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ZHEJIANG EXPRESSWAY CO LD - 2013 Interim Report

Friday, August 30, 2013 1:04 PM


ZHEJIANG EXPRESSWAY CO LD - 2013 Interim Report

ZHEJIANG EXPRESSWAY CO., LTD.
2013 Interim Report

Seizing Opportunities and March Forward

In the first half of 2013, China's economy remained stable, the economy of Zhejiang Province and foreign trade
continued to pick up, and the trading volume in the Shanghai and Shenzhen stock markets recovered. Against this
background, Zhejiang Expressway seized opportunities to drive business growth and boost business income as well
as profits. During the Period, the Group completed the acquisition of a 76.55% equity interest in the Jinhua
Section of the Ningbo-Jinhua Expressway, which has already contributed toll income to the Group. In addition, the
IPO application for the listing of Zheshang Securities in the A share market has been accepted by the China
Securities Regulatory Commission, and is on the waiting list for IPOs.
Looking forward to the second half of the year, we will continue to initiate actions to promote healthy business
development, reduce costs and enhance efficiency. We will also generate strategic synergies with our parent
company by seeking suitable investment projects, nurturing management capabilities in our diversified businesses
and utilizing our advantage in financial resources to expand the space for future development and to improve
profitability.

Contents

2013 Interim Results
Business Review
Financial Analysis
Outlook
Disclosure of Interests and Other Matters
Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income
Condensed Consolidated Statement of Financial Position
Condensed Consolidated Statement of Changes in Equity
Condensed Consolidated Statement of Cash Flows
Notes to Condensed Consolidated Financial Statements
Appendices
Corporate Information
Corporate Structure of the Group
Financial Highlights
Location Map of Expressways in Zhejiang Province

2013 Interim Results

The directors (the "Directors") of Zhejiang Expressway Co., Ltd. (the "Company") announce the unaudited
consolidated operating results of the Company and its subsidiaries (collectively the "Group") for the six months
ended June 30, 2013 (the "Period"), with the basis of preparation as stated in note 1 to the condensed
consolidated financial statements set out below.
During the Period, revenue for the Group was Rmb3,647.27 million, representing an increase of 6.1% over the same
period in 2012. Profit for the Period attributable to owners of the Company was Rmb930.39 million, representing
an increase of 6.9% year-on-year. Earnings per share for the Period was Rmb21.42 cents (same period in 2012
(restated): Rmb20.03 cents).
The Directors have recommended to pay an interim dividend of Rmb6 cents per share, subject to shareholder approval
at the extraordinary general meeting of the Company expected to be held on October 17, 2013.
The interim report has not been audited or reviewed by the auditors but has been reviewed by the audit committee
of the Company.

Business Review

The rate of growth in the Chinese economy has slowed down in 2013 as a result of the slow recovery of the global
economy and the domestic policy to maintain steady growth and undergo structural adjustment. In the first half of
the year, China's GDP grew 7.6% year-on-year, while economic growth was down 0.1 percentage point from the first
quarter of 2013. Zhejiang Province, which saw its economy begin to stabilize and pick up in the second half of
2012, continued to grow steadily in the first half of the year. The province's GDP grew 8.3% year- on-year during
the Period, an increase the same as that of the first quarter of the year.
Benefiting from steady growth in the economy of Zhejiang Province as well as the recovery in foreign trade in the
province, the Group's income increased by 6.3% comparing with the same period last year, amounting to a total of
Rmb3,759.66 million. Of this income, Rmb1,987.14 million was generated from the three major expressways owned and
operated by the Group, representing an increase of 4.2% when compared with the same period in 2012 and accounting
for 52.9% of total income. Rmb1,016.65 million was generated from the Group's toll road- related businesses,
representing a slight decline of 2.0% when compared with the same period in 2012 and accounting for 27.0% of total
income. The securities business contributed an income of Rmb755.88 million to the Group, representing an increase
of 27.4% when compared with the same period in 2012 and accounting for 20.1% of total income.
A breakdown of the Group's income for the Period is set out below:

                                                  For the six months ended June 30,
                                                           2013               2012
                                                        Rmb'000            Rmb'000        % Change
                                                     (Unaudited)    (Unaudited and
                                                                          restated)
---------------------------------------------------------------------------------------------------
Toll income
  Shanghai-Hangzhou-Ningbo Expressway                 1,502,446          1,456,618            3.1%
  Shangsan Expressway                                   359,199            338,830            6.0%
  Jinhua section, Ningbo-Jinhua Expressway              125,490            112,198           11.8%
Other income
  Service areas (mainly sales of goods)                 962,830            987,188           -2.5%
  Advertising                                            53,815             49,796            8.1%
Securities business income
  Commission                                            579,077            450,200           28.6%
  Bank interest                                         176,800            143,301           23.4%
---------------------------------------------------------------------------------------------------
Subtotal                                              3,759,657          3,538,131            6.3%
Less: Revenue taxes                                    (112,389)           (98,935)          13.6%
---------------------------------------------------------------------------------------------------
Revenue                                               3,647,268          3,439,196            6.1%
---------------------------------------------------------------------------------------------------

Toll Road Operations

A higher level of organic growth was maintained in the traffic volume of the Group's Shanghai-Hangzhou-Ningbo
Expressway and Shangsan Expressway during the Period as a result of apparent signs of stable growth in Zhejiang's
economy in the first half of the year. Although the organic growth in the traffic volume in the second quarter was
lower compared to the first quarter, it remained higher than in the fourth quarter last year.
The impact of the toll free policy on small passenger vehicles for the long holidays of Chinese New Year, Qingming
Festival and Labour Day during the Period led to a loss of approximately Rmb73 million in the Group's toll income.
Coupled with the impact of a number of negative factors such as the phasing out of the "Unified Toll Card" policy
early last year, the adjustment to the rounding off of the last figures for passenger vehicle tolls in mid-May and
the launch of the policy to adjust the classification of passenger vehicles in early August in the same year, the
Group's toll income suffered a loss of approximately Rmb169 million during the Period.
Meanwhile, following the implementation of the tolling policy based on actual travel routes in Zhejiang Province
on May 15, 2012, the Company has managed to increase its toll income by approximately Rmb69 million through the
implementation of a number of initiatives such as the marketing campaign on the tolling policy based on actual
travel routes, the fine-tuning of the toll-by-weight mechanism and the modification of weighing equipment. In
particular, the tolling policy based on actual travel routes had a larger positive impact on Shangsan Expressway,
and accordingly, the increase in toll income from Shangsan Expressway was higher than that from
Shanghai-Hangzhou-Ningbo Expressway during the Period.
Near the end of the Period, the Group completed the acquisition of a 76.55% equity interest in Zhejiang Jinhua
Yongjin Expressway Co., Ltd. ("Jinhua Co", which owns and operates the 69.7km Jinhua Section of the Ningbo-Jinhua
Expressway). During the Period, construction work on some bridges on S211 Provincial Road, which runs parallel to
the Ningbo-Jinhua Expressway, led to an increase in the number of vehicles rerouted to some parts of the Jinhua
Section of the Ningbo-Jinhua Expressway, while the continued traffic congestion on the roads in some areas of
Yiwu prompted a large number of local short-distance vehicles to switch to the nearby Jinhua Section of the
Ningbo-Jinhua Expressway. Moreover, benefiting from the rapid growth in import and export trade in Jinhua, the
traffic volume of large trucks and container trucks increased significantly on a year-on-year basis during the
Period.
Average daily traffic volume in full-trip equivalents along the Group's Shanghai-Hangzhou-Ningbo Expressway was
43,273 during the Period, representing an increase of 3.4% year-on-year. In particular, average daily traffic
volume in full-trip equivalents along the Shanghai-Hangzhou Section of the Shanghai-Hangzhou-Ningbo Expressway
was 43,636, representing an increase of 2.4% year-on-year, and that along the Hangzhou-Ningbo Section was 43,005,
representing an increase of 4.2% year-on-year. Average daily traffic volume in full-trip equivalents along the
Shangsan Expressway was 17,397 during the Period, representing an increase of 2.3% year-on-year. Average daily
traffic volume in full-trip equivalents along the Jinhua Section of the Ningbo-Jinhua Expressway was 12,993
during the Period, representing an increase of 10.4% year-on-year.
Total toll income from the 248km Shanghai-Hangzhou-Ningbo Expressway, the 142km Shangsan Expressway and the 70km
Jinhua Section of the Ningbo-Jinhua Expressway amounted to Rmb1,987.14 million during the Period, representing an
increase of 4.2% year-on-year. Toll income from the Shanghai-Hangzhou-Ningbo Expressway amounted to Rmb1,502.45
million, representing an increase of 3.1% year-on-year; toll income from the Shangsan Expressway amounted to
Rmb359.20 million, representing an increase of 6.0% year-on-year; while toll income from the Jinhua Section of
the Ningbo-Jinhua Expressway amounted to Rmb125.49 million, representing an increase of 11.8% year-on-year.

Toll Road-Related Business Operations

The Company operates certain toll road-related businesses along its expressways through its subsidiaries and
associated companies, including gas stations, restaurants and shops in service areas, as well as a roadside
advertising business.
During the Period, there was a decline in operating income due to the closure of the Yuyao Service Area from June
last year for an expansion project, which commenced service only in March this year, and for which the gas station
resumed full operations only from May 30 this year. This also had an impact on sales of refined oil products in
the service area, resulting in a year-on-year decline in overall income. During the Period, income from toll
road-related operations amounted to Rmb1,016.65 million, representing a decrease of 2.0% year-on-year.

Securities Business

During the Period, the aggregate trading volume of the Shanghai and Shenzhen stock exchanges rose by 22.8%
year-on-year as a result of the recovery in the Chinese stock market. Despite the year-on-year decline in the
market share of Zheshang Securities Co., Ltd. ("Zheshang Securities", a 70.83% owned subsidiary of Zhejiang
Shangsan Expressway Co., Ltd. ("Shangsan Co", a subsidiary of the Company)), a sizable year-on-year increase was
registered in commission income during the Period. Benefitting from an increase in trading volume in the stock
market and a slight rebound in the commission rate, there were year-on-year increases in income to varying
degrees across Zheshang Securities' securities brokerage business, investment banking and asset management
businesses during the Period.
To cope with uncertainties during the current recovery in the stock market, Zheshang Securities is taking measures
to gradually adjust its current business pattern dominated by the brokerage business, and vigorously improving
its income and profit structures to boost the comprehensive development of its various businesses by stepping up
the innovation of its businesses. Meanwhile, in order to speed up the process of its listing on the Shanghai
Stock Exchange, Zheshang Securities has submitted an IPO application which was accepted by the China Securities
Regulatory Commission on May 2, 2013 and is officially admitted into the waiting list for IPOs.
During the Period, Zheshang Securities realized income of Rmb755.88 million, an increase of 27.4% year-on- year.
Of this income, brokerage commission income amounted to Rmb579.08 million, a year-on-year increase of 28.6%, and
interest income from the securities business amounted to Rmb176.80 million, a year-on-year increase of 23.4%.
Moreover, securities investment gains from Zheshang Securities accounted for in the condensed consolidated
statement of profit or loss and other comprehensive income amounted to Rmb73.49 million during the Period.

