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China Fordoo Holdings Limited (Stock Code: 2399) Announces 2014 Interim Results

-- Turnover Reached RMB766.2 Million

-- Gross Profit Increased by 13.0% to RMB269.1 Million

HONG KONG, Aug. 28, 2014 /PRNewswire/ -- China Fordoo Holdings Limited ("Fordoo" or the "Company" and, together with its subsidiaries, the "Group", Stock Code: 2399), a reputable menswear brand in the PRC, is pleased to announce its interim results for the period ended 30 June 2014 (the "period").

During the period, benefited from the growing recognition of the Group's "FORDOO" brand and an increase in the average wholesale price of products, the Group's turnover increased to RMB766.2 million, representing an increase of 6.8% over the corresponding period last year (1H2013: RMB717.4 million). The expansion of distribution network further strengthened the profitability of the Group. Net profit increased by 8.5% to RMB128.7 million over the corresponding period in 2013. Basic and diluted earnings per share were RMB36 cents, representing an increase of 8.5% as compared to the corresponding period last year (1H2013: RMB33 cents).

Mr. Kwok Kin Sun, Executive Director, Chief Executive Officer and Chairman of the Board said, "In the first half of 2014, China's economic growth continued to slowdown and the retail market remained weak. For the apparel retail industry, the total retail sales of garments, hats, footwear and knitwear recorded a 10.0% year-on-year increase, which was 1.9 percentage points lower than that of the corresponding period in 2013. Therefore, the Group adopted a prudent operation strategy and focused on improving the distribution channel management and enhancing product quality and design. We are very satisfied that the purchase orders from the sales fair held in March 2014 increased by 24% from the ones held in September 2013."

Business Review

As a reputable menswear brand in the PRC, by product type, Fordoo continued to lead the market in the men's trousers segment. In the first half of 2014, turnover from men's trousers increased by 16.9% to RMB458.1 million as compared to the corresponding period last year (1H2013: RMB392.0 million). In addition, sales of trousers remained the major contributor to the total turnover with a proportion of 59.8%. In terms of product style, the Group maintained a healthy growth in the business formal and business casual series. The business casual series continued to be the largest turnover contributor to the Group with a proportion of 63.4% (1H2013: 61.1%).

The Group has been striving to optimize its retail and sales network for the sustainable business growth. As of 30 June 2014, the retail and distribution network of the Group further expanded to 52 distributors and 180 sub-distributors. During the period, the Group had a total 1,353 retail outlets (including 2 self-operated retail stores), representing a net increase of 53 retail outlets as at 31 December 2013, spanning over 240 cities and 31 provinces, autonomous regions and central government-administered municipalities in the PRC. The increase in retail outlets was a strategy to further penetrate into the markets in the second and third-tier cities.

In the first half of 2014, as part of the Group's marketing and promotion plan to enhance and reinforce its brand image, the renovation of 41 existing stores had completed, and the plan for renovating another 59 stores by the end of the year remained on track. In addition, the Group continued to actively carry out regular advertising and promotion campaign through various channels, such as advertisements in fashion magazines, promotion activities in the internet and other media, as well as advertisements on large outdoor billboards in airports, highways and well-known department stores.

Prospects

Looking ahead to the second half of 2014, the Group sustains its cautiously optimistic view with respect to the growth of consumer demand in menswear market in China. It is confident that the ongoing urbanization and expanding middle class in China will generate a strong demand on apparels in the long run. Therefore, the Group maintains its target for distributors of adding approximately 200 retail outlets within the year. In the coming 2014 spring/summer sales fair to be held in September 2014, the Group will launch a new casual fashion line targeting young customers aged 18 to 30.

Mr. Kwok concluded, "Fordoo will strive to seize the opportunities arising from the continuous growth of the men's casual wear and trousers market in PRC, as well as strengthen its cooperation with the distributors and sub-distributors. The Group will equip itself for the future development through enhancing its product design and development capability and kicking off the implementation of the ERP system. Driven by the success of men's trousers, business formal and business casual series, it is believed that the Group could continue its sustainable growth and maximize shareholders' returns."

- End -

About China Fordoo Holdings Limited

Fordoo is a reputable menswear brand in the PRC. Positioned in the middle-upper menswear segment, Fordoo primarily targets men aged 30 to 60. According to Frost & Sullivan, Fordoo brand was ranked sixth in the middle-upper menswear market with a market share of 2.9%, fifth in both the middle-upper business casual menswear segment and the middle-upper business formal menswear segment with respective market share of 4.0% and 2.9%, and second in the men's trousers category with a market share of 3.0%, all of which were in terms of retail sales in 2013. Fordoo manages and operates the business through a strategically integrated model, comprising brand management and marketing, design and product development, ordering process, procurement of raw materials, self-production and outsourced production and sales and distribution. As of 30 June 2014, Fordoo's distribution network comprised of 52 distributors, 180 sub-distributors and 1,353 retail outlets (excluding the two self-operated stores).

Issued by Porda Havas International Finance Communications Group for and on behalf of China Fordoo Holdings Limited.

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Sinopec Announces 2014 Interim Results

-- Operating Profit Records Double Digit Growth in the First Half of 2014

-- Marketing Business Restructuring and Shale Gas Development on Track

BEIJING, Aug. 22, 2014 /PRNewswire/ -- China Petroleum & Chemical Corporation ("Sinopec" or "the Company") (HKEX: 386; CH: 600028;NYSE: SNP) today announced its interim results for the six months ended 30 June 2014.

Financial Highlights:

  • In accordance with the International Financial Reporting Standards (IFRS), in the first half of 2014, the Company's turnover, other operating revenues and other income was RMB1,356.17 billion, down 4.2% year-on-year. However, the Company still maintained double digit growth in operating profit of RMB52.27 billion, up 11.8% year-on-year. Profit attributable to equity shareholders of the Company was RMB32.54 billion, up 7.5% year-on-year. Basic earnings per share were RMB0.279.
  • In accordance with the PRC Accounting Standards for Business Enterprises (ASBE), in the first half of 2014, the Company's operating profit was RMB44.83 billion, up 2.6% year-on-year. Net profit attributable to equity shareholders of the Company was RMB31.43 billion, up 6.8% year-on-year. Basic earnings per share were RMB0.269.
  • Net cash flows from operating activities was RMB582.14 billion, up 76.9% year-on-year.

  • The Board of Directors proposed an interim dividend of RMB0.09 per share.

