)
Profit from operations		1,057,792	866,676
Finance (costs)/income- net		(28,411)	2,215
Share of net (losses)/profits of associates accounted for		(12,544)
using the equity method		4,276
Profit before income tax		1,016,837	873,167
Income tax expenses	11	(256,749)	(221,582)
Profit for the period		760,088	651,585

047    Interim report

Chapter 10

Financial Statements

INTERIM CONDENSED CONSOLIDATED COMPREHENSIVE INCOME

STATEMENT(continued)

FOR THE SIX MONTHS ENDED 30 JUNE 2019

		For the six months ended
		30 June
		2019	2018
	Note	RMB'000	RMB'000
		(Unaudited)	(Audited)
Other comprehensive income		-	-
Total comprehensive income for the period, net of
tax		760,088	651,585
Profit attributable to:		762,160
Equity holders of the Company		654,085
Non-controlling interests		(2,072)	(2,500)
		760,088	651,585
Total comprehensive income attributable to:		762,160
Equity holders of the Company		654,085
Non-controlling interests		(2,072)	(2,500)
		760,088	651,585
Earnings per share for profit attributable to the
equity holders of the Company during the period		RMB 0.11
- Basic and diluted	12	RMB 0.09
Dividends	13	-	-

The above consolidated comprehensive income statement should be read in conjunction with the accompanying notes.

Wu Yong		Hu Lingling
Director	Director

048    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

FOR THE SIX MONTHS ENDED 30 JUNE 2019

			Attributable to equity holders of the Company
			Statutory	Discretionary				Non-
	Share	Share	surplus	surplus	Other	Retained		controlling	Total
	capital	premium	reserve	reserve	reserve	earnings	Total	interests	equity
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Balance at 1 January 2019	7,083,537	11,562,657	2,702,161	304,059	181,941	7,017,944	28,852,299	(35,970)	28,816,329
Total comprehensive income	-	-	-	-	-	762,160	762,160	(2,072)	760,088
Profit for the period	-	-	-	-	-	762,160	762,160	(2,072)	760,088
Other comprehensive income	-	-	-	-	-	-	-	-	-
Special reserve - Safety Production Fund	-	-	-	-	-	-	-	-	-
Appropriation	-	-	-	-	132,436	(132,436)	-	-	-
Utilisation	-	-	-	-	(132,436)	132,436	-	-	-
Dividends relating to 2018	-	-	-	-	-	(425,012)	(425,012)	-	(425,012)
Balance as at 30 June 2019	7,083,537	11,562,657	2,702,161	304,059	181,941	7,355,092	29,189,447	(38,042)	29,151,405
Balance at 31 December 2017	7,083,537	11,562,738	2,623,516	304,059	181,941	6,928,886	28,684,677	(27,596)	28,657,081
Change in Accounting Policy	-	-	(4,967)	-	-	(44,706)	(49,673)	-	(49,673)
Balance at 1 January 2018	7,083,537	11,562,738	2,618,549	304,059	181,941	6,884,180	28,635,004	(27,596)	28,607,408
Total comprehensive income	-	-	-	-	-	654,085	654,085	(2,500)	651,585
Profit for the period	-	-	-	-	-	654,085	654,085	(2,500)	651,585
Other comprehensive income	-	-	-	-	-	-	-	-	-
Special reserve - Safety Production Fund	-	-	-	-	-	-	-	-	-
Appropriation	-	-	-	-	121,228	(121,228)	-	-	-
Utilisation	-	-	-	-	(121,228)	121,228	-	-	-
Dividends relating to 2017	-	-	-	-	-	(566,683)	(566,683)	-	(566,683)
Balance as at 30 June 2018	7,083,537	11,562,738	2,618,549	304,059	181,941	6,971,582	28,722,406	(30,096)	28,692,310

The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.

Wu Yong		Hu Lingling
Director	Director

049    Interim report

Chapter 10

Financial Statements

INTERIM CONSOLIDATED CASH FLOW STATEMENT

FOR THE SIX MONTHS ENDED 30 JUNE 2019

	For the six months ended
	30 June
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Audited)
Cash flows from operating activities	1,712,781
Cash generated from operations	1,695,808
Income tax paid	(347,355)	(240,514)
Net cash generated from operating activities	1,365,426	1,455,294
Cash flows from investing activities
Proceeds from disposal of fixed assets and assets classified as	134,177
held for sale	522,569
Dividends received	7,047	6,473
Interest received	825	887
Decrease in short-term deposits with maturities more than three	100,000
months, net	2,000
Payment for Financial assets at fair value through other	(29,799)
comprehensive income	-
Payments for acquisition of fixed assets, construction-in-progress
and long-term prepaid expenses; and prepayments for fixed	(1,395,361)
assets, net of related payables	(1,214,576)
Net cash used in investing activities	(1,183,111)	(682,647)
Cash flows from financing activities	-
Dividends paid to the Company's shareholders	-
Net increase in cash and cash equivalents	182,315	772,647
Cash and cash equivalents at beginning of the period	1,738,753	1,160,515
Cash and cash equivalents at end of the period	1,921,068	1,933,162

The above consolidated cash flows statement should be read in conjunction with the accompanying notes.