Long-Term Investments

Zhejiang Expressway Petroleum Development Co., Ltd. (a 50% owned associate company of the Company) benefited from
a growth in the sales of refined oil products during the Period, the associate company realized an income of
Rmb3,085.49 million, representing an increase of 6.1% year-on-year. During the Period, net profit amounted to
Rmb11.34 million (same period in 2012: net profit of Rmb10.18 million).
JoinHands Technology Co., Ltd. ("JoinHands Technology", a 27.582%-owned associate company of the Company)
generated its income primarily from its property leasing activities, and the associate company did not make any
significant improvements to its operations during the Period. The Company has instituted legal proceedings with
regard to the transfer of the equity interest in the associated company and separately lodged an appeal against
the subsequent judgement thereon. On April 28, 2013, the Hangzhou Intermediate People's Court ruled in favour of
the Company in its final judgement which is to be executed after the court conducts an evaluation of the assets
of the associated company.
Shengxin Expressway Co., Ltd. ("Shengxin Co", a 50% owned joint venture of the Company) operates the 73.4km
Shaoxing section of the Ningbo-Jinhua Expressway. During the Period, the improving provincial economy led the
traffic volume on that section to pick up. The average daily traffic volume in full-trip equivalents along that
section was 12,318 vehicles, representing an increase of 2.26% year-on-year and generating a toll income of
Rmb141.22 million. Due to its heavy financial burden, a loss of Rmb27.88 million was recorded in the current
Period.
On March 30, 2013, the Company entered into a capital increase agreement with Zhejiang Communications Investment
Group Finance Co., Ltd. ("Zhejiang Communications Finance") and its existing shareholders, pursuant to which the
Company has conditionally agreed to make a capital contribution of Rmb280 million in cash to the equity capital
of Zhejiang Communications Finance, thereby enabling the Company to own a 35% equity interest in Zhejiang
Communications Finance. Earnings from the associated company were accounted for as share of gain of associates of
the Company from May 1, 2013, and Zhejiang Communications Finance realised profit of Rmb26.05 million from May 1,
2013 to the end of the Period.

Human Resources

During the Period, the Company actively revamped its human resource management, improved its remuneration and
performance policy, and promoted the pegging of overall remuneration increase with the productivity of employees,
thereby paving the way for increasing employees' remuneration. There was no significant change in other staff
matters and assignment compared with the details disclosed in the Company's most recent annual report.

Financial Analysis

The Group adopts a prudent financial policy with an aim to provide shareholders of the Company with sound returns
over the long term.
During the Period, profit attributable to owners of the Company was approximately Rmb930.39 million, representing
an increase of 6.9% year-on-year, return on owners' equity was 6.1%, representing an increase of 8.9%
year-on-year, while earnings per share for the Company was Rmb21.42 cents.

Liquidity and financial resources

As at June 30, 2013, current assets of the Group amounted to Rmb16,364.59 million in aggregate (December 31, 2012
(restated): Rmb15,707.99 million), of which bank balances and cash accounted for 22.3% (December 31, 2012
(restated): 31.0%), bank balances held on behalf of customers accounted for 47.4% (December 31, 2012 (restated):
47.7%), and held for trading investments accounted for 5.7% (December 31, 2012 (restated): 9.5%). Current ratio
(current assets over current liabilities) of the Group as at June 30, 2013 was 1.3 (December 31, 2012 (restated):
1.4). Excluding the effect of the customer deposits arising from the securities business, the resultant current
ratio of the Group (current assets less bank balances held on behalf of customers over current liabilities less
balance of accounts payable to customers arising from securities business) was 1.9 (December 31, 2012 (restated):
2.4).

                                                                                     As at               As at
                                                                                   June 30,        December 31,
                                                                                      2013                2012
                                                                                   Rmb'000             Rmb'000
                                                                                                     (Restated)
----------------------------------------------------------------------------------------------------------------
Cash and cash equivalents
  Rmb                                                                            2,738,150           3,382,797
  US$ in Rmb equivalent                                                             28,879               4,024
  HK$ in Rmb equivalent                                                              5,808               5,232
Time deposits
  Rmb                                                                              869,433           1,459,433
  US$ in Rmb equivalent                                                                 --              23,975
Held for trading investments -- Rmb                                                929,104           1,486,772
Available-for-sale investments -- Rmb                                              200,567             134,899
Total
  Rmb                                                                            4,737,254           6,463,901
  US$ in Rmb equivalent                                                             28,879              27,999
  HK$ in Rmb equivalent                                                              5,808               5,232
----------------------------------------------------------------------------------------------------------------

The amount of held for trading investments of the Group as at June 30, 2013 was Rmb929.10 million (December 31,
2012: Rmb1,486.77 million), of which 97.1% was invested in bonds, 2.4% was invested in stocks, and the rest was
invested in open-end equity funds.
During the Period, net cash inflow generated from the Group's operating activities amounted to Rmb1,050.33
million.
The Directors do not expect the Company to experience any problems with liquidity and financial resources in the
foreseeable future.

Borrowings and solvency

As at June 30, 2013, total liabilities of the Group amounted to Rmb12,948.91 million (December 31, 2012
(restated): Rmb11,863.63 million), of which 10.8% was loans and 59.3% was accounts payable to customers arising
from securities business.
Total interest-bearing borrowings of the Group as at June 30, 2013 amounted to Rmb1,400.00 million, representing
a decrease of 40.2% compared to that as at December 31, 2012. The borrowings comprised outstanding balances of
domestic commercial bank loans of Rmb970.00 million, loans from a domestic non- bank financial institution of
Rmb90.00 million and entrusted loans from an enterprise of Rmb340.00 million. Of the interest-bearing borrowings,
35.7% was not payable within one year. The details of the relevant outstanding amounts are as follows:

                                                              Maturity Profiles
                                                                              >1 year -- 5 years        Beyond
                                                Gross Amount   Within 1 year           inclusive       5 years
                                                     Rmb'000         Rmb'000             Rmb'000       Rmb'000
----------------------------------------------------------------------------------------------------------------
Floating rates
  Domestic commercial bank loans                     970,000         470,000             500,000            --
  Domestic other loans                               340,000         340,000                  --            --
Fix rates                                                 --              --
  Domestic other loans                                90,000          90,000                  --            --
----------------------------------------------------------------------------------------------------------------
Total as at June 30, 2013                          1,400,000         900,000             500,000            --
----------------------------------------------------------------------------------------------------------------
Total as at December 31, 2012 (Restated)           2,340,000       1,660,000             680,000            --
----------------------------------------------------------------------------------------------------------------

As at June 30, 2013, the Group's loans from domestic commercial banks include short-term loans and medium-term
loans, with floating interest rate ranging from 5.895% to 6.12% per annum; loans from an enterprise were
short-term loans, with floating interest rate of 5.24% per annum; loans from a domestic non-bank financial
institution were short-term loans, with the interest rate fixed at 5.40% per annum; while the annual interest
rate for accounts payable to customers arising from the securities business was fixed at 0.35%.
Total interest expenses for the Period amounted to Rmb43.08 million, while profit before interest and tax
amounted to Rmb1,480.42 million. The interest cover ratio (profit before interest and tax over interest expenses)
stood at 34.4 times (corresponding period of 2012 (restated): 18.3).
As at June 30, 2013, the asset-liability ratio (total liabilities over total assets) was 40.8% (December 31, 2012
(restated): 37.7%). Excluding the effect of customer deposits arising from the securities business, the resultant
asset-liability ratio (total liabilities less balance of accounts payable to customers arising from securities
business over total assets less bank balances held on behalf of customers) of the Group was 22.0% (December 31,
2012 (restated): 18.3%).

Capital structure

As at June 30, 2013, the Group had Rmb18,775.83 million in total equity, Rmb8,398.38 million in fixed-rate
liabilities, Rmb1,310.00 million in floating-rate liabilities, Rmb3,240.53 million in interest-free liabilities,
representing 59.2%, 26.5%, 4.1% and 10.2% of the Group's total capital, respectively. The gearing ratio, which is
computed by dividing the total liabilities less accounts payable to customers arising from securities business by
total equity, was 28.0% as at June 30, 2013 (December 31, 2012 (restated): 22.3%).

Capital expenditure commitments and utilization

During the Period, capital expenditure of the Group totaled Rmb1,140.03 million, while capital expenditure of the
Company totaled Rmb1,059.01 million. Amongst the total expenditure of the Group, Rmb756.86 million was incurred
for acquiring 76.55% equity interest in Jinhua Co, Rmb280.00 million was incurred for 35% equity investment in
Zhejiang Communications Finance, Rmb61.12 million was incurred for acquisition and construction of properties,
Rmb19.98 million was incurred for purchase of equipments and Rmb22.07 million was incurred for service area
renovation and expansion.
As at June 30, 2013, the remaining capital expenditure committed by the Group and the Company totaled Rmb1,703.24
million and Rmb1,155.72 million, respectively. Amongst the remaining balance of capital expenditure committed by
the Group, Rmb1,000.00 million will be used for capital injection to Jinhua Co, Rmb435.93 million will be used for
acquisition and construction of properties, Rmb218.53 million for acquisition and construction of equipments and
facilities and Rmb48.78 million for service area renovation and expansion
The Group will finance the above-mentioned capital expenditure commitments with internally generated cash flow
first and then will consider using debt financing to meet any shortfalls in priority to using other methods.

Contingent liabilities and pledge of assets

As at June 30, 2013, Zhejiang Yuhang Expressway Co., Ltd. (a 51% owned subsidiary of the Company) provided a
property under construction as a mortgaged asset for its domestic commercial bank loan of Rmb100.00 million. The
carrying amount of the mortgaged asset was Rmb306.51 million. Besides, Jinhua Co provided the operating right of
its expressway as pledged asset for its domestic commercial bank loans of Rmb870.00 million. The carrying amount
of the pledged asset was Rmb1,933.30 million.
Except for the above, as at June 30, 2013, the Group did not have any other contingent liabilities, pledge of
assets or guarantees.

