深深房B:2023年半年度报告（英文版）

ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE

& PROPERTIES (GROUP) CO. LTD.INTERIM REPORT 2023

【August 2023】

1ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part I Important Notes Table of Contents and Definitions

The Board of Directors (or the “Board”) the Supervisory Committee as well as the directors

supervisors and senior management of ShenZhen Special Economic Zone Real Estate &

Properties (Group) Co. Ltd. (hereinafter referred to as the “Company”) hereby guarantee the

factuality accuracy and completeness of the contents of this Report and its summary and

shall be jointly and severally liable for any misrepresentations misleading statements or

material omissions therein.Tang Xiaoping the Company’s General Manager Wang Jianfei the Company’s Chief

Financial Officer and Zhou Hongpu head of the Company’s financial department (equivalent

to financial manager) hereby guarantee that the Financial Statements carried in this Report

are factual accurate and complete.All the Company’s directors have attended the Board meeting for the review of this Report

and its summary.Certain descriptions about the Company’s operating plans or work arrangements for the

future mentioned in this Report and its summary the implementation of which is subject to

various factors shall NOT be considered as promises to investors. Therefore investors and

interested parties are reminded to be sufficiently aware of the risks involved and understand

the differences between plans forecasts and promises.The Company has no interim dividend plan either in the form of cash or stock.This Report and its summary have been prepared in both Chinese and English. Should there

be any discrepancies or misunderstandings between the two versions the Chinese versions

shall prevail.

2ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Table of Contents

Part I Important Notes Table of Contents and Defin... 2

Part II Corporate Information and Key Financial In... 6

Part III Management Discussion and Analysis ......... 9

Part IV Corporate Governance ....................... 22

Part V Environmental and Social Responsibility ..... 23

Part VI Significant Events ......................... 24

Part VII Share Changes and Shareholder Information.. 30

Part VIII Preferred Shares ......................... 34

Part IX Bonds ...................................... 35

Part X Financial Statements ........................ 36

3ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Documents Available for Reference

1. The financial statements with the personal signatures and stamps of the Company’s legal

representative Chief Financial Officer and head of the financial department; and

2. The originals of all the documents and announcements disclosed by the Company on Securities

Times China Securities Journal and Ta Kung Pao during the Reporting Period.

4ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Definitions

Term Definition

The State-owned Assets Supervision and Administration Commission of the

“Shenzhen SASAC” or the “Municipal SASAC”

People’s Government of Shenzhen Municipal

SIHC Shenzhen Investment Holdings Co. Ltd.ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd.The “Company” the “Group” “SPG” or “we”

and its consolidated subsidiaries except where the context otherwise requires

Shenzhen Property Management Shenzhen Property Management Co. Ltd.Petrel Hotel Shenzhen Petrel Hotel Co. Ltd.Zhentong Engineering Shenzhen Zhentong Engineering Co. Ltd.Huazhan Construction Supervision Shenzhen Huazhan Construction Supervision Co. Ltd.Jianbang Group Guangdong Jianbang Group (Huiyang) Industrial Co. Ltd.Chuanqi Real Estate Development Shenzhen SPG Chuanqi Real Estate Development Co. Ltd.

5ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part II Corporate Information and Key Financial Information

I Corporate Information

Stock name SPG SPG-B Stock code 000029 200029

Stock exchange for stock

Shenzhen Stock Exchange

listing

Company name in Chinese 深圳经济特区房地产(集团)股份有限公司

Abbr. (if any) 深房集团

Company name in English (if

ShenZhen Special Economic Zone Real Estate&Properties (Group).co.Ltd．

any)

Abbr. (if any) SPG

Legal representative Tang Xiaoping

II Contact Information

Board Secretary Securities Representative

Name Luo Yi Hong Lu

47/F SPG Plaza Renmin South Road 47/F SPG Plaza Renmin South Road

Address Luohu District Shenzhen Guangdong Luohu District Shenzhen Guangdong

P.R.China P.R.China

Tel. （86 755）25108897 （86 755）25108837

Fax （86 755）82294024 （86 755）82294024

Email address spg@sfjt.sihc.com.cn spg@sfjt.sihc.com.cn

III Other Information

1. Contact Information of the Company

Indicate by tick mark whether any change occurred to the registered address office address and their zip codes website address

email address and other contact information of the Company in the Reporting Period.□ Applicable □ Not applicable

No change occurred to the said information in the Reporting Period which can be found in the 2022 Annual Report.

2. Media for Information Disclosure and Place where this Report is Kept

Indicate by tick mark whether any change occurred to the information disclosure media and the place for keeping the Company’s

periodic reports in the Reporting Period.□ Applicable □ Not applicable

The website of the stock exchange the media and other websites where the Company’s periodic reports are disclosed as well as

the place for keeping such reports did not change in the Reporting Period. The said information can be found in the 2022 Annual

Report.

6ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

3. Other Information

Indicate by tick mark whether any change occurred to other information in the Reporting Period.□ Applicable □ Not applicable

IV Key Financial Information

Indicate by tick mark whether there is any retrospectively restated datum in the table below.□ Yes □ No

H1 2023 H1 2022 Change (%)

Operating revenue (RMB) 263616779.07 366184498.90 -28.01%

Net profit attributable to the

listed company’s shareholders -37118182.81 145128330.14 -125.58%

(RMB)

Net profit attributable to the

listed company’s shareholders

-42468909.1517139162.56-347.79%

before exceptional gains and

losses (RMB)

Net cash generated from/used

-192140948.04-548115143.3464.95%

in operating activities (RMB)

Basic earnings per share

-0.03670.1435-125.57%

(RMB/share)

Diluted earnings per share

-0.03670.1435-125.57%

(RMB/share)

Weighted average return on

-0.94%3.66%-4.60%

equity (%)

30 June 2023 31 December 2022 Change (%)

Total assets (RMB) 5453181740.50 5689769802.18 -4.16%

Equity attributable to the

listed company’s shareholders 3903638382.72 4004240547.70 -2.51%

(RMB)

V Accounting Data Differences under Chinese Accounting Standards (CAS) and

International Financial Reporting Standards (IFRS) and Foreign Accounting Standards

1. Net Profit and Equity Differences under CAS and IFRS

□ Applicable □ Not applicable

Unit: RMB

Net profit attributable to the listed company’s Equity attributable to the listed company’s

shareholders shareholders

H1 2023 H1 2022 Ending amount Beginning amount

Under CAS -37118182.81 145128330.14 3903638382.72 4004240547.70

Adjusted as per IFRS

Under IFRS -37118182.81 145128330.14 3903638382.72 4004240547.70

2. Net Profit and Equity Differences under CAS and Foreign Accounting Standards

□ Applicable □ Not applicable

No such differences for the Reporting Period.

7ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

3. Reasons for Accounting Data Differences Above

□ Applicable □ Not applicable

XI Exceptional Gains and Losses

□ Applicable □ Not applicable

Unit: RMB

Item Amount Note

Gain or loss on disposal of non-current

assets (inclusive of impairment 3750.50

allowance write-offs)

Government subsidies charged to current

profit or loss (exclusive of government

subsidies consistently given in the

123732.31 Government grants received

Company’s ordinary course of business

at fixed quotas or amounts as per

government policies or standards)

Gain or loss on assets entrusted to other Change in fair value of monetary fund investments

3638607.35

entities for investment or management and return on investment

Gain or loss on contingencies unrelated

to the Company's normal business 1644822.69

operations

Non-operating income and expense other

-37754.41

than the above

Less: Income tax effects 22432.10

Total 5350726.34

Details of other gains and losses that meet the definition of exceptional gain/loss:

□ Applicable □ Not applicable

No such cases for the Reporting Period.Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item listed in the Explanatory Announcement

No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss Items:

□ Applicable □ Not applicable

No such cases for the Reporting Period.

8ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part III Management Discussion and Analysis

I Principal Activity of the Company in the Reporting Period

(I) Industry review for the Reporting Period

In the first half of 2023 as the economy and society fully returned to normal operations macro policies took

effect and the national economy rebounded. The Central Government actively expressed support for the real

estate sector to guide its healthy development. Various regulatory policies were relaxed financing channels for

real estate companies expanded interest rate cuts supported residential mortgages but the policy effects were

somewhat delayed and market confidence is expected to further recover.(II) Review of the Company’s operations in the Reporting Period

Facing an increasingly complex external context and tougher reform and development tasks in the Reporting

Period the Company conscientiously implemented the decisions and arrangements of the State-owned Assets

Supervision and Administration Commission of the People’s Government of Shenzhen Municipality (Municipal

SASAC) and Shenzhen Investment Holdings Co. Ltd. (SIHC). Under the leadership of the new leadership team

SPG employees worked in unity took concrete actions demonstrated the Company’s resilience and maintained

an upward development trend. The main achievements are as follows:

1. Stable and orderly operations in the core business. The Company focused on project planning schedule and

milestone management. Through BIM technology empowerment and adherence to high standards we ensured

the schedule and quality of projects under construction like SPG Guangmingli. We made full efforts to promote

sales and marketing for projects. Since the opening in late April the SPG Guangmingli project display centre

has hosted over 1000 customers. The Donghu Mingyuan project cleared out remaining units. We strengthenedoperations of our own properties leveraged the development of “Buildings for Shenzhen-Hong Kong SpecialtyIndustry” to promote leasing and operations for SPG Plaza’s existing properties. In the first half of the year

newly leased areas were 2374 square meters renewed leased areas were 10690 square meters and the

occupancy rate reached 74.21%. We intensified efforts to sell existing housing inventory. Properties like Floors

1-2 of Guoshang Mansion and Buildings 25 and 26 of Wenjin Garden were successfully listed on The Stock

Exchange of Hong Kong Limited.

2. Made full efforts to tap potentials and expand. We thoroughly explored internal business potentials and

managed affiliated enterprises. The newly signed construction contracts worth RMB142 million for Zhentong

Engineering. We added RMB49.775 million in online signed sales for Shantou Branch expanded supervision

projects by 2 for Huazhan Construction Supervision and turned losses into profits for Petrel Hotel. We

vigorously activated internal stock resources accelerated the land title confirmation for the “Xinfeng Building”

project and signed a transaction agreement with the counterparty for the sale of commercial land in Los

9ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Angeles USA. We proactively promoted land investment tracked real estate market conditions closely

followed Shenzhen land auction dynamics and continued land expansion research.

3. Accelerated exploration of future development. To implement high-quality development requirements we

systematically and deeply investigated the Company’s current management status and external environment

and examined and revised the Group’s “14th Five-Year” strategic plan from a higher perspective clarifying

future guidelines and strategic tasks to form a framework for the “14th Five-Year” strategic plan revision. We

continued to strengthen tracking of the China Securities Regulatory Commission’s adjustments to optimise

equity financing policies for real estate enterprises conducted research on future development accordingly and

strove to achieve synergistic breakthroughs in the process of supporting the controlling shareholder’s

development strategy.

4. Continuously consolidated the internal control foundation. Nearly 50 new management systems were

formulated across the Company in the first half of the year. We optimized procurement and cost control systems

managed project costs throughout the entire process conducted in-depth risk control and internal audits on

capital usage and contract management and continuously strengthened the internal control system foundation.Adhering to bottom-line thinking in view of the growing risks in the industry we made forward-looking

assessments combining our project situations to effectively prevent and resolve operational risks and safeguard

state-owned assets. We strengthened financial coordination to guarantee project development and operating

capital needs and persevered in production safety petition management public opinion monitoring and other

efforts to create a harmonious and stable environment for development.

5. Party building provided cohesive strength. We adhered to high-quality Party building to lead high-qualitydevelopment giving full play to the Party organisation’s leadership role in “setting the direction managing thebig picture and ensuring implementation”. We gradually built an internal Party supervision-led “megasupervision” system with dedicated and business supervision mutually coordinated. We implemented

responsibilities for Party management and governance and continuously consolidated the Party building

foundation in basic organisations systems and teams. Combining practice we carried out in-depth education

focused strengths to solve problems and promote development used “One Brand for One Enterprise” Party

building brand as a carrier to pool internal strengths and advanced the integration of Party building with

business management.The Company is subject to the information disclosure requirements for the real estate industry in the Disciplinary and

Regulatory Guideline No. 3 of the Shenzhen Stock Exchange for Listed Companies—Industry-specific Information

Disclosure.Cumulative land bank:

Floor area available for

Name of project/area Site area（0000 ㎡） Floor area（0000 ㎡）

development（0000 ㎡）

Xinfeng Building in Shantou 0.59 2.66 2.66

Linxinyuan Phase II 2.57 7.72 7.72

Linxinyuan Phase III 4.31 9.57 9.57

10ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Linxinyuan Phase IV 3.23 6.45 6.45

Total 10.70 26.40 26.40

Development status of major projects:

Plann Floor Cumu

ed area lativel ExpecTime compl Cumuted

The for floor y

Name Site area eted

lative

total

Comp comm % % compl

City/r of Locati area with in the

invest

Status any’s encem devel constr eted mentegion projec on （㎡ plot Curre floor ment intere ent of oped uctedt ） ratio nt

(RMB

st constr area

（㎡ Period’0000（㎡ ’0000uction （㎡ ) )）））

Frame

Linxi

work 11

Huizh nyuan Huiya 51.00 64.00 6427 1597 1157 7458

in June 64%

ou Phase ng

constr % % 8 61 50 4

I 2021

uction

Found

SPG Guan 19

ation

Shenz Guan gming 100.0 Januar 74.00 1072 5360 1517 1124

pit 74%

hen gming Distri

being 0%

y % 1 5 58 37

li ct 2022

built

Sales status of major projects:

Pre-

Floor Pre-sale/sa

Cumul area les Floor

sale/sa

Floor Floor atively pre- revenu area

les

The area area pre- sold/so

Cumul

e settled

revenu

atively e

Name Compa with availab sold/so ld in genera in the

City/re Locati settled settled

of Status ny’s plot le for ld the te in Curren

gion on

project interes ratio sale floor Curren

floor

the t

in the（㎡（㎡ area t area Period Current Curren（㎡ Period (㎡) ）（㎡t

） t

）（㎡PeriodPeriod ） (RMB’

） (RMB’ 0000)

0000)

Chuan

Luohu Ready

Shenz Dongh 100.00

Distric for 55727 32857 32857 194 1483 32857 194 1483

hen u

t sale %

Mingy

uan

Longg

Ready

Shenz Cuilin ang 100.00

for 60111 56137 52884 52884 2469

hen yuan Distric

sale %

Chaoy

Tianyu Ready

Shanto ang 100.00 15347 16037 11773 10547

ewan for 2850 1656 3818 2180

u Distric

Phase I sale % 0 2 4 3

Tianyu Chaoy

Ready

Shanto ewan ang 100.00 12777 13705

for 33893 5622 3221 31993 6481 3672

u Phase Distric

sale % 0 9

II t

Huiya

Linxin On

Huizh ng 51.00 15976 15976

yuan pre- 2792 2236 2558

ou Distric

Phase I sale % 1 1

Rental status of major projects:

Name of The Company’s Rentable area Cumulative Average

Location Use

project interest （㎡） rented area occupancy rate

11ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

（㎡）

Real Estate

Shenzhen Commercial 100.00% 3413.88 3413.88 100.00%

Mansion

North Tower of

Guoshang Shenzhen Commercial 100.00% 4819.71 4819.71 100.00%

Mansion

Petrel Building Shenzhen Commercial 100.00% 22475.47 22475.47 100.00%

SPG Plaza Shenzhen Office building 100.00% 60747.69 32333.08 53.23%

Podium of SPG

Shenzhen Commercial 100.00% 19886.3 16123.49 81.08%

Plaza

Wenjin Garden Shenzhen Commercial 100.00% 3531.60 3531.60 100.00%

Primary land development:

□ Applicable □ Not applicable

Financing channels:

Financing cost Maturity structure

Financing Ending balance

range/average

channel of financings

financing cost Within 1 year 1-2 years 2-3 years Over 3 years

Bank loans 161876610.82 3.70%-4.20% 19983173.22 79432000.00 62461437.60

Total 161876610.82 19983173.22 79432000.00 62461437.60

Development strategy and operating plan for the coming year:

In the second half of the year the Company will anchor its annual key tasks and goals focusing on completing

the clearance of existing housing inventory the construction and sales of the Guangmingli project advancing

the construction of “Buildings for Shenzhen-Hong Kong Specialty Industry” and exploring new paths forfuture development. We will exert all efforts to “maintain sales reduce inventory prevent fluctuations expandgrowth improve quality and enhance vitality” effectively tackling the challenges of future development.

1. Prioritise “Sales Volume”. The Company will seize the market window control marketing milestones and

strengthen marketing’s coordination and guidance for project sales across its affiliated enterprises. Through a

multidimensional approach encompassing market analysis product positioning target audience identification

channel integration and atmosphere enhancement we will diversify customer acquisition and conversion

methods. We are fully committed to achieving the annual sales target for the Guangmingli project and driving

sales for projects such as Tianyuewan by the Shantou Branch.

2. Focus on “Reducing Inventory”. The Company will align with market demand leverage resources from

agency platforms refine broad-based marketing incentives explore self-developed customer channels and

strive to achieve the annual sales target for legacy projects. We will strengthen intermediary channel

engagement and promotion facilitating transactions for properties such as Guoshang Yitai and Wenjin Garden.Benchmarking against the market we will proactively enhance existing products intensify self-owned property

leasing efforts and endeavour to fulfill the overall annual task target.

3. Expand “Sales Growth”. The Company will consistently drive the activation of internal assets and unearth

operational potential continually expanding resources and performance in the core business. Following the

annual task objectives set at the beginning of the year we will focus on managing affiliated enterprise

operations maximizing potential and striving to achieve the annual revenue target. Efforts will be made to

12ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

activate legacy internal resources and bolster core business reserves. We will vigorously advance the revision

and development of the “14th Five-Year” strategic plan guiding future corporate reform and development.

4. Enhance “Quality”. The Company will concentrate on elevating operational planning capabilities centering

on high-efficiency coordination of projects cycles and expertise across the entire spectrum of our core business.Operating plans will serve as the main thread aiming for development progress and quality focusing on key

milestones optimizing project organisation and controlling development timelines to improve operational

quality and efficiency. A comprehensive optimisation of the marketing system will be pursued from dimensions

such as market research product positioning customer analysis and channel integration continuously

enhancing marketing capabilities for new and existing projects. The construction of the organisational system

and supportive capacity will be reinforced actively securing specialised talents for future development

enhancing incentive and restraint mechanisms and unlocking internal value creation.

5. Mitigate “Variable Risks”. The Company will thoroughly assess potential risks in investment and project

expansion establish risk assessment and early warning mechanisms and minimise future project risks. We will

proactively address and mitigate potential risks explore financing channels and ensure project funding

requirements are met.

6. Boost “Energy”. The Company will persistently uphold its Party building responsibilities strengthen ethical

and clean governance safeguard ideological positions promote the deep integration of Party building and

operations and harness the “red engine” of Party building to drive high-quality development. We will translate

the results of theme education into tangible work outcomes leveraging the “One Brand for One Enterprise”Party building brand to explore new paths for integrating Party building and business fortify our “battlefortress” and strive to be the “pioneers of challenges” continuously harnessing the guiding and safeguarding

power of Party building.Provision of guarantees for homebuyers on bank mortgages:

□ Applicable □ Not applicable

Guarantee amount (R

Project Guarantee period Note

MB’0000)

Until the property ownership certificate is registered as

Shanglinyuan 49.35

collateral and handed over to bank for keeping

Until the property ownership certificate is registered as

Cuilinyuan 2148.92

collateral and handed over to bank for keeping

Chuanqi Donghu Until the property ownership certificate is registered as

1229.46

Mingyuan collateral and handed over to bank for keeping

Until the property ownership certificate is registered as

Tianyuewan 33640.55

collateral and handed over to bank for keeping

Until the property ownership certificate is registered as

Linxinyuan 970.00

collateral and handed over to bank for keeping

Total 38038.27

Joint investments by directors supervisors and senior management and the listed company (applicable for such investments where

the directors supervisors and senior management are the major source of investment):

13ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

□ Applicable □ Not applicable

Compatibilit

Investment As % of the Cumulative

Type of As % of total Disinvestme y of actual

Project amount peak of returns

investor investment nt investment

(RMB) project funds (RMB)

and returns

Director

supervisor or

senior

Linxinyuan 8950000.00 39.25% 0.90% 0.00 N/A N/A

management

of the

Company

II Core Competitiveness Analysis

As the earliest real estate developer founded in the Shenzhen Special Economic Zone the Company helped

build the early city and has created a number of "first places" in the history of real estate development in China.For example the first to use the paid state-owned land the first to introduce the foreign investment for the

cooperative land development the first to raise development funds by means of pre-sale of buildings the first to

carry out public bidding for construction projects in accordance with international practices the first to set up a

property management company to the buildings and residences developed in an all-rounded manner as well as

winning the bid in the new China’s first auction of land use rights held in the Shenzhen Special Economic Zone.After more than 40 years of development the Company has grown into a business group with real estate

development and operation as its main business integrating engineering and construction project supervision

asset management and other diversified operations. It has paid great efforts to the establishment of a modern

enterprise HR management system and works hard in building a professional and high-quality development

team. It also keeps improving the management mechanism and processes for project development. As a result

its planning construction cost control sales ability and brand image have been effectively improved. More

importantly its main business operation ability and core competitiveness have been greatly enhanced.The Company has been granted the titles of “Socially Responsible Company” and “Honest (Quality) Company”

in the real estate sector of Shenzhen for two consecutive years. Additionally it was selected as one of the "Most

Valuable Brands for Investment of Chinese Listed Companies" and "Most Socially Responsible Brands of

Chinese Listed Companies" in the 2022 Brand Power (Longcheng) Forum & the Fourth Conference on Top 500

Brands of Chinese Listed Companies.III Core Business Analysis

Overview:

See contents under the heading “I Principal Activity of the Company in the Reporting Period” above.Year-on-year changes in key financial data:

Unit: RMB

H1 2023 H1 2022 Change (%) Main reason for change

Decreased revenue

Operating revenue 263616779.07 366184498.90 -28.01%

from property sales

Cost of sales 217229426.83 239885272.72 -9.44%

Selling expense 8790640.18 10726031.33 -18.04%

14ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Project development

Administrative expense 23453199.45 33013300.52 -28.96% and staff structure

adjustments

Decreased bank

Finance costs -612267.71 -3601554.32 83.00% balances and deposit

interest income

Income tax expense -2580629.05 59036968.69 -104.37% Decreased gross profit

Decreased payment of

Net cash generated land value-added tax

from/used in operating -192140948.04 -548115143.34 -64.95% for the Chuanqi

activities Donghu Mingyuan

project

A payment for the

Net cash generated disposal of subsidiary

from/used in investing 138197734.83 255526904.00 -45.92% was received in the

activities same period of last

year

Net cash generated

Additional bank loan in

from/used in financing 38186866.07

activities the current period

Decreased payment of

land value-added tax

for the Chuanqi

Net increase in cash

-15583954.90 -292337340.43 94.67% Donghu Mingyuan

and cash equivalents

project and receipt of

payment for disposal of

subsidiary

Major changes in the profit structure or sources of the Company in the Reporting Period:

□ Applicable □ Not applicable

Net profit largely came from recurrent business operations in the current period while in the same period of last year exceptional

gains such as income from the disposal of subsidiary were the primary sources of net profit.Breakdown of operating revenue:

Unit: RMB

H1 2023 H1 2022

As % of total As % of total Change (%)

Operating revenue operating revenue Operating revenue operating revenue

(%)(%)

Total 263616779.07 100% 366184498.90 100% -28.01%

By operating division

Property sales 72404365.93 27.47% 228409271.55 62.38% -34.91%

Engineering and

149278954.1356.63%103248547.5928.20%28.43%

construction

Rental service 35655793.46 13.53% 16729533.24 4.57% 8.96%

Property

1579444.440.60%11075828.003.02%-2.42%

management

Other 4698221.11 1.78% 6721318.52 1.84% -0.06%

By product category

Residential units 71997900.22 27.31% 223833107.28 61.13% -33.82%

Shops and parking

406465.710.15%4576164.271.25%-1.10%

lots

Other 191212413.14 72.53% 137775227.35 37.62% 34.91%

By operating segment

Guangdong

263276484.9599.87%318380165.3286.95%12.92%

Province

Other regions in 0.00 0.00% 47804333.58 13.05% -13.05%

15ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

China

Overseas 340294.12 0.13% 0.00 0.00% 0.13%

Operating division product category or operating segment contributing over 10% of operating revenue or operating profit:

□ Applicable □ Not applicable

Unit: RMB

YoY change in YoY change in YoY change in

Operating Gross profit

Cost of sales operating cost of sales gross profit

revenue margin

revenue (%) (%) margin (%)

By operating division

Property sales 72404365.93 49079740.50 32.21% -68.30% -52.94% -22.13%

Engineering

and 149278954.13 146071686.99 2.15% 44.58% 44.62% -0.02%

construction

Rental service 35655793.46 18005836.85 49.50% 113.13% -4.71% 62.44%

Property

1579444.441266665.0819.80%-85.74%-88.24%17.03%

management

Other 8634903.49 2805497.41 67.51% 28.47% -42.94% 40.66%

By product category

Residential

71997900.2248682064.0432.38%-67.83%-51.52%-22.76%

units

Shops and

406465.71397676.462.16%-91.12%-89.77%-12.86%

parking lots

Other 195149095.52 168149686.33 13.84% 41.64% 24.02% 12.25%

By operating segment

Guangdong

265244826.14217229426.8318.10%-16.69%12.51%-21.26%

Province

Main business data of the most recent period restated according to changed statistical caliber for the Reporting period

