Stock Code: 000530; 200530 Short Form of the Stock: Daleng Gufen; Daleng B; No: 2017-016
Dalian Refrigeration Co., Ltd.
2016 Annual Report Summary
§1 Important Notes
This summary is extracted from the original of the annual report. For more information, the investors are recommended to refer to the original.
Note to the “Non-standardized Opinion”
□Applicable√Inapplicable
The profit distribution proposal
√Applicable□Inapplicable
Transfer the capital reserve to increase capital stock
√Applicable□Inapplicable
The profit distribution proposal reviewed and adopted at this Board meeting of the Company is: based on the total share capital of the Company of 611,776,558 shares, pay to all shareholders the cash dividend of 1 yuan (inclusive the tax) and transfer to all shareholders the capital reserve to increase capital stock, 4 shares for every 10 shares.
Company Profile
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|Short form of the stock||DALENG GUFEN; DALENG-B||
|Stock code||000530; 200530||
|Listed stock exchange||Shenzhen Stock Exchange||
|Contact persons|Secretary of the Board of Directors||Authorized representative in charge ofsecurities affairs|
|Name|Song Wenbao||Du Yu|
|Contact address|DALENG GUFEN Securities﹠Legal Affairs No.106, Liaohe EastRoad, Dalian Economic andTechnological Development Zone||DALENG GUFEN Securities﹠LegalAffairsNo.106, Liaohe East Road,Dalian Economic and TechnologicalDevelopment Zone|
|Telephone|0411-87968130||0411-87968822|
|Fax|0411-87968125||0411-87968125|
|E-mail|000530@bingshan.com||000530@bingshan.com|

§2 TheCompany’s Main business during the reporting period
The Company, as the largest industrial refrigeration equipment production enterprise in China, is
committed to developing the business of industrial refrigeration, food freezing and cold storage,
central and commercial air-conditioning, refrigeration components and engineering service, have
covered the key areas of the refrigeration industrial chain and forged the most complete cold and
hot industrial chain in China.
§3 Summary of Accounting Data and Financial Indexes
3.1 Main accounting data (Unit: RMB Yuan)
Did the Company retroactively adjust or restate the accounting data of previous years due to
change in the accounting policy and correction of accounting mistakes?
□Applicable√Inapplicable
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|-|-|-|-|-|
||||Increase/decrease compared||
||2016|2015||2014|
||||with previous year||
|Operating revenue|1,779,499,226.64|1,607,518,439.61|10.70%|1,425,715,596.96|
|Net profit attributable to shareholders of|178,632,660.24|129,947,307.39|||
||||37.47%|115,439,722.39|
|listed companies|||||
|Net profit attributable to the|||||
|shareholders of listed companies after|||||
||145,227,418.21|126,122,809.25|15.15%|105,435,245.61|
|the deduction of non-recurring profit|||||
|and loss|||||
|Net cash flow from operating activities|-7,706,320.22|-50,568,474.38|84.75%|28,495,772.47|
|Basic earning per share|0.31|0.24|29.17%|0.22|
|Diluted earnings per share|0.31|0.24|29.17%|0.22|
|Weighted average return on net asset|||decrease 0.51 percentage||
||5.87%|6.38%||5.98%|
|yield|||point||
||||Increase/decrease compared|At the end of|
||At the end of 2016|At the end of 2015|||
||||with previous year|2014|
|Total assets|4,983,511,574.26|4,082,499,864.42|22.07%|3,053,930,248.25|
|Owner's equity attributable to|3,247,797,768.92|2,647,609,091.41|||
||||22.67%|1,967,027,256.13|
|shareholders of listed companies|||||

3.2 The quarter main financial indicators (Unit: RMB Yuan)
||||||
|-|-|-|-|-|
||The first quarter|The second quarter|The third quarter|The fourth quarter|
|Operating revenue|400,592,922.66|379,326,941.37|471,165,234.36|528,414,128.25|
|Net profit attributable to shareholders of|||||
||25,527,518.21|41,959,768.63|64,264,334.88|46,881,038.52|
|listed companies|||||
|Net profit attributable to the shareholders|||||
|of listed companies after the deduction of|25,497,476.68|36,412,981.35|38,183,454.01|45,133,506.17|
|non-recurring profit and loss|||||
|Net cash flow from operating activities|-89,736,770.51|46,524,738.11|-15,216,952.20|50,722,664.38|

§4 Share Capital and Shareholders' Information
4.1 Statement of shares held by the top ten shareholders
||||||||||
|-|-|-|-|-|-|-|-|-|
|Total number of shareholders in the|||Total number of shareholders as of the 5th trading day||||||
||36,246||||||41,152||
|reporting period|||before disclosure of the annual report||||||
|Shareholding of top ten shareholders|||||||||
|||||||Number of||Number of|
|||||||shares with||pledged|
|Name||Nature||Proportion|Total number||||
|||||||sale||shares or|
|||||||restriction||shares frozen|
|Dalian Bingshan Group Co., Ltd.||Domesticnon-state-owned legalperson||19.96%|122,083,524|0||0|