Foreign exchange exposure

Save for dividend payments to the holders of H shares in Hong Kong dollars, the Group's principal operations were
transacted and booked in Renminbi. Therefore, the Group's exposure to exchange fluctuation is limited. During the
Period, the Group has not used any financial instruments for hedging purpose.
Although the Directors do not foresee any material foreign exchange risks for the Group, there is no assurance
that foreign exchange risks will not affect the operating results of the Group in the future.
Outlook

The overall performance of the Group's toll road operations is influenced by the macroeconomic and regional
economic development. Existing statistical figures suggest that although the economy of Zhejiang Province is
maintaining steady growth, it is subject to downward pressure and the growth rate is likely to decline in the
second half of the year. As a result, organic growth in the traffic volume of the Group's expressways is expected
to slow down in the second half.
Meanwhile, the Jiaxing-Shaoxing Expressway, which opened to traffic on July 19, 2013, is expected to have a slight
diversion impact on the Group's Shanghai-Hangzhou-Ningbo Expressway. Since the Jiaxing-Shaoxing Expressway is
currently not yet open to trucks, the positive, favourable effect has not yet been fully reflected on the Group's
Shangsan Expressway. The opening of the Jiaxing-Shaoxing Expressway will cause a slight fall in the Group's
overall toll income for the whole year.
The Company's management is undertaking various measures to further increase income from its principal business.
By increasing income and plugging loopholes, the Company aims to step up marketing initiatives for newly opened
expressways such as Jiaxing-Shaoxing Expressway to attract more vehicles to use sections of expressways operated
by the Group. Meanwhile, the Group will cut the loss of toll income by taking special measures against a small
number of toll-evading trucks.
Moreover, both the uncertainty over the recovery of the Chinese stock market and the need for China to make
appropriate modifications to its monetary policy have presented new challenges and opportunities for Zheshang
Securities, prompting Zheshang Securities to accelerate the development of innovative businesses and to further
push forward the A-share listing process whilst strengthening cost control and risk control for facilitating the
sustainable development of its businesses.
In addition to continuing to strengthen its principal toll road operations, the Group is also actively engaging
in the development of toll road-related businesses with the acquisition of the franchise to operate two pairs of
service areas of expressways in Ningbo area in early August this year. In addition to the improvement of the
Group's securities and financial business, the Group's management will also seek to generate strategic synergies
with its parent company by seeking suitable investment projects, nurturing management capabilities in its
diversified businesses and utilizing its financial resources advantage to expand the space for future development
and improving profitability.

Disclosure of Interests and Other Matters

Purchase, Sale and Redemption of the Company's Shares

Neither the Company nor any of its subsidiaries had purchased, sold, redeemed or cancelled any of the Company's
shares during the Period.
Disclosure of Directors', Supervisors' and Chief Executive's Interests and Short Positions in the Shares,
Underlying Shares and Debentures
As at June 30, 2013, none of the Directors, Supervisors and chief executives had registered an interest or short
position in the shares, underlying shares or debentures of the Company or any of its associated corporations that
was required to be recorded pursuant to Section 352 of the Securities and Futures Ordinance (Cap 571 of the Laws
of Hong Kong) (the "SFO"), or as otherwise notified to the Company and the Stock Exchange of Hong Kong Limited
(the "Stock Exchange") pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers.

Other Interests Discloseable under the SFO

As at June 30, 2013, the following shareholders held 5% or more of the issued share capital of the Company
according to the register of interests in shares required to be kept by the Company pursuant to Section 336 of
the SFO:

----------------------------------------------------------------------------------------------------------------
                                                                    Total interests          Percentage of the
                                                                       in number of       issued share capital
                                                                    ordinary shares             of the Company
Substantial shareholders                Capacity                     of the Company           (domestic shares)
----------------------------------------------------------------------------------------------------------------
Zhejiang Communications Investment
 Group Co. Ltd.                         Beneficial owner              2,909,260,000                       100%
----------------------------------------------------------------------------------------------------------------

----------------------------------------------------------------------------------------------------------------
                                                                                                 Percentage of
                                                                    Total interests                 the issued
                                                                       in number of              share capital
                                                                    ordinary shares             of the Company
Substantial shareholders                Capacity                     of the Company                  (H Shares)
----------------------------------------------------------------------------------------------------------------
JP Morgan Chase & Co.                   Beneficial owner,            172,403,570 (L)                    12.02%
                                        investment manager and       101,881,024 (P)                     7.11%
                                        custodian corporation/
                                        approved lending agent
BlackRock, Inc.                         Interest of controlled       130,733,579 (L)                     9.11%
                                        corporations
Deutsche Bank Aktiengesellschaft        Investment manager            86,121,242 (L)                     6.01%
                                                                       5,479,399 (S)                     0.38%
----------------------------------------------------------------------------------------------------------------

The letter "L" denotes a long position. The Letter "S" denotes a short position. The Letter "P" denotes interest
in a lending pool.
Save as disclosed above, as at June 30, 2013, no person had registered an interest or short position in the shares
or underlying shares of the Company that was required to be recorded pursuant to Section 336 of the SFO.

Compliance with the Corporate Governance Code and the Model Code

During the Period, the Company had complied with all code provisions in the Corporate Governance Code and
Corporate Governance Report (the "Code") set out in Appendix 14 to the Listing Rules, and had adopted the
recommended best practices in the Code as and when applicable.
The Company has adopted a code of conduct regarding directors' securities transactions on terms no less exacting
than the required standard set out in the Model Code for Securities Transactions by Directors of Listed Issuers
(the "Model Code") in Appendix 10 to the Listing Rules. The Directors have confirmed their full compliance with
the required standard set out in the Model Code and its code of conduct regarding directors' securities
transactions during the Period.

Responsibility Statement of the Directors in Respect of the Interim Report and Accounts

Each of the Directors of the Company, whose name and function is listed in the section headed "Corporate
Information" of this report, confirms that, to the best of his/her knowledge:

    -  the condensed consolidated financial statements prepared in accordance with Hong Kong Financial Reporting
       Standards issued by the Hong Kong Institute of Certified Public Accountants give a true and fair view of
       the assets, liabilities, financial position and profit of the Group and the undertakings included in the
       consolidation taken as a whole;
    -  the management discussion and analysis included in the interim report includes a fair review of the
       development and performance of the business and the position of the Group and the undertakings included
       in the consolidation taken as a whole during the period, together with a description of the principal
       risks and uncertainties that the Group faces for the remaining six months of the financial year; and
    -  the interim report include a fair review of the material related party transactions that have taken place
       during the Period and any material changes in the related party transactions described in the Company's
       annual report for the year ended 31 December 2012.

The electronic version of this report is published on the website of The Stock Exchange of Hong Kong Limited
(http://www.hkex.com.hk) and on the Company's website (www.zjec.com.cn).

                                                                                        By order of the Board
                                                                                    Zhejiang Expressway Co., Ltd.
                                                                                           ZHAN Xiaozhang
                                                                                              Chairman
Hangzhou, the PRC, August 28, 2013

Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income

                                                                             For the six months ended June 30,
                                                                                      2013               2012
                                                                   Notes           Rmb'000            Rmb'000
                                                                                (Unaudited)    (Unaudited and
                                                                                                     restated)
----------------------------------------------------------------------------------------------------------------
Revenue                                                              4           3,647,268          3,439,196
Operating costs                                                                 (2,283,848)        (2,176,784)
----------------------------------------------------------------------------------------------------------------
Gross profit                                                                     1,363,420          1,262,412
Securities investment gains                                                         79,786             61,211
Other income                                                         5             103,890            123,420
Administrative expenses                                                            (36,126)           (35,994)
Other expenses                                                                     (21,401)           (16,755)
Share of gain (loss) of associates                                                   4,791             (8,201)
Share of loss of a joint venture                                                   (13,938)                --
Finance costs                                                        6             (43,079)           (75,664)
----------------------------------------------------------------------------------------------------------------
Profit before tax                                                    7           1,437,343          1,310,429
Income tax expense                                                   8            (374,175)          (322,128)
----------------------------------------------------------------------------------------------------------------
Profit for the Period                                                            1,063,168            988,301
----------------------------------------------------------------------------------------------------------------
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
 when specific conditions are met:
Available-for-sale financial assets
-- Fair value (loss) gain during the Period                                         (3,681)             5,436
-- Reclassification adjustments for cumulative gain included
   in profit or loss upon disposal                                                  (1,381)                --
Income tax relating to components of other comprehensive income                      1,266             (1,359)
----------------------------------------------------------------------------------------------------------------
Other comprehensive (loss) income for the Period (net of tax)                       (3,796)             4,077
----------------------------------------------------------------------------------------------------------------
Total comprehensive income for the Period                                        1,059,372            992,378
----------------------------------------------------------------------------------------------------------------
Profit for the Period attributable to:
  Owners of the Company                                                            930,385            869,973
  Non-controlling interests                                                        132,783            118,328
----------------------------------------------------------------------------------------------------------------
                                                                                 1,063,168            988,301
----------------------------------------------------------------------------------------------------------------
Total comprehensive income for the Period attributable to:
  Owners of the Company                                                            928,429            872,099
  Non-controlling interests                                                        130,943            120,279
----------------------------------------------------------------------------------------------------------------
                                                                                 1,059,372            992,378
----------------------------------------------------------------------------------------------------------------
Earnings per share -- Basic and diluted                              10        21.42 cents        20.03 cents
----------------------------------------------------------------------------------------------------------------

Condensed Consolidated Statement of Financial Position
                                                                                     As at              As at
                                                                                   June 30,       December 31,
                                                                                      2013               2012
Notes                                                                              Rmb'000            Rmb'000
                                                                                (Unaudited)    (Unaudited and
                                                                                                     restated)
----------------------------------------------------------------------------------------------------------------
NON-CURRENT ASSETS
  Property, plant and equipment                                                  1,638,818          1,634,299
  Prepaid lease payments                                                            69,234             70,321
  Expressway operating rights                                                   12,318,555         12,722,158
  Goodwill                                                                          86,867             86,867
  Other intangible assets                                                          149,602            155,633
  Interests in associates                                                          567,997            280,057
  Interest in a joint venture                                                      356,016            369,954
  Available-for-sale investments                                                   173,065            133,000
  Other receivables                                                  13                 --            325,035
----------------------------------------------------------------------------------------------------------------
                                                                                15,360,154         15,777,324
----------------------------------------------------------------------------------------------------------------
CURRENT ASSETS
  Inventories                                                                       27,927             27,418
  Trade receivables                                                  11             64,166             64,447
  Loans to customers arising from margin financing business          12          2,301,208            724,123
  Other receivables and prepayments                                  13            579,078            621,023
  Prepaid lease payments                                                             2,154              2,154
  Available-for-sale investments                                                   200,567            134,899
  Held for trading investments                                                     929,104          1,486,772
  Financial assets held under resale agreements                      14            864,777            280,066
  Bank balances held on behalf of customers                                      7,753,335          7,491,625
  Bank balances and cash
    -- Time deposits with original maturity over three months                      869,433          1,483,408
    -- Cash and cash equivalents                                                 2,772,837          3,392,053
----------------------------------------------------------------------------------------------------------------
                                                                                16,364,586         15,707,988
----------------------------------------------------------------------------------------------------------------
CURRENT LIABILITIES
  Accounts payable to customers arising from securities business                 7,682,376          7,481,819
  Trade payables                                                     15            420,485            408,612
  Tax liabilities                                                                  211,982            223,592
  Other taxes payable                                                               32,250             54,226
  Other payables and accruals                                        16          1,089,978            991,260
  Dividends payable                                                              1,232,271             94,998
  Other loans                                                                      430,000            200,000
  Financial assets sold under repurchase agreements                  17            316,000                 --
  Placements from non-bank financial institutions                                  310,000                 --
  Long-term bonds due in one-year                                                       --          1,000,000
  Long-term loans due in one-year                                                  470,000            460,000
----------------------------------------------------------------------------------------------------------------
                                                                                12,195,342         10,914,507
----------------------------------------------------------------------------------------------------------------

