Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Stock Code: 200771 Stock ID: Hangqilun B Announcement No. 2017-57 Hangzhou Steam Turbine Co., Ltd.
SEMIANNUAL REPORT 2017
（ ：200771）
Stock Code
August 2017
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Important Remarks, Table of Contents, and Definitions
The Board of Directors, the Supervisory Committee, the directors, the supervisors, and executives of the
Company guarantee that there are no significant omissions, fictitious or misleading statements carried in the Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness of the Report.
Chairman Mr. Zheng Bin, Chief Financial Officer Pu Yangshuo, and the Chief of Accounting Department Mr. Zhao Jiamao hereby declare: the Financial Statement in the report is guaranteed to be truthful and complete. All of the directors attended the board meeting on which this report was examined.
This Report contains prospective descriptions, whichdoesn’t constitute substantial commitment to investors. Investors are requested to be aware of the risks attached to their investment decisions.
The Company will not distribute cash dividend or bonus shares, neither capitalizing of common reserves for the report period.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Table of Contents
I.Important Notice, Table of contents and Definitions
II. Corporate Profile and Key Financial Indicators
III. Business Profile
IV. Performance Discussion and Analysis
V. Important Events
VI. Change of share capital and shareholding of Principal Shareholders
VII. Situation of the Preferred Shares
VIII .Information about Directors, Supervisors and Senior Executives
IX. Corporate Bonds
X. Financial Report
XI. Documents available for inspection
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Definition
||||
|-|-|-|
||Defined||
|Terms to be defined||Definition|
||as||
||Defined||
|Company, the Company||Hangzhou Steam Turbine Co., Ltd.|
||as||
||Defined||
|The Group, Hangqi Group||Hangzhou Steam Turbine Power Group Co., Ltd.|
||as||
||Defined||
|The report period, In the report period||January 1,2017-June 30,2017|
||as||
||Defined|Hangzhou Zhongneng Steam Turbine Power Co., Ltd. – the holding|
|Zhongneng Co.|||
||as|subsidiary of the Company|
||Defined|Hangzhou Steam Turbine Casting Co., Ltd. – the holding subsidiary of|
|Casting Co.|||
||as|the Company|
||Defined|Zhejiang Steam Turbine Packaged Technology Development Co., Ltd.|
|Packaged Tech. Co.|||
||as|– the holding subsidiary of the Company|
||Defined|Hangzhou Steam Turbine Machinery Equipment Co., Ltd. - the holding|
|Machinery Co.|||
||as|subsidiary of the Company|
||Defined|Hangzhou Steam Turbine Auxiliary Machinery Co., Ltd. - the holding|
|Auxiliary Machine Co.|||
||as|subsidiary of the Company|
||Defined|Zhejiang Turbine Import & Export Co., Ltd. – the holding subsidiary of|
|Turbine Co.|||
||as|the Company|
||Defined|Hangzhou Steam Turbine Heavy Industry Co., Ltd. - the holding|
|Heavy Industry Co.|||
||as|subsidiary of the Company|
||Defined||
|The Board of Directors||The Board of Directors of Hangzhou Steam Turbine Co., Ltd.|
||as||
||Defined||
|The Supervisory Committee||The Board of Directors of Hangzhou Steam Turbine Co., Ltd.|
||as||
||Defined||
|The Shareholders’ Meeting||The Board of Directors of Hangzhou Steam Turbine Co., Ltd.|
||as||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
||Defined||
|RMB, RMB0’000, RMB000’000’000||RMB Yuan, RMB10 thousand Yuan, RMB100 million Yuan|
||as||
||Defined||
|MW|||
|||Unit of power: 1000KW|
||as||
||Defined||
|PLM|||
|||Product life circle management information system|
||as||
||Defined||
|PTA|||
|||Pure Terephthalic Acid|
||as||
|MES|Defined||
|||Product lifecycle management information system|
||as||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 II. Corporate Profile and Key Financial Indicators
1. Company Information
|||||
|-|-|-|-|
|Stock ID|Hangqilun B|Stock Code|200771|
|Stock Exchange Listed|Shenzhen Stock Exchange|||
|Company Name in Chinese|杭州汽轮机股份有限公司|||
|Short form of Company Name in||||
||杭汽轮|||
|Chinese||||
|Name in English(if any)|HANGZHOU STEAM TURBINE CO.,LTD|||
|Abbreviation in English(if any)|HTC|||
|Legal representative:|Zheng Bin|||

2. Contact person and contact manner
||||
|-|-|-|
||Secretary of the Board|Representative of Stock Affairs|
|Name|Wang Gang|Wang Caihua|
|Address|No. 357 Shiqiao Rd. Hangzhou|No. 357 Shiqiao Rd. Hangzhou|
|Tel.|0571-85780198|0571-85780438|
|Fax.|0571-85780433|0571-85780433|
|Email.|wg@htc.cn|wangch@htc.cn|

III. Other info.
1. Contacts
No change to the registered address, office address, postal code, official website, and email address of the Company. For details please find the Annual Report 2016.
2. Information inquiry
None of the official presses, website, and place of enquiry has been changed in the semi report period. For details please find the Annual Report 2016.
IV. Summary of Accounting Data and Financial Index
Are there any retrospective adjustment or restatement of financial information of previous year due to change of accounting policies or correcting of accounting errors?
No
|||||
|-|-|-|-|
||This report term|Same period last year|Increase/decrease (%)|
|Turnover (RMB)|1,663,724,702.26|1,367,423,771.88|21.67%|
|Net profit attributable to shareholders of the|43,995,804.38|-31,252,238.19|240.78%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||
|-|-|-|-|
|listed company (yuan)||||
|Net profit attributable to the shareholders of the||||
|listed company and after deducting of|3,560,218.39|-43,478,314.33|108.19%|
|non-recurring gain/loss(RMB)||||
|Net Cash flow generated by business operation|34,849,647.14|214,699,052.95||
||||-104.80%|
|(RMB)||||
|Basic earnings per share (Yuan/share)|0.06|-0.04|250.00%|
|Diluted earnings per share (Yuan/share)|0.06|-0.04|250.00%|
|Net income on asset, weighted|0.69%|-0.74%|1.43%|
||As at the end of the|||
|||As at the end of last year|YoY+/-（%）|
||reporting period|||
|Gross assets (RMB)|11,111,682,905.80|10,550,899,708.34|5.32%|
|Shareholders’ equity attributable to shareholders|6,410,591,387.20|6,385,346,243.23||
||||0.40%|
|of the listed company（RMB）||||

V.The differences between domestic and international accounting standards
1. Differences between the net profit and net asset in the financial reports prepared under IAS and Chinese Accounting Standard
Not existent
2. Differences between the net profit and net asset in the financial reports prepared under IAS and Chinese Accounting Standard
Not existent
VI. Non-recurring gain/loss items and amounts
In RMB
||||
|-|-|-|
|Items|Amount|Remarks|
|Non-current asset disposal gain/loss(including the write-off part for which|180,553.42||
|assets impairment provision is made)|||
|Govemment subsidies recognized in current gain and loss(excluding those|2,505,237.27||
|closely related to the Company’s business and granted under the state’s|||
|policies)|||
|Gains and losses from change of fair values of held-for-transaction financial|44,784,598.29||
|assets and financial liabilities except for the effective hedge business related|||
|to normal business of the Company, and investment income from disposal of|||
|transactional financial assets and liabilities and financial assets available for|||
|sale|||
|Other non-operating income and expenditure beside for the above items|1,590,730.74||
|Less: Influenced amount of income tax|7,982,642.11||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Amount of influence of minority interests（After tax）|642,891.62||
|Total|40,435,585.99|--|

For theCompany’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses and its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as recurring gains and losses, it is necessary to explain the reason.
None of Non-recurring gain /loss items recorgnized as recurring gain /loss/items as defined by the information disclosure explanatory Announcement No.1- Non–recurring gain/loss in the report period.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 III. Business Profile
Ⅰ.Main Business the Company is Engaged in During the Report Period
Whether the company needs to comply with the disclosure requirements of the particular industry
No
As the leading provider of turbo machinery equipment and relevant service in China, our company is mainly famous for designing and producing rotating turbo machinery like industrial steam turbines and gas turbines. Our company, one of the major companies drafting the industrial standard in Chinese domestic industry of industrial steam turbine, has developed into the biggest base to research, develop and produce industrial steam turbines in China and ranks first among industrial steam turbine producers in terms of the market occupancy. Holding the principle “our products should be based onclients’ demands” as our business mode and characteristic, our company designs and produces in accordance with everyclient’s personal demands so as to meet personalized needs in engineering projects to the utmost. To realize the fast research and development of our products, our company has adopted the advanced modular design technique and, on the other hand, introduces information technique to assist the collaborative production to achieve the resource saving and flexible production. In addition, our company also provides our clients with relevant service such as engineering programs, general engineering contracting, operation and maintenance of our products as well as remote control and so on.
Industrial steam turbines use the steam featuring high temperature and high pressure as their working medium so as to convert the thermal energy into mechanical energy to drive various industrial equipments through the rotating steam turbines. As for different objects driven by industrial steam turbines, the steam turbines could be divided into industrial driving steam turbines and industrial power-generation steam turbines. Mainly driving rotating machines like compressors, air blowers, pumps and squeezers, industrial driving steam turbines, as the core power part in numerous large-scale industrial equipments, are always introduced into some industries like oil refining, chemical engineering, chemical fertilizer, building materials, metallurgy, electric power, light industry and environmental production. The industrial power-generation steam turbines, mainly utilized to drive electric generators and provide thermal energy, are mainly adopted in private stations, regional projects of combined heat and power generation, power generation by recycling waste heat in industrial production, urban waster power plants and gas-steam combined cyclepower stations in various industrial sectors. The gas turbines produced by our company are mainly used by metallurgical industry to recycle the waste heat from the blast furnace exhaust to generate power. The mode of independent sales and cooperative productions is adopted in the sector of gas turbine business. We win our orders by participating in bidding for engineering equipments needed in new or reconstruction projects in domestic large-scale metallurgical industry. Our design for products is provided by technical partner, major parts of our products are systematically produced and purchased in China and some parts are imported overseas. In the report period, our company cooperating with SIEMENS in the field of distributed energy of gas has started our gas turbine business as the purchaser and implementor of integration of the project. Our company provides life-long operation guarantee service for our clients who have purchased our gas turbines, which has brought long-term business cooperation between our company and our clients.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017Ⅱ.Major Changes in Main Assets
1. Major Changes in Main Assets
|||
|-|-|
|Main assets|Major changes|
|Equity assets|No major changes|
|Fixed assets|No major changes|
|Intangible assets|No major changes|
|Construction in process|No major changes|

2. Main Conditions of Overseas Assets
Not applicable
Ⅲ.Analysis On core Competitiveness
Whether the company needs to comply with the disclosure requirements of the particular industry
No
As the largest developing and manufacturing base of industrial steam turbine throughout the country, the Company has been in the territory with years of experiences, which provided obvious advantages from technical research to production, from marketing to customer services.
1. A complete technical innovation system was established. The Company has under its possession of national, provincial, and municipal grade technical centers, a doctorial workstation, and an academician workstation. Close co-operations were carried out with institutions and universities from throughout the country. As the main drafter of national standard on industrial steam turbine, the Company has the newest technical trend under its close observation. The Company is now providing nearly 600 different models of steam turbines to the customers and hold the newest technical system covering the product lines up to 150 MW. Cooperating with SIEMENS in the field of gas turbine, our company has been capable of selecting the model of the combined recycling project of distributed energy. In addition, our company has also been able to finish the independent processing or supporting work whichdoesn’t need to depend on the gas turbine machine.
Secondly ,The advantages of solutions. The modular design of industrial steam turbine and the production pattern featuring parallelization production enable our company to give considerations to the cost, date of delivery andclients’ demands in the process of production in accordance withclients’ personalized designs, thereby making our company capable of advancing with the development trend of individual requirements. Our company has always been devoting to the localization in terms of the gas turbine business so as to achieve the localized one-stop service step by step including the sale, production, installation, debugging, operation, training and after-sale service. Our company has always been striving to provide clients with the complete equipment of gas turbine power station and the efficient total solutions.
Thirdly, the Company has established strategic co-operations with main customers in the country. Further
marketing approaches were carried on by involving itself in thecustomers’ value. A sound and steady image has
been set up in the domestic steam turbine market. In the global market, the Company has acquired multiple
important certifications and has established a primary global recognition.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Fourthly, the Company has its complete service providing system. The Company is not only capable to provide onsite 24-hour service for theCompany’s own products, but also accumulated rich experiences in technical maintenance and reengineering of othermanufacturers’ products.
Fifthly, the Company has cultivated a significant advantage in human resources. Great importance has been attached to construction of work teams with collection of high-end workforce in the areas of research& development, At the same time, our company values the cooperation with universities. “Zhejiang Technical Association for Gas Turbines in Equipment Manufacturing Industry” was officially founded jointly by our company and Zhejiang University and other scientific research institutions to build a new platform for integration of production and research in terms of gas turbine technology.The Company has cultivated a significant advantage in human resources. Great importance has been attached to construction of work teams with collection of high-end workforce in the areas of research& development, designing, technique, testing, and quality control. An excellent workforce provides a sound foundation to lift quality and services.
IV. Performance Discussion and Analysis
I. General
In the first half of 2017, China's economy has maintained a steady and good trend, the manufacturing industry accelerated its pace to enter middle and high-end manufacturing, and the added value of new and high technology industries and equipment manufacturing industry gained a growth year on year. However, the steam turbine industry has been affected by the global energy structure adjustment, the serious excess capacity of the industry and the slowdown in domestic power investment, therefore the profitability of the industry continued to decline. The company had formulated the annual economic work policy of "Advancing strategy, continuous innovation, deeply exploring market, lean management and enhancing the risk-control”, continued to promote the "13th Five-Year" strategy implementation, strengthened the technological innovation to enhance the core competitiveness of the company, actively developed the market to seize more market share and orders, promoted the "lean production" and "integrated management" to improve operating efficiency, strengthened the risk prevention and control in major business areas and adopted a number of practicable measures and strategies, thus realized the operating goal of a turnaround and gained profits.
、
For the report period, For the report period, the Company has realized turnover of RMB 1,663,724,702.26, a increase of21.67%; Buinsess profit of RMB61,982,164.70 , a increase of282.31%,total profit of RMB66,257,223.45, a increase of 327.60, Net profit of RMB59,728,855.88, a increase of327.30%, net profit attributable to owners of the parent company of RMB43,995,804.38, a increase of240.78%.
The main reason for the big increase in net profit attributable to the shareholders of the Company was due to the increase in non-operating income gained from the bonus of Bank of Hangzhou and the sale of the Hangzhou Changti Partnership enterprise and so on during the reporting period and meanwhile the collection situation of the accounts receivable during the reporting period was good and the provision for bad debt was less than the previous accounting period.
Implementation of business plans disclosed in previous periods in this period
1. Promoting the strategy and realizing the goal.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 The company takes "Made in China 2025" as an opportunity to continue to accelerate the transformation and upgrading of the company. The company has been increased the efforts in technological innovation, combining independent innovation with technology introduction, increasing R& D investment and enhancing the company's core competitiveness. The company promoted the business model innovation, and on the basis of consolidating the market status of industrial steam turbine, the company promoted the gas turbine business, expanded services and engineering business and made changes of the status of single product structure. According to the "13th Five-Year" strategic planning and its decomposition implementation scheme, the company carried out the decomposition, implementation, examination and assessment of the annual strategic performance. The company further adjusted the organizational structure of production, further integrated and optimized the internal resources by institutional adjustment, and improved the process efficiency.
In order to ensure the relocation of the factory and promote the smooth implementation of "Heavy machinery construction project of steam turbine" and "Construction of scientific research building", the company set up a special working organization to study and formulate the project construction promotion plan to ensure that the construction and relocation tasks will be completed as planned.
2. Constant innovation and keeping perfecting
The company increased the R& D investment, constantly made technological innovation, promoted the high-quality goods project and carried out the in-depth implementation of application and promotion for the containerization technology research results. On the basis of the achievements realized on the demonstration unit of containerization technology for Yongfeng Paper Industry KWT5501/02, the company carried out the normalization work of excellent project, which formed and formulated the corresponding standard document and operation manual for the whole process of design, process, manufacture and assembly; relying on Dalian Hengli and Zhejiang Petrochemical Traction unit projects, the in-depth implementation of application and promotion for the containerization technology research results was carried out, thus enhanced the company's market competitiveness and soft power. During the reporting period, the Company initiated 8R&D projects and launched 6 projects of new products, including 1 gas turbine project and 3 technical process projects and 2 vane projects. The company has taken "containerization, intelligence, efficiency and light weight" as the technological innovation orientation, and constantly improved the test and application of the new process, and focused on solving common technical problems, such as vibration, bending, valve head fall off and stem damage or fracture, etc, thus enhanced the company's product quality. In the first half of this year, the company was authorized with 3 invention patents and 4 utility model patents. The company was awarded "Standardized good behavior demonstration enterprise" by China Electrical Equipment Industry Association.
During the reporting period, the company cooperated with universities and scientific research units to build a platform for technical exchanges and cooperation. The "Zhejiang Hangzhou Steam Turbine Gas Turbine Machinery Innovation Center", which was led by the company and was appraised by the provincial economic
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 committee and the expert group, had become one of the three innovation centers firstly established in Zhejiang province.
3. Deeply developing the market and actively seizing the orders
During the reporting period, the number of steam turbine contract of the company and the contract amount all increased year-on-year. As the domestic refining industry improved and the private capital entered the field of refining, the company, by virtue of good historical performance and competitive advantages in product manufacturing, pushed the section to have a record new orders, thereinto, the amount of the project contract signed with Dalian Hengli was RMB 555,580,000, which has become the highest amount of a single contract of the company.
Due to the adverse effects of national energy conservation and environmental protection policy planning and the serious overcapacity of the industry, the Company's orders in the traditional-driven product fields such as coal chemical industry, PTA, nitric acid and metallurgy and in the industrial power generation feed pump field decreased obviously.
The company has cooperated with Siemens, and signed the supply contract for distributed energy projects with EPC general contractor-Southwest Power system Design Institute, and such contract included two SGT-8OO gas turbines and the matching turbo-generator unit. This project was the first time that the company has successfully realized the successful cooperation with the domestic power Design Institute on the gas turbine products, which had a great significance.
The company had held the development forum and user forum of efficient and clean energy use, and the company had invited more than 70 users in the industry to enter the forum and had signed the "Strategic Partner Agreement" with the users. The company had rolled out the "going out" strategy, upgraded the Thailand Office-which will play the role of bridgehead in the company's future market development in Southeast Asian market. The company continued to promote the localized management strategy in Iran.
4. Lean management, reducing costs and raising efficiency.
During the reporting period, the company launched the "lean production management". Through the combing of trans-department processes and by the SIPOC analysis of the process such as placing order, planning and implementation, material management and procurement, the company optimized the production process. The company initiated the implementation of the MES manufacturing execution system and took the intelligent manufacturing project as an opportunity to accelerate the demonstration project of intelligent manufacturing and the practice of lean manufacturing.
The company continued to promote the bidding work, and the sales of waste materials, the out sourcing cylinder processing, the cutting fluid and office supplies, the auxiliary materials and so on were put out tender by the company, thus continuously saved thecompany’s production costs.
The company initiated the "Integrated management" project, which implemented the integration of main
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 business processes including the contract management, after-sales service, product research and development, manufacturing and quality control, constructed the end-to-end whole process management from the sales and production to the delivery, improved the marketing system architecture, the production and delivery system framework (including procurement) and the R& D system framework and integrated the enterprise management system.
In the 2017 Hangzhou Enterprise Management Modernization and Innovation Achievement appraisal activities, the "Big data platform project of discrete manufacturing industry construction process " and the "craftsmen and engineers cultivation project to shape "state elite" quality" and other 3 projects were respectively awarded prizes, including 1 gained the first prize, 2 gained the second prize and 2 projects gained the third prize 5. Deepening the risk control and strengthening the management
The company always emphasized the contract execution management. According to the past years contract execution and the new problems occurred in the current market environment, the company sorted out a series of risk points, perfected the company's Internal Control Implementation Rules of steam turbine business and strengthened the contract review. The company has been made the constant follow-up of the execution of signed contracts, paid close attention to the risk control of contract execution quality and extended the risk control work from contract signing stage to contract execution. By establishing and improving the price system, the company carried out the analysis on the costs, profitability and cash flow of the contract products, thus to lay a foundation for the company implementing the goals of product profits and costs control.
The company increased the assessment and incentive for the collection of accounts receivable, improved the daily handling mechanism and the process of accounts receivable, regularly visited customers to know the progress well and properly used the legal means to actively make the collection. The company continuously strengthened the inventory management, actively communicated and made consultations with the unit users who had a long period inventory and carried out the timely and reasonable disposal of inventory.
The company strengthened the management of fund use, perfected the management processes including entrusted wealth management, investment cooperation with the external and guarantees for the external, and strengthened the examination and approval and supervision of the outflow of funds, thus ensured the safety and liquidity of the company's operating funds. The company enhanced the legal risk management, and it combed the process of the main business of the company, identified the legal risk and proposed the measures, thus constructed the company's legal risk management system.
2.Main business analysis
Refer to relevant contents of “1.Summarization” in “Discussion and Analysis of Management”.
Changes in the financial data
In RMB
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||
|-|-|-|-|-|
||||YOY change||
||This report period|Same period last year||Cause change|
||||（%）||
|Operating income|1,663,724,702.26|1,367,423,771.88|21.67%||
||1,192,385,051.48|850,937,906.04||Mainly due to the current sales|
|Operating cost|||40.13%|growth and the decline in overall|
|||||gross in this period.|
|Sale expenses|81,874,015.85|75,867,593.98|7.92%||
|Administrative expenses|354,411,777.81|355,106,918.55|-0.20%||
||7,945,244.29|512,029.17||Mainly due to the depreciation of|
|Financial expenses|||1,451.72%|the dollar caused by the increase in|
|||||exchange losses|
||6,528,367.57|-2,833,931.34||Mainly due to the provision for|
|||||impairment losses arising from the|
|Income tax expenses|||330.36%||
|||||current deferred income tax|
|||||increase.|
|R & D Investment|140,500,456.42|138,018,919.01|1.80%||
||-10,310,355.58|214,699,052.95||Mainly due to the current advance|
|Cash flow generated by business|||||
||||-104.80%|payment for materials to pay the|
|operation, net|||||
|||||cash increased year on year|
||158,091,370.23|-160,303,138.04||Mainly due to the current|
|||||redemption of financial products|
|Net cash flow generated by|||||
||||198.62%||
|investment||||and investment income increased|
|||||year on year|
||-29,043,280.80|-41,830,084.28||Mainly due to the increase in bank|
|Net cash flow generated by financing|||30.57%||
|||||borrowings in the current period|
||115,611,816.42|16,763,311.05||Mainly due to the increase in net|
|Net increasing of cash and cash|||||
||||589.67%|cash flow from investing activities|
|equivalents|||||
|||||in the current period|
|||||Mainly due to the aging of|
|||||accounts receivable increases, the|
|Asset impairment loss|35,378,404.08|125,619,636.17|-71.84%||
|||||corresponding provision for bad|
|||||loans decrease in this period|

Significant changes in the profit structure or profit source of the Company during the reporting period
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Main business composition
In RMB
||||||||
|-|-|-|-|-|-|-|
|||||||Increase/dec|
||||||Increase/decrea|rease of|
|||||Increase/decrea|||
||||||se of business|gross profit|
||||Gross|se of revenue in|||
||||||cost over the|rate over the|
||Turnover|Operation cost|profit|the same period|||
||||||same period of|same period|
||||rate(%)|of the previous|||
||||||previous year|of the|
|||||year(%)|||
||||||(%)|previous|
|||||||year (%)|
|On Industries|||||||
|Boiler and power machine|||||||
||1,169,308,889.22|844,849,752.79|27.75%|1.10%|14.11%|-8.23%|
|manufacture|||||||
|Casting|40,738,639.98|29,705,385.12|27.08%|51.59%|52.27%|-0.32%|
|Petrochemical and other|||||||
||85,931,536.04|70,075,861.18|18.45%|380.87%|403.54%|-3.67%|
|special machineries|||||||
|Complete set of waste|||||||
||62,921,917.55|51,744,663.80|17.76%|168.05%|185.76%|-5.10%|
|heat power plant|||||||
|Spare parts|206,641,005.65|99,788,527.03|51.71%|56.06%|79.50%|-6.31%|
|Other|98,182,713.82|96,220,861.55|2.00%|857.70%|2,715.47%|-64.67%|
|Subtotal|1,663,724,702.26|1,192,385,051.48|28.33%|21.67%|40.13%|-9.44%|
|On Products|||||||
|Industrial steam turbine|1,169,308,889.22|844,849,752.79|27.75%|1.10%|14.11%|-8.23%|
|Casting products|40,738,639.98|29,705,385.12|27.08%|51.59%|52.27%|-0.32%|
|Auxiliary machinery|85,931,536.04|70,075,861.18|18.45%|380.87%|403.54%|-3.67%|
|Complete set of waste|||||||
||62,921,917.55|51,744,663.80|17.76%|168.05%|185.76%|-5.10%|
|heat power plant|||||||
|Spare parts|206,641,005.65|99,788,527.03|51.71%|56.06%|79.50%|-6.31%|
|Other|98,182,713.82|96,220,861.55|2.00%|857.70%|2,715.47%|-64.67%|
|Subtotal|1,663,724,702.26|1,192,385,051.48|28.33%|21.67%|40.13%|-9.44%|
|District|||||||
|Domestic|1,558,077,382.88|1,109,066,314.68|28.82%|36.79%|60.70%|-10.59%|
|Overseas|105,647,319.38|83,318,736.80|21.14%|-53.75%|-48.18%|-8.48%|
|Subtotal|1,663,724,702.26|1,192,385,051.48|28.33%|21.67%|40.13%|-9.44%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 3.Non-core business analysis
In RMB
||||||
|-|-|-|-|-|
|||Proportion in total||Sustainable|
||Amount||Explanation of cause||
|||profit||(yes or no)|
||||Mainly due to the current period received the Hangzhou||
|Investment income|88,988,506.53|134.31%|Bank dividends and the sale of Long Beach to increase||
||||the formation of income||
||||Mainly due to the current accounts receivable provision||
|Impairment of assets|35,378,404.08|53.40%|||
||||for bad debts increased||
||||Mainly for the received government subsidy and contract||
|Non-operating income|4,554,849.88|6.87%|||
||||compensation||
|Non-operating expenses|279,791.13|0.42%|Mainly due to the payment of the contract compensation||

 IV.Condition of Asset and Liabilities
1.Condition of Asset Causing Significant Change
In RMB
||||||||
|-|-|-|-|-|-|-|
||End of Reporting period||End of same period of last year||||
|||As a|||Change in|Reason for|
||Amount|percentage of|||percentage(%)|significant change|
|||total assets(%)|||||
|Monetary fund|1,055,809,378.48|9.50%|794,767,589.76|9.79%|-0.29%||
|Accounts receivable|1,812,297,540.52|16.31%|1,926,721,216.38|23.74%|-7.43%||
|Inventories|2,052,667,695.99|18.47%|2,235,683,051.12|27.54%|-9.07%||
|Fixed assets|601,473,873.27|5.41%|620,876,192.67|7.65%|-2.24%||
|Construction in|156,071,663.76||||||
|||1.40%|||||
|process|||173,392,716.87|2.14%|-0.74%||
|Short-term loans|197,700,000.00|1.78%|81,250,000.00|1.00%|0.78%||
|Long-term loans|4,900,000.00|0.04%|123,400,000.00|1.52%|-1.48%||

2.Asset and Liabilities Measured by Fair Value
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|Items|Opening balance|Profit/losson|Cumulative|Impairment|Purchased|Sold inthis|Closing balance|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||
|-|-|-|-|-|-|-|-|
|||fair value|fairvalue changes|provided in|in this|reporting||
|||changes in|charged to equity|this|reporting|period||
|||this reporting||Reporting|period|||
|||period||period||||
|Financial assets||||||||
|3.Available-for –sale||||||||
||2,906,013,048.00||-22,193,894.40||||2,883,819,153.60|
|financial assets||||||||
|Subtotal of fainancial||||||||
||2,906,013,048.00||-22,193,894.40||||2,883,819,153.60|
|assets||||||||
|Total of the above|2,906,013,048.00||-22,193,894.40||||2,883,819,153.60|
|Financial Liabilities|0.00||0.00||||0.00|