Wu Yong		Hu Lingling
Director	Director

050    Interim report

GUANGSHEN RAILWAY  2019•INTERIM REPORT

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

1. General Information

Guangshen Railway Company Limited (the "Company") was established as a joint stock limited company in the People's Republic of China (the "PRC") on 6 March 1996. On the same date, the Company assumed the business operations of certain railroad and other related businesses (collectively the "Businesses") that had been undertaken previously by its predecessor, Guangshen Railway Company (the "Predecessor"), certain subsidiaries of the Predecessor; and by Guangzhou Railway (Group) Company (the "Guangzhou Railway Group") and certain of its subsidiaries prior to the formation of the Company.

The Predecessor was controlled by and was under the administration of the Guangzhou Railway Group. Pursuant to a restructuring agreement entered into between the Guangzhou Railway Group, the Predecessor and the Company in 1996, the Company issued to the Guangzhou Railway Group 100% of its equity interest in the form of 2,904,250,000 ordinary shares (the "State-owned Domestic Shares") for the exchange of assets and liabilities associated with the operations of the Businesses (the "Restructuring"). After the Restructuring, the Predecessor changed its name to Guangzhou Railway (Group) Guangshen Railway Enterprise Development Company (the "GEDC").

In May 1996, the Company issued 1,431,300,000 shares, representing 217,812,000 H Shares ("H Shares") and 24,269,760 American Depositary Shares ("ADSs", one ADS represents 50 H Shares) in a global public offering for cash of approximately RMB4,214,000,000 in order to finance the capital expenditure and working capital requirements of the Company and its subsidiaries (collectively defined as the "Group").

In December 2006, the Company issued 2,747,987,000 A Shares on the Shanghai Stock Exchange through an initial public offering of shares in order to finance the acquisition of the business and related assets and liabilities associated with the railway transportation business ("Yangcheng Railway Business") of Guangzhou Railway Group Yangcheng Railway Enterprise Development Company ("Yangcheng Railway"), a wholly owned subsidiary of Guangzhou Railway Group which operates a railway line between the cities of Guangzhou and Pingshi in the Southern region of the PRC.

Before March 2013, the Ministry of Railway of the PRC ("MOR") was the controlling entity of the Company's single largest shareholder (i.e. Guangzhou Railway Group). In addition, it was the government authority which governed and monitored the railway business centrally within the PRC.

On 14 March 2013, pursuant to the approved plan of State Council Institutional Reform and Transformation of Government Functions and Approval On Setting Up China Railway Company by the State Council, the previous controlling entity of Guangzhou Railway Group, MOR, was dissolved. The administrative functions of MOR were transferred to the Ministry of Transport and a newly established authority called the National Railway Administration; while the business functions were transferred to the China Railway Corporation (in 2019, its name was changed into China State Railway Group Co., Ltd., "CSRG"). Accordingly, the equity interests of Guangzhou Railway Group, which was wholly controlled by MOR previously, were also transferred to the CSRG ("Reform"). The Reform was completed on 1 January 2017 and CSRG has become the controlling entity of the Company's principal shareholder since that date, Guangzhou Railway Group, CSRG, together with subsidiaries which were wholly controlled by MOR previously (hereinafter collectively as "CSRG Group") became related parties of the Group.

051    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

1. GENERAL INFORMATION (continued)

The principal activities of the Group are the provision of passenger and freight transportation service on railroads. The Group also operates certain other businesses, which principally include services offered in railway stations; and sales of food, beverages and merchandises on board the trains and in the railway stations.

The registered address of the Company is No. 1052 Heping Road, Luohu District, Shenzhen, Guangdong Province, the People's Republic of China.

The interim condensed consolidated financial information (the "Financial Information") were authorised for issue by the board of directors of the Company on 22 August 2019.

The English names of all companies listed in the Financial Information are direct translations of their registered names in Chinese if no registered names in English are available.

The following is a list of the subsidiaries at 30 June 2019:

				Proportion		Proportion
				Proportion	of equity
				of equity	interests
		Place of		interests	of equity	held by
		Principal	held	interests	non-	Registered
		incorporation and	by the	held by	controlling
	Name of the entity	nature of	activities and	Company	the Group	interests	capital
	legal entity	place of operation	(%)	(%)	(%)	RMB'000
	Dongguan Changsheng Enterprise	China, limited	Warehousing in PRC	51%	51%	49%	38,000
	Company Limited	liability company
	Shenzhen Fu Yuan Enterprise	China, limited	Hotel management	100%	100%	-	18,500
	Development Company Limited	liability company	in PRC
	Shenzhen Pinghu Qun Yi Railway	China, limited	Cargo loading	100%	100%	-	10,000
	Store Loading and Unloading	liability company	and unloading,
	Company Limited		warehousing,
			freight
			transportation in
			PRC
	Shenzhen Guangshen Railway	China, limited	Catering	100%	100%	-	2,000
	Economic and Trade Enterprise	liability company	management in
	Company Limited		PRC
	Shenzhen Railway Station	China, limited	Catering services	100%	100%	-	1,500
	Passenger Services Company	liability company	and sales of
	Limited		merchandise in
			PRC

