Net Profit Amounts to RMB 539 Million

Shenzhen Expressway Company Limited (“Shenzhen Expressway”, the “Company”, or the “Group”; HKEx:00548) announces the interim results for the six months ended 30 June 2015 (the “Reporting Period”). For the first half of 2015, Shenzhen Expressway recorded revenue of RMB1.5 billion, net profit of RMB539 million and earnings per share of RMB0.247.

The Group recognised net gains on disposal of assets after tax of the Toll Free Section of Meiguan Expressway of approximately RMB1.1 billion in the first half of 2014, resulting in substantial changes in net profit, earnings per share, and other indicators during the Reporting Period. Excluding this effect, the net profit recorded a YOY decrease of 7%, which was mainly due to a significant YOY decrease in profit from entrusted management service during the Reporting Period.

For the first half of 2015, the Group recorded revenue of RMB1.5 billion, of which toll revenue of RMB1.395 billion, as the main source of revenue of the Group. During the Reporting Period, resulting from the toll adjustment since 1 April 2014, the toll revenue of Meiguan Expressway recorded a YOY decrease of approximately RMB51 million. In Addition, Qinglian Expressway, Yanpai Expressway and Wuhuang Expressway were affected by factors including diversion by road network, leading to a certain degree decrease in toll revenue respectively. Benefited from the organic growth of traffic volume, improvement of road network and maintenance of peripheral road sections, toll revenue of Jihe Expressway continued to achieve double-digit growth. Under the comprehensive influence of factors mentioned above, toll revenue of the Group recorded a YOY decrease of approximately 4.8%. But benefited from the YOY decrease of costs of road maintenance expenses and depreciation and amortisation, operating profit from main business still recorded a certain increase for the Reporting Period.

During the Reporting Period, both the income and cost of entrusted construction management services were significant decrease, which resulted in the YOY decrease in relevant profits. In recent years, the Group has been proactively pushing forward the development of entrusted management service business. With relevant management experience and resources, the Company has achieved a good earnings which became a meaningful auxiliary income in addition to main business. As the management period of the entrusted construction management projects normally lasts for several years, affected by the changes of various factors including the scale of each project, progress of construction during the current period, audit results and settlement of works, relevant management profit during some periods may have a higher level of fluctuation.

The Group’s financial expenses for the Reporting Period recorded a YOY decrease of 32%, which was mainly attributable to the decrease in the Group’s average borrowing scale and the recognition of interest income in respect of the compensation receivables as agreed in Meiguan Expressway Adjustment Agreement. On 14 August 2015, the Group issued RMB900 million medium-term notes with maturity of three years and coupon rate of 3.95%. In the future, the Group will, in accordance with its own actual needs, continue to strengthen the use of financial tools in the capital market, aiming to maintain a reasonable capital structure and reduce the composite capital cost.

During the Reporting Period, the Group continued to actively push forward the development of Guilong Project and successfully proceeded the research and negotiations for the business modes for Outer Ring Expressway, Coastal Project and Meilin Checkpoint Renewal Project. Hereinto, in regard to the Meilin Checkpoint Renewal Project, the Company entered into land transfer agreements as scheduled, and obtained the land use right. The Group is conducting in-depth industry policy research, exploring the method for value realisation and liquidation of the land, as well as promoting the introduction of cooperation parties, so as to realise the commercial value of the project as soon as possible.

The management commented that, the Group will actively respond towards the changes of internal and external environment, pursue the market-oriented and innovation-driven strategy, seise the opportunities of this era to consolidate and strengthen the core business of toll highway and actively explore and fix the direction of the new industry so as to achieve the sustainable development of the Group and reward shareholders.

Appendix I: 2015 Interim Results Highlights

Appendix II: Basic Operating Statistics of Toll Highways during the Reporting Period