|Sanyo Electric Co., Ltd.||Overseas legal person||8.58%|52,502,250|0||0|
|Industrial Securities Golden Kylin No. 2 Collective Asset Management Plan||Others||2.79%|17,063,257|7,280,081||0|
|Zheshang Juchao New thinking hybrid securitiesinvestment fund||Others||1.81%|11,044,457|0||0|
|National Social Security Funds 104 Portfolio||Others||1.32%|8,100,000|5,864,510||0|
|BCM-Changxin quantitative hybrid securitiesinvestment fund||Others||1.21%|7,416,235|0||0|
|National Social Security Funds 503 Portfolio||Others||0.96%|5,864,510|5,864,510||0|
|Caitong Capital Kunze No. 2 SecuritiesvInestment Fund||Others||0.96%|5,864,509|5,864,509||0|
|Shenzhen B & D Capital Fengnian Jinjia No. 1Fund||Others||0.96%|5,864,509|5,864,509||0|
|Zheshang Juchao industry grow hybrid securitiesinvestment fund||Others||0.77%|4,701,826|0||0|
|||Dalian Bingshan Group Co., Ltd. had the association relationship with SanyoElectric Co., Ltd. among the above shareholders. Sanyo Electric Co., Ltd. holds26.6% of Dalian Bingshan Group Co., Ltd.'s equity.|||||||
|Notes to the associated relationship and uniform|||||||||
|actions of the above shareholders|||||||||

4.2 Particulars about controlling shareholders and actual controller of the Company
100% 100%
22.2% 4.4% 13.3% 13.3% 20.2% 26.6% Dalian Bingshan Group Co., Ltd.
19.96%
Dalian Refrigeration Co., Ltd.
§5 Management discussion and analysis
5.1 Business review for 2016
In 2016, based on operation policy of “leading innovation and creating value”, and theme as “innovation, improvement and enhancement”, the Company kept a firm grasp on innovation-driven and industry-finance combination, operation-oriented, under the help of capital operation, created an industry development mode, accelerated research on technologies, strengthen plans of removal and reconstructed, speed up capital resource integration and foundational management improvement, enhanced competitive power and operation efficiency, strived to achieve main operation target and made it growth on a favorable way in the future.
In 2016, the Company realized operating income of RMB 1,779.5 million, representing98.86% of the annual plan of RMB 1,800 million and a year-on-year increase of10.70%; realized total profit of RMB 188.18 million, representing121.41% of the annual plan of RMB 155 million and a year-on-year increase of38.42%.
The Company positively advanced the application and promotion of new products and technologies during reporting period. Petrochemical screw compressor, CO helical lobe 2
compressor, falling-film semi-closed water cooled screw chiller and CO evaporator condenser
2
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Refrigeration
Sanyo Electric Co., Ltd.
have been designed and commercialized. TheR&D and application project of pressure pre-cooling and ice-temperature fresh-keeping technology passed the sci-tech achievements evaluation organized by Chinese Association of Refrigeration. 863projects—high-capacity cold water cooling, quick freezing and smart fish processing system through the review from technical expert group of MOST(Ministry of Science and Technology). Marine screw compressor was identified by prototype of new-products and new-technology.
In reporting period, the Company proceeded with the removal and reconstruct in an orderly manner. The private placement was implemented successfully, which guaranteed the capital needs of removal and reconstruct. The technical layout and plans in new plants had been optimized pursuit to the intelligent manufacturing plan. The intelligent construction of new plant was implemented smoothly.
Capital resource integration was performed actively in reporting period. Purchased70% shares of Sanyo Meica for improving the intelligent standards of the products by changed it to be a wholly-owned subsidiary from associated enterprise; acquired5% shares of Bingshan Ryosetsu and capital increment for creating a manufacturing base of cryogenic quick freezers by changed it to be a wholly-owned subsidiary from controlling subsidiary; setting up Panasonic Appliances Refrigeration for clients in aspect of solving the fluorine cold-chain system with purpose of meeting the rapidly growth needs of low-temperature logistics market in China; invested in Fuji Bingshan for facing the market opportunity of growing vending machine in China by improved capacity up to 100,000 sets per year from 50,000 sets per year so far.
On smooth unlock for the first stock incentive plan basis, the Company promoted the second equity incentive plan, and the technical backbone and sales backbone were included in the incentive plans, further to extend coverage for improving the growth incentive and favorable potential development of the Company.
