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3 Contents 目錄 Corporate Information 2 公司資料 Definitions 5 釋義 Financial Highlights 8 財務摘要 Management Discussion and Analysis 9 管理層討論及分析 Disclosure of Interests 21 披露權益資料 Corporate Governance 26 企業管治 Interim Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income 31 中期簡明合併損益及其他綜合收益表 Interim Condensed Consolidated Balance Sheet 33 中期簡明合併資產負債表 Interim Condensed Consolidated Statement of Changes in Equity 36 中期簡明合併權益變動表 Interim Condensed Consolidated Statement of Cash Flows 38 中期簡明合併現金流量表 Notes to the Interim Condensed Consolidated Financial Information 40 中期簡明合併財務資料附註

4 Corporate Information BOARD OF DIRECTORS Executive Directors Ms. Li Bo (Chairperson) Mr. Yu Long (Vice-chairman, General Manager) Ms. Ling Hui Non-executive Directors Mr. Dai Richeng Mr. Chen Yong Mr. Liu Hui Independent Non-executive Directors Mr. Liu Shuen Kong Mr. Zhong Wei Mr. Zhou Beihai AUDIT COMMITTEE Mr. Liu Shuen Kong (Chairman) Mr. Zhong Wei Mr. Zhou Beihai REMUNERATION COMMITTEE Mr. Zhong Wei (Chairman) Mr. Yu Long Mr. Zhou Beihai NOMINATION COMMITTEE Ms. Li Bo (Chairperson) Mr. Zhou Beihai Mr. Zhong Wei COMPLIANCE COMMITTEE Mr. Zhong Wei (Chairman) Mr. Yu Long Mr. Liu Shuen Kong Mr. Zhou Beihai Mr. Huang Yi (Supervisor) COMPANY SECRETARY Mr. Li Bo 李波女士 ( 董事長 ) 于龍先生 ( 副董事長 總經理 ) 凌慧女士 戴日成先生陳勇先生劉暉先生 廖船江先生鐘偉先生周北海先生 廖船江先生 ( 主席 ) 鐘偉先生周北海先生 鐘偉先生 ( 主席 ) 于龍先生周北海先生 李波女士 ( 主席 ) 周北海先生鐘偉先生 鐘偉先生 ( 主席 ) 于龍先生廖船江先生周北海先生黃軼先生 ( 監事 ) 李博先生 2 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

5 Corporate Information AUTHORISED REPRESENTATIVES Mr. Yu Long Ms. Ling Hui HEADQUARTER AND PRINCIPAL PLACE OF BUSINESS IN THE PEOPLE S REPUBLIC OF CHINA ( PRC ) Yunnan Water 2089 Haiyuan Bei Road Gaoxin District Kunming, Yunnan PRC PRINCIPAL PLACE OF BUSINESS IN HONG KONG Suite , 31/F, Tower 1, The Gateway Harbour City, 25 Canton Road Tsim Sha Tsui, Kowloon Hong Kong H SHARE REGISTRAR Tricor Investor Services Limited Level 54, Hopewell Centre 183 Queen s Road East Wanchai Hong Kong LEGAL ADVISERS As to Hong Kong law: Jingtian & Gongcheng LLP Suites , 32/F., Edinburgh Tower The Landmark 15 Queen s Road Central Hong Kong As to PRC law: Jia Yuan Law Offices 4th Floor Ocean Plaza 158 Fuxing Men Nei Street Xicheng District, Beijing PRC 于龍先生 凌慧女士 中國 雲南昆明 高新技術開發區 海源北路 2089 號 雲南水務 香港九龍 尖沙咀廣東道 25 號海港城 港威大廈第 1 座 31 樓 室 H 卓佳證券登記有限公司 香港灣仔 皇后大道東 183 號 合和中心 54 樓 競天公誠律師事務所有限法律責任合夥 香港 中環皇后大道中 15 號 置地廣場 公爵大廈 32 樓 室 嘉源律師事務所 中國北京 西城區 復興門內大街 158 號 遠洋大廈 4 層 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 3

6 Corporate Information PRINCIPAL BANKERS China Construction Bank Corporation Industrial Bank Co., Ltd. China Development Bank Agricultural Development Bank of China Industrial and Commercial Bank of China Limited Agricultural Bank of China Limited Bank of Communications Co., Ltd. Shanghai Pudong Development Bank Co., Ltd. China CITIC Bank Corporation Limited China Everbright Bank AUDITOR PricewaterhouseCoopers Certified Public Accountants and Registered Public Interest Entity Auditor 22/F, Prince s Building Central Hong Kong STOCK CODE 6839 COMPANY S WEBSITE 中國建設銀行股份有限公司興業銀行股份有限公司國家開發銀行中國農業發展銀行中國工商銀行股份有限公司中國農業銀行股份有限公司交通銀行股份有限公司上海浦東發展銀行股份有限公司中信銀行股份有限公司中國光大銀行 羅兵咸永道會計師事務所執業會計師及註冊公眾利益實體核數師香港中環太子大廈 22 樓 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