□Applicable □ Not applicable

IV Non-Core Business Analysis

□Applicable □ Not applicable

V Analysis of Assets and Liabilities

1. Significant Changes in Asset Composition

Unit: RMB

30 June 2023 31 December 2022 Reason for any

Change in

As a % of total As a % of total significant

Amount Amount percentage (%)

assets assets change

Monetary

182290539.133.34%197663949.743.47%-0.13%

assets

Accounts

55880663.331.02%63580422.161.12%-0.10%

receivable

4239904684. 4257109614. Development

Inventories 77.75% 74.82% 2.93%

21 31 of projects

Investment

554694578.3310.17%566873915.079.96%0.21%

property

Long-term

equity 93927.64 0.00% 93927.64 0.00% 0.00%

investments

Fixed assets 20677375.65 0.38% 21425475.05 0.38% 0.00%

Right-of-use

166069.100.00%232496.720.00%0.00%

assets

16ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Short-term

45050727.800.83%51138077.620.90%-0.07%

borrowings

Contract

34256336.950.63%43533467.290.77%-0.14%

liabilities

Additional

Long-term

141893437.60 2.60% 54261000.00 0.95% 1.65% bank loan in the

borrowings

current period

Lease liabilities 12377.36 0.00% 53885.23 0.00% 0.00%

Accounts

398857036.047.31%434601559.677.64%-0.33%

payable

Payment of

land VAT of

Donghu

Taxes payable 37570635.93 0.69% 190951185.99 3.36% -2.67%

Mingyuan in

the current

period

Other payables 555065599.75 10.18% 574331340.84 10.09% 0.09%

2. Major Assets Overseas

□Applicable □ Not applicable

3. Assets and Liabilities at Fair Value

□ Applicable □ Not applicable

Unit: RMB

Gain/loss

on fair- Cumulative Impairment

Purchased

value fair-value allowance Sold in the

Beginning in the Other Ending

Item changes in changes for the Reporting

amount Reporting changes amount

the charged to Reporting Period

Period

Reporting equity Period

Period

Financial

assets

1. Held-

for-trading

financial

assets 40815436 3477115.5 13663850 27499296

(excluding 1.42 6 8.21 8.77

derivative

financial

assets)

Investment

13839235.14191290.

s in other 352055.06

equity 57 63

instruments

Total of the 42199359 3477115.5 13663850 28918425

352055.060.000.000.00

above 6.99 6 8.21 9.40

Financial

0.000.00

liabilities

Other change

Significant changes to the measurement attributes of the major assets in the Reporting Period:

17ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

□Yes □ No

4. Restricted Asset Rights as at the Period-End

Item Ending carrying value Reasons

Project of public facilities inside and

surrounding the urban renewal project

Monetary assets 5674439.78

of Longgang District Shenzhen-

construction funds

Lands mortgaged for project

Inventories 965000000.00

development loans

Monetary assets 388115.74 Frozen in a lawsuit case

Accounts receivable 45050727.80 Put in pledge for short-term borrowings

Total 1016113283.32

VI Investment Analysis

1. Total Investments Made

□Applicable □ Not applicable

2. Significant Equity Investments Made in the Reporting Period

□Applicable □ Not applicable

3. Significant Non-equity Investments Ongoing in the Reporting Period

□Applicable □ Not applicable

4. Financial Investments

(1) Securities Investments

□Applicable □ Not applicable

No such cases in this Reporting Period

(2) Investment in Derivative Financial Instruments

□Applicable □ Not applicable

No such cases in this Reporting Period

5. Use of Funds Raised

□Applicable □ Not applicable

No such cases in this Reporting Period

18ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

VII Sale of Major Assets and Equity Interests

1. Sale of Major Assets

□Applicable □ Not applicable

No such cases in this Reporting Period

2. Sale of Major Equity Interests

□Applicable □ Not applicable

VIII Principal Subsidiaries and Joint Stock Companies

□ Applicable □ Not applicable

Principal subsidiaries and joint stock companies with an over 10% effect on the Company’s net profit:

Unit: RMB

Relationshi Main

Company business Registered Operating Operating p with the Total assets Net assets Net profit

name scope capital revenue profit Company

Guangdong

Jianbang

Developme - - -

Group 2800000.0 14919576

Subsidiary nt of real 19769341. 0.00 4072785.2 4072785.2

(Huiyang)

estate 0 25.03

Industrial 08 5 5

Co. Ltd.Shenzhen

SPG

Developme - -

Chuanqi 30000000. 11381920 99233917

Subsidiary nt of real 0.00 1842727.0 1842727.0

Real Estate

estate 00 24.84 2.23

Developme 1 1

nt Co. Ltd.Shenzhen

SPG Developme

30000000.1074269758461951.4062693.3

Longgang Subsidiary nt of real 548923.64 859592.64

Developme estate 00 3.70 25 6

nt Co. Ltd.Shantou

SEZ

Wellam

Developme - -

FTY 91226120. 85268682. 35546282.Subsidiary nt of real 176190.48 54758534. 54758534.Building

estate 44 06 68

Developme 76 76

nt Co.Ltd.Shantou

Huafeng Developme

80000000.8061506917728461.54475318.

Real Estate Subsidiary nt of real 138083.09 103562.32

Developme estate 00 9.31 45 71

nt Co. Ltd.Great Wall -

Rental 2051146.0 20170752. - -

Estate Co. Subsidiary 93266727. 340294.12

Inc. (U.S.) services 0 91 142447.83 142447.83 89

Shenzhen

Zhentong 10000000. 28256789 20620413. 15014450

Subsidiary Installation 273084.09 254677.82

Engineerin 00 2.90 10 6.81

g Co. Ltd.Shenzhen Rental 30000000. 44040875. 36941391. 7685132.3

Subsidiary 22759.58 17069.68

Petrel services 00 42 53 5

19ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Hotel Co. and

Ltd. property

manageme

Shenzhen

Huazhan

Constructio

Constructio 8000000.0 9993923.7 9655166.6 - -

Subsidiary n 944339.63

supervision 0 3 8 712985.53 712985.53

Supervisio

n Co. Ltd.Investment

Xin Feng - - -

and 33834528

Enterprise Subsidiary 502335.00 23141812 5047162.1 5047162.1

manageme

Co. Ltd. 6.36

nt 7.59 2 2

Subsidiaries obtained or disposed in the Reporting Period:

□Applicable □ Not applicable

Information about major majority- and minority-owned subsidiaries:

1. In May 2021 through the payment of consideration of RMB450 million the Group acquired 51% equity interest in Guangdong

Jianbang Group (Huiyang) Industrial Co. Ltd. The project company will develop the Linxingyuan Project with a gross site area of

200000 square meters and a total capacity building area of 0.4 million square meters which will be developed in four phases. The

Group has control over the project company which will be included in the scope of consolidation in May 2021. As of 30 June

2023 eight residential buildings of Phase I have been capped the basement of Phase II has been completed the development of

Phase III and Phase IV are to be initiated and construction permit has not been granted for the school. There were no sales in the

first half of 2023.

2. In October 2021 the Company won the bid for a land plot in Guangming District and established the project company Shenzhen

SPG Chuanqi Real Estate Development Co. Ltd. to be responsible for the development and construction of the land. In the first

half of 2023 actual investment totaled RMB55.61 million which was mainly made in main construction.

3. The subordinate subsidiaries engaged in real estate development also include: Shenzhen SPG Longgang Development Co. Ltd.

Shantou SEZ Wellam FTY Building Development Co. Ltd. Shantou Huafeng Real Estate Development Co. Ltd. The

Cuilinyuan project developed by Shenzhen SPG Longgang Development Co. Ltd. recorded no sales in the first half of 2023.Jinyedao and YuejingDongfang developed by Shantou SEZ Wellam FTY Building Development Co. Ltd. left a few amount of

remaining buildings for sale. And Shantou Huafeng Real Estate Development Co. Ltd. was responsible for the development of

Tianyuewan project (divided into Phase I and Phase II). Tianyuewan Phase I was open for sale in October 2016 and completed in

December 2019. The Phase II started construction in November 2018 and was completed at the end of June 2021. The overall

sales progress is relatively slow with an accumulated sales rate of about 74% for Phase I and 25% for Phase II.

4. Shenzhen Zhentong Engineering Co. Ltd. was engaged in the business of building installation and maintenance with the H1

2023 operating revenues of RMB150 million and of 56.96% to the operating revenues of the Company.

5. The H1 2023 net profit of Xin Feng Enterprise Co. Ltd. was of RMB-5.0472 million which mainly due to the changes of

exchange rate and it conducts no business.

6. The H1 2023 net profit of Shenzhen Petrel Hotel Co. Ltd. was of RMB17 thousand representing a return to profitability which

was mainly due to the fact that the market and business environment improved during the Reporting Period.IX Structured Bodies Controlled by the Company

□Applicable □ Not applicable

X Risks Facing the Company and Countermeasures

(I) Macroeconomic risks and countermeasures

20ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

The real estate industry has a greater correlation with the macroeconomy and is more influenced by the

macroeconomic cycle. Currently the foundation for sustained domestic economic recovery remains unsteady

while the external environment grows increasingly complex and challenging with global economic fluctuations

trending downward. The Company will continue to pay attention to the international and domestic

macroeconomic situation and actively adjust its business strategy.(II) Industry development risks and countermeasures

During the Reporting Period there was a decrease in the new construction area of real estate while completed

area increased. Overall construction area declined. In the short term real estate development investment will

continue to operate at a low level and the real estate market remains in a phase of turbulent adjustment. The

Company will continue to deepen its research on industry policies follow the national strategies innovate its

operating model and optimize its development method.(III) Business operating risks and countermeasures

In the first half of 2023 the sales prices of new commodity housing in cities decreased year-on-year. Product

destocking has slowed down leading to compressed profit margins. The Company will pay close attention to

changes in markets and industry policies focus on project construction and real estate sales to strengthen the

foundation of the main business. At the same time the Company will actively explore new areas and cultivate

new business models.

21ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part IV Corporate Governance

I Annual and Extraordinary General Meeting Convened during the Reporting Period

1. General Meetings Convened during the Reporting Period

Investor

Meeting Type Convened date Disclosure date Resolution of meeting

participation ratio

Resolutions of First

Extraordinary General

The First

Meeting in 2023 disclosed

Extraordina Extraordinary

on China Securities

ry General General 62.31% 30 March 2023 31 March 2023

Securities Times Ta Kung

Meeting in Meeting

Pao and

2023

www.cninfo.com.cn (No.:

2023-014)

Resolutions of 2022

Annual General Meeting

The 2022 disclosed on China

Annual Annual General

62.37% 28 April 2023 29 April 2023 Securities Securities

General Meeting

Meeting Times Ta Kung Pao and

www.cninfo.com.cn (No.:

2023-020)

2. Extraordinary General Meeting Convened at Request of Preference Shareholders with Resumed

Voting Rights

□Applicable □ Not applicable

II Change of Directors Supervisors and Senior Management

□Applicable □ Not applicable

Name Office title Type Date Reason

Tang Xiaoping Chairman of the Board Elected 30 March 2023

Zhang Manhua Director Elected 30 March 2023

Wen Li Director Left office 30 March 2023

Lu Haiyan Supervisor Elected 28 March 2023

Feng Hongwei Supervisor Left office 28 March 2023

III Interim Dividend Plan

□Applicable □ Not applicable

The Company has no interim dividend plan either in the form of cash or stock.IV Equity Incentive Plans Employee Stock Ownership Plans or Other Incentive Measures

for Employees

□Applicable □ Not applicable

No such cases in the Reporting Period.

22ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part V Environmental and Social Responsibility

I Major Environmental Issues

Indicate by tick mark whether the Company or any of its subsidiaries is a heavily polluting business identified by the

environmental protection authorities of China.□Yes □ No

Administrative penalties imposed for environmental problems during the Reporting Period

Influence on

Rectification

Name Reason Case Result production and

measures

operation

N/A N/A N/A N/A N/A N/A

Other environmental information disclosed with reference to the heavily polluting business

The Company and its subsidiaries are not imposed any administrative penalties for environmental problems during the Reporting

Period.Measures taken to decrease carbon emission in the Reporting Period and corresponding effects

□Applicable □ Not applicable

Reason for failure of disclosing other environmental information

The Company and its subsidiaries isn’t a heavily polluting business identified by the environmental protection authorities of China.II Social Responsibility

While pursuing economic benefits and protecting the interests of shareholders the Company proactively

fulfilled its social responsibilities demonstrating the Company’s social value and responsibilities. During the

Reporting Period the Company has diligently adhered to its mission awareness. It has firmly grasped the most

pressing and direct interests of the people establishing a list of tangible projects that serve the welfare of the

people. 1. The Company has demonstrated care for families facing family planning difficulties within itsjurisdiction. It donated RMB30000 to the Jiabei Community for the “Support for Family Planning and Care forFamilies in Need” donation campaign joining hands to provide care and support. 2. Collaborating with property

management companies the Company has jointly built a safety line. It organised emergency evacuation drills

for commercial tenants in properties under its jurisdiction enhancing public awareness of fire safety and

prevention. 3. The Company has invested in commissioning the natural gas transformation of gas pipelines in its

own old residential communities. It has strongly supported the government’s “tank-to-pipe” project to eliminate

safety hazards.

23ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part VI Significant Events

I Commitments of the Company’s De Facto Controller Shareholders Related Parties and

Acquirers as well as the Company Itself and Other Entities Fulfilled in the Reporting

Period or Ongoing at the Period-End

□Applicable □ Not applicable

No such cases in the Reporting Period.II Occupation of the Company’s Capital by the Controlling Shareholder or any of Its

Related Parties for Non-Operating Purposes

□Applicable □ Not applicable

No such cases in the Reporting Period.III Irregularities in the Provision of Guarantees

□Applicable □ Not applicable

No such cases in the Reporting Period.IV Engagement and Disengagement of Independent Auditor

Are the interim financial statements audited?

□Yes □ No

The interim financial statements have not been audited.V Explanations Given by the Board of Directors and the Supervisory Committee Regarding

the Independent Auditor's “Modified Opinion” on the Financial Statements of the

Reporting Period

□Applicable □ Not applicable

VI Explanations Given by the Board of Directors Regarding the Independent Auditor's

“Modified Opinion” on the Financial Statements of Last Year

□Applicable □ Not applicable

VII Insolvency and Reorganization

□Applicable □ Not applicable

No such cases in the Reporting Period.VIII Legal Matters

Significant lawsuits and arbitrations:

24ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

□ Applicable □ Not applicable

Involved Index to

General Decisions and Execution of Disclosure

amount Provision Progress disclosed

information effects decisions date

(RMB’0000) information

? Xi’an Business

Tourism Company

Limited

(hereinafter

referred to as“BusinessCompany”) had to Shaanxi High

pay for the People’s Court

compensation Sold all assets

RMB36.62 million of Business

and the relevant Company by

interest (from 14 auction in

September 1998 to accordance

the payment day) to with laws in

Xi’an Fresh Peak 2004. The

Company within applicant has

one month after the received Annual

judgment entering RMB15.20 Report 2022

into force. If the million. Now

Xi’an Project In Business Company 18 March (No.: 2023-2154 No Business

Lawsuit execution failed to pay in Company has 2023 010) on

time it had to pay no executable www.cninfo.double debt properties and com.cn

interests to Xi’an Xi’an Joint

Fresh Peak Commission

Company for the on Commerce

overdue period; * has been

Xi’an Joint refusing to

Commission on execute the

Commerce had ruling. It is

jointly and difficult to

severally obligation recover the

of the interests of rest.the compensation; .* Business

Company shall bear

RMB227500 of the

acceptance fee and

the security fee.As Jianbang Group

is incapable of

paying the

commercial bills

due in January

2022 which total

SPG is

RMB177151400

actively

Huizhou Annual

Judgment negotiating

Mingxiang Report 2022

was with Jianbang

Lawsuit of Economic 18 March (No.: 2023-

17715.14 No rendered and the

bill dispute Information 2023 010) on

in the first plaintiffs for

Consulting Co. www.cninfo.instance an all-

Ltd. Huizhou com.cn

inclusive

Huiyang Hongfa

solution.Industry & Trade

Co. Ltd. and

Huizhou

Jinlongsheng

Industrial Co. Ltd.brought a lawsuit

25ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

on the bill dispute

to the People’s

Court of Huiyang

District. The

Huiyang District

Court ruled at first

instance in March

2023 that Jianbang

should pay the

acceptance bill

amount and

interest.Other legal matters:

□Applicable □ Not applicable

IX Punishments and Rectifications

□Applicable □ Not applicable

X Credit Quality of the Company as well as its Controlling Shareholder and De Facto

Controller

□Applicable □ Not applicable

XI Major Related-Party Transactions

1. Continuing Related-Party Transactions

□Applicable □ Not applicable

No such cases in the Reporting Period.

2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests

□Applicable □ Not applicable

No such cases in the Reporting Period.

3. Related Transactions Regarding Joint Investments in Third Parties

□Applicable □ Not applicable

No such cases in the Reporting Period.

4. Amounts Due to and from Related Parties

□Applicable □ Not applicable

No such cases in the Reporting Period.

5. Transactions with Related Finance Companies

□Applicable □ Not applicable

26ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

The Company did not make deposits in receive loans or credit from and was not involved in any other finance business with any

related finance company or any other related parties.

6. Transactions with Related Parties by Finance Companies Controlled by the Company

□Applicable □ Not applicable

The finance company controlled by the Company did not make deposits receive loans or credit from and was not involved in any

other finance business with any related parties.

7. Other Major Related-Party Transactions

□Applicable □ Not applicable

No such cases in the Reporting Period.XII Major Contracts and Execution thereof

1. Entrustment Contracting and Leases

(1) Entrustment

□Applicable □ Not applicable

No such cases in the Reporting Period.

(2) Contracting

□Applicable □ Not applicable

No such cases in the Reporting Period.

(3) Leases

□Applicable □ Not applicable

No such cases in the Reporting Period.

2. Major Guarantees

□ Applicable □ Not applicable

Unit: RMB’0000

Guarantees provided by the Company as the parent and its subsidiaries for external parties (exclusive of those for subsidiaries)

Disclosu

re date Guarante

Actual

of the Line of Actual Type of Counter Term of Having e for a

guarante Collatera

Obligor guarante guarante occurren guarante guarante guarante expired related

e line e ce date e l (if any)

amount e (if any)

e or not party or

announc not

ement

Guarantees provided by the Company as the parent for its subsidiaries

Disclosu Actual Guarante

Line of Actual Type of Counter Term of Having

re date guarante Collatera e for a

Obligor guarante occurren guarante guarante guarante expired

of the e

e ce date e l (if any)

e or not

guarante amount e (if any) party or

27ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

e line not

announc

ement

From the

date of

signing

100%

the

equity

guarante

interests

Shenzhe contract

Shenzhe

n SPG to the

n SPG

Chuanqi date

18 Chuanqi

Real 17 June when all

March 50000 9929 Pledge Real Not Not

Estate 2022 guarante

2022 Estate

Develop ed debts

Develop

ment are

ment

Co. Ltd. uncondit

Co. Ltd.ionally

held by

and

the

irrevoca

Compan

bly paid

off in

full.Total approved line Total actual amount

for such guarantees of such guarantees in

500009929

in the Reporting the Reporting Period

Period (B1) (B2)

Total approved line Total actual balance

for such guarantees of such guarantees at

at the end of the 50000 the end of the 9929

Reporting Period Reporting Period

(B3) (B4)

Guarantees provided between subsidiaries

Disclosu

re date Guarante

Actual

of the Line of Actual Type of Counter Term of Having e for a

guarante Collatera

Obligor guarante guarante occurren guarante guarante guarante expired related

e line e ce date e l (if any)

amount e (if any)

e or not party or

announc not

ement

Total guarantee amount (total of the three kinds of guarantees above)

Total guarantee line Total actual

approved in the guarantee amount in

500009929

Reporting Period the Reporting Period

(A1+B1+C1) (A2+B2+C2)

Total actual

Total approved

guarantee balance at

guarantee line at the

50000 the end of the 9929

end of the Reporting

Reporting Period

Period (A3+B3+C3)

(A4+B4+C4)

Total actual guarantee amount (A4+B4+C4)

2.54%

as % of the Company’s net assets

Of which:

Total of the three amounts above (D+E+F) 9929

Compound guarantees

3. Cash Entrusted for Wealth Management

□ Applicable □ Not applicable

28ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Unit: RMB’0000

Unrecovered

Unrecovered overdue amount

Type Funding source Amount Undue amount

overdue amount with provision for

impairment

Other Self-funded 39015.11 27499.3 0 0

Total 39015.11 27499.3 0 0

High-risk entrusted wealth management with significant single amount or low security and poor liquidity:

□Applicable □ Not applicable

Whether there is the case where the principal cannot be recovered at maturity or other case which may cause impairment for

entrusted wealth management

□Applicable □ Not applicable

4. Other Significant Contracts

□Applicable □ Not applicable

No such cases in the Reporting Period.XIII Other Significant Events

□ Applicable □ Not applicable

(I) On 30 March 2023 the Company held the First Extraordinary General Meeting in 2023 at which the non-

independent directors and independent directors for the eighth Board of Directors and the non-employee

supervisors for the eighth Supervisory Committee were elected. Together with the employee supervisor who

was elected at a workers’ congress they formed the new Board of Directors and Supervisory Committee. For

further information see Announcement No. 2023-017 on the Re-election of the Board of Directors and the

Supervisory Committee dated 31 March 2023.(II) In accordance with the provisions of the Articles of Association "the legal representative of the Company

shall be the chairman of the board of directors of a company". The Company has completed the formalities for

the change of its registered corporate information on 17 April 2023 and the legal representative of the

Company has been changed from Mr. Liu Zhengyu to Mr. Tang Xiaoping.XIV Significant Events of Subsidiaries

□Applicable □ Not applicable

29ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part VII Share Changes and Shareholder Information

I Share Changes

1. Share Changes

Unit: share

Before Increase/decrease (+/-) in the current period After

dividend Percenta New dividend Subtot Percenta

Shares converte Other Shares

ge (%) issues converte al ge (%)

d from

capital

profit

reserves

1. Restricted shares 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00 0.00%

1.1 Shares held by the

0.000.00%0.000.000.000.000.000.000.00%

state

1.2 Shares held by state-

0.000.00%0.000.000.000.000.000.000.00%

own legal person

1.3 Shares held by other

0.000.00%0.000.000.000.000.000.000.00%

domestic investors

Among which: shares

held by domestic legal 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00 0.00%

person

Shares held by

0.000.00%0.000.000.000.000.000.000.00%

domestic natural person

1.4 Oversea

0.000.00%0.000.000.000.000.000.000.00%

shareholdings

Among which: shares

held by oversea legal 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00 0.00%

person

Shares held by

0.000.00%0.000.000.000.000.000.000.00%

oversea natural person

101166100.001011660

2. Unrestricted shares 0.00 0.00 0.00 0.00 0.00 100.00%

0000.00%000.00

8916608916600

2.1 RMB ordinary shares 88.14% 0.00 0.00 0.00 0.00 0.00 88.14%

000.0000.00

2.2 Domestically listed 120000 1200000

11.86%0.000.000.000.000.0011.86%

foreign shares 000.00 00.00

2.3 Oversea listed

0.000.00%0.000.000.000.000.000.000.00%

foreign shares

2.4 Other 0.00 0.00% 0.00 0.00 0.00 0.00 0.00 0.00 0.00%

101166100.001011660

3. Total shares 0.00 0.00 0.00 0.00 0.00 100.00%

0000.00%000.00

Reasons for share changes:

□Applicable □ Not applicable

Approval of share changes:

30ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

□Applicable □ Not applicable

Transfer of share ownership:

□Applicable □ Not applicable

Progress on any share repurchase:

□Applicable □ Not applicable

Progress on reducing the repurchased shares by means of centralized bidding:

□Applicable □ Not applicable

Effects of share changes on the basic and diluted earnings per share equity per share attributable to the Company’s ordinary

shareholders and other financial indicators of the prior year and the prior accounting period respectively:

□Applicable □ Not applicable

Other information that the Company considers necessary or is required by the securities regulator to be disclosed:

□Applicable □ Not applicable

2. Changes in Restricted Shares

□Applicable □ Not applicable

II. Issuance and Listing of Securities

□Applicable □ Not applicable

III. Total Number of Shareholders and Their Shareholdings

Unit: share

Total number of ordinary Total number of preference shareholders

shareholders at the period- 44842 with resumed voting rights at the period- 0

end end (if any) (see Note 8)

Shareholding of ordinary shareholders holding more than 5% shares or the top 10 of ordinary shareholders

Increa Shares in

se/dec Restrict pledge

Sharehold

Total ordinary rease ed Non-restricted marked or

Nature of ing

Name of shareholder shares held at in the ordinary ordinary frozen

shareholder percentag

the period-end Report shares shares held Sh

e Stat

ing held are

Period s

Shenzhen Investment State-owned

55.78%564353838564353838

Holdings Co. Ltd. corporation

Domestic

Shenzhen State-Owned

non-state-

Equity Operation and 6.35% 64288426 64288426

owned legal

Management Co. Ltd.person

Domestic

Yang Jianmin natural 1.08% 10972077 10972077

person

Domestic

Zhang Xiujuan natural 0.47% 4760400 4760400

person

Domestic

Wang Yulan natural 0.44% 4427191 4427191

person

Domestic

Pan Jun natural 0.41% 4160000 4160000

person

31ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Domestic

He Qiao natural 0.40% 4042586 4042586

person

Hong Kong Securities Foreign

0.39%39466753946675

Clearing Company Ltd. legal person

Domestic

Cao Benming natural 0.33% 3356800 3356800

person

Domestic

Wang Zhengying natural 0.29% 2924200 2924200

person

Strategic investor or general legal person becoming a

None

top-10 ordinary shareholder due to rights issue (if any)

Among the top 10 shareholders of the Company Shenzhen State-owned

Equity Management Co. Ltd. is a wholly-owned subsidiary of

Shenzhen Investment Holdings Co. Ltd. The Company does not know

Related or acting-in-concert parties among the

whether there exists associated relationship among the other

shareholders above

shareholders or whether they are persons acting in concert as

prescribed in the Administrative Measures for the Acquisition of Listed

Companies.Explain if any of the shareholders above was involved

in entrusting/being entrusted with voting rights or None

waiving voting rights

Special account for share repurchases (if any) among

None

the top 10 shareholders

Top 10 unrestricted ordinary shareholders

Unrestricted ordinary shares held at the Shares by type

Name of shareholder

period-end Type Shares

Shenzhen Investment Holdings Co. RMB ordinary

564353838564353838

Ltd. shares

Shenzhen State-Owned Equity RMB ordinary

6428842664288426

Operation and Management Co. Ltd. shares

RMB ordinary

Yang Jianmin 10972077 10972077

RMB ordinary

Zhang Xiujuan 4760400 4760400

RMB ordinary

Wang Yulan 4427191 4427191

RMB ordinary

Pan Jun 4160000 4160000

RMB ordinary

3889900

He Qiao 4042586 Domestically

listed foreign 152686

Hong Kong Securities Clearing RMB ordinary

39466753946675

Company Ltd. shares

RMB ordinary

Cao Benming 3356800 3356800

RMB ordinary

Wang Zhengying 2924200 2924200

Among the top 10 unrestricted public shareholders of the Company Shenzhen State-

Related or acting-in-concert parties owned Equity Management Co. Ltd. is a wholly-owned subsidiary of Shenzhen

among top 10 unrestricted public

Investment Holdings Co. Ltd. The Company does not know whether there exists

shareholders as well as between top 10

unrestricted public shareholders and associated relationship among the other shareholders or whether they are persons

top 10 shareholders acting in concert as prescribed in the Administrative Measures for the Acquisition of

Listed Companies.Among the top 10 shareholders of the Company the third fourth seventh ninth and

Top 10 ordinary shareholders involved

10th shareholders held 9804200 shares 4760400 shares 3732000 shares 3351800

in securities margin trading (if any)

shares and 2924200 shares in their respective credit securities accounts.Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the

32ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Company conducted any promissory repo during the Reporting Period.□Yes □ No

No such cases in the Reporting Period.IV Change in Shareholdings of Directors Supervisors and Senior Management

□ Applicable □ Not applicable

Restricted Restricted Restricted

Beginnin Increase Decrease shares shares shares

Ending

g in the in the granted at granted in granted at

Office Incumben sharehold

Name sharehold Reporting Reporting the the the

title t/Former ing

ing Period Period period- Reporting period-

(share)

(share) (share) (share) beginning Period end

(share) (share) (share)

Lu Superviso Incumben

02000200000

Haiyan r t

Total -- -- 0 200 0 200 0 0 0

V Change of the Controlling Shareholder or the De Facto Controller

Change of the controlling shareholder in the Reporting Period

□Applicable □ Not applicable

No such cases in the Reporting Period.Change of the de facto controller in the Reporting Period

□Applicable □ Not applicable

No such cases in the Reporting Period.

33ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part VIII Preference Shares

□Applicable □ Not applicable

No preference shares in the Reporting Period.

34ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part IX Bonds

□Applicable □ Not applicable

35ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Part X. Financial Statements

I. Auditor’s Report

Whether the semi-annual report has been audited?

□ Yes √ No

The semi-annual report of the Company has not been audited.II. Financial Statements

The financial statements of the company have been prepared in China Yuan.

1. Consolidated Statement of Financial Position

Prepared by Shenzhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd

As at 30 June 2023

Presented in RMB

Item 30 June 2023 1 January 2023

Current assets:

Cash at bank and on hand 182290539.13 197663949.74

Provision of Settlement fund

Funds lent

Financial assets held for trading 274992968.77 408154361.42

Derivative financial assets

Notes receivable 1536150.00

Accounts receivable 55880663.33 63580422.16

Accounts receivable financing

Prepayments 762828.19 1163612.24

Insurance premiums receivables

Cession premiums receivables

Provision of cession premiums

Other receivables 21922385.34 42105050.33

Including: Interest receivable

Dividends receivable

Recoursable Financial assets

acquired

Inventories 4239904684.21 4257109614.31

Contractual assets

Assets held for sale

Non-current assets due within one

year

Other current assets 38594239.68 36778641.42

Total current assets 4814348308.65 5008091801.62

Non-current assets:

36ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Loans and payments

Debt investment

Investments in other debt

obligations

Long-term receivables

Long-term equity investments 93927.64 93927.64

Investments in other equity

14191290.6313839235.57

instrument

Other non-current financial assets

Investment property 554694578.33 566873915.07

Fixed assets 20677375.65 21425475.05

Construction in progress

Productive living assets

Oil and gas assets

Right-of-use assets 166069.10 232496.72

Intangible assets

Development costs

Goodwill

Long-term deffered expense 1829989.34 2176221.53

Deferred tax assets 47180201.16 77036728.98

Other non-current assets

Total non-current assets 638833431.85 681678000.56

Total assets 5453181740.50 5689769802.18

Current liabilities:

Short-term loans 45050727.80 51138077.62

Borrowings from central bank

Deposit funds

Financial liabilities held for

trading

Derivative financial liabilities

Notes payable

Accounts payable 398857036.04 434601559.67

Advances from customers 4871471.88 5465343.96

Contractual liabilities 34256336.95 43533467.29

Funds from sale of financial

assets with repurchase

agreements

Deposits from customer and

interbank

Funds received as an agent of

stock exchange

Funds received as stock

underwrite

Payroll payable 26107904.96 35724203.78

Tax payable 37570635.93 190951185.99

Other payables 555065599.75 574331340.84

Including: Interest payable 16535277.94 16535277.94

Dividends payable

Handling charges and

commissions payable

Cession premiums payables

Liabilities held for sale

37ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Non-current liabilities due within

20066196.666188794.43

one year

Other current liabilities 2844613.84 3882817.68

Total current liabilities 1124690523.81 1345816791.26

Non-current liabilities:

Provision for insurance contracts

Long-term loans 141893437.60 54261000.00

Debentures payable

Including: Preferred shares

Perpetual bonds

Lease liabilities 12377.36 53885.23

Long-term payables

Long-term employee benefits

payable

Provisions

Deferred income

Deferred tax liabilities 3096348.02 3096348.02

Other non-current liabilities

Total non-current liabilities 145002162.98 57411233.25

Total liabilities 1269692686.79 1403228024.51

Equity:

Share capital 1011660000.00 1011660000.00

Other equity instruments

Including: Preferred shares

Perpetual bonds

Capital reserves 978244910.11 978244910.11

Less: treasury shares

Other comprehensive income 24153998.68 25926720.85

Specific reserve

Surplus reserve 275253729.26 275253729.26

Generic Risk Reserve

Retained earnings 1614325744.67 1713155187.48

Total equity attributable to

3903638382.724004240547.70

shareholders of the company

Non-controlling interests 279850670.99 282301229.97

Total equity 4183489053.71 4286541777.67

Total liabilities and equity 5453181740.50 5689769802.18

Legal representative: Xiaoping Tang General Accountant：JianFei Wang The head of the accounting

department: Hongpu Zhou

2. Financial Position Statement of the Parent Entity

Presented in RMB

Item 30 June 2023 1 January 2023

Current assets:

Cash at bank and on hand 109865577.44 92377124.60

Financial assets held for trading 274992968.77 408154361.42

Derivative financial assets

Notes receivable

Accounts receivable 5229812.62 11706678.21

38ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Accounts receivable financing

Prepayments 200000.00 200000.00

Other receivables 1736355470.74 1711880332.45

Including: Interest receivable

Dividends receivable 34222722.88 39222722.88

Inventories 296848.69 4854703.53

Contractual assets

Assets held for sale

Non-current assets due within one

year

Other current assets 1360584.56 1138065.43

Total current assets 2128301262.82 2230311265.64

Non-current assets:

Debt investment

Investments in other debt

obligations

Long-term receivables

Long-term equity investments 1582275489.49 1582275489.49

Investments in other equity

14191290.6313839235.57

instruments

Other non-current financial assets

Investment property 444517161.22 455917024.15

Fixed assets 13310408.53 14046375.35

Construction in progress

Productive living assets

Oil and gas assets

Right-of-use assets

Intangible assets

Development costs

Goodwill

Long-term deferred expense 1218574.62 1381401.99

Deferred tax assets 190733.76 29502067.58

Other non-current assets

Total non-current assets 2055703658.25 2096961594.13

Total assets 4184004921.07 4327272859.77

Current liabilities:

Short-term loans

Financial liabilities held for

trading

Derivative financial liabilities

Notes payable

Accounts payable 11573238.42 17666752.61

Advances from customers

Contractual liabilities 88985.71 184985.71

Payroll payable 14503407.76 21167813.42

Tax payable 26164837.11 178147095.75

Other payables 178966190.10 184614308.51

Including: Interest payable 16535277.94 16535277.94

Dividends payable

Liabilities held for sale

Non-current liabilities due within

125173.220.00

one year

39ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Other current liabilities 4449.29 9249.29

Total current liabilities 231426281.61 401790205.29

Non-current liabilities:

Long-term loans 62461437.60 0.00

Debentures payable

Including: Preferred shares

Perpetual bonds

Lease liabilities

Long-term payables

Long-term employee benefits

payable

Provisions

Deferred income

Deferred tax liabilities 3096348.02 3096348.02

Other non-current liabilities

Total non-current liabilities 65557785.62 3096348.02

Total liabilities 296984067.23 404886553.31

Equity:

Share capital 1011660000.00 1011660000.00

Other equity instruments

Including: Preferred shares

Perpetual bonds

Capital reserves 964711931.13 964711931.13

Less: treasury shares

Other comprehensive income 1731481.74 1379426.68

Specific reserve

Surplus reserve 252124115.85 252124115.85

Retained earnings 1656793325.12 1692510832.80

Total equity 3887020853.84 3922386306.46

Total liabilities and equity 4184004921.07 4327272859.77

3. Consolidated Statement of Profit or Loss and Other Comprehensive Income

Presented in RMB

Item 6 months ended 30 June 2023 6 months ended 30 June 2022

1. Revenue 263616779.07 366184498.90

Including: Operating revenue 263616779.07 366184498.90

Interest income

Insurance premium income

Handling charge and

commission income

2. Expenses 310757866.31 337004632.25

Including: operating expenses 217229426.83 239885272.72

Interest expense

Handling charge and

commission expense

Refund of Insurance premium

Net payment for insurance

claims

Net provision for insurance

contracts

Commissions on insurance

40ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

polices

Cession charges

Taxes and surcharges 61896867.56 56981582.00

Selling and distribution expense 8790640.18 10726031.33

General and administrative

23453199.4533013300.52

expenses

Research and development

expense

Financial expense -612267.71 -3601554.32

Including: Interest expense

Interest income 716366.12 2903815.84

Add: Other income 123732.31 400232.43

Investment income (“-” for

1806314.48166815177.24

losses)

Including: Income from

investment in associates and joint

ventures (“-” for losses)

Income from derecognition of

financial assets at amortized cost

(“-” for loss)

Foreign exchange gain (“-” for

loss)Net gain on exposure hedges (“-” for loss)

Gains from changes in fair value

3477115.564963730.62

(“-” for losses)

Credit impairment loss (“-” for

529176.78131316.20

loss)

Impairment losses (“-” for

losses)

Gains from assets disposal (“-”

for losses)

3. Operating profit (“-” for loss) -41204748.11 201490323.14

Add: Non-operating income 17476.72 552207.24

Less: Non-operating expense 51480.63 45299.06

4. Profit before income tax (“-” for

-41238752.02201997231.32

losses)

Less: Income tax expense -2580629.05 59036968.69

5. Net profit for the year (“-” for

-38658122.97142960262.63

net losses)

5.1 Classification according to

operation continuity

5.1.1 Net profit from

continuing operations (“-” for net -38658122.97 142960262.63

loss)

5.1.2Net profit from

discontinued operations (“-” for net

loss)

5.2 Classification according to

attribute

5.2.1 Members of the parent

-37118182.81145128330.14

shareholders ("-" for net loss)

41ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

5.2.2 Non-controlling

-1539940.16-2168067.51

interests (“-” for net loss)

6. Other comprehensive income

-2683340.991148674.10

(net of tax)

Other comprehensive income

(net of tax) attributable to members -1772722.17 2356617.71

of the parent entity

6.1 Other comprehensive

income

352055.065175152.79

items that will not be reclassified

subsequently to profit or loss

6.1.1 Remeasurement of

defined benefit plan liability or

asset

6.1.2 Other comprehensive

income that cannot be transferred

to profit or loss under the equity 352055.06 5175152.79

method

6.1.3 Changes in the fair value

of investments in other equity

instruments

6.1.4 Changes in the fair

value of the company’s credit risks

6.1.5 Other

6.2 Other comprehensive

income items that may be

reclassified subsequently to profit -2124777.23 -2818535.08

or loss

6.2.1 Other comprehensive

income that can be transferred to

profit or loss under equity method

6.2.2 Changes in the fair value

of investments in other debt

obligations

6.2.3 Other comprehensive

income arising from the

reclassification of financial assets

6.2.4 Provision for credit

impairments in other debt

investment

6.2.5 Effective portion of

gains or losses arising from cash

flow hedging instruments

6.2.6 Translation differences

arising from translation of foreign -2124777.23 -2818535.08

currency financial statements

6.2.7 Other

Other comprehensive

income (net of tax) -910618.82 -1207943.61

attributable to non-

42ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

controlling interests

7. Total comprehensive income for

-41341463.96144108936.73

the period

Attributable to members of parent

-38890904.98147484947.85

entity

Attributable to non-controlling

-2450558.98-3376011.12

interests

8. Earnings per share

8.1 Basic earnings per share -0.0367 0.1435

8.2 Diluted earnings per share -0.0367 0.1435

In a business combination involving enterprises under common control (net losses)/net profit of combined

parties before the combination date is RMB 0.00 and (net losses)/net profit of combined parties in prior period

is RMB 0.00.Legal representative: Xiaoping Tang General Accountant：JianFei Wang The head of the accounting

department: Hongpu Zhou

4. Statement of Profit or Loss and Other Comprehensive Income For the Parent Entity

Presented in RMB

6 months ended 30 June 6 months ended 30 June

Item

20232022

1. Revenue 45811654.36 160994487.38

Less: Cost of sales 14351721.51 48054643.10

Taxes and surcharges 4234420.47 50213639.31

Selling and distribution expense 620765.04 1136952.69

General and administrative

12792471.1919684166.38

expenses

Research and development

expense

Financial expense -5557837.05 -8916021.09

Including: Interest expense

Interest income

Add: Other income 68844.09 234931.53

Investment income (“-” for

1806314.48174994652.49

losses)

Including: Income from

investment in associates and joint

ventures (“-” for losses)

Income from the derecognition

of financial assets at amortized

cost (“-” for loss)Net gain on exposure hedges (“-” for loss)

Gains from changes in fair value

3477115.564963730.62

(“-” for losses)

Credit impairment loss (“-” for

-448326.78-78105.19

loss)

Impairment losses (“-” for

losses)

Gains from assets disposal (“-”

43ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

for losses)

2. Operating profit (“-” for loss) 25170714.11 231092526.82

Add: Non-operating income 4745.37 550000.10

Less: Non-operating expense 50894.08 0.00

3. Profit before income tax (“-” for

25124565.40231642526.92

losses)

Less: Income tax expense -869186.92 56829680.07

4. Net profit for the year (“-” for

25993752.32174812846.85

net losses)

4.1 Net profit from continuing

25993752.32174812846.85

operations (“-” for net loss)

4.2 Net profit from discontinued

operations (“-” for net losses)

5. Other comprehensive income

352055.060.00

net of tax

5.1 Other comprehensive

income

352055.06

items that will not be reclassified

subsequently to profit or loss

5.1.1 Remeasurement of

defined benefit plan liability or

asset

5.1.2 Other comprehensive

income that cannot be transferred

to profit or loss under the equity

method

5.1.3 Changes in the fair

value of investments in other 352055.06 0.00

equity instruments

5.1.4 Changes in the fair value

of the company’s credit risks

5.1.5 Other

5.2 Other comprehensive

income items that may be

reclassified subsequently to profit

or loss

5.2.1 Other comprehensive

income can be transferred to profit

or loss under equity method

5.2.2 Changes in the fair value

of investments in other debt

obligations

5.2.3 Other comprehensive

income arising from the

reclassification of financial assets

5.2.4 Provision for credit

impairments in other debt

investment

5.2.5 Effective portion of

gains or losses arising from cash

flow hedging instruments

44ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

5.2.6 Translation differences

arising from translation of foreign

currency financial statements

5.2.7 Other

6. Total comprehensive income for

26345807.38174812846.85

the period

7. Earnings per share

7.1 Basic earnings per share

7.2 Diluted earnings per share

5. Consolidated Statement Of Cash Flows

Presented in RMB

Item 6 months ended 30 June 2023 6 months ended 30 June 2022

1. Cash flows from operating

activities:

Proceeds from sales of goods 164207230.02 229484917.15

Net increase deposits from

customers and placements from

corporations in the same industry

Net increase in loans from

central bank

Net increase in loans from other

financial institution

Cash premiums received on

original insurance contracts

Net proceeds from reinsurance

Net increase in deposits and

investment from insures

Interest handling charges and

commissions received

Net increase in fund deposits

Net increase in proceeds from

repurchase transactions

Net proceeds from acting trading

of securities

Refund of taxes 1186861.59 126578042.71

Proceeds from other operating

74221616.3274351558.97

activities

Sub-total of cash inflows 239615707.93 430414518.83

Payment for goods and services 60457437.30 195347145.81

Net increase in loans and

payments on behalf

Net increase in deposits in

central bank and interbank

Payments of claims for original

insurance contracts

Net increase in fund paid

Interest handling charges and

Interest

Commissions on issuance

policies paid

45ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Payment to and for employees 36762506.08 51050768.33

Payments of various taxes 193176702.79 543263187.50

Payment for other operating

141360009.80188868560.53

activities

Sub-total of cash outflows 431756655.97 978529662.17

Net cash flows from operating

-192140948.04-548115143.34

activities

2. Cash flows from investing

activities:

Proceeds from disposal of

investments

Investment returns received 1644822.69 813960.00

Net proceeds from disposal of

fixed assets intangible assets and 4269.60 2907.50

other long-term assets

Net proceeds from disposal of

subsidiaries and other business 139836766.74

units

Proceeds from other investing

136800000.00115000000.00

activities

Sub-total of cash inflows 138449092.29 255653634.24

Payment for acquisition of fixed

assets intangible assets and other 251357.46 126730.24

long-term assets

Payment for acquisition of

investments

Net increase in pledged loans

Net payment for acquisition of

subsidiaries and other business

units

Payment for other investing

activities

Sub-total of cash outflows 251357.46 126730.24

Net cash flows from investing

138197734.83255526904.00

activities

3. Cash flows from financing

activities:

Proceeds from investors

Including: Proceeds from non-

controlling shareholders of

subsidiaries

Proceeds from borrowings 101586610.82

Proceeds from other financing

activities

Sub-total of cash inflows 101586610.82

Repayments of borrowings

Payment for dividends profit

63399744.75

distributions or interest

Including: Dividends and profits

paid to non-controlling profits paid

to non-controlling shareholders of

subsidiaries

Payment for other financing

activities

Sub-total of cash outflows 63399744.75

Net cash flows from financing

38186866.07

activities

46ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

4. Effect of foreign exchange rate

changes on cash and cash 172392.24 250898.91

equivalents

5. Net increase in cash and cash

-15583954.90-292337340.43

equivalents

Add: Cash and cash equivalents

190365069.48612293635.15

as at the year beginning

6. Cash and cash equivalent as at

174781114.58319956294.72

the year end

6. Cash Flow Statement of the Company as the Parent

Presented in RMB

Item 6 months ended 30 June 2023 6 months ended 30 June 2022

1. Cash flows from operating

activities:

Proceeds from sales of goods 55240004.34 29085968.85

Refund of taxes 1143272.60 76602710.88

Proceeds from other operating

40177648.86187691251.29

activities

Sub-total of cash inflows 96560925.80 293379931.02

Payment for goods and services 2806232.29 11660146.24

Payment to and for employees 21711708.29 25700808.60

Payments of various taxes 132822106.11 490780774.26

Payment for other operating

51390420.5632302748.93

activities

Sub-total of cash outflows 208730467.25 560444478.03

Net cash flows from operating

-112169541.45-267064547.01

activities

2. Cash flows from investing

activities:

Proceeds from disposal of

investments

Investment returns received 6644822.69 813960.00

Net proceeds from disposal of

fixed assets intangible assets and 0.00 2907.50

other long-term assets

Net proceeds from disposal of

subsidiaries and other business 0.00 177009030.00

units

Proceeds from other investing

136800000.00206413737.42

activities

Sub-total of cash inflows 143444822.69 384239634.92

Payment for acquisition of

fixed assets intangible assets and 213690.10 78576.00

other long-term assets

Payment for acquisition of

investments

Net payment for acquisition

of subsidiaries and other business

units

Payment for other investing

14320000.00207513737.42

activities

Sub-total of cash outflows 14533690.10 207592313.42

Net cash flows from investing

128911132.59176647321.50

activities

47ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

3. Cash flows from financing

activities:

Proceeds from investors

Proceeds from borrowings 62586610.82 0.00

Proceeds from other financing

activities

Sub-total of cash inflows 62586610.82 0.00

Repayments of borrowings

Payment for dividends profit

61711260.000.00

distributions or interest

Payment for other financing

activities

Sub-total of cash outflows 61711260.00 0.00

Net cash flows from financing

875350.820.00

activities

4. Effect of foreign exchange rate

changes on cash and cash 0.00 0.00

equivalents

5. Net increase in cash and cash

17616941.96-90417225.51

equivalents

Add: Cash and cash

equivalents as at the year 90800999.60 297680168.50

beginning

6. Cash and cash equivalent as at

108417941.56207262942.99

the year end

7. Consolidated Statement Of Changes in Equity

Presented in RMB

6 months ended 30 June 2023

Attributable to shareholders’ equity of the parent company

Other equity Oth No

instruments er Ge

Les n-

co neri Ret

Cap s: Spe Sur con Tot

Item Sha mpr c ain

Pre Per ital trea cifi plu Sub trol al re ehe Ris ed Oth

fere pet rese sur c s tota ling equcap Oth nsi k ear er

nce ual rve y rese rese l inte ity ital er ve Res nin

sha bon s sha rve rve restinc erv gs

res d res s om e

10174042

97825275282

11130486

I. Balance 24 926 25 30

660155240541

at the end 49 72 37 12

00185477

of last year 10. 0.8 29. 29.

0.07.47.77.6

1152697

0807

Add:

Changes of

accounting

policies

Correction

of prior

period

48ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

errors

Business

combinatio

n involving

enterprises

under

common

control

Other

10174042

97825275282

II. Balance 11 13 04 86

249262530

at the 660 155 240 541

49723712

Beginning 00 18 54 77

10.0.829.29.

of the Year 0.0 7.4 7.7 7.6

1152697

0807

III.---

Changes in - -

98100103

equity 17 24

8296005

during the 72 50

442127year (“- 722 558

2.864.23.“for .17 .98

19896

decrease)

---

(I) Total 37 38 41

1724

comprehen 118 890 341

7250

sive 18 90 46

722558

income 2.8 4.9 3.9.17.98

186

(II)

Shareholde

r’s

contributio

ns and

decrease of

capital

1.Contribut

ion by

ordinary

shareholder

2. Holders

of other

equity

instruments

invested

capital

3. Equity

settled

share-

based

payments

4．Other

(III) - - -

Appropriati 61 61 61

on of 711 711 711

49ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

profits 26 26 26

0.00.00.0

000

1.Appropri

ation for 0.0 0.0

surplus 0 0

reserves

2.Appropri

ation for 0.0 0.0

general 0 0

reserves

---

3.Distributi 61 61 61

on to 711 711 711

shareholder 26 26 26

s 0.0 0.0 0.0

000

4．Other

(IV)Transf

er within

equity

1.Share

capital

increased

by capital

reserves

transfer

2.Share

capital

increased

by surplus

reserves

transfer

3.Transfer

of surplus

reserve to

offset

losses

Remeasure

ment of

defined

benefit

plan

liability

orasset

transfer to

retained

earnings

5. Other

comprehen

sive

income

carried

forward to

retained

earnings

50ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

0.0

6．Other

(V) Special

Reserve

1.Appropri

ation

during the

year

2.Utilizatio

n during

the year

(VI) Others

10163941

97824275279

IV. Balance 11 14 03 83

241532585

at the end 660 325 638 489

49993706

of the 00 74 38 05

10.8.629.70.

period 0.0 4.6 2.7 3.7

1182699

0721

Presented in RMB

6 months ended 30 June 2022

Attributable to shareholders’ equity of the parent company

Other equity Oth No

instruments er GeLes n-

co neri Ret

Cap s: Spe Sur con Tot

Item Sha mpr c ain

Pre Per ital trea cifi plu Sub trol al re ehe Ris ed Oth

fere pet rese sur c s tota ling equcap Oth nsi k ear er

nce ual rve y rese rese l inte ity ital er ve Res nin

sha bon s sha rve rve restinc erv gs

res d res s om e

10163942

97836241289

11713827

I. Balance 24 088 14 06

660121260329

at the end 49 96 48 88

00562916

of last year 10. 3.9 54. 77.