 Significant changes in the measurement attributes of the main assets in this Reporting Period
No
3. Restricted asset rights as of the end of this Reporting Period
||||
|-|-|-|
|Assets under ownership or use rights|||
|Items|End of Book value|Reason|
|Monetary fund|45,160,002.72|Utilized for issuing bank acceptance bill, L/C and L/G.|
|Bill receivable|22,970,000.00|Utilized for issuing bank acceptance bill|
|Fixed assets|117,870,021.27|Utilized for guaranteeing to obtain bank loan|
|Invisible assets|89,391,343.91|Utilized for pledging to obtain the bank loan and guaranteeing theinvestment loan for China Development Funds|
|Available for salefinancialassets|478,170,000.00|Utilized for guaranteeing the investment loan for China DevelopmentFunds|
|Total|753,561,367.90||

V.Investment situation
1. General
||||
|-|-|-|
||Investments made in same period of lastyear||
|Investments made in the reporting period||+/- %|
|20,000,000.00|0.00|100.00%|

 2.Condition of Acquiring Significant Share Right Investment during the Report Period
Not applicable
3.Situation of the Significant Non-equity Investment Undergoing in the Report Period
Not applicable
4.Investment of Financial Asset
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017（1）Securities investment
Nil.
（2）Investment in Derivatives
Nil.
5.Application of the raised capital
Nil
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 VI.Significant Asset and Right Offering
1.sisposal of material assets
||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||Ratio of|||||||||
|||||Net profit|||||||||||
|||||||the net|||||||||
|||||constributio|||||||||||
|||||||profit||||||Carried out|||
|||||n to the|||||||||||
|||||||contributio||||||on schedule|||
|||||Company|||Pricing|Related||Relevant|||||
||||Transaction|||n to the|||||Relevant|or not if not,|||
|||||form the|Effect of disposal on||basis of|party|Relationship|equity|||||
||Equity interest|Disposal|consideratio|||Company|||||debt fully|the reasons|Disclos||
|Counterparty||||beginning of|the Company||disposal of|transacti|with|interest fully||||Disclosure index|
||disposed of|date|n(RMB’000|||of disposal|||||transferred|and|ure date||
|||||the period|（Notes3）||equity|on or|counterparty|transferred|||||
||||0)|||of equity|||||or not|measures|||
|||||up to the|||interest|not||or not|||||
|||||||interest||||||taken by the|||
|||||disposal|||||||||||
|||||||over total||||||company|||
|||||date(RMB’0|||||||||||
|||||||net|||||||||
|||||000)|||||||||||
|||||||profit(%)|||||||||
||||||It optimized the||Not less|||||||Securities|
||||||company's asset||than the|||||||Times, Shanghai|
||Hangzhou||||||||||||||
|Zhejiang|||||structure, so as to||evaluation|||||||Securities Daily,|
||Changdi Equity||||||||||||||
|Juqing||January|||meet the company's||value||||||January|and|
||Investment||7,368|2,512.16||42.06%||No|Not applicable|Yes|Yes|Yes|||
|Investment||3,2017|||operating capital||confirmed||||||12,2017|http://www.cnin|
||Partnership||||||||||||||
|Co., Ltd.|||||needs. Not having an||by the|||||||fo.com.cn|
||（LP）||||||||||||||
||||||adverse impact on the||state-owne|||||||（Announcemen|
||||||company's production||d assets|||||||t No.:2017-01）|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||
|-|-|
|and operation and|supervisio|
|after the sale, it would|n|
|achieve the|department|
|investment income|'s|
|and have a positive|file-record.|
|impact on the||
|company's financial||
|situation and||
|operating results.||

2.Sales of major equity
Not applicable
Ⅶ.Analysis of the Main Share Holding Companies and Share Participating Companies
Situation of Main Subsidiaries and the Joint-stock Company with over10% net profit influencing to the Company
In RMB
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||Company|Sectors||||||||
|Name|||Industry|Registered capital|Total assets|Net assets|Turnover|Operating profit|Net Profit|
||type|engaged in||||||||
||||Technological|||||||
|||Trade of||||||||
|Zhejiang Steam Turbine Packaged|Subsidiari||development of automatic|51,000,000.00|293,108,271.48|79,946,778.30|95,183,579.66|2,500,388.02|2,530,829.59|
|||packadged||||||||
|Technology Development Co., Ltd.|es||control and instrument|||||||
|||equipment||||||||
||||control|||||||
|Hangzhou Zhongneng Steam|Subsidiari|Manufacturi|Designing and|92,500,000.00|1,059,632,038.81|312,429,362.85|308,881,733.81|-4,118,072.56|-4,491,604.31|
|Turbine Power Co., Ltd.|es|ng|manufacturing of steam|||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||||turbines|||||||
|Hangzhou Steam Turbine Casting|Subsidiari|||22,000,000.00|417,837,013.19|161,338,663.77|144,755,281.64|6,178,211.61|5,817,815.64|
|||Casting|Iron and steel casting|||||||
|Co., Ltd.|es|||||||||
|Hangzhou Steam Turbine|Subsidiari|Manufacturi|Producing and processing|30,000,000.00|210,446,253.12|126,459,272.71|112,615,226.37|28,155,909.53|23,574,045.69|
|Machinery & Equipment Co., Ltd.|es|ng|of steam turbine parts|||||||
|Hangzhou Steam Turbine Auxiliary|Subsidiari|Manufacturi|Manufacturing of steam|80,000,000.00|500,953,839.08|220,771,357.58|214,290,527.44|23,216,468.67|21,921,639.27|
|Machine Co., Ltd.|es|ng|turbine auxiliary machines|||||||
|Zhejiang Turbine Import & Export|Subsidiari|Commerce||20,000,000.00|223,219,438.88|68,235,677.83|37,184,537.75|-773,342.23|-785,188.01|
||||International trade|||||||
|Co., Ltd.|es|& trade||||||||
||||Designing and|||||||
|Hangzhou Steam Turbine Heavy|Subsidiari|Manufacturi||558,966,865.00|584,345,233.13|583,994,018.73|0.00|2,703,229.98|2,067,933.23|
||||manufacturing of steam|||||||
|Industry Co., Ltd.|es|ng||||||||
||||turbines|||||||

Subsidiaries obtained or disposed in the reporting period
||||
|-|-|-|
||Acquisition and disposal of subsidiaries during||
|Name||Influence|
||the reporting period||
|Xinjiang Taifeng Hangzhou Steam turbine complete|||
||Write off|Nil|
|technology development Co., Ltd.|||
|Hangzhou Hangqi Boiler Co., Ltd|Write off|Nil|

VIII．Structured vehicle controlled by the Company
Not applicable
IX. Prediction of business performance for January -September 2017
Estimation of accumulative net profit from the beginning of the year to the end of next report period to be loss probably or the warning of its material change compared with the corresponding period of the last year and explanation of reason.
Not applicable
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 X.Risks facing the Company and countermeasures
1. Market risks
With the decreasing demands for domestic heavy industry investment, the turbine market demands in dive area are under weakboost，More competition and decreasing of gross profit ratio are expectable, and will bring certain pressure to theCompany’s market share and competition. However the Company will do all its best in aspects of technical innovation, market exploring, quality lifting, service upgrading, and value adding, to neutralize the negative impact of the market.
2. Risks of contract fulfilling
With the aggravation of market fluctuations and during the process of contract execution, frequent changes in the contracts, delay and pause in project progress occurred occasionally, which brought huge impacts and influences to theCompany’s internal product implementation process. Meanwhile, market fluctuations also increased the cost and risk for fulfilling theCompany’s contracts. The Company will further strengthen the marketability and improve the speed and level of corporate response to the market to control the risk of contract execution.
（3）Account receivable risks
With declines in operation of partial downstream clients and increases in risk of investment project, risks increased continuously in theCompany’s receivables, of which the average aging tends to increase, which will bring huge impacts to theCompany’s business performance. The Company will implement customer credit management, strengthening the contract signing and controlling the fulfillment risk to intensify the examination for receivables and reduce the adverse effect of overdue account receivables.
（4）Exchange rate risks
Increasing expanding of international purchase and international marketing entails the internal payments to be influenced by exchange rate fluctuations. So, exchange loss will be suffered to some extent. As two-way volatility of the RMB exchange rate is changing sharply, profit or loss on exchange becomes more uncertain. We are attempting to refer to the fluctuation cycle of exchange rate and take appropriate risk-management tools to cut down the loss maximally.
（5）Corporate earnings decline risks
To adapt to the adjustment and changes on the market structure, In 2017,we made considerable alteration on the product mix. Orders received from high-end markets like oil and gas are declined sharply, while low-profit products are substantially ascending, bringing about adverse impact on the overall gross margin. On the other hand, drastic market competition forces the sales price to keep falling. So it is natural that the return on sales is going down. Faced with this phenomenon, more efforts will be paid to upgrade internal management, lower operation cost and enhance operating efficiency, based on which, the risk of profitability downturn will be mitigated.
（6）Technology innovation risks
We will practice the spirit of “13th five-year strategy” to invest more on independent technology of researching gas turbine. Given poor domestic technology, long-range of technology development, enormous funding, uncertainty from development to application and greater risk of technology, we are planning to accelerateR&D building, intensify cooperation with research institutions at home and abroad, launch study of new technology in a scientific and scrupulous manner and reduce the risk of technical innovation.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017（7）Overseas market risks
During implementation of “13th five-year strategy”, we are intending to devote major efforts to “going global” strategy to further open up oversea targeted markets where we will gain more international market shares and improve our influence. However, influenced by geopolitical conflict, volatile political and economic situation and trade barriers in the overseas markets, the strategy of expanding overseas market becomes more uncertain. In view of this, we will reinforce market investigation, validate solutions and figure out development way for the localized business.
V. Important Events
1. Annual General Meeting and ExtraordinaryShareholders’ Meetings in the Reporting Period
1.Annual General Meeting
|||||||
|-|-|-|-|-|-|
|||Investor||||
|Meeting|Type|participation|Convened date|Disclosure date|Index to disclosed information|
|||ratio||||
||||||Resolutions of the Shareholders’|
||Annual||||Annual Meeting|
|2016 Shareholders’ general||||||
||Shareholders’|69.41%|June 30,2017|July 1,2017|2016(Announcement No. 2017-48)|
|meeting||||||
||General Meeting||||released by|
||||||Http://www.cninfo.com.cn|

 2. Preferred stockholders restored voting rights to request to convene ProvisionalShareholders’ Meeting.
Not applicable
II. Proposal for profit distribution and converting capital Reserve into share actual for the reporting period
For the reporting period, the Company plans not to distribute cash dividends or bonus shares or convert capital reserve into share capital.
III. The fulfilled commitments in the reporting period and under-fulfillment commitments by the end of the reporting period made by the company, shareholder, actual controller, acquirer, director, supervisor, senior management personnel and other related parities.
Not existent
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 IV. Particulars about engagement and disengagement of CPAs firm
Whether the semi-annual financial report had been audited?
□Yes√No
V.Explanations given by board of directors and supervisory board regarding “ Modifiedauditor’s” Issued by CPAs firm for the reporting period
Not applicable
VI. Explanations given by Board of Directors regarding “ Modifiedauditor’s Report” Issued for last year Not applicable
VII. Bankruptcy and restructuring
No such cases in the reporting period.
VIII. Legal matters
Signifieant lawsuits or arbitrations
□ Applicable√ Not applicable
No such cases in the reporting period.
Other legal matters
Not applicable
IX. Punishments and rectifications
Not existent
X. Credit conditions of the Company as well as its Controlling shareholder and actual Controller
Not existent
XI.Equity incentive plans, employee stock ownership plans or other incentive measures for employees Not existent
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 XII.Material related transactions
1. Related transactions in connection with daily operation
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||||Whether|||||
|||||||||Trading||||||
||||||||||over the|||||
|||||||||limit||||||
|||||Principle of|||||approve||||Index of|
|||||||Amount of|Ratio in||||Market price|||
|||Type of|Subjects of the related|pricing the|Price of|||approved||Way of|||informatio|
|Related parties|Relationship|||||trade|similar||||of similar|Date of disclosure||
|||trade|transactions|related|trade||||d limited|payment|||n|
|||||||RMB0’000|trades||||trade available|||
|||||transactions||||（RMB’000|||||disclosure|
||||||||||or not|||||
|||||||||0）||||||
||||||||||(Y/N)|||||
|Hangzhou Hangfa||||||||||Bank||||
||Affiliate of the|Purchase of|||Market|5,668.89|6.04%|14,100|No||6000.00|March 18,2017|2017-21|
|Power Generating|||Generators|Fair and just||||||||||
||Group|goods|||price|||||transfer||||
|Equipment Co., Ltd.||||||||||||||
|Total||||--|--|5,668.89|--|14,100|--|--|--|--|--|
|Details of any sales return of a large amount||||No||||||||||
|Give the actual situation in the report period where a forecast had been||||||||||||||
|||||No more than expected||||||||||
|made for the total amounts of routine related-party transactions by type to||||||||||||||
|occur in the current period(if any)||||||||||||||
|Reason for any significant difference between the transaction price and||||||||||||||
|||||Not applicable||||||||||
|the market refernce price (if applicable)||||||||||||||

2. Related-party transactions arising from asset acquisition or sold
No such cases in the reporting period.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 3. Related-party transitions with joint investments
|||||||||
|-|-|-|-|-|-|-|-|
|||||Balance at|Current newly|||
||||Whether has non-business capital|||Current recovery||
|Related|Relationship|Causes||period-begin|added||Interest rate|
||||occupying or not|||（RMB’0000）||
|||||（RMB’0000）|（RMB’0000）|||
||The controlling|Hangzhou Jushi Investment|Services: investment management,|||||
|Hangzhou Steam Turbine Power||||||||
||shareholder of the|Partnership（Limited|industrial investment, investment|190 million|31,493.69|18,990.29|-5.13|
|Group Co., Ltd||||||||
||company|parnership）|advice (except securities, futures)|||||
|Progress of major construction projects under construction (if||||||||
|||Nil||||||
|any)||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 4. Credits and liabilities with related parties
No such cases in the reporting period.
5. Other significant related-party transactions
No such cases in the reporting period.
XIII. Particulars about the non-operating occupation of funds by the Controlling shareholder and other related parties of the Company
The company was not involved in the non-operating occupation of funds by the controlling shareholder and other related parties during the reporting period.
XIV. Significant contracts and execution
1.Entrustments, contracting and leasing
（1）Entrustment
No such cases in the reporting period.
（2）Contracting
No such cases in the reporting period.
（3）Leasing
No such cases in the reporting period.
2.Significant guarantees
（1）Guarantees
InRMB’0000
||||||||||
|-|-|-|-|-|-|-|-|-|
|External Guarantee (Exclude controlled subsidiaries)|||||||||
||Relevant||||||||
||||Date of|||||Guarantee|
||disclosure|Amount|||||Complete||
||||happening|Actual||||for|
|Name of the|date/No. of|of|||||implement||
||||(Date of|mount of|Guarantee type|Guarantee term||associated|
|Company|the|Guarant|||||ation||
||||signing|guarantee||||parties|
||guaranteed|ee|||||or not||
||||agreement)|||||(Yes or no)|
||amount||||||||
|Hangzhou Steam|October 22,2016|20,800|December 28,2016|20,800|Mortgage|Two years|No|Yes|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Turbine Power||||||||from the date|||||
|Group Co., Ltd||||||||of expiration|||||
|||||||||of the|||||
|||||||||principal debt|||||
||||||Total amount ofoutward||||||||
|Total amount of outward guaranteeapproved|||||||||||||
||||20,800||guarantee actuaily incurred|||20,800|||||
|in the report period（A1）|||||||||||||
||||||in the report period（A2）||||||||
||||||Total balance of actual||||||||
|Total of external guarantee|||||||||||||
||||20,800||external guarantee at|||20,800|||||
|approved at Period-end(A3)|||||||||||||
||||||Period-end(A4)||||||||
|Guarantee of the Company for the controlling subsidiaries|||||||||||||
||Relevant||||||||||Complet||
|||||Date of||||||||Guarantee|
||disclosure||||||||||e||
|Name of the||Amount||happening||Actual||||||for|
||date/No. of||||||Guarantee||Guarantee||impleme||
|Company||of||(Date o||mount of||||||associated|
||the||||||type||term||ntation||
|guaranteed||guarantee||signing||guarantee||||||parties|
||guaranteed||||||||||or||
|||||agreement)||||||||(Yes or no)|
||amount||||||||||not||
|Hangzhou|||||||||||||
|Guoneng Steam|||||||||||||
||||||||The joint liability||||||
|Turbine|January 21,2017|2,000||January 20,20 17||2,000|||1 year||No|No|
||||||||guaranty||||||
|Engineering Co.,|||||||||||||
|Ltd.|||||||||||||
|||||||Total of actual guarantee|||||||
|Total of guarantee for subsidiaries|||||||||||||
|||2,000||||for subsidiaries in the|||1,900||||
|approved in the Period (B1)|||||||||||||
|||||||Period (B2)|||||||
|||||||Total of actual guarantee|||||||
|Total of guarantee for subsidiaries|||||||||||||
|||2,000||||for subsidiaries at|||1,900||||
|approved at Period-end (B3)|||||||||||||
|||||||Period-end (B4)|||||||
|Guarantee of the subsidiaries for the controlling subsidiaries|||||||||||||
||Relevant||||||||||||
|||||Date of||||||Complete||Guarantee|
||disclosure||||||||||||
|Name of the||Amount||happening||Actual||||implement||for|
||date/No. of||||||Guarantee||Guarant||||
|Company||of||(Date o||mount of||||ation||associated|
||the||||||type||ee term||||
|guaranteed||guarantee||signing||guarantee||||or||parties|
||guaranteed||||||||||||
|||||agreement)||||||not||(Yes or no)|
||amount||||||||||||
|Hangzhou|||||||||||||
|Guoneng Steam|||||||||||||
||||||||The joint liability||||||
|Turbine|January 21,2017|5,000||January 20,2017||5,000|||1 year|No||No|
||||||||guaranty||||||
|Engineering Co.,|||||||||||||
|Ltd.|||||||||||||
|Hangzhou|||||||||||||
||||||||The joint liability||||||
|Guoneng Steam|April 26,2017|10,000||April 26,2017||10,000|||1 year|No||No|
||||||||guaranty||||||
|Turbine|||||||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||
|-|-|-|-|-|-|-|
|Engineering Co.,|||||||
|Ltd.|||||||
|||||Total amount of guarantee to|||
|Total guarantee quota to the subsidiaries||||the subsidiaries actually|||
|||15,000||||6,183|
|approved in the reporting period (C1)||||incurred in the reporting|||
|||||period (C2)|||
|||||Total balance of actual|||
|Total guarantee quota to the subsidiaries|||||||
|||||guarantee to the subsidiaries|||
|approved at the end of the reporting period||15,000||||6,183|
|||||at the end of the reporting|||
|(C3)|||||||
|||||period (C4)|||
|Total of Company’s guarantee（namely total of the large three aforementioned）|||||||
|Total of guarantee in the Period|||Total of actual guarantee in||||
||37,800||||28,883||
|（A1+B1+C1）|||the Period（A2+B2+C2）||||
||||Total of actual guarantee at||||
|Total of guarantee at Period-end|||||||
||37,800||Period-end||28,883||
|（A3+B3+C3）|||||||
||||（A4+B4+C4）||||
|The proportion of the total amount of actually guarantee in the net|||||||
||||4.51%||||
|assets of the company(A4+B4+C4)|||||||
|Including ：|||||||
|Amount of guarantee for shareholders, actual controller and its|||||||
||||20,800||||
|associated parties（D）|||||||
|The debts guarantee amount provided for the|||||||
|Guaranteed parties whose assets-liability ratio exceed|||0||||
|70% directly or indirectly（E）|||||||
|Proportion of total amount of guarantee in net assets of the company|||||||
||||0||||
|exceed 50%（F）|||||||
|Total guarantee Amount of the abovementioned guarantee（s D+E+F）|||20,800||||
|Explanations on possibly bearing joint and several liquidating|||||||
||||Nil||||
|responsibilities for undue guarantees ( If any)|||||||
|Explanations on external guarantee against regulated procedures(If|||||||
||||Nil||||
|any)|||||||

Description of the guarantee with complex method
(1) Hangzhou Heavy Machinery Co., Ltd, which is the company's subsidiary, had made an application of special construction funds of RMB 0.208 billion to China Development Fund Co.,Ltd, and it has signed the four-party China Development Fund Investment Contract with China Development Fund ,the company and Hangzhou Steam Turbine Group Co.,Ltd. In order to ensure the performance of the "Investment contract" by Hangzhou steam group, the company and the Heavy Machinery Co., Ltd provide guarantee for Hangzhou Steam Group in the forms of pledge and mortgage.
The contents is detailed in the Announcement on External Guarantee of Hangzhou Steam Turbine Co., Ltd.
announced on October 22, 2016 at the website designated by the Shenzhen Stock Exchange (http //
www.cninfo.com.cn). (Announcement No. 2016-75)
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017（2）Illegal providing of external guarantees
No illegal providing of external guarantees in the report period.
3. Other significant contracts
No such cases in the reporting period.
XV.Social responsibilities
1.Overview of the annual targeted poverty alleviation
The company has no precise social responsibility for poverty alleviation in theperiodand bas no follow-up plan either.
2.Major environmental protection
The listed company and its subsidiary not belongs to the key sewage units released from environmental protection department Not applicable such cases in the reporting period.
XVI.Other material events
No such cases in the reporting period.
XVII. Material events of subsidiaries
Not applicable
VI. Change of share capital and shareholding of Principal Shareholders
I.Changes in share capital
1. Changes in share capital
In shares
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||Before the change||Increase/decrease（+，-）|||||After the Change||
||Amount|Proportion|||Capitalizat|||||
||||Share|Bonus|ion of|||||
||||||common|Other|Subtotal|Quantity|Proportion|
||||allotment|shares||||||
||||||reserve|||||
||||||fund|||||
|I. Shares with trade restriction|479,944,281|63.65%|0|0|0|1,044|1,044|479,945,325|63.65%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|conditions||||||||||
|2. State-owned shares|479,824,800|63.64%|0|0|0|0|0|479,824,800|63.64%|
|3. Other domestic shares|119,481|0.01%|0|0|0|1,044|1,044|120,525|0.01%|
|Domestic natural person||||||||||
||119,481|0.01%|0|0|0|1,044|1,044|120,525|0.01%|
|shares||||||||||
|II. Shares without trading||||||||||
||274,066,119|36.35%|0|0|0|-1,044|-1,044|274,065,075|36.35%|
|limited conditions||||||||||
|2.Foreign shares listed at||||||||||
||274,066,119|36.35%|0|0|0|-1,044|-1,044|274,065,075|36.35%|
|home||||||||||
|III. Total of capital shares|754,010,400|100.00%|0|0|0|0|0|754,010,400|100.00%|

 Causes of Change of shares
Not applicable
Approval of change of the shares
Not applicable
Transfer in change of shares
Not applicable
Influence of the change of the shares upon such financial indicators as the basic EPS and diluted EPS, net asset value per share attributable to the common stockholders in the past year and the latest period
Not applicable
Other information the Company considers it necessary or required by the securities regulatory authority to be disclosed
Not applicable
2. Change of shares with limited sales condition
Not applicable
II.Issuing and listing
Not applicable
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 III. Shareholders and shareholding
In Shares
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||||||Total number of preferred|||||||
|Total number of common||||||||||||
||||||shareholders that had restored the|||||||
|shareholders at the end of the||15,147|||||||0|||
||||||voting right at the end of the|||||||
|reporting period||||||||||||
||||||reporting period (if any) (note 8)|||||||
|Particulars about shares held above 5% by shareholders or top ten shareholders||||||||||||
|||||||||||Number of||
|||||||||||share||
||||Proporti|||||||||
|||||Number of||Changes in|Amount of|Amount of||pledged/froz||
||Nature of||on of|||||||||
|Shareholders||||shares held at||reporting|restricted shares|un-restricted||en||
||shareholder||shares|||||||||
|||||period -end||period|held|shares held||State||
||||held（%）||||||||Amo|
|||||||||||of||
||||||||||||unt|
|||||||||||share||
|Hangzhou Steam Turbine Power GroupCo., Ltd.|State-ownedlegal person||63.64%|479,824,800||0|479,824,800|0||||
|Shanwan Hongyuan Securities (HK)Co.,Ltd.|Foreign legalperson||0.65%|4,901,766||-331,500|0|4,901,766||||
|BBH A/C VANGUARD EMERGINGMARKETS STOCK INDEX FUND|Foreign legalperson||0.63%|4,722,804||0|0|4,722,804||||
|NORGES BANK|Foreign legalperson||0.57%|4,303,675||0|0|4,303,675||||
|VANGUARD TOTALINTERNATIONAL STOCK INDEXFUND|Foreign legalperson||0.46%|3,454,046||83,900|0|3,454,046||||
|GUOTAI JUNANSECURITIES(HONGKONG) LIMITED|Foreign legalperson||0.38%|2,885,894||-1,098,274|0|2,885,894||||
|CHINA INT'L CAPITAL CORP HONGKONG SECURITIES LTD|Foreign legalperson||0.32%|2,425,960||150,000|0|2,425,960||||
|ISHARES CORE MSCI EMERGINGMARKETS ETF|Foreign legalperson||0.32%|2,382,800||832,300|0|2,382,800||||
|China Merchants Secutities(HK)Co., Ltd.|State-ownedlegal person||0.31%|2,304,255||162,275|0|2,304,255||||
|Xia Zulin|DomesticNatural person||0.28%|2,100,000||0|0|2,100,000||||
|Strategy investors or general legal person becomes top 10||||||||||||
|shareholders due to rights issued (if applicable)（See|||Not applicable|||||||||
|Notes 3）||||||||||||
||||(1) Hangzhou Steam Turbine Power Group Co., Ltd. is the holder of state-shares of the|||||||||
||||Company, all other shareholders’ are holders of domestic listed foreign shares (B shares)|||||||||
|Explanation on associated relationship among the|||(2) There is no relationship between Hangzhou Steam Turbine Power Group Co., Ltd.|||||||||
||||and other shareholders;|||||||||
|aforesaid shareholders||||||||||||
||||(3) Hangzhou Steam Turbine Group Co., Ltd. is not an “action-in-concert” party with any|||||||||
||||of other shareholders as described by the “Administration Rules of Informational|||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||
|-|-|-|-|-|
||Disclosure about Change of Shareholding Statues of PLCs”.||||
|Top 10 holders of shares without trading limited conditions|||||
|||Amount of unconditional|Category of shares||
|Name of the shareholder|||||
|||shares held at end of period|Category of shares|Amount|
|Shanwan Hongyuan Securities (HK) Co.,Ltd.||4,901,766|Foreign shares placed||
|||||4,901,766|
||||in domestic exchange||
|BBH A/C VANGUARD EMERGING MARKETS STOCK INDEXFUND||4,722,804|Foreign shares placed||
|||||4,722,804|
||||in domestic exchange||
|NORGES BANK||4,303,675|Foreign shares placed||
|||||4,303,675|
||||in domestic exchange||
|VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND||3,454,046|Foreign shares placed||
|||||3,454,046|
||||in domestic exchange||
|GUOTAI JUNAN SECURITIES(HONGKONG) LIMITED||2,885,894|Foreign shares placed||
|||||2,885,894|
||||in domestic exchange||
|CHINA INT'L CAPITAL CORP HONG KONG SECURITIES LTD||2,425,960|Foreign shares placed||
|||||2,425,960|
||||in domestic exchange||
|ISHARES CORE MSCI EMERGING MARKETS ETF||2,382,800|Foreign shares placed||
|||||2,382,800|
||||in domestic exchange||
|China Merchants Secutities(HK)Co., Ltd.||2,304,255|Foreign shares placed||
|||||2,304,255|
||||in domestic exchange||
|Xia Zulin||2,100,000|Foreign shares placed||
|||||2,100,000|
||||in domestic exchange||
|CREDIT SUISSE AG HONG KONG BRANCH||1,729,759|Foreign shares placed||
|||||1,729,759|
||||in domestic exchange||
|||1）It is unknown to the Company if there is any relationship among the top|||
|Explanation on associated relationship or consistent action among the||10 common share holders without restriction;|||
|top 10 shareholders of non-restricted negotiable shares and that||(2) Hangzhou Steam Turbine Group Co., Ltd. is not an action-in-concert”|||
|between the top 10 shareholders of non-restricted negotiable shares and||party with any of other shareholders as described by the “Administration|||
|top 10 shareholders||Rules of Informational Disclosure about Change of Shareholding Statues of|||
|||PLCs”.|||
|Notes to the shareholders involved in financing securities (if any)(See|||||
|||Not applicable|||
|Notes 4)|||||

Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period.
The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company have no buy–back agreement dealing in reporting period.
IV. Change of the controlling shareholder or the actual controller
Change of the controlling shareholder in the reporting period
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 There was no any change of the controlling shareholder of the Company in the reporting period.
Change of the actual controller in the reporting period
There was no any change of the actual controller of the Company in the reporting period.
VII. Situation of the Preferred Shares
The Company had no preferred shares in the reporting period
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 VIII. Information about Directors, Supervisors and Senior Executives
I. Change in shares held by directors, supervisors and senior executives
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||||Amount of|Amount of|||Number of|Number of|
||||||||Number of|||
||||Shares|shares|shares|Shares||restricted|restricted|
||||||||restricted stock|||
|||Office|held at the|increased at|decreased at|held at the||stock granted|stock granted|
|Name|Position||||||granted at the|||
|||status|year-begin|the reporting|the reporting|year-endin||at the|at the|
||||||||year-begin .|||
||||(share)|period(share|period(share|g（share）||reporting|year-ending(sh|
||||||||share)|||
|||||)|)|||period(share)|are)|
|||In||||||||
|Zhen Bin|||0|0|0|0|0|0|0|
||Chairman|||||||||
|||office||||||||
|Yan||In||||||||
||||0|0|0|0|0|0|0|
||Vice Chairman|||||||||
|Jinhua||office||||||||
|Yang||In||||||||
||||0|0|0|0|0|0|0|
||Vice Chairman|||||||||
|Yongming||office||||||||
|Nie||In||||||||
||||0|0|0|0|0|0|0|
||Director|||||||||
|Zhonghai||office||||||||
|||In||||||||
|Ye Zhong|||0|0|0|0|0|0|0|
||Director|||||||||
|||office||||||||
|Wang|Director, secretary of the|In||||||||
||||0|0|0|0|0|0|0|
|Gang|board|office||||||||
|Kong|Director, Vice GM, Chief|In||||||||
||||0|0|0|0|0|0|0|
|Jianqiang|engineer|office||||||||
|Gu||In||||||||
||Independent Director||0|0|0|0|0|0|0|
|Xinjian||office||||||||
|Ma||In||||||||
||Independent Director||0|0|0|0|0|0|0|
|Lihong||office||||||||
|ZhangXia||In||||||||
||Independent Director||0|0|0|0|0|0|0|
|oyan||office||||||||
|Chen||In||||||||
||Independent Director||0|0|0|0|0|0|0|
|Danhong||office||||||||
||Chairman of the|In||||||||
|Li Shijie|||0|0|0|0|0|0|0|
||Supervisory Committee|office||||||||
|Wang||In||||||||
||||70,076|7,100|0|77,176|0|0|0|
||Supervisor|||||||||
|Xiaohui||office||||||||
|Liu||In||||||||
||||15,400|1,200|0|16,600|0|0|0|
||Supervisor|||||||||
|Zhiyong||office||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||In||||||||
|Lu Jianhua|Employee Supervisor||0|0|0|0|0|0|0|
|||office||||||||
|||In||||||||
|Fang Yin|Employee Supervisor||0|0|0|0|0|0|0|
|||office||||||||
|Zhang||In||||||||
||Vice GM||66,924|0|0|66,924|0|0|0|
|Shutan||office||||||||
|Pu||In||||||||
||Vice GM, Chif Accountant||0|0|0|0|0|0|0|
|Yangshuo||office||||||||
|Li||In||||||||
||Vice GM||0|0|0|0|0|0|0|
|Jiansheng||office||||||||
|Wang||In||||||||
||Vice GM||0|0|0|0|0|0|0|
|Zhengrong||office||||||||
|Liu||Dimiss||||||||
||Director||0|0|0|0|0|0|0|
|Guoqiang||ion||||||||
|Zhang||Dimiss||||||||
||Supervisor||0|0|0|0|0|0|0|
|Yougen||ion||||||||
|Yu||||||||||
||Vice GM, secretary of the|Dimiss||||||||
|Changqua|||0|0|0|0|0|0|0|
||board|ion||||||||
|n||||||||||
|Total|--|--|152,400|8,300|0|160,700|0|0|0|

 II. Change in shares held by directors, supervisors and senior executives
||||||
|-|-|-|-|-|
|Name|Positions|Types|Date|Reason|
|||||Due to the legal retirement age, apply|
|Liu Guoqiang|Director|Dimission|June 8,2017||
|||||for resignation of director.|
|||||Due to the legal retirement age, apply|
|||||for resignation of Vice General|
|Yu Changquan|Vice GM, secretary of the board|Dimission|June 8,2017||
|||||Manager and secretary of the board|
|||||Due to the legal retirement age, apply|
|Zhang Yougen|Supervisor|Dimission|June 8,2017||
|||||for resignation of Supervisor.|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 IX. Corporate Bond
Whether the company has corporate bonds that have been publicly issued and listed on the stock exchange, and not yet due or due but not folly cashed on the approval date of annual report
No
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 X. Financial Report
I.Auditors’ Report
The Semi-annual Financial Report is not audited.
II. The Financial Statements
All figures in the Notes to the Financial Statements are in RMB.
1. Consolidated Balance Sheet
Prepared by: Hangzhou Steam Turbine Co., Ltd
June 30,2017
In RMB
||||
|-|-|-|
|Items|At the end of term|Beginning of term|
|Current asset：|||
|Monetary fund|1,055,809,378.48|895,037,559.34|
|Settlement provision|||
|Outgoing call loan|||
|Financial assets measured at fair value with variations accounted into|||
|current income account|||
|Derivative financial assets|||
|Bill receivable|696,089,138.40|479,716,321.62|
|Account receivable|1,812,297,540.52|1,870,173,348.32|
|Prepayments|449,234,213.67|202,184,858.83|
|Insurance receivable|||
|Reinsurance receivable|||
|Provisions of Reinsurance contracts receivable|||
|Interest receivable|||
|Dividend receivable|6,900,000.00||
|Other account receivable|20,732,713.40|31,024,707.72|
|Repurchasing of financial assets|||
|Inventories|2,052,667,695.99|1,901,544,358.26|
|Assets held for sales|||
|Non-current asset due in 1 year|||
|Other current asset|773,074,562.65|863,018,479.59|
|Total of current assets|6,866,805,243.11|6,242,699,633.68|
|Non-current assets：|||
|Loans and payment on other’s behalf disbursed|||
|Disposable financial asset|3,010,113,616.40|3,060,865,862.60|
|Expired investment in possess|||
|Long-term receivable|||
|Long term share equity investment|||
|Property investment|||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Fixed assets|601,473,873.27|615,922,109.91|
|Construction in progress|156,071,663.76|153,743,889.41|
|Engineering material|||
|Fixed asset disposal|||
|Production physical assets|||
|Gas & petrol|||
|Intangible assets|294,379,424.68|297,405,434.08|
|R & D petrol|||
|Goodwill|||
|Long-germ expenses to be amortized|1,298,386.93|1,430,968.81|
|Deferred income tax asset|181,540,697.65|178,831,809.85|
|Other non-current asset|||
|Total of non-current assets|4,244,877,662.69|4,308,200,074.66|
|Total of assets|11,111,682,905.80|10,550,899,708.34|
|Current liabilities|||
|Short-term loans|197,700,000.00|173,000,000.00|
|Loan from Central Bank|||
|Deposit received and hold for others|||
|Call loan received|||
|Financial liabilities measured at fair value with variations accounted into|||
|current income account|||
|Derivative financial liabilities|||
|Bill payable|151,467,745.11|143,007,715.10|
|Account payable|1,098,063,222.70|853,452,589.51|
|Advance payment|2,197,267,051.95|1,827,959,793.62|
|Selling of repurchased financial assets|||
|Fees and commissions receivable|||
|Employees’ wage payable|61,066,908.72|71,224,634.03|
|Tax payable|30,489,787.90|90,239,673.16|
|Interest payable||134,376.32|
|Dividend payable|||
|Other account payable|29,028,860.33|30,820,980.80|
|Reinsurance fee payable|||
|Insurance contract provision|||
|Entrusted trading of securities|||
|Entrusted selling of securities|||
|Liabilities held for sales|||
|Non-current liability due in 1 year|18,300,000.00|18,500,000.00|
|Other current liability|||
|Total of current liability|3,783,383,576.71|3,208,339,762.54|
|Non-current liabilities：|||
|Long-term loan|4,900,000.00|4,900,000.00|
|Bond payable|||
|Including：preferred stock|||
|Sustainable debt|||
|Long-term payable|208,330,000.00|208,357,733.33|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Long-term payable employees’s remuneration|||
|Special payable|||
|Expected liabilities|||
|Deferred income|7,230,895.00|5,422,895.00|
|Deferred income tax liability|374,927,562.79|378,256,646.95|
|Other non-current liabilities|||
|Total non-current liabilities|595,388,457.79|596,937,275.28|
|Total of liability|4,378,772,034.50|3,805,277,037.82|
|Owners’ equity|||
|Share capital|754,010,400.00|754,010,400.00|
|Other equity instrument|||
|Including：preferred stock|||
|Sustainable debt|||
|Capital reserves|139,590,345.09|139,590,345.09|
|Less：Shares in stock|||
|Other comprehensive income|2,118,804,200.50|2,137,419,299.84|
|Special reserves|27,410,792.30|27,546,353.37|
|Surplus reserves|621,112,807.78|621,112,807.78|
|Common risk provision|||
|Undistributed profit|2,749,662,841.53|2,705,667,037.15|
|Total of owner’s equity belong to the parent company|6,410,591,387.20|6,385,346,243.23|
|Minority shareholders’ equity|322,319,484.10|360,276,427.29|
|Total of owners’ equity|6,732,910,871.30|6,745,622,670.52|
|Total of liabilities and owners’ equity|11,111,682,905.80|10,550,899,708.34|

 Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiamao
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 2.Parent Company Balance Sheet
In RMB
||||
|-|-|-|
|Items|At the end of term|Beginning of term|
|Current asset：|||
|Monetary fund|509,852,012.62|293,454,126.93|
|Financial assets measured at fair value|||
|with variations accounted into current|||
|income account|||
|Derivative financial assets|||
|Bill receivable|432,739,001.55|269,527,716.22|
|Account receivable|1,303,750,154.04|1,424,950,696.58|
|Prepayments|336,165,228.69|115,383,408.34|
|Interest receivable|||
|Dividend receivable|6,900,000.00||
|Other account receivable|6,716,918.20|68,004,706.24|
|Inventories|1,613,252,066.78|1,446,652,799.71|
|Assets held for sales|||
|Non-current asset due in 1 year|||
|Other current asset|520,521,180.25|600,000,000.00|
|Total of current assets|4,729,896,562.13|4,217,973,454.02|
|Non-current assets：|||
|Disposable financial asset|2,969,353,926.82|3,020,106,173.02|
|Expired investment in possess|||
|Long-term receivable|||
|Long term share equity investment|502,919,378.03|502,919,378.03|
|Property investment|||
|Fixed assets|294,792,259.17|315,900,380.66|
|Construction in progress|97,239,204.16|94,170,909.99|
|Engineering material|||
|Fixed asset disposal|||
|Production physical assets|||
|Gas & petrol|||
|Intangible assets|172,814,800.34|173,826,293.57|
|R & D petrol|||
|Goodwill|||
|Long-germ expenses to be amortized|507,773.78|507,773.78|
|Deferred income tax asset|138,358,890.73|133,581,773.70|
|Other non-current asset|||
|Total of non-current assets|4,175,986,233.03|4,241,012,682.75|
|Total of assets|8,905,882,795.16|8,458,986,136.77|
|Current liabilities|||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Short-term loans|100,000,000.00|100,000,000.00|
|Financial liabilities measured at fair|||
|value with variations accounted into|||
|current income account|||
|Derivative financial liabilities|||
|Bill payable|||
|Account payable|695,002,224.56|486,810,046.42|
|Advance payment|1,730,607,672.72|1,476,780,338.78|
|Employees’ wage payable|36,149,617.16|44,035,408.19|
|Tax payable|13,893,568.58|64,247,326.24|
|Interest payable|||
|Dividend payable|||
|Other account payable|13,499,400.95|21,562,998.72|
|Classified as held for sale debt|||
|Non-current liability due in 1 year|||
|Other current liability|||
|Total of current liability|2,589,152,483.97|2,193,436,118.35|
|Non-current liabilities：|||
|Long-term loan|||
|Bond payable|||
|Including：preferred stock|||
|Sustainable debt|||
|Long-term payable|||
|Long-term payable to employees|||
|Special payable|||
|Expected liabilities|||
|Deferred income|400,000.00||
|Deferred income tax liability|374,927,562.79|378,256,646.95|
|Other non-current liabilities|||
|Total of Non-current liabilities|375,327,562.79|378,256,646.95|
|Total of liability|2,964,480,046.76|2,571,692,765.30|
|Owners’ equity|||
|Share capital|754,010,400.00|754,010,400.00|
|Other equity instrument|||
|Including：preferred stock|||
|Sustainable debt|||
|Capital reserves|138,953,250.09|138,953,250.09|
|Less：Shares in stock|||
|Other comprehensive income|2,118,935,346.56|2,137,800,156.80|
|Special reserves|10,848,700.83|10,874,033.85|
|Surplus reserves|602,356,402.65|602,356,402.65|
|Undistributed profit|2,316,298,648.27|2,243,299,128.08|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Total of owners’ equity|5,941,402,748.40|5,887,293,371.47|
|Total of liabilities and owners’ equity|8,905,882,795.16|8,458,986,136.77|

 Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiamao 3.Consolidated Income statement
In RMB
||||
|-|-|-|
|Items|Report period|Same period of the previous year|
|I. Income from the key business|1,663,724,702.26|1,367,423,771.88|
|Incl：Business income|1,663,724,702.26|1,367,423,771.88|
|Interest income|||
|Insurance fee earned|||
|Fee and commission received|||
|II. Total business cost|1,690,731,044.09|1,416,467,334.78|
|Incl：Business cost|1,192,385,051.48|850,937,906.04|
|Interest expense|||
|Fee and commission paid|||
|Insurance discharge payment|||
|Net claim amount paid|||
|Insurance policy dividend paid|||
|Insurance policy dividend paid|||
|Reinsurance expenses|||
|Business tax and surcharge|18,736,550.58|8,423,250.87|
|Sales expense|81,874,015.85|75,867,593.98|
|Administrative expense|354,411,777.81|355,106,918.55|
|Financial expenses|7,945,244.29|512,029.17|
|Asset impairment loss|35,378,404.08|125,619,636.17|
|Add：Gains from change of fir value （“-”for loss）|||
|Investment gain（“-”for loss）|88,988,506.53|15,045,334.62|
|Incl: investment gains from affiliates|||
|Gains from currency exchange（“-”for loss）|||
|Other income|||
|III. Operational profit（“-”for loss）|61,982,164.70|-33,998,228.28|
|Add ：Non-operational income|4,554,849.88|6,844,762.02|
|Including：Income from disposal of non-current assets|196,910.10|17,299.04|
|Less：Non business expenses|279,791.13|1,957,694.65|
|Incl：Loss from disposal of non-current assets|16,356.68|181,198.86|
|IV.Total profit(“-”for loss)|66,257,223.45|-29,111,160.91|
|Less：Income tax expenses|6,528,367.57|-2,833,931.34|
|V. Net profit|59,728,855.88|-26,277,229.57|
|Net profit attributable to the owners of parent company|43,995,804.38|-31,252,238.19|
|Minority shareholders’ equity|15,733,051.50|4,975,008.62|
|VI. Other comprehensive income|-18,278,353.57|881,469.91|
|Net of profit of other comprehensive income attributable to owner|-18,615,099.34|375,326.36|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|s of the parent company.|||
|（I）Other comprehensive income items that will not be|||
|reclassified into gains/losses in the subsequent accounting period|||
|1.Re-measurement of defined benefit plans of changes in net debt|||
|or net assets|||
|2.Other comprehensive income under the equity method investee|||
|can not be reclassified into profit or loss.|||
|（II）|||
|Other comprehensive income that will be reclassified into profit o|-18,615,099.34|375,326.36|
|r loss.|||
|1.Other comprehensive income under the equity method investee|||
|can be reclassified into profit or loss.|||
|2.Gains and losses from changes in fair value available for sale fi|||
||-18,864,810.24||
|nancial assets|||
|3.Held-to-maturity investments reclassified to gains and losses of|||
|available for sale financial assets|||
|4.The effective portion of cash flow hedges and losses|||
|5.Translation differences in currency financial statements|249,710.90|375,326.36|
|6.Other|||
|Net of profit of other comprehensive income attributable to Minor|336,745.77|506,143.55|
|ity shareholders’ equity|||
|VII. Total comprehensive income|41,450,502.31|-25,395,759.66|
|Total comprehensive income attributable to the owner of the|||
||25,380,705.04|-30,876,911.83|
|parent company|||
|Total comprehensive income attributable minority shareholders|16,069,797.27|5,481,152.17|
|VIII. Earnings per share|||
|（I）Basic earnings per share|0.06|-0.04|
|(II)Diluted earnings per share|0.06|-0.04|

 Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiamao 4. Income statement of the Parent Company
In RMB
||||
|-|-|-|
|Items|Report period|Same period of the previous year|
|I. Income from the key business|1,116,145,080.61|873,700,389.36|
|Incl：Business cost|848,982,146.60|546,117,341.96|
|Business tax and surcharge|8,356,402.38|4,800,667.41|
|Sales expense|49,356,881.16|47,863,806.18|
|Administrative expense|250,148,727.95|229,290,837.78|
|Financial expenses|6,147,008.61|-1,442,851.52|
|Asset impairment loss|27,643,907.83|112,015,979.74|
|Add：Gains from change of fir value （“-”for loss）|||
|Investment gain（“-”for loss）|141,313,652.53|78,813,819.71|
|Incl: investment gains from affiliates|||
|Other income|||
|II. Operational profit（“-”for loss）|66,823,658.61|13,868,427.52|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Add ：Non-operational income|1,412,613.95|17,813.04|
|Including：Income from disposal of non-current assets||17,299.04|
|Less：Non business expenses|13,869.40|755,697.76|
|Incl：Loss from disposal of non-current assets|1,824.00|10,000.00|
|III.Total profit(“-”for loss)|68,222,403.16|13,130,542.80|
|Less：Income tax expenses|-4,777,117.03|-9,434,020.27|
|IV. Net profit（“-”for net loss）|72,999,520.19|22,564,563.07|
|V.Net of profit of other comprehensive income|-18,864,810.24||
|（I）Other comprehensive income items that will not be|||
|reclassified into gains/losses in the subsequent accounting period|||
|1.Re-measurement of defined benefit plans of changes in net debt|||
|or net assets|||
|2.Other comprehensive income under the equity method investee|||
|can not be reclassified into profit or loss.|||
|（ II ）|||
||-18,864,810.24||
|Other comprehensive income that will be reclassified into profit o|||
|r loss.|||
|1.Other comprehensive income under the equity method investee|||
|can be reclassified into profit or loss.|||
|2.Gains and losses from changes in fair value available for sale fi|||
||-18,864,810.24||
|nancial assets|||
|3.Held-to-maturity investments reclassified to gains and losses of|||
|available for sale financial assets|||
|4.The effective portion of cash flow hedges and losses|||
|5.Translation differences in currency financial statements|||
|6.Other|||
|VI. Total comprehensive income|54,134,709.95|22,564,563.07|
|VII. Earnings per share：|||
|（I）Basic earnings per share|0.10|0.03|
|(II)Diluted earnings per share|0.10|0.03|

 Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiamao
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 5. Consolidated Cash flow statement
In RMB
||||
|-|-|-|
|Items|Report period|Same period of the previous year|
|I.Cash flows from operating activities|||
|Cash received from sales of goods or rending of|1,555,387,534.42|1,473,696,926.54|
|services|||
|Net increase of customer deposits and capital|||
|kept for brother company|||
|Net increase of loans from central bank|||
|Net increase of inter-bank loans from other|||
|financial bodies|||
|Cash received against original insurance contract|||
|Net cash received from reinsurance business|||
|Net increase of client deposit and investment|||
|Net increase of trade financial asset disposal|||
|Cash received as interest, processing fee and|||
|commission|||
|Net increase of inter-bank fund received|||
|Net increase of repurchasing business|||
|Tax returned|12,410,348.67|3,966,504.78|
|Other cash received from business operation|8,010,282.03|6,687,244.05|
|Sub-total of cash inflow|1,575,808,165.12|1,484,350,675.37|
|Cash paid for purchasing of merchandise and|981,236,472.17|734,853,982.91|
|services|||
|Net increase of client trade and advance|||
|Net increase of savings n central bank and brother|||
|company|||
|Cash paid for original contract claim|||
|Cash paid for interest, processing fee and|||
|commission|||
|Cash paid for policy dividend|||
|Cash paid to staffs or paid for staffs|364,610,619.54|359,098,202.15|
|Taxes paid|161,287,307.24|96,854,083.68|
|Other cash paid for business activities|78,984,121.75|78,845,353.68|
|Sub-total of cash outflow from business activities|1,586,118,520.7|1,269,651,622.42|
|Cash flow generated by business operation, net|-10,310,355.58|214,699,052.95|
|II.Cash flow generated by investing|||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Cash received from investment retrieving|48,558,351.80||
|Cash received as investment gains|82,088,506.53|15,045,334.62|
|Net cash retrieved from disposal of fixed assets,|411,254.18|16,900.00|
|intangible assets, and other long-term assets|||
|Net cash received from disposal of subsidiaries or|||
|other operational units|||
|Other investment-related cash received|1,819,767,338.00|812,150,000.00|
|Sub-total of cash inflow due to investment|1,950,825,450.51|827,212,234.62|
|activities|||
|Cash paid for construction of fixed assets,|43,584,080.28|48,665,372.66|
|intangible assets and other long-term assets|||
|Cash paid as investment|20,000,000.00||
|Net increase of loan against pledge|||
|Net cash received from subsidiaries and other|||
|operational units|||
|Other cash paid for investment activities|1,729,150,000.00|938,850,000.00|
|Sub-total of cash outflow due to investment|1,792,734,080.28|987,515,372.66|
|activities|||
|Net cash flow generated by investment|158,091,370.23|-160,303,138.04|
|III.Cash flow generated by financing|||
|Cash received as investment||706,350.00|
|Incl: Cash received as investment from minor|||
|shareholders|||
|Cash received as loans|84,700,000.00|69,000,000.00|
|Cash received from bond placing|||
|Other financing –related ash received|||
|Sub-total of cash inflow from financing activities|84,700,000.00|69,706,350.00|
|Cash to repay debts|60,200,000.00|73,200,000.00|
|Cash paid as dividend, profit, or interests|40,718,824.40|38,336,434.28|
|Incl: Dividend and profit paid by subsidiaries to|||
|minor shareholders|||
|Other cash paid for financing activities|12,824,456.40||
|Sub-total of cash outflow due to financing|113,743,280.80|111,536,434.28|
|activities|||
|Net cash flow generated by financing|-29,043,280.80|-41,830,084.28|
|IV. Influence of exchange rate alternation on cash|-3,125,917.43|4,197,480.42|
|and cash equivalents|||
|V.Net increase of cash and cash equivalents|115,611,816.42|16,763,311.05|
|Add: balance of cash and cash equivalents at the|895,037,559.34|751,596,796.24|
|beginning of term|||
|VI ..Balance of cash and cash equivalents at the|1,010,649,375.76|768,360,107.29|
|end of term|||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiamao
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 6. Cash Flow Statement of the Parent Company
In RMB
||||
|-|-|-|
|Items|Amount in this period|Amount in last period|
|I.Cash flows from operating activities|||
|Cash received from sales of goods or rending of|||
||1,049,529,364.15|956,195,266.24|
|services|||
|Tax returned||359,071.25|
|Other cash received from business operation|2,093,123.85|4,624,232.32|
|Sub-total of cash inflow|1,051,622,488.00|961,178,569.81|
|Cash paid for purchasing of merchandise and|||
||734,953,285.93|421,216,904.08|
|services|||
|Cash paid to staffs or paid for staffs|253,543,483.95|252,191,310.76|
|Taxes paid|94,956,342.26|30,208,059.26|
|Other cash paid for business activities|27,015,518.68|21,407,844.59|
|Sub-total of cash outflow from business activities|1,110,468,630.82|725,024,118.69|
|Cash flow generated by business operation, net|-58,846,142.82|236,154,451.12|
|II.Cash flow generated by investing|||
|Cash received from investment retrieving|48,558,351.80||
|Cash received as investment gains|134,413,652.53|78,813,819.71|
|Net cash retrieved from disposal of fixed assets,|||
|||16,900.00|
|intangible assets, and other long-term assets|||
|Net cash received from disposal of subsidiaries or|||
|other operational units|||
|Other investment-related cash received|1,145,943,056.16|383,150,000.00|
|Sub-total of cash inflow due to investment|||
||1,328,915,060.49|461,980,719.71|
|activities|||
|Cash paid for construction of fixed assets,|||
||24,023,500.62|33,856,128.76|
|intangible assets and other long-term assets|||
|Cash paid as investment|20,000,000.00||
|Net cash received from subsidiaries and other|||
|operational units|||
|Other cash paid for investment activities|1,005,000,000.00|643,150,000.00|
|Sub-total of cash outflow due to investment|||
||1,049,023,500.62|677,006,128.76|
|activities|||
|Net cash flow generated by investment|279,891,559.87|-215,025,409.05|
|III.Cash flow generated by financing|||
|Cash received as investment|||
|Cash received as loans|||
|Cash received from bond placing|||
|Other financing –related ash received|||
|Sub-total of cash inflow from financing|||
|activities|||
|Cash to repay debts|1,693,611.11|1,702,916.67|
|Cash paid as dividend, profit, or interests|||
|Other cash paid for financing activities|||
|Sub-total of cash outflow due to financing|||
||1,693,611.11|1,702,916.67|
|activities|||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Net cash flow generated by financing|-1,693,611.11|-1,702,916.67|
|IV. Influence of exchange rate alternation on cash|||
||-3,383,920.25|2,534,574.35|
|and cash equivalents|||
|V.Net increase of cash and cash equivalents|215,967,885.69|21,960,699.75|
|Add: balance of cash and cash equivalents at the|||
||293,454,126.93|387,916,202.79|
|beginning of term|||
|VI ..Balance of cash and cash equivalents at the|||
||509,422,012.62|409,876,902.54|
|end of term|||

Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiamao
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 7. Consolidated Statement on Change inOwners’ Equity
Amount in this period
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Amount in this period|||||||||||||
||Owner’s equity Attributable to the Parent Company|||||||||||Minor||
|||Other Equity||||||||||||
|||||||Less||||||||
|||instrument||||||||||||
|Items||pref||||:Shar|Other|Specialized||Common risk||shareholders’|Total of owners’|
||Share Capital|erre|Sust|Ot|Capital reserves|es in|Comprehensive|reserve|Surplus reserves|provisi|Attributable profit|equity|equity|
|||d|aina|he||stoc|Income|||on||||
|||stoc|ble|r||k||||||||
|||k|debt|||||||||||
|I.Balance at the end of last year|754,010,400.00||||139,590,345.09||2,137,419,299.84|27,546,353.37|621,112,807.78||2,705,667,037.15|360,276,427.29|6,745,622,670.52|
|Add: Change of accounting policy||||||||||||||
|Correcting of previous errors||||||||||||||
|Merger of entities under common||||||||||||||
|control||||||||||||||
|Other||||||||||||||
|II.Balance at the beginning of||||||||||||||
||754,010,400.00||||139,590,345.09||2,137,419,299.84|27,546,353.37|621,112,807.78||2,705,667,037.15|360,276,427.29|6,745,622,670.52|
|current year||||||||||||||
|III.Changed in the current year|||||||-18,615,099.34|-135,561.07|||43,995,804.38|-37,956,943.19|-12,711,799.22|
|（1）Total comprehensive income|||||||-18,615,099.34||||43,995,804.38|16,069,797.27|41,450,502.31|
|（II）Investment or decreasing of||||||||||||||
|||||||||||||-19,800,000.00|-19,800,000.00|
|capital by owners||||||||||||||
|1．Ordinary Shares invested by S||||||||||||||
|hareholders||||||||||||||
|2．Holders of other equity instru||||||||||||||
|ments invested capital||||||||||||||
|3．Amount of shares paid and||||||||||||||
|accounted as owners’ equity||||||||||||||
|4．Other||||||||||||||
|（III）Profit allotment||||||||||||-34,303,448.90|-34,303,448.90|
|1.Providing of surplus reserves||||||||||||||
|2.Providing of common risk||||||||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||||
|-|-|-|-|-|-|-|-|-|
|provisions|||||||||
|3．Allotment to the owners (or|||||||||
||||||||-34,303,448.90|-34,303,448.90|
|shareholders)|||||||||
|4．Other|||||||||
|(IV) Internal transferring of|||||||||
|owners’ equity|||||||||
|1. Capitalizing of capital reserves|||||||||
|(or to capital shares)|||||||||
|2. Capitalizing of surplus reserves|||||||||
|(or to capital shares)|||||||||
|3．Making up losses by surplus|||||||||
|reserves.|||||||||
|4. Other|||||||||
|(V). Special reserves||||-135,561.07|||76,708.44|-58,852.63|
|1. Provided this year||||537,862.83|||220,142.02|758,004.85|
|2．Used this term||||673,423.90|||143,433.58|816,857.48|
|（VI）Other|||||||||
|IV. Balance at the end of this term|754,010,400.00|139,590,345.09|2,118,804,200.50|27,410,792.30|621,112,807.78|2,749,662,841.53|322,319,484.10||

 Amount in last year
In RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||Amount in last year|||||||||||||
||Owner’s equity Attributable to the Parent Company|||||||||||||
||Share Capital|Other Equity|||Capital reserves||||Surplus reserves||Attributable profit|||
|||instrument||||||||||||
|||||||Less:||||Comm||Minor||
|Items||pref||||Shares|OtherComprehensiv|Specialized||on risk||shareholders’|Total of owners’equity|
|||erred|Sustainable|Othe||instock|e Income|reserve||provision||equity||
|||stoc||r||||||||||
||||debt|||||||||||
|||k||||||||||||
|I.Balance at the end of last year|754,010,400.00||||139,590,345.09||-852,752.00|31,764,920.51|621,112,807.78||2,673,711,591.42|369,799,705.35|4,589,137,018.15|
|Add: Change of accounting policy||||||||||||||
|Correcting of previous errors||||||||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||||
|-|-|-|-|-|-|-|-|-|
|Merger of entities under common|||||||||
|control|||||||||
|Other|||||||||
|II.Balance at the beginning of|||||||||
||754,010,400.00|139,590,345.09|-852,752.00|31,764,920.51|621,112,807.78|2,673,711,591.42|369,799,705.35|4,589,137,018.15|
|current year|||||||||
|III.Changed in the current year|||375,326.36|-179,698.16||-31,252,238.19|-28,601,193.39|-59,657,803.38|
|（1）Total comprehensive income|||375,326.36|||-31,252,238.19|5,481,152.16|-25,395,759.67|
|（II）Investment or decreasing of|||||||||
|capital by owners|||||||||
|1．Ordinary Shares invested by She|||||||||
|reholders|||||||||
|2．Holders of other equity instrume|||||||||
|nts invested capital|||||||||
|3．Allotment to the owners (or|||||||||
|shareholders)|||||||||
|4．Other|||||||||
|（III）Profit allotment|||||||-34,421,187.50|-34,421,187.50|
|1.Providing of surplus reserves|||||||||
|2.Providing of common risk|||||||||
|provisions|||||||||
|3．Allotment to the owners (or|||||||||
||||||||-34,421,187.50|-34,421,187.50|
|shareholders)|||||||||
|4．Other|||||||||
|(IV) Internal transferring of owners’|||||||||
|equity|||||||||
|1. Capitalizing of capital reserves|||||||||
|(or to capital shares)|||||||||
|2. Capitalizing of surplus reserves|||||||||
|(or to capital shares)|||||||||
|3．Making up losses by surplus|||||||||
|reserves.|||||||||
|4. Other|||||||||
|(V). Special reserves||||-179,698.16|||338,841.95|159,143.79|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||||
|-|-|-|-|-|-|-|-|-|
|1. Provided this year||||1,168,964.22|||570,903.32|1,739,867.54|
|2．Used this term||||1,348,662.38|||232,061.37|1,580,723.75|
|（VI）Other|||||||||
|IV. Balance at the end of this term|754,010,400.00|139,590,345.09|-477,425.64|31,585,222.35|621,112,807.78|2,642,459,353.23|341,198,511.96|4,529,479,214.77|

 Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiamao
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 8.Statement of change inowner’s Equity of the Parent Company
Amount in this period
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||Amount in this period|||||||||||
|||Other Equity instrument||||Less:||||||
||||||||Other|||||
|Items||||||Shares|||Common risk||Total of owners’|
||Share Capital||||Capital reserves||Comprehensive|Surplus reserves||Attributable profit||
|||preferred||||in|||provision||equity|
||||Sustaina|Other||||||||
|||stock|||||Income|||||
||||ble debt|||stock||||||
|I.Balance at the end of last year||||||||||||
||754,010,400.00||||138,953,250.09||2,137,800,156.80|10,874,033.85|602,356,402.65|2,243,299,128.08|5,887,293,371.47|
|Add: Change of accounting policy||||||||||||
|Correcting of previous errors||||||||||||
|Other||||||||||||
|II.Balance at the beginning of||||||||||||
||754,010,400.00||||138,953,250.09||2,137,800,156.80|10,874,033.85|602,356,402.65|2,243,299,128.08|5,887,293,371.47|
|current year||||||||||||
|III.Changed in the current year||||||||||||
||||||||-18,864,810.24|-25,333.02||72,999,520.19|54,109,376.93|
|（I）Total comprehensive income||||||||||||
||||||||-18,864,810.24|||72,999,520.19|54,134,709.95|
|(II) Investment or decreasing of||||||||||||
|capital by owners||||||||||||
|1．Ordinary Shares invested by sha||||||||||||
|reholders||||||||||||
|2．Holders of other equity instrume||||||||||||
|nts invested capital||||||||||||
|3.Amount of shares paid and||||||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||
|-|-|-|-|-|-|-|-|
|accounted as owners’ equity||||||||
|4．Other||||||||
|（III）Profit allotment||||||||
|1.Providing of surplus reserves||||||||
|2．Allotment to the owners (or||||||||
|shareholders)||||||||
|3．Other||||||||
|(IV) Internal transferring of owners’||||||||
|equity||||||||
|1. Capitalizing of capital reserves||||||||
|(or to capital shares)||||||||
|2. Capitalizing of surplus reserves||||||||
|(or to capital shares)||||||||
|3．Making up losses by surplus||||||||
|reserves.||||||||
|4. Other||||||||
|(V). Special reserves||||||||
|||||-25,333.02|||-25,333.02|
|1. Provided this year||||||||
|||||299,375.65|||299,375.65|
|2．Used this term||||||||
|||||324,708.67|||324,708.67|
|（VI）Other||||||||
|IV. Balance at the end of this term|||||||5,941,402,748.40|
||754,010,400.00|138,953,250.09|2,118,935,346.56|10,848,700.83|602,356,402.65|2,316,298,648.27||

 Amount in last year
In RMB
|||
|-|-|
|Items|Amount in last year|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
|||Other Equity instrument|||||Other|||||
|||||||Less:||||||
||||||||Compre||Common risk||Total of owners’|
||Share Capital||||Capital reserves|Shares in||Surplus reserves||Attributable profit||
|||preferre|||||hensive||provision||equity|
|||d stock|Sustainable|Other||stock||||||
||||debt||||Income|||||
|I.Balance at the end of last year||||||||||||
||754,010,400.00||||138,953,250.09|||13,098,989.67|602,356,402.65|2,201,224,089.10|3,709,643,131.51|
|Add: Change of accounting||||||||||||
|policy||||||||||||
|Correcting of previous errors||||||||||||
|Other||||||||||||
|II.Balance at the beginning of||||||||||||
||754,010,400.00||||138,953,250.09|||13,098,989.67|602,356,402.65|2,201,224,089.10|3,709,643,131.51|
|current year||||||||||||
|III.Changed in the current year||||||||||||
|||||||||||22,564,563.07|22,564,563.07|
|（I）Total comprehensive||||||||||||
|||||||||||22,564,563.07|22,564,563.07|
|income||||||||||||
|(II) Investment or decreasing of||||||||||||
|capital by owners||||||||||||
|1．Ordinary Shares invested by||||||||||||
|shareholders||||||||||||
|2．Holders of other equity instr||||||||||||
|uments invested capital||||||||||||
|3.Amount of shares paid and||||||||||||
|accounted as owners’ equity||||||||||||
|4．Other||||||||||||
|（III）Profit allotment||||||||||||
|1.Providing of surplus reserves||||||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||
|-|-|-|-|-|-|-|
|2．Allotment to the owners (or|||||||
|shareholders)|||||||
|3．Other|||||||
|(IV)Internal transferring of|||||||
|owners’ equity|||||||
|1. Capitalizing of capital|||||||
|reserves (or to capital shares)|||||||
|2. Capitalizing of surplus|||||||
|reserves (or to capital shares)|||||||
|3．Making up losses by surplus|||||||
|reserves.|||||||
|4. Other|||||||
|(V) Special reserves|||||||
|1. Provided this year|||||||
||||549,654.39|||549,654.39|
|2．Used this term|||||||
||||549,654.39|||549,654.39|
|（VI）Other|||||||
|IV. Balance at the end of this|||||||
||754,010,400.00|138,953,250.09|13,098,989.67|602,356,402.65|2,223,788,652.17|3,732,207,694.58|
|term|||||||

Legal Representative: Zheng Bin Person in charge ofaccounting：Pu Yangshuo Accounting Dept Leader: Zhao Jiama
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 III.Company Profile
Hangzhou Steam Turbine Co., Ltd. (the Company) was incorporated as a joint stock limited company exclusively promoted by Hangzhou Steam Turbine& Power Group Company Limited (“HSTG”) approved by the Securities Regulatory Commission of the State Council with the Document SRC[1998] No. 8 by offering domestically listed foreign currency ordinary shares (B Shares), with registration date: April 23, 1998, Headquartered in Hangzhou, Zhejiang Province. The company now holds a unified social credit code for the 913300007042026204 business license, TheCompany’s registered capital is increased to RMB754.0104 million with total capital share of 754.0104 million shares (face value RMB1.00). Among which state-owned legal person shares were 479.8248 million shares and 274.1856 million shares of current B shares. The shares were issued and listed for trading in Shenzhen Stock Exchange on April 28, 1998.
The scope of main businesses of the Company: The design, manufacturing, and service of steam turbine, gas turbine, other rotating and reciprocate machinery and auxiliary equipment, and spare parts and components. Wholesale, import& export, and service of packaged equipment in electric power supply, industrial driving, and industrial turbine, Energy Conservation and environmental protection project general contracting.
24 subsidiaries including Zhejiang Steam Turbine Packaged Technologies Co., Ltd., Hangzhou Zhongneng Steam Turbine Power Co., Ltd., Hangzhou Steam Turbine Casting Co., Hangzhou Steam Turbine Auxiliary Co., Ltd., Hangzhou Steam Turbine Machinery& Equipment Co., Ltd., Zhejiang Turbine Import& Export Co., Ltd., and Hangzhou Steam Turbine Industry Co., Ltd., were consolidated to the Financial Statements. For details of changing consolidation range and equity position please go to the Notes to the Financial Statements.
IV. Basis of compiling the finance report
(1) Basis of compiling
The Company adopts perpetual operation as the basis of financial statements.
(II) Assessment on perpetuation
No issue or situation, in 12 months since the end of report period, composes major doubt on the perpetuation assumption of the Company.
V. Principal Accounting Policies and Estimations
Principal Accounting Policies and Estimations
Important prompt: The Company utilized detailed accounting polices and estimations on providing of bad debt provisions, fixed asset depreciation, intangible asset amortization, recognition of revenue, and so forth, according to its business practices.
Important prompt:
1. Statement of compliance to the Enterprise Accounting Standard
The finance report produced by the Company is accordance with the Enterprise Accounting Standard, and reflects theCompany’s financial state, business performance and cash flow frankly and completely.
2. Fiscal year
The Company uses the calendar year for its fiscal year. A fiscal year is from January 1 to December 31.
3. Operational period
TheCompany’s relatively shorter operational period, which is 12 months, and is used as division of liquidity of assets and liabilities.
4. Standard currency for bookkeeping
The Company uses Renminbi (RMB) as the standard currency for book keeping.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 5. Accounting treatment of the entities under common control and different control
1. Treatment of entities under common control
Assets and liabilities acquired in merger of entities are measured at book values at the date of merger. The difference between the net book value of asset and the offered price (or total of face value of shares issued) will be adjusted into capital reserves; when the capital reserves is not enough to reduce, it will be adjusted into retained profit.
2. Treatment of entities under different control
The difference of takeover cost over the fair value of recognizable net asset of the acquired entity is recognized as goodwill at the day of takeover; in case the takeover cost is lower than the fair value of recognizable net asset of the acquired entity, the measuring process over the recognizable asset, liabilities, contingent liabilities, and takeover cost, shall be repeated, if comes out the same result, the difference shall be recorded into current income account.
6. Method for preparing the consolidated financial statements
The parent company puts all of its subsidiaries under its control into the consolidated financial statements. The consolidated financial statements are prepared according to the “Enterprise Accounting Standard No. 33– Consolidated Financial Statements”, basing on the accounts of the parent company and the subsidiaries, and after adjusting the long-term investment equity in the subsidiary on equity basis.
7. Recognition of cash and cash equivalents
Cash equivalent refers to the investment held by the Company with short term, strong liquidity and lower risk of value fluctuation that is easy to be converted into cash of known amount.
8. Foreign currency trade and translation of foreign currencies
1. Translation of foreign currency
Foreign currency trades are translated into RMB at the rate of the day when the trades are made. Those balances of foreign currencies and monetary items in foreign currencies are accounted at the exchange rate of the balance sheet date. Exchange differences, other than special loans satisfying the conditions of capitalization, are accounted into current income account. Non-monetary items in foreign currencies and on historical cost are translated at the rate of the trade day. Non-monetary items in foreign currencies and on fair value are translated at the rate of the day when the fair value is recognized, where the differences are accounted as gain/loss from change of fair value. 2. Translation of foreign currency financial statements
Asset and liability items in the balance sheet are translated basing on the exchange rate of the balance sheet date;Owners’ equities other than Retained Profit are translated at the exchange rate of the date when the trade happened. Income and expense items in the income statement are translated at the similar rate of the date when the trade happened. Differences generated by the above translating of foreign currencies are demonstrated separately under theowners’ equity in the balance sheet.
9. Financial instruments
1. Type of finance asset and finance debt Finance assets fall into four categories at initial recognition: financial asset appointed to be measured at fair value with their changes are accounted into current gain/loss accounts(including transactional finance asset and financial asset appointed to be measured at fair value with their changes are accounted into current gain/loss accounts), transactional financial assets, debt and account receivable, finance asset saleable.
Finance debts fall into two types at initial recognition: financial debt appointed to be measured at fair value with
their changes are accounted into current gain/loss accounts(including transactional finance debt and financial debt
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 appointed to be measured at fair value with their changes are accounted into current gain/loss accounts), other finance debt.
2. Basis of recognition and accounting of finance asset and finance debt When the Company is one part of the finance instrument contract, one finance asset or debt is recognized. When on recognizing initially finance asset or debt, it is measured by fair value, for the finance asset or debt which appointed to be measured at fair value with their changes are accounted into current gain/loss accounts, the related transaction expenses are directly accounted into current gain and loss; for other finance asset and debt, the related transaction expenses accounted into the initial recognition account. The Company future measures finance asset by fair value without deducting future possible transaction fee but with exception: (1) Due investment, debt and account receivable are measured by actual interest rate according to the amortized costs. (2) Equity instrument investment which have no quote in active market and which fair valuecan’t be measured reliably, and its derived finance assets which are connected with the equity instrument and which are summarized through the equity instrument, are measured by cost. 2. Basis of recognition and accounting of finance asset and finance debt When the Company is one part of the finance instrument contract, one finance asset or debt is recognized. When on recognizing initially finance asset or debt, it is measured by fair value, for the finance asset or debt which appointed to be measured at fair value with their changes are accounted into current gain/loss accounts, the related transaction expenses are directly accounted into current gain and loss; for other finance asset and debt, the related transaction expenses accounted into the initial recognition account. The Company future measures finance asset by fair value without deducting future possible transaction fee but with exception: (1) Due investment, debt and account receivable are measured by actual interest rate according to the amortized costs. (2) Equity instrument investment which have no quote in active market and which fair valuecan’t be measured reliably, and its derived finance assets which are connected with the equity instrument and which are summarized through the equity instrument, are measured by cost. The Company conduct successive measure of finance debt according to amortized cost by actual interest rate with exception as following: (1) finance debt which appointed to be measured at fair value with their changes are accounted into current gain/loss accounts, is measured at fir value without deducting possible future transactional fee at settlement; (2) Equity instrument investment which have no quote in active market and which fair valuecan’t be measured reliably, and its derived finance assets which are connected with the equity instrument and which are closed off through the equity instrument, are measured by cost. (3) finance debt sponsorship contracts which are not appointed to be measured at fair value with their changes are accounted into current gain/loss accounts, or debt agreements at rate lower than market rate and which are not appointed to be measured at fair value with their changes are accounted into current gain/loss accounts, are measured at the higher value between the optimal estimated value payable according to current obligations and the surplus value from which the initial recognition value deduct the accumulated amortized amount according to the actual interest rate.
Gain or loss from fluctuation of financial assets or liabilities are handled at the following ways, except for relating to hedge instrument.
(1) Gain or loss from fluctuation of fair value of financial assets or liabilities and accounted into current gain/loss account, are accounted into gain/loss of fluctuation of fair value. Interests or cash dividend received in the period of holding these assets are recognized as investment gains. When they are disposed, the difference between the amount actually received and initially booked value is recognized as investment gains, and adjust the gain/loss from fair value fluctuation.
(2) Fluctuation of fair value of sellable financial assets accounted into capital reserves; interests gained at actual interest rate are accounting into investment gains; the cash dividend received from sellable instrument investment, are accounted into investment gains when distributed; At disposal of these investment, the difference between actual amount received and book value are recognized as investment gains after deducting of accumulated change of fair value which are originally accounted into capital reserves.
As soon as the contract rights of acquiring the cash flow of particular financial asset have been terminated or almost all of the risks and rewards attached to the financial asset have been transferred, recognition of the financial asset is terminated; as soon as the current liabilities attached to the financial liability have been completely or partially relieved, recognition of the financial liability or part of is terminated.
3. Basis of recognition and accounting of financial asset transferring
The Company stop recognizing the finance asset which risks and remuneration of ownership are transferred to the receiver; and continue to recognize the transferred finance asset which risks and remuneration of ownership are
kept, and recognize the value as one finance debt. For the finance assets which risks and remuneration of
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 ownership are not transferred or kept, the Company recognize them as following: (1) stop recognizing the finance asset which are given up the control; (2) continue to recognize the finance asset and related finance debt according to the extend which involved into the transferred finance asset for the finance asset which are not given up control. The Company measured the surplus between the following two values for the transferred finance assets which fulfill the stop recognition requirements into current gain or loss: (1) Account value of the transferred finance asset; (2) Consideration plus the accumulated fair value changes which were accounted directed into ownership rights. For the transferred finance assets which partly fulfill the stop recognition requirements the Company amortized the stopped recognition part and the not-stopped recognition part of the account value of the whole transferred finance asset, and account the surplus between the following two values into current gain or loss: (1) Account value of the stopped recognition part; (2) consideration plus the corresponding stopped recognition part of the accumulated fair value changes which were accounted directed into ownership rights.
4. Recognition of fair value of financial assets and liabilities
The Company utilizes evaluation technologies supported by sufficient data and information to recognize the fair values of financial assets and liabilities. Values inputted to the evaluation technology are divided into following levels and used in sequence:
(1) Level 1 input: unadjusted quotations obtained from an active market of the similar asset or liability at the date of measurement;
(2) Level 2 input: values of the asset or liability observable, directly or indirectly, other than level 1 input, including: quotation of similar asset or liability in an active market; quotation of similar asset or liability in an non-active market; other observable value other than quotations, i.e. observable interest or gain curves in normal intervals of quotations.
(3) Level 3 input: non-observable input value of the asset or liability, including interest rates which are not observable or not testified by observable market data, fluctuation of stock prices, future cash flow of disposal liabilities undertaken from merger of entities, or financial predictions upon data itself.
5. Impairment test and impairment reserves plan
(1) The Company conduct impairment test to the finance asset other than which appointed to be measured at fair value with their changes are accounted into current gain/loss accounts on balance sheet day. Impairment provision is provided as long as evidence showing that impairment has happened to the financial asset.
(2) In dealing with major financial assets such as investment hold-to-mature, loans, and receivables, the Company conduct independently impairment test for single finance asset. Impairment tests are conducted with those of the finance asset composition which have similar credit risk characteristics; for the non impairment assets which are tested independently, the Company conduct the impairment test with those of the finance asset composition which have similar credit risk characteristics. The balance of book value over current value of expected future cash flow is recognized as impairment loss.
(3) Objective evidences of impairment on sellable financial assets 1) Objective evidences supporting the impairment of investment on sellable liability instruments are: a. Material financial dilemma with the debtor; b. Violating of the contract by the debtor, e.g. overdue of payment for interests or principal; c. Compromise made to the debtor who is in financial crisis with consideration of financial or legal factors; d. Possible bankruptcy or financial restructuring of the debtor; e. The liability instrument is not able to be traded in an active market for the debtor is in material financial dilemma; f. Other circumstances that are showing that impairment has already occurred.
2) Objective evidence showing that impairment has already occurred on sellable equity instruments are: significant or non-temporary fall of fair value, the invested entities suffers from material negative situations in aspects of technical, market, economy, or legislation environment. The Company performs tests on investments on sellable equity instruments individually on the balance sheet day. For investment on equity instruments measured on fair value, if the fair value on the balance sheet day is lower than the cost by50% (included), or lower than the costs for successively 12 months (included), impairment is recognized; If the fair value is lower than the cost by more than20% (included), but higher than50%, or lower than the cost for successively 6 months (included) but not more than 12 months, the Company will determine if impairment occurred with consideration of other factors, e.g. fluctuation of prices. For those equity instruments on cost basis, the Company will decided about impairment with consideration of the investedentities’ situations in aspects of technical, market, economy, or legislation
environment.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 When impairment occurred with a sellable financial asset, the accumulated losses caused by decreasing of fair value which have originally been written intoowners’ equity shall be carried over to current gain/loss account. If practical evidence showing that the value of a particular financial asset has recovered in value after a impairment loss has been recognized and practically related to the issues occurred after recognition of the loss, the impairment loss recognized shall be restored and accounted into current gain/loss. Impairment loss of sellable equity investment instrument will be restored toowners’ equity when the fair value has increased afterward. When impairment occurs on sellable equity instrument on cost basis, the balance between its book value and the current value of the predictable future cash flow upon current market gain rate, is recognized as impairment loss and recorded to current gain/loss account. It will not be written back in subsequent years.
When impairment occurred with a sellable financial asset, the accumulated losses caused by decreasing of fair value which have originally been written intoowners’ equity shall be carried over to current gain/loss account. If practical evidence showing that the value of a particular financial asset has recovered in value after a impairment loss has been recognized and practically related to the issues occurred after recognition of the loss, the impairment loss recognized shall be restored and accounted into current gain/loss. Impairment loss of sellable equity investment instrument will be restored toowners’ equity when the fair value has increased afterward.
10. Receivable accounts
(1) Recognition and providing of bad debt provision on individual receivable account with large amount
Basis of recognition or standard amount of
Accounts take over10% of the book balance of receivable accounts
individual account with large amount
Impairment test performed individually, bad debt provision will be provided at Basis of bad debt provision
the difference of expected cash flow lower than the book value.
2.Recognition and providing basis of bad debt reserves for group of receivable accounts with similar characteristics of credit risks
|||
|-|-|
|Name of the Group|Basis of bad debt provision|
|Group by age analysis|Age analysis method|
|Combined range of association|Other method|

Bad debt profisions are provided on age analyze basis in the protfolio
||||
|-|-|-|
|||Rate of provision on other receivable|
|Age|Rate of provision on receivable account||
|||account|
|Within 1 year)included)|5.00%|5.00%|
|1－2 years|10.00%|10.00%|
|2－3 years|30.00%|30.00%|
|3－4 years|60.00%|60.00%|
|4－5 years|80.00%|80.00%|
|Over 5 years|100.00%|100.00%|

Bad debt provisions are provided on percentage basis in the portfolio
Not applicable
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Bad debt provisions are provided on other basis in the portfolio
Not applicable
(3)Receivable accounts with minor amount but bad debt provisions are provided individually
|||
|-|-|
||When there is significant difference between the current value of future cash flow of|
|Basis of providing bad debt individually||
||the receivable account and the current value of future cash flow of the group|
||Impairment test performed individually, bad debt provision will be provided at the|
|Basis of bad debt provision||
||difference of expected cash flow lower than the book value.|