7 Definitions In this interim report, unless the context otherwise requires, the following expressions shall have the following meanings: 於本中期報告內, 除文義另有所指外, 下列詞彙具有以下涵義 : Acting in Concert Parties 一致行動人士 Articles of Association 公司章程 associate(s) 聯繫人 Beijing OriginWater 北京碧水源 Board or Board of Directors 董事會 Company 本公司 connected person(s) 關連人士 controlling shareholder(s) 控股股東 Corporate Governance Code 企業管治守則 Director(s) 董事 Domestic Share(s) 內資股 Mr. Liu Xujun, Mr. Huang Yunjian and Mr. Wang Yong, members of the senior management of the Company 本公司高級管理層成員劉旭軍先生 黃雲建先生及王勇先生 the articles of association of the Company 本公司的組織章程細則 has the meaning ascribed to it under the Listing Rules 具有上市規則賦予該詞的涵義 Beijing OriginWater Technology Co., Ltd.*( 北京碧水源科技股份有限公司 ), a limited liability company established in the PRC, the shares of which are listed on the Shenzhen Stock Exchange (stock code:300070) 北京碧水源科技股份有限公司, 於中國成立的股份有限公司, 其股份在深圳證券交易所上市 ( 股份代號 :300070) the board of Directors of the Company 本公司的董事會 Yunnan Water Investment Co., Limited*( 雲南水務投資股份有限公司 ), a joint stock limited liability company established in the PRC, the H Shares of which are listed on the Main Board of the Stock Exchange (stock code:6839) 雲南水務投資股份有限公司, 於中國註冊成立的股份有限公司, 其 H 股在聯交所主板上市 ( 股份代號 :6839) has the meaning ascribed to it under the Listing Rules 具有上市規則賦予該詞的涵義 has the meaning ascribed to it under the Listing Rules 具有上市規則賦予該詞的涵義 the Corporate Governance Code and Corporate Governance Report, as set out in Appendix 14 to the Listing Rules 上市規則附錄十四所載的企業管治守則及企業管治報告 the director(s) of our Company 本公司董事 the issued ordinary shares at the nominal value of RMB1.00 per share in the share capital of the Company which are subscribed for or credited as paid up in RMB 以人民幣認購或列作繳足的本公司股本中每股面值人民幣 1.00 元的已發行普通股 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 5

8 Definitions Group or our Group 本集團 the Company and its subsidiaries from time to time 本公司及其不時的附屬公司 H Share(s) the issued ordinary shares at the nominal value of RMB1.00 per share in the share capital of the Company which are listed on the Main Board of the Stock Exchange H 股 在聯交所主板上市的本公司股本中每股面值人民幣 1.00 元的已發行普通股 HK$ 港元 HKFRS 香港財務報告準則 Hong Kong 香港 Hong Kong dollar(s), the lawful currency of Hong Kong 香港法定貨幣港元 Hong Kong Financial Reporting Standards, including Hong Kong Accounting Standards and Interpretations promulgated by the Hong Kong Accounting Standard Board 香港財務報告準則, 包括香港會計準則及香港會計準則委員會頒佈的詮釋 the Hong Kong Special Administrative Region of the PRC 中國香港特別行政區 IPO the initial public offering of the Company s Shares through the Stock Exchange in May 2015 首次公開發售 Listing Date 上市日期 Listing Rules 上市規則 Model Code 標準守則 PRC 中國 二零一五年五月本公司股份通過聯交所成功首次公開發售 27 May 2015, being the date on which the H Shares were listed and from which dealings in the H Shares of the Company commenced on the Stock Exchange 二零一五年五月二十七日, 即 H 股於聯交所上市及開始買賣的日期 the Rules Governing the Listing of Securities on the Stock Exchange 聯交所證券上市規則 the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix 10 to the Listing Rules 上市規則附錄十所載的上市發行人董事進行證券交易的標準守則 the People s Republic of China, and for the purpose of this report only, excluding Hong Kong, Macau Special Administrative Region of the People s Republic of China and Taiwan 中華人民共和國, 僅本報告而言, 不包括香港 中華人民共和國澳門特別行政區及台灣 Reporting Period The 6-month period from 1 January 2021 to 30 June 2021 報告期 RMB 人民幣 SFO 證券及期貨條例 由二零二一年一月一日起至二零二一年六月三十日止六個月期間 Renminbi, the lawful currency of the PRC 中國的法定貨幣人民幣 the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) 香港法例第 571 章 證券及期貨條例 6 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