0.02.91.99.4

1159344

0871

Add:

Changes of

accounting

policies

Correction

of prior

period

errors

Business

combinatio

n involving

enterprises

under

common

control

51ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Other

10163942

97836241289

II. Balance 11 71 38 27

240881406

at the 660 121 260 329

49964888

Beginning 00 56 29 16

10.3.954.77.

of the Year 0.0 2.9 1.9 9.4

1159344

0871

III.Changes in - 67 58 - 55

equity 90 552 458 33 082

during the 93 02 86 76 85year (“- 155 3.4 7.8 011 6.7“for .55 0 5 .12 3decrease)

(I) Total 23

12483310

comprehen 56

83497689

sive 617

30.47.01136.

income .71

1485.1273

(II)

Shareholde

r’s

contributio

ns and

decrease of

capital

1.Contribut

ion by

ordinary

shareholder

2. Holders

of other

equity

instruments

invested

capital

3. Equity

settled

share-

based

payments

4．Other

---

(III) 89 89 89

Appropriati 026 026 026

on of 08 08 08

profits 0.0 0.0 0.0

000

1.Appropri

ation for

surplus

1.Appropri

ation for

general

reserves

3.Distributi - - -

52ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

on to 89 89 89

shareholder 026 026 026

s 08 08 08

0.00.00.0

000

4．Other

(IV)Transf 449

449

er within 77

equity 3.2

3.2

1.Share

capital

increased

by capital

reserves

transfer

2..Share

capital

increased

by surplus

reserves

transfer

3.Transfer

of surplus

reserve to

offset

losses

Remeasure

ment of

defined

benefit

plan

liability

orasset

transfer to

retained

earnings

5. Other

comprehen -

sive 11

449

income 449

carried 77

3.2

forward to 3.2

retained 6

earnings

6．Other

(V) Special

Reserve

Appropriati

on during

the year

2.Utilizatio

n during

53ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

the year

(VI) Others

10173942

97826241285

IV. Balance 11 38 96 82

249951469

at the end 660 673 719 412

49804828

of the 00 58 15 02

10.8.454.66.

period 0.0 6.3 9.8 6.1

1109332

0824

8. Consolidated Statement Of Changes in Equity Of The Parent Entity

Presented in RMB

6 months ended 30 June 2023

Other equity Other

Less:

instruments Capit comp Speci Surpl Retai

Item Share treas Total

capit Prefe Perpe

al rehen fic us ned

ury Other equit

al rence tual

reser sive reser reser earni

Other share y

share bond ves inco ve ve ngs s

s s me

101116923922

I. Balance 9647 1379 2521

660510386

at the end 1193 426. 2411

000.0832.8306.4

of last year 1.13 68 5.85

006

Add:

Changes of

accounting

policies

Correction

of prior

period

errors

Other

II. Balance 1011 1692 3922

964713792521

at the 660 510 386

1193426.2411

Beginning 000.0 832.8 306.4

1.13685.85

of the Year 0 0 6

III.Changes in

equity

352035713536

during the

55.0675075452year (“-.68.62“fordecrease)

(I) Total

25992634

comprehen 3520

37525807

sive 55.06.32.38

income

(II)

Shareholde

r’s

contributio

ns and

decrease of

54ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

capital

1.Contribut

ion by

ordinary

shareholder

2. Holders

of other

equity

instruments

invested

capital

3. Equity

settled

share-

based

payments

4．Other

(III) - -

Appropriati 6171 6171

on of 1260 1260

profits .00 .00

1.Appropri

ation for

surplus

2.Distributi - -

on to 6171 6171

shareholder 1260 1260

s .00 .00

3．Other

(IV)Transf

er within

equity

1.Share

capital

increased

by capital

reserves

transfer

2..Share

capital

increased

by surplus

reserves

transfer

3.Transfer

of surplus

reserve to

offset

losses

Remeasure

ment of

defined

benefit

plan

55ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

liability

orasset

transfer to

retained

earnings

5. Other

comprehen

sive

income

carried

forward to

retained

earnings

6．Other

(V) Special

Reserve

Appropriati

on during

the year

2.Utilizatio

n during

the year

(VI) Others

IV. Balance 1011 1656 3887

964717312521

at the end 660 793 020

1193481.2411

of the 000.0 325.1 853.8

1.13745.85

period 0 2 4

Presented in RMB

6 months ended 30 June 2022

Other equity Other

Less:

instruments Capit comp Speci Surpl Retai

Item Share treas Total Prefe Perpe al rehen fic us ned capit ury Other equit

rence tual reser sive reser reser earnial Other share y

share bond ves inco ve ve ngs s

s s me

101114743670

I. Balance 9647 1373 2180

660557318

at the end 1193 954. 1524

000.0043.8170.7

of last year 1.13 19 1.52

060

Add:

Changes of

accounting

policies

Correction

of prior

period

errors

Other

II. Balance 1011 9647 1373 2180 1474 3670

at the 660 1193 954. 1524 557 318

Beginning 000.0 1.13 19 1.52 043.8 170.7

56ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

of the Year 0 6 0

III.Changes in

equity 5945 8578 9173

during the 521. 6766 2288year (“- 73 .85 .58“fordecrease)

(I) Total

594517481807

comprehen

521.12845836

sive

736.858.58

income

(II)

Shareholde

r’s

contributio

ns and

decrease of

capital

1.Contribut

ion by

ordinary

shareholder

2. Holders

of other

equity

instruments

invested

capital

3. Equity

settled

share-

based

payments

4．Other

(III) - -

Appropriati 8902 8902

on of 6080 6080

profits .00 .00

1.Appropri

ation for

surplus

2.Distributi - -

on to 8902 8902

shareholder 6080 6080

s .00 .00

3．Other

(IV)Transf

er within

equity

1.Share

capital

increased

by capital

reserves

57ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

transfer

2..Share

capital

increased

by surplus

reserves

transfer

3.Transfer

of surplus

reserve to

offset

losses

Remeasure

ment of

defined

benefit

plan

liability

orasset

transfer to

retained

earnings

5. Other

comprehen

sive

income

carried

forward to

retained

earnings

6．Other

(V) Special

Reserve

Appropriati

on during

the year

2.Utilizatio

n during

the year

(VI) Others

IV. Balance 1011 1560 3762

964773192180

at the end 660 343 050

1193475.1524

of the 000.0 810.7 459.2

1.13921.52

period 0 1 8

III. Company information

1. Company’s profile

Shenzhen Special Economic Zone Real Estate and Properties (Group) Co. Ltd. (the “Group” or “the Company”)

was established in July 1993 as approved by the Shenzhen Municipal Government with document SFBF (1993)

724. The Company issued A shares on 15 September 1993 and issued B shares on 10 January 1994. On 31 August

1994 the issued B shares were listed in the New York Exchange market as class A recommendation. The total

58ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

share capital is 1011660000 shares including 891660000 of A shares and 120000000 of B shares. The

company business license registration number is 91440300192179585N and the registered capital is CNY

1011660000.00. The Company’s headquarter is located at Floor 45-48 Shen Fang Plaza Ren Min South Road

Luo Hu District Shen Zhen Guangdong province.On 13 October 2004 according to the document No. (2004) 223 “Decision on establishing Shenzhen investmentHolding Co. Ltd.” issued by State-Owned Assets Supervision and Administration Commission of Shenzhen

Municipal Government the former major shareholder – Shenzhen Construction Investment Holding Company

with two assets management companies merged and the Shenzhen Investment Holding Co. Ltd formed which

causes the Company's equity to change. By the State-owned Assets Supervision and Administration Commission

of the state council and quasi-exempt obligations tender offer as approved by China Security Regulatory

Committee with document No. (2005)116 this issue of consolidated has been authorized and the change in

registration had been completed on 15 February 2006. At the end of the reporting period Shenzhen Investment

Holding Limited holds 564353838 shares of the Company (55.78% of the total share capital). The shares are all

tradable unrestricted shares.The Company has established the corporate governance structure of the general meeting of shareholders the

board of directors and the board of supervisors. At present it has human resources financing plan department

marketing department engineering management department etc.The Company and its subsidiaries (hereinafter referred to as "the Group") are principally engaged in real estate

development and sales property leasing and management retail merchandising and trade hotel equipment

installation and maintenance construction interior decoration etc.

2. These financial statements and notes to the financial statements were approved by the 8th Board of

Directors of the Group at the 4th Board meeting dated on 25 August 2023.

3. The scope of consolidated statements

For details please refer to Note VIII “Changes in consolidation scope” and Note IX “Interests in other entities”.IV. The Basis of Preparation of Financial Statements

1. Basis of preparation

The financial statements are prepared in accordance with the Accounting Standards for Business Enterprises and

corresponding application guidance interpretations and other related provisions issued by the Ministry of Finance

(collectively " Accounting Standards for Business Enterprises "). In addition the Group also discloses relevant

financial information in accordance with the China Securities Regulatory Commission's "Information Disclosure

and Reporting Rules for Companies that Public Issued Securities" No. 15 - General Provisions on Financial

Reporting (revised in 2014).These financial statements are presented on going concern basis.The Group adopts the accrual basis of accounting. Except for certain financial instruments the financial

statements are prepared under the historical cost convention. In the event that impairment of assets occurs a

provision for impairment is made accordingly in accordance with the relevant regulations.

59ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

2．Going concern

These financial statements are presented on going concern basis.V. Significant accounting policies and accounting estimates

Reminders on specific accounting policies and accounting estimates:

The Company take its own operation and production characteristics into consideration to determine the revenue

recognition policy. Please refer to Note V.32 “Revenue” for specific accounting policy.

1. Statement of compliance with the Accounting Standards for Business Enterprises

The financial statements have been prepared in compliance with the Accounting Standards for Business

Enterprises to truly and completely present the Group’s and the Company’s financial position as at 30 June 2023

and the Group’s and the Company’s operating results and cash flows for the half-year ended 30 June 2023.

2. Accounting period

The accounting period of the Group is from 1 January to 31 December.

3. Operating cycle

The Group's operating cycle is 12 months.

4. Functional currency

The Group and domestic subsidiaries (including Hong Kong) use Chinese Yuan (“CNY”) as their functional

currency. Offshore subsidiaries Great Wall Real Estate Co. LTD determine American dollar as their functional

currency according to the primary economic environment where they operate. The financial statements of the

Group have been prepared in CNY.

5. Accounting treatments for business combinations involving enterprises under common control

and business combinations not involving enterprises under common control

(1) Business combinations involving enterprises under common control

For a business combination involving enterprises under common control the assets acquired and liabilities

assumed are measured based on their carrying amounts in the consolidated financial statements of the ultimate

controlling party at the combination date except for adjustments due to different accounting policies. The

difference between the carrying amount of the net assets acquired and the consideration paid for the

combination is adjusted against share premium in the capital reserve with any excess adjusted against retained

earnings.Business combination involving enterprises under common control through step by step multiple transactions.In individual financial statements the share of the net assets of the consolidated party in the book value of the

consolidated financial statements of the ultimate controlling party of the net assets of the consolidated party on

the consolidation date calculated by the shareholding ratio on the consolidation date shall be taken as the initial

investment cost of the investment; the difference between the initial investment cost and the sum of the book

60ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

value of the investment held before the merger plus the book value of the newly consideration paid shall be

adjusted for the capital reserve. If the capital reserve is insufficient to be written down the retained earnings

shall be adjusted.In the consolidated financial statement the assets and liabilities of the consolidated party shall be measured

according to the book value of the consolidated financial statement of the ultimate controlling party on the

merger date except for the adjustment due to different accounting policies; the balance between the book value

of the investment held before the merger and the book value of the newly consideration paid and the book value

of the net assets obtained during the merger shall be adjusted for capital reserves. If the capital reserves are

insufficient to be written down the retained earnings shall be adjusted. For long-term equity investment held by

the merging party prior to acquiring control of the merged party the relevant profit and loss other

comprehensive income and other changes in owners' equity which have been recognized by the merging party

from later of the date on which the original equity was acquired and the date on which the merging party and the

merged party are ultimately under the control of the same party to the merging date shall offset the beginning

retained earnings or profits and losses of the current period.

(2) Business combinations involving enterprises not under common control

For business combinations involving enterprises not under common control the consideration costs include

acquisition-date fair value of assets transferred liabilities incurred or assumed and equity securities issued by

the acquirer in exchange for control of the acquiree. At the acquisition date the acquired assets liabilities and

contingent liabilities of the acquiree are measured at their fair value. The acquiree’s identifiable asset liabilities

and contingent liabilities are recognised at their acquisition-date fair value.Where the combination cost exceeds the acquirer’s interest in the fair value of the acquiree’s identifiable net

assets the difference is recognised as goodwill and subsequently measured on the basis of its cost less

accumulated impairment provisions. Where the combination cost is less than the acquirer’s interest in the fair

value of the acquiree’s identifiable net assets the difference is recognised in profit or loss for the current period

after reassessment.Business combination involving enterprises not under common control through step by step multiple

transactions.In individual financial statements the sum of the book value of the equity investment held by the purchaser

before the purchase date and the cost of the newly added investment on the purchase date is taken as the initial

investment cost of the investment. If other comprehensive income of equity investment held before the purchase

date is recognized by using the equity method such other comprehensive income will not be treated on the

purchase date and the investment will be treated on the same basis as the direct disposal of relevant assets or

liabilities by the invested entity. The owners' equity recognized as a result of changes in owners' equity other

than net profit and loss other comprehensive income and profit distribution of the investee shall be transferred

to the current profit and loss during the disposal period at the time of disposal of the investment. If the equity

investment held before the purchase date is measured at fair value the accumulated change in fair value

originally recorded in other comprehensive income is transferred to the profit and loss of the current period

when it is calculated by the cost method.In the consolidated financial statement the consolidated cost is the sum of the consideration paid on the

purchase date and the fair value on the purchase date of the equity held by the Purchaser prior to the purchase

date. For the equity held by the Purchaser before the purchase date it shall be re-measured according to the fair

value of the equity on the purchase date and the difference between the fair value and the book value shall be

recorded into the current income; The equity held by the Purchaser before the purchase date involves other

comprehensive income and other changes in owners' equity turn into current income on the purchase date

except for other comprehensive income generated by changes in net liabilities or net assets of the remeasured

income plan of the investee.

(3) Transaction costs for business combination

61ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

The overhead for the business combination including the expenses for audit legal services valuation advisory

and other administrative expenses are recorded in profit or loss for the current period when incurred. The

transaction costs of equity or debt securities issued as the considerations of business combination are included

in the initial recognition amount of the equity or debt securities.

6. Consolidated financial statements

(1) Scope of consolidated financial statements

The scope of consolidated financial statements is based on control. Control exists when the Group has power

over the investee; exposure or rights to variable returns from its involvement with the investee and has the

ability to affect its returns through its power over the investee. A subsidiary is an entity that is controlled by the

Group (including enterprise a portion of an investee as a deemed separate component and structured entity

controlled by the enterprise).

(2) Basis of preparation of consolidated financial statements

The consolidated financial statements are prepared by the Group based on the financial statements of the Group

and its subsidiaries and other relevant information. When preparing consolidated financial statements the

accounting policies and accounting periods of the subsidiaries should be consistent with those established by the

Group and all significant intra-group balances and transactions are eliminated.Where a subsidiary or business was acquired during the reporting period through a business combination

involving enterprises under common control the financial statements of the subsidiary or business are included

in the consolidated financial statements as if the combination had occurred at the date that the ultimate

controlling party first obtained control.Where a subsidiary or business was acquired during the reporting period through a business combination

involving enterprises not under common control the identifiable assets and liabilities of the acquired

subsidiaries or business are included in the scope of consolidation from the date that control commences.The portion of a subsidiary’s equity that is not attributable to the parent is treated as non-controlling interests

and presented separately in the consolidated balance sheet within shareholders’ equity. The portion of net profit

or loss of subsidiaries for the period attributable to non-controlling interests is presented separately in the

consolidated income statement below the “net profit” line item. When the amount of loss for the current period

attributable to the non-controlling shareholders of a subsidiary exceeds the non-controlling shareholders’ share

of the opening owners’ equity of the subsidiary the excess is still allocated against the non-controlling interests.

(3) Changes in non-controlling interests

Where the Group acquires a non-controlling interest from a subsidiary’s non-controlling shareholders or

disposes of a portion of an interest in a subsidiary without a change in control the transaction is treated as

equity transaction and the book value of shareholder’s equity attributed to the Group and to the non-controlling

interest is adjusted to reflect the change in the Group’s interest in the subsidiaries. The difference between the

proportion interests of the subsidiary’s net assets being acquired or disposed and the amount of the

consideration paid or received is adjusted to the capital reserve in the consolidated balance sheet with any

excess adjusted to retained earnings.

62ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

(4) Disposal of subsidiaries

When the Group loses control over a subsidiary because of disposing part of equity investment or other reasons

the remaining part of the equity investment is re-measured at fair value at the date when the control is lost. A

gain or loss is recognised in the current period and is calculated by the aggregate of consideration received in

disposal and the fair value of remaining part of the equity investment deducting the share of net assets in

proportion to previous shareholding percentage in the former subsidiary since acquisition date and the goodwill.Other comprehensive income related to the former subsidiary is transferred to profit or loss when the control is

lost except for the comprehensive income arising from the movement of net liabilities or assets in the former

subsidiary’s re-measurement of defined benefit plan.

7. Joint arrangement classification and accounting treatment for joint operation

A joint arrangement is an arrangement of which two or more parties have joint control. The Group classifies

joint arrangements into joint operations and joint ventures.

(1) Joint operations

A joint operation is a joint arrangement whereby the joint operators have rights to the assets and obligations for

the liabilities relating to the arrangement.The Group recognizes the following items relating to its interest in a joint operation and account for them in

accordance with relevant accounting standards:

A. its solely-held assets and its share of any assets held jointly;

B. its solely-assumed liabilities and its share of any liabilities assumed jointly;

C. its revenue from the sale of its share of the output arising from the joint operation;

D. its share of the revenue from the sale of the output by the joint operation; and

E. its solely-incurred expenses and its share of any expenses incurred jointly.

(2) Joint ventures

A joint venture is a joint arrangement whereby the joint venturers have rights to the net assets of the

arrangement.The Group adopts equity method under long-term equity investment in accounting for its investment in joint

venture.

8. Cash and cash equivalents

Cash comprises cash in hand and deposits that can be readily withdrawn on demand. Cash equivalents include

short-term highly liquid investments that are readily convertible to known amounts of cash and are subject to

an insignificant risk of change in value.

63ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

9. Foreign currency transactions and translation of foreign currency financial statements

(1) Foreign currency transactions

Foreign currency transactions are translated to the functional currency of the Group at the spot exchange rates

on the dates of the transactions.Monetary items denominated in foreign currencies are translated to Renminbi at the spot exchange rate at the

balance sheet date. The resulting exchange differences between the spot exchange rate on balance sheet date and

the spot exchange rate on initial recognition or on the previous balance sheet date are recognised in profit or loss.Non-monetary items that are measured at historical cost in foreign currencies are translated to Renminbi using the

exchange rate at the transaction date. Non-monetary items that are measured at fair value in foreign currencies are

translated using the exchange rate at the date the fair value is determined. The resulting exchange differences are

recognised in profit or loss or other comprehensive income according to the nature of non-monetary items.

(2) Translation of foreign currency financial statements

When translating the foreign currency financial statements of overseas subsidiaries assets and liabilities of

foreign operation are translated to Renminbi at the spot exchange rate at the balance sheet date. Equity items

excluding “retained earnings” are translated to Renminbi at the spot exchange rates at the transaction dates.Income and expenses of foreign operation are translated to Renminbi at the spot exchange rates at the

transaction dates.Cash flow statement of foreign operation is translated to Renminbi at the spot exchange rates at the cash flow

occurrence dates. Effect of foreign exchange rate changes on cash and cash equivalents is presented separately

as “Effect of foreign exchange rate changes on cash and cash equivalents” in the cash flow statement.The resulting translation differences are recognised in other comprehensive income in shareholders’ equity of

balance sheet.The translation differences accumulated in shareholders’ equity with respect to a foreign operation are transferred

to profit or loss in the period when the foreign operation is disposed.

10. Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one enterprise and a financial liability

or an equity instrument of another enterprise.

(1) Recognition and derecognition of financial instruments

A financial asset or a financial liability is recognized when the Group becomes a party to the contractual

provisions of a financial instrument.If one of the following criteria is met a financial asset is derecognised:

* the contractual rights to the cash flows from the financial asset expire; or

64ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

* The financial asset was transferred and the transfer qualifies for derecognition in accordance with

criteria set out below in “Transfer of Financial Assets”.A financial liability (or part of it) is derecognized when its contractual obligation (or part of it) is discharged or

cancelled or expires. If the Group (as a debtor) makes an agreement with the creditor to replace the current

financial liability with assuming a new financial liability and contractual provisions are different in substance

the current financial liability is derecognized and a new financial liability is recognized.If the financial assets are traded regularly the financial assets are recognized and derecognized at the transaction

date.

(2) Classification and measurement of financial assets

The Group classifies financial assets as subsequently measured at amortized cost fair value through other

comprehensive income or fair value through profit or loss at initial recognition on the basis of both the entity’s

business model for managing the financial assets and the contractual cash flow characteristics of the financial

asset.Financial assets measured at amortized cost

The Group classifies the financial assets that meet the following conditions and are not designated as measured

at fair value through profit or loss as financial assets measured at amortized cost:

* The Group's business model of managing the financial assets is to collect contractual cash flows as the

target;

* The contractual terms of the financial asset give rise on specified dates to cash flows that are solely

payments of principal and interest on the principal amount outstanding.After the initial recognition the effective interest rate method is adopted to measure the amortized cost of such

financial assets. Gains or losses arising from financial assets that are measured at amortized cost and are not

part of any hedging relationship shall be recorded in the current profit or loss when the recognition is terminated

amortized according to the effective interest method or the impairment is recognized.Financial assets measured at fair value through other comprehensive income

The Group classifies the financial assets that simultaneously meet the following conditions and are not specified

as measured at fair value through profit or loss as financial assets measured at fair value through other

comprehensive income:

* The Group's business model of managing the financial asset aims at both collecting the contract cash

flow and selling the financial asset.* The contractual terms of the financial asset give rise on specified dates to cash flows that are solely

payments of principal and interest on the principal amount outstanding.After the initial recognition this type of financial assets are subsequently measured at fair value. The interest

impairment loss or gain and exchange loss or gain calculated using the effective interest rate method are

included in the current profit or loss while other gains or losses are included in other comprehensive income.When derecognized the accumulated gains or losses previously recorded in other comprehensive income shall

be transferred out from other comprehensive income and recorded in the current profit or loss.Financial assets measured at fair value through profit or loss

65ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

In addition to the above financial assets measured at amortized cost and measured at fair value through other

comprehensive income the Group classifies all other financial assets as financial assets measured at fair value

through profit or loss. At the time of initial recognition in order to eliminate or significantly reduce accounting

mismatches the Group irrevocably designates some financial assets that should have been measured at

amortized cost or measured at fair value through other comprehensive income as financial assets measured at

fair value through profit or loss.After the initial recognition this kind of financial asset is subsequently measured at its fair value and the gains

or losses (including interest and dividend income) generated are recorded into the current profit or loss unless

the financial asset is part of the hedging relationship.However for non-trading equity instrument investment the Group irrevocably designates it as a financial asset

measured at fair value through other comprehensive income at the time of initial recognition. The designation is

made on a single investment basis and the relevant investments meet the definition of an equity instrument from

issuer's perspective.After the initial recognition this kind of financial assets are subsequently measured at fair value. Satisfied

dividend income is included in the profit or loss other gains or losses and changes in fair value are included in

other comprehensive income. When derecognized the accumulated gains or losses previously recorded in other

comprehensive income are transferred out and recorded in retained earnings.The business model of managing financial assets refers to how the group manages financial assets to generate

cash flows. The business model determines whether the cash flow from the financial assets under management

of the Group is derived from the receipt of contractual cash flows the sale of financial assets or a combination

of both. The Group determines its business model for managing financial assets on the basis of objective facts

and the specific business objectives for the management of financial assets determined by key management

personnel.The Group assesses the contractual cash flow characteristics of financial assets to determine whether the

contractual cash flows generated by the relevant financial assets on specified dates are solely payments of

principal and interest on the principal amount outstanding. Principal refers to the fair value of financial assets at

initial recognition. Interest includes consideration for the time value of money the credit risk associated with

the amount of principal outstanding over a given period and other basic lending risks and costs as well as a

profit margin. In addition the Group assesses contractual terms that may cause a change in the time distribution

or amount of the contractual cash flows of financial assets to determine whether they meet the requirements of

the above contractual cash flow characteristics.Only when the Group changes the business model of managing financial assets all affected related financial

assets shall be reclassified on the first day of the first reporting period after the change of the business model

otherwise the financial assets shall not be reclassified after the initial recognition.Financial assets are measured at fair value at the time of initial recognition. For financial assets measured at fair

value through profit or loss relevant transaction costs are directly recorded into current profit or loss; for other

classes of financial assets the relevant transaction costs are included in the initial recognition amount. For

accounts receivable arising from the sale of products or provision of services which do not contain or do not

take into account the material financing component the Group is entitled to collect the consideration amount as

expected as the initial recognition amount.