11.Inventories
Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Inventory classification
Inventories include saleable finished goods or merchandise, product-in-process , consumption material and goods in manufacturing procedure or working procedure.
(2) Pricing of inventory to be delivered
Pricing basis:
Delivered out materials are accounted by weighted average method, issued out finished products are accounted at individual price.
(3) Recognition of realizable net value of inventory and providing of inventory impairment provision
At the balance sheet day, inventories are measured at the lower of costs and cashable net values, the individual difference between the cashable net value and cost are provided as inventory impairment provision. For finished product, merchandise, saleable material and other saleable merchandise inventory, their cashable net values are recognized by their estimated sale price in normal operation deducting estimated sale expenses and related taxes; for material inventory which need processing, it cashable net value are recognized by the estimated sale prices of its finished products in normal operation deducting the estimated cost, sale expenses and related taxes due to the end of processing; At the balance sheet day, for inventory item which part has contract price and part has no contract price, the cashable net value is accounted separately, and recognize the inventory impairment provision or returnable cash..
(4) Inventory system
Inventory system: perpetual inventory system
(5) Amortization of low-value consumables and packaging materials
1.Low price consumable
Basis of amortizing: one-off
2.Packaging materials
Basis of amortizing: one-off
12. Long-term equity investment
1. Recognition of common control and substantial influence
According to the contract, if the investedenterprise’s main finance and operation policy need to be agreed by the
other investing party, the investment is common control investment; if only have participating decision rights in
investedenterprise’s main finance and operation policy but have no own control or common control with other
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 investing part, the investment is investment with substantial influence.
2. Recognition of initial investment costs
(1) For the long-term equity investment formed by corporate merger under common control, if it is the long-term equity investment obtained from the corporate merger by paying cash, transferring non-cash asset, bear liability and issuing equity securities, the share of book value of owner's equity of the merged party on the merger date shall be taken as the initial investment cost. The asset reserve is adjusted according to the difference between the initial investment cost of long-term equity investment and the book value of paid combined consideration or issued securities; if the capital is not enough for deduction, the remain earnings are adjusted.
Recognition of “one-off” trade when long-term equity investment is composed by merger of entities under common control by multiple steps.
Transactions under an “one-off” trade are accounted as a common trade of ownership.
Transactions which are not “one-off” trades are recognized for their initial investment cost basing on the share of book value of net asset in the consolidated financial statement of the entities acquired. Balance between the initial investment cost and the book value of the long-term equity investment before merger and the premium paid for the new shares after merger, is adjusted to capital reserves; when the capital reserve is not enough to offset, retained profit shall be adjusted thereof.
(2) For the long-term equity investments formed by merger of enterprises under different control, the initial investment cost is recognized by the fair value of combined consideration on purchasing day and related expenses. Long-term equity investment formed by acquisition of entities under different control by trade in multiple stages are accounted separately in the financial statements and consolidated financial statements.
1) In individual financial account, the sum of book value of original equity investment plus new investment cost is recognized as the initial investment cost on cost basis.
2) Recognition of “one-off” trade in consolidated financial statements
Transactions under an “one-off” trade are accounted as a common trade of ownership. Transactions which are not “one-off” trades are re-measured for their fair value at the day of acquisition. Balance between the fair value and the book value of the long-term equity investment is adjusted to current investment gains; other gains from equity on equity basis before the acquisition day are written over to current gains of at the day of acquisition, but not the gains from re-calculating of changes in net liability or asset by the invested entity.
(3) Formed by means other than entity merger:
Acquired by cash payment– initial investment cost is the actual amount of payment;
Acquired by issuing of equity certificates– initial investment cost is the fair value of equity certificate issued; Acquired by debtor restructuring– initial cost recognized as according to the Enterprise Accounting Standard No.12– Debtor restructuring;
Acquired by trading of non-monetary asset - initial cost recognized as according to the Enterprise Accounting Standard No.12– Trade of non-monetary assets;
3. Subsequent measurement and recognition of gain/loss
Cost basis is adopted in accounting of long-term equity investment in entities under substantial control of the Company; while equity basis is adopted in accounting of investment in affiliates and joint-ventures.
4. Treatment of disposal of subsidiaries by stages till losing of control power
(1) Individual account
At disposal of equity shares, the balance between book value and actual consideration received is recorded to current gain/loss account.
When the retained share equity is composing major influence or joint control with other parties on the invested entity, accounting will be on equity basis;
When none of substantial control, joint control, or major influence on the entity, it will be recognized as sellable
financial asset and accounted on fair value.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 (2) Basis of Consolidated Financial Statements
1) Losing of controlling power on a subsidiary through disposal of equity by multiple trades, and not recognized as “one-off” trade:
Before losing of control power, the balance of disposal consideration and the share of net asset attributable to the Company on continued basis since purchasing or merger, is adjusted to capital reserves (capital premium), whereas if the capital premium is not enough to offset the amount, retained profit will be offset at corresponding amount.
At losing of control power over a former subsidiary, the retained equity shares shall be re-calculated according to the fair value at the day of losing power. Sum of the consideration obtained from disposal and fair value of the retained equity shares, less the share of net asset attributable to the Company on continued basis since purchasing or merger, is accounted into investment gains of the period when the control power is disposed, and goodwill shall be offset meanwhile. Other gains related to the equities in formal subsidiary shall be written over to current investment gains at the period when control power was disposed.
2) Losing of controlling power on a subsidiary through disposal of equity by multiple trades, and recognized as “one-off” trade:
The multiple trades are treated as one trade that causes losing of control power on a subsidiary. However, the balance between the consideration received from each trade and corresponding share of net asset is recognized as other gains in the consolidated accounts, and transferred collectively to gain/loss account of the period in which the control power was lost.
13. Fixed assets
1. Conditions for fixed asset recognition
Fixed assets is defined as the tangible assets which are held for the purpose of producing goods, providing services, lease or for operation& management, and have more than one year of service life. Fixed assets are recognized at satisfying of great possibility of benefit inflow and costs are accountable.
2. Depreciation
||||||
|-|-|-|-|-|
|Categories|Basis of depreciation|Depreciation age (year)|Retain value rate|Annual depreciation ratio|
||Straight average on||||
|Houses & buildings||20-30|4|4.8-3.2|
||period||||
||Straight average on||||
|Equipment & machinery||8-15|4|12-6.4|
||period||||
|Transportation|Straight average on||||
|||4-8|4|24-12|
|equipment|period||||
||Straight average on||||
|Office equipment||5|4|19.2|
||period||||

14. Construction in process
1. Construction in process is recognized on the basis of characteristics: very possible economic benefit flow in, cost can be measured reliably. Since the date when the construction in process reaches its useful status as expected, the construction in process is measured by the happened cost Since the date when the construction in process reaches its useful status as expected.
2. When the construction in process reaches its useful status as expected, it is transferred into fixed asset at actual
cost. If the construction in process has reached useful status but with completion of project settlement process, it is
transferred to fixed asset at the value estimated, and adjustment will happen after completion of project settlement
process but no adjustment on depreciation provided previously.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 15. Loan expenses
1. Capitalizing of loan expenses
Loan expenses occurred in the Company, which can be categorized to purchasing or construction of assets satisfying the conditions of capitalization, shall be capitalized and accounted into capital costs; while other loan expenses are recognized as expenses and recorded into current income account.
2. Capitalization period of loan expenses
(1) Capitalization started as soon as all of these conditions are satisfied: 1) Capital expenditures have occurred; 2) Loan expenses have occurred; 3) Necessary purchasing or construction processes have been started to make the asset usable or sellable.
(2) If irregular interruption occurred in the purchasing or construction process of the assets satisfying the capitalizing conditions, and suspended for over successive three months, capitalizing of loan expenses is suspended; loan expenses occurred during the suspension period are recognized as current expenses until the purchasing or construction process resumes.
(3) Capitalizing of loan expenses is terminated as soon as the asset satisfying the capitalizing conditions reaches the state of usable or sellable as expected.
3. Rates and amounts of loan expense capitalization
Special loans raised for purchasing or construction of assets satisfying the conditions of capitalization, interest to be capitalized will be the actual interest expenses occurred in the current period of loan (including the discount, premium, or amortizing decided on actual interest rate basis), less the interest income from the unused loans in bank account or provisional investment gains; common loans used for purchasing or construction of assets satisfying the conditions of capitalization, the interest to be capitalized will be the weighted average of balance over special loans multiply capitalization rate of common loans.
16. Intangible assets
（1）Pricing Method, service life and impairment test
1. Intangible assets are land using rights, patents, and non-patent technologies, which are measured at cost basis. 2. For intangible assets with limited useful life, during the use life it is amortized according to the anticipating implementation method of the economic benefit of the intangible asset systematically and reasonably. Ifcan’t recognize the anticipating implementation method, the straight basis is deployed.
|||
|-|-|
|Items|Amortiing years|
|Land using right|50|
|Patent and Special technology|5-20|
|Software|5|

(2) Accounting policy for internal research and development expenditure
Expenditures of internal researching projects are accounted into current term gain and loss when happens. The development period expenditures are recognized as intangible assets when fulfill following conditions: (1) The intangible asset is completed and technically possible to be used or sold; (2) With intention to complete the intangible asset for purpose of use or sale; (3) Evidence showing that there are markets or the products produced with using of the intangible asset, or markets of the intangible asset itself, by which the intangible asset may produce financial benefits. Intangible assets used inside the Company must be approved for their usable characters.
(4) Developing of the intangible assets are supported by sufficient technical, financial, and other resources, and
the intangible assets can be used or sold. (5) Expenditures occurred in developing of the intangible asset may be
reliably measured.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 17. Impairment of partial long-term assets
For those long-term assets such as equity investment, fixed assets measured on cost basis, construction-in-process, intangible assets with limited service life, their recoverable amount shall be evaluated as soon as there was evidence indicating impairment at the balance sheet day. For intangible assets such as goodwill from merger or intangible assets with uncertain service lives, impairment test is performed each year whatever there is evidence of impairment or not. Impairment test on goodwill is performed on combination of related assets.
When the result of prediction shows that the recoverable amount is lower than its book value, the balance shall be provided impairment provision and accounted into current gain/loss.
18. Long-term amortizable expenses
Long-term amortizable expenses which have been paid but with amortizing period over 1 year (not included). Long-term amortizable expenses are recorded at actual amount occurred, and straight amortized to stipulated periods. In case a long-term expense was not benefiting the succeeding periods, then the balance of the account shall be transferred over to current income account.
19.Employees’ wage
1. Accounting of short-term wages
In the fiscal period when an employee is providing services, short-term wages actually occurred is recognized as liability, and recorded into current gain/loss account or cost of related asset.
2.Accounting of stipulated beneficiary plan is on following steps:
1) On basis of expected accumulation of welfare, estimations on population variables and financial variables, calculating of liabilities from stipulated beneficiary plan, and recognition of the period of related liabilities, are performed on basis of non-bias and accordance actuary. Meanwhile, discount is performed on the liabilities from stipulated beneficiary plan to recognize the current value and service cost of the liabilities from the stipulated beneficiary plan.
2) When there is asset involved in the stipulated beneficiary asset, the deficit or premium from the balance of the current value of liabilities of stipulated beneficiary plan over their fair values is recognized as its net liability or net asset. When there is a premium with a stipulated beneficiary plan, the lower one between the premium and the upper limit of the asset is recognized as the net asset of such stipulated beneficiary asset;
3) At end of period,employees’ wages from stipulated beneficiary plan are recognized by three parts including service cost, net interest of net liability or net asset, and recalculated net asset or liability variation. The first two are recorded into current gain/loss or related asset cost, the third is recorded to other gains, which will not be written back to gain/loss in successive fiscal periods, but the amount can be transferred with the range of equity. 3. Accounting of dismissing welfare
Welfares for employees who are dismissed, the earlier one of the following is recognized as employee wage liability, and recorded to current gain /loss:
(1) When the Company cannot, on its own call only, retrieve the dismissing welfare provided by dismissing of service plan or suggestion;
(2) When the costs or expenses related to restructuring involved in the dismissing welfare are recognized by the Company.
4. Accounting of other long-termemployees’ welfares
As of long-term welfares provided to the employees, those which satisfy conditions of the stipulated saving plan are treated according to related regulations of stipulated saving plan; those which other than the aforesaid, are treated according to the stipulated beneficiary plan. In viewing of simplifying accounting treatment, employee wage costs are recognized as service costs, the net amounts of interests of other long-term welfare net liability or
asset, along with recalculated variations of the both are recorded to the related gain/loss or cost of related asset.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 20. Expected liabilities
(1) When it is very much likely to cause economic interests which can be reliably calculated outflow from the company to fulfill the obligation which is due to giving security outside, contentious matter, quality guarantee of products, onerous contract and other contingency, the company will regard the obligation as anticipation liabilities.
(2) The company will make an initial measurement of anticipation liabilities according to needed expense of best estimation when fulfilling related obligations and check the book value of anticipation liabilities on the balance sheet date.
21.Revenue
Whether the company needs to comply with the disclosure requirements of the particular industry
No
1. Recognizing of revenue
(1) Sales of goods
Sales income is recognized when all of these conditions are satisfied: (1) Major risks and rewards attached to the goods have been transferred to the purchaser; (2) The Company holds neither successive management power which is normally attached to ownership, nor effective control, over the goods which have been sold out; (4) Amount of income may be reliably measured; (5) when the costs, occurred or will occur, may be measured reliably.
(2) Providing of services
At balance sheet day, those service trades (simultaneously satisfying the requirements of those: income can be measured reliably, related economic benefit will flow in very possibly, transaction procedure can be confirmed reliably, happened and happening cost can be measured reliably) which can be reliably estimated are recognized at the percentage of completion, and progress of completion of service is decided by the portion of costs occurred over the estimated total costs. At balance sheet day, those service trades which can not be reliably estimated, if the happened services cost will be compensated, the services income are recognized according to happened service cost and transited to service cost according to same amount; if the happened services cost will not be compensated, the happened services cost are accounted into currentterm’s gain or loss and the services income will not be recognized.
(3) Giving of asset using rights
Income from giving of assets is recognized when satisfying requirements: related economic benefit flows in very possibly, income can be measured reliably. Amount of interest income is calculated according to the time and actual interest rate of the monetary capital is used by other party. Income of using fee is calculated upon the charge period and calculation provided by the related contract or agreement.
(4) Construction contracts
1) When the result of the construction contract is able to be evaluated reliably at the balance sheet date, the income and cost of the contract are recognized on completion percentage basis. If the result of the construction contract is not able to be evaluated reliably, but the contract cost may be recovered, the income is recognized at the cost actually recovered, and the cost of the contract is recognized as contract expenses of the current period when it is occurred.
2) When all of the following conditions were satisfied, the result of a fix-amount contract is regarded as can be evaluated reliably: the total income of the contract may be measured reliably, there is great possibility that the financial benefit in relation with the contract will inflow, the actual contract costs may be identified and measured
clearly and reliably, the construction progress and the cost to occur are able to be measured reliably. When all of
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 the following conditions are satisfied, the result of a cost-plus-commission contract is regarded as can be evaluated reliably: there is great possibility that the financial benefit in relation with the contract will inflow, the actual costs may be identified and measured clearly and reliably.
3) Contract progress is recognized at the ratio of accumulative actual cost on the predicted complete cost. 4) In case the expected total cost is greater than the total income, the expected loss will be recognized as expense of the current period. If the construction is in process, the balance is accounted as inventory impairment provision; if the contract is not executed, the balance is accounted as expected liability.
2. Practical basis for recognition of revenue
Particular methods for recognition of revenue. The Company is mainly engaged in designing, manufacturing, sales, and service of steam turbines and gas turbines falling in the range of rotating and reciprocating machinery, and parts. Recognition of sales in the country shall satisfy: products had been delivered to the buyer and the amount had been fixed. Payment was received or documents received with great possibility of cash inflow. And the cost of the products is able to be measured appropriately. Recognition of sales outside the country shall satisfy: The goods had been filed by the custom with bill of lading obtained. The amount had been fixed, and payment was received or documents received with great possibility of cash inflow. And the cost of the products is able to be measured appropriately.
22. Government subsidy
1. Recognition basis and accounting of asset-related government subsidy
Government subsidies to the Company for purchasing or acquiring by other means of long-term asset are asset-related government subsidies. They are recognized as deferred income and amortized straightly to their service lives and accounted in current gain/loss. Whereas government subsidy measured by nominal amount are recorded to current gain/loss account.
2. Recognition basis and accounting of income-related government subsidy
Government subsidies other than asset-related subsidies are recognized as income-related government subsidies. Those, which are used to cover costs or losses in subsequent periods, are recognized as deferred income and accounted to current gain/loss to the periods of related expenses. Those, which are used to makeup expenses or losses already occurred, are recorded to current gain/loss account.
23. Deferred income tax assets/ deferred income tax liabilities
1. Deferred income tax liabilities or assets are recognized at proper rate in the term of retrieving the assets or paying the liabilities according to difference (for not recognized assets and liabilities which tax basis can be recognized, the difference is between the tax basis and the book value) between book value of the assets or liabilities and the tax basis.
2. Deferred income tax assets are recognized limitedly by the income tax which very possibly deduct deductible temporary difference. At balance sheet day, the not-yet recognized deferred income tax assets in previous fiscal term are recognized if have evidence to prove there is enough income tax very possibly to deduct deductible temporary difference.
3. At the balance sheet day, verification will be performed on the book value of differed income tax assets. If it is not possible to obtain enough taxable income to neutralize the benefit of differed income tax assets, then the book value of the differed income tax assets shall be reduced. Whenever obtaining of taxable income became possible, the reduced amount shall be restored.
4. Current income tax and differed income tax are accounted into current gain/loss account as income tax expenditures or gains, but exclude the following income taxes: (1) Merger of enterprises; (2) Transactions or events recognized directly inowners’ equity.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 24. Lease
Accounting of operational lease
When the Company is the leasee, the amount is recorded to asset cost or recognized as gain/loss of current period on straight basis to the periods of lease. Initial direct expenses are accounted into current gain/loss. Contingent rentals are recorded to current gain/loss at actual occurrence.
When the Company is the leaser, the amount is recorded to current gain/loss at straight basis to the periods of lease. Initial direct expenses are recorded to current gain/loss other than those with greater amount which are capitalized and recorded to gain/loss of different periods. Contingent rentals are recorded to current gain/loss at actual occurrence.
VI. Taxation
1. Main categories and rates of taxes
||||
|-|-|-|
|Category of taxes|Tax base|Tax rate|
|VAT|Sales of goods or providing of taxable labor service|17%|
|City maintenance and|||
||Turnover tax payable|7%|
|construction tax|||
|Enterprise income tax|Amount of income taxable|15%、25%[Notes]|
|Educational surcharge|Turnover tax payable||
|||3%|
|Local education additional|Turnover tax payable||
|||2%|
||For those on price basis, taxes are paid at 1.2% of the balance of||
|House tax|original value of the property after deducting of 30%; for those on|1.2%、12%|
||rental basis, taxes are paid at 12% of the rental.||

Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rate
|||
|-|-|
|Name|Income tax rate|
|Hangzhou Steam Turbine Co., Ltd.|15%|
|Hangzhou Zhongneng Steam Turbine Power Co., Ltd.|15%|
|Zhejiang Steam Turbine Packaged Technology Development Co.,||
||15%|
|Ltd.||
|Hangzhou Steam Turbine Casting Co., Ltd.|15%|
|Zhejiang Huayuan Steam Turbine Machinery Co.,Ltd.|15%|
|Hangzhou Guoneng Steam Turbine Engineering Co.,Ltd.|15%|
||Hangzhou Zhongneng Steam Turbine Power (Indonesia) Co.,|
|Hangzhou Zhongneng Steam Turbine Power( Indonesia)Co., Ltd|Ltd. registered in Indonesia overseas subsidiaries, the applicable|
||local relevant tax laws and regulations|
|Other Subsidiary（Domestic）|25%|

(II) Preferential tax
1. According to the document “Notice for Qualification of High-tech Enterprises”(GKHZD〔2015〕No.29) issued
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 by Department of Science and Technology High-tech Development Center, the Company along with Hangzhou Zhongneng Steam Turbine Power Co., Ltd. and Zhejiang Packaged Technologies Development Co., Ltd.– subsidies of the Company, were qualified as high-tech enterprises for term of three years. Therefore they enjoy15% of tax for 2016.
2. According to the document “Notice for Qualification of High-tech Enterprises”(GKHZD〔2016〕No.149) issued by Department of Science and Technology High-tech Development Center, Hangzhou Steam Turbine Casting Co.,Ltd– subsidies of the Company, were qualified as high-tech enterprises for term of three years. Therefore they enjoy15% of tax for 2016.
3. According to the document “Notice for Qualification of High-tech Enterprises”(GKHZD〔2015〕No.36) issued by Department of Science and Technology High-tech Development Center, Zhejiang Huayuan Steam Turbine Machinery Co., Ltd. and Hangzhou Guoneng Steam Turbine Engineering Co., Ltd.– subsidies of the Company, were renewed or their qualifications as high-tech enterprises. Therefore they enjoy15% of tax for 2016.
VII. Notes to the Consolidated Financial Statements
1.Monetary Capital
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Cash in stock|204,146.76|326,226.09|
|Bank deposit|1,010,445,229.00|830,910,758.76|
|Other monetary fund|45,160,002.72|63,800,574.49|
|Total|1,055,809,378.48|895,037,559.34|
|Incl:Total of accounts saved overseas|3,256,410.89|4,796,746.67|

 Other statements
Other monetary fund composes of security for bank acceptance notes, RMB43,585,002.75 of security for Letter of credit, RMB1,575,000 of security for bank guarantee letter. Both under limitation of using.
2. Bills receivable
(1) Notes receivable listed by category
In RMB
||||
|-|-|-|
||End of term|Beginning of term|
|Items|||
|Bank acceptance|645,701,184.36|421,520,454.12|
|Commercial acceptance|50,387,954.04|58,195,867.50|
|Total|696,089,138.40|479,716,321.62|

(2) Notes receivable pledged by the Company at the period-end
In RMB
|||
|-|-|
|Items|Amount on pledge|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||
|-|-|
|Bank acceptance|22,970,000.00|
|Total|22,970,000.00|

（3）Notes receivable which had endorsed by the Company or had discounted and had not due on the balance sheet date at the period-end
In RMB
||||
|-|-|-|
||Amount of recognition termination at the|Amount of not terminated recognition at|
|Items|||
||period-end|the preriod -end|
|Bank acceptance|470,957,242.50||
|Total|470,957,242.50||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 3. Account receivable
（1）Detailed categories
In RMB
|||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|
||End of term|||||Beginning of term||||||
|Category|Book balance||Bad debt provision|||Book balance||Bad debt provision||Amount|Propor|
||||||Book value|||||||
||Amount|Proportion|Amount|Proportion||Amount|Proportion|Amount|Proportion||tion|
|Account receivables||||||||||||
|provided bad debt||||||||||||
||2,784,969,667.51|98.94%|972,672,126.99|34.93%|1,812,297,540.52|2,812,043,945.50|98.95%|941,870,597.18|33.49%|1,870,173,348.32||
|provision in credit||||||||||||
|risk groups||||||||||||
|Account receivable||||||||||||
|with minor||||||||||||
|individual amount||||||||||||
||29,819,607.69|1.06%|29,819,607.69|100.00%||29,819,607.69|1.05%|29,819,607.69|100.00%|||
|but bad debt||||||||||||
|provision is||||||||||||
|provided||||||||||||
|Total|2,814,789,275.20|100.00%|1,002,491,734.68|35.62%|1,812,297,540.52|2,841,863,553.19|100.00%|971,690,204.87|34.19%|1,870,173,348.32||

 Receivable accounts with large amount individually and bad debt provisions were provided
Not applicable
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Receivable accounts in the group on which bad debt provisions are provided on age basis
In RMB
|||||
|-|-|-|-|
||End of term|||
|Age||||
||Book balance|Bad debt provision|Proportion|
|Subitem Within 1 year||||
|Within 1 year|897,301,429.87|44,874,653.80|5.00%|
|Subtotal within 1 year|897,301,429.87|44,874,653.80|5.00%|
|1-2 years|516,378,722.74|51,637,872.29|10.00%|
|2-3 years|412,409,612.41|123,722,883.75|30.00%|
|Over 3 years|958,879,902.49|752,436,717.15||
|3-4 years|399,567,205.23|239,740,323.14|60.00%|
|4-5 years|233,081,516.26|186,465,213.01|80.00%|
|Over 5 years|326,231,181.00|326,231,181.00|100.00%|
|Total|2,784,969,667.51|972,672,126.99|34.93%|

 In the groups, accounts receivable adopting balance percentage method to withdraw bad debtprovision： Not applicable
In the groups, accounts receivable adopting other methods to accrue bad debtprovision:：
（2）Accrual period, recovery or reversal of bad debts situation
The current amount of provision for bad debts is RMB35,164,522.75 ; recovery or payback for bad debts Amount is RMB0.00.
(3)The current accounts receivable write-offs situation
In RMB
|||
|-|-|
|Items|Amount|
|Uncollectible amount|4,362,992.94|

 Of which the significant actual write-off accounts receivable:
In RMB
|||||||
|-|-|-|-|-|-|
||Nature of||||Arising from related|
||||Reason for|||
|Name|account|Amount written off||Verification procedures|transactions (Y/N)|
||||written off|||
||receivable|||||
|||||The examined and adopted to||
|China Air Separation Engineering Co., Ltd.|Goods|1,674,643.00|quality loss||No|
|||||Board of directors||
|Huaneng Energy saving Powergeneration|Goods|760,000.00|quality loss|The examined and adopted to|No|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||
|-|-|-|-|-|-|
|Co., Ltd.||||Board of directors||
||||Debt|The examined and adopted to||
|Tangshan Yanshan Steel Co.,Ltd.|Goods|623,280.00|||No|
||||Restructuring|Board of directors||
|Inner Mongolia Runbang Biogechnology||||The examined and adopted to||
||Goods|620,000.00|quality loss||No|
|Co., Ltd.||||Board of directors||
||||allowance|The examined and adopted to||
|Other|Goods|685,069.94|||No|
||||method|Board of directors||
|Total|--|4,362,992.94|--|--|--|

（4）Receivables account of the top five parties
|||||
|-|-|-|-|
|Name|Amount|Proportion(%)|Bad debt provision|
|Client 1|706,982,732.92|25.12%|321,311,615.97|
|Client 2|302,917,954.20|10.76%|177,345,224.20|
|Client 3|61,659,500.00|2.19%|3,164,975.00|
|Client 4|53,974,395.99|1.92%|6,766,258.59|
|Client 5|27,635,200.00|0.98%|1,381,760.00|
|Subtotal|1,153,169,783.11|40.97%|509,969,833.76|

 4. Prepayments
（1）Age analysis
In RMB
||||||
|-|-|-|-|-|
||Balance in year-end||Balance in year-begin||
|Age|||||
||Book balance|Proportion(%)|Book balance|Proportion(%)|
|Within 1 year|422,625,349.59|94.08%|169,302,923.28|83.74%|
|1-2 years|5,019,419.00|1.12%|10,874,142.27|5.38%|
|2-3 years|14,313,131.18|3.19%|17,195,603.48|8.50%|
|Over 3 years|7,276,313.90|1.62%|4,812,189.80|2.38%|
|Total|449,234,213.67|--|202,184,858.83|--|

(2) Top 5 of the closing balance of the prepayment colleted according to the prepayment target
||||
|-|-|-|
|Name|Amount|Proportion(%)|
|Siemens Industrial Turbomachinery AB|117,785,363.75|26.22%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Hangzhou Boiler Group Co., Ltd.|36,012,500.00|8.02%|
|Shanghai Huiyi International Freight agency Co., Ltd.|33,390,658.96|7.43%|
|Jinling International Co., Ltd.|23,163,441.57|5.16%|
|GEA Batyneo Heat-energy Technology(Changshu) Co., Ltd.|10,700,108.80|2.38%|
|Subtotal|221,051,073.08|49.21%|

 5.Dividend Receivable
（1）Dividend Receivable
In RMB
||||
|-|-|-|
|Items|Balance in year-end|Balance in year-begin|
|Hangzhou Bank（Pledged share bonus）|6,900,000.00||
|Total|6,900,000.00||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 6. Other account receivable
(1) Detailed categories
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||End of term|||||Beginning of term|||||
||Book balance||Bad debt provision|||Book balance||Bad debt provision|||
|Category|||||||||||
|||Proportion||Proportion|Book value||Proportion%||Proportion|Book value|
||Amount||Amount|||Amount||Amount|||
|||%||%|||||%||
|Other Accounts|||||||||||
|receivable portfolio|||||||||||
||32,074,225.09|100.00%|11,341,511.69|35.36%|20,732,713.40|42,152,338.08|100.00%|11,127,630.36|26.40%|31,024,707.72|
|subject to impairment|||||||||||
|by credit risk|||||||||||
|Total|32,074,225.09|100.00%|11,341,511.69|35.36%|20,732,713.40|42,152,338.08|100.00%|11,127,630.36|26.40%|31,024,707.72|

 Other Receivable accounts with large amount individually and bad debt provisions were provided
Not applicable
Other receivables with provision for bad and doubtful debts based on the other method in the portfolio
In RMB
|||||
|-|-|-|-|
||End of term|||
|Age||||
||Book balance|Bad debt provision|Proportion|
|Subitem within 1 year||||
|Within 1 year|12,493,631.86|624,514.21|5.00%|
|Subtotal within 1 year|12,493,631.86|624,514.21|5.00%|
|1-2 years|3,214,702.62|321,470.26|10.00%|
|2-3 years|5,218,118.67|1,565,295.20|30.00%|
|Over 3 years|11,147,771.94|8,830,232.02||
|3-4 years|5,741,839.00|3,445,103.40|60.00%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||
|-|-|-|-|
|4-5 years|104,021.60|83,217.28|80.00%|
|Over 5 years|5,301,911.34|5,301,911.34|100.00%|
|Total|32,074,225.09|11,341,511.69|35.36%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017Notes：
In the groups, accounts receivable adopting balance percentage method to withdraw bad debtprovision： Not applicable
In the groups, accounts receivable adopting other methods to accrue bad debtprovision:：
（2）Accrual period, recovery or reversal of bad debts situation
The current amount of provision for bad debts is RMB213,881.33 ; recovery or payback for bad debts Amount is RMB0.00.
(3) Other accounts receivable classified by the nature of accounts
In RMB
||||
|-|-|-|
|Nature|Closing book balance|Opening book balance|
|Export drawback receivable|1,888,034.21|13,234,170.89|
|Deposit|16,802,825.24|19,810,421.19|
|Petty cash|1,010,482.25|1,156,796.99|
|Other|12,372,883.39|7,950,949.01|
|Total|32,074,225.09|42,152,338.08|