9 Definitions Share(s) 股份 Shareholder(s) 股東 Stock Exchange 聯交所 subsidiary(ies) 附屬公司 Supervisor(s) 監事 Supervisory Committee 監事委員會 ordinary share(s) in the share capital of our Company with a nominal value of RMB1.00 each, including the H Shares and Domestic Shares 本公司股本中每股面值人民幣 1.00 元的普通股, 包括 H 股及內資股 holder(s) of the Share(s) 股份持有人 The Stock Exchange of Hong Kong Limited 香港聯合交易所有限公司 has the meaning ascribed to it under the Listing Rules 具有上市規則賦予該詞的涵義 supervisor(s) of the Company 本公司的監事 the supervisory committee of the Company 本公司的監事委員會 YHTH Yunnan Health & Cultural Tourism Holding Group Co., Ltd.*( 雲南省康旅控股集團有限公司 ) (formerly known as Yunnan Metropolitan Construction Investment Co., Ltd.*( 雲南省城市建設投資集團有限公司 )), a limited liability company established in the PRC and is the sole shareholder of Yunnan Province Water, the Company s controlling shareholder and one of the Undertaking Shareholders 雲南康旅集團 YMCI 雲南省康旅控股集團有限公司 ( 前稱雲南省城市建設投資集團有限公司 ), 於中國成立的有限責任公司及雲南省水務的唯一股東, 為本公司控股股東及其中一名有承諾的股東 Yunnan Metropolitan Construction Investment Co., Ltd.*( 雲南省城市建設投資集團有限公司 ), a limited liability company established in the PRC and is the sole shareholder of Yunnan Province Water, the Company s controlling shareholder and one of the Undertaking Shareholders, its company name has been changed to Yunnan Health & Cultural Tourism Holding Group Co., Ltd.*( 雲南省康旅控股集團有限公司 ) on 26 November 2020 雲南城投集團 雲南省城市建設投資集團有限公司, 於中國成立的有限責任公司及雲南省水務的唯一股東, 為本公司控股股東及其中一名有承諾的股東, 其名稱已於二零二零年十一月二十六日更名為 雲南省康旅控股集團有限公司 Yunnan Province Water 雲南省水務 Yunnan Province Water Industry Investment Co., Ltd.*( 雲南省水務產業投資有限公司 ), a limited liability company incorporated in the PRC 雲南省水務產業投資有限公司, 於中國註冊成立的有限責任公司 % per cent % 百分比 * For identification purposes only * 僅供識別 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 7

10 Financial Highlights The Board is pleased to announce the following financial highlights: 董事會欣然宣佈下列財務摘要 : Six months ended 30 June Percentage 二零二零年 Change RMB 000 RMB 000 百分比 人民幣千元 變動 (Unaudited) (Unaudited) ( 未經審核 ) Revenue 收益 2,707,734 3,038, % Gross profit 毛利 660, , % Loss before income tax 所得稅前虧損 (379,194) (168,990) 124.4% (Note 1) EBITDA 除利息 稅項 折舊及 Loss attributable to ordinary shareholders of the Company 攤銷前利潤 ( 附註 1) 715, , % 本公司普通股股東應佔 虧損 (311,647) (297,951) 4.6% Basic loss per share (RMB) 每股基本虧損 ( 人民幣元 ) (0.261) (0.250) 4.4% Note 1: EBITDA is the profit for the Reporting Period before deduction of interests, income taxation, depreciation and amortization. 附註 1: 除利息 稅項 折舊及攤銷前利潤為扣除利息 所得稅 折舊及攤銷前之本報告期內利潤 8 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

11 Management Discussion and Analysis INDUSTRY OVERVIEW In the first half of 2021, the global economic and social activities have been hit hard by the COVID-19 pandemic. As the second quarter started, the overall situation of China s environmental protection industry remained complicated amid the increasing pressure from possible imported cases and lingering risks of domestic resurgence of the COVID-19 pandemic. In January 2021, 10 departments including the National Development and Reform Commission, Ministry of Ecology and Environment and Ministry of Finance jointly issued the Guiding Opinions on Promoting the Recycling Utilization of Wastewater* ( 關於推進污水資源化利用的指導意見 ) in order to accelerate the recycling utilization of wastewater, and promote the solution of water resource shortages, water environmental pollution, water ecological damage and other issues. In January 2021, the Ministry of Ecology and Environment issued an announcement on the National Catalog of Advanced Pollution Prevention and Control Technologies (Solid Waste and Soil Pollution Prevention and Control Field)* ( 國家先進污染防治技術目錄 ( 固體廢物和土壤污染防治領域 ) ), in which a batch of advanced technologies