(3) Classification and measurement of financial liabilities

At the time of initial recognition the financial liabilities of the Group are classified as: financial liabilities

measured at fair value through current profit or loss and financial liabilities measured at amortized cost. For

financial liabilities that are not classified as measured at fair value through profit or loss relevant transaction

costs are included in their initial recognized amounts.Financial liabilities measured at fair value through profit or loss

66ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Financial liabilities measured at fair value through profit or loss include trading financial liabilities and financial

liabilities designated at the time of initial recognition as measured at fair value through profit or loss. For such

financial liabilities the subsequent measurement shall be made according to the fair value and the gains or

losses caused by changes in the fair value as well as the dividends and interest expenses related to such financial

liabilities shall be recorded into current profit or loss.Financial liabilities measured at amortized cost

For other financial liabilities the effective interest rate method shall be adopted and the subsequent

measurement shall be made at the amortized cost and the gains or losses arising from derecognition or

amortization shall be recorded into current profit or loss.The distinction between financial liabilities and equity instruments

Financial liabilities refer to liabilities that meet one of the following conditions:

* A contractual obligation to deliver cash or other financial assets to other parties.* a contractual obligation to exchange financial assets or financial liabilities with another party under

potentially adverse conditions.* Non-derivative instrument contracts that will be settled with or available to the firm's own equity

instruments in the future under which the firm will deliver a variable number of its own equity instruments.* a derivative contract in which the firm's own equity instruments are to be settled or used in the future

except for a derivative contract in which a fixed number of its own equity instruments are to be exchanged for a

fixed amount of cash or other financial assets.An equity instrument is a contract that certifies ownership of the remaining interest in an enterprise's assets after

all liabilities have been deducted.If the Group cannot unconditionally avoid fulfilling a contractual obligation by delivering cash or other

financial assets such contractual obligation meets the definition of a financial liability.If a financial instrument is to be settled with or available to the Group's own equity instrument consideration

needs to be given to whether the Group's own equity instrument used to settle the instrument is to be used as a

substitute for cash or other financial assets or to give the holder of the instrument the remaining interest in the

Issuer's assets after deduction of all liabilities. If the former the instrument is a financial liability of the group; If

it is the latter the instrument is an equity instrument of the Group.

(4) Fair value of financial instruments

For the determination of fair value of financial assets and financial liabilities see Note V. 36.

(5) Impairment of financial assets

On the basis of expected credit losses the Group conducts impairment accounting treatment for the following

items and confirms the loss provision:

* Financial assets measured at amortized cost;

* Receivables and creditor's rights investments measured at fair value and accounted for in other

comprehensive income;

67ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

* Contract assets as defined in the Accounting Standards for Business Enterprises No. 14 - Revenue;

* Lease receivables;

Financial guarantee contract (measured at fair value and its changes included in the current profit and loss

except the financial asset transfer does not meet the conditions for termination of recognition or continues to

involve the transferred financial asset).Measurement of expected credit losses

The term "expected credit loss" refers to the weighted average of the credit loss of a financial instrument

weighted by the risk of default. Credit loss refers to the difference between all contractual cash flows receivable

under the contract and all cash flows expected to be collected by the Group discounted at the original effective

interest rate that is the present value of all cash shortages.The Group calculates the probabilistic weighted amount of the present value of the difference between the cash

flows receivable under the Contract and the cash flows expected to be received and recognizes the expected

credit loss taking into account reasonable and evidential information concerning past events current conditions

and Itemions of future economic conditions and weighting the risk of default.he Group measures the expected credit losses of financial instruments at different stages. If the credit risk of the

financial instrument has not increased significantly since the initial recognition the Group shall measure the

loss provision in accordance with the expected credit loss in the next 12 months in the first stage;If the credit

risk of a financial instrument has increased significantly since the initial recognition but no credit impairment

has occurred it is in the second stage and the Group measures the loss provision according to the expected

credit loss of the entire life period of the instrument; If credit impairment has occurred to a financial instrument

since its initial recognition it is in the third stage and the Group shall measure the loss provision according to

the expected credit loss of the entire life period of the instrument.For financial instruments with low credit risk at the balance sheet date the Group assumes that the credit risk

has not increased significantly since the initial recognition and measures the loss provision in accordance with

the expected credit loss for the next 12 months.The term "expected credit loss over the entire expected life of a financial instrument" refers to the expected

credit loss resulting from all possible events of default during the entire expected life of a financial instrument.The expected credit loss within the next 12 months refers to the expected credit loss caused by the default event

of the financial instrument that may occur within 12 months after the date of the balance sheet (or the expected

duration of the financial instrument if the expected duration of the financial instrument is less than 12 months)

and is part of the expected credit loss over the entire maturity period.When measuring expected credit losses the Group shall take into account the longest contract period (including

the option to renew the contract) for which the enterprise is exposed to credit risk.The Group calculates interest income on the basis of the book balance before impairment provisions and the

effective interest rate for financial instruments in stage I and stage II and with lower credit risk. For financial

instruments in the third stage the interest income is calculated on the basis of the amortized cost of the book

balance less the impairment provision and the effective interest rate.Notes receivable accounts receivable and contract assets

For notes receivable accounts receivable and contract assets regardless of whether there is a material financing

component the Group always measures its loss provision in accordance with the amount equivalent to the

expected credit loss within the whole duration period.

68ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

When a single financial asset cannot assess the information of expected credit loss at a reasonable cost the

Group divides the notes receivable and accounts receivable into portfolios according to the credit risk

characteristics calculates the expected credit loss on the basis of the portfolios and determines the portfolios

based on the following:

A. Notes receivable

* Notes receivable portfolio 1: banker acceptance notes

* Notes receivable portfolio 2: commercial acceptance notes

B. Receivables

* Accounts receivable portfolio 1: related parties receivable

* Accounts Receivable Portfolio 2: Receivable from property sales

* Accounts receivable portfolio 3: receivable from other customers

C. Contract assets

* Contract Portfolio 1: Product Sales

* Contract Portfolio 2: Works Construction

For the notes receivable and contract assets divided into portfolios the Group calculates the expected credit loss

through default risk exposure and the expected credit loss rate over the entire duration by referring to the

historical credit loss experience combining the current situation and the forecast of the future economic

situation.For the receivables divided into portfolios the Group refers to the historical credit loss experience and

combines the current situation with the forecast of the future economic situation to compile a comparison table

between the age of receivables/overdue days and the expected credit loss rate of the entire duration period to

calculate the expected credit loss.Other receivables

The Group divides other receivables into several portfolios according to the credit risk characteristics and

calculates the expected credit loss on the basis of the portfolio. The basis for determining the portfolio is as

follows:

* Other Receivables Portfolio 1: Receivables from government agencies

* Other Receivables Portfolio 2: Other receivables from employee’s petty cash

* Other receivables portfolio 3: Other receivables from the collecting and paying on behalf

* Other receivables portfolio 4: Other receivables from other customers

* Other receivables portfolio 5: Receivables from related parties

For other receivables divided into portfolios the Group calculates the expected credit loss by default risk

exposure and the expected credit loss rate over the next 12 months or the entire duration.

69ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Debt investment and Other debt investment

For debt investment and other debt investment the Group calculates the expected credit loss based on the

default risk exposure and the expected credit loss rate within the next 12 months or the entire duration according

to the nature of the investment and the various types of counterparties and risk exposures.An assessment of a significant increase in credit risk

By comparing the risk of default of financial instruments on the balance sheet date with the risk of default on

the initial recognition date the Group determines the relative change of default risk within the expected

duration of financial instruments so as to evaluate whether the credit risk of financial instruments has

significantly increased since the initial recognition.In determining whether credit risk has increased significantly since the initial recognition the Group considers

reasonable and informed information including forward-looking information that can be obtained without

unnecessary additional cost or effort. Information considered by the Group includes:

* The debtor fails to pay the principal and interest as due under the contract;

* A material deterioration if any of the external or internal credit rating of the financial instrument that

has occurred or is expected;

* A serious deterioration of the debtor's business results occurred or is expected;

* A change in the existing or anticipated technological market economic or legal environment which

will have a material adverse effect on the debtor's ability to repay the Group.* According to the nature of financial instruments the Group evaluates whether credit risk increases

significantly on the basis of individual financial instruments or a combination of financial instruments. When

assessing on the basis of a portfolio of financial instruments the Group may classify financial instruments based

on common credit risk characteristics such as overdue information and credit risk rating.If overdue for more than 30 days the Group determines that the credit risk of the financial instrument has

increased significantly.The Group believes that the financial assets are in default under the following circumstances:

* The Borrower is unlikely to pay its arrears to the Group in full and this assessment does not take into

account any recourse actions taken by the Group such as liquidating the collateral (if held); or

* Financial assets are more than 90 days overdue.A financial asset whose credit has been impaired

On the balance sheet date the Group evaluates whether credit impairment has occurred in financial assets

measured at amortized cost and debt investments measured at fair value and whose changes are included in

other comprehensive income. When one or more events which have an adverse effect on the expected future

cash flow of a financial asset occur the financial asset becomes a financial asset with credit impairment.Evidence of credit impairment of financial assets includes the following observable information:

* Major financial difficulties occur to the issuer or the debtor;

* A breach of contract by the debtor such as a default or late payment of interest or principal;

70ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

* The Group for economic or contractual considerations relating to the debtor's financial difficulties

gives concessions that the debtor would not have made under any other circumstances;

* The debtor is likely to go bankrupt or undergo other financial restructuring;

* The financial difficulties of the issuer or debtor result in the disappearance of an active market for the

financial asset.Presentation of expected credit loss provisions

In order to reflect the change of the credit risk of financial instruments since the initial recognition the Group

re-measures the expected credit loss on each balance sheet date and the increase or rolleback amount of the loss

provision thus formed shall be recorded into the current profit and loss as an impairment loss or profit. For a

financial asset measured at amortized cost the loss provision shall offset the carrying value of the financial

asset as stated in the balance sheet; For the debt investment measured at fair value and its changes included in

other comprehensive income the Group recognizes its loss provision in other comprehensive income and does

not deduct the book value of the financial asset.Written-off

If the Group no longer reasonably expects that the contractual cash flow of a financial asset can be recovered in

whole or in part the carrying balance of the financial asset shall be directly written down. Such writedowns

constitute termination recognition of the relevant financial assets. This usually occurs when the Group

determines that the debtor does not have assets or sources of income that generate sufficient cash flow to repay

the amount to be written down. However in accordance with the Group's procedures for recovering amounts

due the financial assets that have been written down may still be affected by the execution activities.If a financial asset that has been written down is recovered later it shall be carried back as an impairment loss

and recorded in the profit and loss of the current period.

(6) Transfer of financial assets

Transfer of financial assets is the transfer or delivery of financial assets to another party (the transferee) other

than the issuer of financial assets.A financial asset is derecognised if the Group transfers substantially all the risks and rewards of ownership of

the financial asset to the transferee. A financial asset is not derecognised if the Group retains substantially all the

risks and rewards of ownership of the financial asset to the transferee.The Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset

and the accounting treatment is shown as following: if the Group has forgone control over the financial asset

the financial assets is derecognized and new assets and liabilities are recognized. If the Group retains control

over the financial asset the financial asset is recognised to the extent of its continuing involvement in the

transferred financial asset and an associated liability is recognised.

(7) Offset of financial assets and financial liabilities

Where the Group has the legal right to set off the recognized financial asset and financial liability and is

currently able to enforce such legal right and the Group plans to settle the financial asset on a net basis or

simultaneously realize the financial asset and pay off the financial liability the financial asset and financial

liability shall be shown in the balance sheet with the offset amount. In addition financial assets and financial

liabilities shall be separately presented in the balance sheet and shall not be set off against each other.

71ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

11. Notes Receivable

Please refer to Notes V.10 Financial Instrument.

12. Accounts Receivable

Please refer to Notes V.10 Financial Instrument.

13. Accounts receivable financing

Please refer to Notes V.10 Financial Instrument.

14. Other receivables

Determination method and accounting treatment method of expected credit loss of other receivables

Please refer to Note V 10. financial instruments.

15. Inventories

(1) Classification

The Group's inventory is classified by real estate development and non-real estate development. Inventory is

mainly real estate development projects including development costs and development products. Development

cost include the development costs of development products to be developed and development products under

construction. Development products include completed development products and development products intended

for sell but temporarily leased. Non-real estate development projects include raw materials finished goods and

engineering construction.

(2) Measurement method of cost of inventories

The group’s inventories are measured at actual cost when acquired. The actual cost of developing a product

includes land transfer fee infrastructure expenditure construction and installation project expenditure borrowing

expenses incurred before the completion of the development project and other related expenses in the

development process.。When a product is developed and shipped the actual cost is determined by specificidentification method.Raw materials and finished goods are calculated using weighted average method.

(3) Basis for determining the net realisable value and method for provision for obsolete inventories

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of

completion and the estimated costs necessary to make the sale and relevant taxes. The net realisable value is

measured based on the verified evidences and considerations for the purpose of holding inventories and the

effect of post balance sheet events.

72ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Any excess of the cost over the net realisable value of inventories is recognised as a provision for obsolete

inventories and is recognised in profit or loss. The Group usually recognises provision for decline in value of

inventories by a single inventory item. If the factors caused the value of inventory previously written-down

have disappeared the provision for decline in value of inventories previously made is reversed.

(4) Inventory count system

The Group maintains a perpetual inventory system

(5) Amortization methods of low-value consumables and packaging materials

Low-value consumables are charged to profit or loss when they are used.

16. Contract assets

17. Contract costs

Contract costs include incremental costs incurred to obtain the contract and contract performance costs.Incremental costs incurred to obtain a contract are costs (such as sales commissions etc.) that the Group would

not have incurred without the contract. If the cost is expected to be recovered the Group will recognize it as an

asset as the contract acquisition cost. Other expenses incurred by the Group for the acquisition of contracts

other than the incremental costs expected to be recovered are recorded into the profit and loss of the current

period when incurred.If the cost incurred for the performance of the contract does not fall within the scope of accounting standards for

inventories and other enterprises and meets the following conditions at the same time the Group will recognize

it as an asset as the contract performance cost:

* The costs are directly related to a current or prospective contract and include direct labor direct materials

overhead (or similar) costs that are expressly borne by the customer and other costs incurred solely in

connection with the contract;

* This cost increases the Group's future resources for fulfilling its performance obligations;

* The cost is expected to be recovered.Assets with contract acquisition cost recognition and assets with contract performance cost recognition

(hereinafter referred to as "assets related to contract cost") shall be amortized on the same basis as income

recognition of goods or services related to such assets and shall be recorded into current profit and loss. If the

amortization period does not exceed one year it will be recorded in the current profit and loss at the time of

occurrence.When the book value of the assets related to the contract cost is higher than the difference between the

following two items the Group shall make provision for impairment of the excess part and recognize it as

impairment loss of the assets:

* the remaining consideration that the Group is expected to obtain as a result of the transfer of the goods or

services related to the asset;

* Estimate the costs to be incurred for the transfer of the relevant goods or services.

73ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

The contract performance cost recognized as an asset shall be shown in the "Inventory" item with an

amortization period of no more than one year or one normal operating cycle at the time of initial recognition

while the amortization period exceeding one year or one normal operating cycle at the time of initial recognition

shall be shown in the item of "Other Non-current Assets".The contract acquisition cost recognized as an asset shall be shown in the item of "Other Current Assets" with

an amortization period of less than one year or one normal operating cycle at the time of initial recognition and

shall be shown in the item of "Other Non-current Assets" with an amortization period of more than one year or

one normal operating cycle at the time of initial recognition.

18. Assets held for sale

(1) Classification and measurement of non-current assets or disposal groups held for sale

The Group classifies a non-current asset or disposal group as held for sale when the carrying amount of the non-

current asset or disposal group will be recovered through a sale transaction (including an exchange transaction

of non-monetary assets with commercial substance) rather than through continuing use.Above mentioned non-current assets do not include investment properties subsequently measured with the fair

value model biological assets measured at fair value less costs to sell assets arising from employee benefits

financial assets deferred tax assets and contractual rights under insurance contracts.The disposal group is a group of assets to be disposed of by sale or otherwise together as a whole in a single

transaction and liabilities directly associated with those assets that will be transferred in the transaction. In

certain circumstances disposal groups include goodwill acquired in a business combination.A non-current asset or disposal group is classified as held for sale when all the following criteria are met:

According to the customary practices of selling such asset or disposal group in similar transactions the non-

current asset or disposal group is available for immediate sale in its present condition; The sale is highly

probable to occur that is the Group has made a resolution on a sale plan and entered into a legally binding

purchase agreement with other parties. The sale is expected to be completed within one year. The Group that is

committed to a sale plan involving loss of control of a subsidiary classifies all the investment in that subsidiary

as held for sale in its separate financial statements and classifies all the assets and liabilities of that subsidiary

as held for sale in its consolidated financial statements when the classification criteria for held for sale are met

regardless of whether the Group retains a non-controlling interest in its former subsidiary after the sale.Non-current assets or disposal groups held for sale are initially and subsequently measured at the lower of

carrying amount and fair value less costs to sell. Any excess of the carrying amount over the fair value less costs

to sell is recognised as an impairment loss in profit or loss. The impairment loss recognised for a disposal group

firstly reduces the carrying amount of goodwill allocated to the disposal group and then reduces the carrying

amount of other non-current assets pro rata on the basis of the carrying amount of each non-current asset in the

disposal group.The Group recognises a gain for any subsequent increase in fair value less costs to sell of an asset but not in

excess of the cumulative impairment loss that has been recognised after classified as held for sale. The reduced

carrying amount of goodwill is not recovered.The Group does not depreciate (or amortise) a non-current asset while it is classified as held for sale or while it

is part of a disposal group classified as held for sale. Interest and other expenses attributable to the liabilities of

a disposal group classified as held for sale continue to be recognised. If an investment or a part of investment in

an associate or a joint venture is classified as held for sale equity method is not used for the part classified as

held for sale while equity method is used for the rest part (the part not classified as held for sale) continually.When the Group does not have material impact on an associate or a joint venture due to the sale transaction it

stops using equity method.

74ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

The Group measures a non-current asset that ceases to be classified as held for sale at the lower of:

* its carrying amount before the asset or disposal group was classified as held for sale adjusted for any

depreciation amortisation or impairment that would have been recognised had the asset or disposal group not

been classified as held for sale.* its recoverable amount.

(2) Discontinued operations

The Group classifies a component as a discontinued operation either upon disposal of the operation or when the

operation meets the criteria to be classified as held for sale if it is separately identifiable and satisfies one of the

following conditions:

* It represents a separate major line of business or a separate geographical area of operations;

* It is part of a single co-ordinated plan to dispose of a separate major line of business or a separate

geographical area of operations;

* It is a subsidiary acquired exclusively with a view to resale.

(3) Presentation

The Group presents a non-current asset classified as held for sale and the assets of a disposal group classified as

held for sale as ―Assets held for sale‖ in balance sheet. The liabilities of a disposal group classified as held for

sale is presented as ―Liabilities held for sale‖ in balance sheet.The Group presents profit or loss from discontinued operations separately from profit or loss from continuing

operations in income statement. Impairment loss and reversal amount and any disposal gain or loss of a non-

current asset or disposal group classified as held for sale that does not meet the definition of a discontinued

operation is included in profit or loss from continuing operations. Any gain or loss from continuing operation of

discontinued operations including impairment loss and reversal amount and disposal gain or loss is included in

profit or loss from discontinued operations.A disposal group which is planned to cease operation rather than for sale and meets the criteria of a part of

discontinued operation the Group presents it as discontinued operation from the date of cessation.Where an operation is classified as discontinued in the current period profit or loss from continuing operations

and profit or loss from discontinued operations are separately presented in the income statement for the current

period. If the Group ceases to classify a discontinued operation as held for sale the information previously

presented in discontinued operations is reclassified and included in income from continuing operations for all

periods presented.

19. Long-term equity investments

Long-term equity investments include equity investments in subsidiaries and equity investments in joint

ventures and associates. An associate is an enterprise over which the Group has significant influence.

(1) Determination of initial investment cost

The initial cost of a long-term equity investment acquired through a business combination involving enterprises

under common control is the Group’s share of the carrying amount of the subsidiary’s equity in the consolidated

financial statements of the ultimate controlling party at the combination date. For a long-term equity investment

75ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

obtained through a business combination not involving enterprises under common control the initial cost is the

combination cost.A long-term equity investment acquired other than through a business combination: A long-term equity

investment acquired other than through a business combination is initially recognised at the amount of cash paid

if the Group acquires the investment by cash or at the fair value of the equity securities issued if an investment

is acquired by issuing equity securities.

(2) Subsequent measurement and recognition of profit or loss

Long-term equity investments in subsidiaries are accounted for using the cost method. An investment in a joint

venture or an associate is accounted for using the equity method for subsequent measurement.For a long-term equity investment which is accounted for using the cost method Except for cash dividends or

profit distributions declared but not yet distributed that have been included in the price or consideration paid in

obtaining the investments the Group recognises its share of the cash dividends or profit distributions declared

by the investee as investment income for the current period.For a long-term equity investment which is accounted for using the equity method where the initial cost of a

long-term equity investment exceeds the Group’s interest in the fair value of the investee’s identifiable net

assets at the date of acquisition the investment is initially recognised at cost. Where the initial investment cost

is less than the Group’s interest in the fair value of the investee’s identifiable net assets at the date of acquisition

the investment is initially recognised at the investor’s share of the fair value of the investee’s identifiable net

assets and the difference is recognised in profit or loss.Under the equity method the Group recognises its share of the investee’s profit or loss and other comprehensive

income as investment income or losses and other comprehensive income respectively and adjusts the carrying

amount of the investment accordingly. Once the investee declares any cash dividends or profit distributions the

carrying amount of the investment is reduced by the amount attributable to the Group. Changes in the Group’s

share of the investee’s owners’ equity other than those arising from the investee’s net profit or loss other

comprehensive income or profit distribution (referred to as “other changes in owners’ equity”) is recognised

directly in the Group’s equity and the carrying amount of the investment is adjusted accordingly. In calculating

its share of the investee’s net profits or losses other comprehensive income and other changes in owners’ equity

the Group recognises investment income and other comprehensive income after making appropriate adjustments

to align the accounting policies or accounting periods with those of the Group based on the fair value of the

investee’s identifiable net assets at the date of acquisition.When the Group becomes capable of exercising joint control or significant influence (but not control) over an

investee due to additional investment or other reasons the Group uses the fair value of the previously-held

equity investment together with additional investment cost as the initial investment cost under the equity

method. The difference between the fair value and carrying amount of the previously-held equity investment

and the accumulated changes in fair value included in other comprehensive income shall be transferred to profit

or loss for the current period upon commencement of the equity method.When the Group can no longer exercise control over an investee due to partial disposal of the equity investment

or other reasons and the remaining equity after disposal can exercise joint control of or significant influence

over an investee the remaining equity is adjusted as using equity method from acquisition. When the remaining

equity can no longer exercise joint control of or significant influence over an investee the remaining equity

investment shall be accounted for using Accounting Standard for Business Enterprises No. 22-Recognition and

Measurement of Financial Instruments and the difference between the fair value and the carrying amount of the

remaining equity investment shall be charged to profit or loss for the current period at the date of loss of control.When the Group can no longer exercise control over an investee due to new capital injection by other investors

and the Group can exercise joint control of or significant influence over an investee the Group recognizes its

76ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

share of the investee’s new added net assets using new shareholding percentage. The difference between its new

share of the investee’s new added net assets and its decreased shareholding percentage of the original

investment is recognized in profit or loss. And the Group adjusts to the equity method using the new

shareholding percentage as if it uses the equity method since it obtains the investment.Unrealised profits and losses resulting from transactions between the Group and its associates or joint ventures

are eliminated to the extent of the Group’s interest in the associates or joint ventures. Unrealised losses resulting

from transactions between the Group and its associates or joint ventures are eliminated in the same way as

unrealised gains but only to the extent that there is no impairment.

(3) Criteria for determining the existence of joint control or significant influence over an investee

Joint control is the contractually agreed sharing of control of an arrangement which exists only when decisions

about the relevant activities require the unanimous consent of the parties sharing control. When assessing

whether the Group can exercise joint control over an investee the Group first considers whether no single

participant party is in a position to control the investee’s related activities unilaterally and then considers

whether strategic decisions relating to the investee’s related activities require the unanimous consent of all

participant parties that sharing of control. All the parties or a group of the parties control the arrangement

collectively when they must act together to direct the relevant activities. When more than one combination of

the parties can control an arrangement collectively joint control does not exist. A party that holds only

protective rights does not have joint control of the arrangement.Significant influence is the power to participate in the financial and operating policy decisions of an investee

but does not have control or joint control over those policies. When determining whether the Group can exercise

significant influence over an investee the effect of potential voting rights (for example warrants share options

and convertible bonds) held by the Group or other parties that are currently exercisable or convertible shall be

considered.When the Group directly or indirectly through subsidiaries owns 20% of the investee (including 20%) or more

but less than 50% of the voting shares it has significant influence over the investee unless there is clear

evidence to show that in this case the Group cannot participate in the production and business decisions of the

investee and cannot form a significant influence. When the Group owns less than 20% of the voting shares

generally it does not have significant influence over the investee unless there is clear evidence to show that in

this case the Group can participate in the production and business decisions of the investee so as to form a

significant influence.