（4）Top 5 of the closing balance of Other accounts receivable collated according to the arrears party
In RMB
|||||||
|-|-|-|-|-|-|
|||||Percentage in total other||
|Name of the company|Account property|Book balance|Age||Bad debt provision|
|||||receivable %||
|Shanghai Customs||||||
||Current account|3,710,320.94|Over 5 years|11.57%|3,710,320.94|
|Waigaoqiao Office||||||
|Export drawback||||||
||Export drawback|1,888,034.21|Within 1 year|5.89%|94,401.71|
|receivable||||||
|Guodian Chengxin|||Within 1 year, Over|||
||Deposit|1,294,500.00||4.04%|539,725.00|
|Tendering Co. Ltd.|||5 years|||
|Guoxin Bidding Group|||1-2 years, Over 5|||
||Deposit|849,500.00||2.65%|129,500.00|
|Co.,Ltd.|||years|||
|Guodian Trust Bidding||||||
||Deposit|728,000.00|Within 1 year|2.27%|36,400.00|
|Co., Ltd.||||||
|Toal||||||
||--|8,470,355.15|--|26.41%|4,510,347.65|

7. Inventories
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Whether the company needs to comply with the disclosure requirements of the particular industry
No
(1) Details
In RMB
||||||||
|-|-|-|-|-|-|-|
||End of term|||Beginning of term|||
|Items|||||Impairment||
||Book balance|Impairment provision|Book value|Book balance||Book value|
||||||provision||
|Raw|||||||
||521,124,494.23|309,803.19|520,814,691.04|568,639,726.41|309,803.19|568,329,923.22|
|materials|||||||
|Product in|||||||
||486,153,169.10|10,345,866.48|475,807,302.62|400,195,046.11|10,345,866.48|389,849,179.63|
|process|||||||
|Products in|||||||
||1,109,393,564.03|53,347,861.70|1,056,045,702.33|998,661,308.19|55,296,052.78|943,365,255.41|
|stock|||||||
|Total|||2,052,667,695.99|||1,901,544,358.26|
||2,116,671,227.36|64,003,531.37||1,967,496,080.71|65,951,722.45||

 Whether the company is required to comply with the "Shenzhen Stock Exchange Industry Information Disclosure Guidelines No. 4 - listed companies engaged in seed industry, planting business" disclosure requirements
No
(2) Inventory depreciation provision
In RMB
||||||||
|-|-|-|-|-|-|-|
|||Increased this period||Decreased this period|||
|Items|Beginning of term||||Others|End of term|
|||Provided|Others|Written back or off|||
|Raw materials|309,803.19|||||309,803.19|
|Product in|||||||
||10,345,866.48|||||10,345,866.48|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||
|-|-|-|-|
|process||||
|Products in stock||||
||55,296,052.78|1,948,191.08|53,347,861.70|
|Total||||
||65,951,722.45|1,948,191.08|64,003,531.37|

 At the end of the period, for the finished products which are directly to be sold and the raw materials that need further process, the estimated selling price of the finished products after the completion of the production reduces the expected cost incurring at the time of completion, the estimated selling expenses and the relevant taxes and fees, which determines the amount of net realizable value. According to the balance between the net realizable value and the cost of single inventory, the inventory depreciation reserve is extracted. The reduction of the inventory depreciation reserve for the current period is RMB1,948,191.08, which is the provision for the inventory depreciation reserve due to the use or sale of inventory.
8. Other current asset
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Bank financing products[Notes]|763,150,000.00|853,767,338.00|
|Input tax deductible|3,745,966.92|6,410,137.62|
|To verify the input tax||995,153.86|
|Prepaid income tax|1,042,554.65|1,845,850.11|
|Prepayment of other tax|4,838,380.58||
|Profit & loss of assets pending disposal|297,660.50||
|Total|773,074,562.65|863,018,479.59|

[Note]: Financial products are financial products and trust financial products, are in non-guaranteed
floating-income short-term (or short-term redeemable) financial products, and no active market price.
9 Sellable financial asset
(1) Details
In RMB
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||
|-|-|-|-|-|-|-|
||End of term|||Beginning of term|||
|||Impairm|||Impair||
|Items|||||||
||Book balance|ent|Book value|Book balance|ment|Book value|
|||provisio|||provis||
|||n|||ion||
|Available-for-sale equity|||||||
||3,010,113,616.40||3,010,113,616.40|3,060,865,862.60||3,060,865,862.60|
|instruments|||||||
|Including ：|||||||
||2,883,819,153.60||2,883,819,153.60|2,906,013,048.00||2,906,013,048.00|
|Measured by fair value|||||||
|Measured by cost|126,294,462.80||126,294,462.80|154,852,814.60||154,852,814.60|
|Total|3,010,113,616.40||3,010,113,616.40|3,060,865,862.60||3,060,865,862.60|

 (2) Available-for-sale financial assets measured by vair value at the period-end
In RMB
|||||
|-|-|-|-|
|Type|Available-for-sale equity|Available-for –sale||
||||Total|
||instruments|Liabilities instruments||
|Vair value|2,883,819,153.60||2,883,819,153.60|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 (3)Available-for-sale financial assets measured by cost at the period-end
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||Book balance||||Impairment provision||||Shareholding||
||||||||||proportion|Cash bonus of the|
|Investee|||||Period|||Period-e|||
||Period-begin|Increase||||Increase|Decrease||among the|reporting period|
||||||-begin|||nd|||
||||||||||investees||
|Hangzhou Changdi Equity Investment|||||||||||
||48,558,351.80||48,558,351.80|0.00|||||0.00%||
|Partnership(Limited liability)|||||||||||
|Hangzhou Steam Turbine Engineering Co., Ltd.|30,000,000.00|||30,000,000.00|||||15.00%||
|Hangzhou Jushi Investment Partnership（Limited|||||||||||
||30,000,000.00|20,000,000.00||50,000,000.00|||||33.33%||
|partnership）|||||||||||
|Wuxi Xinchang Steel Bube Co., ltd.|15,159,689.58|||15,159,689.58|||||18.00%||
|Zhejiang Zhongkong Solar Energy Technology|||||||||||
||15,000,000.00|||15,000,000.00|||||5.27%||
|Co., Ltd.|||||||||||
|Zhejiang Tianhang Steam Turbine Auxiliary|||||||||||
||10,000,000.00|||10,000,000.00|||||33.33%||
|Machinery Co., Ltd.|||||||||||
|Greenesol Co.(India)|5,534,773.22|||5,534,773.22|||||37.00%|1,590,356.24|
|Zhejiang Sanxin Automatic Engineering Co., Ltd.|600,000.00|||600,000.00|||||6.00%||
|Total|||||||||||
||154,852,814.60|20,000,000.00|48,558,351.80|126,294,462.80|||||--|1,590,356.24|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 10Fixed assets
(1) Details
In RMB
|||||||
|-|-|-|-|-|-|
||||Transportation|||
|Items|Houses & buildings|Machinery equipment||Office equipment|Total|
||||equipment|||
|I. Original price||||||
|1. Balance at||||||
||446,446,798.60|998,985,150.60|29,749,331.84|95,844,377.35|1,571,025,658.39|
|period-beginning||||||
|2.Increase in the current||||||
||17,550,203.26|4,763,758.46|244,258.80|1,818,156.12|24,376,376.64|
|period||||||
|(1) Purchase||1,361,091.42|244,258.80|580,855.49|2,186,205.71|
|（ 2 ） Inventory\Fixed||||||
|assets\ Transferred from|17,550,203.26|3,402,667.04||1,237,300.63|22,190,170.93|
|construction in progress||||||
|(3)Increased of||||||
||||||0.00|
|Enterprise Combination||||||
||||||0.00|
|3.Decreased amount of the||||||
||||784,794.00|760,019.44|1,544,813.44|
|period||||||
|（1）Dispose|||784,794.00|760,019.44|1,544,813.44|
||||0.00||0.00|
|4. Balance at period-end|463,997,001.86|1,003,748,909.06|29,208,796.64|96,902,514.03|1,593,857,221.59|
|II.Accumulated||||||
|amortization||||||
|1.Opening balance|176,390,042.92|673,282,598.59|20,553,828.14|78,225,107.16|948,451,576.81|
|2.Increased amount ofthe||||||
||6,755,225.91|28,241,862.25|321,364.35|3,236,536.24|38,554,988.75|
|period||||||
|(1) Withdrawal|6,755,225.91|28,241,862.25|321,364.35|3,236,536.24|38,554,988.75|
||||||0.00|
|3.Decrease in the reporting||||||
||||571,591.86|703,597.05|1,275,188.91|
|period||||||
|（1）Disposal|||571,591.86|703,597.05|1,275,188.91|
||||||0.00|
|4.Closing balance|183,145,268.83|701,524,460.84|20,303,600.63|80,758,046.35|985,731,376.65|
|III. Impairment provision|||||0.00|
|1.Opening balance|1,504,928.24|4,033,520.42||1,113,523.01|6,651,971.67|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||
|-|-|-|-|-|-|
|2.Increase in the reporting||||||
||||||0.00|
|period||||||
|（1）Withdrawl|||||0.00|
||||||0.00|
|3.Decrease i the reporting||||||
||||||0.00|
|period||||||
|（1）Disposal|||||0.00|
||||||0.00|
|4. Closing balance|1,504,928.24|4,033,520.42|0.00|1,113,523.01|6,651,971.67|
|IV. Book value||||||
|1.Book value ofthe||||||
||279,346,804.79|298,190,927.80|8,905,196.01|15,030,944.67|601,473,873.27|
|period-end||||||
|2.Book value of the||||||
||268,551,827.44|321,669,031.59|9,195,503.70|16,505,747.18|615,922,109.91|
|period-begin||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 11 Construction in process
（1）Details
In RMB
||||||||
|-|-|-|-|-|-|-|
||End of term|||Beginning of term|||
|Items||Impairment|||Impairment||
||Boook balance||Book value|Boook balance||Book value|
|||provision|||provision||
|Construction in process of|||||||
||97,239,204.16||97,239,204.16|94,170,909.99||94,170,909.99|
|parent Company|||||||
|Tangxi Workshop PhaseII,|||||||
||3,343,792.51||3,343,792.51|16,246,978.15||16,246,978.15|
|Gouneng Company|||||||
|Project of steam turbine heavy|||||||
||44,399,257.47||44,399,257.47|32,654,575.18||32,654,575.18|
|industry|||||||
|Casting companies to clean up|||||||
||5,350,975.59||5,350,975.59|4,870,579.64||4,870,579.64|
|cross project|||||||
|Casting company networking|||||||
||1,588,669.64||1,588,669.64|1,517,473.06||1,517,473.06|
|system project|||||||
|Prepayment for equipment or|||||||
||4,149,764.39||4,149,764.39|4,283,373.39||4,283,373.39|
|projects|||||||
|Total|156,071,663.76||156,071,663.76|153,743,889.41||153,743,889.41|

(2) Changes of significant construction in progress
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 In RMB
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||||||Includin|||
|||||||||||g:|||
||||||||||||Capitaliz|Source|
|||||||||Project|Capitaliz|capitaliz|||
|||||Transferred to fixed|||Proportion||||ation of|of|
|Name of project|Budget|Opening balance|Increase||Other decrease|End balance||proces|ation of|ation of|||
|||||assets|||%||||interest|fundin|
|||||||||s|interest|interest|||
||||||||||||rate (%)|g|
|||||||||||this|||
|||||||||||period|||
|||||||||Under|||||
|Construction in process of|||||||||||||
||128,221,400.00|90,619,544.91|6,619,659.25|||97,239,204.16|75.84%|Constr||||Self|
|parent Company|||||||||||||
|||||||||uction|||||
|Completed project of parent||||||||Compl|||||
||6,750,000.00|3,551,365.08|566,834.20|4,118,199.28|||61.01%|||||Self|
|Company||||||||eted|||||
|||||||||Under|||||
|Tangxi Workshop PhaseII,|||||||||||||
||30,000,000.00|16,246,978.15|5,168,786.01|18,071,971.65|0.00|3,343,792.51|71.39%|Constr||||Self|
|Gouneng Company|||||||||||||
|||||||||uction|||||
|||||||||Under|||||
|Project of steam turbine heavy|||||||||||||
||1,794,100,000.00|32,654,575.18|11,744,682.29|||44,399,257.47|2.47%|Constr||||Self|
|industry|||||||||||||
|||||||||uction|||||
|||||||||Under|||||
|Casting companies to clean up|||||||||||||
||10,000,000.00|4,870,579.64|480,395.95|||5,350,975.59|53.51%|Constr||||Self|
|cross project|||||||||||||
|||||||||uction|||||
|||||||||Under|||||
|Casting company networking|||||||||||||
||4,000,000.00|1,517,473.06|71,196.58|||1,588,669.64|39.72%|Constr||||Self|
|system project|||||||||||||
|||||||||uction|||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|Prepayment for equipment or||||||||||
|||||||||Under||
|||4,283,373.39|725,000.00||858,609.00|4,149,764.39||Constr|Self|
|projects||||||||uction||
|Total|1,973,071,400.00|153,743,889.41|25,376,554.28|22,190,170.93|858,609.00|156,071,663.76|--|--|--|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 12 Intangible assets
（1）Details
In RMB
|||||||
|-|-|-|-|-|-|
||||Non patent|||
|Items|Landusing right|Patent||Software|Total|
||||technology|||
|I. Original price||||||
|1. Balance at||||||
||332,298,312.33|209,433.96|8,000,000.00|328,376.07|340,836,122.36|
|period-beginning||||||
|2.Increase in the current||||||
|period||||||
|(1) Purchase||||||
|(2)Internal Development||||||
|(3)Increased of Enterprise||||||
|Combination||||||
|3.Decreased amount of||||||
|the period||||||
|（1）Disposal||||||
|4.Closing balance||||||
||332,298,312.33|209,433.96|8,000,000.00|328,376.07|340,836,122.36|
|II.Accumulated||||||
|amortization||||||
|1.Opening balance|41,782,089.97|114,000.00|1,266,666.71|267,931.60|43,430,688.28|
|2.Increased amount of||||||
||2,575,171.78|28,000.00|400,000.02|22,837.60|3,026,009.40|
|the period||||||
|(1) Withdrawal||||||
||2,575,171.78|28,000.00|400,000.02|22,837.60|3,026,009.40|
|3.Decreased amount of the||||||
|period||||||
|（1）Disposal||||||
|4.Closing balance||||||
||44,357,261.75|142,000.00|1,666,666.73|290,769.20|46,456,697.68|
|III. Impairment provision||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||
|-|-|-|-|-|-|
|1.Opening balance||||||
|2.Increased amount of the||||||
|period||||||
|(1) Withdrawal||||||
|3.Decreased amount of||||||
|the period||||||
|（1）Disposal||||||
|4.Closing balance||||||
|IV. Book value||||||
|1.Closing book value|287,941,050.58|67,433.96|6,333,333.27|37,606.87|294,379,424.68|
|2.Opening book value|290,516,222.36|95,433.96|6,733,333.29|60,444.47|297,405,434.08|

 The intangible assets by the end of the formation of the company's internal R& D accounted for0.00% of the proportion of the balance of intangible assets
13 Long-term amortize expenses
In RMB
|||||||
|-|-|-|-|-|-|
||||Amortized expenses|||
|Items|Balance in|Increase in this||Other loss|Balance in year-end|
||year-begin|period||||
|Redecoration|1,306,880.81||132,581.88||1,174,298.93|
|Afforestation fees|124,088.00||||124,088.00|
|Total|1,430,968.81||132,581.88||1,298,386.93|

 14 Deferred income tax assets/deferred income tax liabilities
(1) Deferred income tax assets had not been off-set
In RMB
||||||
|-|-|-|-|-|
||Balance in year-end||Balance in year-begin||
|Items|Deductible temporary|Deferred income tax|Deductible temporary|Deferred income tax|
||difference|assets|difference|assets|
|Provision for Asset Impairment|1,012,675,154.36|157,148,474.80|981,341,256.69|153,377,711.38|
|nternal trade profit not realized|49,905,473.34|7,485,821.00|58,099,229.91|9,500,467.96|
|Deductible loss|38,302,132.26|5,745,319.84|30,002,132.26|4,500,319.84|
|nventory impairment provision|64,003,531.37|9,600,529.70|65,951,722.45|9,892,758.36|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||
|-|-|-|-|-|
|Fixed assets depreciation reserves|6,651,971.67|997,795.75|6,651,971.67|997,795.75|
|Temporary difference such as|||||
||3,751,710.39|562,756.56|3,751,710.39|562,756.56|
|amortizing of software expense|||||
|Total|1,175,289,973.39|181,540,697.65|1,145,798,023.37|178,831,809.85|

 (2) Deferred income tax liabilities had not been off-set
In RMB
||||||
|-|-|-|-|-|
||Balance in year-end||Balance in year-begin||
|Items|||||
||Deductible temporary|Deferred income tax|Deductible temporary|Deferred income taxliabilities|
||difference|liabilities|difference||
|Changes in fair value of tradable||||377,258,851.20|
||2,492,865,113.60|373,929,767.04|2,515,059,008.00||
|financial assets|||||
|Accumulated depreciation|6,651,971.67|997,795.75|6,651,971.67|997,795.75|
|Total|2,499,517,085.27|374,927,562.79|2,521,710,979.67|378,256,646.95|

（3）Deferred income tax assets and liabilities are presented as net amount after neutralization
In RMB
||||||
|-|-|-|-|-|
||Deferred Income Tax Assets|Temporarily Deductable or|Deferred Income Tax Assets|Temporarily Deductable or|
|Items|or Liabilities at the End of|Taxable Difference at the End|or Liabilities at the|Taxable Difference at the|
||Report Period|of Report Period|Beginning of Report Period|Beginning of Report Period|
|Deferred income tax||181,540,697.65||178,831,809.8|
|assets|||||
|Deferred income tax||374,927,562.79||378,256,646.9|
|liabilities|||||

(4)Details of income tax assets not recognized
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Deductible provisional differences|931,148.96|1,476,578.54|
|Deductible losses|9,924,189.66|12,315,626.29|
|Subtotal|10,855,338.62|13,792,204.83|

 (5) The un-recognized deductible losses of deferred income tax assets will due in the following years:
In RMB
|||||
|-|-|-|-|
|Year|End of term|Beginning of term|Remark|
|2018||684,308.39||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||
|-|-|-|-|
|2019||1,037,052.28||
|2020|2,272,672.55|3,113,580.77||
|2021|6,550,312.26|7,480,684.85||
|2022|1,101,204.85|||
|Total|9,924,189.66|12,315,626.29|--|

15Short-term loans
（1）Category of short-term loans
In RMB
||||
|-|-|-|
|Items|Balance in year-end|Balance in year-begin|
|Mortgage loan|78,700,000.00|73,000,000.00|
|Guarantee loan|100,000,000.00|100,000,000.00|
|Credit loan|19,000,000.00||
|Total|197,700,000.00|173,000,000.00|

 16.Bill payable
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Bank acceptance|151,467,745.11|143,007,715.10|
|Total|151,467,745.11|143,007,715.10|

 17. Account payable
（1）Category of Account payable
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Goods|1,090,300,026.76|832,264,375.15|
|Payment for equipment and projects|7,763,195.94|21,188,214.36|
|Total|1,098,063,222.70|853,452,589.51|

 18. Advances received
（1）Category of Advances received
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Goods|2,197,267,051.95|1,827,959,793.62|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Total|2,197,267,051.95|1,827,959,793.62|

 19.Employees’ wage payable
(1) Details
In RMB
||||||
|-|-|-|-|-|
|Items|Beginning of term|Increased this period|Decreased this period|End of term|
|I. Short-term wages|48,273,561.62|312,239,012.26|312,792,720.04|47,719,853.84|
|II. Welfare after leaving|||||
|of position-fixed|22,951,072.41|36,715,209.10|46,319,226.63|13,347,054.88|
|provision scheme|||||
|Total|71,224,634.03|348,954,221.36|359,111,946.67|61,066,908.72|

 (2) Details of short term wages
In RMB
||||||
|-|-|-|-|-|
|Items|Beginning of term|Increased this period|Decreased this period|End of term|
|1.Wage, bonus, allowance and subsidies|35,531,106.94|228,812,538.96|244,250,107.13|20,093,538.77|
|2. Employee welfare||26,723,363.71|14,392,988.46|12,330,375.25|
|3. Social insurance|5,862,944.64|23,214,535.38|23,283,256.62|5,794,223.40|
|Incl. Medical insurance|5,423,894.94|20,690,298.82|20,705,065.85|5,409,127.91|
|Labor injury insurance|124,073.45|760,449.54|768,860.84|115,662.15|
|Maternity insurance|314,976.25|1,763,787.02|1,809,329.93|269,433.34|
|4. Housing fund|109,020.96|22,800,436.00|22,792,856.00|116,600.96|
|5. Labour union fee and employee|||||
||6,770,489.08|9,683,454.88|7,068,828.50|9,385,115.46|
|education fee|||||
|7.Short-term profit sharing scheme||1,004,683.33|1,004,683.33||
|Total|48,273,561.62|312,239,012.26|312,792,720.04|47,719,853.84|

 (3) Details of fixed provision scheme
In RMB
||||||
|-|-|-|-|-|
|Items|Beginning of term|Increased this period|Decreased this period|End of term|
|1.Basic pension|||||
||4,430,334.68|25,046,017.10|25,693,581.95|3,782,769.83|
|insurance|||||
|2. Unemployment|||||
||314,118.76|1,535,422.12|1,673,757.04|175,783.84|
|insurance|||||
|3. Enterprise annual fee|18,206,618.97|10,133,769.88|18,951,887.64|9,388,501.21|
|Total|22,951,072.41|36,715,209.10|46,319,226.63|13,347,054.88|

20. Tax Payable
In RMB
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Items|Balance in year-end|Balance in year-begin|
|VAT|18,399,163.94|59,676,617.21|
|Expenditure taxes|0.00|0.00|
|Enterprise Income tax|||
||3,962,801.22|16,338,759.59|
|Individual Income tax|2,582,904.92|2,035,807.07|
|City Construction tax|1,401,749.60|4,224,180.62|
|Business Tax|||
|Property tax|945,279.30||
|Education subjoin|639,818.15|1,822,362.43|
|Locality Education subjoin|376,718.50|1,202,457.87|
|Stamp tax|29,716.82|56,823.07|
|Local water source foundation|1,767,814.88|1,767,814.88|
|Disabled security fund|2,087.42|2,087.42|
|Land use tax|381,733.15|3,112,763.00|
|Total|30,489,787.90|90,239,673.16|

 21. Interest payable
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Long term interest on borrowings due in|||
|||41,750.63|
|installments|||
|Interest on short-term borrowings|||
|||92,625.69|
|Total||134,376.32|

 22.Other account payable
(1) Details
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Deposite|1,005,905.34|3,607,868.79|
|Provisional account payable|19,168,000.22|23,344,791.25|
|Other|8,854,954.77|3,868,320.76|
|Total|29,028,860.33|30,820,980.80|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 23. Non-current liabilities due within 1 year
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Long-term loans due within 1 year|18,300,000.00|18,500,000.00|
|Total|18,300,000.00|18,500,000.00|

 24.. Long-term loan
(1) Details
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|Mortgage loan|4,900,000.00|4,900,000.00|
|Total|4,900,000.00|4,900,000.00|

 25.Long term account payable
(1) Details
In RMB
||||
|-|-|-|
|Items|End of term|Beginning of term|
|CDB investment fund|208,000,000.00|208,000,000.00|
|Drawing in administrative restructuring|330,000.00|330,000.00|
|Income payable of CDB||27,733.33|
|Total|208,330,000.00|208,357,733.33|

 26. Deferred income
In RMB
|||||||
|-|-|-|-|-|-|
|Items|||Decreased this|||
||Beginning of term|Increased this period||End of term|Cause|
||||period|||
|Government subsidy|5,422,895.00|1,808,000.00||7,230,895.00||
|Total|5,422,895.00|||7,230,895.00||
|||1,808,000.00|||--|

(2) Details of government subsidies
In RMB
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||
|-|-|-|-|-|-|-|
||||Amount||||
|||New subsidy in|transferred to|Other||Asset-related or|
|Items|Beginning of term||||End of term||
|||current period|non-operational|changes||income-related|
||||income||||
|Financial support for industrial|||||||
||287,800.00|400,000.00|||687,800.00|Asset-related|
|projects|||||||
|Government subsidy for casting|||||||
||287,800.00||||287,800.00|Asset-related|
|project|||||||
|Circular economy financial subsidy|||||||
||114,100.00||||114,100.00|Asset-related|
|Projects of technological|||||||
||26,000.00||||26,000.00|Asset-related|
|transformation|||||||
|Subsidy for industrial upgrading by|||||||
||480,000.00||||480,000.00|Asset-related|
|provincial government|||||||
|Finance for casting project|3,906,405.00||||3,906,405.00|Asset-related|
|Government subsidy for industrial|||||||
|entities from Yuhang District|320,790.00||||320,790.00|Asset-related|
|Government in the 2nd half of 2009|||||||
|Financial subsidy for R & D|||||||
|||1,408,800.00|||1,408,800.00|Asset-related|
|projects|||||||
|Total|5,422,895.00|1,808,000.00|||7,230,895.00|--|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 27. Stock capital
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Increase/decrease this time (+ , - )||||||
||Balance Year-beginning|Issuing of new|Bonus|Transferred from|||Balance year-end|
||||||Other|Subtotal||
|||share|shares|reserves||||
|Total of capital|754,010,400.00||||||754,010,400.00|
|shares||||||||

28. Capital reserves
In RMB
||||||
|-|-|-|-|-|
|Items|Year-beginning balance|Increase in the|Decrease in the|Year-end balance|
|||current period|current period||
|Share premium|81,815,220.00|||81,815,220.00|
|Other capital reserves|57,775,125.09|||57,775,125.09|
|Total|139,590,345.09|||139,590,345.09|

29. Other comprehensive income
In RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Occurred current term||||||
|Items|Beginning of term|Amount occurred|Less: accounted as other gains|Less: Income tax|Attributable to the|Attributable to|End of term|
|||before income tax of|previously but transferred to|expenses|parent co. after tax|minority||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||||
|-|-|-|-|-|-|-|-|
|||the period|gain/loss this period|||shareholders||
|||||||after tax||
|II. Other Comprehensive income|||||-18,615,099.34|||
|that will be reclassified|2,137,419,299.84|-21,607,437.73||-3,329,084.16||336,745.77|2,118,804,200.50|
|subsequently to profit or loss||||||||
|Gains or losses on changes in fair|||||-18,864,810.24|||
|value of available-for-sale|2,137,800,156.80|-22,193,894.40||-3,329,084.16|||2,118,935,346.56|
|financial assets||||||||
|Difference of translating of foreign|||||249,710.90|||
||-380,856.96|586,456.67||||336,745.77|-131,146.06|
|currency accounts||||||||
|Total of other comprehensive|2,137,419,299.84||||-18,615,099.34|336,745.77|2,118,804,200.50|
|||-21,607,437.73||-3,329,084.16||||
|income||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 30.Special reserves
In RMB
||||||
|-|-|-|-|-|
|Items|Beginning of term|Increased this period|Decreased this period|End of term|
|Labor safety expenses|||||
||27,546,353.37|537,862.83|673,423.90|27,410,792.30|
|Total|27,546,353.37|||27,410,792.30|
|||537,862.83|673,423.90||

