Shandong Airlines Co., Ltd. Summary of Annual Report 2013 Shandong Airlines Co., Ltd.
Summary of Annual Report 2013
1. Important Notice
The summary is abstract from full-text of annual report, for more details information, investors should found in the full-text of annual report that published on website of Shenzhen Stock Exchange and other website appointed by CSRC.
Company Profile
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|Short form of the stock|Shanhang B|Stock code||200152|
|Stock exchange for listing|Shenzhen Stock Exchange||||
|Person/Way to contact|Secretary of the Board||Secretary of the Board||
|Name|Dong Qiantang||Fan Peng||
|Tel.|0531－85698229||0531－85698678||
|Fax.|0531－85698767 ext.8679||0531－85698767 ext.8679||
|E-mail|dongqt@shandongair.com.cn||fanp@shandongair.com.cn||

2. Main financial data and changes of shareholders
(1) Main financial data
Whether it has retroactive adjustment or re-statement on previous accounting data for accounting policy changed and accounting error correction or not
□ Yes√ No
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||||Changes over last||
||2013|2012||2011|
||||year (%)||
|Operating income (RMB)|11,427,157,933.15|10,993,024,914.41|3.95%|9,666,969,745.20|
|Net profit attributable to shareholders|389,081,811.72|589,810,932.47|||
||||-34.03%|771,225,549.05|
|of the listed company(RMB)|||||
|Net profit attributable to shareholders|||||
|of the listed company after deducting|137,850,318.37|490,146,637.15|-71.88%|751,635,820.83|
|non-recurring gains and losses(RMB)|||||
|Net cash flow arising from operating|1,411,186,522.15|1,726,317,500.75|||
||||-18.25%|2,245,050,664.90|
|activities(RMB)|||||
|Basic earnings per share (RMB/Share)|0.97|1.47|-34.01%|1.93|
|Diluted earnings per share|0.97|1.47|||
||||-34.01%|1.93|
|(RMB/Share)|||||
||||11.28 percentage||
|Weighted average ROE (%)|15.08%|26.36%||45.05%|
||||down||
||End of 2013|End of 2012|Changes over end of|End of 2011|
||||last year (%)||
|Total assets (RMB)|11,403,124,428.82|11,261,341,430.03|1.26%|9,772,985,545.97|
|Net assets attributable to shareholder of|2,708,137,664.00|2,479,055,852.28|9.24%|2,049,244,919.81|

Shandong Airlines Co., Ltd. Summary of Annual Report 2013
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|listed company (RMB)|

(2) Statement of shares held by top 10 shareholders
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|-|-|-|-|-|-|-|-|-|-|
|||||Total shareholders ended as the||||||
|Total shareholders in reporting||||||||||
||17,064|||5th trading day before annual|||17,034|||
|period||||||||||
|||||report disclosed||||||
|Particular about shares held by top ten shareholders||||||||||
|||||||Amount of||Shares pledge or frozen||
||||Proportion of||Amount of|||||
|Shareholders||Nature||||restricted||||
||||shares held (%)||shares held|||Status|Amount|
|||||||shares held||||
|SHANDONG AVIATION GROUP||State-ownedlegal person|42%||168,004,000|168,004,000||||
|AIR CHINA LIMITED||State-ownedlegal person|22.8%||91,200,000|91,200,000||||
|GUOTAI JUNANSECURITIES(HONGKONG) LIMITED||Foreignlegal person|0.88%||3,537,773|0||||
|WANXIANG INTERNATIONALINVESTMENT CORPORATION||Foreignlegal person|0.45%||1,805,525|0||||
|Chen Jingjian||Domesticnaturalperson|0.36%||1,438,800|0||||
|Ou Yanping||Domesticnaturalperson|0.24%||945,043|0||||
|Yao Ming||Domesticnaturalperson|0.23%||927,000|0||||
|HUANG LIU LIA||Foreignnaturalperson|0.23%||918,917|0||||
|Ye Qufa||Domesticnaturalperson|0.2%||810,000|0||||
|Bao Xiuzhen||Domesticnaturalperson|0.2%||800,000|0||||
||||1. Shandong Aviation Group is the first largest shareholder of the|||||||
||||Company, who holds the shares of the Company on behalf of the State|||||||
||||with unlisted shares.|||||||
||||2. Air China Limited is the second largest shareholder of the Company,|||||||
||||who holds the shares of the Company on behalf of the State with unlisted|||||||
||||shares; Air China is the first largest shareholder of SDA and the actual|||||||
|Explanation on associated relationship among the||||||||||
||||controller of the Company.|||||||
|aforesaid shareholders||||||||||
||||3. Among the above the top ten shareholders, Air China is the first largest|||||||
||||shareholder of the SDA, and there exists no associated relationship|||||||
||||between SDA and Air China and the other shareholders, and they don’t|||||||
||||belong to the consistent actionist regulated by the Management Regulation|||||||
||||of Information Disclosure on Change of Shareholding for Listed|||||||
||||Companies with the other shareholders.|||||||