(4) Method of impairment testing and impairment provision

For investments in subsidiaries associates and joint ventures refer to Note V. 26 for the Group’s method of

asset impairment.

23. Investment property

Investment properties are properties held either to earn rental income or for capital appreciation or for both. The

Group’s investment properties include leased houses leased buildings leased land use rights. In addition for a

vacant building held by the company for operating lease if the board of directors (or a similar institution)

makes a written resolution expressly indicating that it is used for operating lease and the intention of holding

does not change in the short term it is also considered as Investment property.Investment properties are initially measured at acquisition cost and depreciated or amortized using the same

policy as that for fixed assets or intangible assets.For the impairment of the investment properties accounted for using the cost model refer to Note V.26.

77ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

The balance of the disposal income from the sale transfer scrapping or damage of the investment real estate

after deducting its book value and relevant taxes and fees shall be recorded into the current profit and loss.

21. Fixed assets

(1) Recognition of fixed assets

Fixed assets represent the tangible assets held by the Group for use in production of goods use in supply of

services rental or for administrative purposes with useful lives over one accounting year.Fixed assets are only recognised when its related economic benefits are likely to flow to the Group and its cost

can be reliably measured.Fixed asset are initially measured at cost.Subsequent expenses related to fixed assets shall be recorded into cost of fixed assets when its related economic

benefits are likely to flow to the Group and its cost can be reliably measured; the cost of daily repairs to fixed

assets that do not meet the conditions for subsequent expenditures for capitalization of fixed assets at the time

of occurrence shall be recorded into the profit or loss of the current period or the cost of the related assets. For

the part that is replaced its carrying amount is derecognized

(2) Depreciation of fixed assets

Depreciation Estimated useful Residual value Depreciation

Class

Method life (years) rate % rate %

straight-line

Plant and buildings 30 5 3.17%

depreciation

Motor vehicles straight-line

6515.83%

depreciation

Electronic straight-line

equipment and 5 5 19.00%

depreciation

others

The cost of a fixed asset is depreciated using the straight-line method since the state of intended use unless the

fixed asset is classified as held for sale. Not considering impairment provision the estimated useful lives

residual value rates and depreciation rates of each class of fixed assets are as table above. For impaired fixed

assets cumulative amount of impairment provision is deducted in determining the depreciation rate.

(3) Other

For the impairment of the fixed assets please refer to Note V.26.Useful lives estimated residual values and depreciation methods are reviewed at least at each year-end. The

Group adjusts the useful lives of fixed assets if their expected useful lives are different with the original

estimates and adjusts the estimated net residual values if they are different from the original estimates.When a fixed asset is disposed of or when it is expected that no economic benefit will be generated through the

use or disposal the fixed asset shall be derecognised. Proceeds from the disposal of fixed assets sold

78ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

transferred scrapped or damaged net of their carrying amount and associated taxes shall be recorded in the

profit or loss for the current period.

21. Construction in progress

Construction in progress is recognized based on the actual construction cost including all expenditures incurred

for construction Items capitalised borrowing costs and any other costs directly attributable to bringing the asset

to working condition for its intended use.Construction in progress is transferred to fixed asset when it is ready for its intended use.For the impairment of construction in progress please refer to Note V.26

23. Borrowing costs

(1) Capitalisation criteria

Borrowing costs that are directly attributable to the acquisition construction or production of a qualifying asset

shall be capitalised as part of the cost of that asset. Other borrowing costs are expensed in profit or loss as

incurred. The capitalisation of borrowing costs shall commence only when the following criteria are met:

* capital expenditures have been incurred including expenditures that have resulted in payment of cash

transfer of other assets or the assumption of interest-bearing liabilities;

* borrowing costs have been incurred;

* the activities that are necessary to prepare the asset for its intended use or sale have commenced.

(2) Capitalisation period

The capitalisation of borrowing costs ceases when the asset under acquisition or construction becomes ready for

its intended use the borrowing costs incurred thereafter are recognised in profit or loss for the current period.Capitalisation of borrowing costs is suspended during periods in which the acquisition or construction of a fixed

asset is interrupted abnormally and the interruption lasts for more than 3 months until the acquisition or

construction is resumed.

(3) Capitalisation rate of borrowing costs and calculation basis of capitalised amount

For interest expense actually incurred on specific borrowings the eligible capitalised amount is the net amount

of the borrowing costs after deducting any investment income earned before some or all of the funds are used

for expenditures on the qualifying asset. To the extent that the Group borrows funds generally and uses them for

the purpose of obtaining a qualifying asset the Group shall determine the amount of borrowing costs eligible

for capitalisation by applying a capitalisation rate to the expenditures on that asset the capitalisation rate shall

be the weighted average of the borrowing costs applicable to the borrowings of the Group that are outstanding

during the period other than borrowings specifically for the purpose of obtaining a qualifying asset.

79ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

In the capitalisation period exchange differences of specific borrowings in foreign currency shall be capitalised;

exchange differences of general borrowings in foreign currency is recognised in profit or loss for the current

period.

24. Right-of-use assets

(1) Conditions for the confirmation of the right-of-use assets

The Group's right-of-use assets refer to the Group's right to use the leased assets during the lease term as the

lessee.On the beginning date of the lease period the right-of-use assets shall be initially measured at cost. The cost

includes: the initial measurement amount of the lease liability; For the amount of lease payment paid on or before

the commencement date of the lease term if there is a lease incentive the relevant amount of lease incentive

already enjoyed will be deducted; Initial direct expenses incurred by the Group as the lessee; The costs which the

Group as the Lessee expects to incur in dismantling and removing the Leased Assets restoring the premises on

which the Leased Assets are located or restoring the Leased Assets to the state agreed in the Lease Terms. The

Group as the lessee shall confirm and measure the costs of demolition and restoration in accordance with the

Accounting Standards for Business Enterprises No. 13 - Contingencies. Subsequent adjustments are made for any

remeasurement of lease liabilities.

(2) Depreciation method of the right-of-use assets

The Group uses the straight line method of depreciation. Where the Group as the lessee can reasonably

determine that it obtains the ownership of the leased assets upon expiration of the lease term depreciation shall be

accrued over the remaining service life of the leased assets. Where it is impossible to reasonably determine that

the ownership of the leased asset can be acquired at the expiration of the lease term depreciation shall be accrued

in the shorter period between the lease term and the remaining useful life of the leased asset.

(3) See Note V.26 for the impairment test method of the right-of-use assets and the provision for

impairment.

25. Intangible assets

(1) Valuation Useful life and Impairment

Intangible assets include software land use right and patent rights etc.Intangible assets are stated at actual cost upon acquisition and the useful economic lives are determined at the

point of acquisition. When the useful life is finite amortisation method shall reflect the pattern in which the

asset’s economic benefits are expected to be realised. If the pattern cannot be determined reliably the straight-

line method shall be used. An intangible asset with an indefinite useful life shall not be amortised.The Group shall review the useful life and amortisation method of an intangible asset with a finite useful life at

least at each year end. Changes of useful life and amortisation method shall be accounted for as a change in

accounting estimate.An intangible asset shall be derecognised in profit or loss when it is not expected to generate future economic

benefits.For the impairment of intangible assets please refer to Note V.26 Impairment of Assets.

80ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

26. Impairment of long-term assets

The impairment of long-term equity investments in subsidiaries associates and joint ventures investment

properties measured using a cost model fixed assets construction in progress productive biological assets

measured using a cost model intangible assets goodwill proven oil and gas mining rights and wells and related

facilities etc. (Excluding inventories investment property measured using a fair value model deferred tax assets

and financial assets) is determined as follows:

At each balance sheet date the Group determines whether there is any indication of impairment. If any

indication exists the recoverable amount of the asset is estimated. In addition the Group estimates the

recoverable amounts of goodwill intangible assets with indefinite useful lives and intangible assets not ready

for use at each year-end irrespective of whether there is any indication of impairment.The recoverable amount of an asset is the higher of its fair value less costs to sell and its present value of

expected future cash flows. The recoverable amount is estimated for each individual asset. If it is not possible to

estimate the recoverable amount of each individual asset the Group determines the recoverable amount for the

asset group to which the asset belongs. An asset group is the smallest identifiable group of assets that generates

cash inflows that are largely independent of the cash inflows from other assets or asset groups.An impairment loss is recognised in profit or loss when the recoverable amount of an asset is less than its carrying

amount. A provision for impairment of the asset is recognised accordingly.For goodwill impairment test the carrying amount of goodwill arising from a business combination is allocated

reasonably to the relevant asset group since the acquisition date. If the carrying amount of goodwill is unable to

be allocated to asset group the carrying amount of goodwill will be allocated to asset portfolio. Asset group or

portfolio of asset group is asset group or portfolio of asset group which can be benefit from synergies of a

business combination and is not greater than the reportable segment of the Group.In impairment testing if impairment indication exists in asset group or portfolio of asset group containing

allocated goodwill impairment test is first conducted for asset group or portfolio of asset group that does not

contain goodwill and corresponding recoverable amount is estimated and any impairment loss is recognized.Then impairment test is conducted for asset group or portfolio of asset group containing goodwill by comparing

its carrying amount and its recoverable amount. If the recoverable amount is less than the carrying amount

impairment loss of goodwill is recognized.Once an impairment loss is recognised it is not reversed in a subsequent period.

27. Long-term deferred expenses

Long-term deferred expenses are recorded at the actual cost and amortized using a straight-line method within

the benefit period. For long-term deferred expense that cannot bring benefit in future period the Group

recognized its amortised cost in profit or loss for the current period.

28. Contract liabilities

Contract liabilities refer to the obligations of the company and its subsidiaries to transfer goods or services to

customers for consideration received or receivable from customers. Contract assets and contract liabilities under

the same contract are presented on a net basis.

81ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

29. Employee benefits

(1) Scope of employee benefits

Employee benefits refer to all forms of consideration or compensation given by the Group in exchange for

service rendered by employees or for the termination of employment relationship. Employee benefits include

short-term employee benefits post-employment benefits termination benefits and other long-term employee

benefits. Benefits provided to the Group’s spouse children dependents family members of deceased

employees or other beneficiaries are also part of the employee benefits.According to liquidity employee benefits are presented as “employee benefits payable” and “long-termemployee benefits payable” on the balance sheet.In the current period the Group has accrued for the actual wages bonuses medical insurance for employees

based on standard rate work injury insurance and maternity insurance and other social insurance and housing

fund incurred and these are recognised as liabilities and corresponding costs in the profit or loss.

(2) Post-employment benefits

Post-employment benefit plan includes defined contribution plans and defined benefit plans. Defined

contribution plans are post-employment benefit plans under which an enterprise pays fixed contributions into a

separate fund and will have no future obligations to pay the contributions. Defined benefit plans are post-

employment benefit plans other than defined contribution plans.Defined contribution plans

Defined contribution plans include primary endowment insurance unemployment insurance and corporate

pension plan etc.Besides basic pension insurance the Group establishes corporate pension plans in accordance with the related

policies of corporate pension regulations. Employees can join the pension plan voluntarily. The Group has no

other significant commitment of employees’ social security.The Group shall recognise in the accounting period in which an employee provides service the contribution

payable to a defined contribution plan as a liability with a corresponding charge to the profit or loss for the

current period or the cost of a relevant asset.Defined benefit plans

For a defined benefit plan an actuarial valuation is performed by an independent actuary at the annual balance

sheet date to determine the cost of providing benefits using the expected accrued benefit unit method. The

employee compensation cost caused by the benefit plan of the Group includes the following components:

* Service cost including current service cost past service cost and settlement profit or loss. Including the

current service cost refers to the increase in the present value of the defined benefit plan obligation caused by

the current provision of services by employees; The past service cost refers to the increase or decrease in the

present value of the defined benefit plan obligations related to the employee services of the previous period as a

result of the modification of the defined benefit plan.* Set the net interest on the net liabilities or net assets of the benefit plan including the interest income on

the plan assets the interest expense on the defined benefit plan obligations and the interest on the impact of the

asset cap.* The changes caused by the remeasurement of the net liabilities or net assets of the benefit plan.Unless other accounting standards require or allow the cost of employee benefits to be included in the cost of

assets the Group will include items * and * above in the current profit and loss; Item * is included in

other comprehensive income and will not be turned back to profit and loss in subsequent accounting periods.

82ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

When the originally defined benefit plan is terminated the part originally included in other comprehensive

income within the scope of equity is carried forward to undistributed profit.

(3) Termination benefits

The Group provides for termination benefits to the employees and shall recognise an employee benefits liability

for termination benefits with a corresponding charge to the profit or loss for the current period at the earlier of

the following dates: When the Group cannot unilaterally withdraw the offer of the termination benefits because

of an employment termination plan or a redundancy proposal; or when the Group recognises the costs or

expenses relating to a restructuring that involves the payment of the termination benefits.For employees who implement the internal retirement plan the economic compensation before the official

retirement date belongs to dismiss welfare. During the normal retirement date when the employees stop

providing services the salary and social insurance premium to be paid by the employees who retire within the

Group shall be included in the profit and loss of the current period in a lump sum. Economic compensation after

the official retirement date (such as the normal pension) shall be treated as after-service benefits.

(4) Other long-term employee benefits

Other long-term employee benefits provided by the Group to the employees satisfied the conditions for

classifying as a defined contribution plan; those benefits shall be accounted for in accordance with the above

requirements relating to defined contribution plan. When the benefits satisfied a defined benefit plan it shall be

accounted for in accordance with the above requirements relating to defined benefit plan but the movement of

net liabilities or assets in re-measurement of defined defined benefit plan shall be recorded in profit or loss for

the current period or cost of relevant assets.

30. Lease liabilities

Except for short-term leases and leases of low-value assets the Group initially measures lease liabilities at the

inception date of the lease term at the present value of unpaid lease payments on that date. The Group uses the

interest rate implicit in the lease as the discount rate to calculate the present value of the lease payments. If the

interest rate implicit in the lease cannot be determined the incremental borrowing rate will be used as the

discount rate.Lease payments refer to the payments made by the Group to the lessor in relation to the right to use the leased

asset during the lease term including: fixed payments and substantive fixed payments and if there is a lease

incentive deduct the amount related to the lease incentive; Variable lease payments that depend on an index or

rate; The exercise price of a call option that the Group is reasonably certain to exercise; If the lease term

reflects that the Group will exercise the option to terminate the lease the amount to be paid for exercising the

option to terminate the lease; The estimated payables based on the residual value of guarantees provided by the

Group.Variable lease payments that depend on an index or rate are initially measured based on the index or rate at the

commencement date of the lease term. Variable lease payments that are not included in the measurement of

lease liabilities will be included in the current profit and loss when they are actually incurred. After the

commencement date of the lease term the Group calculates the interest expense of the lease liability in each

period of the lease term at a fixed periodic interest rate and includes it in the current profit and loss or the cost

of related assets.After the commencement date of the lease term the Group will re-measure the lease liabilities and adjust the

corresponding right-of-use assets under the following circumstances. If the book value of the right-of-use assets

has been reduced to zero and the lease liabilities still need to be further reduced the difference will be included

83ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

in the current profit and loss. If the lease term changes or the evaluation result of the purchase option changes

the Group will remeasure the lease liability at the present value calculated by changed lease payments and the

revised discount rate; If the payable amount of the guaranteed residual value or the index or ratio used to

determine lease payments changes the Group will remeasure the lease liability based on the present value

calculated by revised lease payments and original discount rate. If changes in floating interest rates result in

changes in lease payments the Group will recalculate the lease liability using the revised discount rate.

31. Provisions

A provision is recognised for an obligation related to a contingency if all the following conditions are satisfied:

(1) the Group has a present obligation;

(2) it is probable that an outflow of economic benefits will be required to settle the obligation; and

(3) the amount of the obligation can be estimated reliably.

A provision is initially measured at the best estimate of the expenditure required to settle the related present

obligation. Factors pertaining to a contingency such as the risks uncertainties and time value of money are

taken into account as a whole in reaching the best estimate.Where the effect of the time value of money is

material provisions are determined by discounting the expected future cash flows. The Group reviews the

carrying amount of a provision at the balance sheet date and adjusts the carrying amount to the current best

estimate.If all or part of the expenditure necessary for settling the provision is expected to be compensated by a third

party the amount of compensation is separately recognized as an asset when it is basically certain to be received.The recognized compensation amount shall not exceed the carrying amount of the provision.

32. Revenue

(1) General principles

The Group has fulfilled its contractual obligation to recognize revenue when the customer acquires control of

the relevant goods or services.If the contract contains two or more performance obligations the Group shall on the commencement date of

the contract allocate the transaction price to each single performance obligation according to the relative

proportion of the individual selling price of the commodity or service committed by each single performance

obligation and measure the income according to the transaction price allocated to each single performance

obligation.If one of the following conditions is satisfied the Group shall perform its obligations within a certain period of

time; otherwise it belongs to the performance obligation at a certain point:

* The Client obtains and consumes the economic benefits brought by the Group's performance at the same

time of the Group's performance.* The customer can control the goods under construction during the performance of the Group.* The commodities produced by the Group during the performance of the Contract have irreplaceable

purposes and the Group has the right to collect payment for the accumulated part of the performance completed

so far during the whole period of the Contract.

84ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

For the performance obligations performed within a certain period of time the Group shall recognize the

income in accordance with the performance progress within that period.If the performance progress cannot be

reasonably determined and the Group is expected to be compensated for the costs already incurred the revenue

shall be recognized according to the amount of the costs already incurred until the performance progress can be

reasonably determined.For performance obligations performed at a certain point the Group recognizes revenue at the point when the

customer acquires control of the relevant goods or services.In determining whether a customer has acquired

control of goods or services the Group will take into account the following indications:

* The Group has a current right to receive payment for the goods or services that is the Customer has a

current obligation to pay for the goods.* The Group has transferred the legal ownership of the commodity to the customer that is the customer has

the legal ownership of the commodity.* The Group has transferred the goods in kind to the customer that is the customer has physical possession of

the goods.* The Group has transferred the main risks and rewards on the ownership of the commodity to the customer

that is the customer has acquired the main risks and rewards on the ownership of the commodity.* The customer has accepted the goods or services.* Other indications that the customer has acquired control of the product.The Group's right to receive consideration for goods or services transferred to a customer (and this right

depends on other factors other than the passage of time) is a contract asset which is subject to impairment on the

basis of expected credit losses. The Group's right unconditional (depending only on the passage of time) to

collect consideration from customers is shown as a receivable. The Group's obligation to transfer goods or

services to customers for which it has received or receivable consideration is a contractual liability.The contract assets and contract liabilities under the same contract shall be presented on a net basis. If the net

amount is the debit balance it shall be presented under the item of "Contract Assets" or "Other Non-current

Assets" according to its liquidity; If the net amount is a credit balance it shall be shown under the item

"Contract Liabilities" or "Other Non-current Liabilities" according to its liquidity.

(2) Specific methods

The specific methods of the Group's revenue recognition are as follows:

* The method for recognizing revenue from property sales

(1) the sale contract has been signed and filed with housing construction bureau; (2) the property development is

completed and pass the acceptance; (3) For Lump-sum payment revenue is recognized by the group when the

consideration is fully received. For instalment payment revenue is recognized when the first installment has been

received and the bank mortgage approval procedures have been completed. (4) completed the procedures for

entering the partnership in accordance with the requirements stipulated in sale contract.* The method for recognizing revenue from property services provided

85ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

According to property service contract agreed service period area served and unit price revenue is recognized

evenly within agreed service period.* The method for recognizing revenue from construction activities

As the customer can control the goods under construction during the performance of the Group the group shall

recognize the income in accordance with the performance progress within a certain period of time (except for

performance progress cannot be reasonably determined). The group shall determine the performance progress

based on cost incurred. If the performance progress cannot be reasonably determined and the Group is expected to

be compensated for the costs already incurred the revenue shall be recognized according to the amount of the

costs already incurred until the performance progress can be reasonably determined. If the contract costs cannot

be recovered the cost should be recognized immediately in current period when incurred. When the estimated

total cost of the contract is likely to exceed the total revenue of the contract the cost of the main business and the

estimated liabilities shall be recognized in accordance with the unexecuted loss contract. The loss shall be

recognized as current cost and put into provisions.* The method for recognizing revenue from other income

Revenue from other income include income from hotel operations etc. Rooms revenue from hotel operations shall

be recognized in accordance with the performance progress within agreed period as the client obtains and

consumes the economic benefits brought by the Group’s performance and the group’s performance obligations has

performed at a certain period of time. For other income the group recognizes revenue at the point when the

customer acquires control of the relevant goods or services which indicate the group has a right to receive

payment for services or goods provided in accordance with the relevant contract.Differences in revenue recognition accounting policies for similar businesses due to different business models

33. Government grants

A government grant is recognised when there is reasonable assurance that the grant will be received and that the

Group will comply with the conditions attaching to the grant.If a government grant is in the form of a transfer of a monetary asset it is measured at the amount received or

receivable. If a government grant is in the form of a transfer of a non-monetary asset it is measured at fair value.If fair value cannot be reliably determined it is measured at a nominal amount of CNY 1.Government grants related to assets are grants whose primary condition is that the Group qualifying for them

should purchase construct or otherwise acquire long-term assets. Government grants related to income are

grants other than those related to assets.For government grants with unspecified purpose the amount of grants used to form a long-term asset is

regarded as government grants related to an asset the remaining amount of grants is regarded as government

grants related to income. If it is not possible to distinguish the amount of grants is treated as government grants

related to income.A government grant related to an asset is offset against the carrying amount of the related asset or.recognised as

deferred income and amortised to profit or loss over the useful life of the related asset on a reasonable and

systematic manner. A grant that compensates the Group for expenses or losses already incurred is recognised in

profit or loss or offset against related expenses directly. A grant that compensates the Group for expenses or

86ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

losses to be incurred in the future is recognised as deferred income and included in profit or loss or offset

against related expenses in the periods in which the expenses or losses are recognised. The Group applies a

consistent approach to same or similar government grant transactions.A grant related to ordinary activities is recognised as other income or offset against related expenses based on

the economic substance. A grant not related to ordinary activities is recognised as non-operating income.When a recognised government grant is reversed carrying amount of the related asset is adjusted if the grant

was initially recognized as offset against the carrying amount of the related asset. If there is balance of relevant

deferred income it is offset against the carrying amount of relevant deferred income. Any excess of the reversal

to the carrying amount of deferred income is recognised in profit or loss for the current period. For other

circumstances reversal is directly recognized in profit or loss for the current period.

34. Deferred tax assets and Deferred tax liabilities

Income tax comprises of current tax and deferred tax. Current tax and deferred tax are recognised in profit or

loss except to the extent that they relate to transactions or items recognised directly in equity and goodwill

arising from a business combination.Deferred tax assets and deferred tax liabilities arise from deductible and taxable temporary differences

respectively being the differences between the carrying amounts of assets and liabilities for financial reporting

purposes and their tax bases.All the taxable temporary differences are recognized as deferred tax liabilities except for those incurred in the

following transactions:

(1) initial recognition of goodwill or assets or liabilities in a transaction that is not a business combination and

that affects neither accounting profit nor taxable profit (or deductible loss);

(2) taxable temporary differences associated with investments in subsidiaries associates and joint ventures

and the Group is able to control the timing of the reversal of the temporary difference and it is probable that the

temporary difference will not reverse in the foreseeable future.The Group recognises a deferred tax asset for deductible temporary differences deductible losses and tax

credits carried forward to subsequent periods to the extent that it is probable that future taxable profits will be

available against which deductible temporary differences deductible losses and tax credits can be utilised

except for those incurred in the following transactions:

(1) a transaction that is not a business combination and that affects neither accounting profit nor taxable profit

(or deductible loss);

(2) deductible temporary differences associated with investments in subsidiaries associates and joint ventures

the corresponding deferred tax asset is recognized when both of the following conditions are satisfied: it is

probable that the temporary difference will reverse in the foreseeable future; and it is probable that taxable

profits will be available in the future against which the temporary difference can be utilized.At the balance sheet date deferred tax is measured based on the tax consequences that would follow from the

expected manner of recovery or settlement of the carrying amount of the assets and liabilities using tax rates

87ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

enacted at the reporting date that are expected to be applied in the period when the asset is recovered or the

liability is settled.The carrying amount of a deferred tax asset is reviewed at each balance sheet date and is reduced to the extent

that it is no longer probable that the related tax benefits will be utilised. Such reduction is reversed to the extent

that it becomes probable that sufficient taxable profits will be available.

35. Leases

(1) Identification of leases

On the commencement date of the contract the Group as lessee or lessor assesses whether the customer under

the contract is entitled to receive almost all the economic benefits arising from the use of the identified assets

during the use period and to direct the use of the identified assets during the use period.The Group considers the

contract to be a lease or an inclusive lease if one of the parties to the contract relinquishes control over the use of

one or more identified assets for a certain period of time in exchange for consideration.