Condensed Consolidated Statement of Financial Position

                                                                                     As at              As at
                                                                                   June 30,       December 31,
                                                                                      2013               2012
                                                                                   Rmb'000            Rmb'000
                                                                                (Unaudited)    (Unaudited and
                                                                                                     restated)
----------------------------------------------------------------------------------------------------------------
Net current assets                                                               4,169,244          4,793,481
----------------------------------------------------------------------------------------------------------------
Total assets less current liabilities                                           19,529,398         20,570,805
----------------------------------------------------------------------------------------------------------------
Non-current liabilities
  Bank loans                                                                       500,000            680,000
  Deferred tax liabilities                                                         253,568            269,124
----------------------------------------------------------------------------------------------------------------
                                                                                   753,568            949,124
----------------------------------------------------------------------------------------------------------------
                                                                                18,775,830         19,621,681
----------------------------------------------------------------------------------------------------------------
CAPITAL AND RESERVES
  Share capital                                                                  4,343,115          4,343,115
  Reserves                                                                      10,909,422         11,701,345
----------------------------------------------------------------------------------------------------------------
Equity attributable to owners of the Company                                    15,252,537         16,044,460
Non-controlling interests                                                        3,523,293          3,577,221
----------------------------------------------------------------------------------------------------------------
                                                                                18,775,830         19,621,681
----------------------------------------------------------------------------------------------------------------

Condensed Consolidated Statement of Changes in Equity

                                                Attributable to owners of the Company
                                                                Investment
                       Share      Share  Statutory   Capital  revaluation    Special   Dividend   Retained
                     capital    premium   reserves   reserve      reserve    reserve    reserve    profits       Total
                     Rmb'000    Rmb'000    Rmb'000   Rmb'000      Rmb'000    Rmb'000    Rmb'000    Rmb'000     Rmb'000
-----------------------------------------------------------------------------------------------------------------------
At January 1, 2012
 (Audited and
 originally
 stated)           4,343,115  3,645,726  2,968,634     1,712       (1,555)    18,666  1,085,779  3,116,462  15,178,539
Merger accounting
 restatement
 (Note 2)                 --         --         --        --           --    797,471         --   (236,477)    560,994
-----------------------------------------------------------------------------------------------------------------------
At January 1, 2012
  (Unaudited and
  restated)        4,343,115  3,645,726  2,968,634     1,712       (1,555)   816,137  1,085,779  2,879,985  15,739,533
Profit for the
 Period                   --         --         --        --           --         --         --    869,973     869,973
Other
 comprehensive
 income for the
 Period                   --         --         --        --        2,126         --         --         --       2,126
-----------------------------------------------------------------------------------------------------------------------
Total
 comprehensive
 income for the
 Period                   --         --         --        --        2,126         --         --    869,973     872,099
Dividend paid
 to
 non-controlling
 interests                --         --         --        --           --         --         --         --          --
Final dividend            --         --         --        --           --         -- (1,085,779)        --  (1,085,779)
Proposed interim
 dividend                 --         --         --        --           --         --    260,587   (260,587)         --
-----------------------------------------------------------------------------------------------------------------------
At June 30, 2012
 (Unaudited)       4,343,115  3,645,726  2,968,634     1,712          571    816,137    260,587  3,489,371  15,525,853
-----------------------------------------------------------------------------------------------------------------------

                        Non-controlling
                              interests      Total
                               Rmb'000     Rmb'000
----------------------------------------------------
At January 1, 2012
 (Audited and
 originally
 stated)                     3,420,561  18,599,100
Merger accounting
 restatement
 (Note 2)                       86,874     647,868
----------------------------------------------------
At January 1, 2012
  (Unaudited and
  restated)                  3,507,435  19,246,968
Profit for the
 Period                        118,328     988,301
Other
 comprehensive
 income for the
 Period                          1,951       4,077
----------------------------------------------------
Total
 comprehensive
 income for the
 Period                        120,279     992,378
Dividend paid
 to
 non-controlling
 interests                    (106,008)   (106,008)
Final dividend                      --  (1,085,779)
Proposed interim
 dividend                           --          --
----------------------------------------------------
At June 30, 2012
 (Unaudited)                 3,521,706  19,047,559
----------------------------------------------------

                                                Attributable to owners of the Company
                                                                Investment
                       Share      Share  Statutory   Capital  revaluation    Special   Dividend   Retained
                     capital    premium   reserves   reserve      reserve    reserve    reserve    profits       Total
                     Rmb'000    Rmb'000    Rmb'000   Rmb'000      Rmb'000    Rmb'000    Rmb'000    Rmb'000     Rmb'000
-----------------------------------------------------------------------------------------------------------------------
At January 1, 2013
 (Audited and
 originally
 stated)          4,343,115   3,645,726  3,227,511     1,712          254     18,666  1,042,347  3,240,921  15,520,252
Merger accounting
 restatement
 (Note 2)                --          --         --        --           --    797,471         --   (273,263)    524,208
-----------------------------------------------------------------------------------------------------------------------
At January 1, 2013
 (Unaudited and
 restated)        4,343,115   3,645,726  3,227,511     1,712          254    816,137  1,042,347  2,967,658  16,044,460
Profit for the
 Period                  --          --         --        --           --         --         --    930,385     930,385
Other
 comprehensive
 income for the
 Period                  --          --         --        --       (1,956)        --         --         --      (1,956)
-----------------------------------------------------------------------------------------------------------------------
Total
 comprehensive
 income for the
 Period                  --          --         --        --       (1,956)        --         --    930,385     928,429
Consideration
 paid for
 acquisition
 of a subsidiary
 under common
 control                 --          --         --        --           --   (678,005)        --         --    (678,005)
Dividend paid to
 non-controlling
 interest                --          --         --        --           --         --         --         --          --
Final dividend           --          --         --        --           --         -- (1,042,347)        --  (1,042,347)
Proposed interim
 dividend                --          --         --        --           --         --    260,587   (260,587)         --
-----------------------------------------------------------------------------------------------------------------------
At June 30, 2013
 (Unaudited)      4,343,115   3,645,726  3,227,511     1,712       (1,702)   138,132    260,587  3,637,456  15,252,537
-----------------------------------------------------------------------------------------------------------------------

                        Non-controlling
                              interests      Total
                               Rmb'000     Rmb'000
----------------------------------------------------
At January 1, 2013
 (Audited and
 originally
 stated)                     3,496,023  19,016,275
Merger accounting
 restatement
 (Note 2)                       81,198     605,406
----------------------------------------------------
At January 1, 2013
 (Unaudited and
 restated)                   3,577,221  19,621,681
Profit for the
 Period                        132,783   1,063,168
Other
 comprehensive
 income for the
 Period                         (1,840)     (3,796)
----------------------------------------------------
Total
 comprehensive
 income for the
 Period                        130,943   1,059,372
Consideration
 paid for
 acquisition
 of a subsidiary
 under common
 control                       (78,863)   (756,868)
Dividend paid to
 non-controlling
 interest                     (106,008)   (106,008)
Final dividend                      --  (1,042,347)
Proposed interim
 dividend                           --          --
----------------------------------------------------
At June 30, 2013
 (Unaudited)                 3,523,293  18,775,830
----------------------------------------------------

Condensed Consolidated Statement of Cash Flows

                                                                             For the six months ended June 30,
                                                                                       2013               2012
                                                                                    Rmb'000            Rmb'000
                                                                                 (Unaudited)    (Unaudited and
                                                                                                      restated)
----------------------------------------------------------------------------------------------------------------
Net cash from operating activities                                                1,050,327            601,880
Net cash (used in) from investing activities                                       (709,921)           140,521
Net cash used in financing activities                                              (959,622)          (490,168)
----------------------------------------------------------------------------------------------------------------
Net (decrease) increase in cash and cash equivalents                               (619,216)           252,233
Cash and cash equivalents at beginning of the Period                              3,392,053          3,139,820
----------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of the Period                                    2,772,837          3,392,053
----------------------------------------------------------------------------------------------------------------

Notes to Condensed Consolidated Financial Statements

1.   Basis of Preparation
     The condensed consolidated financial statements have been prepared in accordance with the applicable disclosure
     requirements set out in Appendix 16 to the Rules Governing the Listing of Securities on The Stock Exchange of
     Hong Kong Limited (the "Listing Rules") and with Hong Kong Accounting Standard 34 ("HKAS 34") "Interim Financial
     Reporting".
2.   Merger Accounting Restatement
     During the Period, the Group has acquired the remaining 76.55% equity interest in Zhejiang Jinhua Yongjin
     Expressway Co., Ltd. ("Jinhua Co"), of which 66.283% equity interest was acquired from Zhejiang Communications
     Investment Group Co., Ltd ("Communications Group"). Since Communications Group is the parent company of the
     Company, this transaction was regarded as business combination involving entities under common control and was
     accounted for using merger accounting method, in accordance with the guidance set out in Accounting Guideline 5
     "Merger Accounting for Common Control Combinations" issued by the Hong Kong Institute of Certified Public
     Accountants (the "HKICPA"). As a result, the comparative condensed consolidated statement of profit or loss and
     other comprehensive income and condensed consolidated statement of cash flows for the period ended June 30, 2012
     and the consolidated statement of financial position as at December 31, 2012 have therefore been restated, in
     order to include the losses, assets and liabilities of the combining entities since the date on which they first
     come under common control.
     The adopting of merger accounting method has resulted in a decrease in total comprehensive income attributable to
     owners of the Company and a decrease in profit attributable to owners of the Company for the period ended June 30,
     2012 by Rmb21,618,000 and Rmb21,618,000, respectively.
     The effect of the merger accounting restatement described above on the condensed consolidated statement of profit
     or loss and other comprehensive income for the six months ended June 30, 2012 by line items is as follows:

                                                                           For the                            For the
                                                                        six months          Merger         six months
                                                                     ended June 30,     accounting      ended June 30,
                                                                              2012     restatement               2012
                                                                           Rmb'000         Rmb'000            Rmb'000
                                                                    (Unaudited and                         (Unaudited
                                                                 originally stated)                      and restated)
     ------------------------------------------------------------------------------------------------------------------
      Revenue                                                            3,329,181         110,015          3,439,196
      Operating costs                                                   (2,076,791)        (99,993)        (2,176,784)
     ------------------------------------------------------------------------------------------------------------------
      Gross profit                                                       1,252,390          10,022          1,262,412
      Securities investment gains                                           61,211              --             61,211
      Other income                                                         124,881          (1,461)           123,420
      Administrative expenses                                              (33,410)         (2,584)           (35,994)
      Other expenses                                                       (16,508)           (247)           (16,755)
      Share of loss of associates                                          (15,849)          7,648             (8,201)
      Finance costs                                                        (31,223)        (44,441)           (75,664)
     ------------------------------------------------------------------------------------------------------------------
      Profit before tax                                                  1,341,492         (31,063)         1,310,429
      Income tax expense                                                  (328,225)          6,097           (322,128)
     ------------------------------------------------------------------------------------------------------------------
      Profit for the Period                                              1,013,267         (24,966)           988,301
     ------------------------------------------------------------------------------------------------------------------
      Other comprehensive income
      Items that may be reclassified subsequently to
       profit or loss when specific conditions are met:
      Available-for-sale financial assets
        -- Fair value gain during the Period                                 5,436              --              5,436
      Income tax relating to components of other
       comprehensive income                                                 (1,359)             --             (1,359)
     ------------------------------------------------------------------------------------------------------------------
      Other comprehensive income for the Period (net of tax)                 4,077              --              4,077
     ------------------------------------------------------------------------------------------------------------------
      Total comprehensive income for the Period                          1,017,344         (24,966)           992,378
     ------------------------------------------------------------------------------------------------------------------
      Profit for the Period attributable to:
        Owners of the Company                                              891,591         (21,618)           869,973
        Non-controlling interests                                          121,676          (3,348)           118,328
     ------------------------------------------------------------------------------------------------------------------
                                                                         1,013,267         (24,966)           988,301
     ------------------------------------------------------------------------------------------------------------------
      Total comprehensive income attributable to:
        Owners of the Company                                              893,717         (21,618)           872,099
        Non-controlling interests                                          123,627          (3,348)           120,279
     ------------------------------------------------------------------------------------------------------------------
                                                                         1,017,344         (24,966)           922,378
     ------------------------------------------------------------------------------------------------------------------
      Earnings per share -- Basic and diluted                          20.53 cents     (0.50) cents       20.03 cents
     ------------------------------------------------------------------------------------------------------------------

     The effect of the merger accounting restatement described above on the consolidated statement of financial
     position as at December 31, 2012 by line items is as follows:

                                                                      As at           Merger                As at
                                                                December 31,      accounting          December 31,
                                                                       2012      restatement                 2012
                                                                    Rmb'000          Rmb'000              Rmb'000
                                                               (Audited and                        (Unaudited and
                                                          originally stated)                             restated)
     ---------------------------------------------------------------------------------------------------------------
      NON-CURRENT ASSETS
        Property, plant and equipment                             1,357,844          276,455            1,634,299
        Prepaid lease payments                                       66,931            3,390               70,321
        Expressway operating rights                              10,732,058        1,990,100           12,722,158
        Goodwill                                                     86,867               --               86,867
        Other intangible assets                                     155,633               --              155,633
        Interests in associates                                     465,513         (185,456)             280,057
        Interest in a joint venture                                 369,954               --              369,954
        Available-for-sale investments                              133,000               --              133,000
        Other receivables                                           325,035               --              325,035
     ---------------------------------------------------------------------------------------------------------------
                                                                 13,692,835        2,084,489           15,777,324
     ---------------------------------------------------------------------------------------------------------------
      CURRENT ASSETS
        Inventories                                                  27,418               --               27,418
        Trade receivables                                            57,847            6,600               64,447
        Loans to customers arising from margin
         financing business                                         724,123               --              724,123
        Other receivables and prepayments                           701,627          (80,604)             621,023
        Prepaid lease payments                                        2,052              102                2,154
        Available-for-sale investments                              134,899               --              134,899
        Held for trading investments                              1,486,772               --            1,486,772
        Financial assets held under resale agreement                280,066               --              280,066
        Bank balances held on behalf of customers Bank
         balances and cash                                        7,491,625               --            7,491,625
           -- Time deposits with originally maturity over
              three months                                        1,483,408               --            1,483,408
           -- Cash and cash equivalents                           3,362,709           29,344            3,392,053
     ---------------------------------------------------------------------------------------------------------------
                                                                 15,752,546          (44,558)          15,707,988
     ---------------------------------------------------------------------------------------------------------------
      CURRENT LIABILITIES
        Accounts payable to customers arising from
         securities business                                      7,481,819               --            7,481,819
        Trade payables                                              378,364           30,248              408,612
        Tax liabilities                                             223,592               --              223,592
        Other taxes payable                                          53,082            1,144               54,226
        Other payables and accruals                                 973,031           18,229              991,260
        Dividends payable                                            94,998               --               94,998
        Other loans                                                      --          200,000              200,000
        Long-term bonds due in one-year                           1,000,000               --            1,000,000
        Long-term loans due in one-year                                  --          460,000              460,000
     ---------------------------------------------------------------------------------------------------------------
                                                                 10,204,886          709,621           10,914,507
     ---------------------------------------------------------------------------------------------------------------
      NET CURRENT ASSETS                                          5,547,660         (754,179)           4,793,481
     ---------------------------------------------------------------------------------------------------------------
      TOTAL ASSETS LESS CURRENT LIABILITIES                      19,240,495        1,330,310           20,570,805
     ---------------------------------------------------------------------------------------------------------------
      NON-CURRENT LIABILITIES
        Bank loans                                                       --          680,000              680,000
        Deferred tax liabilities                                    224,220           44,904              269,124
     ---------------------------------------------------------------------------------------------------------------
                                                                    224,220          724,904              949,124
     ---------------------------------------------------------------------------------------------------------------
                                                                 19,016,275          605,406           19,621,681
     ---------------------------------------------------------------------------------------------------------------
      CAPITAL AND RESERVES
        Share capital                                             4,343,115               --            4,343,115
        Reserves                                                 11,177,137          524,208           11,701,345
     ---------------------------------------------------------------------------------------------------------------
      Equity attributable to owners of the Company               15,520,252          524,208           16,044,460
      Non-controlling interests                                   3,496,023           81,198            3,577,221
     ---------------------------------------------------------------------------------------------------------------
                                                                 19,016,275          605,406           19,621,681
     ---------------------------------------------------------------------------------------------------------------

     The effect of merger accounting restatement described above on the Group's equity as at January 1, 2013 and
     January 1, 2012 is as follows:

                                           As at        Merger       As at         As at        Merger      As at
                                       January 1,   accounting   January 1,    January 1,   accounting  January 1,
                                            2012   restatement        2012          2013   restatement       2013
                                         Rmb'000       Rmb'000     Rmb'000       Rmb'000       Rmb'000    Rmb'000
                                    (Audited and                (Unaudited  (Audited and                (Unaudited
                                      originally                       and    originally                       and
                                          stated)                 restated)       stated)                 restated)
     ---------------------------------------------------------------------------------------------------------------
      Share capital                    4,343,115            --   4,343,115     4,343,115            --   4,343,115
      Share premium                    3,645,726            --   3,645,726     3,645,726            --   3,645,726
      Statutory reserves               2,968,634            --   2,968,634     3,227,511            --   3,227,511
      Capital reserve                      1,712            --       1,712         1,712            --       1,712
      Investment revaluation reserve      (1,555)           --      (1,555)          254            --         254
      Special reserve                     18,666       797,471     816,137        18,666       797,471     816,137
      Dividend reserve                 1,085,779            --   1,085,779     1,042,347            --   1,042,347
      Retained profits                 3,116,462      (236,477)  2,879,985     3,240,921      (273,263)  2,967,658
     ---------------------------------------------------------------------------------------------------------------
      Equity attributable to owners
       of the Company                 15,178,539       560,994  15,739,533    15,520,252       524,208  16,044,460
      Non-controlling interests        3,420,561        86,874   3,507,435     3,496,023        81,198   3,577,221
     ---------------------------------------------------------------------------------------------------------------
      Total                           18,599,100       647,868  19,246,968    19,016,275       605,406  19,621,681
     ---------------------------------------------------------------------------------------------------------------

3.   Principal Accounting Policy

     The condensed consolidated financial statements have been prepared on the historical cost basis except for certain
     financial instruments that are measured at fair value, as appropriate.
     Except as described below, the accounting policies applied in the condensed consolidated financial statements for
     the Period are consistent with those in the preparation of the Group's annual financial statements for the year
     ended December 31, 2012.

     Merger accounting for business combination involving entities under common control
     The condensed consolidated financial statements incorporate the financial statements items of the combining
     entities or businesses in which the common control combination occurs as if they had been combined from the date
     when the combining entities or businesses first came under the control of the controlling party.
     The net assets of the combining entities or businesses are consolidated using the existing book values from the
     controlling party's perspective. No amount is recognised in respect of goodwill or excess of acquirer's interest
     in the net fair value of acquiree's identifiable assets, liabilities and contingent liabilities over cost at the
     time of common control combination, to the extent of the continuation of the controlling party's interest.
     The condensed consolidated statement of profit or loss and other comprehensive income includes the results of
     each of the combining entities or businesses from the earliest date presented or since the date when the
     combining entities or businesses first came under the common control, where this is a shorter period, regardless
     of the date of the common control combination.
     The comparative amounts in the condensed consolidated financial statements are presented as if the entities or
     businesses had been combined at the end of the previous reporting period or when they first came under common
     control, whichever is shorter.
     During the Period, the Group has applied, for the first time, the following new and revised Hong Kong Financial
     Reporting Standards ("HKFRSs") issued by HKICPA, which are effective for the Period. Except for the following,
     the application of the other new and revised HKFRSs in the current interim period had no material impact on the
     condensed consolidated financial statements and (or) relevant disclosures set out in these condensed consolidated
     financial statements.

     Impact of the application of HKFRS 11
     HKFRS 11 replaces HKAS 31 Interests in Joint Ventures, and the guidance contained in a related interpretation,
     HK(SIC) -- Int 13 Jointly Controlled Entities -- Non-Monetary Contributions by Venturers, has been incorporated
     in HKAS 28 (as revised in 2011). HKFRS 11 deals with how a joint arrangement of which two or more parties have
     joint control should be classified and accounted for. Under HKFRS 11, there are only two types of joint
     arrangements -- joint operations and joint ventures. The classification of joint arrangements under HKFRS 11 is
     determined based on the rights and obligations of parties to the joint arrangements by considering the structure,
     the legal form of the arrangements, the contractual terms agreed by the parties to the arrangement, and, when
     relevant, other facts and circumstances. A joint operation is a joint arrangement whereby the parties that have
     joint control of the arrangement (i.e. joint operators) have rights to the assets, and obligations for the
     liabilities, relating to the arrangement. A joint venture is a joint arrangement whereby the parties that have
     joint control of the arrangement (i.e. joint venturers) have rights to the net assets of the arrangement.
     Previously, HKAS 31 had three types of joint arrangements -- jointly controlled entities, jointly controlled
     operations and jointly controlled assets. The classification of joint arrangements under HKAS 31 was primarily
     determined based on the legal form of the arrangement (i.e. a joint arrangement that was established through a
     separate entity was classified as a jointly controlled entity).
     The initial and subsequent accounting of joint ventures and joint operations are different. Investments in joint
     ventures are accounted for using the equity method (proportionate consolidation is no longer allowed).
     Investments in joint operations are accounted for such that each joint operator recognises its assets (including
     its share of any assets jointly held), its liabilities (including its share of any liabilities incurred jointly),
     its revenue (including its share of revenue from the sale of the output by the joint operation) and its expenses
     (including its share of any expenses incurred jointly). Each joint operator accounts for the assets and
     liabilities, as well as revenues and expenses, relating to its interest in the joint operation in accordance with
     the applicable standards. The directors of the Company reviewed and assessed the classification of the Group's
     investment in joint arrangement in accordance with the requirements of HKFRS 11. The directors concluded that the
     Group's interest in a jointly controlled entity under HKAS 31 should be classified as a joint venture under HKFRS
     11. The application of HKFRS 11 has not had any material impact on the amount recognised in the Group's condensed
     consolidated financial statements.