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

1.	GENERAL INFORMATION (continued)
				Proportion		Proportion
				Proportion	of equity
				of equity	interests
		Place of		interests	of equity	held by
		Principal	held	interests	non-	Registered
		incorporation and	by the	held by	controlling
	Name of the entity	nature of	activities and	Company	the Group	interests	capital
	legal entity	place of operation	(%)	(%)	(%)	RMB'000
	Guangshen Railway Station	China, limited	Sales of	100%	100%	-	1,020
	Dongqun Trade and Commerce	liability company	merchandises in
	Service Company Limited		PRC
	Guangzhou Railway Huangpu	China, limited	Cargo loading	100%	100%	-	379
	Service Company Limited	liability company	and unloading,
			warehousing,
			freight
			transportation in
			PRC
	Zengcheng Lihua Stock Company	China, limited	Real estate	44.72%	44.72%	55.28%	107,050
	Limited ("Zengcheng Lihua") (i)	liability company	construction,
			provision of

warehousing, cargo uploading and unloading services

1. According to the Articles of Association of Zengcheng Lihua, the remaining shareholders are all natural persons and none of these individuals holds more than 0.5% equity interest in Zengcheng Lihua. All directors of Zengcheng Lihua were appointed by the Company. After considering all shareholders of Zengcheng Lihua other than the Company are individuals with individual interest holding of less than 0.5% and such individuals do not act in concert, and also all directors of Zengcheng Lihua were appointed by the Company, the directors of the Company consider that the Company has the de facto control over the board and the substantial financial and operating decisions of Zengcheng Lihua.

As at 30 June 2019, the non-wholly owned subsidiaries individually and in aggregate are not significant to the Group. Therefore, financial information of the non-wholly owned subsidiaries is not disclosed.

This interim condensed consolidated financial information was approved for issue on 22 August 2019.

This interim condensed consolidated financial information has not been audited.

053    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

2. Basis of preparation

This interim condensed consolidated financial information for the six months ended 30 June 2019 has been prepared in accordance with International Accounting Standard ("IAS") 34, 'Interim financial reporting'.

The interim condensed consolidated financial information should be read in conjunction with the annual financial statements for the year ended 31 December 2018, which have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by International Accounting Standards Board ("IASB"), the disclosure requirements of The Stock Exchange of Hong Kong Limited and any public announcements made by the Company during the interim reporting period. The interim condensed consolidated financial information have been prepared under the historical cost convention except for financial assets at fair value through other comprehensive income ("FVOCI").

3. Accounting policies

The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2018, as described in those annual financial statements except for the adoption of new and amended standards as set out below.

1. New and amended standards adopted by the Group
   A number of new or amended standards became applicable for the current reporting period and the Group had to change its accounting policies as a result of adopting IFRS 16 Leases.
   Amendments to IFRSs effective for the period ended 30 June 2019 do not have a material impact on the Group's Interim Financial Information except IFRS 16 Leases, details of which are set out in Note 3.2 below.
   Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual earnings.
2. Changes in accounting policies
   This note explains the impact of the adoption of IFRS 16 Leases on the Group's financial statements and discloses the new accounting policies that have been applied from 1 January 2019, where they are different to those applied in prior periods.
   The Group has adopted IFRS 16 retrospectively from 1 January 2019, but has not restated comparatives for the 2018 reporting period, as permitted under the specific transitional provisions in the standard. The reclassifications and the adjustments arising from the new leasing rules are therefore recognised in the opening balance sheet on 1 January 2019.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

3. Accounting policies (continued)

3.2 Changes in accounting policies (continued)

1. Adjustments recognised on adoption of IFRS 16
   On adoption of IFRS 16, the Group recognised lease liabilities in relation to leases which had previously been classified as 'operating leases' under the principles of IAS 17 Leases. These liabilities were measured at the present value of the remaining lease payments, discounted using the lessee's incremental borrowing rate as of 1 January 2019. The lessee's incremental borrowing rate applied to the lease liabilities on 1 January 2019 was 4.9%.

	2019
	RMB'000
Operating lease commitments disclosed as at 31 December	467,920
2018
Add: adjustments as a result of excericsing of extension options	4,679,200
Total undiscounted lease liability as at 1 January 2019	5,147,120
Discounted using the lessee's incremental borrowing rate of at the	1,177,246
date of initial application
Lease liability recognised as at 1 January 2019	1,177,246
Of which are:	58,490
Current lease liabilities
Non-current lease liabilities	1,118,756

The right-of-use assets were measured at the amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognised in the balance sheet as at 31 December 2018. There were no onerous lease contracts that would have required an adjustment to the right-of-use assets at the date of initial application.

The change in accounting policy affected the following items in the balance sheet on 1 January 2019:

• right-of-useassets - increase by RMB3,101,742
• leasehold land payments - decrease by RMB1,924,496
• lease liabilities - increase by RMB1,177,246

There was no impact on retained earnings on 1 January 2019.

