Hopewell Highway Infrastructure : Announces FY 2015/16 Final Results

Press Release

• Profit before net exchange gain/loss grew 15% yoy to RMB603 million

• Net profit attributable to owners of the Company decreased 2% yoy to RMB511 million or RMB16.59 cents per share, as core operation growth was mainly offset by net exchange loss

• Total dividend of RMB56.6 cents per share (final dividend of RMB8.2 cents per share; special final dividend of RMB40 cents per share; interim dividend of RMB8.4 cents per share)

• GS Superhighway's growth momentum has persisted. Nanguang Expressway and Longda Expressway (Shenzhen section) became toll-free since 7 February 2016 and impact on GS Superhighway has been slightly positive

• Western Delta Route ("WDR") first turned profitable in FY16 with net profit of RMB40 million in FY16 (HHI's share)

• RMB82 million of net exchange loss on RMB depreciation (HHI's share)

• No need for HHI to inject further capital into West Route JV

• Strong financial position and solid bases for strong dividend in the future with (i) HHI corporate level net cash of RMB652 million and (ii) steady dividends from the GS Superhighway JV

  Upcoming: FY17 and Beyond

• GS Superhighway JV borrowed RMB2 billion in August 2016 to reimburse past capital expenditure funded by its shareholders, which has strengthened HHI's financial position

• WDR is financially self-sufficient until at least 2020

• PBOC lending rate cuts will lower WDR's finance cost by approximately RMB58 million and RMB61 million in FY17 and FY18 respectively (HHI's share)

• FY17 net profit will be supported by healthy core operation

• GS Superhighway's profit sharing ratio will be adjusted from 48% to 45% starting from 1 July 2017

For the year under review, HHI's share of the aggregate net toll revenue increased by 4% from RMB1,919 million to RMB2,002 million. This was mainly due to the continuous healthy growth in toll revenue of the Guangzhou-Shenzhen Superhighway ("GS Superhighway") and the Western Delta Route.

Given healthy core operation, HHI's share of the aggregate EBITDA of toll expressways grew by 6%, from RMB1,602 million to RMB1,705 million. Western Delta Route first turned profitable in FY16 and recorded RMB40 million net profit during the year, compared to a net loss of RMB40 million in FY15 as shared by HHI. The Company's profit before net exchange gain/loss increased by 15%, from RMB526 million to RMB603 million. This was mainly attributable to the increase in net profit of the four expressway projects offsetting the fall in net interest income at corporate level. The Company recorded share of net exchange loss of RMB82 million on the GS Superhighway JV's US Dollar and HK Dollar loans due to RMB depreciation during the year. Overall, core operation growth of toll

expressways was mainly offset by the net exchange loss. As a result, the profit attributable to owners of the Company decreased by 2% to RMB511 million.

The Board of Directors has proposed a final dividend of RMB8.2 cents (equivalent to HK9.5484 cents at the exchange rate of RMB1: HK$1.16444) per share and a special final dividend of RMB40 cents (equivalent to HK46.5776 cents at the exchange rate of RMB1: HK$1.16444) per share for the year ended 30 June 2016 (30 June 2015: final dividend RMB8.4 cents per share). Shareholders will be given the option of electing to receive the dividend in either RMB or HK Dollars or a combination of RMB and HK Dollars. The proposed final dividend and special final dividend will be paid on 2 December 2016 to shareholders registered at the close of business on 1 November 2016.

Mr. Thomas Wu, Managing Director of HHI, said: "The economic development of the PRD region is expected to provide continuous growth momentum for the Company's toll road projects. We are confident that our operation will remain healthy."

The average daily toll revenue of the GS Superhighway increased by 3% to RMB8.7 million and its average daily full-length equivalent traffic grew by 4% to 92,000 vehicles, indicating growth momentum has persisted since the second half of FY15. Nanguang Expressway and Longda Expressway (Shenzhen section), which are parallel to Taiping to Nantou section of the GS Superhighway, became toll-free since 7 February 2016. The overall impact on the GS Superhighway has been slightly positive and HHI will closely monitor the situation.

The average daily toll revenue and average daily full-length equivalent traffic of the Western Delta Route continued to grow healthily by 8% and 12% to RMB2.9 million and 40,000 vehicles respectively, reaching historical high.

HHI enjoys a strong and solid financial position. As at 30 June 2016, HHI's net cash on hand (excluding JV companies) amounted to RMB652 million. The liquidity of HHI has been further improved after the West Route JV repaid in full the shareholder's loan advanced by HHI in respect of Phase II West. In addition, the completion of the loan rescheduling of the GS Superhighway JV and the West Route JV in respect of Phase I West has further strengthened JV companies' financial positions. In August 2016, the GS Superhighway JV borrowed RMB2 billion to reimburse past capital expenditure funded by its shareholders, which has strengthened HHI's financial position.

Details of the expressways' traffic and revenue figures can be found at the website: www.hopewellhighway.com

(in million RMB, unless otherwise stated)

N1: Net debt is defined as total debt (including shares of JV companies) less total bank balances and cash (including shares of JV companies).

N2: Net cash is defined as bank balances and cash less corporate debt, excluding JV companies' bank balances and cash of RMB262 million as at 30 June 2016 (as at 30 June 2015: RMB273 million).

N3: Average daily full-length equivalent traffic is defined as the total distance travelled by all vehicles on the expressway divided by the full length of the expressway and the number of days in the year under review.

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Hopewell Highway Infrastructure Limited, a subsidiary of Hopewell Holdings Limited, is a leading infrastructure company in the Pearl River Delta region and is involved in all phases of expressway infrastructure projects from initiating and promoting to developing and operating. The existing toll expressway projects held by HHI with total 6 lanes in dual directions include: (1) the Guangzhou-Shenzhen Superhighway, a major expressway connecting Guangzhou, Dongguan, Shenzhen and Hong Kong (certain sections being 10 lanes); (2) Phase I of the Western Delta Route ("Phase I West"), an expressway linking Guangzhou and Shunde; (3) Phase II of the Western Delta Route ("Phase II West"), an expressway linking the end of Phase I West in Shunde at the northern end and extending southwards to Zhongshan; and (4) Phase III of the Western Delta Route ("Phase III West") an expressway connecting Phase II West in Zhongshan at the northern end and extending southwards to Zhuhai.