ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. Interim Report 2019 (Summary) Stock Code: 000029, 200029 Stock Name: SPG, SPG-B Announcement No. 2019-059 SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE& PROPERTIES (GROUP) CO., LTD.
INTERIM REPORT 2019 (SUMMARY)
Part I Important Notes
This Summary is based on the full text of the 2019 Interim Report of ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. (together with its consolidated subsidiaries, the “Company”, except where the context otherwise requires). In order for a full understanding of theCompany’s operating results, financial condition and future development plans, investors should carefully read the aforesaid full text, which has been disclosed together with this Summary on the media designated by the China Securities Regulatory Commission (the “CSRC”).
Objections raised by any of the directors, supervisors or senior management against any contents in this Report or its summary:
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|Name|Office title|Objection and explanation of why|

 Statement of objection:
Except for the following directors, all the other directors attended in person the Board meeting for the review of this Report and its summary.
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|-|-|-|-|
|||Reason for not attending||
|Name|Office title||Proxy|
|||meeting in person||

Independentauditor’s modified opinion:
□ Applicable√ Not applicable
Board-approved interim cash and/or stock dividend plan for ordinary shareholders:
□ Applicable√ Not applicable
The Company has no interim dividend plan, either in the form of cash or stock.
Board-approved interim cash and/or stock dividend plan for preferred shareholders:
□ Applicable√ Not applicable
This Report and its summary have been prepared in both Chinese and English. Should there be any discrepancies or misunderstandings between the two versions, the Chinese versions shall prevail.
Part II Key Corporate Information
1. Stock Profile
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|Stock name|SPG, SPG-B|Stock code|000029, 200029|

ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. Interim Report 2019 (Summary)
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|Stock exchange for stock listing|Shenzhen Stock Exchange||
|Contact information|Board Secretary|Securities Representative|
|Name|Tang Xiaoping|Luo Yi|
||47/F, SPG Plaza, Renmin South Road,Shenzhen, Guangdong, P.R.China|47/F, SPG Plaza, Renmin South Road,Shenzhen, Guangdong, P.R.China|
|Office address|||
|Tel.|（86 755）82293000-4638|（86 755）82293000-4715|
|E-mail address|tangxiaoping0086@126.com|spg@163.net|

2. Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes√ No
|||||
|-|-|-|-|
||H1 2019|H1 2018|Change (%)|
|Operating revenue (RMB)|1,251,337,802.57|1,317,541,631.35|-5.02%|
|Net profit attributable to the listed|333,155,843.41|329,066,084.53||
||||1.24%|
|company’s shareholders (RMB)||||
|Net profit attributable to the listed||||
|company’s shareholders before exceptional|322,865,954.53|329,143,873.10|-1.91%|
|gains and losses (RMB)||||
|Net cash generated from/used in operating|685,675,245.10|594,728,129.67||
||||15.29%|
|activities (RMB)||||
|Basic earnings per share (RMB/share)|0.3293|0.3253|1.23%|
|Diluted earnings per share (RMB/share)|0.3293|0.3253|1.23%|
|Weighted average return on equity (%)|9.81%|11.00%|-1.19%|
||30 June 2019|31 December 2018|Change (%)|
|Total assets (RMB)|5,069,809,256.04|4,665,891,514.25|8.66%|
|Equity attributable to the listed company’s|3,463,168,724.16|3,332,259,641.39||
||||3.93%|
|shareholders (RMB)||||

3. Shareholders and Their Holdings as at 30 June 2019
Unit: share
||||||||||
|-|-|-|-|-|-|-|-|-|
|||||||Number of preferred|||
|Number of ordinary shareholders|||76,443|||shareholders with resumed|0||
|||||||voting rights (if any)|||
|Top 10 shareholders|||||||||
|Name of|Nature of|Shareholding||Number of|||Shares in pledge or frozen||
||||||Restricted shares||||
|shareholder|shareholder|percentage||shares|||Status|Shares|
|ShenzhenInvestmentHoldings Co.,Ltd|State-ownedlegal person|63.55%||642,884,262|||||
|Shandong GoldFinancialHolding CapitalManagementCo., Ltd. －Shandong GoldFinancialHoldingSustaining Fund|Domesticnon-state-owned legal person|1.02%||10,300,000|||||

ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. Interim Report 2019 (Summary)
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|-|-|-|-|
|1||||
|Lu Zhigao|Domesticnatural person|0.32%|3,246,949|
|Tan Shiqing|Domesticnatural person|0.13%|1,286,701|
|Yang Shuilian|Domesticnatural person|0.13%|1,273,700|
|Yang Jianxiong|Domesticnatural person|0.12%|1,255,750|
|Central HuijinAssetManagementCo., Ltd.|State-ownedlegal person|0.12%|1,165,500|
|Peng Wei|Domesticnatural person|0.11%|1,129,082|
|Wu Haoyuan|Foreign naturalperson|0.11%|1,109,300|
|Guotai JunanSecurities(Hong Kong)Limited|Foreign legalperson|0.10%|1,015,683|
|Related or acting-in-concert||The Company has found no related parties or acting-in-concert parties as defined in the||
|parties among the shareholders||Administrative Measures for Shareholding Changes in Listed Companies among the||
|above||shareholders above.||
|||The fourth shareholder holds all his shares in the Company in his accounts of collateral securities||
|Shareholders involved in||||
|||for margin trading. And the third shareholder holds some of his shares in the Company in such||
|securities margin trading (if any)||||
|||accounts.||

4. Change of the Controlling Shareholder or the Actual Controller in the Reporting Period
Change of the controlling shareholder in the Reporting Period:
□ Applicable√ Not applicable
The controlling shareholder remained the same in the Reporting Period.
Change of the actual controller in the Reporting Period:
□ Applicable√ Not applicable
The actual controller remained the same in the Reporting Period.
5. Number of Preferred Shareholders and Shareholdings of Top 10 of Them
□ Applicable√ Not applicable
No preferred shareholders in the Reporting Period.
6. Corporate bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were outstanding before the date of this
Report’s approval or were due but could not be redeemed in full?
No.
ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. Interim Report 2019 (Summary) Part III Operating Performance Discussion and Analysis
1. Business Overview of the Reporting Period
Is the Company subject to any industry-specific disclosure requirements?
No.
(I) Operating Results of the Reporting Period
In face of the complicated and changeable economic conditions at home and abroad in 2019,China’s economy continued to see progress amid overall stability. Major macro-economic indicators remained at reasonable levels, the supply-side structural reform carried forward, and high-quality development promotion continued. Regarding the domestic real estate market, it was still under great pressure due to the restrictive measures. Under such circumstances, in addition to carrying forward its major assets restructuring programme, the Company adhered to the thinking of “Carefully Draw up Development Strategies, Particularly Focus on Core Business, Strictly Control Costs and Continuously Improve Management Capability” and put greater efforts into promoting project construction and marketing, so as to achieve continual and stable development.
In the Reporting Period, the Company made a concerted effort to steadily promote project construction. As a result, for this period, the Company achieved operating revenue of RMB1,251 million, down5.02% compared to the same period of last year; a profit before taxation of RMB446 million, representing a year-on-year growth of1.28%; and a net profit attributable to the listedcompany’s shareholders of RMB333 million, increasing1.24% from a year earlier. As at 30 June 2019, equity attributable to the listedcompany’s shareholders amounted to RMB3,463 million, a3.93% rise compared to the end of last year.
1. Focused on residential property development, the Company has been building a professional and high-quality development team, as well as improving the management mechanism and processes for project development. As a result, the operational capability in the core business of real estate keeps increasing, along with the core competitiveness. During the Reporting Period, the key projects of the Company were mostly located in Shenzhen and Shantou. The Company paid close attention to product quality and progress, and adjusted marketing strategies in a timely manner. As a result, project development and sales progress basically met expectations, and the core business was in good order and health.
2. TheCompany’s main real estate projects under construction or available for sale during the Reporting Period included the Shenzhen-based Chuanqi Jingyuan, Cuilinyuan and Chuanqi Donghu Mingyuan projects, as well as the Shantou-located Tianyuewan project, etc., with details as follows:
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|||||The||||||
|||||||Floor area||Expected total|Accumulated|
|Project|Locati|Usage|Status|Comp|Site area（㎡）|with plot ratio|Completed|investment|investment|
||on|||any’s|||floor are（a ㎡）|||
|||||stake||（㎡）||(RMB’0,000)|(RMB’0,000)|
|ChuanqiJingyuan|Shenzhen|Rental|Available forsale|49%|4,243.34|43,156|43,156|24,865|20,023|
|Cuilinyuan|Shenzhen|Residential|Available forsale|100%|16,424.29|60,450|60,450|57,000|51,634|
|TianyuewanPhase I|Shantou|Residential|Available forsale|100%|31,167.50|153,470|153,470|79,801|68,983|

ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. Interim Report 2019 (Summary)
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|TianyuewanPhase II|Shantou|Residential|Underconstruction|100%|33,361.70|127,661|0|65,485|20,802|
|ChuanqiDonghuMingyuan|Shenzhen|Residential|Underconstruction|100%|5,889.70|34,073|0|51,000|36,723|

3. Land bank for future development by the end of the Reporting Period:
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|Project|Location|Land area（㎡）|Floor area with plot ratio （㎡）|
|Xinfeng Building|Shantou|5,920|26,640|
|Total||5,920|26,640|

 Note: The Company's real estate projects do not involve primary land development.
(II) Operation Review for H1 2019
1. TheCompany’s fundamentals remain positive with sufficient cash flows and a healthy financial condition. In late May 2019, the Company implemented its final cash dividend plan of 2018. 2. The major property developments proceed smoothly. The Company has further improved the development and management system, attached importance to construction safety and tightened cost control. During the Reporting Period, the overall progress of theCompany’s property developments was in line with the schedule. In Shenzhen, the Cuilinyuan project has finished the initial registration; the Chuanqi Jingyuan project has successfully completed fine decoration; and the Chuanqi Donghu Mingyuan project has wrapped up construction and is going through acceptance. In Shantou, the Tianyuewan Phase II project has completed the pile foundation and the pit support structure and is progressing as scheduled.
3. Property sales were generally good. The Company kept a close eye on policy and market dynamics, and adjusted marketing strategies accordingly in a timely manner. Sales by project were basically satisfying. The Chuanqi Jingyuan project has been almost sold out; the Chuanqi Donghu Mingyuan project has been sold approximately10%; the Cuilinyuan project has been sold around80%; and the Tianyuewan Phase I project has seen about35% of its residential units sold.
(1) Sales of major real estate projects carried forward to the Reporting Period:
Unit:RMB’0,000
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|-|-|-|-|-|-|
|||Operating|||Gross profit margin|
||Location||Cost of sales|Gross profit margin||
|||revenue|||(%)|
|Chuanqi Jingyuan|Shenzhen|79,580|11,268|68,312|85.84|
|Cuilinyuan|Shenzhen|11,185|3,078|8,107|72.48|
|Tianyuewan PhaseI|Shenzhen|6,783|5,348|1,435|21.16|
|Yuejing Dongfang|Shantou|182|135|47|25.82|
|Jinyedao|Shantou|599|234|365|60.93|
|Total||98,329|20,063|78,266|79.60|

 (2) Real Estate sales during the Reporting Period:
Unit: square meters
|||||||||
|-|-|-|-|-|-|-|-|
||||||Floor area|||
||||The|||Area actually||
|No.|Project|Time of opening|Company’s|Location|available for|sold in Current|Settled area in|
|||for sale|||sale at||Current Period|
||||interest||year-beginning|Period||
|1|Chuanqi|October 2018|49%|Shenzhen|18,011|16,125|12,006|
||Jingyuan|||||||
|2|Cuilinyuan|June 2017|100%||12,733|4,026|3,256|
|||||Shenzhen||||
|3|Chuanqi|December 2018|100%|Shenzhen|32,762|2,772||
||Donghu|||||||
||Mingyuan|||||||

ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. Interim Report 2019 (Summary)
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|4|Tianyuewan|October 2016|100%|Shantou|122,085|11,566|12,203|
||Phase I|||||||
|5|The remaining|December 2013|100%|Shantou|944||211|
||units of Yuejing|||||||
||Dongfang|||||||
|6|The remaining|July 1996|100%|Shantou|3,408|916|526|
||units of|||||||
||Jinyedao|||||||
|Total|||||189,943|35,405|28,202|