055    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

3. Accounting policies (continued)

3.2 Changes in accounting policies (continued)

1. Amount recognised in the statement of financial position and profit or loss

	Right-of-use assets
		Lease of
	Land	Land		Lease
	use right	use right	Total	liabilities
	RMB'000	RMB'000	RMB'000	RMB'000
As at 1 January 2019	1,924,496	1,177,246	3,101,742	1,177,246
Depreciation charge	(25,973)	(6,689)	(32,662)	-
Interest expense	-	-	-	28,840
Payments	-	-	-	(29,245)
As at 30 June 2019	1,898,523	1,170,557	3,069,080	1,176,841

1. The Group's leasing activities and how these are accounted for
   The Group's operating leases mainly consisted of lease of land for self-occupied purpose. In connection with the acquisition of Yangcheng Railway Business, the Company signed an agreement on 15 November 2004 with Guangzhou Railway Group for leasing the land use rights associated with a parcel of land, on which the acquired assets of Yangcheng Railway Business are located. The agreement became effective upon the completion of the acquisition on 1 January 2007 and the lease term is 20 years, renewable at the discretion of the Group.
   Until the 2018 financial year, this lease of land were classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) were charged to profit or loss on a straight-line basis over the period of the lease.
   From 1 January 2019, leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

3. Accounting policies (continued)

3.2 Changes in accounting policies (continued)

1. The Group's leasing activities and how these are accounted for(continued)
   The estimated useful lives of some buildings, tracks, bridges and service roads exceed the initial lease periods of the land use rights from operation lease; and the initial period of certain land use right acquired, on which these assets are located. Based on the provision of the land use right operating lease agreement entered into with Guangzhou Railway Group, the Company can renew the lease at its own discretion upon expiry of the operating lease term, and the Company except to exercise the option to extend the lease within the remaining useful lives of those assets. Therefore the Group is reasonably certain to determine the lease term as 88 years.
   Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments:
2. • fixed payments (includingin-substance fixed payments), less any lease incentives receivable
   • variable lease payment that are based on an index or a rate
   • amounts expected to be payable by the lessee under residual value guarantees
   • the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
   • payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option.

The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be determined, the lessee's incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar economic environment with similar terms and conditions.

Right-of-use assets are measured at cost comprising the following:

• the amount of the initial measurement of lease liability
• any lease payments made at or before the commencement date less any lease incentives received
• any initial direct costs, and
• restoration costs.

Payments associated with short-term leases and leases of low-value assets are recognised on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT-equipment and small items of office furniture.

057    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

4. Financial risk management

1. Financial risk factors
   The Group's activities expose it to a variety of financial risks: market risk (including foreign currency risk and cash flow and fair value interest rate risk), credit risk, and liquidity risk.
   The interim condensed consolidated financial information does not include all financial risk management information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements for the year ended 31 December 2018.
   There have been no changes in the risk management department since year end or in any risk management policies.
2. Liquidity risk
   Compared to year end, there was no material change in the contractual undiscounted cash out flows for financial liabilities except for the recognition of lease liabilities as result of adoption of IFRS 16.
3. Fair value estimation
   According to amendment to IFRS 7 for financial instruments that are measured in the balance sheet at fair value, it requires disclosure of fair value measurements by level of following fair value measurement hierarchy:
4. • Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1).
   • Inputs other than quoted prices included within level 1 that are observable for the assets or liabilities, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2).
   • Inputs for the assets or liabilities that are not based on observable market data (that is, unobservable inputs) (level 3).

As at 30 June 2019, except for FVOCI, the Group did not have any financial instruments that were measured at fair value.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

4. Financial risk management (continued)

1. Fair value estimation(continued)
   The following table presents the Group's assets that are measured at fair value at 30 June 2019:

	Level 1	Level 2	Level 3	Total
	RMB'000	RMB'000	RMB'000	RMB'000
Assets
Financial assets at FVOCI
Equity investment in unlisted
companies	-	-	351,045	351,045

The following table presents the Group's assets that are measured at fair value at 31 December 2018:

	Level 1	Level 2	Level 3	Total
	RMB'000	RMB'000	RMB'000	RMB'000
Assets
Financial assets at FVOCI
Equity investment in unlisted
companies	-	-	321,246	321,246

There were no transfers between levels 1, 2 and 3 during the period.

There were no changes in valuation techniques during the period.

There were no gains/(losses) recognised for the period ended 30 June 2019.

Financial assets and liabilities of the Group measured at amortised cost include trade and other receivables, short-time deposits, cash and cash equivalents, lease liabilities, and trade and other payables, of which the fair values approximate their carrying amounts.

059    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

5. Estimates

The preparation of interim financial information requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

In preparing this interim condensed consolidated financial information, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended 31 December 2018, except for the determination of lease term (note 3.2).

The Group determine the lease term as the non-cancellable period of a lease, together with periods covered by an option to extend or terminate the lease if the Group is reasonably certain to or not to exercise that option. In assessing that option, the Group takes into consideration the estimated useful lives of the assets located on the underlying assets and all other relevant facts and circumstances.

6. Segment information

The chief operating decision-makers have been identified as senior executives. Senior executives review the Group's internal reporting in order to assess performance and allocate resources. The operating segments were determined based on these management reports.