     Amendments to HKAS 1 Presentation of Items of Other Comprehensive Income
     The amendments to HKAS 1 introduce new terminology for statement of comprehensive income and income statement.
     Under the amendments to HKAS 1, a statement of comprehensive income is renamed as a statement of profit or loss
     and other comprehensive income and an income statement is renamed as a statement of profit or loss. The
     amendments to HKAS 1 retain the option to present profit or loss and other comprehensive income in either a
     single statement or in two separate but consecutive statements. However, the amendments to HKAS 1 require
     additional disclosures to be made in other comprehensive section such that items of other comprehensive income
     are grouped into two categories: (a) items that will not be reclassified subsequently to profit or loss; and
     (b) items that may be reclassified subsequently to profit or loss when specific conditions are met. Income tax on
     items of other comprehensive income is required to be allocated on the same basis -- the amendments do not change
     the existing option to present items of other comprehensive income either before tax or net of tax. The
     amendments have been applied retrospectively, and hence the presentation of items of other comprehensive income
     has been modified to reflect the changes.

     HKFRS 13 Fair value measurement
     The Group has applied HKFRS 13 for the first time in the current interim period. HKFRS 13 establishes a single
     source of guidance for and disclosures about, fair value measurement, and replaces those requirements previously
     included in various HKFRSs. Consequential amendments have been made to HKAS 34 to require certain disclosures to
     be made in the interim condensed consolidated financial statements.
     The scope of the HKFRS 13 is broad, and applies to both financial instrument items and non-financial instrument
     items for which other HKFRSs require or permit fair value measurements and disclosures about fair value
     measurements, subject to a few exceptions. HKFRS 13 contains a new definition of "fair value" and defines fair
     value as the price that would be received to sell an asset or paid to transfer a liability in an orderly
     transaction in principal (or most advantageous) market at the measurement date under current market conditions.
     Fair value under HKFRS 13 is an exit price regardless of whether that price is directly observable or estimated
     using another valuation technique. Also, HKFRS 13 includes extensive disclosure requirements.
     In accordance with the transitional provisions of HKFRS 13, the Group has applied the fair value measurement and
     disclosure requirements prospectively. The Group has provided these disclosures in accordance with the
     consequential amendments of HKAS 34 in note 20. Other than the additional disclosures, the application of HKFRS
     13 has not had any material impact on the amount recognised in the Group's condensed consolidated financial
     statements.

4.   Revenue and Segment Information
     Comparing to the same period last year, there were no changes in the reportable and operating segments of the
     Group during the Period.

     Segment revenue and results
     The following is an analysis of the Group's revenue and results by reportable and operating segments:

                                                                   For the six months ended June 30, 2013
                                                                          Service
                                                                         area and
                                                             Toll     advertising      Securities
                                                        operation      businesses       operation           Total
                                                          Rmb'000         Rmb'000         Rmb'000         Rmb'000
                                                       (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)
     ---------------------------------------------------------------------------------------------------------------
      Segment revenue from external customers           1,921,545       1,010,644         715,079       3,647,268
     ---------------------------------------------------------------------------------------------------------------
      Segment profit                                      868,464          27,839         166,865       1,063,168
     ---------------------------------------------------------------------------------------------------------------

                                                               For the six months ended June 30, 2012
                                                                                          Service
                                                                                         area and
                                                             Toll     advertising      Securities
                                                        operation      businesses       operation             Total
                                                          Rmb'000         Rmb'000         Rmb'000           Rmb'000
                                                       (Unaudited      (Unaudited                        (Unaudited
                                                     and restated)   and restated)     (Unaudited)     and restated)
     ---------------------------------------------------------------------------------------------------------------
      Segment revenue from external customers           1,844,153       1,028,811         566,232         3,439,196
     ---------------------------------------------------------------------------------------------------------------
      Segment profit                                      824,047          23,565         140,689           988,301
     ---------------------------------------------------------------------------------------------------------------

     Segment profit represents the profit after tax of each operating segment. This is the measure reported to the
     chief operating decision maker -- the Company's General Manager, for the purpose of resource allocation and
     performance assessment.

     Revenue from major services
     An analysis of the Group's revenue, net of discounts and taxes, for the Period is as followed:

                                                                                For the six months ended June 30,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Toll operation revenue                                                         1,921,545          1,844,153
      Service area businesses revenue (mainly sales of goods)                          958,740            983,282
      Advertising business rental revenue                                               51,904             45,529
      Commission income from securities operation                                      538,279            422,931
      Interest income from securities operation                                        176,800            143,301
     ---------------------------------------------------------------------------------------------------------------
      Total revenue                                                                  3,647,268          3,439,196
     ---------------------------------------------------------------------------------------------------------------

5.   Other Income

                                                                                For the six months ended June 30,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Interest income on bank balances, entrusted loan receivables
       and financial products investment                                                45,746             72,158
      Rental income                                                                     32,652             34,020
      Handling fee income                                                                2,193              3,396
      Towing income                                                                      4,883              5,557
      Exchange gain (loss), net                                                             14             (3,552)
      Others                                                                            18,402             11,841
     ---------------------------------------------------------------------------------------------------------------
      Total                                                                            103,890            123,420
     ---------------------------------------------------------------------------------------------------------------

6.   Finance Costs

                                                                                For the six months ended June 30,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Interest expenses wholly repayable within 5 years:
        Bank loans                                                                      28,139             48,979
        Long-term bonds                                                                  2,700             21,450
        Other loans                                                                     10,415              5,235
        Others                                                                           1,825                 --
     ---------------------------------------------------------------------------------------------------------------
                                                                                        43,079             75,664
     ---------------------------------------------------------------------------------------------------------------

7.   Profit before Tax

     The Group's profit before tax has been arrived at after charging:

                                                                                For the six months ended June 30,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Depreciation of property, plant and equipment                                     95,632             85,734
      Amortisation of prepaid lease payments                                             1,087              1,077
      Amortisation of expressway operating rights
       (included in operating costs)                                                   403,604            402,005
      Amortisation of other intangible assets                                            8,978              9,324
      Cost of inventories recognised as an expense                                     871,039            908,265
     ---------------------------------------------------------------------------------------------------------------

8.   Income Tax Expense

                                                                                For the six months ended June 30,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Current tax:
        PRC enterprise income tax                                                      388,811            326,801
        Deferred tax                                                                   (14,636)            (4,673)
     ---------------------------------------------------------------------------------------------------------------
                                                                                        374,175           322,128
     ---------------------------------------------------------------------------------------------------------------

     Under the Law of the PRC on Enterprise Income Tax (the "EIT Law") and Implementation Regulation of the EIT Law,
     the tax rate of the Group is 25%.
     No Hong Kong Profits Tax has been provided as the Group's income neither arises in, nor is derived from Hong Kong
     during the Period.

9.   Dividends
     The Directors have recommended the payment of an interim dividend of Rmb6 cents per share (corresponding period
     of 2012: Rmb6 cents per share), subject to shareholders' approval at the extraordinary general meeting of the
     Company expected to be held on October 17, 2013.

10.  Earnings per Share
     The calculation of the basic earnings per share is based on profit for the Period attributable to owners of the
     Company of Rmb930,385,000 (corresponding period of 2012 (restated): Rmb869,973,000) and the 4,343,114,500 (2012:
     4,343,114,500) ordinary shares in issue during the Period.
     Diluted earnings per share presented is the same as basic earnings per share since there was no potential
     ordinary shares outstanding during the both periods.

11.  Trade Receivables
     The Group has no credit period granted to its trade customers of toll operation and service area businesses. The
     following is an aged analysis of trade receivables presented based on the invoice date, which approximated the
     respective revenue recognition dates, at the end of the reporting period:

                                                                                         As at              As at
                                                                                       June 30,       December 31,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Within 3 months                                                                   62,497             64,138
      3 months to 1 year                                                                 1,500                 --
      1 to 2 years                                                                          --                146
      Over 2 years                                                                         169                163
     ---------------------------------------------------------------------------------------------------------------
      Total                                                                             64,166             64,447
     ---------------------------------------------------------------------------------------------------------------

     Included in the Group's trade receivable balance aged within 3 months were toll receivables from the Expressway
     Fee Settlement Center of the Highway Administration Bureau of Zhejiang Province amounting to Rmb59,829,000
     (December 31, 2012: Rmb58,173,000) which has been settled subsequent to the end of the reporting period. The
     directors consider the credit risk of the balance to be minimal.

12.  Loans to Customers Arising from Margin Financing Business
     The Group has provided customers with margin financing and securities lending for securities transactions since
     June 2012, the credit facility limits to margin clients are determined by the discounted market value of the
     collateral securities accepted by the Group.
     All of the loans to margin clients which are secured by the underlying pledged securities are interest bearing
     at a fixed rate of 8.6% (December 31, 2012: 8.6%) per annum. The Group maintains a list of approved stocks for
     margin lending at a specified loan to collateral ratio. Any excess in the lending ratio will trigger a margin
     call which the customers have to make good of the shortfall. The Group has the right to process forced
     liquidation if the customer fails to make good of the shortfall within a short period of time.
     As at June 30, 2013, loans to customers under the margin financing and securities lending activities carried out
     in the PRC were secured by the customers' stock securities and cash collaterals. The undiscounted market value of
     the stock security collaterals amounted to Rmb5,867,036,000 (December 31, 2012: Rmb2,745,885,000). Cash
     collateral of Rmb170,807,000 (December 31, 2012: Rmb75,976,000) received from clients has been included in
     accounts payable to customers arising from securities business.
     No aged analysis is disclosed as in the opinion of the directors, the aged analysis does not give additional
     value in view of the nature of business of securities margining financing.

13.  Other Receivables and Prepayments

                                                                                         As at              As at
                                                                                       June 30,       December 31,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Current:
        Entrusted loans receivables from related parties (Note 18(ii) (a))             393,691            314,616
        Interest receivables                                                            52,319             73,440
        Prepayments                                                                     22,392             31,543
        Financial products investment receivables (Note a)                               2,000            103,432
        Others*                                                                        108,676             97,992
     ---------------------------------------------------------------------------------------------------------------
                                                                                       579,078            621,023
     ---------------------------------------------------------------------------------------------------------------
      Non-current:
        Entrusted loans receivables from related parties (Note 18(ii) (a))                  --            325,035
     ---------------------------------------------------------------------------------------------------------------
                                                                                       579,078            946,058
     ---------------------------------------------------------------------------------------------------------------
     *   The amounts were unsecured, interest-free and repayable on demand.
     Note:
     (a)   Short-term fixed-yield and principal protected bank financial products.