 4. Corporate management keeps improving and internal potentials are tapped to help improve corporate performance. Subsidiaries have enhanced strategic synergy with the core business of the Company and generally achieved over half of the expected profit in H1 2019. Meanwhile, the purchase of structured deposits at bank with idle funds has effectively increased the efficiency of capital utilization. Moreover, the six expenses under intense monitoring went down9.2% in H1 2019 compared to a year ago.
5. Property rental is stable with steadily rising rental prices as well as good occupancy rates and rent collection rates. The major properties for rental are as follows:
Unit: square meters
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|-|-|-|-|-|-|-|-|
|||||Occupancy|||The Company’s|
|Location|Name of building|Rentable area|Rented area||Usage|Land ownership||
|||||rate|||interest|
|Shenzhen|Real EstateMansion|3,413.88|3,413.88|100%|Commercial|T he Company|100%|
|Shenzhen|North Block ofGuoshangMansion|4,819.71|4,819.71|100%|Commercial|The Company|100%|
|Shenzhen|Petrel Building|22,475.47|22,475.47|100%|Commercial|T he Company|100%|
|Shenzhen|SPG Plaza|61,005.94|49,750.84|81.55%|Office|The Company|100%|
||SPG PlazaPodium|19,903.30|19,825.30|99.61%|Commercial|T he Company|100%|
|Shenzhen|Wenjin Garden|3,531.60|3,531.60|100%|Commercial|The Company|100%|
|Total||115,159.90|103,816.80|||||

6. The assets restructuring programme has been carried forward.
TheCompany’s major assets restructuring plan is subject to further communications and improvements with the regulators. Due diligence material update, additional audit and assessment, etc. are underway.
(III) Risks Facing the Company and Countermeasures
1. Risks Facing the Company:
(1) Risks from macroeconomic environment. Since this year, Chinese government has been adhering to the general principle of seeking progress while maintaining stability, the domestic economy runs within a reasonable range. However, given that the Sino-US trading dispute is still going on, and that the global economic situation remains complicated and severe, the downward pressure on the economy is difficult to relieve in a short term.
(2) Risks from policy on real estate industry. Against the convening of the
19th
National Congress
of the Communist Party of China, the Chinese government shows a clear attitude that “Houses are
for living in, not for speculating on”. The continuous implementation of real estate macro-control
policy curbspeople’s investment demands at a large degree, and potential customers are
ShenZhen Special Economic Zone Real Estate& Properties (Group) Co., Ltd. Interim Report 2019 (Summary) increasingly taking a wait-and-see attitude, which generates a certain impact on the development and sales of main business of the Company.
(3) Risks from development and operation of main business. The Company does not increase its land reserve, influenced by the major assets restructuring and the land reserve at present is limited. Moreover, there is a lag in the sales progress of Shantou Tianyuewan Phase I.
(4) Potential risks from assets restructuring. The major assets restructuring of the Company is a significant and unprecedented event with complex trading structure for involved in the Shenzhen State-owned Enterprise Reform and with large-scale assets since the underlying assets it plans to purchase are industrial leading assets. Thus, the trading of its shares has been suspended for almost three years since its start of trading on 14 September 2016. At present, matters such as the renewal of diligence materials in restructuring and supplementary audit as well as evaluation are carried out simultaneously. For the uncertainty of related events, investors are reminded of the investment risks.
2. Countermeasures
Firstly, the Company will unremittingly pay attention to international and domestic macroeconomic situation and the industrial trend, and then formulate flexible coping strategies.
Secondly, the Company will further strengthen its ability to develop main business, raise its management level and make efforts to reinforce the marketing of projects so as to stabilize the fundamental of the Company.
Thirdly, the Company will increase its land reserve timely and in an appropriate way to maintain the sustainable development of the Company in the future.
Fourthly, the Company will enhance the communication with regulators together with parties involved in the restructuring and make full efforts to promote the process of major assets restructuring.
2. Matters Related to Financial Reporting
(1) Changes to Accounting Policies, Accounting Estimates or Measurement Methods Compared to the Last Accounting Period
□ Applicable√ Not applicable
No such changes.
(2) Retrospective Restatements due to the Correction of Material Accounting Errors in the Reporting Period
□ Applicable√ Not applicable
No such cases.
(3) Changes to the Scope of Consolidated Financial Statements Compared to the Last Accounting Period□ Applicable√ Not applicable
No such changes for the Reporting Period.