in the field of solid waste and soil pollution prevention has been collected and screened to promote technological progress in the field of solid waste and soil pollution prevention and to meet the demand for advanced technologies in pollution control. In April 2021, the revised Regulations on the Administration of Pollution Discharge Permits* ( 排污許可管理條例 ) were formally implemented, which formed a solution path for some major issues, laid a legal foundation for a more mature and complete management system for fixed pollution sources, and provided a long-term effective mechanism for improving the quality of the ecological environment. 二零二一年上半年, 國內國際社會經濟生活受新冠肺炎疫情的影響嚴重, 二季度以來, 在外防輸入壓力持續加大 國內新冠疫情反彈風險始終存在的背景下, 我國環境產業整體形勢依然不明朗 二零二一年一月, 國家發展改革委 生態環境部 財政部等 10 個部門聯合印發 關於推進污水資源化利用的指導意見, 以加快推進污水資源化利用, 促進解決水資源短缺 水環境污染 水生態損害等問題 ; 二零二一年一月, 生態環境部發佈了 國家先進污染防治技術目錄( 固體廢物和土壤污染防治領域 ) 的公告, 徵集並篩選了一批固體廢物和土壤領域污染防治先進技術, 以推動固體廢物和土壤污染防治領域技術進步, 滿足污染治理對先進技術的需求 ; 二零二一年四月, 修訂後的 排污許可管理條例 正式執行, 在一些重大問題上形成了解決路徑, 為固定污染源管理制度更加成熟定型更加完善奠定了法規基礎, 為改善生態環境品質提供了長牙齒的制度利器 The water industry as a whole has entered a mature stage, where water supply is in the late stage of maturity, and wastewater treatment is in the early stage of maturity. In general, the future development opportunities for the water industry are secondary water supply, rural environmental management, black and odorous water treatment, and comprehensive water environment management. The government will continue to intensify the efforts to improve the ecological environment, remedy the wastewater outfalls into rivers and seas and urban black and odorous water, and improve the capacity of urban domestic wastewater collection and industrial wastewater treatment in industrial parks; continue to adhere to the concept that green water and green mountains are golden and silver mountains, marking the continued improvement of the water industry. There will be greater demand for such water infrastructure projects, however, private enterprises will be less willing to invest, and more investment will be led by central enterprises and state-owned assets in the future. In this process, private enterprises mainly play their own advantages in efficiency, technology and operations, namely in a state of following. In recent years, intelligent water business has become a hot spot for the development of water industry, various funds, technologies and talents have already flowed to this industry. The technology of intelligent water business has enhanced the competitiveness of water business and represents the development direction of the industry. 水務行業總體進入成熟期, 其中供水處於成熟後期, 污水治理處於成熟期早期 總體上, 水務產業未來的發展機會在二次供水 農村環境治理 黑臭水體治理 水環境綜合治理等 繼續加大生態環境治理力度, 整治入河入海排污口和城市黑臭水體, 提高城鎮生活污水收集和園區工業廢水處置能力 繼續堅持綠水青山就是金山銀山理念, 標誌著水務行業持續向好 今後這類水務基建類項目需求較大, 但民營企業投資意願較低, 未來一段時間更多的是央企 國資主導的投資, 民營企業則在這個過程中主要發揮自身效率 技術 運營等的優勢, 處在跟隨跑的狀態 ; 智慧水務近幾年已經成為水務行業發展的熱點, 各路資金 技術 人才等早已開始向這個行業流動, 智慧水務的技術提升了水務業務的競爭力, 代表了行業的發展方向 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 9

12 Management Discussion and Analysis With the implementation of the pilot program for the construction of China s waste-free cities, in order to achieve the goal of minimizing the amount of urban solid waste, full recycling utilization and safe disposal, the integration of two networks, construction of a four-level network system and development of Internet + solid waste treatment industry is a major trend, and by then China s urban solid waste treatment system will also usher in a comprehensive upgrade. At present, the National Catalog of