Business Highlights:

In the first half of 2014, global economic growth slowed down while China's economy maintained moderate growth. Despite slowing growth in demand for refined oil products and tumbling prices for chemical products, the Company achieved a double digit increase in operating profit, thanks to increased production and sales volume of high quality oil products which led to a year-on-year operating profit growth in its refining and marketing businesses.

  • The Company achieved further progress in domestic oil and gas exploration and development.  Sinopec maintained its fast-track momentum in the construction of shale gas capacity in Fuling in the Sichuan Basin. By the end of June, daily shale gas production hit 3.2 million cubic meters. As of the end of 2013, the Company had completed its acquisition of overseas upstream assets from China Petrochemical Corporation, which significantly increased Sinopec's crude production on a year-on-year basis.
  • Benefitting from further optimized production structure and increased production of high value-added oil products production such as GB IV & GB V gasoline and diesel production, the refining margin rose 43.4% in the first half of 2014 on a year-on-year basis.
  • In the first half of 2014, Sinopec carried out the restructuring and reform of its marketing business as planned. The Company established Sinopec Marketing Company Ltd. and completed the auditing and evaluation of its assets, laying the foundation for marketing business reform. Sinopec established Sinopec Easy Joy Sales Co., Ltd. to take another big step in the development of its non-fuel business. Sinopec significantly increased sales of premium products and recorded 10% growth in non-fuel operating revenues through optimising marketing strategies, expanding retail scale and enhancing integrated service levels for its clients.
  • Sinopec proactively responded to the severe market conditions for the chemical industry. The Company adjusted the raw material and product structure, optimised the utilisation rate of its facilities, and shut down non-profitable units.

Fu Chengyu, Chairman of Sinopec said: "Focusing on improving the quality and efficiency of development in the first half of 2014, Sinopec has accelerated business restructuring, emphasizing market-oriented reform and the specialized development of various business lines. Sinopec is committed to building a people-oriented, world-class energy and chemical company as well as enhancing shareholders' long term returns through business transformation and more effective management."

Business Review

Exploration and Production

In the first half of 2014, Sinopec achieved further progress in oil and gas exploration and development by focusing on five key domestic areas. In exploration, the Company made further discoveries in west Sichuan, with a number of  discoveries in the west rim of the Zhungar Basin, the Qintong sag of Jiangsu Province and North Erdos. In development, Sinopec strengthened its efforts in progressive exploration and reservoir characterisation, implemented a number of projects to build oil and gas production capacity and actively carried out gas production capacity building projects in Yuanba, middle-shallow layer of west Sichuan and Daniudi. We sustained our rapid growth in conventional gas production.

In unconventional resource development, we maintained our fast track momentum in the construction of shale gas capacity in Fuling in the Sichuan Basin. By the end of June, average daily shale gas production hit 3.2 million cubic meters. As of the end of 2013, the Company had completed its acquisition of overseas upstream assets from China Petrochemical Corporation, which significantly increased its crude oil production. In the first half of 2014, our oil and gas production was 237.01 million barrels of oil equivalent, up 8.00% from the same period in 2013, of which crude oil was 177.88 million barrels, representing an increase of 7.52% from the same period last year, and natural gas output was 354.8 billion cubic meters, an increase of 9.46%.

Due to lower crude oil realisation and lower overseas sales volumes due to maintenance to our Angola project, operating revenue of the Exploration and Production segment was RMB113.8 billion, representing a decrease of 2.9% over the first half of 2013. The segment operated fairly smoothly in the first half of 2014, realising RMB28.3 billion of operating profit, down 8.7% on a year-on-year basis. This was mainly attributable to lower realized crude price caused by factors including exchange rate fluctuation.

Summary of Operations for the Exploration and Production Segment


Six-month period

ended 30 June

Change

2014

2013

%

Oil and gas production (mmboe)

237.01

219.46

8.00

Crude oil production (mmbbls)

177.88

165.44

7.52

       China

154.15

153.66

0.32

       Overseas

23.73

11.78

101.44

Natural gas production (bcf)

354.80

324.14

9.46

Refining

In the first half of 2014, we adjusted our refinery products mix in response to changes in domestic demand; optimised resource allocation and reduced procurement costs of crude oil; strengthened coordination of production and marketing to increase production and export of gasoline, jet fuel and other high-value-added products. We actively promoted quality upgrading in our oil products and significantly increased output of GB IV standard diesel. We took advantage of our centralised marketing for other oil products and increased sales of LPG, asphalt and petroleum wax. In the first half of 2014, we processed 116 million tonnes of crude oil, up 0.32% year-on-year, and increased oil product output by 2.68%, of which gasoline production was up by 9.63%, kerosene up by 19.74% and light yield up by 0.63 percentage points.

Operating revenue for the refining segment was RMB652 billion, up 1.2% year-on-year. Benefitting from further optimized production structure and increased production of high quality oil product, the segment achieved an operating profit of RMB9.8 billion in the first half of 2014, representing an increase of RMB9.5 billion over the same period of 2013, and the refining margin rose 43.4% on a year-on-year basis,

Summary of Operations for the Refining Segment   



Unit: million tonnes


Six-month period

ended 30 June

Change

2014

2013

(%)

Refinery throughput

115.81

115.44

0.32

Gasoline, diesel and kerosene production

71.62

69.75

2.68

       Gasoline

24.94

22.75

9.63

       Diesel

36.67

38.64

(5.10)

       Kerosene

10.01

8.36

19.74

Light chemical feedstock production

19.96

18.82

6.06

Light yield (%)

76.83

76.20

0.63

percentage points

Refining yield (%)

94.63

94.61

0.02

percentage points

Note: includes 100% production of joint ventures



Marketing and Distribution

In the first half of 2014, we carried out the restructuring and reform of our marketing business as planned. We established Sinopec Marketing Company Ltd. and completed the auditing and evaluation of its assets and laid the foundations for marketing business reform. We established Sinopec Easy Joy Sales Co., Ltd., as another big step towards the specialized development of our non-fuel business. In light of sufficient market supply and fierce competition, we focused on resource allocation and optimised our marketing strategies to concentrate on premium products. We focused on our customer base and the retail market, enhancing the comprehensive services at Sinopec retail stations and maximized the scale of our retail business. With the launch of our online store for refuelling cards and self-service apps and devices, we improved customer experience by providing a one-stop service. In the first half of 2014, the total sales volume of oil products grew by 0.2% to 88.26 million tonnes, of which domestic sales were 81.04 million tonnes, up 0.4% from the previous year. Retail volume increased by 1.9% to 56.55 million tonnes. Sales from our non-fuel business reached RMB7.19 billion, an increase of 10% from the same period in 2013.

