China Communications Construction : 170829-Announcement of 2017 Interim Results

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

中國交通建設股份有限公司

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

Revenue of the Group for the six months ended 30 June 2017 amounted to RMB189,280 million, representing an increase of RMB6,967 million, or 3.8%, from RMB182,313 million for the corresponding period of 2016.

Gross profit for the six months ended 30 June 2017 amounted to RMB25,348 million, representing an increase of RMB3,314 million, or 15.0%, from RMB22,034 million for the corresponding period of 2016.

Operating profit for the six months ended 30 June 2017 amounted to RMB14,650 million, representing an increase of RMB1,404 million, or 10.6%, from RMB13,246 million for the corresponding period of 2016.

Profit attributable to owners of the parent for the six months ended 30 June 2017 amounted to RMB7,868 million, representing an increase of RMB610 million, or 8.4%, from RMB7,258 million for the corresponding period of 2016.

Basic earnings per share for the six months ended 30 June 2017 amounted to RMB0.43, as compared with RMB0.40 for the corresponding period of 2016.

The value of new contracts for the six months ended 30 June 2017 amounted to RMB431,240 million, representing an increase of 52.0% from RMB283,795 million for the corresponding period of 2016.

As at 30 June 2017, the backlog for the Group amounted to RMB1,329,864 million, as compared with RMB1,099,752 million as at 31 December 2016.

Notes: (1) The interests of the medium term notes (issued by the Company on 18 December 2014) have been generated but not yet declared, and the preference shares (issued by the Company in September and October 2015) were classified as equity instruments with deferrable and non-cumulative dividend distribution and payment. As a result, a total interest/dividend of RMB868 million should be deducted from earnings when calculated the earnings per share during the six months ended 30 June 2017.

(2) Any discrepancies between the amounts herein and the amounts set out in the tables herein are due to rounding.

The Board (the "Board") of Directors (the "Directors", each a "Director") of China Communications Construction Company Limited (the "Company", "CCCC" or "we") is pleased to announce the unaudited condensed consolidated interim results of the Company and all of its subsidiaries (hereinafter collectively referred to as, the "Group", except where the context otherwise requires) prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" for the six months ended 30 June 2017 as follows.

Facing the complicated and changeable situations at home and abroad in the first half of 2017, the Company advanced all kinds of work in a systematic and orderly manner by persisting on the overall keynote of seeking progress while maintaining stability, by satisfying the overall requirements of supply-side structural reform, and by speeding up reform and innovation, with the profitability and value-creating capability intensified continually.

In the first half of 2017, revenue of the Group was RMB189,280 million, representing a year-on-year increase of 3.8%; profit attributable to owners of the parent was RMB7,868 million, representing a year-on-year increase of 8.4%; and earnings per share was RMB0.43. New contracts amounted to RMB431,240 million, representing a year-on-year increase of 52.0%. As at 30 June 2017, the backlog of the Group amounted to RMB1,329,864 million, representing an increase of 20.9% compared with that as at the end of 2016.

As an important holding subsidiary of China Communications Construction Group (Limited) ("CCCG"), the Company's business performance played a decisive role in CCCG. In 2017, CCCG ranks the 103rd in the Fortune Global 500. In the Operating Results Assessment of State-owned Enterprises conducted by the SASAC, CCCG has been rated as a Grade A enterprise for twelve consecutive years. Meanwhile, CCCG has ranked the third in ENR's Top International Contractors and remained the first among the Chinese enterprises in the global ranking for eleven consecutive years.

In the first half of 2017, the Company achieved favourable production and operation results, with remarkable highlights shown. Firstly, the Company seized the opportunities from the national deployment of major plans and strategies to expand vigorously the market alongside the "One Belt, One Road" and the market in Central and Western China, fully coordinate the construction of Xiong'an New Area, positively promote the Yongding River Basin Harnessing Project, and strongly cultivate the rail transit, eco-environmental protection and overseas railway markets, thus achieving the sustainable expansion of market business regions and business fields, and contributing the rapid growth of business indicators. Secondly, the Company's major projects were advanced rapidly, including the pass-through of Hong Kong-Zhuhai-Macau Bridge, the opening to traffic of Kenya Mombasa-Nairobi Railway, and the full initiations of EPC Project of Malaysia East Coast Rail Link (Phase I), Third Runway of Hong Kong International Airport and BOT Project of Xinjiang Highway. Thirdly, by combining the pilot reform of CCCG as a state-owned asset investment company, the Company further gave prominence to the strengths of main businesses, and initiated the negotiated transfer of equity interests in Shanghai Zhenhua Heavy Industries Co., Ltd. ("ZPMC"), thus further enhancing our core competence.

No pain, no gain. The achievements in the first half of 2017 were hard-earned but inspiring, which not only enhanced our confidence and determination, but also laid a solid foundation for accomplishing our work tasks in the second half of 2017.

In the second half of 2017, the Company will continue to maintain strategic strength, enhance the overall planning and coordination while forging ahead, and will make all-out efforts to realize "stable growth" and "new breakthrough", get all kinds of reform tasks done steadfastly, and promote the sustainable and healthy development of our production and operation.