(2) The Group acts as the lessee

On the commencement date of the lease the Group recognizes the right-of-use assets and lease liabilities for all

leases except for simplified short-term leases and leases of low value assets.For the accounting policy of the Right-of-use assets see Note V.24. For the accounting policy of lease liabilities

please refer to Note V. 30.Lease liabilities are initially measured at the present value of the outstanding lease payments at the

commencement date of the lease at the embedded interest rate on the lease. The rental payment amount includes:

fixed payment amount and substantial fixed payment amount. If there is lease incentive amount the relevant

amount of lease incentive amount will be deducted. Variable lease payments depending on an index or ratio;

The exercise price of the Option provided that the Lessee is reasonably certain that the Option will be exercised;

The amount to be paid to exercise the option to terminate the lease if the lease term reflects that the lessee will

exercise the option to terminate the lease; And the amount expected to be payable based on the residual value of

the security provided by the Lessee. The interest expense of the lease liability in each period of the lease term

shall be calculated in accordance with the fixed periodic interest rate and recorded into the profit and loss of the

current period. The variable lease payment not included in the measurement of lease liabilities shall be recorded

into the current profit and loss when actually incurred.Short term lease

Short-term tenancy is a tenancy for a period of not more than 12 months at the commencement date of the tenancy

except for tenancies that include a purchase option.The Group will record the lease payment amount of short-term lease into the cost of relevant assets or current

profit and loss in each period of the lease term according to the straight-line method [or other systemically

reasonable method].For short-term lease the Group chooses to adopt the above simplified treatment method for the items that meet

the short-term lease conditions in the following asset types according to the categories of leased assets.Low value asset leasing

88ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Leasing of low-value assets refers to the leasing of a single leased asset whose value is less than CNY 100000.00

when it is a brand-new asset.The Group will include the lease payment of the low-value asset lease into the cost of the relevant asset or current

profit and loss in each period of the lease term according to the straight-line method.For low-value asset leases the Group chooses to adopt the above simplified treatment method according to the

specific situation of each lease.Change of lease

If the lease is changed and the following conditions are met at the same time the group accounts for the change as

a separate lease: 1 the change extends the scope of the lease by adding the right to use one or more leased assets; 2

the increased consideration is equivalent to the amount of the individual price of the extended portion of the lease

adjusted in accordance with the circumstances of the contract.If the lease change is not accounted for as a separate lease on the effective date of the lease change the company

redistributes the consideration of the contract after the change and redetermines the lease term the lease liability is

recalculated at the present value of the changed lease payment and the revised discount rate.If the lease scope is reduced or the lease period is shortened as a result of the lease change the company shall

adjust the book value of the right-to-use assets accordingly and record the relevant gains or losses related to the

partial or complete termination of the lease in the current profit and loss.If other lease changes result in lease liabilities being re-measured the company shall adjust the book value of the

right-to-use assets accordingly.

(3) The Group acts as the lessor

When the Group acts as the lessor the leases that substantially transfer all the risks and rewards related to the

ownership of the assets are recognized as financial leases and other leases other than financial leases are

recognized as operating leases.Finance lease

In the case of financial leasing the Group takes the net lease investment as the book value of the receivable

finance lease funds at the beginning of the lease period and the net lease investment is the sum of the

unguaranteed residual value and the present value of the unreceived lease income at the beginning of the lease

period discounted at the embodied interest rate.The Group as the lessor calculates and recognizes interest income

for each period of the lease term at a fixed periodic rate.The variable lease payment obtained by the Group as the

lessor and not included in the measurement of the net lease investment shall be recorded into the current profit and

loss when actually incurred.The termination recognition and impairment of financial lease receivable shall be accounted for in accordance

with the provisions of the Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement

of Financial Instruments and the Accounting Standards for Business Enterprises No. 23 - Transfer of Financial

Assets.Operating lease

For the rent in the operating lease the Group shall recognize the profits and losses of the current period in

accordance with the straight-line method during each period of the lease term. The initial direct expenses incurred

in connection with the operating lease shall be capitalized allocated on the same basis as the recognition of rental

income during the lease term and recorded into the current profit and loss in installments. The variable lease

89ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

payments obtained in connection with the operating lease and not included in the lease receipts shall be recorded

into the current profit and loss when actually incurred.Change of Lease

If there is a change in the operating lease the group shall as of the effective date of the change treat it as a new

lease the amount received in advance or in respect of the lease receivable relating to the lease prior to the change

shall be deemed to be the amount received for the new lease.If the financial lease is changed and the following conditions are met at the same time the group accounts for the

change as a separate lease: 1 the change extends the scope of the lease by adding the right to use one or more

leased assets; 2 the increased consideration is equivalent to the amount of the individual price of the extended

portion of the lease adjusted in accordance with the circumstances of the contract.Where a change in a financial lease is not accounted for as a separate lease the group shall treat the changed lease

as follows: 1 if the change becomes effective on the lease commencement date if the lease will be classified as an

operating lease the group will treat it as a new lease from the effective date of the lease change the book value of

the leased asset shall be the net investment in the lease prior to the effective date of the lease change. 2 if the

change takes effect on the effective date of the lease the lease will be classified as a financial lease the

accounting treatment of the group is in accordance with the provisions of the "Accounting Standards for

enterprises No. 22-recognition and measurement of financial instruments" concerning modification or

renegotiation of contracts.

36. Fair value measurement

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly

transaction between market participants at the measurement date.The Group measures related assets or liabilities at fair value assuming the assets or liabilities are exchanged in an

orderly transaction in the principal market; in the absence of a principal market assuming the assets or liabilities

are exchanged in an orderly transaction in the most advantageous market. Principal market (or the most

advantageous market) is the market that the Group can normally enter into a transaction on measurement date.The Group adopts the presumptions that would be used by market participants in achieving the maximized

economic value of the assets or liabilities.For financial assets or financial liabilities with active markets the Group uses the quoted prices in active markets

as their fair value. Otherwise the Group uses valuation technique to determine their fair value.Fair value measurement of a non-financial asset takes into account market participants’ ability to generate

economic benefits using the asset in its best way or by selling it to another market participant that would best use

the asset.The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are

available to measure fair value maximizing the use of relevant observable inputs and using unobservable inputs

only if the observable inputs aren’t available or impractical.Fair value level for assets and liabilities measured or disclosed at fair value in the financial statements are

determined according to the significant lowest level input to the entire measurement: Level 1 inputs are quoted

prices (unadjusted) in active markets for identical assets or liabilities that the Group can access at the

measurement date; Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable

90ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

for the assets or liabilities either directly or indirectly; Level 3 inputs are unobservable inputs for the assets or

liabilities.At the balance sheet date the Group revalues assets and liabilities being measured at fair value continuously in

the financial statements to determine whether to change the levels of fair value measurement.

37. Other significant accounting judgments and estimates

The Group conducts an ongoing evaluation of the significant accounting estimates and key assumptions used in

the light of historical experience and other factors including reasonable expectations of future events. Important

accounting estimates and key assumptions that are likely to result in the risk of a material adjustment in the

carrying value of assets and liabilities during the next fiscal year are set out below:

Classification of financial assets

The Group's major judgments in determining the classification of financial assets include the analysis of

business models and contractual cash flow characteristics.The Group determines the business model for the management of financial assets at the level of its financial

portfolio taking into account factors such as the way in which the performance of financial assets is evaluated

and reported to key managers the risks affecting the performance of financial assets and their management

methods and the way in which managers of related businesses are remunerated.When evaluating whether the contractual cash flow of financial assets is consistent with the basic lending

arrangement the Group has the following main judgments: whether the time distribution or amount of the

principal in the duration period may change due to reasons such as prepayment; Does interest include only the

time value of money credit risk other fundamental borrowing risks and consideration for costs and profits? For

example does the prepayment amount only reflect the outstanding principal and interest based on the

outstanding principal and reasonable compensation for early termination of the contract.Measurement of expected credit losses in accounts receivable

The Group calculates the expected credit loss of accounts receivable through the default risk exposure of

accounts receivable and the expected credit loss rate and determines the expected credit loss rate based on the

default probability and the default loss rate. In determining the expected credit loss rate the Group uses data

such as internal historical credit loss experience and adjusts the historical data in combination with the current

situation and forward-looking information. When considering forward-looking information the indicators used

by the Group include the risk of an economic downturn changes in the external market environment the

technological environment and customer conditions. The Group regularly monitors and reviews assumptions

relating to the calculation of expected credit losses.Deferred tax assets

Deferred tax assets should be recognized for all unutilized tax losses to the extent that there is likely to be

sufficient taxable profit to offset the loss. This requires management to use a great deal of judgment to estimate

when and how much future taxable profits will occur in combination with tax planning strategies to determine

the amount of deferred tax assets that should be recognized.The provision of land appreciation tax

The Group is subject to land appreciation tax (―LAT‖). The accrual of LAT is subject to management‘s

estimation which is made based on its understanding of the requirements of relevant tax laws and regulations.However the actual LAT is levied by tax authorities according to the interpretation of the tax rules. The group is

not stepping on formulating the final tax plan with relevant tax authorities hence the final tax outcome could be

91ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

different from the amount that was initially recorded and these differences will have an impact on tax provision

in current period.Determination of fair value of unlisted equity investments

The fair value of an unlisted equity investment is the estimated future cash flows discounted at the current

discount rate for Items with similar terms and risk characteristics. This valuation requires the Group to estimate

expected future cash flows and the discount rate and is therefore subject to uncertainty. In limited circumstances

if the information used to determine the fair value is insufficient or if the possible estimates of the fair value are

spread over a wide range and the cost represents the best estimate of the fair value within that range the cost

may represent the appropriate estimate of the fair value within that range.

38. Changes in significant accounting policies and accounting estimates

(1) Significant changes in accounting policies

□ Applicable √ Not Applicable

(2) Significant changes in accounting estimates

□ Applicable √ Not Applicable

(3) Adjustments to financial statement items at the beginning of the year of the first implementation of

the new accounting standards implemented since 2023

□ Applicable √ Not Applicable

39. Other

Maintenance fund

When the Group collects the maintenance fund from the owners according to a certain proportion of the sales

amount of commercial houses it shall be included in other payables for accounting; When the collected

maintenance funds are handed over to the land and housing administrative departments in accordance with the

regulations the maintenance funds collected on behalf of them shall be reduced.Quality deposit

The Group shall keep the quality deposit in proportion to the payment period stipulated in the contract of civil

engineering and installation engineering and deduct it from the civil engineering and installation Item payment

which shall be classified as other payables. The maintenance expenses incurred due to quality during the

warranty period shall be directly charged under this item and liquidated after the warranty period.VI. Taxation

1. Main types of taxes and corresponding tax rates

Tax type Tax basis Tax rate%

VAT Taxable income 9% 6% 5% 3%

City maintenance and construction

Turnover tax payable 7%

tax

92ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Corporate income tax Taxable profits 25% 16.5%

It shall be levied on the basis of the

value-added value of the real estate

Four progressive rates of excess

Land appreciation tax transferred and the prescribed tax

rate: 30% 40% 50% 60%

rate and paid in advance according

to the type of real estate product

70% of the original value of

Property tax 1.2% 12%

properties/ rental income

Education surcharge Turnover tax payable 3%

Local education surcharge Turnover tax payable 2%

The disclosure of taxpayers in different corporate income tax rates:

Name of taxpayer Income tax rate

2. Tax preferential treatment

Subsidiaries of the Group Shenzhen Huazhan Construction Supervision Co. Ltd. and Shantou Special

Economic Zone Xiangshan Real Estate Development Co. Ltd. are applicable to the preferential tax rate of 20%

for small and low-profit enterprises.

3. Other

Explanation for the VAT rate of different business activities:

With regards to revenue from property development property management and construction activities from

May 1st 2016 the group‘s taxable items and tax rates are shown in the following table which in accordancewith the relevant regulations of《Notice on Comprehensively Promoting the Trial of Replacing Business Taxwith Value-Added Tax》(No. 36 of CaiKuai [2016]):

Taxable income Means to calculate Tax Tax Rate%

Revenue from property sales Simplified Tax Method 5

Revenue from construction Simplified Tax Method 9 3

Rental income Simplified Tax Method 5

Revenue from property

General Tax Method 6

management

VII. Notes to the consolidated financial statements

1. Cash at bank and Cash Equivalent

Presented in RMB

Item As at 30 June 2023 As at 1 January 2023

Cash in hand 13721.59 4549.61

Deposits with banks 154829181.66 163083275.13

Other monetary funds 27447635.88 34576125.00

Total 182290539.13 197663949.74

Including: Total overseas deposits 5938023.23 5840173.03

Total deposits with

restrictions on use due to 7509424.55 7298880.26

mortgage pledge or freeze

93ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Other notes:

At the end of 30 June 2023 there were CNY 7510191.40 of restricted funds in the bank deposits of which

CNY 388115.74 were the funds frozen by the lawsuit and CNY 5674439.78 were the funds for the

construction of public facilities in and around the city of Longgang district. At the end of 30 June 2023 the

balance of other monetary funds of CNY 27446869.03 is seven-day notice deposit including principal of CNY

26000000.00 and interest of CNY 1446869.03.

2. Trading financial assets

Presented in RMB

Item As at 30 June 2023 As at 1 January 2023

As at fair value through profit or

274992968.77408154361.42

loss

Including:：

wealth management fund 274992968.77 408154361.42

Including:：

Total 274992968.77 408154361.42

Other notes:

3. Notes receivable

(1) Types of notes

Presented in RMB

Item As at 30 June 2023 As at 1 January 2023

Commercial acceptance bill 1536150.00

Total 1536150.00

Presented in RMB

As at 30 June 2023 As at 1 January 2023

Bad debt Bad debt

Book balance Book balance

provision provision

Types Provisi Book Provisi Book

Amoun Percent Amoun on value Amoun Percent Amoun on value

t age t proport t age t proport

ion ion

Includi

ng：

Bad

debt

provisi

ons

16170100.0080850.15361

made 5.00%

00.00%0050.00

on a

combin

ation

basis

Includi

ng：

16170100.0080850.15361

Total 5.00%

00.00%0050.00

94ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Bad debt provisions made on a combination basis

Presented in RMB

As at 30 June 2023

Item

Book balance Bad debt provision Provision proportion

Note to the basis for determining the combination:

Please refer to the way of disclosing other receivables’ bad debt provision to disclose relevant information if

the group choose to use general model of expected credit losses to accrue bad debts of notes receivable.□ Applicable √ Not Applicable

(2) Additions recoveries or reversals of provision for the current period

Additions in current period：

Presented in RMB

The amount of change in current period

As at 1 As at 30 June

Item

January 2023 Recoveries or Provision Written-off Others 2023

reversals

commercial

acceptance 80850.00 -80850.00 0.00

bill

Total 80850.00 -80850.00 0.00

Including: significant recoveries or reversals of bad debt provisions in the current period:

□ Applicable √ Not Applicable

(3) Notes receivable pledged by the Group at the end of the period

Presented in RMB

Types Amount pledged at the end of the period

(4) At the end of the period the Group's endorsed or discounted notes receivable which have not yet

matured

Presented in RMB

Derecognized Amount at the end of Amount that is not derecognized at

Types

the period the end of the period

(5) Notes receivable transferred to accounts receivable by the Group due to the drawer's non-

performance at the end of the period

Presented in RMB

Amount transferred to accounts receivable at the end

Types

of the period

commercial acceptance bill 1536150.00

Total 1536150.00

Other Note:

95ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

(6) Actual write-off of notes receivable in the current period

Presented in RMB

Item Written-off amount

Including the significant write-offs of notes receivable are as follows

Presented in RMB

Accounts

receivable

Approval

Name of the Nature of Written-off Reason for arising from

procedures

entity accounts amount written-off related party

performed

transactions(Y/

Note:

4. Accounts receivable

(1) Types of accounts receivable

Presented in RMB

As at 30 June 2023 As at 1 January 2023

Bad debt Bad debt

Book balance Book balance

provision provision

Types Provisi Book Provisi Book

Amoun Percent Amoun on value Amoun Percent Amoun on value

t age (%) t percent t age (%) t percent

age age

Bad

debt

provisi

ons

370643234847157367223200647157

made 41.43% 87.28% 37.62% 87.16%

702.69952.2050.49640.73890.2450.49

on an

individ

ual

basis

Includi

ng:

Bad

debt

provisi

ons

523901225851164608862021558864

made 58.57% 2.34% 62.38% 3.32%

768.7455.90912.84221.1749.50671.67

on a

combin

ation

basis

Includi

Receiv

able

523901225851164608862021558864

from 58.57% 2.34% 62.38% 3.32%

768.7455.90912.84221.1749.50671.67

other

corpora

96ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

custom

ers

89455100.00335745588097608100.003402863580

Total 37.53% 34.86%

471.43%808.10663.33861.90%439.74422.16

Bad debt provisions made on an individual basis : 33574808.1

Presented in RMB

As at 30 June 2023

Item Provision

Book balance Bad debt provision Reason

percentage

Agent for import Could be

and export business 11574556.00 11574556.00 100.00% uncollectible

payment

Long-term

Could be

receivable of 10376052.81 10376052.81 100.00%

uncollectible

property sale

Shenzhen Hongteng

Investment recoverability is

11789376.237073625.7460.00%

Management Co. relatively small

Ltd.Accounts receivable Could be

from the revoked 2314755.46 2314755.46 100.00% uncollectible

subsidiary

Accounts receivable

Could be

from other 1009962.19 1009962.19 100.00%

uncollectible

customers

Total 37064702.69 32348952.20

Bad debt provision made on a combination basis: 1225855.90

Presented in RMB

As at 30 June 2023

Item

Book balance Bad debt provision Provision percentage

Other customers

52390768.741225855.902.34%

receivables

Total 52390768.74 1225855.90

Note to the basis for determining the combination:

Please refer to the way of disclosing other receivables’ bad debt provision to disclose relevant information if

the group choose to use general model of expected credit losses to accrue bad debts of accounts receivable.□ Applicable √ Not Applicable

Disclosure by Aging

Presented in RMB

Aging As at 30 June 2023

Within 1 year（include 1 year） 56269431.11

1 to 2 years 9280506.18

3 to 5 years 23905534.14

More than 5 years 23905534.14

Total 89455471.43

97ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

(2) Additions recoveries or reversals of provision for the current period

Provision for the current period:

Presented in RMB

Amount changes in current period

As at 1 As at 30 June

Types Recoveries or

January 2023 Provision Written-off Others 2023

reversals

Bad debt 34028439.7 33574808.1

-440326.7813304.86

provision 4 0

34028439.733574808.1

Total -440326.78 13304.86

Including: significant recoveries or reversals of bad debt provisions in the current period are as follows:

Presented in RMB

Name of the entity Recoveries or reversals amount Recovery manner

(3) Actual write-off of accounts receivable in the current period

Presented in RMB

Item Written-off amount

Including the significant write-offs of accounts receivable are as follows

Presented in RMB

Accounts

receivable

Nature of Approval

Name of the Written-off Reason for arising from

accounts procedures

entity amount written-off related party

receivable performed

transactions(Y/

Note：

(4) The top five units with the ending balance of accounts receivable collected by the debtor

Presented in RMB

% of the total closing

Accounts receivable Bad debt provision

Name of the entity balance of accounts

The ending balance The ending balance

receivable

Wuhan 2049 Poly Real

Estate Development Co. 18362798.27 20.53% 393775.65

Ltd.Wuhan Yutian Xingye

15387703.3317.20%549760.09

Land Co. LTD

Shenzhen Hongteng

Investment Management 11789376.23 13.18% 7073625.74

Co. Ltd.Wuhan Linhong Land

10523608.1811.76%241396.87

Co. Ltd.Jiangsu Huajian

Construction Co. Ltd. 8693261.25 9.72% 260797.84

Shenzhen Branch

Total 64756747.26 72.39%

98ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

(5) Accounts receivable terminated due to the transfer of financial assets

(6) Transfer of accounts receivable and continue to involve the amount of assets and liabilities formed

Note：

5. Prepayments

(1) The aging analysis of prepayments is as follows

Presented in RMB

As at 30 June 2023 As at 1 January 2023

Aging

Amount % Amount %

Within 1 year 234279.60 30.71% 626155.65 53.81%

1 to 2 years 237765.60 31.17% 336699.64 28.94%

2 to 3 years 206.95 0.02%

More than 3 years 290782.99 6.83% 200550.00 17.24%

Total 762828.19 1163612.24

Reason for significant prepayments aging more than 1 year and not be settled:

(2) The top five units of the ending balance of prepayments

The sum of the top five prepayments collected by prepaid objects at the end of the period is 742942.32 yuan

which accounts for 97.39 % of the total ending balance of prepayments.Other notes：

6. Other receivables

Presented in RMB

Item As at 30 June 2023 As at 1 January 2023

Other receivables 21922385.34 42105050.33

Total 21922385.34 42105050.33

（1）Interest receivable

1）Interest receivable classification

Presented in RMB

Item As at 30 June 2023 As at 1 January 2023

2）Significant overdue interest

Presented in RMB

Whether

Overdue time impairment occurs

Borrowing unit The ending balance Overdue reason

(month) and the basis for

judgment

99ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Other notes：

3）Bad Debt Provisions

□ Applicable √ Not Applicable

（2）Dividends receivable

1）Dividends receivable classification

Presented in RMB

Items (or invested units) As at 30 June 2023 As at 1 January 2023

2）Significant dividends receivable overdue more than one year are as follows:

Presented in RMB

Whether

Items (or invested Reasons for not impairment occurs

As at 30 June 2023 Aging

units) retrieving and the basis for

judgment

3）Bad Debt Provisions

□ Applicable √ Not Applicable

Other notes：

（3）Other receivables

1）Other receivables disclosure by nature

Presented in RMB

Item Book balance as at 30 June 2023 Book balance as at 1 January 2023

Other receivables from employee’s

266831.37147810.19

petty cash

Other receivables from the

768208.38689317.63

collecting and paying on behalf

Other receivables from other

59715244.7380028366.45

customers

Other receivables from related

154600573.04156470188.49

parties

Total 215350857.52 237335682.76

2）Bad Debt Provision

Presented in RMB

first stage Second stage Third stage

To 12-month To lifetime

Bad Debt Provision To 12-month expected credit loss expected credit loss Total

expected credit loss (no credit (has occurred credit

impairment) impairment)

Balance as at 1 1524758.92 193705873.51 195230632.43

100ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

January 2023

Balance as at 1

January 2023 in

current period

Return the current -8000.00 -8000.00

Other changes 808813.28 1001346.97 1810160.25

Balance as at 30

723945.64192704526.54193428472.18

June 2023

Changes in the book balance with significant changes in the loss provision for the current period:

□ Applicable √ Not Applicable

Disclosure by aging

Presented in RMB

Aging As at 30 June 2023

Within 1 year (include 1 year) 41623990.70

1 to 2 years 6583028.71

2 to 3 years 13300.00

3 to 4 years 167130538.11

More than 5 years 167130538.11

Total 215350857.52

3）Additions recoveries or reversals of provision for the current period

Bad debt provisions in the current period

Presented in RMB

Amount changes in current period

As at 1 As at 30 June

Types

January 2023 Recoveries or Additions Written-off Others 2023

reversals

Other

receivables 195230632. 193428472.-8000.001810160.25

bad debt 43 18

provision

195230632.193428472.

Total -8000.00 1810160.25

4318

Including: significant recoveries or reversals of bad debt provisions in the current period are as follows:

Presented in RMB

Name of the entity Amount of recoveries or reversals Recovery manner

4）Other receivables actually written off in the current period

Presented in RMB

Item Amount of written-off

Including the important accounts receivable write-off situation is as follows

Presented in RMB

Name of the Nature of other Amount of Verification and Whether the

Reason

entity receivable written-off cancellation payment is

101ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

procedures to be generated by an

performed affiliate

transaction

Note：

5）The top five units of ending balance of other receivables

Presented in RMB

Proportion of

Ending balance Ending balance

Name of the Nature of other total ending

of other Aging of bad debt

entity receivables balance of other

receivables provision

receivables (%)

Canada Great

Wall More than 5

current account 89035748.07 41.34% 89035748.07

(Vancouver) years

Co. Ltd

More than 5

Paklid Limited current account 19506273.32 9.06% 19506273.32

years

Australia

Bekaton More than 5

current account 12559290.58 5.83% 12559290.58

property years

Limited

Guangdong

province

More than 5

Huizhou Luofu current account 10465168.81 4.86% 10465168.81

years

Hill Mineral

Water Co.Ltd

Xi’an Fresh

Peak Property More than 5

current account 8419205.19 3.91% 8419205.19

Trading Co. years

Ltd

Total 139985685.97 65.00% 139985685.97

6）Government subsidies receivable

Presented in RMB

Name of Estimated time

Name of the

government subsidy The ending balance Aging amount and basis of

organization

item collection

7）Other receivables terminated due to the transfer of financial assets

8）Amount of assets and liabilities formed by transferring other receivables and continuing to involve

them

Other notes:

7. Inventories

Does the Company need to comply with the disclosure requirements of real estate industry?