In reporting period, ORC screw expander units and reek screw expander units of the subsidiary–Wuhan New World Refrigeration are in the series promotion stage; the first two-stage screw pressure energy power of the natural gas pipeline network and cold energy recovery system had started up successfully in Fushimen Station, Quzhou, Zhejiang, and successfully passed the 72-hour industrial commissioning acceptance; high-pressure screw compressor Ammonia high-temperature heat pump units and low-pressure screw blower finished the prototype production; the model points of new products have completed the area layout in China basically, operation venue from new products are growth dramatically, the strategy transition was resolutely implemented.
Subsidiary–Bingshan Engineering increased capital and upgrade the qualification in reporting period, actively created new marketing business mode and focus on promoting the integrated solutions, thus orders have a huge growth on a y-o-y basis. Solutions for the large-low-speed wind tunnel, agriculturalproduct’s cold chain, super-low temperature cold storage and air management system of new energy are recognized by the market. Bingshan Engineering successfully wan the bidding of largest frozen beer station project, the monomer cold storage refrigeration system
project- the most cold chain logistic project, at the same time, the project promotes the new products and new operational types of projects as centrifuge, CO cascade system, cast steel 2
compressor, electric heating reform and valley electricity energy-storage are being implemented.
Subsidiary–BingshanService’s ERP system has officially launched in reporting period, remote monitoring users grew rapidly, service standards were improved efficiently, the service industry exploit in a order way. Accessories income continued to growth, and the remote monitoring on-line broke through 100.
Subsidiary–Bingshan Guardian optimized the internet of cloud management platform and intelligent plant energy management system in reporting period, developed many new products of intelligent controller of the internet, further to strength the leading position in technology within the field.
Subsidiary–Bingshan Air-conditioner started with the clients of medical and auto industry AC, got to the root of environmental needs, actively participated in relevant project with air treatment concerned. The sales revenue from new field and new products of VOCs waste gas treatment and new energy air management system were presenting more than30%, which made a key role in promoting the business targets.
The associatedcompany–Panasonic Compressor successfully developed the market in rail transit AC, the sales of horizontal scroll compressor for electric passenger cars use were enlarging continually based on an advance technology. Accumulative sales of horizontal scroll compressor have broken 100,000 sets, and became the new efficiency growth point. Aggressively expanded into overseas market with a good achievements, India and North America in particular. CompletedR&D for E-scroll compressor, and put them into production, in field of household AC, officially transformed and upgraded from B products to E products. Participated in national standards setting of the AC compressor for electric vehicles, and honored the second prize of modern management achievement for national enterprise management.
The associatedcompany–Panasonic Cold Chain aggressively expanded into the Blue Ocean market complying with the requirements change. Created high-end commercial merchandise of new retail model with Charoen Pokphand Warehouse Club. Eyed on the growth development of community fresh supermarket and convenience store, the company entered into new clients with C-Store, CITIC Guoan and Shanxi Tang Jiu in a row. The bulk ultra-cold storage freezer MDF-682– independent research and development, has officially offline. Operating temperature achieved-86℃, the core products in healing domain, the biological medicine entered into a rapidly growth. Industrialization of the inherent market service has steady developed, and signed the Qualify for Maintenance Agreement with Wal-Mart, Carrefour and Metro.
The single largest distributed energy project- CCHP in Harbin Airport was successfully landed by the associated company- Panasonic Refrigeration in reporting period, made a better integrated solutions for the clients. The performance test result for self-development direct combustion grade 1 unit of energy efficiency has reached the standard, with better cost performance, leading in
industry and more strength competition in market.‘Refrigeration technique of circulative ammonia water-heat source”, which took the lead in research& development, honored the first prize ofS&T innovation and creation of the SecondChina’s Coking IndustryS&T Conference. Signed a strategic cooperation agreement with SBW and Beijing Gas and Heating Engineering Design Institute , for expanding the distributed energy market vigorously.
The associated company-Panasonic Appliances Refrigeration integrated relevant resources from Panasonic Cold Chain and PanasonicCompressor’s Fluorine cold-chain system effectively in reporting period, improved sales channel, optimized design team, reinforced engineering construction and after-sale services, offered a better integrated solutions of Fluorine cold-chain system for the clients. Relying on technological superiority, Panasonic Appliances Refrigeration succeeded in obtaining the order of Central China Cold FreshPort—the biggest cold storage of garden stuff forced-air pre-cooling apparatus so far.
In reporting period, the associatedcompany–Fuji Bingshan upgraded intelligent products, non-cash payment and remote controlling system becoming the norm, sales broke 30,000 sets and revenue and net profit have a continued favorable growth. By customized solutions, exploited new VIP client-Wahaha, the client base of drinks has expanded. The intelligent white spirit vending machine has completed in development, and entered into the field of white spirit retail. Large food machine and coffee machine started operation in a limited quantity. Body welding automatic line came into use, and the efficiency higher up to100%. Construction of second plant were implemented in a order way, and double capacity has a steady progress.