 31. Surplus reserves
In RMB
||||||
|-|-|-|-|-|
|Items|Beginning of term|Increased this period|Decreased this period|End of term|
|Statutory surplus|||||
||621,112,807.78|||621,112,807.78|
|reserves|||||
|Total|621,112,807.78|||621,112,807.78|

 32. Retained profit
In RMB
||||
|-|-|-|
|Items|Current term|Same period of last term|
|Amount of retained profit at beginning of period|2,705,667,037.15||
|Plus: Net profit attributable to owners of the parent|||
||43,995,804.38||
|company|||
|Common share dividend payable|2,749,662,841.53||

As regards the details of adjusted the beginning undistributed profits
(1)As the retroactive adjustment on Enterprise Accounting Standards and its related new regulations, the affected beginning undistributed profits are RMB 0.00.
(2) As the change of the accounting policy, the affected beginning undistributed profits are RMB 0.00.
(3) As the correction of significant accounting error, the affected beginning undistributed profits are RMB 0.00 . (4) As the change of consolidation scope caused by the same control, the affected beginning undistributed profits are RMB 0.00.
(5) Other adjustment of the total affected beginning undistributed profits are RMB 0.00 .
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 33. Business income and Business cost
In RMB
||||||
|-|-|-|-|-|
||Occurred current term||Occurred in previous term||
|Items|||||
||Income|Cost|Income|Cost|
|Main Business|1,565,958,109.92|1,100,055,409.37|1,362,270,491.45|848,808,322.11|
|Other|97,766,592.34|92,329,642.11|5,153,280.43|2,129,583.93|
|Total|1,663,724,702.26|1,192,385,051.48|1,367,423,771.88|850,937,906.04|

 34. Business tax and surcharge
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|City maintenance and construction tax|5,790,983.04|4,848,384.15|
|Education surtax|2,632,346.60|2,123,039.65|
|House tax|4,754,574.06||
|Land use tax|2,768,440.30||
|vehicle and vessel tax|23,508.00||
|Stamp tax|1,196,199.41||
|Locality Education surcharge|1,570,499.17|1,415,359.85|
|Business tax||36,467.22|
|Total|18,736,550.58|8,423,250.87|

 35. Sales expense
In RMB
||||
|-|-|-|
|Items|Amount of this period|Amount of last period|
|Employees’ remunerations|31,132,404.87|24,144,838.68|
|Transportation|15,433,500.28|22,067,695.57|
|Business trips|11,409,777.43|9,321,130.31|
|Business reception expenses|3,630,718.14|3,856,181.75|
|Conferences|1,702,501.62|762,768.90|
|Consulting service fee|8,523,496.71|7,376,359.34|
|Insurance for turbine unit|241,740.99|115,012.33|
|Warranty expense|2,654,824.68|1,360,196.29|
|Product exhibition|462,976.14|879,035.70|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Office expenses|803,886.89|290,453.85|
|Others|5,878,188.10|5,693,921.26|
|Total|81,874,015.85|75,867,593.98|

 36.Administrative expense
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|Employees’ remunerations|158,545,322.20|154,766,064.42|
|R&D expenses|140,500,456.42|138,018,919.01|
|Asset depreciation and amortizing|7,147,861.91|10,600,496.96|
|Business reception expenses|6,238,067.45|6,075,008.72|
|House rental, property management, water|||
||3,701,610.81|3,912,114.29|
|and power|||
|Traveling fees|3,768,385.52|3,693,110.12|
|Taxes||5,995,092.98|
|Material, low-value-consumable|1,137,285.58|1,179,867.75|
|Office expenses|1,693,719.65|1,529,414.33|
|Maintaining|1,863,668.96|1,393,232.10|
|Other|29,815,399.31|27,943,597.87|
|Total|354,411,777.81|355,106,918.55|

 37. Financial expenses
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|Interest expense|5,243,164.77|4,856,082.74|
|Less: Incoming interests|3,290,329.23|2,276,735.92|
|Exchange gains/losses|3,746,363.69|-3,218,647.71|
|Commission|1,795,106.71|1,004,308.45|
|Other|450,938.35|147,021.61|
|Total|7,945,244.29|512,029.17|

 38. Asset impairment loss
In RMB
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|I .Losses for bad debts|35,378,404.08|125,619,636.17|
|Total|35,378,404.08|125,619,636.17|

 39. Investment income
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|Investment gains from holding of sellable financial assets|44,203,908.24|3,587,659.70|
|Investment income from disposal of available for sale financialassets|||
||25,121,648.20||
|Gains from financing products|19,662,950.09|11,457,674.92|
|Total|88,988,506.53|15,045,334.62|

 40.Non-Operation income
In RMB
|||||
|-|-|-|-|
||||Recorded in the amount of the|
|Items|Occurred current term|Occurred in previous term||
||||non-recurring gains and losses|
|Total gains from disposal of|196,910.10|17,299.04||
||||196,910.10|
|non-current assets||||
|Including：Gains from disposal of||||
||196,910.10|17,299.04|196,910.10|
|fixed assets||||
|Government Subsidy|2,505,237.27|318,530.00|2,505,237.27|
|Compensation income|1,397,065.22|6,372,280.92|1,397,065.22|
|Other|455,637.29|136,652.06|455,637.29|
|Total|4,554,849.88|6,844,762.02|4,554,849.88|

 Government subsidy reckoned into current gains/losses
In RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|||||Whether the||||Asset-related or|
||Issuin|Releas||impact of|Whether||||
|||||||Amount of this|Amount of last|income-related|
|Subsidy items|g|e|Type|subsidies on the|special||||
|||||||period|period||
||subject|cause||current profit|subsidies||||
|||||and loss|||||
|In 2014 the provincial patent grant /||||No|No||4,000.00|Income-related|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||||
|-|-|-|-|-|-|-|-|-|
|Yuhang District of Hangzhou Science|||||||||
|and Technology Bureau|||||||||
|2014 R & D investment subsidy||||No|No||314,200.00|Income-related|
|Tax service fee||||No|No||330.00|Income-related|
|Yuhang District Finance Bureau 2016|||||||||
|Industrial Supplies and Industrial||||No|No|1,230,000.00||Income-related|
|Internet Project Grant|||||||||
|Yuhang District in 2016 Hangzhou high|||||||||
|- tech industrialization project special||||No|No|1,000,000.00||Income-related|
|funds|||||||||
|Color steel shed "Chu Lan Mei Hua"|||||||||
|||||No|No|251,851.20||Income-related|
|incentive funds|||||||||
|Other small amount subsidies||||No|No|23,386.07||Income-related|
|Total|--|--|--|--|--|2,505,237.27|318,530.00|--|

 41. Non-operational expenditure
In RMB
|||||
|-|-|-|-|
||||Amount accounted into|
|Items|Current term|Same period of last term|non-recurring gain/loss of|
||||current term|
|Total of loss from disposal of non-current|16,356.68|181,198.86||
||||16,356.68|
|assets||||
|Incl. Loss from disposal of fixed assets|16,356.68|181,198.86||
|Donations|10,000.00||10,000.00|
||232,194.24|121,140.00|232,194.24|
|Penalty paid out||||
||1,462.68|1,606,344.54||
|Local water source foundation||||
|Penalties||||
|||4,129.58||
|Loss damage|19,777.53|44,881.67|19,777.53|
|Other|279,791.13|1,957,694.65|278,328.45|
|Total||||

42. Income tax expenses
(1) Details
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 In RMB
||||
|-|-|-|
|Items|Current term|Same period of last term|
|Income tax of current term|9,237,255.37|10,258,830.52|
|Deferred income tax|||
||-2,708,887.80|-13,092,761.86|
|Total|6,528,367.57|-2,833,931.34|

 (2) Adjustment process of accounting profit and income tax expenses
In RMB
|||
|-|-|
|Items|Current term|
|Total profit|66,257,223.45|
|Income tax expense at statutory / applicable tax rates|9,938,583.52|
|Effect of different tax rates applicable to subsidiaries|2,431,049.22|
|Income not subject to tax|-6,730,586.24|
|Expenses not deductible for tax purposes|614,019.86|
|Taxation influence of unrecognized deductible loss and||
||275,301.21|
|deductible temporary difference||
|Income tax expenses|6,528,367.57|

 43.Other Comprehensive income
Please find the statement in the notes of consolidated balance sheet.
44. Notes Cash flow statement
(1) Other cash received from business operation
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|Deposit interest|3,290,329.23|2,276,884.34|
|Government subsidies received|4,313,237.27|3,628,381.23|
|Deposit for bidding and other|350,000.00|-50,000.00|
|Compensation income|10,697.28|163,534.00|
|Other|46,018.25|668,444.48|
|Total|8,010,282.03|6,687,244.05|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 2. Other cash paid for business activities
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|Travel expenses|15,569,947.22|16,226,976.75|
|Transportation|2,386,213.92|3,272,653.84|
|Business trips|9,114,231.52|10,323,734.57|
|Maintaining|892,883.85|609,448.28|
|Property management and civil services|3,045,005.51|3,269,592.99|
|Deposit for bidding and others|533,396.53|3,788,086.28|
|Office expenses|3,374,787.41|2,915,351.76|
|Conferences|1,984,035.08|1,286,764.88|
|Consulting service fee|9,794,242.77|7,080,357.89|
|Transportation and vehicles|2,794,047.26|2,377,922.97|
|Other|29,495,330.68|27,694,463.47|
|Total|78,984,121.75|78,845,353.68|

 3. Other investment-related cash received
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|Repurchasing of trusteeship|1,819,767,338.00|812,150,000.00|
|Total|1,819,767,338.00|812,150,000.00|

 4. Other cash paid for investment activities
In RMB
||||
|-|-|-|
|Items|Current term|Same period of last term|
|Purchasing of financial products|1,729,150,000.00|938,850,000.00|
|Total|1,729,150,000.00|938,850,000.00|

 5. Other financing-related cash received
In RMB
||||
|-|-|-|
|Items|Occurred current term|Occurred in previous term|
|Cancellation of company property|||
||12,824,456.40||
|assignment|||
|Total|12,824,456.40||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 45 Supplementary data of cash flow statement
(1) Supplementary data of cash flow statement
In RMB
||||
|-|-|-|
|Supplementary Info.|Amount of the Current Term|Amount of the Previous Term|
|I. Adjusting net profit to cash flow from operating activities|||
||--|--|
|Net profit|59,728,855.88|-26,277,229.57|
|Add: Impairment loss provision of assets|35,378,404.08|125,619,636.17|
|Depreciation of fixed assets, oil and gas assets and consumable|||
||38,554,988.75|41,159,790.67|
|biological assets|||
|Amortization of intangible assets|3,026,009.40|3,663,502.57|
|Amortization of Long-term deferred expenses|132,581.88||
|Loss on disposal of fixed assets, intangible assets and other|||
||-180,553.42|5,418.05|
|long-term deferred assets|||
|Financial cost|8,369,082.20|9,053,563.16|
|Loss on investment|-88,988,506.53|-15,045,334.62|
|Decrease of deferred income tax assets|-2,708,887.80|-13,949,461.00|
|Increased of deferred income tax liabilities|-3,329,084.16|0.00|
|Decrease of inventories|-151,123,337.73|-408,813,212.52|
|Decease of operating receivables|-431,306,194.64|62,274,426.08|
|Increased of operating Payable|522,271,847.58|437,187,652.12|
|Other|-135,561.07|-179,698.16|
|Net cash flows arising from operating activities|-10,310,355.58|214,699,052.95|
|II. Significant investment and financing activities that without|||
||--|--|
|cash flows:|||
|3．Movement of cash and cash equivalents：|||
||--|--|
|Ending balance of cash|1,010,649,375.76|768,360,107.29|
|Less: Beginning balance of cash equivalents|895,037,559.34|751,596,796.24|
|Net increase of cash and cash equivalents|115,611,816.42|16,763,311.05|

（2）Composition of cash and cash equivalents
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 In RMB
||||
|-|-|-|
|Items|Amount of current period|Amount of previous period|
|I. Cash|1,055,809,378.48|895,037,559.34|
|Of which: Cash in stock|||
||204,146.76|326,226.09|
|Demand bank deposit|1,010,875,229.00|840,734,362.93|
|III. Balance of cash and cash equivalents at|1,055,809,378.48|895,037,559.34|
|the period end|||

46. Assets with limitation on ownership or using rights
In RMB
||||
|-|-|-|
|Items|Closing book value|Causation o limitation|
|Monetary capital|45,160,002.72|Used as security for issuing of acceptance drafts and bill of guarantees|
|Bill receivable|22,970,000.00|Used as security for issuing of acceptance drafts|
|Fixed assets|||
||117,870,021.27|Used to obtain bank loans|
|Intangible assets|||
||89,391,343.91|Collateral for obtaining bank loans and investment funds from CDB|
|Available for sale financial|||
||478,170,000.00|nvestment funds for the development of the State Fund|
|assets|||
|Total|||
||753,561,367.90|--|

47Monetary items in foreign currencies
(1) Foreign currency monetary items
In RMB
|||||
|-|-|-|-|
||||Translated to RMB at end of|
|Items|Balance at end of period|Exchange rate||
||||period|
|Monetary capital|--|--|175,766,140.21|
|Incl：USD|25,328,618.45|6.774|171,576,061.38|
|Euro|120,248.35|7.750|931,876.62|
|JPY|9,031.00|0.060|543.45|
|Rupiah|6,286,507,508.01|0.00052|3,256,410.89|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||
|-|-|-|-|
|Ruble|10,650.00|0.117|1,247.87|
|Account receivable|--|--|191,093,308.06|
|Incl：USD|24,542,406.53|6.774|166,250,261.83|
|Euro|2,582,293.40|7.750|20,011,741.08|
|Rupiah|9,326,843,918.91|0.00052|4,831,305.15|
|Other account receivable|||247,685.61|
|Incl：USD|36,562.00|6.774|247,685.61|

 (2) Note to overseas operating entities, including important overseas operating entities, which should be disclosed about its principal business place, function currency for bookkeeping and basis for the choice. In case of any change in function currency, the cause should be disclosed.
Hangzhou Zhongneng Steam Turbine Power (Indonesia) Co., Ltd. has its business located in Indonesia Rupee is the pricing and booking currency of business operation.
VIII.Changes of consolidation scope
1.Disposal of subsidiary
Whether there is a single disposition to invest in the subsidiary that is the case of loss of control
No
Whether there is a case where the investment is made to the subsidiary and the loss of control in the current period No
2.Other reasons for the merger scope change
Other causes of the consolidation scope changes (e.g., the new subsidiary, liquidation subsidiary, etc.) and its related conditions:
||||||
|-|-|-|-|-|
|Company name|Acquisition anddisposal of subsidiariesduring the reportingperiod|Write off time|Contribution|Funded ratio|
|Xinjiang Taifeng Hangzhou Steam turbine completetechnology development Co., Ltd.|Write off|April 2017|10.20 million|51%|
|Hangzhou Hangqi Boiler Co., Ltd|Write off|April 2017|10 million|50%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 IX. Equities in Other Entities
(I) Equity in major subsidiaries
1. Composition of major subsidiaries
||||||||
|-|-|-|-|-|-|-|
||Main business||Business|Share proportion %|||
|Name of the subsidiaries||Reg. Add.||||Way of obtain|
||location||property|Direct|Indirect||
|Zhejiang Steam Trubine Packaged|Hangzhou|Hangzhou|||||
||||Manufacturing|||Incorporation|
|Technologies Development Co.,||||70.86%|||
||Zhejiang|Zhejiang|||||
|Ltd.|||||||
|Hangzhou Zhongneng Steam|||||||
||Hangzhou|Hangzhou|||||
|Turbine Power Co., Ltd.|||Manufacturing|||Incorporation|
|||||60.83%|||
||Zhejiang|Zhejiang|||||
|(Zhongneng Co.)|||||||
|Hangzhou Steam Turbine Casting|Hangzhou||||||
|||Hangzhou|||||
||||Manufacturing|51.00%||Incorporation|
|Co., Ltd.|Zhejiang|Zhejiang|||||
|Hangzhou Steam Turbine|Hangzhou|Hangzhou|||||
||||Manufacturing|||Incorporation|
|||||52.00%|||
|Machinery Equipment Co., Ltd.|Zhejiang|Zhejiang|||||
|Hangzhou Steam Turbine Auxiliary|||||||
||Hangzhou|Hangzhou|||||
|Machinery Co., Ltd. (Auxiliary|||Manufacturing|||Incorporation|
|||||87.53%|||
||Zhejiang|Zhejiang|||||
|Machinery Co.)|||||||
|||||||Incorporation|
|Zhejiang Turbine Import & Export|Hangzhou||||||
|||Hangzhou|||||
||||Commerce|100.00%|||
|Co., Ltd. (Turbine Co.)|Zhejiang|Zhejiang|||||
|Hangzhou Steam Turbine Heavy|Hangzhou|Hangzhou|||||
||||Manufacturing||||
|||||||Incorporation|
|||||100.00%|||
|Industry Co., Ltd.|Zhejiang|Zhejiang|||||
|||||||Incorporation|
|Zhejiang Huayuan Steam Turbine|Deqing|Hangzhou|||||
||||Manufacturing||75.00%||
|Machinery Co., Ltd.|Zhejiang|Zhejiang|||||
|Hangzhou Guoneng Steam Turbine|Hangzhou|Hangzhou|||||
|||||||Incorporation|
||||Manufacturing||75.00%||
|Engineering Co., Ltd.|Zhejiang|Zhejiang|||||
|||||||Incorporation|
|Xinjiang Taifeng Hangzhou Steam|||||||
|Turbine Packaged Technology|Xinjiang|Xinjiang|Manufacturing||51.00%||
|Development Co., Ltd.|||||||
|||||||Incorporation|
|Hangzhou Bypass Mechanical &|Hangzhou|Hangzhou|Manufacturing||70.00%||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||
|-|-|-|-|-|-|
|Electrical Equipment Co., Ltd.|Zhejiang|Zhejiang||||
||||||Incorporation|
|Shijiazhuang Hangneng Steam||||||
||Shijiazhuang|Shijiazhuang||||
|Turbine Technology Service Co.,|||Service|60.00%||
||Hebei|Hebei||||
|Ltd.||||||
|Kunming Hangzhong Steam||||||
||||||Incorporation|
|Turbine Technology Sevrvice Co.,|Kunming Yunnan|Kunming Yunnan|Service|60.00%||
|Ltd.||||||
||||||Incorporation|
|Wulumuqi Hangzhongneng Steam||||||
||Wulumuqi|Wulumuqi||||
|Turbine Technology Sevrvice Co.,|||Service|60.00%||
||Xingjiang|Xingjiang||||
|Ltd.||||||
|Tangshan Hangneng Steam turbine||||||
||||||Incorporation|
||Tangshan Hebei|Tangshan Hebei|Service|60.00%||
|Technology Sevrvice Co., Ltd||||||
||||||Incorporation|
|Jilin Hangzhongneng Steam turbine||||||
||Jilin|Jilin|Service|60.00%||
|Technology Sevrvice Co., Ltd||||||
|Guangxi Hangzhongneng Steam||||||
||||||Incorporation|
|turbine Technology Sevrvice Co.,|Nanning Guangxi|Nanning Guangxi|Service|60.00%||
|Ltd. N||||||
||||||Incorporation|
|Chengdu Hangzhongneng Steam||||||
|turbine Technology Sevrvice Co.,|Chengdu Sichuan|Chengdu Sichuan|Service|60.00%||
|Ltd||||||
|Luoyang Hangzhongneng Steam||||||
||||||Incorporation|
|turbine Technology Sevrvice Co.,|Luoyang Henan|Luoyang Henan|Service|60.00%||
|Ltd||||||
||||||Incorporation|
|Hangzhou Steam turbine Boiler|Hangzhou|Hangzhou||||
||||Manufacturing|50.00%||
|Co., Ltd.|Zhejiang|Zhejiang||||
|Hangzhou Zhongneng Steam||||||
||||||Incorporation|
||Indonesia|Indonesia|Manufacturing|70.00%||
|turbine (Indonesia) Co., Ltd||||||
||||||Incorporation|
|Hangzhou Kaineng Casting Co.,|Hangzhou|Hangzhou||||
||||Manufacturing|100.00%||
|Ltd|Zhejiang|Zhejiang||||
|Zhejiang Runhong Burming|Hangzhou|Hangzhou||||
||||||Incorporation|
||||Manufacturing|58.00%||
|Machine Engineering Co., Ltd|Zhejiang|Zhejiang||||
||||||Incorporation|
|Zhejiang Zhongrun Burning||||||
||Huzhou Zhejiang|Huzhou Zhejiang|Manufacturing|55.55%||
|machine Technology Co., Ltd||||||

（2）Major non-fully-Owned subsidiaries
In RMB
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||
|-|-|-|-|-|
||Share protion|Gains/loss of the|Dividend announced in|Balance of eqiuty of|
|Name of the subsidiaries|of minor|period attributable to|the period to minor|minor shareholders at|
||shareholders|minor shareholders|shareholders|end of period|
|Zhejiang Steam Trubine Packaged|||||
||29.14%|800,412.38|2,229,600.00|21,839,491.20|
|Technologies Development Co., Ltd.|||||
|Hangzhou Zhongneng Steam turbine|||||
||39.17%|-1,237,068.91|3,917,200.00|130,094,169.76|
|PowerCo., Ltd.|||||
|Hangzhou Steam Turbine Casting Co., Ltd.|49.00%|2,850,729.66|9,702,000.00|79,055,945.25|
|Hangzhou Steam Turbine Machinery|||||
||48.00%|11,315,541.93|21,600,000.00|60,700,450.90|
|Equipment Co., Ltd.|||||
|Hangzhou Steam Turbine Auxiliary|||||
||12.47%|2,733,628.42|2,992,800.00|27,530,188.29|
|Machinery Co., Ltd.|||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 (3) Material financial information of major non-fully-owned subsidiaries
In RMB
||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|
||End of term||||||Beginning of term||||||
|Subsidiaries Name||Non-current||Current|Non-current|||||Current|Non-current||
||Current assets||Total of assets|||Total of liabilit|y Current assets|Non-current asset|sTotal of assets|||Total of liabilit|
|||assets||liabilities|liabilities|||||liabilities|liabilities||
|Zhejiang Steam trubine|||||||||||||
||269,344,697.|23,763,573.8|293,108,271.|218,161,493.||218,161,493.|||279,877,771.|191,451,594.||191,451,594.|
|Packaged Technology|||||||255,821,238.00|24,056,533.07|||||
||59|9|48|18||18|||07|17||17|
|Development Co., Ltd.|||||||||||||
|Hangzhou Zhongneng Steam|||||||||||||
||986,770,801.|72,861,237.4|1,059,632,03|745,464,675.||747,202,675.|||960,130,000.|623,195,514.||623,525,514.|
||||||1,738,000.00||884,998,690.44|75,131,310.55|||330,000.00||
|turbine PowerCo., Ltd.|41|0|8.81|96||96|||99|10||10|
|Hangzhou Steam Turbine|||||||||||||
||229,398,790.|188,438,223.|417,837,013.|246,496,244.|10,002,105.0|256,498,349.|||406,270,109.|230,708,288.||240,710,393.|
||||||||211,392,397.15|194,877,712.30|||10,002,105.00||
|Casting Co., Ltd.|06|13|19|42|0|42|||45|79||79|
|Hangzhou Steam Turbine|||||||||||||
||189,297,411.|21,148,841.5|210,446,253.|83,986,980.4||83,986,980.4|||222,830,937.|75,404,339.6||75,404,339.6|
|Machinery Equipment Co.,|||||||200,333,215.84|22,497,721.65|||||
||54|8|12|1||1|||49|7||7|
|Ltd.|||||||||||||
|Hangzhou Steam Turbine|||||||||||||
||383,280,878.|117,672,960.|500,953,839.|279,861,691.||280,182,481.|||548,004,777.|324,598,336.||324,919,126.|
||||||320,790.00||432,548,733.64|115,456,043.82|||320,790.00||
|Auxiliary Machinery Co., Ltd.|88|20|08|50||50|||46|06||06|

In RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||Amount of current period||||Amount of previous period||||
|Subsidiaries Name|||||||||
|||||Cash flow for||||Cash flow for|
||Turnover|Net profit|Total Misc Gains||Turnover|Net profit|Total Misc Gains||
|||||business activities||||business activities|
|Zhejiang Steam Turbine Packaged|||||||||
||95,183,579.66|2,530,829.59|2,530,829.59|9,781,050.35|83,612,988.73|3,773,929.86|3,773,929.86|16,927,682.56|
|Technology Development Co., Ltd|||||||||
|Hangzhou Zhongneng Steam turbine|308,881,733.81|-4,491,604.31|-4,491,604.31|10,110,775.10|341,837,358.58|-5,746,192.61|-5,746,192.61|24,130,671.69|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||||||||
|-|-|-|-|-|-|-|-|-|
|Power Co., Ltd.|||||||||
|Hangzhou Steam Turbine Casting Co.,|||||||||
||144,755,281.64|5,817,815.64|5,817,815.64|422,629.68|154,101,020.08|3,014,779.43|3,014,779.43|-7,002,715.11|
|Ltd.|||||||||
|Hangzhou Steam Turbine Machinery|||||||||
||112,615,226.37|23,574,045.69|23,574,045.69|36,474,841.23|87,048,057.73|20,374,232.88|20,374,232.88|20,967,344.33|
|Equipment Co., Ltd.|||||||||
|Hangzhou Steam Turbine Auxiliary|||||||||
||214,290,527.44|21,921,639.27|21,921,639.27|30,104,537.33|170,532,221.25|12,008,146.90|12,008,146.90|20,063,610.04|
|Machinery Co., Ltd.|||||||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 X. Risks related to financial instruments
The objective of theCompany’s risk management is to achieve a balance between the risk and gains. Constrain the negative influence on business operation to the lowest limit, and maximum the interests of shareholders and other equity holders. With regard to this target, the basic policies of the Company are; locate and analyse the risks, set appropriate bottom line for risks, and manage and monitor on each risk and constrain them in a certain extent. Risks attached to financial instruments are mainly credit risks, liquidity risks, and market risks.
The following risk managing policies have been examined and approved by the management:
(I) Credit risks
Credit risks are introduced when one party of the financial instrument failed to exercise its liabilities and then caused financial loss to another.
The credit risks of the Company are mainly composed by bank savings and receivable accounts. Following measurements are adopted to control these risks:
1. Bank deposit
The Company puts its bank savings in financial institutions with higher credit ranks, therefore with lower risks. 2. Account receivable
The Company performs credit assessment on the clients on periodic and constant basis. Results suggested by the assessment are used by the Company to determine clients with higher ranks and to overlook the rest. This was conducted to avoid risks brought by material bad debts.
As the Company only does business with recognized and reputable third parties, so no collateral is needed. Credit risks are centralized managed in accordance with customers. As of June 30, 2017, the Company has a characteristic of specific credit risk concentration.40.97% (December 31, 2016:41.79%) of the Company's accounts receivable comes from the top five customers. The Company does not hold any collateral or other credit enhancement for the balance of accounts receivable.
(1) Analyzing of receivable accounts neither due nor impaired, and those have due but not impaired:
|||||||
|-|-|-|-|-|-|
|Items|End of term|||||
||Not overdue and notimpaired|Overdue but not impaired|||Total|
|||Within 1 year|1-2 years|Over 2 years||
|Bill receivable|696,089,138.4||||696,089,138.4|
|Subtotal|696,089,138.4||||696,089,138.4|

 (Continued)
|||||||
|-|-|-|-|-|-|
|Items|Beginning of term|||||
||Not overdue and notimpaired|Overdue but not impaired|||Total|
|||Within 1 year|1-2 years|Over 2 years||
|Bill receivable|479,716,321.62||||479,716,321.62|
|Subtotal|479,716,321.62||||479,716,321.62|