Yes

102ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

（1）Inventory classification

The company complies with the disclosure requirements of "Shenzhen Stock Exchange Industry Information

Disclosure Guidelines No. 3-Listed Companies Engaged in Real Estate Business".Classified by nature:

Presented in RMB

As at 30 June 2023 As at 1 January 2023

Provision for Provision for

impairment impairment

of of

inventories/p inventories/p

Item The book The book

Book balance rovision for Book balance rovision for

value value

impairment impairment

of contract of contract

performance performance

cost cost

Real estate

344961781344961781341396326341396326

developing

0.460.461.851.85

cost

Real estate

790009176.790009176.842847684.842847684.

developed

74743333

products

Raw

0.008458.348458.34

materials

Finished

316588.9238891.91277697.01329101.7038891.91290209.79

goods

423994357423990468425714850425710961

Total 38891.91 38891.91

6.124.216.224.31

The main items of " Real estate developing cost " and their interest capitalization are shown below:

Presented in RMB

Includ

Less:

Amou

Transf

Cumul nt of

Estima er to Add:

Time As at Less: As at ative interested “Real Increa SourceStartin for 1 Other 30 interes t

Item total estate se in s of

g time compl Januar reducti June t capital

invest develo this funds

etion y 2022 on 2022 capital ized in

ment ped period

ization the

produc

curren

period

ShanT

2829128291

Fresh

908.1 908.1 Other

Peak

Buildi

Lin

302290229733278

Xin 6218

June 80522 02350 019.9 Other

Garde 275.18

20259.965.149

Guang 8 7 1094 29436 1124 2265 1609 Bank

103ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

mingli Februa Dece 86612 273.4 30239 037.89 531.95 loans

ry mber 3.78 3 7.21 others

20222024

341335654344935543

1609

Total 96326 548.6 61781 057.8

531.95

1.8510.468

The main items of "Real estate developed products" and their interest capitalization are shown below:

Presented in RMB

Include:

Amount of

Cumulative

As at 1 interest

Time for As at 30 interest

Item January Increase Decrease capitalized

completion June 2023 capitalizati

2023 in the

current

period

Jinye

Island 16 Sep. 39546392 39477078

4200.00

Multi-tier 1997 .27 .34

villa

Jinye

5696007.5696007.

Island villa 2 Dec 2010 0.00

2525

No.10

Jinye

20 Aug. 2333281. 2333281.

Island villa 0.00

20084242

No.11

YueJing

18 Nov. 6476404. 6357945.

dongfang 118459.23

20147653

Project

HuangPu

140000.00140000.00

XinCun

Beijing

Fresh Peak 304557.05 304557.05

Building

TianYue 15 Dec. 22565352 6281424. 21937209

Bay No.1 2017 2.83 21 8.62

Shenfang

8 May 45617437 19908371 25709066

CuiLin

2018.79.01.78

Building

Chuanqi 4289919. 4289919.

8 Dec 2019 0.00

Donghu 17 17

TianYue 30 June 51279016 22171020 49061914

Bay No.2 2021 1.79 .04 1.75

842847685276919379000917

Total 4200.00

4.33.666.74The main items of "instalment on development products” "leased development products” “Revolving room”

are shown below:

Presented in RMB

As at 1 January

Item Increase Decrease As at 30 June 2023

2023

2）Provision for inventories and impairment of contract performance costs

The main items of provision for inventories are shown below:

104ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Classified by nature：

Presented in RMB

Increase in the reporting Decrease in the reporting

Opening period period Ending

Item Note

balance Reversal or balance

Provision Others Others

Offset

Finished

38891.9138891.91

products

Total 38891.91 38891.91

Classified by items:

Presented in RMB

Increase in the reporting Decrease in the reporting

Opening period period Ending

Item Note

balance Reversal or balance

Provision Others Others

Offset

（3）The ending balance of inventory contains the explanation of the capitalized amount of borrowing

expenses:

As at 30 June 2023 the Group's inventory balance contains capitalized borrowing costs at 35543057.88 yuan.

（4）Restriction on Inventories

Disclose restriction on Inventories by projects：

Presented in RMB

Name of project Opening balance Ending balance Reason of restriction

Land mortgaged for

Inventories 965000000.00 965000000.00 project development

loans

Total 965000000.00 965000000.00

8. Other current assets

Presented in RMB

Item As at 30 June 2023 As at 1 January 2023

Contract acquisition costs 1397895.00 1212848.49

Advance or prepaid income tax 789501.68 1692386.28

Prepaid VAT 1876020.62 1620352.66

Pending deduct vat on purchase 30787643.44 29247467.16

Land Appreciation Tax 2594592.04 1813337.72

Business Tax 150024.32 250719.98

Others 998562.58 941529.13

Total 38594239.68 36778641.42

Other notes:

9. Long-term equity investments

Presented in RMB

Invest Openi Movements during the period Endin Balanc

105ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

ees ng Invest Declar g e of

balanc ment ed balanc provisi

e incom distrib Provis e on for

Other

(book e Adjust ution ion f (book impair

Increa Decre equity

value) recogn ment of or Other value) ment

se ase move

ised in OCI cash impair as

ments

under divide ment June

equity nds or 30

met ho profits 2023

1. Joint Venture

Guang

dong

provin

Huizh

996999699969

Luofu

206.09206.09206.09

Hill

Miner

Water

Co.Ltd

Fengk

945594559455

Xinhu

465.38465.38465.38

Hotel

194241942419424

Subtot

671.4671.4671.4

777

2. Associates

Shenz

hen

Rongh

117011701076

882.28882.28954.64

JiDian

Co.ltd

Shenz

hen

Runhu

144514451445

Autom

425.56425.56425.56

obile

tradin

g Co.Ltd

Dongy

i Real 30376 30376 30376

Estate 084.8 084.8 084.8

Co. 9 9 9

Ltd

329923299232898

Subtot

392.7392.7465.0

339

Total 52417 52417 52323

106ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

064.2064.2136.5

006

Other notes

10. Investments in other equity instrument

Presented in RMB

Item As at 30 June 2023 As at 1 January 2023

Shantou Small &Medium

Enterprises Financing Guarantee 14191290.63 13839235.57

Co. Ltd

Total 14191290.63 13839235.57

Itemized disclosure of investment in non-trading equity instruments for the current period

Presented in RMB

Reasons for

designating

The amount

Dividend fair value

of other

income measurement

The The comprehensi

recognized and its Transferring

Item cumulative cumulative ve reserve

for the changes reasons

gains loss transferred

current included in

into retained

period other

earnings

comprehensi

ve income

Shantou

Small

&Medium

Enterprises 5550600.00

Financing

Guarantee

Co. Ltd

Other notes:

11. Investment property

(1) Investment properties measured using the cost model

Presented in RMB

Construction in

Item Buildings Land use rights Total

progress

Ⅰ. Cost

1. Balance as at 31

1044744895.39107350053.051152094948.44

Dec. 2022

2. Additions during

3779432.133779432.13

the year

（1）Purchase

（2）Transfer from

Inventories\Fixed

assets\ construction

in progress

107ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

（3）Additions due

to business

combinations

（4）Others

(Exchange Rate 3779432.13 3779432.13

Changes)

3. Decrease during

the year

（1）Disposals

（2）Other

transfers out

4.Balance as at 30

1044744895.39111129485.181155874380.57

June 2023

II. Accumulated

depreciation or

amortization

1. Balance as at 31

482985291.20482985291.20

Dec. 2022

2. Charge for the

12856812.5712856812.57

year

（1）Depreciated

12856812.5712856812.57

or amortised

3. Reductions

during the year

（1）Disposals

（2）Other

transfers out

4.As at 30 June

495842103.77495842103.77

2023

III. Provision for

impairment

1. Balance as at 31

14128544.6288107197.55102235742.17

Dec. 2022

2. Charge for the

3101956.303101956.30

year

(1) Provision

(2) Others

(Exchange Rate 3101956.30 3101956.30

Changes)

3. Reductions on

disposals

（1）Disposals

（2）Other

transfers out

4.As at 30 June

14128544.6291209153.85105337698.47

2023

IV. Carrying

amounts

108ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

1. As at 30 June

534774247.0019920331.33554694578.33

2023

2. As at 31 Dec

547631059.5719242855.50566873915.07

2022

2）Investment property measured at fair value

□ Applicable √ Inapplicable

The company complies with the disclosure requirements of "Shenzhen Stock Exchange Industry Information

Disclosure Guidelines No. 3-Listed Companies Engaged in Real Estate Business"

Disclosed by projects：

Presented in RMB

Reasons

Rental Fair value Fair value

Time for Movemen and Index

Project building income in as at 31 as at 30

Location completio t in Fair for fair

name area reporting Dec. June

n value value

period 2022 2023

change

Does the company have investment real estate that is currently under construction?

□ Yes √ No

Whether the company has new investment real estate measured at fair value in the current period?

□ Yes √ No

（3）Investment properties pending certificates of ownership

Presented in RMB

Reason why certificates are pendin

Item Carrying amount

Other notes

12. Fixed assets

Presented in RMB

Item As at 30 June 2023 As at 31 Dec. 2022

Fixed assets 20677375.65 21425475.05

Total 20677375.65 21425475.05

（1）Fixed assets

Presented in RMB

Electronic

Item Plant & buildings Motor vehicles equipment and Total

others

I．Cost：

1. Balance as at 31

100422074.108307455.417403998.70116133528.21

Dec. 2022

2.Additions during 0.00 377300.00 232308.74 609608.74

109ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

the year

(1) Purchases 0.00 377300.00 232308.74 609608.74

(2) Transfers from

construction in

progress

(3) Additions due to

business

combinations

3. Decrease during

895187.5010382.05905569.55

the year

(1) Disposals or

895187.5010382.05905569.55

written-offs

4.As at 30 June

100422074.107789567.917625925.39115837567.40

2023

II. Accumulated

depreciation

1. Balance as at 31

81649438.777111284.475947329.9294708053.16

Dec. 2022

2. Charge for the

1083182.69118565.87155440.481357189.04

year

(1) Provision 1083182.69 118565.87 155440.48 1357189.04

3. Reductions for

895187.509862.95905050.45

the year

(1) Disposal or

895187.509862.95905050.45

written-offs

1. Balance as at

82732621.466334662.846092907.4595160191.75

30 June 2023

III. Provision for

impairment

1. Balance as at 31

Dec. 2022

2. Charge for the

year

(1) Provision

3. Reductions for

the year

(1) Disposals or

written-offs

4． Balance As at

30 June 2023

IV. Carrying

amount

1. As at 30 June

17689452.641454905.071533017.9420677375.65

2023

2. As at 31 Dec.

18772635.331196170.941456668.7821425475.05

2022

110ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

（2）Temporarily idle fixed assets

Presented in RMB

Accumulated Provision for Carrying

Item Cost Note

depreciation impairment Amount

（3）Fixed assets leased out under operating leases

Presented in RMB

Item Carrying amount at the end of reporting period

（4）Fixed assets pending certificates of ownership

Presented in RMB

Reason why certificates of

Item Carrying amount

ownership are pending

Other notes

（5）Fixed assets to be disposed of

Presented in RMB

Item As at 30 June 2023 As at 31 Dec. 2022

Other notes:

13. Use rights assets

Presented in RMB

Item Plant & buildings Total

Ⅰ. Cost

1. Balance as at 31 Dec. 2022 431779.61 431779.61

2. Additions during the year

3. Decrease during the year

4.Balance as at 30 June 2023 431779.61 431779.61

II. Accumulated depreciation or

amortization

1. Balance as at 31 Dec. 2022 199282.89 199282.89

2. Charge for the year 66427.64 66427.64

(1)Depreciated or amortised 66427.64 66427.64

3. Reductions during the year

(1)Disposals

4.As at 30 June 2023 265710.53 265710.53

III. Provision for impairment

1. Balance as at 31 Dec. 2022

2. Charge for the year

(1) Provision

3. Reductions for the year

(1)Disposals

4.As at 30 June 2023

111ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

IV. Carrying amounts

1. As at 30 June 2023 166069.08 166069.08

2. As at 31 Dec 2022 232496.72 232496.72

Other notes：

14. Intangible assets

（1）Intangible assets

Presented in RMB

Land use Patent

Item Know-how Software Total

rights right

I.Cost

1. Balance as at 31 Dec.

2192000.002192000.00

2022

2.Additions during the year

(1) Purchase

(2) Internal

development

(3) Additions due to

business combination

3. Decrease during the year

(1) Disposals

4.As at 30 June 2023 2192000.00 2192000.00

II. Accumulative amortisation

1. Balance as at 31 Dec.

2192000.002192000.00

2022

2. Charge for the year

(1) Provision

3. Reductions for the year

(1) Disposals

4.As at 30 June 2023 2192000.00 2192000.00

III. Provision for impairment

1. Balance as at 31 Dec.

2022

2. Charge for the year

(1) Provision

3. Reductions for the year

(1) Disposals

4.As at 30 June 2023

IV. Carrying amount

1. As at 30 June 2023

2. As at 31 Dec. 2022

The carrying amount of intangible assets of the Group arising from internal development is 0.00% of the total

carrying amount of intangible assets at the end of the year.

（2）Land use rights pending certificates of ownership

Presented in RMB

Reason why certificates of

Item Carrying amount

ownership are pending

Other notes

112ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

15. Long-term deferred expense

Presented in RMB

As at 1 Jan. Additions Amortisation Others As at 30 June

Item

2023 during the year for the year decreases 2023

Renovation

1719057.9920803.21283035.941456825.26

Costs

Others 457163.54 83999.46 373164.08

Total 2176221.53 20803.21 367035.40 1829989.34

Other notes

16. Deferred tax assets/Deferred tax liabilities

（1）Deferred tax assets and deferred tax liabilities that are not offset

Presented in RMB

As at 30 June 2023 As at 31 Dec. 2022

Item Deductible or Deductible or

Deferred tax assets Deferred tax assets

taxable temporary taxable temporary

Provisions for

impairment of 12026682.71 3006670.68 12026682.71 3006670.68

assets

Unrealised profits

of intra-group 83966762.00 20991690.50 86124778.41 21531194.60

transactions

Deductible tax

69016233.1217254058.2869038992.7117259748.18

losses

Provision for land

appreciation tax 117245335.26 29311333.82

liquidation reserves

Accrued

23711126.845927781.7023711126.845927781.70

Contractual cost

Total 188720804.67 47180201.16 308146915.93 77036728.98

（2）Deferred tax liabilities without offsetting

Presented in RMB

As at 30 June 2023 As at 31 Dec. 2022

Deductible or Deductible or

Item Deferred tax Deferred tax

taxable temporary taxable temporary

liabilities liabilities

differences differences

Changes in the fair

value of other

1839235.57459808.891839235.57459808.89

equity instrument

investments

Interest not due 1576125.00 394031.25 1576125.00 394031.25

Changes in fair

value of held-for-

8970031.502242507.888970031.502242507.88

trading financial

assets

Total 12385392.07 3096348.02 12385392.07 3096348.02

113ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

（3）Deferred tax assets or deferred tax liabilities disclosed as net amount after offsetting

Presented in RMB

Deferred tax assets Deferred tax assets

Amount of Amount of

or liabilities after or liabilities after

Item offsetting as at 30 offsetting as at 31

offsetting as at 30 offsetting as at 31

June 2023 Dec. 2022

Deferred tax assets 47180201.16 77036728.98

Deferred tax

3096348.023096348.02

liabilities

（4）Details of unrecognized deferred tax assets

Presented in RMB

Item As at 30 June 2023 As at 31 Dec. 2022

Deductible tax losses 49941635.58 54027120.82

Bad debt provision 197543730.87 197543730.87

Provision for impairment of long-

220084700.95220084700.95

term equity

Provision for impairment of

102235742.17102235742.17

investment real estate

Total 569805809.57 573891294.81

（5）Expiration of deductible tax losses for unrecognised deferred tax assets

Presented in RMB

Year As at 30 June 2023 As at 31 Dec. 2022 Note

20234085485.24

2024688456.49688456.49

20251629.251629.25

2026346891.06346891.06

202748904658.7848904658.78

Total 49941635.58 54027120.82

Other note

17. Short-term loans

（1）Classification of short-term loans

Presented in RMB

Item As at 30 June 2023 As at 31 Dec. 2022

Pledge loans 45050727.80 51138077.62

Total 45050727.80 51138077.62

Note:

The ending balance of the loan consist of the factoring with accounts receivables.

（2）Past due short-term loans

The total balance of past due short-term loans at the end of the year is RMB 0 including significant items are as

follows:

114ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Presented in RMB

Interest rate if

Lender As at 30 June 2023 Interest rate Past due period

overdue

Other notes

18. Notes payable

Presented in RMB

Kind of Class Ending balance Opening balance

The total amount of notes payable due and unpaid at the end of the current period is RMB 220898556.87.

19. Accounts payable

（1）Accounts payable

Presented in RMB

Item As at 30 June 2023 As at 31 Dec. 2022

Construction 397127529.59 432902243.31

Others 1729506.45 1699316.36

Total 398857036.04 434601559.67

（2）the age of more than 1 year of important accounts payable

Presented in RMB

Reasons for non-payment or non-

Item As at 30 June 2023

carry-forward

Other notes:

20. Advances from customers

（1）Advance payments

Presented in RMB

Item As at 30 June 2023 As at 31 Dec. 2022

Payment for goods-import and

4218370.694218370.69

export

Others 653101.19 1246973.27

Total 4871471.88 5465343.96

（2）Important advances received over one year

Presented in RMB

Reasons for non-payment or non-

Item As at 30 June 2023

carry-forward

Other notes:

21. Contractual liabilities

Presented in RMB

115ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Item As at 30 June 2023 As at 31 Dec. 2022

Advance in house payment 34155928.57 43431327.09

Advance in room fee 100408.38 102140.20

Total 34256336.95 43533467.29

Changes in amount and reason for the change in reporting period:

Presented in RMB

Chang

es in

Item the Reason for change

amoun

Advan

ce in -

house 9275 Real estate sales meet the income recognition conditions and carry forward income

payme 398.52

Total 9275

398.52

The company needs to comply with the disclosure requirements of "real estate industry" in the "Shenzhen Stock

Exchange Listed Company Self-Regulatory Supervision Guidelines No. 3 - Industry Information Disclosure"

Receipt information of the top five projects in the pre-sale amount:

Presented in RMB

As at 31 Dec. As at 30 June Estimated

Serial number Item Pre-sale ratio

2022 2023 completion time

22. Payroll payable

（1）Employee benefits payable

Presented in RMB

Accrued during the Decreased during

Item As at 31 Dec 2022 As at 30 June 2023

year the year

Short-term

35672352.3725379314.0334995612.7326056053.67

employee benefits

Post-employment

benefits - defined 51851.41 4882198.99 4882199.11 51851.29

contribution plans

Total 35724203.78 30261513.02 39877811.84 26107904.96

（2）Short-term employee benefits

Presented in RMB

As at 31 Dec Accrued during Decreased during

Item As at 30 June 2023

2022 the year the year

1.Salaries bonus

35211378.7718382586.3127665932.8525928032.23

allowances

2.Staff welfare 220742.00 1678076.40 1898818.40 0.00

3.Social insurances 2061716.10 2061716.10 0.00

116ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Including: Medical

1928118.491928118.490.00

insurance

Work-related injury

30931.5430931.540.00

insurance

Maternity insurance 102666.07 102666.07 0.00

4. Housing Fund 2685845.63 2685845.63 0.00

5. Labor union fees staff

240231.60571089.59683299.75128021.44

and workers’ education fee

Total 35672352.37 25379314.03 34995612.73 26056053.67

（3）Post-employment benefits - defined contribution plans

Presented in RMB

Accrued during the Decreased during

Item As at 31 Dec 2022 As at 30 June 2023

year the year

Basic pension

2910855.302910855.300.00

insurance

Unemployment

32286.6232286.620.00

insurance

Annuity 51851.41 1939057.07 1939057.19 51851.29

Total 51851.41 4882198.99 4882199.11 51851.29

Other notes

23. Tax payable

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

Value-added tax 2816273.69 3843704.80

Corporate income tax 18971573.83 61927050.99

Individual income tax 603654.85 1611643.13

City maintenance and construction

852519.05734949.61

tax

Land appreciation tax 8253213.62 121891472.74

Property tax 4982103.54 287141.98

Education surcharge 361834.61 316008.58

local education surcharge 241223.07 197568.44

Others 488239.67 141645.72

Total 37570635.93 190951185.99

Other notes

24. Other payables

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

Interest payables 16535277.94 16535277.94

Other payables 538530321.81 557796062.90

Total 555065599.75 574331340.84

（1）Interest payable

Presented in RMB

117ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Item As at 30 June 2023 As at 31 Dec 2022

Non-financial institution borrowing

interest (interest payable to parent 16535277.94 16535277.94

company)

Total 16535277.94 16535277.94

Significant overdue interest outstanding:

Presented in RMB

Debtor Overdue amount Overdue reason

Shenzhen Investment Holdings

16535277.94 Defer payment

Co. Ltd.Total 16535277.94

Other notes:

The loan principal was paid in full on 22 Dec. 2016.

（2）Dividends payable

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

Reason for significant dividends not paid in 1 year:

（3）Other payables

1）Other payables (by nature)

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

Current account to Non-Related

160011335.42166065259.07

parties

Current account to Related parties 230698698.75 232502015.42

Deposits 24822234.12 28723844.16

Others 122998053.52 130504944.25

Total 538530321.81 557796062.90

2）significant other payables aging over 1 year

Presented in RMB

Item As at 30 June 2023 Reason for no repayment

Guangzhou Bopi Enterprise Within 1 year 1-2

203265265.50

Management Consulting Co. LTD years 2-3 years

Huizhou Guirong Investment

Information 100033126.03

years

Consulting Co. LTD

Total 303298391.53

Other notes

25. Non-current liabilities due within one year

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

118ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

Long-term borrowings due within

19983173.226105770.99

one year

Lease liabilities due within one

83023.4483023.44

year

Total 20066196.66 6188794.43

Other notes:

26. Other current liabilities

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

Output tax to be transferred 2844613.84 2265817.68

Notes receivable that have been

endorsed but cannot be terminated 1617000.00

for recognition

Total 2844613.84 3882817.68

Movement in Short-term bonds payable：

Presented in RMB

Interest Amorti

As at is zation As at

Name The b The The

Face Releas issuanc 31 accrue of 30

of the ond de current current

value e date e Dec d at excess June

bond adline issue pay

2022 face discou 2023

value nt

Total

Other notes:

27. Long-term loans

（1）Long-term loans classification

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

Pledge loan 161876610.82 60366770.99

Less: long-term loans due within

-19983173.22-6105770.99

one year

Total 141893437.60 54261000.00

Note:

Additional notes including interest rate ranges:

The interest rate range is 3.70%-4.20%.

28. Lease liabilities

Presented in RMB

Item As at 30 June 2023 As at 31 Dec 2022

Buildings 95400.80 136908.67

Less: lease liabilities due within -83023.44 -83023.44

119ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

one year

Total 12377.36 53885.23

Other notes:

29. Share capital

Presented in RMB

Increase or decrease of current period (+ -)

Conversion

As at 31 As at 30

Stock from

Dec 2022 New shares Others Subtotal June 2023

dividend reserve to

The total

10116601011660

number of

000.00000.00

Other notes:

30. Capital reserves

Presented in RMB

Increase in current The reduced in

Item As at 31 Dec 2022 As at 30 June 2023

period current period

Share premium 557433036.93 557433036.93

Other capital

420811873.18420811873.18

reserves

Total 978244910.11 978244910.11

Reason for movements in capital reserves:

31. Other comprehensive income

Presented in RMB

Current amount

Less:

included

in other

comprehe

nsive

income in

The income in Attributa

the Attributa

current the Less: ble to As at 30

As at 31 previous ble to the

Item income previous Income minority June

Dec 2022 period parent

tax before period tax sharehold 2023

and company

the and expense ers after

transferre after tax

amount transferre tax

d to

d to profit

retained

or loss in

earnings

the

in the

current

period

I. Other

comprehe 1379426 352055.0 352055.0 1731481

nsive .68 6 6 .74

income

120ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

that

cannot be

reclassifie

d into

profits

and

losses

Changes

in the fair

value of

other

1379426352055.0352055.01731481

equity.6866.74

instrumen

investme

nts

II.Other

comprehe

nsive

income - - -

24547292242251

which is 3035396 2124777 910618.8

4.176.94

reclassifie .05 .23 2

d into

profit and

loss

Translatio

difference

s arising

from - - -

24547292242251

translatio 3035396 2124777 910618.8

4.176.94

n of .05 .23 2

foreign

currency

financial

statement

---

25926722415399

Total 2683340 1772722 910618.8

0.858.68.99.172

Other notes including the adjustment of the effective portion of the cash flow hedging gain or loss to the

initially recognised amount of the hedged item:

32. Surplus reserve

Presented in RMB

Additions during Reductions during

Item As at 31 Dec 2022 As at 30 June 2023

the year the year

Statutory surplus

275253729.26275253729.26

reserve

Total 275253729.26 275253729.26

Note:

121ShenZhen Special Economic Zone Real Estate & Properties (Group) Co. Ltd. Interim Report 2023

33. Retained earnings

Presented in RMB

Item Year ended 30 June 2023 Year ended 30 June 2022

Before adjustment: Retained

earnings at the end of the previous 1713155187.48 1671121562.98

period

After adjustment: Retained

earnings at the beginning of the 1713155187.48 1671121562.98

reporting period

Plus:Net profits for the year

-37118182.81153718805.57

attributable to owners of the Group

Less: Appropriation for statutory

34108874.33

surplus reserve

Dividends payable to ordinary

61711260.0089026080.00

Other -11449773.26

Retained earnings at the end of the

1614325744.67

reporting period

Adjustments on beginning retained earnings are as follows:

1). Retrospective adjustments of RMB 0.00 made on beginning retained earnings in accordance with CAS and

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