Firstly, reinforce the strengths of traditional market and continue enlarging the increments based on the annual business objectives. The Company will further dig out the potential opportunities of domestic market, particularly aim at the central and western markets, and aggressively engage in construction and development of urban agglomerations. The Company will deeply explore the market alongside the "One Belt, One Road", intensify the superiority as the "bellwether", and upgrade the overseas strategy.

Secondly, concentrate our efforts on operational excellence and quality and efficiency improvement to achieve substantial results. The Company will carry out the pressure and control of "two reserves" to ensure that the increase or decrease of trade and other receivables and amount due from contract customers is coordinated with the Company's business development, and reduce the occupation of funds. The Company will revitalise the stock assets, dispose of the inefficient and ineffective assets, and optimize the assets structure; strengthen the management and control over the interest-bearing liabilities, establish and use multiple financing channels, thus ensuring the annual interest-bearing liabilities to be controlled at a reasonable level; improve the cash flow position to make sure the annual operational net cash flow improved as compared to that of last year; reinforce operation management, intensify cost and expense control, improve practically the profitability of our main businesses, and tamp down the profit-making foundation.

Thirdly, deeply explore the reform potential to release system dividends and intensify development motivation. By virtue of the opportunity from the pilot reform of CCCG, the Company will promote the negotiated transfer of equity interests in ZPMC steadily, thus further highlighting the strengths of our main businesses; advance the reform in salary distribution system, and profoundly implement classified assessment and differentiated distribution according to the principle of "salary increases when profitability rises, salary decreases when profitability drops"; actively explore the implementation schemes for employee stock ownership, stock option incentive and equity dividend, and promote mixed ownership pilot reform in business segments or subsidiaries where conditions become mature.

Fourthly, continue strengthening risk prevention and control to reinforce various operating results. The Company will enhance the identification and warning of risk sources, attach great importance to compliance risk and safety risk, and focus on the control of overseas risk and financial risk, to prevent from any major risk or systematic risk; endeavour to prevent and control investment risk, reinforce control over project review, intensify compliance review and investment return, try to improve the professionalism and scientificness of investment decisions, particularly for PPP and other projects featured by large capital occupation scale and long payback period, enhance full-process management, greatly improve the operating capability, and optimize the exit mechanism, thus guaranteeing the investment safety and reasonable returns.

The work objectives have been set, the approaches have been defined and the confidences have been gathered in the second half of 2017. For this purpose, the management personnel at various levels and all employees of the Company will unite as one and act bravely to open a new epoch of reform and create opportunities for development with the winning courage, high morale and genuine effort, and spare no effort to accomplish the annual objectives and tasks satisfactorily.

In the first half of 2017, in terms of the domestic market, China's economy maintained the mid-to- high growth momentum, with the GDP growth rate at 6.9% on a year-on-year basis, showing the distinct signs of stabilization and recovery. The fixed-asset investment in infrastructure increased by 21.1% on a year-on-year basis, accounting for 21.2% of the national investment in fixed assets, representing the highest investment proportion since 2010, and once again making infrastructure investment become an important measure to stabilize China's economic growth. Wherein, the investment in the public facilities management industry increased by 25.4%, that in the road transportation industry increased by 23.2%, and that in the water conservancy management industry increased by 17.5%. The rapid increase in fixed assets investment in the aforesaid segment markets, on the one hand, reflected that the implementation and commencement speed of the contracted orders was accelerated, and on the other hand, it showed that the fixed assets investment highlighted by urban infrastructure construction and highway construction enjoyed high-speed growth, for which PPP mode, as a major form of participation of the social capital, played an important role in promoting the development of the aforesaid project fields. Meanwhile, the water transportation and railway construction markets remained running at high level, but the increment of investment was limited.

In terms of the international market, the global economy operated in slight fluctuations, while the fixed-asset investment in infrastructure rose steadily. The Company profoundly participated in the "One Belt, One Road" Summit Forum and the Global Infrastructure Investment and Construction Forum, firmly completed the major projects with satisfactory results, and continuously enhanced our comprehensive influence. In June, the EPC Project of Malaysia East Coast Rail Link (Phase

I) exclusively undertaken by the Company was accelerated to enter into the implementation stage. This is another railway EPC project undertaken by the Company with the largest single amount, following the Kenya Mombasa-Nairobi Railway, which was open to traffic this May. It is not only the largest overseas project under construction undertaken by Chinese enterprises, but also the largest single project under the "One Belt, One Road" initiative, which will comprehensively promote the coordinated development of Malaysia's economy and society.

In the first half of 2017, revenue of the Group was RMB189,280 million, representing a year- on-year increase of 3.8%; and the value of new contracts amounted to RMB431,240 million, representing a year-on-year increase of 52.0%. As at 30 June 2017, the backlog of the Group amounted to RMB1,329,864 million, representing an increase of 20.9% as compared with that as at the end of 2016.

In the first half of 2017, revenue of the Group derived from overseas markets amounted to RMB41,174 million (equivalent to approximately USD6,078 million, including revenue realised from export trade of domestically manufactured industrial products and the same hereinafter), representing approximately 21.8% of the Group's revenue. The value of new contracts from overseas markets amounted to RMB140,252 million (equivalent to approximately USD21,120 million), representing approximately 32.5% of the Group's new contract value. According to statistics, as of 30 June 2017, the Company conducted businesses in 148 countries and regions, of which a total of 871 foreign contracting engineering projects were under construction, with the total value of contracts amounting to approximately USD101,100 million.