Advanced Pollution Prevention and Control Technologies* ( 國家先進污染防治技術目錄 ) has been issued to advance solid waste treatment technology and accelerate the release of demand, and pay more attention to the development of independent intellectual property rights and technological innovation. Among them, the waste incineration power generation industry and the hazardous waste treatment industry are the two most important sub-sectors. These subsectors started late and are still in the stage of rapid growth; there is a broad market prospect in the future. Incineration will gradually replace landfill and become the main method of urban domestic waste treatment. 隨著中國無廢城市的建設試點方案實施, 為實現城市固廢產生量最小 資源化利用充分 處置安全的目標, 兩網融合 四級網絡體系建設 發展 互聯網 + 固廢處理產業是大趨勢, 屆時中國的城市固廢處理體系也將迎來全面的升級 ; 目前已出台 國家先進污染防治技術目錄, 使固廢處理技術進步, 需求加速釋放, 更加重視自主知識產權開發和技術創新 其中垃圾焚燒發電行業和危廢處理行業是最重要的兩個子行業 該子行業起步較晚, 目前仍處於快速成長階段, 未來存在廣闊的市場前景, 焚燒處理將逐漸取代填埋成為城鎮生活垃圾處理的主要方式 The harmless and recycling treatment of sludge has always been a subdivision that has attracted much attention in the environmental protection field. With the successive introduction of national sludge disposal policies and technologies, the improvement of recycling and harmless treatment and the reduction of treatment costs, the sludge treatment industry will usher in a vast market. 污泥無害化和資源化的處理一直是來環保領域倍受關注的細分領域, 伴隨國家污泥處置政策和技術的相繼出台, 資源化和無害化程度的提高, 處理成本的縮減, 污泥處置行業將迎來廣袤市場 In the first half of 2021, due to the impact of COVID-19 pandemic, all industries have suffered shocks, and environmental protection companies are also facing unprecedented opportunities and challenges. The Group will continue to focus on research and development, increase research and development efforts, enhance core competitiveness, keep up with industry trends, expand the scope of operation and investment, to integrate business objectives with social responsibilities, and ensure the stable development. DEVELOPMENT STRATEGIES AND PROSPECT In the first half of 2021, recycling became a more popular topic in the environmental protection industry. With the further improvement of the China s requirements for environmental protection, the upgrading of environmental protection enterprises from technology to concept has become the focus of future development. The Group pays close attention to the industry trends, vigorously overcomes the adverse impact of the COVID-19 pandemic and makes unremitting efforts to properly respond to the severe and complex development environment. Due to the impact of the COVID-19 pandemic and the current high financial cost of the Group, the profitability in the first half of the year was lower than expected. In the second half of the year, the Group will continue to do its best to make up for the losses in the first half of the year. 二零二一上半年, 受新冠疫情影響各行各業都遭遇了衝擊, 環保企業也面臨前所未有的機遇與挑戰 本集團將持續專注研發, 加大研發力度, 增強核心競爭力, 緊跟行業動態, 擴大經營投資範圍, 使經營目標與社會責任相統一, 確保企業穩定發展 二零二一年上半年, 資源化 成為環保行業更加熱門的話題, 隨著國家對環保要求的進一步提高, 環保企業從技術到理念的提標升級成為未來發展的重點 本集團密切關注行業動態, 大力克服新冠肺炎疫情的不利影響, 妥善應對嚴峻複雜的發展環境, 作出了不懈努力 由於新冠肺炎疫情的影響, 同時由於本集團目前財務成本較高, 上半年盈利情況不及預期 下半年, 本集團將繼續全力以赴做好各項工作, 彌補上半年的虧損情況 10 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