(2) See the accounts receivable of the individual impairment losses in the notes to the financial statement,
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 the explanation for the accounts receivable of the financial statement item.
(II) Liquidation risks
Liquidation risks are the possibilities of short in cash at fulfilling liabilities of payment or settlement for financial assets. They may be caused by failing to cash financial assets at fair value instantly;debtors’ failing of paying debts due; debts due before schedule; or failing of generating expected cash flow.
To handle these risks, the Company adopted multiple measures such as note clearance and bank loans. Long-term and short-term financing approaches were used to maintain balance between constancy and flexibility. The Company has obtained credit from multiple banks to satisfy the needs of business operation and capital output.
Categorizing of financial liabilities on remained period to due
|||||||
|-|-|-|-|-|-|
|Items|End of term|||||
||Book value|Contract amount notdiscounted|within 1 year|1-3 years|Over 3 years|
|Financial liabilities||||||
|Short-term loans|197,700,000.00|201,600,408.27|201,600,408.27|||
|Notes payable|151,467,745.11|151,467,745.11|151,467,745.11|||
|Non-current liabilitiesdue to 1 year|18,300,000.00|18,347,631.00|18,347,631.00|||
|Long-term loan|4,900,000.00|5,066,355.00||5,066,355.00||
|Long-term payable|208,330,000.00|222,751,733.33||24,779,733.33|197,972,000.00|
|Account payable|1,098,063,222.70|1,098,063,222.70|1,098,063,222.70|||
|Other account payable|29,028,860.33|29,028,860.33|29,028,860.33|||
|Subtotal|1,707,789,828.14|1,726,325,955.74|1,498,507,867.41|29,856,088.33|197,972,000.00|

 (Continued)
|||||||
|-|-|-|-|-|-|
|Items|Beginning of term|||||
||Book value|Contract amount notdiscounted|within 1 year|1-3 years|Over 3 years|
|Financial liabilities||||||
|Short-term loans|173,000,000.00|177,681,933.75|177,681,933.75|||
|Notes payable|143,007,715.10|143,007,715.10|143,007,715.10|||
|Non-current liabilitiesdue to 1 year|18,500,000.00|19,583,120.86|19,583,120.86|||
|Long-term loan|4,900,000.00|5,145,034.03||5,145,034.03||
|Long-term payable|208,027,733.33|223,972,000.00||26,000,000.00|197,972,000.00|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||
|-|-|-|-|-|-|
|Account payable|853,452,589.51|853,452,589.51|853,452,589.51|||
|Other account payable|30,820,980.80|30,820,980.80|30,820,980.80|||
|Subtotal|1,431,709,018.74|1,453,663,374.05|1,224,546,340.02|31,145,034.03|197,972,000.00|

 (III) Market risks
Market risks are those brought by change of fair value or expectable cash flow of financial instruments due to change of market prices, mainly interest risks and exchange rate risks.
1. Interest risks
Interest risks are those brought by change of fair value or expectable cash flow of financial instruments due to change of interest rates, mainly regards the loans at floating interest rates.
2. Foreign currency risks
Foreign currency risks (exchange rate risks) are those caused by change of fair value or expectable cash flow of financial instruments due to fluctuation of exchange rates. These risks are mainly related to foreign currency assets and liabilities. The Company operates in mainland China and mostly uses RMB as standard currency, therefore no major risks regarding exchange rates. For details of foreign currency assets and liabilities, please go to the descriptions in the notes to the consolidated financial statements.
XI. Related parties and related transactions
1. Parent company of the Company
|||||||
|-|-|-|-|-|-|
|||Business||Shareholding of the parent|Voting rights of the parent|
|Name of the parent co.|Reg. Add.||Registered capital|||
|||property||co.|co. %|
|Hangzhou Steam|Hangzhou|||||
|||Manufacturing|RMB 800 milllion|63.64%|63.64%|
|Turbine Group|China|||||

Hangzhou Municipal Government State-owned Asset Supervisory Committee is the ultimate controller of theCompany.。
2. For details of subsidiaries please go to the statement of equities in other entities.
3. Other related parties
|||
|-|-|
|Name of the related parties|Relationship with the Company|
|Hangzhou Steam turbine Automobile sales service Co., Ltd.|Affiliate of the Group|
|Hangzhou Hangfa Power Generating Equipment Co., Ltd.|Affiliate of the Group|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||
|-|-|
|Hangzhou Nanfangtongda Gears Co., Ltd.|Affiliate of the Group|
|Hangzhou Nanhua Wooden Packaging Co., Ltd.|Affiliate of the Group|
|Hangzhou Steam Turbine Industrical Co., Ltd.|Affiliate of the Group|
|Hangzhou Steam Turbine Power Technologies Co., Ltd.|Affiliate of the Group|
|Hangzhou Steam Turbine Engineering Co., Ltd.|Affiliate of the Group|
|Hangzhou Steam Turbine Power Group Equipment Co., Ltd.|Affiliate of the Group|
|Hangzhou Steam Turbine Electronic Tube Co., Ltd.|Affiliate of the Group|
|Hangzhou Steam Turbine Compressor Co., Ltd.|Affiliate of the Group|
|HSTG(Hangzhou )Union Research Co., Ltd|Affiliate of the Group|
|Hangzhou Wandong Electric Co., Ltd|Affiliate of the Group|
|Greenesol Co.(India)|Affiliate of the Group|
|HangzhouSteam Turbine Industry & Trade Co., Ltd.|Affiliate of the Group|
|Zhejiang Juqing Investment Co., Ltd.|Affiliate of the Group|

4.Related transaction
(1) Sale of goods/rendering of labor services/labor service offering
Purchase of goods and service
In RMB
|||||||
|-|-|-|-|-|-|
|||Amount of current|Amount of previous|Over the||
||Content of related|||trading|Amount of last|
|Ralated parties||||||
|||period|period|||
||transaction|||limit or|period|
|||||not?||
|Hangzhou Steam turbine Automobile sales service|Transportation ,|||||
|||22,740,891.37|22,740,891.37|No|22,025,165.68|
|Co., Ltd.|repair , etc.|||||
|Hangzhou Hangfa Power Generating Equipment||||||
||Generators|56,688,888.99|56,688,888.99|No|66,620,352.11|
|Co., Ltd.||||||
|Hangzhou Nanhua Wooden Packaging Co., Ltd.|Packaging|5,928,878.83|5,928,878.83|No|7,597,558.46|
|Hangzhou Nanfang Tongda Gears Co., Ltd.|Gear boxes|5,635,780.34|5,635,780.34|No|1,806,463.25|
||Raw materials|||||
|Hangzhou Steam Turbine Industrial Co., Ltd.|processing ,|482,896.70|482,896.70|No|640,102.34|
||cleaning fees, etc.|||||
|Hangzhou Steam Turbine Group|Equipment|||||
|||7,154,774.65|7,154,774.65|No|6,699,607.87|
||maintenance|||||
|HSTG Technology Association|Industrial|||||
|||||No||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||
|-|-|-|-|-|-|
||cooperation|||||
|Greenesol Co. (India)|Generators|34,062.49|34,062.49|No||
|HSTG (Hangzhou) United Institutes Co., Ltd.|Law material|677,912.62|677,912.62|No|277,500.00|
|Hangzhou Steam Turbine Engineering Co., Ltd.|Technical service|86,792.45|86,792.45|No|2,420,773.08|
|Hangzhou Steam Turbine Electronic Tube Co., Ltd.|Law material|||No||
||Industrial|||||
|Hangzhou Wandong Electric Co., Ltd.||||No|13,333.33|
||cooperation|||||
|Hangzhou Steam Turbine Industry & Trade Co.,|Grinding service|||||
|||2,368,081.20|2,368,081.20|No||
|Ltd.|fee|||||
|Subtotal||101,798,959.64|101,798,959.64|No|108,100,856.11|

 Related transactions regarding sales of goods or providing of services
In RMB
|||||
|-|-|-|-|
||Subjects of the related|||
|Related parties||Current term|Same period of last term|
||transactions|||
|Hangzhou Hangfa Power Generating Equipment|Cast parts, industrial|||
|||5,756,434.06|5,447,419.07|
|Co., Ltd.|co-operation|||
|Hangzhou Steam Turbine Engineering Co., Ltd.|Steam turbine|28,790,427.34|136,752.14|
|Hangzhou Steam Turbine Group|Development services|45,283.02|376.09|
|Hangzhou Steam Turbine Automobile Sales||||
||Small amount materials|24,077.26||
|Service Co., Ltd.||||
|Hangzhou Nanhua Wooden Packaging Co., Ltd.|Small amount materials|||
|Greenesol Co.(India)|Part|422,686.78|1,664,712.44|
||Compressor,Industrial|||
|Hangzhou Steam Turbine Compressor Co., Ltd.||34,012.82|76,923.08|
||cooperation|||
|Subtotal||35,072,921.28|7,326,182.82|

（2）Information of related lease
The Company was lessor
In RMB
|||||
|-|-|-|-|
||Category of lease|The lease income confirmed in|The lease income confirmed in|
|Name of lessee||||
||assets|this year|last year|
|HSTG||||
||House and Building|677,309.71|474,116.80|
|Hangzhou Steam Turbine Automobile Sales|Site leasing|1,397,601.51|782,514.62|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||
|-|
|Service Co., Ltd.|

（3）Related-party guarantee
The Company was guarantor
In RMB
||||||
|-|-|-|-|-|
|||||Execution|
|Guarantor|Guarantee amount|Start date|End date|accomplished or|
|||||not|
|HSTG|100,000,000.00|December 18,2017|December 18,2019|No|

 Notes
in accordance with the National Development Fund Investment Contract, jointly signed by the Company, NDF, Turbine Industry Company and Hangzhou Steam Turbine Group, the investment of the NDF on Turbine Industry Company, RMB 20,800,000.00, is repurchased by the Hangzhou Steam Turbine Group, and the NDF asks the Company and Hangzhou Steam Turbine Group to provide guarantee for the fulfillment of Hangzhou Steam Turbine Group of the transferee equity obligations. The Company and Steam Turbine Company pledge to the NDF with a total of 23 million shares of Hangzhou Bank Co., Ltd. with book value of RMB 481,850,000.00 and the land use right with book value of RMB 69,631,244.57.
4. Remunerations of key managements
In RMB
||||
|-|-|-|
|Items|Current term|Same period of last term|
|Remunerations of key managements|2,116,859.61|2,269,038.36|

 5. Other related transactions
(1) Service and power supply
HSTG supplies water and power to the Company and some of the subsidiaries amounted to RMB6,069,868.99 this period.
Hangzhou Steam Turbine Automobile Sales& Service Co., Ltd. provided transportation to theCompany’s employees and RMB1,105,560 was paid this period.
Hangzhou Steam Turbine Industry Co., Ltd. provided cleaning services to the Company and RMB708,176.09 was paid this period.
HSTC pay the wages on behalf and newspapers fee of the company , this period occurred RMB767,548.28 and RMB 1,740,399.52.
(2) Using of trademark
The Company pays RMB495,163.96 to HSTG for using of the registered trademark.
6. Receivables and payables of related parties
（1）Receivables
In RMB
|||||
|-|-|-|-|
|Name|Related party|End of term|Beginning of term|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||||
|-|-|-|-|-|-|
|||Book balance|Bad debt provision|Book balance|Bad debt provision|
|Account|Hangzhou Steam Turbine Engineering|||||
|||66,174,395.99|6,767,458.59|52,898,295.99|6,117,053.80|
|receivable|Co., Ltd.|||||
||Hangzhou Hangfa Power Generating|||||
|||21,483,302.40|1,428,322.45|17,950,170.60|1,146,223.10|
||Equipment Co., Ltd.|||||
||Hangzhou Steam Turbine Power Group|||||
||Complete Equipment Engineering Co.,|305,000.00|244,000.00|305,000.00|244,000.00|
||Ltd.|||||
||Hangzhou Steam Turbine Compressor|||||
|||59,000.00|5,900.00|59,000.00|5,900.00|
||Co., Ltd.|||||
||Hangzhou Steam Turbine Power Group|||||
|||158,500.00|158,500.00|158,500.00|158,500.00|
||Co., Ltd.|||||
||Hangzhou Steam Turbine Automobile|||||
|||||544.67|27.23|
||Sales Service Co., Ltd.|||||
||Greenesol Co.(India)|17,411,522.43|13,575,418.13|15,642,523.36|12,514,018.69|
|Subtotal||105,591,720.82|22,179,599.17|87,014,034.62|20,185,722.82|
||Hangzhou Steam Turbine Engineering|||||
|Prepayment||2,272,000.00||||
||Co., Ltd.|||||
||Hangzhou Hangfa Power Generating|||||
|||49,157,785.00||21,515,346.37||
||Equipment Co., Ltd.|||||
||Hangzhou Nanfang Tongda Gears Co.,|||||
|||455,000.00||||
||Ltd.|||||
|Subtotal||51,884,785.00||21,515,346.37||

（2）Payables
In RMB
|||||
|-|-|-|-|
|Name|Related party|Amount at year|Amount at year beginning|
|Account payable|Hangzhou Hangfa Power Generating Equipment Co., Ltd.|151,726,504.75|115,744,578.95|
||Greenesol Co.(India)|3,510,877.24|3,595,145.76|
||Hangzhou Steam Turbine Power Group Co., Ltd.|15,707,353.86|3,395,546.79|
||Hangzhou Steam Turbine Automobile Sales Service Co.,|||
|||8,089,221.80|7,504,708.74|
||Ltd|||
||Hangzhou Nanhua Wooden Packaging Co., Ltd.|1,111,165.97|963,509.03|
||Hangzhou Steam Turbine Engineering Co., Ltd.|1,690,000.00|1,780,566.04|
||HSTG (Hangzhou) United Institutes Co., Ltd.|306,375.00|597,075.00|
||Hangzhou Nanfang Tongda Gears Co., Ltd.|4,230,250.00|2,464,950.00|
||Hangzhou Steam Turbine Industrial Co., Ltd.|212,774.10|212,294.57|
||Hangzhou Wandong Electric Co., Ltd.|0.00|20,640.00|
|Subtotal||186,584,522.72|136,279,014.88|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||
|-|-|-|-|
|Advances received|Hangzhou Steam Turbine Engineering Co., Ltd.|53,933,290.00|38,972,720.00|
||Hangzhou Steam Turbine Compressor Co., Ltd.|14,310,724.49|14,190,000.00|
||Greenesol Co.(India)|84,526.93||
|Subtotal||68,328,541.42|53,162,720.00|
|Other account||||
||Hangzhou Steam Turbine Group|2,737,187.43|5,731,384.50|
|payable||||
||Hangzhou Steam Turbine Automobile Sales Service Co.,|||
|||100,000.00|100,000.00|
||Ltd.|||
|Subtotal||2,737,187.43|5,831,384.50|

 XII. Other Material Issues
Segment information
1. Recognition of segments and accounting policies
Business segments are determined according to the administration structure, management requirement, and internal reporting mechanism. Segments are parts of theCompany’s business satisfying all of the following conditions:
(1) Generate revenue and expenses in daily operations;
(2) Operational results can be assessed by the management to decide the resources to be allocated;
(3) Financial position, business results, and cash flow of the part is accessible through analyzing.
2. Reasons of not being able to report about the segments
TheCompany’s business range is relatively narrow and mainly involved in producing and selling of steam turbines, gas turbines and auxiliary machinery and parts. It is regarded as an integral business by the management. Therefore segment report is not included in this report.
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 XIII. Notes to the Financial Statements of the Parent Co.
1. Account receivable
（1）Detailed categories
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||End of term|||||Beginning of term|||||
|Category|Book balance||Bad debt provision|||Book balance||Bad debt provision|||
||||||Book value|||||Book value|
||Amount|Proportion|Amount|Proportion||Amount|Proportion|Amount|Proportion||
|Account receivables|||||||||||
|provided bad debt|||||||||||
||2,079,709,555.62|98.59%|775,959,401.58|37.31%|1,303,750,154.04|2,177,424,114.16|98.65%|752,473,417.58|34.56%|1,424,950,696.58|
|provision in credit risk|||||||||||
|groups|||||||||||
|Account receivable|||||||||||
|with minor individual|||||||||||
||29,819,607.69|1.41%|29,819,607.69|100.00%|0.00|29,819,607.69|1.35%|29,819,607.69|100.00%||
|amount but bad debt|||||||||||
|provision is provided|||||||||||
|Total|2,109,529,163.31|100.00%|805,779,009.27|38.20%|1,303,750,154.04|2,207,243,721.85|100.00%|782,293,025.27|35.44%|1,424,950,696.58|

 Receivables with individually significant amount and provision for bad and doubtful debts individually provided at the end of the reporting period.
Not applicable
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Receivable accounts in the group on which bad debt provisions are provided on age basis
In RMB
|||||
|-|-|-|-|
||End of term|||
|Aging||||
||Other receivable account|Bad debt provision|Proportion%|
|Subitem within 1 year||||
|Within 1 year|556,071,174.35|27,803,558.71|5.00%|
|Subtotal within 1 year|556,071,174.35|27,803,558.71|5.00%|
|1-2 years|342,131,995.28|34,213,199.53|10.00%|
|2-3 years|312,878,346.40|93,863,503.92|30.00%|
|Over 3 years|786,450,051.61|620,079,139.42||
|3-4 years|331,895,783.51|199,137,470.11|60.00%|
|4-5 years|168,062,993.95|134,450,395.16|80.00%|
|Over 5 years|286,491,274.15|286,491,274.15|100.00%|
|Total|1,997,531,567.64|775,959,401.58|38.85%|

 Receivable accounts combined within consolidating range for providing of bad debt provisions
|||||
|-|-|-|-|
|Name|End of term|||
||Book balance|Bad debt provision|Providing rate %|
|Combinations of related transactions inconsolidation range|82，177，987.98|||
|Subtotal|82，177，987.98|||

Remarks on deciding of combinations:
Receivable accounts and other receivable accounts within the consolidation range are tested for impairment individually. No bad debt provision is provided in case there is no impairment occurred.
Receivables with provision for bad and doubtful debts based on the balance percentage method in the portfolio Not applicable
Receivables with provision for bad and doubtful debts based on the other method in the portfolio
Nil
(2) Provision of allowance for doubtful debts within this year is RMB27,582,445.00 and no recovery or reversal of provision during the year.
(3) Receivable accounts actually written off in the report period
In RMB
|||
|-|-|
|Items|Amount|
|Uncollectible amount|4,096,461.00|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 The significant actual write-off accounts receivable:
In RMB
|||||||
|-|-|-|-|-|-|
||Nature of|||||
||||Reason for|Verification|Arising from related|
|Name|account|Amount written off||||
||||written-off|procedures|transactions(Y/N)|
||receivable|||||
|||||The examined and||
|China Air Separation Engineering Co., Ltd.|Goods|1,674,643.00|quality loss|adopted to Board|No|
|||||of directors||
|||||The examined and||
|Huaneng Energy saving Powergeneration Co.,||||||
||Goods|760,000.00|quality loss|adopted to Board|No|
|Ltd.||||||
|||||of directors||
|||||The examined and||
||||Debt|||
|Tangshan Yanshan Steel Co.,Ltd.|Goods|623,280.00||adopted to Board|No|
||||Restructuring|||
|||||of directors||
|||||The examined and||
|Inner Mongolia Runbang Biogechnology Co.,||||||
||Goods|620,000.00|quality loss|adopted to Board|No|
|Ltd.||||||
|||||of directors||
|||||The examined and||
||||allowance|||
|Other|Goods|418,538.00||adopted to Board|No|
||||method|||
|||||of directors||
|Total|--|4,096,461.00|--|--|--|

 Notes：
（4）Receivables account of the top five parties
|||||
|-|-|-|-|
|Name|Amount|Proportion(%)|Bad debt provision|
|Client 1|600,440,422.92|28|273.708.897.87|
|Client 2|301,330,454.20|14|175,770,724.20|
|Client 3|61,659,500.00|3|3,164,975.00|
|Client 4|57,859,245.99|3|5,861,438.59|
|Client 5|35,751,500.00|2|1,787,575.00|
|Subtotal|1,057,041,123.11|50|460,293,610.66|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 2. Other account receivable
In RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
||End of term|||||Beginning of term|||||
||Book balance||Bad debt provision|||Book balance||Bad debt provision|||
|Category|||||||||||
|||Proportion|||Book value||Proportion||Proportion|Book value|
||Amount||Amount|Proportion %||Amount||Amount|||
|||%|||||%||%||
|Other receivables provided bad|||||||||||
|debt provision in credit risk|12,963,578.72|100.00%|6,246,660.52|48.19%|6,716,918.20|74,189,903.93|100.00%|6,185,197.69|8.34%|68,004,706.24|
|groups|||||||||||
|Total|12,963,578.72|100.00%|6,246,660.52|48.19%|6,716,918.20|74,189,903.93|100.00%|6,185,197.69|8.34%|68,004,706.24|

 Other Receivable accounts with large amount individually and bad debt provisions were provided
Not applicable
Other receivable accounts in the group on which bad debt provisions are provided on age basis
In RMB
|||||
|-|-|-|-|
||End of term|||
|Age||||
||Other receivable account|Bad debt provision|Proportion%|
|Subitem within 1 year||||
|Within 1 year|3,182,783.71|159,139.19|5.00%|
|Subtotal within 1 year|3,182,783.71|159,139.19|5.00%|
|1-2 years|1,253,519.24|125,351.92|10.00%|
|2-3 years|1,363,026.90|408,908.07|30.00%|
|Over 3 years|6,050,215.34|5,553,261.34||
|3-4 years|1,203,039.00|721,823.40|60.00%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
|||||
|-|-|-|-|
|4-5 years|78,692.00|62,953.60|80.00%|
|Over 5 years|4,768,484.34|4,768,484.34|100.00%|
|Total|11,849,545.19|6,246,660.52|52.72%|

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 Notes：
Receivable accounts combined within consolidating range for providing of bad debt provisions
|||||
|-|-|-|-|
|Name|End of term|||
||Book balance|Bad debt provision|Providing rate %|
|Combinations of related transactionsin consolidation range|1，114，033.53|||
|Subtotal|1，114，033.53|||

Remarks on deciding of combinations:
Receivable accounts and other receivable accounts within the consolidation range are tested for impairment individually. No bad debt provision is provided in case there is no impairment occurred.
Other receivables with provision for bad and doubtful debts based on the balance percentage method in the portfolio
Not applicable
Other receivables with provision for bad and doubtful debts based on the other method in the portfolio
Not applicable
（2）Bad debt provision withdrawal, reversed or recovered in the report period.
Provision of allowance for doubtful debts within this year is RMB 61,462.83 and no recovery or reversal of provision during the year.
(3) Combination of other receivable accounts
In RMB
||||
|-|-|-|
|Property|End of term|Beginning of term|
|Related party funds|1,114,033.53|60,000,000.00|
|Deposit|6,460,710.00|13,039,563.14|
|Petty cash|4,935,171.59|167,900.00|
|Provisional payment receivable|453,663.60|982,440.79|
|Total|12,963,578.72|74,189,903.93|

(4) Top 5 of the closing balance of Other accounts receivable
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 In RMB
|||||||
|-|-|-|-|-|-|
||Account|||Percentage in total||
|Name of the company||Book balance|Age||Bad debt provision|
||property|||other receivable %||
||Deposit in|||||
|Shanghai Customs Waigaoqiao Office||3,710,320.94|Over 5 years|28.62%|3,710,320.94|
||custom|||||
|Guodian Trust Bidding Co., Ltd.|Deposit in||Within 1 year, over 5|||
|||1,294,500.00||9.99%|539,725.00|
||custom||years|||
|Guoxin Bidding Group Co., Ltd.|Deposit in|||||
|||849,500.00|1-2 years, over 5 years|6.55%|129,500.00|
||custom|||||
|China Electric Power Complete||||||
||Services|728,000.00|Within 1 year|5.62%|36,400.00|
|Equipment Co., Ltd.||||||
|Guodian Longyuan Power Technology|Deposit in|||||
|||500,000.00|3-4 years|3.86%|300,000.00|
|Engineering Co., Ltd.|custom|||||
|Total|- -|7,082,320.94|- -||4,715,945.94|

 3. Long-term share equity investment
In RMB
||||||||
|-|-|-|-|-|-|-|
||End of term|||Beginning of term|||
|||Impairm|||Impair||
|Items||ent|||ment||
||Book balance||Book value|Book balance||Book value|
|||provisio|||provisi||
|||n|||on||
|Investment on|||||||
||502,919,378.03||502,919,378.03|502,919,378.03||502,919,378.03|
|subsidiaries|||||||
|Total|502,919,378.03||502,919,378.03|502,919,378.03||502,919,378.03|

（1）Investment to the subsidiary
In RMB
||||||||
|-|-|-|-|-|-|-|
||||||Withdrawn||
|||||||Closing|
||||||impairment||
|||||||balance of|
|Name|Opening balance|Increase|Decrease|Closing balance|provision in||
|||||||impairment|
||||||the reporting||
|||||||provision|
||||||period||
|Touping Imports & Exports Co.|20,000,000.00|||20,000,000.00|||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Heavy Industry Co.|360,000,000.00|360,000,000.00|
|Auxiliary Machine Co|46,286,513.41|46,286,513.41|
|Packaged Co.|29,800,389.56|29,800,389.56|
|Zhongneng Co.|27,644,475.06|27,644,475.06|
|Machinery Co.|7,968,000.00|7,968,000.00|
|Casting Co.|11,220,000.00|11,220,000.00|
|Total|502,919,378.03|502,919,378.03|

4. Business income and Business cost
In RMB
||||||
|-|-|-|-|-|
||Amount of current period||Amount of previous period||
|Items|||||
||Revenue|Cost|Revenue|Cost|
|Main business|1,022,711,006.96|758,653,563.38|865,641,911.52|540,221,337.74|
|Other business|93,434,073.65|90,328,583.22|8,058,477.84|5,896,004.22|
|Total|1,116,145,080.61|848,982,146.60|873,700,389.36|546,117,341.96|

 5.Investment income
In RMB
||||
|-|-|-|
||Amount of current period|Amount of previous period|
|Items|||
|Investment income form holding available-for-sale equity|||
||43,203,908.24|2,587,659.70|
|instrument|||
|Investment income from disposal of available for sale|||
||25,121,648.20||
|financial assets|||
|Long-term equity investment income by Cost method|60,959,407.50|73,528,812.50|
|Investment income of financial products|12,028,688.59|2,697,347.51|
|Total|141,313,652.53|78,813,819.71|

 XIII. Supplement information
1. Particulars about current non-recurring gains and loss
In RMB
Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017
||||
|-|-|-|
|Items|Amount|Notes|
|Gains/losses from the disposal of non-current asset|180,553.42||
|Governmental subsidy calculated into current gains and loess（while closely related with the|||
|normal business of the Company, excluding the fixed-amount or fixed-proportion|2,505,237.27||
|governmental subsidy according to the unified national standard）|||
|Gains and losses from change of fair values of held-for-transaction financial assets and|||
|financial liabilities except for the effective hedge business related to normal business of the|||
||44,784,598.29||
|Company, and investment income from disposal of transactional financial assets and|||
|liabilities and financial assets available for sale|||
|Other non-business income and expenditures other than the above|1,590,730.74||
|Less: Influenced amount of income tax|7,982,642.11||
|Amount of influence of minority interests|642,891.62||
|Total|40,435,585.99|--|

For theCompany’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses and its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information Disclosure for Companies offering their securities to the public-non-recurring Gains and losses which have been defined as recurring gains and losses, it is necessary to explain the reason.
Not applicable
2. Return on equity (ROE) and earnings per share (EPS)
|||||
|-|-|-|-|
||Weighted|EPS（Yuan/share）||
|Profit as of reporting period|average ROE|||
|||EPS-basic|EPS-diluted|
||(%)|||
|Net profit attributable to common||0.06|0.06|
||0.69%|||
|shareholders of the Company||||
|Net profit attributable to common||||
|shareholders of the Company after||||
||0.06%|0.005|0.005|
|deduction of non-recurring profit||||
|and loss||||

Hangzhou Steam Turbine Co., Ltd. Semi-Annual Report 2017 XI. Documents for Reference
(I) Financial Statements signed and sealed by the Chairman of the Board , chief accountant and director of the financial division;
(II) All the originals of theCompany’s documents and public notices disclosed in the newspapers
designated by China Securities Regulatory Commission in the report period;
(III) Original copy of Resolutions of the 13th Meeting of the 7th Term of Board.
Hangzhou Steam Turbine Co., Ltd.
Chairman of the Board: Zheng Bin
August 18, 2017