Operating income of the segment was RMB726.9 billion, down 0.8% year-on-year, mainly due to the revenue drop in diesel and fuels oil. Operating profit was RMB18.8 billion, representing an increase of 11.5% over the same period of 2013.

Summary of Operations for Marketing and Distribution Segment



Unit: million tonnes


Six-month period

ended 30 June

Change

2014

2013

%

Total sales volume of oil products

88.26

88.05

0.2

Total domestic sales volume of oil products

81.04

80.75

0.4

       Retail

56.55

55.52

1.9

       Direct and wholesale

24.49

25.23

(2.9)

Annualised average throughput per station (tonne/station)

3,712

3,620

2.5






As of 30 June

2014

As of 31 December

2013

Change

from the end

of last year (%)

Total number of Sinopec-branded service stations

30,467

30,536

(0.23)

       Company-operated

30,454

30,523

(0.23)

Chemicals Business

In the first half of 2014, facing oversupply in the market, high and volatile feedstock costs and a continued decline in chemical prices, we adjusted our feedstock and product mix as well as the configuration of facilities in order to process more low-cost, light feedstock into high-value-added products. In addition, we strengthened our efforts in the research, development, production and marketing of new products, integrated production with marketing and research and optimised the utilisation rate of facilities while shutting down non-profitable units. Furthermore, we strengthened our supply-chain management to ensure stable production and sales. In the first half of 2014, ethylene production reached 5.084 million tonnes, up 5.0% from the same period in the previous year and chemical sales volume was 29.2 million tonnes, up 4.1% year-on-year.

In the first half of 2014, operating revenue of the chemicals segment was RMB213.4 billion, representing an increase of 0.9% from the same period in 2013. This was primarily due to a 6.4% year-on-year increase in the sales volume of chemical products thanks to proactive marketing activities. Fierce competition in the domestic market and decreased chemical product prices led to an operating loss of RMB4 billion for the reporting period.

Summary of Operations, Chemicals Segment                                                                 



Unit: thousand tonnes


Six-month period ended 30 June

Changes

2014

2013

(%)

Ethylene

5,084

4,841

5.0

Synthetic resin

6,965

6,730

3.5

Synthetic fiber monomer and polymer

4,105

4,539

(9.6)

Synthetic fiber

646

699

(7.6)

Synthetic rubber

483

457

5.7

Note: Includes 100% of production of joint ventures.



Capital Expenditures

The Company has focused on improving the investment quality and returns and has made progress in a number of key projects. Total capital expenditure in the first half of 2014 was RMB39.186 billion. The Exploration and Production Segment accounted for a capital expenditure of RMB20.743 billion. This was primarily for oil and gas production capacity building, including at the Shengli oil field, Tahe oil field, Yuanba and Daniudi gas fields, Fuling shale gas field, the South Yanchuan Coal-bed-methane project, the Shandong and Guangxi LNG projects as well as at natural gas pipeline projects and overseas upstream projects. The Refining Segment accounted for a capital expenditure of RMB6.592 billion, which primarily supported the completion of revamping projects at the Shijiazhuang, Yangzi, Tahe and Jiujiang refineries and for quality improvements in our oil products. The Chemicals Segment accounted for a capital expenditure of RMB4.67 billion. This was primarily used for the acquisition of equity interests in the Ningdong coal chemical project and an investment in ZhongAn coal-chemical project, as well as to support product mix adjustments and basic chemical projects including Qilu acrylonitrile and Maoming polypropylene projects. The Marketing and Distribution Segment accounted for a capital expenditure of RMB5.83 billion, which primarily supported the building and revamping of service stations and the construction of oil product pipelines and depots. We added 261 new service stations in the first half of 2014. Corporate and Others accounted for a capital expenditure of RMB1.351 billion, which primarily supported R&D facilities and IT projects.

Special Highlights

Fuling Shale Gas Project

Following the significant breakthrough in the Fuling shale gas exploration project and after trial development and appraisal, the Company has set an overall production capacity target of 10 billion cubic meters for the Fuling shale gas field, and a planned capacity of 5 billion cubic meters per year for the first phase. In accordance with the guidance of overall deployment and step-by-step development, the first project in the first phase, which is the North Block development, is scheduled for 2014. This project mainly consists of drilling 91 new wells and constructing shale gas gathering and transmission facilities. The new production capacity is expected to be 1.8 billion cubic meters for this year.

Restructuring of the Marketing Business

In the first half of 2014, the Company accelerated the restructuring of Sinopec Corp.'s marketing business. The establishment, property audit and assessment of Sinopec Marketing Company Ltd., have been completed as planned. The Capital Introduction will be subject to market conditions and will be administered with impartiality, fairness and openness. The process of Capital Introduction will be divided into two phases and will include multiple rounds of bidding and competitive negotiations. The main objectives of the Capital Introduction are to promote and optimize a modern enterprise system, improve its market-oriented operational system and management mechanism, facilitate business innovation and vitality, enhance the competitiveness and sustainability of the enterprise, promote the transformation of Sinopec Marketing from a refined oil products supplier into an integrated services provider and develop Sinopec Marketing into a comprehensive lifestyle services provider which is trusted by consumers and which satisfies the needs of the general public.

Health, Safety, Environment and Low-carbon Growth

We improved and strictly implemented our Safe Production Accountability System, implemented the Occupational Safety and Health Administration (OSHA) standard, and initiated safety inspections throughout the Company to identify potential risks and emergency response team building. As a result, we maintained safe production on the whole. The Company increased its efforts in environmental protection, energy conservation, emissions reduction, green and low-carbon growth, and initiated energy performance contracting as well as an energy management system. Our Clean Water and Blue Sky campaign is well underway and is working towards a plan of Double the Energy Efficiency. In the first half of 2014, our chemical oxygen demand (COD) in wastewater discharge fell by 3.84% year-on-year and SO2 emissions fell by 4.73% year-on-year.