Senior executives evaluate the business from a perspective of revenues and operating results generated from railroad and related business conducted by the Company ("the Railway Transportation Business"). Other segments mainly include on-board catering services, leasing, sales of materials, sale of goods and other businesses related to railway transportation provided by the subsidiaries of the Company. Senior executives assess the performance of the operating segments based on a measure of the profit before income tax. Other information provided, except as noted below, to senior executives is measured in a manner consistent with that in the financial statements.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

6. Segment information (continued)

The segment results for the six months ended 30 June 2019 and 30 June 2018 are as follows:

			For the six months ended 30 June (unaudited)
	The Railway
	Transportation Business	All other segments	Elimination	Total
	2019	2018	2019	2018	2019	2018	2019	2018
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Segment revenue	9,734,143		-		-		9,734,143
- Railroad Businesses	9,122,983	-	-	9,122,983
- Other Businesses	348,465	294,189	136,441	130,647	(32,120)	(20,046)	452,786	404,790
Total revenue	10,082,608	9,417,172	136,441	130,647	(32,120)	(20,046)	10,186,929	9,527,773
Segment results	1,032,342	884,767	(2,961)	(328)	(12,544)	(11,272)	1,016,837	873,167
Finance (costs)/income-net	(28,291)	2,303	(120)	(88)	-	-	(28,411)	2,215
Share of net profits of associates	(12,544)	4,276	-	-	-	-	(12,544)	4,276
Depreciation of fixed assets	(810,293)	(782,718)	(2,336)	(3,247)	-	-	(812,629)	(785,965)
Depreciation of right-of-use	(26,996)		(5,666)		-		(32,662)
assets	-	-	-	-
Amortisation of leasehold land	-		-				-
payments	(21,154)	(5,666)		-	(26,820)
Amortisation of long-term prepaid	(7,486)		(218)				(7,704)
expenses	(5,269)	(73)		-	(5,342)
Impairment of materials and	-		-		-		-
supplies	(203)	-	-	(203)
Provision of impairment of	-		-		-		-
receivables	3,662	(6)	-	3,656
A reconciliation of segment result to profit for the period is provided as follows:
Segment results	1,032,342	884,767	(2,961)	(328)	(12,544)	(11,272)	1,016,837	873,167
Income tax expenses	(257,995)	(222,636)	1,246	1,054	-	-	(256,749)	(221,582)
Profit for the period	774,347	662,131	(1,715)	726	(12,544)	(11,272)	760,088	651,585

061    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

6. Segment information (continued)

The segment information about the Group's assets and liabilities as at 30 June 2019 and 31 December

2018 are as follows:

	The Railway
	Transportation Business	All other segments	Elimination	Total
	As at	As at	As at	As at	As at	As at	As at	As at
	30 June	31 December	30 June	31 December	30 June	31 December	30 June	31 December
	2019	2018	2019	2018	2019	2018	2019	2018
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
	(Unaudited)	(Audited)	(Unaudited)	(Audited)	(Unaudited)	(Audited)	(Unaudited)	(Audited)
Total segment assets	36,061,377	35,089,100	490,728	496,353	(210,354)	(183,216)	36,341,751	35,402,237
Total segment assets include:	169,181		-		-		169,181
Investments in associates	181,725	-	-	181,725
Additions to non-current
assets (other than financial
instruments, investments in
associates and deferred tax	357,387		21		-		357,408
assets)	2,885,650	7,635	-	2,893,285
Total segment liabilities	6,786,449	6,163,507	567,363	571,273	(163,466)	(148,872)	7,190,346	6,585,908

The Group is domiciled in the PRC. All the Group's revenues were generated in the PRC, and the all of the assets are also located in the PRC.

Revenues of approximately RMB2,153,362,000 (for the six months ended 30 June 2018: RMB1,740,128,000) are derived from Guangzhou Railway Group and its subsidiaries. These revenues are attributable to the Railway Transportation Business. Except that, no revenues derived from a single external customer have exceeded 10% of the total revenues.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

7. Fixed assets and construction-in-progress

	Six months ended 30 June
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Unaudited)
Opening net book amount as at 1 January	26,012,620	25,047,809
Additions	359,553	706,492
Disposal	(15,859)	(174,136)
Depreciation	(812,629)	(785,965)
Closing net book amount as at 30 June	25,543,685	24,794,200
(a) As at 30 June 2019, the ownership certificates	of certain buildings	of the Group with

an aggregate carrying value of approximately RMB1,635,832,000 (31 December 2018: RMB1,676,711,000) had not been obtained by the Group.

These kind of buildings are classified as below:

		Carrying value
		As at	As at
		30 June	31 December	Reason for delay in obtaining
		2019	2018	the ownership certificates
		RMB'000	RMB'000
	Certificates for	1,025,222	1,067,076	The Group commenced such application
	buildings under			procedures with the respective authorities in
	application			China by the end of 2017, and the Group's
	procedures			management expects that these procedures
				would be completed within a short period of
				time and the ownership certificates will be
				obtained.
	Certain buildings	50,717	53,392	According to relevant laws and regulations in
	located on the			China, the land use right certificates of the
	land of which			land on which these buildings are located
	the land use			must be obtained before the Group can start
	right certificates			the application for the respective housing
	have not been			ownership certificates. As a result, the
	obtained			Group will start to apply for the ownership
				certificates of these buildings after they
				have completed the procedures to obtain the
				land use right certificates.

