China Weaving Materials : Results Announcement For The Six Months Ended 30 June 2017

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CHINA WEAVING MATERIALS HOLDINGS LIMITED 中 國 織 材 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock code: 3778)

RESULTS ANNOUNCEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2017

The board (the "Board") of directors (the "Directors") of China Weaving Materials Holdings Limited (the "Company") announces the unaudited condensed consolidated results of the Company and its subsidiaries (the "Group") for the six months ended 30 June 2017 together with the comparative figures for the corresponding period in 2016 as follows:

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME Six months ended 30 June

Note	2017 (unaudited) RMB'000	2016 (unaudited) RMB'000
Revenue	4	706,394	631,296
Cost of sales	(643,918)	(577,741)
Gross profit	62,476	53,555
Other income	5	11,428	5,624
Other gains and losses	6	16,618	450
Distribution and selling expenses	(11,680)	(11,394)
Administrative expenses	(24,426)	(21,770)
Finance costs	(29,531)	(23,272)
Profit before tax	24,885	3,193
Income tax expense	7	(4,704)	(2,031)
Profit and total comprehensive income
for the period	8	20,181	1,162
Profit and total comprehensive income for the period attributable to:
Owners of the Company	22,319	1,486
Non-controlling interests	(2,138)	(324)
20,181	1,162
Earnings per share	10
Basic	RMB1.78 cents	RMB0.12 cents
Diluted	RMB1.14 cents	RMB0.12 cents

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Note	30 June 2017 (unaudited) RMB'000	31 December 2016 (audited) RMB'000
Non-current assets Property, plant and equipment	1,092,545	1,106,576
Prepaid lease payments	43,802	44,347
Intangible asset Deposits on acquisition of property, plant and equipment	42 492	67 53
Goodwill	34,829	34,829
Deferred tax assets	2,416	2,465
1,174,126	1,188,337
Current assets Inventories	260,993	137,153
Trade and other receivables	11	28,387	53,597
Bills receivable	18,840	12,614
Prepaid lease payments	1,090	1,090
Pledged bank deposits	52,438	61,571
Restricted bank deposit	500	500
Cash and bank balances	44,796	93,443
407,044	359,968
Current liabilities Trade and other payables	12	390,439	233,792
Bills payable	34,760	52,148
Deferred income	227	227
Finance lease payable Financial liabilities at fair value through profit or loss	3,488 1,326	4,125 -
Bank borrowings	424,827	498,729
Notes payable	-	705
Liability component of convertible bond	1,087	1,128
Derivative component of convertible bond	36,361	50,853
Current tax liabilities	7,717	10,276
900,232	851,983
Net current liabilities	(493,188)	(492,015)
Total assets less current liabilities	680,938	696,322

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

(Continued)

30 June 2017 (unaudited) RMB'000	31 December 2016 (audited) RMB'000
Non-current liabilities Consideration payables	-	42,963
Deferred income	7,823	7,937
Bank borrowings	65,840	20,260
Notes payable	-	44,729
Liability component of convertible bond	74,266	68,289
Deferred tax liabilities	19,284	18,600
167,213	202,778
NET ASSETS	513,725	493,544
Capital and reserves Share capital	101,989	101,989
Reserves	381,887	359,568
Equity attributable to owners of the Company	483,876	461,557
Non-controlling interests	29,849	31,987
TOTAL EQUITY	513,725	493,544

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL INFORMATION

For the six months ended 30 June 2017

1. BASIS OF PREPARATION

   This unaudited condensed consolidated financial information has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" issued by the International Accounting Standards Board ("IASB") and the applicable disclosures required by the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

   The Group continues to adopt the going concern basis in preparing its condensed consolidated financial information. At 30 June 2017, the Group had net current liabilities of approximately RMB493,188,000. The condition indicates the existence of a material uncertainty which may cast significant doubt on the Group's ability to continue as a going concern and therefore the Group may be unable to realise its assets and discharge its liabilities in the normal course of business. Notwithstanding the above, the condensed consolidated financial information has been prepared on a going concern basis as the directors of the Company have given careful consideration to the impact of the current and anticipated future liquidity of the Group and are satisfied that:

2. The banking facilities from the Group's bankers for its working capital requirements for the next twelve months will be available as and when required, having regard to the following:

3. Up to the date of the condensed consolidated financial information was authorised for issue, the Group' s bankers agreed to renew bank borrowings amounting to approximately RMB406,100,000 currently included in current liabilities at 30 June 2017.

4. Undrawn banking facilities amounting to approximately RMB37,402,000.

5. Subsequent to the reporting date, the Group has also successfully obtained new banking facilities of approximately RMB58,117,000.

6. Certain existing prepaid land lease and property, plant and equipment can be offered as security for further financing.

7. The Group is able to generate sufficient operating cash flows to meet its current and future obligations.

Having taken into account the above, the directors consider that the Group will have sufficient financial resources to meet in full its working capital requirements and financial obligations as and when they fall due in the foreseeable future. Accordingly, the condensed consolidated financial information has been prepared on a going concern basis.

Should the Group be unable to continue as a going concern, adjustments would have to be made to restate the values of the assets to their recoverable amounts, to provide for any further liabilities which might arise and to classify non-current assets and liabilities as current assets and liabilities respectively. The effects of these potential adjustments have not been reflected in this condensed consolidated financial information.