Corporate Governance Improvement

During the reporting period, Sinopec Corp. has complied with the applicable securities laws and regulations in and outside mainland China and further improved its corporate governance. Throughout the restructuring of its Marketing and Distribution business, the Company has and continues to strictly following the principles of public, fair, impartial and transparent. The Company has also provided training to newly appointed members of senior management in order to support the performance of their duties. The independent non-executive directors strengthened their communication with management and the external auditors and actively participated in the on-site research and evaluation of the subsidiaries. Sinopec Corp. has actively strengthened its internal control system, which has been implemented effectively, it has organised several reverse roadshows and has achieved continued improvements in relation to the information disclosure and investor relations. The Company initiates and leads green and low carbon development, and launches Energy Conservation Campaign. Sinopec Corp. continuously acts as Chairman of UNGC China Network and proactively supports its 2014 Caring for Climate China Summit. As at the date of this report, the Company has established the Policy Concerning Diversity of Board Members aiming to help maintain rational board structure and revised the Insiders' Registration Rules for the Company aiming to strengthen the management of Insiders.

Business Prospects

In the second half of the year, we expect the global economic recovery to slow while China will maintain steady economic growth. We expect international oil prices to fluctuate at a high level during the second half of 2014. Domestic demand for oil products, especially for gasoline, is expected to grow rapidly and demand for chemicals to grow slightly.

We will focus on efficiency and profitability based on market dynamics and on safety and reliable operations. To achieve full-year production and operation targets, we will undertake initiatives in the following key areas:

In exploration and production, we will promote efficient and effective exploration in frontier areas, secure acreage for commercial development, continuously advance overseas crude oil development, and step up capacity building in Yuanba, Daniudi, middle-shallow layer of west Sichuan and Fuling shale gas projects.

In refining, we will optimise procurement and allocation of crude oil to reduce costs. We will readjust our product mix and raise the output of high-value-added products. We will continue to upgrade the quality of oil products including our GB IV highway diesel and GB V gasoline, and will strengthen the marketing of LPG, asphalt and petroleum wax.

In marketing and distribution, we will push forward the reform and restructuring of our marketing business. We will optimise resources allocation, improve business efficiency, and take full advantage of our brand and existing network to expand retail volume. We will promote market-oriented development of non-fuel and other emerging businesses, and enhance the value-creation capability of our sales network.

In chemicals, we will take advantage of integration production, and further adjust our feedstock to reduce costs, modify our product mix and unit structure through better integration of production, marketing and research to produce more marketable products. We will also strengthen business operations and marketing optimisation to further enhance marketing ability.

Appendix

Principal financial data and indicators

FINANCIAL DATA AND INDICATORS PREPARED IN ACCORDANCE WITH ASBE



Principal accounting data





Changes



over the same


Six-month periods ended 30 June

period of the


2014

2013

preceding year

Items

RMB million

RMB million

(%)





Operating income

1,356,172

1,415,244

(4.2)

Net profit attributable to equity shareholders of the Company

31,430

29,417

6.8

Net profit attributable to equity shareholders of the Company
     
after deducting extraordinary gain/loss items

31,354

29,196

7.4

Net cash flows from operating activities

58,214

32,903

76.9








Changes


At 30 June

At 31 December

from the end


2014

2013

of last year


RMB million

RMB million

(%)





Total equity attributable to equity shareholders of the Company

587,604

570,346

3.0

Total assets

1,429,543

1,382,916

3.4









Principal financial indicators





Changes



over the same


Six-month periods ended 30 June

period of the


2014

2013

preceding year

Items

RMB

RMB

(%)





Basic earnings per share

0.269

0.254

5.9

Diluted earnings per share

0.268

0.239

12.1

Basic earnings per share after deducting extraordinary

 gain/loss items

0.269

0.252

6.7

Weighted average return on net assets (%)

 

 

5.37

 

5.49

(0.12)

percentage points

Weighted average return on net assets after deducting

 extraordinary gain/loss items (%)

5.36

 

5.45

(0.09)

percentage points

Net assets per share attributable to equity shareholders

 of the Company (fully diluted)

5.031

4.687

7.3

 

 


FINANCIAL DATA AND INDICATORS PREPARED IN ACCORDANCE WITH IFRS





Principal accounting data







Changes


Six-month periods ended 30 June

over the same


2014

2013

period of the

Items

RMB million

RMB million

preceding year (%)





Operating profit

52,268

46,741

11.8

Net profit attributable to owners of the Company

32,543

30,281

7.5

Net cash generated from operating activities

58,214

32,903

76.9








Changes


As of 30 June

As of 31 December

from the end


2014

2013

of last year


RMB million

RMB million

(%)





Equity attributable to owners of the Company

586,110

568,803

3.0

Total assets

1,429,543

1,382,916

3.4









Principal financial indicators











Changes




over the same


Six-month periods ended 30 June

period of the


2014

2013

preceding year

Items 

RMB

RMB

(%)





Basic earnings per share

0.279

0.262

6.5

Diluted earnings per share

0.277

0.246

12.6

Net assets per share

5.018

4.664

7.6

Return on capital employed (%) *

 

4.19

3.88

0.31

percentage points

Return on capital employed=operating profit × (1-income tax rate)/capital employed (not annualized data)

The following table sets forth the operating revenues, operating expenses and operating profit/(loss) by each segment before elimination of the inter-segment transactions for the periods indicated, and the changes between the first half of 2014 and the first half of 2013.



Unit: RMB millions


Six-month periods ended 30 June

Change

2014

2013

(%)

Exploration and Production Segment




Operating revenues

113,827

117,242

(2.9)

Operating expenses

85,564

86,293

(0.8)

Operating profit

28,263

30,949

(8.7)

 Refining Segment




Operating revenues

651,969

644,246

1.2

Operating expenses

642,214

644,033

(0.3)

Operating profit

9,755

213

4,479.8

Marketing and Distribution Segment




Operating revenues

726,927

732,752

(0.8)

Operating expenses

708,133

715,900

(1.1)

Operating profit

18,794

16,852

11.5

Chemicals Segment




Operating revenues

213,392

211,521

0.9

Operating expenses

217,360

211,930

2.6

Operating loss

(3,968)

(409)

Corporate and others




Operating revenues

645,690

681,911

(5.3)

Operating expenses

645,951

682,925

(5.4)

Operating loss

(261)

(1,014)

Elimination of inter-segment profits

(315)

150

About Sinopec:

Sinopec Corp. is one of the largest integrated energy and chemical companies in China. Its principal operations include the exploration and production, pipeline transportation and sale of petroleum and natural gas; the sale, storage and transportation of petroleum products, petrochemical products, coal chemical products, synthetic fibre, fertiliser and other chemical products; the import and export, including an import and export agency business, of petroleum, natural gas, petroleum products, petrochemical and chemical products, and other commodities and technologies; and research, development and application of technologies and information.