14.  Financial Assets held under Resale Agreement
     As at June 30, 2013, the amount represented equity securities acquired by the Group which would be resold at a
     predetermined price under resale agreements with individual customers in the PRC in 2013. The cash advance by the
     Group carried interest at fixed rates ranging from 7.0% to 8.6% (December 31, 2012: 2.16% to 5.77%) per annum.
     The Group conducted resale agreement under usual and customary terms of placements and held collaterals for these
     transactions.
     As at June 30, 2013, the collaterals are equity securities listed in the PRC, the fair value of equity securities
     as collaterals was Rmb1,277,640,000 (December 31, 2012: Rmb299,918,000). In addition, as at December 31, 2012 the
     collaterals also included debt securities listed in the PRC of which fair value was Rmb119,900,000.

15.  Trade Payables
     Trade payables mainly represent the construction payables for the improvement projects of toll expressways. The
     following is an aged analysis of the trade payables presented based on the invoice date at the end of the
     reporting period:

                                                                                         As at              As at
                                                                                       June 30,       December 31,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Within 3 months                                                                  163,062            236,246
      3 months to 1 year                                                               128,131             37,328
      1 to 2 years                                                                      26,051             29,117
      2 to 3 years                                                                       8,694             49,122
      Over 3 years                                                                      94,547             56,799
     ---------------------------------------------------------------------------------------------------------------
      Total                                                                            420,485            408,612
     ---------------------------------------------------------------------------------------------------------------

16.  Other Payables and Accruals

                                                                                         As at              As at
                                                                                       June 30,       December 31,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Other liabilities:
        Accrued payroll and welfare                                                    444,069            408,689
        Advance from customers                                                          57,743             74,453
        Toll collected on behalf of other toll roads                                     7,890              7,114
        Consideration payable for acquisition of equity interest
         in Shengxin Expressway Co., Ltd.                                              191,155            189,331
      Consideration payable for non-controlling interest for
       acquisition of additional interest in Jinhua Co under common control            101,512                 --
      Retention payable                                                                107,485             85,613
      Others                                                                           176,545            183,720
     ---------------------------------------------------------------------------------------------------------------
                                                                                     1,086,399            948,920
      Other accruals                                                                     3,579             42,340
     ---------------------------------------------------------------------------------------------------------------
      Total                                                                          1,089,978            991,260
     ---------------------------------------------------------------------------------------------------------------

17.  Financial Assets sold under Repurchase Agreements
     Sales and repurchase agreements are transactions in which the Group sells a security and simultaneously agrees to
     repurchase it (or an asset that is substantially the same) at a fixed price on a future date. Since the
     repurchase prices are fixed, the Group are still exposed to substantially all the credit risks and market risks
     and rewards of those securities sold. These securities are not derecognised but regarded as "collateral" for the
     secured lending from these counterparties because the Group retains substantially all the risks and rewards of
     these securities. In addition, the cash received is recognised as financial liability.
     As at 30 June 2013, the Group entered into repurchase agreements with certain counterparties. The proceeds from
     selling such securities are presented as financial assets sold under repurchase agreements. The cash advanced to
     the Group carried interest at fixed rates ranging from 5.5% to 8.085% per annum. Because the Group sells the
     contractual rights to the cash flows of the securities, it does not have the ability to use the transferred
     securities during the term of the arrangement.
     There was no financial assets sold under repurchase agreements for the year ended December 31, 2012.

18.  Related Party Transactions and Balances
     The following is a summary of the related party transactions during the Period occured in the Group's operating activities:
     (i)   Transactions and balances with government related parties
           The Group operates in an economic environment currently predominated by entities directly or indirectly
           owned or controlled by the PRC government ("government-related entities"). In addition, the Group itself is
           part of a larger group of companies under the Communications Group which is controlled by the PRC
           government. However, due to the business nature, in respect of the Group's toll road business, the
           directors are of the opinion that it is impracticable to ascertain the identity of counterparties and
           accordingly whether the transactions are with other government-related entities in the PRC. Details of
           other significant transactions with government related parties are summarised below:
           (a)   Transactions with Communications Group
                 (1)   On March 20, 2013, the Company entered into an agreement with Communications Group pursuant to
                       which the Company conditionally agreed to purchase from Communications Group a 66.283% equity
                       interest in the Jinhua Co held by Communications Group at a cash consideration of
                       Rmb655,356,000. As at the date of this report, the acquisition has been completed.
                 (2)   On March 30, 2013, the Company entered into the capital contribution agreement with Zhejiang
                       Communications Investment Group Finance Co., Ltd. ("Zhejiang Communications Finance") and its
                       existing shareholders (all of who are subsidiaries of Communications Group). Pursuant to the
                       agreement, the Company conditionally agreed to contribute an amount of Rmb280,000,000 in the
                       capital of Zhejiang Communications Finance, by way of cash. Upon completion, the Company owned
                       35% equity interest in Zhejiang Communications Finance. As at the date of this report, the
                       contribution has been completed.
                 (3)   Pursuant to the entrusted loan contracts entered into between Jinhua Co and Communications
                       Group on February 28, 2013, Communications Group agreed to provide Jinhua Co with entrusted
                       loans amounted to Rmb340,000,000 at a floating interest rate of 5.24% per annum, with maturity
                       date of August 10, 2015. Such loans were early repaid in August, 2013.
                 (4)   Pursuant to loan contracts entered into between Jinhua Co and Zhejiang Communications Finance
                       on March 8, 2013 and April 8, 2013, respectively, Zhejiang Communications Finance provided
                       Jinhua Co with loans amounted to Rmb90,000,000 at a fixed interest rate of 5.4% per annum, with
                       maturity date of March 8, 2014 and April 8, 2014. Part of the loans of Rmb30,000,000 was early
                       repaid in August, 2013.
           (b)   Transactions with other government related parties
                 (1)   Pursuant to the operation management agreement entered into between Zhejiang Expressway
                       Investment Development Co., Ltd. ("Development Company"), a wholly owned subsidiary of the
                       Company, and Zhejiang Expressway Petroleum Development Co., Ltd. ("Petroleum Company") in
                       respect of the petrol stations in the service areas along Shanghai-Hangzhou-Ningbo and
                       Shangsan Expressways. Petroleum Company will have its expertise to assist Development Company
                       in running their petrol stations in service areas along Shanghai-Hangzhou-Ningbo and Shangsan
                       Expressways. During the Period, purchase of petroleum products from Petroleum Company totaled
                       Rmb811,976,000 (corresponding period of 2012: Rmb844,686,000).
                       Petroleum Company is a government related party and also an associate of the Group.
                (2)   The Group has entered into various significant transactions, including deposit placements,
                      borrowings and other general banking facilities, with certain banks and financial institutions
                      which are government-related entities in its ordinary course of business. In view of the nature
                      of those banking transactions, the directors are of the opinion that separate disclosure would
                      not be meaningful.

     (ii)  Transactions and balances with associates and other non-government related parties
           (a)   Transactions and balances with associates and its subsidiaries
                 (1)   Pursuant to the board resolutions of the Company as at August 28, 2010 and the entrusted loan
                       contracts, the Company provided short-term entrusted loans during 2011 totalling Rmb390,000,000
                       with maturity date from November 4, 2011 to August 7, 2012 and long- term entrusted loan
                       totalling Rmb100,000,000 with maturity date on May 17, 2013 to Zhejiang Canal Concord Property
                       Co., Ltd. ("Zhejiang Canal Concord "), a subsidiary of Hangzhou Concord Construction and
                       Management Co., Ltd.,("Hangzhou Concord Company", which is also a subsidiary of the Group's
                       associate), at a fixed interest rate of 12% per annum. Such entrusted loans are guaranteed by
                       World Trade Center Zhejiang Real Estate Development Co., Ltd. ("World Trade Ltd"), a related
                       party of Hangzhou Concord Company, in full. Part of the short-term entrusted loans of
                       Rmb200,000,000 was early settled during 2011. The remaining balance of Rmb190,000,000 of the
                       short-term entrusted loans and part of the long-term entrusted loan of Rmb17,953,000 were
                       settled in 2012. The remaining balance of the long-term entrusted loan of Rmb82,047,000 was
                       settled in January, 2013.
                 (2)   Pursuant to the board resolutions of the Company on August 28, 2010 and the entrusted loan
                       contract, the Company provided long-term entrusted loan during 2011 totalling Rmb200,000,000
                       with maturity date of April 25, 2013, to Hangzhou Canal Concord Property Co., Ltd., a
                       subsidiary of Hangzhou Concord Company, at a fixed interest rate of 12% per annum. Such
                       entrusted loan is guaranteed by World Trade Ltd in full. During the Period, such entrusted
                       loan was settled in full.
                 (3)   Pursuant to the board resolutions of the Company on June 11, 2012, and the entrusted loan
                       contract, the Company provided long-term entrusted loan during 2012 totalling Rmb120,000,000
                       with maturity date of January 17, 2014 to Zhejiang Canal Concord at a fixed interest rate of
                       12% per annum. Such entrusted loan is guaranteed by World Trade Ltd in full.
                 (4)   Pursuant to the board resolution of the Company on August 28, 2010, and entrusted loan
                       contract, the Company provided long-term entrusted loan during 2012 totalling Rmb190,000,000
                       with maturity date of February 7, 2014 to Zhejiang Canal Concord at a fixed interest
                       rate of 12% annually. Such entrusted loan is guaranteed by World Trade Ltd in full.
                 (5)   Pursuant to the board resolutions of Development Company on April 22, 2013, and the entrusted
                       loan contract, Development Company provided entrusted loan on April 27, 2013 totalling
                       Rmb50,000,000 with maturity date of April 27, 2014 to Zhejiang Canal Concord, at a fixed
                       interest rate of 12% per annum. Such entrusted loan is guaranteed by World Trade Ltd in full.
                 For the six months ended June 30, 2013, interest income recognised on the above entrusted loan
                 transactions with associates and its subsidiaries were Rmb23,548,000 (corresponding period of 2012:
                 Rmb33,762,000).
                 As at June 30, 2013, interest receivables on the above entrusted loan transactions with associates and
                 its subsidiaries were Rmb33,691,000 (December 31, 2012: Rmb47,604,000). The amount will be repaid at
                 maturity.