13 Management Discussion and Analysis Optimize the debt structure At present, the asset-liability ratio of the Group is high, and the financing cost is rising. Subsequently, the Group will actively seek equity financing channels and strive to obtain capital supplement. Meanwhile, the Group will continue to adjust the long-term and short-term debt structure, adopt the strategy of comprehensive cost control, compare the financing costs horizontally and vertically, and find the optimal balance between long-term income and short-term income. The Group will also continue to expand innovative financing channels, reduce financial costs and optimize asset-liability ratio. Strengthen operation management The Group will continue to improve the operation quality and launch the threeyear action of improving the quality and efficiency of the Group s operation business according to the Group s development plan. Combined with the current operation status, reasonably calculate the indicators of each project to eliminate the unstable factors and hidden dangers exceeding the standard in the operation process. At the same time, by popularizing intelligent water business and other technologies, improve the operation efficiency of operation projects, reduce operation costs and realize greater operation income. Strengthen project construction The Group will concentrate its advantageous resources such as manpower, material, financial and technical resources to fully promote the development and construction of key projects, highlight the implementation of key projects, and ensure the smooth realization of the annual construction objectives. Enhance core technology Based on its core technology, the Group will accelerate technology R&D and market promotion. The Group will strengthen the development and application of biochar technology as the core R&D direction, and pyrolysis and carbonization process as a new generation of solid waste disposal technology, so as to fully realize the reduction, harmlessness, stabilization and recycling of solid organic waste treatment. 目前, 本集團資產負債率水平較高, 融資成本上升 後續本集團將積極尋求股權融資渠道, 爭取獲得資本金補充 同時, 本集團將繼續調整長短期負債結構, 同時採取全面成本控制的策略, 將融資成本進行橫向 縱向對比, 在長期收益與短期收益間找到最優均衡 本集團亦將繼續拓展創新性融資渠道, 減少財務成本支出, 優化資產負債率 本集團將繼續提升運營質量, 根據本集團發展規劃, 啓動本集團運營業務提質增效三年行動 結合目前運營現狀, 合理測算各項目指標, 消除運營過程中存在的不穩定因素和超標隱患 同時, 通過普及智慧水務等技術, 提高運營項目的運營效率, 降低運營成本, 實現運營收益更大化 本集團將集中人力 物力 財力及技術等優勢資源, 全力推進重點項目開發建設, 突出重點工程實施, 確保年度建設目標順利實現 以本集團核心技術為基礎, 加快推進技術研發和市場推廣 本集團將加強以生物炭技術的開發與應用作為核心研發方向, 熱解碳化工藝作為新一代固廢處置技術, 力爭全面實現固體有機質廢棄物處理的減量化 無害化 穩定化 資源化 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 11

14 Management Discussion and Analysis Looking forward, the Group will continue to adhere to the development goal of based in Yunnan, covering the nation and going global, striving to be a leading integrated environmental services provider at the municipal level * ( 立足雲南 面向全國 走向國際, 致力成為領先的城鎮環境綜合服務商 ), and further improve the operation and management standard, optimize the debt structure, overcome various challenges, and create greater value for its shareholders. BUSINESS REVIEW The Group is one of the leading integrated service providers in the urban environmental protection industry in China. The Group mainly adopts the Build- Operate-Transfer (the BOT ), Build-Own-Operate (the BOO ), Transfer-Operate- Transfer (the TOT ), Transfer-Own-Operate (the TOO ), Build and Transfer (the BT ), Engineering-Procurement-Construction (the EPC ), Rehabilitate-Operate- Transfer (the ROT ), Operation and Maintenance (the O&M ) and licensed operation models to provide customized and integrated turnkey solutions for water supply, wastewater treatment and solid waste treatment as well as system integration services of core technologies to customers. The Group s businesses are carried out in China and the southeast Asian countries, the Group s principal businesses comprise five major segments, namely, wastewater treatment, water supply, solid waste treatment, construction and sales of equipment and others. 