063    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

7. Fixed assets and construction-in-progress(continued)

(a)	(continued)
		Carrying value
		As at	As at
		30 June	31 December		Reason for delay in obtaining
		2019	2018		the ownership certificates
		RMB'000	RMB'000
	Certain buildings	559,893	556,243	Such	land is held by lease under certain
	attached to			operating lease arrangements. Due to the
	pieces of land			fact that the Group does not have the
	which is held by			underlying land use right certificates for
	lease			such land, therefore, the Group cannot apply
				for	the respective ownership certificates
				of the buildings constructed on top of it.
				According to the lease agreements and
				communication with the leasors, and as

confirmed by the Company's legal counsel, the Group possesses the right to use and/or own such buildings without the certificates.

After consultation made with the Company's legal counsel, the directors of the Company consider that there is no legal restriction for the Group to apply for and obtain the ownership certificates of such buildings and it should not lead to any significant adverse impact on the operations of the Group.

1. As at 30 June 2019, fixed assets of the Group with an aggregate net book value of approximately RMB151,033,000 (31 December 2018: RMB138,390,000) had been fully depreciated but they were still in use.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

8. Trade receivables

	As at	As at
	30 June	31 December
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Audited)
Trade receivables	4,162,448	3,922,829
Including: receivables from related parties	3,210,442	2,949,492
Less:Provision for doubtful accounts	(61,212)	(61,212)
	4,101,236	3,861,617

The passenger railroad services are usually transacted on a cash basis. The Group does not have formal contractual credit terms agreed with its customers for freight services but the trade receivables are usually settled within a period less than one year. The aging analysis of the outstanding trade receivables is as follows:

		As at	As at
		30 June	31 December
		2019	2018
		RMB'000	RMB'000
		(Unaudited)	(Audited)
Within 1 year	3,062,958	3,034,930
Over 1	year but within 2 years	510,371	524,652
Over 2	years but within 3 years	407,440	231,879
Over 3	years	181,679	131,368
		4,162,448	3,922,829

065    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

9. Share capital

As at 30 June 2019 and 31 December 2018, the total number of ordinary shares is 7,083,537 shares with a par value of RMB 1.00 per share:

	As at 30 June
	2019 and
	31 December
	2018
	RMB'000
Ordinary shares, issued and fully paid
- H Shares	1,431,300
- A Shares	5,652,237
	7,083,537

There has been no movement of the issued and fully paid share capital during the period.

10. Trade payables

The aging analysis of trade payables based on the contracted payment date was as follows:

		As at	As at
		30 June	31 December
		2019	2018
		RMB'000	RMB'000
		(Unaudited)	(Audited)
Within 1 year	1,318,906	1,233,902
Over 1	year but within 2 years	11,487	114,480
Over 2	years but within 3 years	11,756	46,383
Over 3	years	36,909	46,069
		1,379,058	1,440,834

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11. Income tax expense

An analysis of the current period taxation charges is as follows:

	Six months ended 30 June
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Unaudited)
Current income tax	301,497	221,421
Deferred income tax	(44,748)	161
	256,749	221,582

12. Earnings per share

The calculation of basic earnings per share is based on the net profit for the six months ended 30 June 2019 attributable to shareholders of RMB762,160,000 (2018: RMB654,085,000), divided by the weighted average number of ordinary shares outstanding during the period of 7,083,537,000 shares (2018: 7,083,537,000 shares). There were no dilutive potential ordinary shares as at period end and therefore the diluted earnings per share amount is the same as the basic earnings per share.

13. Dividends

No appropriation from retained earnings had been made to the statutory reserves for the six months ended 30 June 2019.

In 27 March 2019, the Board of Directors declared a dividend of RMB0.06 per share in respect of the year ended 31 December 2018, totalling RMB425,012,000 (2018: RMB566,683,000), and it was approved by shareholders in the Annual General Meeting on 13 June 2019.

There was no interim dividend for the six months ended 30 June 2019 (2018: nil) proposed by the Board of Directors as at 22 August 2019.

067    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

14. Commitments

1. Capital commitments
   As at 30 June 2019, the Group had the following capital commitments which are authorised but not contracted for, and contracted but not provided for:

	As at	As at
	30 June	31 December
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Audited)
Authorised but not contracted for	1,873,157	1,765,710
Contracted but not provided for	791,843	899,290

A substantial amount of these commitments is related to the reform of railway stations or facilities relating to the existing railway lines operated by the Group. The related financing would be from self-generated operating cash flows and bank facilities.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

15. Related party transactions

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions.

