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2007

2007. Annual Results Announcement. Agenda. Business Structure Results Highlights Review of Operations Outlook: Entering the Second Venture with Steady Growth. 1. Business Structure. Nanjing Section of Nanjing-Lianyungang Highway. Jiangsu Section of

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2007

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  1. 2007 Annual Results Announcement

  2. Agenda • Business Structure • Results Highlights • Review of Operations • Outlook: Entering the Second Venture with Steady Growth 1

  3. Business Structure Nanjing Section of Nanjing-Lianyungang Highway Jiangsu Section of Shanghai-Nanjing Expressway Shanghai-Nanjing Section of G312 100% 100% 100% Jiangsu Ninghu Investment Development Co., Ltd. Jiangsu Sundian Engineering Co., Ltd. Jiangsu Guangjing Xicheng Expressway Co., Ltd. 95% 70% 85% Jiangsu Kuailu Bus Transportation Co., Ltd. Jiangsu Yangtze Bridge Co., Ltd. Suzhou Sujiahang Expressway Co., Ltd. 33.2% 26.66% 33.33% * During the reporting period, the Company conducted share transfer and capital increase with Jiangsu Sundian Engineering Co., Ltd. and the relevant share transfer and capital increase agreements took effect on 1 January 2008. During the year, Jiangsu Sundian Engineering Co., Ltd. remained as a subsidiary within the scope of  consolidation of the Company's financial statements.

  4. 2007 Annual Results Announcement Results Highlights

  5. Major Achievements in 2007 • The 8-lane Shanghai-Nanjing Expressway achieved stable growth, with its traffic volume and toll revenue setting historic highs • Operating measures regarding road operation, financing, project control and management enhancement were effectively implemented, thereby enhancing the Group’s operations across the board • Enhancing service quality and improving the operation tolling system, innovating the on-site management mechanisms so as to maintain a solid operation order • Exploring different financing channels through the issuance of the short-term trust and initiating the corporate bond issue application, with a view to lowering finance costs and enhancing profitability • Rationalizing the Company’s assets and completing the disposal of properties and the transfer of equity interests in subsidiaries

  6. Financial Highlights Under HKFRS

  7. Financial Highlights (Cont’d) Revenue (net) and Profit Net Revenue Net Profit RMB ‘000 5,068,913 3,925,569 2,951,996 2,675,814 2,104,904 1,642,331 1,174,111 1,005,773 979,391 668,028 For the year ended 31st December

  8. Major Reasons for Growth Nanjing+15.6% Zhenjiang+15.5% Changzhou+15.6% Wuxi+15.3% Suzhou+16.0% • Continued economic growth GDP Growth Rate: 2007 China : +11.4% Jiangsu+14.8% Increase in Travels • Strong GDP growth in Jiangsu Province • Even stronger growth rates in the 5 cities 7 7

  9. Major Reasons for Growth (Cont’d) • Significant increase in automobile ownership in Jiangsu Province • Automobile ownership :3.301million (+18.91%) • Rapid development of the transportation sector • Passenger transportation：+16.0% • Cargo transportation：+14.9% • Improving expressway network • Total expressway mileage: 3,558 km (+203km) • Toll road polices remained stable 8

  10. Revenue Breakdown Nangjing-Lianyungang Highway 1.18% Guangjing-Xicheng Expressway 10.77% Shanghai-Nanjing Section of G312 3.34% Auxiliary Services 18.82% 64.26% Shanghai-Nanjing Expressway 1.63% Other Operations

  11. 2007 Annual Results Announcement Review of Operations

  12. Operating Performance Review Under HKFRS

  13. Shanghai-Nanjing Expressway • The second year since the 8-lane expressway’s full opening, realized a total toll revenue of RMB3.4 billion • Daily traffic volume: +22.57% • Daily toll revenue: +33.05% • Reasons for increase： • Organic growth • Lower comparison basis in 2006 • Increase of proportion of trucks • The assumption of traffic diverted from Jiangyin Yangtze Bridge 12

  14. Shanghai-Nanjing Expressway (Cont’d) • Average daily truck traffic: 33.7% of total traffic+4.55 percentage point YoY • Average daily toll revenue from trucks: 52.93% of total revenue+5.86percentage point YoY