Sinopec sets 'powering beautiful life' as its corporate mission, puts 'people, responsibility, integrity, precision, innovation and win-win' as its corporate core values, pursues a strategy of resources, markets, integration, international operation, differentiation, and low-carbon, and strives to achieve its corporate vision of building a world leading energy and chemical company.

Disclaimer:

This press release includes "forward-looking statements". All statements, other than statements of historical facts that address activities, events or developments that Sinopec Corp. expects or anticipates will or may occur in the future (including but not limited to projections, targets, reserve volume, other estimates and business plans) are forward-looking statements. Sinopec Corp.'s actual results or developments may differ materially from those indicated by these forward-looking statements as a result of various factors and uncertainties, including but not limited to the price fluctuation, possible changes in actual demand, foreign exchange rate, results of oil exploration, estimates of oil and gas reserves, market shares, competition, environmental risks, possible changes to laws, finance and regulations, conditions of the global economy and financial markets, political risks, possible delay of projects, government approval of projects, cost estimates and other factors beyond Sinopec Corp.'s control. In addition, Sinopec Corp. makes the forward-looking statements referred to herein as of today and undertakes no obligation to update these statements.

Investor Inquiries:

Beijing

Tel: (86 10) 5996 0028

Fax: (86 10) 5996 0386

Email: ir@sinopec.com

Media Inquiries:

 

Tel: (86 10) 5996 0028

Fax: (86 10) 5996 0386

Email: ir@sinopec.com



Hong Kong

Tel: (852) 2824 2638

Fax: (852) 2824 3669

Email: ir@sinopechk.com

Tel: (852) 3512 5000

Fax: (852) 2259 9008

Email: sinopec@brunswickgroup.com

Logo - http://photos.prnewswire.com/prnh/20140428/81089                           

 

 

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Baioo Family Interactive Limited Announces 2014 Interim Results

HONG KONG, Aug. 15, 2014 /PRNewswire/ --

Highlights of the First Half of 2014:

  • Total revenues for the six months ended 30 June 2014 were RMB287.8 million, representing a 35.0% increase from RMB213.2 million for the six months ended 30 June 2013
  • Gross profit for the six months ended 30 June 2014 was RMB208.4 million, representing a 23.8% increase from RMB168.4 million for the six months ended 30 June 2013
  • Adjusted net profit for the six months ended 30 June 2014 were RMB140.6 million, representing a 20.7% increase from RMB116.5 million for the six months ended 30 June 2014
  • Adjusted EBITDA for the six months ended 30 June 2014 were RMB160.5 million, representing a 17.8% increase from RMB136.3 million for the six months ended 30 June 2013
  • Average Quarterly Active Accounts ("QAA") reached 56.2 million, up 3.1% period-on-period
  • Average Quarterly Paying Accounts ("QPA") were 3.3 million, up 17.9% period-on-period
  • Average Quarterly Average Revenue per Quarterly Paying Accounts ("ARQPA") was RMB41.9, up 15.1% period-on-period

BAIOO Family Interactive Limited ("BAIOO" or the "Company"; stock code: 2100), China's largest online entertainment destination designed for children, today released the unaudited consolidated results for the first half of 2014 ended 30 June.

The Company's revenue for the six months ended 30 June 2014 was RMB287.8 million, representing a 35.0% increase from RMB213.2 million for the six months ended 30 June 2013. Gross profit for the six months ended 30 June 2014 was RMB208.4 million, representing a 23.8% increase from RMB168.4 million for the six months ended 30 June 2013. This was primarily benefited from revenue growth of the Company's existing major titles such as legend of Aoqi and Aola star, contributing an increase in average quarterly ARQPA.

For the six months ended 30 June 2014, all key operation metrics grew period-on-period. The average QAA for the Company's online virtual worlds including Aobi Island, Aola Star, Dragon Knights, Light of Aoya, Legend of Aoqi, Clashes of Aoqi, were approximately 56.2 million, up by 3.1% period-on-period. The average QPA for the Company's online virtual worlds was approximately 3.3 million, up by 17.9% period-on-period as a result of the increasing popularity of the Company's virtual worlds. The average quarterly ARQPA for the Company's online virtual worlds was approximately RMB41.9, up by 15.1% period-on-period which is attributed to the increase in monetization rate of the Company's virtual worlds as their popularity continued to increase.

In the first quarter of 2014, the Company launched the mobile version of Quanquan. In June 2014, the Company also launched Magic Fighter ahead of planned September release date to capture the summer season.

Mr. Billy Wu, the CEO of BAIOO, said "With the trust of both parents and children, we continue to deliver strong performance. Our existing virtual worlds continued to build momentum and our edutainment ecosystem continued to evolve with the progresses we made with WenTa, an online tutorial platform, as well as other products. I am also very pleased to see another new virtual world being added to our portfolio, which will bring more fun and edutainment experiences to our fans in China."

Outlook

In the fourth quarter of 2014, the Company plans to explore into a new genre of entertainment product targeting the young teenager market characterized by higher user stickiness and revenue per user. With the characters that have a long-lasting appeal to children, the Company is partnering with a production company to produce the first animation movie. The Company signed an agreement in which it provides the intellectual property licenses and the partner picks up all production costs. This unlocks value in the IP at minimal risk.

"We strive for leading the pre-teenage children's entertainment market as well as exploring new products into the lucrative young teenager market aged between 14-16," Billy concluded.

- End -

About BAIOO

The Company operates the largest online entertainment destination designed for children as measured by revenue in 2013. Its web portal page, 100bt.com, is a centralized platform for interactive children's content through which users can access all six of its virtual worlds and entertainment, e-learning and other products and services using one registered account. Representing its core brand values of "Dreams, Friendship and Development," BAIOO's virtual worlds and their characters have gained strong awareness among children and parents in China. As the leading provider of interactive online content for children in China, the Company has accumulated an extensive knowledge base and deep understanding of children's behavior and needs with respect to online activity and consumption. Through BAIOO's commitment to create a safe and fun environment with age-appropriate content and its understanding of children's needs, the Company's products and services have gained the trust of parents and regulators. Leveraging the Company's competitive strengths, BAIOO plans to pursue a variety of growth strategies, including increasing its addressable market, expanding its online product offerings, strengthening its brand, and continuing to execute its mobile strategy. The Company also intends to leverage its strong brand recognition, expertise in the industry and unique product development and operating model to expand into new international markets over time and is committed to maximizing shareholder value over time.