1. Save as disclosed in other notes to the Financial Information, for the six months ended 30 June 2019, the Group had the following material transactions undertaken with related parties:

	Six months ended 30 June
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Unaudited)
Provision of services and sales of goods
Transportation related services
Provision of train transportation services to	997,271	726,858
Guangzhou Railway Group and its subsidiaries (i)
Revenue collected by CSRG for railway network
usage and related services provided to Guangzhou	762,715	676,197
Railway Group and its subsidiaries (ii)
Revenue from railway operation service provided to	403,400	345,930
Guangzhou Railway Group's subsidiaries (iii)
	2,163,386	1,748,985
Other services
Sales of materials and supplies to Guangzhou Railway	18,094	11,328
Group and its subsidiaries (iv)
	18,094	11,328
Services received and purchases made
Transportation related services
Provision of train transportation services provided by	609,625	582,184
Guangzhou Railway Group and its subsidiaries (i)
Cost settled by CSRG for railway network usage and
related services provided by Guangzhou Railway	1,060,125	965,931
Group and its subsidiaries (ii)
Operating lease rental paid to Guangzhou Railway	29,810	27,292
Group for the leasing of land use rights (Note 3.2)
	1,699,560	1,575,407

069    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

15. Related party transactions (continued)

1. Save as disclosed in other notes to the Financial Information, for the six months ended 30 June 2019, the Group had the following material transactions undertaken with related parties(continued):

	Six months ended 30 June
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Unaudited)
Other services
Provision of repair and maintenance services by	145,438	97,839
Guangzhou Railway Group and its subsidiaries (iv)
Purchase of materials and supplies from Guangzhou	169,329	182,379
Railway Group and its subsidiaries (v)
Provision of construction services by Guangzhou	20,742	77,773
Railway Group and its subsidiaries (vi)
	335,509	357,991

1. 1. The service charges are determined based on a pricing scheme set by the CSRG or based on negotiation between the contracting parties with reference to full cost principle.
   2. Such revenues/charges are determined by the CSRG based on its standard charges applied on a nationwide basis.
   3. The service charges are levied based on contract prices determined based on a "cost plus a profit margin" and explicitly agreed between both contracting parties.
   4. The prices are determined based on mutual negotiation between the contracting parties with reference to full cost principle.
   5. The prices are determined based on mutual negotiation between the contracting parties with reference to procurement costs incurred plus a management fee ranged from 0.3% to 5% on the costs.
   6. Based on construction amounts determined under the national railway engineering guidelines.
2. Key management compensation
   The compensation paid and payable to directors and supervisors of the Group, representing key management personnel, amounted to RMB1,604,069 for the six months ended 30 June 2019 (2018: RMB1,433,117).

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

15. Related party transactions (continued)

1. As at 30 June 2019, the Group had the following material balances maintained with related parties:

	As at	As at
	30 June	31 December
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Audited)
Trade receivables	1,875,237	1,934,435
- Guangzhou Railway Group (i)	285,941	586,049
- Subsidiaries of Guangzhou Railway Group (i)	1,589,286	1,348,386
- Associates	10	-
Prepayments and other receivables	31,983	33,957
- Guangzhou Railway Group	346	231
- Subsidiaries of Guangzhou Railway Group	31,572	33,726
- Associates	65	-
Prepayments for fixed assets and construction-in-	1,546	2,489
progress
- Subsidiaries of Guangzhou Railway Group	640	329
- Associates	906	2,160
Trade payables	544,866	597,050
- Guangzhou Railway Group (i)	104,879	95,048
- Subsidiaries of Guangzhou Railway Group (ii)	439,548	500,385
- Associates	439	1,617
Payables for fixed assets and construction-in-progress	193,188	388,482
- Guangzhou Railway Group	6,873	42,604
- Subsidiaries of Guangzhou Railway Group	63,682	211,486
- Associates	122,633	134,392
Contract liabilities	95	1,100
- Subsidiaries of Guangzhou Railway Group	91	1,096
- Associates	4	4
Accruals and other payables	439,487	454,670
- Guangzhou Railway Group	9,543	9,212
- Subsidiaries of Guangzhou Railway Group (iii)	427,433	443,391
- Associates (iv)	2,511	2,067
Lease liabilities	1,176,841	-
- Guangzhou Railway Group	1,176,841	-

071    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

15. Related party transactions (continued)

1. As at 30 June 2019, the Group had the following material balances maintained with related parties (continued):
2. 1. The trade balances due from/to Guangzhou Railway Group, subsidiaries of Guangzhou Railway Group mainly represented service fees and charges payable and receivable balances arising from the provision of passenger transportation and cargo forwarding businesses jointly with these related parties within the PRC.
   2. The trade payables due to subsidiaries of Guangzhou Railway Group mainly represented payables arising from unsettled fees for purchase of materials and provision of other services according to various service agreements entered into between the Group and the related parties.
   3. The other payables due to subsidiaries of Guangzhou Railway Group mainly represented the performance deposits received for construction projects and deposits received from ticketing agencies.
   4. The other payables due to associates mainly represented the performance deposits received for construction projects operated by associates.

As at 30 June 2019, all the balances maintained with related parties were unsecured, non- interest bearing and were repayable on demand.

16. Transactions with CSRG and other railway companies

On 14 March 2013, pursuant to the Approval, the previous controlling entity of Guangzhou Railway Group, MOR, had been dismantled. The administrative function of MOR were transferred to the Ministry of Transport and the newly established National Railway Bureau, and its business functions were transferred to the CSRG. Accordingly, the equity interests of Guangzhou Railway Group which was wholly controlled by MOR previously were transferred to the CSRG ("Reform"). The Reform was completed since 1 January 2017 and the Company disclosed details of transactions undertaken with CSRG Group for both six months ended 30 June 2019 and 2018 for reference. Unless otherwise specified, the transactions with CSRG Group disclosed below have excluded transactions undertaken with Guangzhou Railway Group and its subsidiaries.