  15. Shanghai-Nanjing Section of G312 • Certain truck traffic continued to divert to Shanghai-Nanjing Expressway toll revenue further decreased • Average daily tolled traffic volume:29,184 vehicles (-7.84%) • Average daily toll revenue:RMB486,200 (-12.74%)

  16. Nanjing Section of Nanjing-Lianyungang Highway • Impact of traffic diversions caused by Nanjing-Lianyungang Expressway was at its full extent during the year • Average daily traffic volume: -47.24％ • Average daily toll revenue: -39.24％ • Nanjing-Lianyungang Expressway caused diversions of primarily passenger vehicles Decrease in revenue <Decrease in traffic • Toll revenue accounted for only 1.18% of the Group’s total revenue, so the future growth of the Group’s results will not be hindered

  17. Guangjing Xicheng Expressways • Maintenance works at Jiangyin Yangtze Bridge and at Jiangyin South Viaduct of Xicheng Expressway truck traffic was prohibited Aug - Sept 2007 affected traffic on Guangjing Expressway and Jiangyin Yangtze Bridge • Certain sections of Xicheng Expressway were affected as well • During the traffic control period, diversions caused a growth in truck traffic proportion and toll revenue on Shanghai-Nanjing Expressway, thereby offsetting the toll revenue losses

  18. Sujiahang Expressway • Increasing the proportion of trucks, broadening the source of revenue • average daily full-trip traffic: 21,387 vehicles (+14.86%) • average daily toll revenue: RMB 1.63 million (+10.01%) • In April 2008, Sutong Bridge will be open to traffic facilitate traffic volume growth for Sujiahang Expressway 17

  19. Auxiliary Services • Revenue growth mainly attributable to customer growth at service areas • Revenue: RMB999,279,000 (+62.80%) • Petroleum product sales: RMB857,142,000(+70.36%) 18

  20. 2007 Annual Results Announcement Outlook：Entering the Second Venture with Steady Growth

  21. Social automobile ownership will maintain rapid growth, driven by economic development • Income tax rate adjustment in 2008 provides room for profit growth • The Group’s major toll road and bridge projects are still in the growing stage Outlook 2008 Operating Environment • Overall trend of the economy is positive. As a sector highlighted for prioritized development under the Eleventh Five-year Plan, the transportation sector maintains a development edge.

  22. Outlook (Cont’d) 2008 Operating Environment (Cont’d) • Ever-improving road networks will lead to re-allocation of overall traffic volume, making potential diversion and competition inevitable. • After the defect liability stage, the newly-constructed road assets will enter the normal maintenance stage, which will gradually increase maintenance costs. • Bank loan interest rates are expected to be increasing during the rate increase cycle, and the Company’s relatively high gearing will be exposed to rising finance costs. 21

  23. Maintaining stable revenue growth to ensure stable returns to shareholders • Maintaining good road quality and service standards to ensure safe and smooth traffic on the roads • Reducing finance costs and expenses and preventing market interest rate risks Business development Management enhancement Financial management Business operation Road operation Outlook (Cont’d) 2008 Strategic Development Objectives • Improving the internal management system and procedures to raise the standards of regulated and refined management • Actively seeking market opportunities to timely enhance the Company’s development potential

  24. Outlook (Cont’d) • Strengthening the effort on toll collection management; brand-building service areas to increase operating revenue of service areas; exercising cost controls and enhance profitability • Completing the late-stage tasks of the expansion project; reinforcing the management of road operation order; carrying out good road maintenance ; providing good traffic conditions to facilitate rapid growth in traffic volume • Actively moving forward the corporate bonds and short-term commercial papers work, arranging a considerable proportion of fixed rate liabilities, so as to reduce finance costs and expenses Management enhancement Business development Business operation Financial management Road operation 2008 Major Measures • Improving and enhancing various management systems and procedures by fully implementing the internal control management , so as to enhance the standards of regulated and refined management • Proactively initiating studies on investment in order to seek feasible projects, enhancing the Company’s development potential and searching for new sources of profit growth 23

  25. 2007 Annual Results Announcement Thank You

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