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TCL Multimedia Announces 2014 Interim Results

Profit attributable to owners of the parent was approximately HK$169 million

Gross profit margin for Q2 in the PRC Market increased to 24.0% from 18.9% of the same period last year

Speed up its transformation to become a global entertainment technology enterprise

HONG KONG, Aug. 14, 2014 /PRNewswire/ --

Highlights:

  •  For the six months ended 30 June 2014:
    • Turnover amounted to approximately HK$15,203 million, down by 15.9% year-on-year.
    • Gross profit amounted to approximately HK$2,382 million, down by 16.1% year-on-year. Operating profit was approximately HK$309 million, down by 6.6% year-on-year. 
    •  Net profit after tax from continuing operations was approximately HK$168 million, down by 13.8% year-on-year. Profit attributable to owners of the parent from continuing operations was approximately HK$169 million, down by 12.4% year-on-year.
  • For the three months ended 30 June 2014:
    • Benefited from optimization of its product mix with the launch of a series of large-sized and high-end new products, gross profit margin for the second quarter in the PRC Market increased to 24.0% (Q2 2013: 18.9%).
    • Operating loss for the Overseas Markets significantly lowered to approximately HK$12 million from approximately HK$60 million for the same period last year.
  • Continued to speed up its strategic transformation to become a global entertainment technology enterprise with the implementation of "double +" strategy:
    • Officially completed capital injection into Huizhou Kuyu Network Technology Co., Ltd. ("Kuyu") in June 2014 and gained an immediate access to the online-to-offline (O2O) platform, which ensures rapid development of electronic commerce business by operating through Kuyu's electronic commerce platform.
    • To achieve further breakthroughs in establishing recurring income streams and revenue-sharing model for its businesses, the Group launched game console T2 during the period, and jointly established a cross-industry "TCL Game TV Ecosystem Strategic Alliance" with dominant players in other industries to develop a double-screen integrated game platform. Meanwhile, the Group debuted its new product, 7V Box in July this year. Its ultimate premium appearance and control experience, the innovative cross-screen interactive function, as well as the vast volume of video game content raised the eyebrows of industry peers and consumers.
    •  Extended the "TCL-iQIYI TV+" ("TV+") product line and further enriched the TV+ platform and introduced TV+ new products.

TCL Multimedia Technology Holdings Limited ("TCL Multimedia" or "the Group", HKSE stock code: 01070) today announced its unaudited consolidated interim results for the six months ended 30 June 2014.

Performance Overview

For the six months ended 30 June 2014, the Group recorded a turnover of approximately HK$15,203 million, down by 15.9% year-on-year. Gross profit amounted to approximately HK$2,382 million, down by 16.1% year-on-year. Gross profit margin remained flat year-on-year, gross profit margin of the second quarter increased to 18.5% from 13.0%. Expense ratio remained flat year-on-year. Operating profit was approximately HK$309 million, down by 6.6% year-on-year. Net profit after tax from continuing operations was approximately HK$168 million, down by 13.8% year-on-year. Profit attributable to owners of the parent from continuing operations was approximately HK$169 million, down by 12.4% year-on-year. During the period, the Group recorded a one-off gain of approximately HK$159 million from the closure of certain subsidiaries. The Group's basic earnings per share and basic earnings per share from continuing operations were HK12.78 cents and HK12.78 cents, respectively (Basic earnings per share and basic earnings per share from continuing operations in the same period of 2013: HK19.11 cents and HK14.51 cents, respectively).

For the first half of 2014, the Group sold a total of 7.56 million sets of LCD TVs, down by 2.0% year-on-year. The Group sold 3.56 million sets of LCD TVs in the PRC Market, down 21.7% year-on-year, and 4.00 million sets of LCD TVs in the Overseas Markets, up 26.1% year-on-year, of which the sales volume of LCD TVs in the Strategic OEM business grew by 109.1% year-on-year to 1.38 million sets. According to the latest DisplaySearch report, in the first quarter of 2014, the Group ranked No.5 in the global LCD TV market with a market share of 5.4%. Meanwhile, the Group ranked No.3 in the PRC LCD TV market with a market share of 16.0%.

The PRC Market

Due to the continuing weak market demand, delays in launches of new products in the first quarter as well as the withdrawal of energy saving home appliances subsidy policy in the end of May last year, the sales volume in the PRC Market was below expectations. Nevertheless, the Group continued to optimize its product mix with the launch of a series of large-sized and high-end new products, resulting in a significant improvement in its results for the second quarter. The gross profit margin for the second quarter in the PRC Market increased to 24.0% from 18.9% of the same period last year, up by 5.1 percentage points year-on-year.

In the first half of 2014, the Group launched a total of 26 new products in 8 series, including 13 models of 4K ultra high-definition TVs, covering medium-sized, large-sized and extra-large-sized screen products ranging from 40 inches to 65 inches. These products contributed to 50% of total number of new products launched. During the period under review, the Group extended the "TCL-iQIYI TV+" product line and completed product enrichment of the large-sized 4K ultra high-definition TVs and smart TVs. Among which, new products including "A71" series and Game TV became the top seller within a short period after launch and was highly appreciated by the market, while proportion of sales volume of large-sized products also increased gradually. The sales volume of the smart TVs increased to 1.28 million sets from 1.04 million sets for the same period of last year, contributing to 36.0% of the total LCD TV sales volume in the PRC Market.

In March 2014, the Group, in a cross-industry move, jointly established a "TCL Game TV Ecosystem Strategic Alliance" with China Unicom Broadband, ATET, JD.com and Gameloft to develop a double-screen integrated game platform. Game TV, E5700, E6700 and TCL game console T2 were well received by the market after their launch. As an important step of entering into the game industry by the Group, the Group expects the game product series will become a new business growth driver, and will coordinate with the Group's internet-oriented and entertainment-oriented transformation, exploring the blue ocean in the game entertainment market.

Moreover, the Group and IMAX Corporation ("IMAX") jointly signed with Wasu in April 2014 an agreement in relation to the content distribution for premium home theatres. Wasu is authorised to distribute premium digital audio-visual contents of the PRC and Hollywood movie titles on the system platform of premium home theatres of TCL-IMAX Entertainment Co., Limited, a joint venture set up by TCL and IMAX.

The Overseas Market

The Group's Overseas Markets achieved steady growths both in turnover and operating results. During the first half of 2014, the sales volume of LCD TVs increased by 26.1% year-on-year to 4.00 million sets, mainly due to proactive adjustment of its product mix focusing on large-sized products, 4K ultra high-definition TVs and smart TVs. During the period, turnover in the Overseas Markets increased by 8.2% year-on-year to HK$6,003 million and gross profit margin increased to 10.7% from 8.0% for the same period last year, up by 2.7 percentage points year-on-year. The overall sales volume and the contribution from middle- to large-sized products to the total sales volume fell short of expectations, resulting in a loss of approximately HK$12 million for the second quarter, significantly lower than approximately HK$60 million loss for the same period last year.