19.  Contingent Liabilities and Pledge of Assets
     As at June 30, 2013, Zhejiang Yuhang Expressway Co., Ltd. ("Yuhang Co.," a 51% owned subsidiary of the Company) provided a
     property under construction as a mortgaged asset for its domestic commercial bank loan of Rmb100,000,000. The
     carrying amount of the mortgaged asset was Rmb306,508,000. Besides, Jinhua Co provided the operating right of its
     expressway as pledged asset for its domestic commercial bank loans of Rmb870,000,000. The carrying amount of the
     pledged asset was Rmb1,933,302,000.
     Except for the above, as at June 30, 2013, the Group did not have any other contingent liabilities, pledge of
     assets or guarantees.

20.  Fair Value Measurements of Financial Instruments
     Fair value of the Group's financial assets that are measured at fair value on a recurring basis
     Some of the Group's financial assets are measured at fair value at the end of each reporting period. The
     following table gives information about how the fair values of these financial assets are determined (in
     particular, the valuation technique(s) and inputs used), as well as the level of the fair value hierarchy into
     which the fair value measurements are categorised (levels 1 to 3) based on the degree to which the inputs to the
     fair value measurements is observable.
     -   Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active market for
         identical assets;
     -   Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level
         1 that are observable for the asset, either directly (i.e. as prices) or indirectly (i.e. derived from
         prices); and
     -   Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset
         that are not based on observable market data (unobservable inputs).


                                                                   Basis of fair value                  Relationship of
                                                                   measurement/valuation  Significant   unobservable
                                     Fair value as at  Fair value  technique(s) and key   unobservable  inputs to fair
Financial assets  Classified as      June 30, 2013     hierarchy   input(s)               input(s)      value
                                     In Rmb'000
1) Equity         Held for           Assets -22,098    Level 1     Quoted bid prices in   N/A           N/A
   securities     trading                                          an active market.
   listed in      investments
   exchange
-----------------------------------------------------------------------------------------------------------------------
2) Fund listed    Held for           Assets -4,606     Level 1     Quoted bid prices in   N/A           N/A
   in exchange    trading                                          an active market.
                  investments
                  Available-for-sale Assets -59,275    Level 1     Quoted bid prices in   N/A           N/A
                  investments                                      an active market.
-----------------------------------------------------------------------------------------------------------------------
3) Debt           Held for           Assets -902,400   Level 1     Quoted bid prices in   N/A           N/A
   investments    trading                                          an active market.
   listed in      investments
   exchange
                  Available-for-sale Assets -122,000   Level 1     Quoted bid prices in   N/A           N/A
                  investments                                      an active market.
-----------------------------------------------------------------------------------------------------------------------
4) Investments    Available-for-sale Assets -99,468    Level 2     Shares of the net      N/A           N/A
   in structured  investments                                      assets of the
   products                                                        products, determined
                                                                   with reference to
                                                                   the net asset value
                                                                   of the products,
                                                                   calculated by
                                                                   observable (quoted)
                                                                   prices of underlying
                                                                   investment portfolio
                                                                   and adjustments of
                                                                   related expenses.
                                     Assets -40,065   Level 3      Discounted cash flow.  Actual yield  The higher
                                                                   Future cash flows are  of the        the actual
                                                                   estimated based on     underlying    yield, the
                                                                   applicable yield of    investment    higher the
                                                                   the underlying         portfolio     fair value
                                                                   investment portfolio
                                                                   and adjustments of
                                                                   related expenses,
                                                                   discounted at a rate
                                                                   that reflects the
                                                                   credit risk of
                                                                   various counterparties
-----------------------------------------------------------------------------------------------------------------------
5) Investments   Available-for-sale  Assets -41,824   Level 3      Discounted cash flow.  Actual yield  The higher
   in trust      investments                                       Future cash flows are  of the        the actual
   products                                                        estimated based on     underlying    yield, the
                                                                   applicable yield of    investments   higher the
                                                                   the underlying                       fair value
                                                                   investment and
                                                                   adjustments of
                                                                   related expenses,
                                                                   discounted at
                                                                   a rate that
                                                                   reflects the credit
                                                                   risk of various
                                                                   counterparties.
-----------------------------------------------------------------------------------------------------------------------

As at 30 June 2013 (unaudited)
                                                     Level 1            Level 2            Level 3              Total
                                                     Rmb'000            Rmb'000            Rmb'000            Rmb'000
-----------------------------------------------------------------------------------------------------------------------
Held for trading investments
  -- Equity securities
       Manufacturing                                  20,639                 --                 --             20,639
       Wholesaling                                     1,459                 --                 --              1,459
   -- Fund                                             4,606                 --                 --              4,606
   -- Debt investments
        Corporate bonds                              702,400                 --                 --            702,400
        Others                                       200,000                 --                 --            200,000
-----------------------------------------------------------------------------------------------------------------------
        Sub-total                                    929,104                 --                 --            929,104
-----------------------------------------------------------------------------------------------------------------------
Available-for-sale investments
  -- Fund                                             59,275                 --                 --             59,275
  -- Corporate bonds                                 122,000                 --                 --            122,000
  -- Structured products                                  --             99,468             40,065            139,533
  -- Trust products                                       --                 --             41,824             41,824
-----------------------------------------------------------------------------------------------------------------------
Sub-total                                            181,275             99,468             81,889            362,632
-----------------------------------------------------------------------------------------------------------------------
Total                                              1,110,379             99,468             81,889          1,291,736
-----------------------------------------------------------------------------------------------------------------------

There were no transfers between instruments in Level 1 and Level 2 during the six months ended 30 June 2013.

The following table represents the changes in Level 3 available-for-sale investments for the six months ended 30 June
2013.
                                                                     Structured              Trust
                                                                       products           products              Total
                                                                        Rmb'000            Rmb'000            Rmb'000
-----------------------------------------------------------------------------------------------------------------------
At beginning of this period                                                  --                 --                 --
Addition                                                                 40,000             41,000             81,000
Total gains in other comprehensive income                                    65                824                889
-----------------------------------------------------------------------------------------------------------------------
At end of the period                                                     40,065             41,824             81,889
-----------------------------------------------------------------------------------------------------------------------

21.  Summary of Financial Information of the Company

                                                                                         As at              As at
                                                                                       June 30,       December 31,
                                                                                          2013               2012
                                                                                       Rmb'000            Rmb'000
                                                                                    (Unaudited)    (Unaudited and
                                                                                                         restated)
     ---------------------------------------------------------------------------------------------------------------
      Investment in subsidiaries                                                     5,463,800          4,853,153
      Amounts due from subsidiaries                                                    655,348            522,694
      Other assets                                                                   7,652,227          8,454,104
     ---------------------------------------------------------------------------------------------------------------
                                                                                    13,771,375         13,829,951
     ---------------------------------------------------------------------------------------------------------------
      Total liabilities                                                              2,342,393          1,940,568
     ---------------------------------------------------------------------------------------------------------------
      Capital and reserves
        Share capital                                                                4,343,115          4,343,115
        reserves                                                                     7,085,867          7,546,268
     ---------------------------------------------------------------------------------------------------------------
                                                                                    11,428,982         11,889,383
     ---------------------------------------------------------------------------------------------------------------

22.  Events after the Reporting Period
     Pursuant to the board resolutions of the Company on March 19, 2013 and the acquisition agreement
     in respect of the Company's acquisition of 66.283% equity interest in Jinhua Co entered into between the Company
     and Communications Group on March 20, 2013, as at the date of this report, the Company has completed its capital
     injection in Jinhua Co of Rmb1,000,000,000. As a result, the registered capital of Jinhua Co was increased from
     Rmb900,000,000 to Rmb1,900,000,000. Simultaneously, Jinhua Co early repaid its entrusted loans from
     Communications Group of Rmb340,000,000, part of its loans from Zhejiang Communications Finance of Rmb30,000,000
     and part of its bank loans of Rmb570,000,000.

23.  Approval of Condensed Consolidated Financial Statements
     The condensed consolidated financial statements were approved and authorised for issue by the board of directors
     on August 28, 2013.

Corporate Information

Executive Directors                        Authorized Representatives
ZHAN Xiaozhang (Chairman)                  ZHAN Xiaozhang
LUO Jianhu (General Manager)               ZHANG Jingzhong
DING Huikang
                                           Statutory Address
Non-Executive Directors
                                           12/F, Block A, Dragon Century Plaza
LI Zongsheng                               1 Hangda Road
WANG Weili                                 Hangzhou City, Zhejiang Province
WANG Dongjie                               PRC 310007
                                           Tel: 86-571-8798 5588
Independent                                Fax: 86-571-8798 5599
Non-Executive Directors
                                           Legal Advisers
ZHANG Junsheng
ZHOU Jun                                   As to Hong Kong and US law:
PEI Ker-Wei                                Herbert Smith Freehills
                                           23rd Floor, Gloucester Tower
Supervisors                                15 Queen's Road Central
                                           Hong Kong
FU Zhexiang
WU Yongmin                                 As to English law:
LIU Haisheng                               Herbert Smith Freehills LLP
ZHANG Guohua                               Exchange House
ZHANG Xiahua                               Primrose Street
                                           London EC2A 2HS
Company Secretary                          United Kingdom
Tony Zheng                                 As to PRC law:
                                           T & C Law Firm
                                           11/F, Block A, Dragon Century Plaza
                                           1 Hangda Road
                                           Hangzhou City, Zhejiang Province
                                           PRC 310007
Auditors                                   H Shares Listing Information
Deloitte Touche Tohmatsu                   The Stock Exchange of Hong Kong Limited
35/F, One Pacific Place                    Code: 0576
88 Queensway
Hong Kong                                  London Stock Exchange Plc
Investor Relations Consultant              Code: ZHEH
Hill & Knowlton Strategies                 ADRs Information
36th Floor, PCCW Tower, Taikoo Place
979 King's Road, Quarry Bay                US Exchange: OTC
Hong Kong                                  Symbol: ZHEXY
Tel : 852-2894 6321                        CUSIP: 98951A100
Fax: 852-2576 1990                         ADR: H Shares 1:10
Principal Bankers                          Representative Office in Hong Kong
Industrial and Commercial Bank of China,   Suite 2910
 Zhejiang Branch                           29/F, Bank of America Tower
China Construction Bank, Zhejiang Branch   12 Harcourt Road
Shanghai Pudong Development Bank,          Hong Kong
 Hangzhou Branch                           Tel: 852-2537 4295
                                           Fax: 852-2537 4293
H Share Registrar and Transfer Office
                                           Website
Hong Kong Registrars Limited
Room 1712-1716, 17/F, Hopewell Centre      www.zjec.com.cn
183 Queen's Road East
Hong Kong

For Corporate Structure of the Group, please visit:
http://www.prnasia.com/sa/attachment/2013/08/20130830232758481010.pdf
For Financial Highlights, please visit:
http://www.prnasia.com/sa/attachment/2013/08/20130830232759631664.pdf
For Location Map of Expressways in Zhejiang Province, please visit:
http://www.prnasia.com/sa/attachment/2013/08/20130830232759792121.pdf
---------------------------------------------------------------------------------------------------
NOTE : To view the full set of the Company's 2013 Interim Report. Please visit www.zjec.com.cn
---------------------------------------------------------------------------------------------------
(Source: PR Newswire )
(Source: Quotemedia)

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