(3) Property right and controlling relationships between the actual controllers of the Company and the Company is as follows
Shandong Airlines Co., Ltd. Summary of Annual Report 2013 S h a nd o n g A vi a tio n G r o up
42%
Shandong Airlines Co., Ltd.
3. Discussion and analysis by the Management Team
In 2013, the Company calmly coped with the complex and severe situation of safety and benefits, scientifically deliberated the decisions, optimized and enhanced the management, united and worked hard, and overcome the challenges so that the safety, operation, benefits and services have maintained a good momentum, achieved a steady and rapid development, and obtained the hard-won business performance.
(1) Continue to strengthen the safety management, and safety production situation is basically stable
In 2013, the Companies guaranteed the safety flight of 257,600 hours and138,000 sorties, respectively increased by12.79% and12.41% year on year, and no transport and aviation accident proneness caused by the company occurred; further clarified the safety leadership responsibilities, detailed the safety regulatory responsibility, implemented the security posts responsibility, and continued to strengthen the security infrastructure; fully launched the safety production checking and soundly developed the key special renovation in accordance with the principle of "full coverage, zero tolerance, strict law enforcement, and pragmatics" and guiding by "five asks" and "three checks".
(2)Optimize and adjust the transport control system, the production runs properly
In 2013, theCompany’s average flight punctuality rate was78.17%, ranked third in the civil aviation; established the new operation and control center, the construction of the transport and control management system has achieved initial success; established and improved the policy standards relevant to the normal flight management, the normal flight management advanced steadily; successfully completed the air transport guarantee mission in "two sessions", "ten Arts Festival", national defense, andYa’an disaster relief.
(3) Actively and appropriately organize the production, and maintain a preferable income level
In 2013, the company completed the total transport turnover volume of 1,757,467,100 tons km, the passenger transport volume of 14,035,800 person-time, total mail volume 130,800 tons, respectively increased by10.42%,12.08%, and5.72% year on year; achieved operating income of 11,427,157,933.15 Yuan, increase by3.95% year on year, net profit of 389,081,811.72 Yuan, decreased by34.03% year on year; the passenger load factor was77.76%, decreased by1.31% year on year, and the cargo and mail load factor was46.69%, decreased by1.78% year on year; the Company continued to optimize the flight schedules and the airline network, gradually increased the flight numbers among the three bases so that the synergistic effect has gradually revealed; made progress in product innovation and channel development, and achieved remarkable results in increasing revenue and reducing expenditure.
(4) Continuously improve the service process, and the service quality has been improved
In 2013, the company's service process and standard optimization have been strongly boosted, the improvement for the service short slab made progress; overall passenger satisfaction survey score reached 89.72, increased by 0.34 scores year on year, which was 1.72 scores more than the target at the beginning of the year; the valid customer complaint rate was 0.486 per ten thousand person-time, which completed the target the company made at the beginning of the year; the brand value increased to 15.286 billion Yuan, ranked 121 in the ranking of China's 500 most valuable brands, and ranked 15 ahead compared to the last year.
4. Relevant items involving financial report
(1)Comparing with lastyear’s financial report, explain changes in aspect of accounting policy, accounting estimates and calculation measures
The “Proposal of Inventory Accounting Methods Changed” (found more in Notice No.: 2013-47) was deliberated and approved by 4th extraordinary meeting of 5th session of the Board dated 10 July 2013.
To achieve the integrated management of mechanical and financial and further enhance the Company's core competitiveness, the Company has started using SAP software since July 1st, 2013. In order to keep the same as the software, the inventory valuation method is changed from the "FIFO" to "moving weighted average method."
Shandong Airlines Co., Ltd. Summary of Annual Report 2013 The business scope involved in the change of accounting policies is the company's inventory and costing businesses, which can reflect thecompany’s financial situation and operating results more objectively and fairly and provide more reliable and accurate accounting information, the accounting policy changes will not make substantial impacts on theowners’ equity and net profits of the company.
(2)Particular about major accounting errors correction that needs retroactive re-statement in reporting period
No major accounting errors correction that needs retroactive re-statement in reporting period.
(3)Compare with lastyear’s financial report; explain changes in consolidationstatement’s scope
Scope of consolidation statement in this year is the same as lastyear’s
(4)Explanation from the Board and Supervisory Committee for “Qualified Opinion” from the CPA In reporting period, the Ruihua Certified Public Accountants (LLP) issued a standard unqualifiedauditors’ report for the Company. Board of Directors of
Shandong Airlines Co., Ltd.
March 20, 2014