Sales volume of LCD TVs in the Emerging Markets reached 2.07 million sets during the period under review, which remained flat compared to the same period last year. The sales volume of the LCD TVs in the Strategic OEM business increased by 109.1% year-on-year, while the sales volume of LCD TVs in European and North American Markets recorded growths of 11.3% and 203.4%, respectively.

The Group hosted intensively various launching events for new products in the Emerging Markets. These, together with its global entertainment marketing activities with the movie "X-Men: Days of Future Past" and the full rollout of social media marketing initiatives, helped enhancing the TCL brand globally and proactively drove product marketing. In the European Markets, the Group actively cooperated with major retail chains comprehensively, resulting in a higher proportion of sales volume of large-sized smart TVs. Also, the Group ranked No.3 in the ultra high-definition TVs market in France, according to GfK figure with a market share of 11.6%. In the North American Market, the Group has not only reinforced its strategic cooperation with Amazon, but has also actively explored other sales channels, including leading US retailers such as Sam's Club, etc., driving a significant increase in LCD TV sales volume in that market.

Outlook

Looking ahead to the second half of 2014, the Group will persistently enrich the product line for the PRC Market in the second half of the year, and continue to deepen sales channel and organizational reforms to flatten its enterprise structure further in order to boost its terminal sales capability and agility to changes in the market. The Group joined forces with "The Voice of China", the hottest professional music show in the PRC, and announced TCL to be the "exclusive collaborative partner from the TV industry for The Voice of China – Season 3" in July 2014, accelerating the rapid rise of the popularity of TV+, a great step for transforming into an entertainment enterprise.

In addition, in the same month, the Group participated in the 12th China Digital Entertainment Expo & Conference (China Joy) in Shanghai, the PRC. The Group joined forces with China Unicom Broadband and ATET again and announced the establishment of the largest Game TV ecosystem in the PRC, with renowned game developers including Gameloft, JJ International Company, Rovio, Marmalade, Cyberfront Korea, J-FLOW to be enrolled to "TCL Game TV Ecosystem Strategic Alliance", as a move to further facilitate the all-round development of the ecosystem. Meanwhile, the Group debuted its new product, 7V Box in China Joy, with its ultimate premium appearance and control experience, the innovative cross-screen interactive function, as well as the vast volume of video game content raised the eyebrows of industry peers and consumers. The Group strives to enhance its product capabilities for the new businesses, such as games and OTT etc., so as to achieve further breakthroughs in establishing recurring income streams and revenue-sharing model for its businesses.

For the Overseas Markets, the Group will seek to drive sales growth with a combination of product resources, screen strategies and pricing, achieve breakthroughs for the TCL brand in key market and proactively exploit synergies with other businesses of TCL Corporation ("TCL Corporation"). TCL branded products like mobile phones and air conditioners etc. will be introduced in markets like Southeast Asia, etc., to raise the overall TCL brand influence in overseas.

Mr. Hao Yi, Chief Executive Officer of TCL Multimedia said, "We launched the 'double +' strategic transformation in February this year which is the combination of 'intelligence + internet' and 'products + services', marking TCL's new business model from the product-oriented approach to a product-and-user-oriented approach and unveils our internet-oriented road. On one hand, we will step up the establishment of an internet ecosystem by cementing our hardware business and enhancing our horizontal alliances, deepening cross-industry strategic cooperations in other areas. On the other hand, we will strengthen our business layout along the 4 smart service platforms including video platform, game platform, education platform and living platform, providing users a comprehensive entertainment solution. We will fully capitalize on TCL Corporation's resource advantages and implement 'double +' strategic transformation, gradually transforming into a global entertainment technology enterprise and bringing long-term value and returns to its shareholders."

The Group's sales volume of TVs by regions during the period under review is as follows:


1H 2014

1H 2013

Change


('000 sets)

('000 sets)


LCD TVs

7,557

7,715

(2.0%)

of which: LED backlights LCD TVs

7,558

7,328

+3.1%

Smart TVs 

1,412

1,138

+24.1%

3D TVs

837

1,335

(37.3%)

-        PRC Market

3,557

4,542

(21.7%)

-        Overseas Market

4,000

3,173

+26.1%

~ End ~

About TCL Multimedia

Headquartered in China, TCL Multimedia Technology Holdings Limited (HKSE stock code: 01070) is one of the leading players in the global TV industry, engaged in the research and development, manufacturing and distribution of consumer electronic products. Through a new product-and-user-oriented business model that focuses primarily on a "double +" strategy which includes "intelligence + internet" and "products + services" as the main direction, striving to become a global entertainment technology enterprise that provides integrated entertainment solution to customers. According to the latest DisplaySearch report, the Group ranked No.5 in the global LCD TV market with a market share of 5.4% in the first quarter of 2014. The Group ranked No.3 in the PRC LCD TV market with a market share of 16.0%.

For more information, please visit its website: http://multimedia.tcl.com

To see the full version of this release, including financial tables, click here: http://photos.prnasia.com/prnk/20140814/8521404591

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SMIC Reports 2014 Second Quarter Results

SHANGHAI, Aug. 6, 2014 /PRNewswire/ -- Semiconductor Manufacturing International Corporation (NYSE: SMI; SEHK: 981) ("SMIC" or the "Company"), one of the leading semiconductor foundries in the world, today announced its consolidated results of operations for the three months ended June 30, 2014.

Second Quarter 2014 Highlights

  • Revenue was $511.3 million in 2Q14, an increase of 13.4% quarter over quarter.
  • Non-GAAP revenue excluding wafer shipments from Wuhan Xinxin reached a record high of $511.3 million in 2Q14, an increase of 1.9% year over year compared to $501.8 million in 2Q13.
  • Gross margin was 28.0% in 2Q14, compared to 21.3% in 1Q14.
  • Profit for the period attributable to SMIC was $56.8 million in 2Q14, compared to $20.3 million in 1Q14.
  • China-region revenue grew to 44.4% of overall revenue becoming the largest contributor to revenue regionally in 2Q14.

Third Quarter 2014 Guidance:

The following statements are forward looking statements which are based on current expectations and which involve risks and uncertainties, some of which are set forth under "Safe Harbor Statements" below.