The associated company-Keinin-Grand Ocean, depending on excellent quality and cost advantage, sales performance created new high again. On base of the rectification completion on line 1 and 2, started the reforming projects of fully automatic unmanned installed spares, stitching, welding and assembly, continued to improve the quality of products.
5.2 Major change or adjustment in the Company's main business in the reporting period
□Applicable√Inapplicable
5.3 Main business structure
√Applicable□ Inapplicable
||||||||
|-|-|-|-|-|-|-|
|||||Increase/decrea|Increase/decreas||
||||Gross|se of operating|e of operating|Increase/decrease of|
|Product name|Operating revenue|Operating profit||revenues on a|profit on a|gross profit on a|
||||profit||||
|||||year-on-year|year-on-year|year-on-year basis|
|||||basis|basis||
|Refrigeration and||||||Decrease 0.63|
|air-conditioning|1,759,247,556.50|1,448,130,516.25|17.68%|10.58%|11.44%||
|||||||percentage points|
|equipment|||||||

 5.4 Is there a need to pay particular attention to the operation of seasonal or cyclical features?
□Applicable√Inapplicable
5.5 Major change in the Company's business revenue, business cost, or net profit attributable to
shareholders of listed companies in the reporting period
□Applicable√Inapplicable
5.6 Face suspension of listing and termination of the listing
□Applicable√Inapplicable
§6 Matters related to financial report
6.1 Change in accounting policies, accounting estimates and accounting methods compared with the financial statements of the previous year
√Applicable□Inapplicable
According to the Provisions of Treatments on Value-Added Tax (Cai Kuai[2016] No.22) issued
from Ministry of Finance, the property tax, land holding tax, stamp tax and vehicle& vessel usage tax, which are reckoned under Administration Expense and operating cost, will list under the item of Taxes and surcharge, for those occurred after 1 May 2016.
6.2 Correction of major accounting mistakes in the reporting period, which should be retroactively restated
□Applicable√Inapplicable
6.3 Explanation on change of consolidation scope in the report period compared with the latest annual report
√Applicable□Inapplicable
This year, there are 3 more entities were included in the scope of consolidation, they are Dalian
New Meica Electrical Technology Co., Ltd, Dalian BingshanP&A Recreation Development
Engineering Co., Ltd., and Shanghai Bingshan Technical Service Co., Ltd, and one entity which is Dalian Bingshan Metal Processing Co., Ltd is excluded at the year end.
The 3rd meeting of the 7th generation of board of directors approved to accept the70% of
shareholding transfer from Dalian New Meica Electrical Technology Co., Ltd, a holding
subsidiary, hence, Dalian New Meica Electrical Technology Co., Ltd, has become the fully owned subsidiary after transfer. The transaction stated above has been completed by 31st December 2016. Hence, the Company holds100% shareholding of Dalian New Meica Electrical Technology Co.,
Ltd when preparing the consolidated statements.
At the 5th meeting of the 7th generation of board of directors, the company and Hong KongP&A
Water Project Co., Ltd both respectively transferred50% shareholdings of Dalian BingshanP&A
Recreation Development Engineering Co., Ltd. to the fully owned subsidiary, Dalian Bingshan
Group Engineering Co., Ltd. After that, the company would not hold any shares of Dalian
Bingshan Group Engineering Co., Ltd any longer, and the fully owned subsidiary, Dalian
Bingshan Group Engineering Co., Ltd would have100% shareholdings of Dalian BingshanP&A
Recreation Development Engineering Co., Ltd.. The transactions stated above have been
completed by 31st, December 2016.
The board meeting of Dalian Bingshan Group Engineering Co., Ltd, a subsidiary of the company,
approved Dalian Bingshan Group Engineering Co., Ltd and Shanghai QingNeng Cold Chain
Equipment Co., Ltd jointly invested and constructed Shanghai Bingshan Technical Service Co.,
Ltd. Dalian Bingshan Group Engineering Co., Ltd invested 5,100,000Yuan, and held51%
shareholding. Shanghai Bingshan Technical Service Co., Ltd has been formally operated by 31st
December 2016.The 15th meeting of the 6th generation of board approved that Dalian Bingshan
Ryosetsu Quick Freezing Equipment Co.,Ltd., a holding subsidiary, acquired Dalian Bingshan
Metal Processing Co., Ltd which is a fully owned subsidiary. After the merger, Dalian Bingshan
Quick Freezing Equipment Co., Ltd would be the survival company, The transaction stated above
has completed by 31st December 2016.
6.4 Explanation of the Board of Directors to the “Non-standardized Opinion”
□Applicable√Inapplicable
Board of Directors of Dalian Refrigeration Co., Ltd.
April 22, 2017