The Group works in cooperation with the CSRG and other railway companies owned and controlled by the CSRG for the operation of certain long distance passenger train and freight transportation businesses within the PRC. The revenues generated therefrom are collected and settled by the CSRG according to its central recording and settlement systems. The charges for the use of the rail lines and services provided by other railway companies are also instructed by the CSRG and settled by the CSRG based on its systems. Since March 2013, the collecting, processing and distribution functions of revenues which were executed by MOR previously have been transferred to CSRG. As at 30 June 2019, the cooperation mode and pricing model had not been subject to any material changes.

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

16. Transactions with CSRG and other railway companies

(continued)

1. Save as disclosed in other notes to the Financial Information, for the six months ended 30 June 2019, the Group had the following material transactions undertaken with the CSRG Group:

		Six months ended 30 June
		2019	2018
		RMB'000	RMB'000
		(Unaudited)	(Unaudited)
	Provide Services and sales of goods
	Transportation related services
	Provision of train transportation services to CSRG	9,756	10,293
	Group (i)
	Revenue collected by CSRG for services provided to	1,304,960	1,258,506
	CSRG Group (ii)
	Revenue from railway operation service provided to	1,087,152	1,009,270
	CSRG Group (iii)
		2,401,868	2,278,069
	Other services
	Provision of repairing services for cargo trucks to	169,516	135,253
	CSRG Group (ii)
	Sales of materials and supplies to CSRG Group (iv)	2,837	3,889
	Provision of leasing services to CSRG Group (iv)	259	259
		172,612	139,401
	Receive Services and purchase of goods
	Transportation related services
	Provision of train transportation services by CSRG	146,812	138,792
	Group (i)
	Cost settled by CSRG for services provided by CSRG	1,103,693	1,078,322
	Group (ii)
		1,250,505	1,217,114
	Other services
	Provision of repair and maintenance services by CSRG	3,306	6,559
	Group (iv)
	Purchase of materials and supplies from CSRG Group (v)	5,128	5,220
		8,434	11,779

073    Interim report

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2019

(All amounts expressed in Renminbi unless otherwise stated)

16. Transactions with CSRG and other railway companies

(continued)

1. Save as disclosed in other notes to the Financial Information, for the six months ended 30 June 2019, the Group had the following material transactions undertaken with the CSRG Group (continued):
2. 1. The service charges are determined based on a pricing scheme set by the CSRG or based on negotiation between the contracting parties with reference to full cost principle.
   2. Such revenues/charges are determined by the CSRG based on its standard charges applied on a nationwide basis.
   3. The service charges are levied based on contract prices determined based on a "cost plus a profit margin" and explicitly agreed between both contracting parties.
   4. The prices are determined based on mutual negotiation between the contracting parties with reference to full cost principle.
   5. The prices are determined based on mutual negotiation between the contracting parties with reference to procurement costs incurred plus a management fee ranged from 0.3% to 5% on the costs.
3. Revenue collected and settled through the CSRG:

Six months ended 30 June

20192018

RMB'000 RMB'000

(Unaudited) (Unaudited)

- Passenger transportation	3,788,811	3,761,102
- Freight transportation	917,579	865,349
- Luggage and parcel	29,597	38,232
	4,735,987	4,664,683

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GUANGSHEN RAILWAY  2019•INTERIM REPORT

16. Transactions with CSRG and other railway companies

(continued)

1. Balances due from/to CSRG Group:
   As at 30 June 2019 and 31 December 2018, the Group had the following material balances with CSRG and its subsidiaries:

	As at	As at
	30 June	31 December
	2019	2018
	RMB'000	RMB'000
	(Unaudited)	(Audited)
Due from CSRG Group	1,335,205
- Trade receivables	1,015,057
- Prepayments and other receivables	324	1,149
Due to CSRG Group
- Trade payables and payables for fixed assets and	38,395
construction-in-progress	32,688
- Other payables	34,071	35,851

As at 30 June 2019, all the balances maintained with CSRG Group were unsecured, non-interest bearing and were repayable on demand.

17. Subsequent events

Save as already disclosed in the notes to the Financial Information, the Group had no other significant subsequent event.

075    Interim report

Chapter 11

Documents Available for Inspection

Documents Available for Inspection

1. Financial statements signed and stamped by the legal representative, person in charge of accounting affairs and responsible person of accounting firm;
2. All the original of files and announcements disclosed in China Securities Journal, Securities Times, Shanghai Securities News and Securities Daily during the reporting period;
3. Interim reports published on the Hong Kong securities market.

The documents are placed at the Secretariat to the Board of the Company.

Chairman of the Board: Wu Yong

Date of Approval from the Board: 22 August 2019

076    Interim report

By Order of the Board

Guangshen Raiway Company Limited

Guo Xiangdong

Company Secretary

Shenzhen, the PRC, 22 August 2019

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

Executive Directors

Wu Yong

Hu Lingling

Luo Qing

Non-executive Directors

Guo Ji'an

Yu Zhiming

Chen Xiaomei

Independent Non-executive Directors

Chen Song

Jia Jianmin

Wang Yunting