  • Revenue is expected to increase 1% to 5% quarter over quarter.
  • Gross margin is expected to range from 24% to 26%.

Non-GAAP operating expenses excluding the effect of employee bonus accrual, government funding and gain from the disposal of living quarters are expected to range from $96 million to $101 million.

Dr. Tzu-Yin Chiu, SMIC's Chief Executive Officer and Executive Director, commented, "Excluding Wuhan's contribution, SMIC achieved record high revenue in the second quarter, which is our ninth consecutive profitable quarter. We reached a gross margin of 28%--our highest since 2005.

Compared to Q1 2014, utilization was up more than 10 percentage points; while revenue increased 13.4% sequentially. When comparing Q2 2014 to Q1 2014, gross margin increased 6.7 percentage points, profit from operations nearly doubled, and net profit tripled. We continue to emphasize the priority of sustained profitability and carefully planned growth. Overall, we are optimistic about 2015 as we prepare our capacity and technology for many new and exciting opportunities.

One of our growth drivers for 2015 will be 28nm. We are happy to work with our long-time customer as we ramp up this new technology. We are on track to have production ramp up in 2015. We are also working with other customers who are targeting to capture the LTE handset IC market in China, AP for tablets, and RF applications on 28nm.

Our other growth driver for this year and more so in 2015 is our differentiated product offering. SMIC continues to experience high demand for 8-inch production capacity for PMIC, CIS, e-NVM, and sensors. Our effort in 12-inch specialty process development has recently yielded the industry's leading 55nm embedded NVM solution. Our customer has entered into high volume production based on this technology.

The strong IC demand in China is continuing to drive our growth. For the first time in SMIC's history, our China revenue has exceeded all other regions in the second quarter. Revenue from China now accounts for more than 44% of our total revenue.

The second quarter recovery ended with strong financials and profitability for SMIC. We are optimistic about 2015 as we prepare for growth on 8-inch and 28nm. We continue to have confidence in our strategy to capture growth opportunities in China."

Conference Call / Webcast Announcement

Date: August 7, 2014



Time: 8:30 a.m. Shanghai time






Dial-in numbers and pass code:






China

400-620-8038

(Pass code: SMIC)

Hong Kong

852-2475-0994

(Pass code: SMIC)

Taiwan

886-2-2650-7825

(Pass code: SMIC)

United States, New York

1-845-675-0437

(Pass code: SMIC)

The call will be webcast live with audio at http://www.smics.com/eng/investors/ir_presentations.php or http://www.media-server.com/m/p/89si7vqg.

An archived version of the webcast, along with an electronic copy of this news release will be available on the SMIC website for a period of 12 months following the webcast.

About SMIC

Semiconductor Manufacturing International Corporation ("SMIC"; NYSE: SMI; SEHK: 981) is one of the leading semiconductor foundries in the world and the largest and most advanced foundry in mainland China. SMIC provides integrated circuit (IC) foundry and technology services at 0.35-micron to 28-nanometer. Headquartered in Shanghai, China, SMIC has a 300mm wafer fabrication facility (fab) and a 200mm mega-fab in Shanghai; a 300mm mega-fab in Beijing with a joint-venture 300mm fab that is currently under construction; a 200mm fab in Tianjin; and a 200mm fab project under development in Shenzhen. SMIC also has marketing and customer service offices in the U.S., Europe, Japan, and Taiwan, and a representative office in Hong Kong.

For more information, please visit www.smics.com .

Safe Harbor Statements

(Under the Private Securities Litigation Reform Act of 1995)

This press release contains, in addition to historical information, "forward-looking statements" within the meaning of the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements, including statements under "Third Quarter 2014 Guidance" and the statements regarding our optimism about our 2015 opportunities, our expected 2015 growth driver of 28nm technology, our expectation to have production ramp up in 2015, our expectation of differentiated products offering being another growth driver for this year and more so in 2015, our anticipation to experience high demand for 8-inch production capacity for PMIC, CIS, e-NVM, and sensors and our confidence in our strategy to capture growth opportunities in China, as well as the statements regarding future 2014 capital expenditures are based on SMIC's current assumptions, expectations and projections about future events. SMIC uses words like "believe," "anticipate," "intend," "estimate," "expect," "project," "target" and similar expressions to identify forward-looking statements, although not all forward-looking statements contain these words. These forward-looking statements involve significant risks, both known and unknown, uncertainties and other factors that may cause SMIC's actual performance, financial condition or results of operations to be materially different from those suggested by the forward-looking statements including, among others, risks associated with the global economic slowdown, orders or judgments from pending litigation and financial stability in end markets.

Investors should consider the information contained in SMIC's filings with the U.S. Securities and Exchange Commission (SEC), including its annual report on 20-F filed with the SEC on April 14, 2014, especially the consolidated financial statements, and such other documents that SMIC may file with the SEC or The Hong Kong Stock Exchange Limited ("SEHK") from time to time, including current reports on Form 6-K. Other unknown or unpredictable factors also could have material adverse effects on SMIC's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this press release. Except as may be required by law, SMIC undertakes no obligation and does not intend to update any forward-looking statement, whether as a result of new information, future events or otherwise.

About Non-Generally Accepted Accounting Principles ("Non-GAAP") Financial Measures

To supplement SMIC's consolidated financial results presented in accordance with IFRS, SMIC uses in this press release measures of operating results that are adjusted to exclude wafer shipments from Wuhan Xinxin Semiconductor Manufacturing Corporation ("Wuhan Xinxin"), which SMIC began gradually phasing out in 3Q13. There were no wafer shipments from Wuhan Xinxin from 1Q14 onwards. This earnings release includes non-GAAP revenue, non-GAAP cost of sales, non-GAAP gross margin and non-GAAP operating expenses, which consists of total operating expenses as adjusted to exclude the effect ofemployee bonus accrual, government funding and gain from the disposal of living quarters. It also includes third quarter 2014 guidance for non-GAAP operating expenses. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with IFRS.

SMIC believes that use of these non-GAAP financial measures facilitates investors' and management's comparisons to SMIC's historical performance. The Company's management regularly uses these non-GAAP financial measures to understand, manage and evaluate the Company's business and make financial and operational decisions.

The accompanying table has more information and reconciliations of each non-GAAP financial measure to its most directly comparable GAAP financial measure. A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis.

For the full version of SMIC's second quarter financial results, please see:
http://photos.prnasia.com/prnk/20140806/0861405533-a

Contact:

Investor Relations

+86-21-3861-0000 ext. 12804

ir@smics.com

 

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