未來, 本集團將繼續本著 立足雲南, 面向全國 走向國際, 致力於成為領先的城鎮環境綜合服務商 的發展目標, 進一步提高運營管理水準, 優化負債結構, 克服各項挑戰, 為股東創造價值 本集團為中國領先的城鎮環境綜合服務商之一 本集團的業務主要採用建設 營運 移交 ( BOT ) 建設 擁有 營運 ( BOO ) 移交 營運 移交 ( TOT ) 移交 擁有 營運 ( TOO ) 建設及移交( BT ) 設計 採購 施工 ( EPC ) 改造 營運 移交 ( ROT ) 營運及維護( O&M ) 及持牌運營等項目模式, 向客戶提供訂製及綜合的供水 污水處理及固廢處理的整體解決方案及核心技術系統集成服務 本集團的業務在中國境內及東南亞國家開展, 主營業務包括五個主要分部, 即污水處理 供水 固廢處理 建造及設備銷售以及其他服務 As at 30 June 2021, the Group s water related projects (including the following wastewater treatment projects, water supply projects and all water related projects under other business segments) had a total daily treatment capacity of approximately 6,412,650 tonnes. As at 30 June 2021, the Group s solid waste treatment related projects (including the following solid waste treatment projects and all solid waste treatment related projects under other business segments) had a total annual treatment capacity of approximately 4,081,900 tonnes. 截至二零二一年六月三十日, 本集團水務相關項目 ( 包含以下污水處理項目 供水項目及其他業務分部中的所有水務處理相關項目 ) 的日處理總量約為 6,412,650 噸 截至二零二一年六月三十日, 本集團固廢處理相關項目 ( 包含以下固廢處理項目及其他業務分部中的所有固廢處理相關項目 ) 的年處理總量約為 4,081,900 噸 12 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

15 Management Discussion and Analysis Wastewater Treatment Projects As at 30 June 2021, the Group had a total of 133 concession wastewater treatment projects, including 7 BOO projects, 69 BOT projects, 2 TOO projects, 26 TOT projects, 1 ROT project and 28 municipal comprehensive environmental treatment projects, with a total daily treatment capacity of approximately 3,573,900 tonnes, with an addition of 6 TOT projects and a reduction of 1 ROT project, and an increase in the daily wastewater treatment capacity of approximately 5,100 tonnes or a growth rate of approximately 0.14% as compared to that as at 31 December 截至二零二一年六月三十日, 本集團特許經營污水項目共 133 個, 包括 7 個 BOO 項目 69 個 BOT 項目 2 個 TOO 項目 26 個 TOT 項目 1 個 ROT 項目及 28 個市政綜合環境治理項目, 日處理總量約為 3,573,900 噸, 較二零二零年十二月三十一日增加 6 個 TOT 項目, 減少 1 個 ROT 項目, 日污水處理量增加約 5,100 噸, 增長率約為 0.14% As at 30 June 2021, 100 concession projects with a total daily treatment capacity of approximately 2,609,000 tonnes had commenced commercial operation (including 2 municipal comprehensive environmental treatment projects with a total daily wastewater treatment capacity of approximately 11,000 tonnes), with an addition of 6 TOT projects, an addition of 1 municipal environment comprehensive treatment project which commenced operation, and an increase in total daily treatment capacity of approximately 76,000 tonnes as compared to that as at 31 December During the Reporting Period, the Group s effective wastewater treatment utilization rate was approximately 77.3%, and the average unit charge of wastewater treatment was approximately RMB1.59 per tonne. 截至二零二一年六月三十日, 日處理總量約為 2,609,000 噸的 100 個特許經營項目已投入商業運營 ( 包括 2 個日污水處理總量約 11,000 噸的市政綜合環境治理項目 ), 較二零二零年十二月三十一日增加 6 個 TOT 項目, 新投運 1 個市政環境綜合治理項目, 日處理總量增加約 76,000 噸 於報告期內, 本集團的實際污水處理利用率約 77.3%, 平均污水處理收費單價約為每噸人民幣 1.59 元 As at 30 June 2021, 33 concession projects with total daily treatment capacity of approximately 964,900 tonnes had not commenced commercial operation (including 26 municipal comprehensive environmental treatment projects with a total daily treatment capacity of approximately 814,900 tonnes), with 1 municipal comprehensive environmental treatment project under construction and 1 ROT project converted to operation as compared to that as at 31 December 2020, the daily treatment capacity decreased by approximately 70,900 tonnes. 截至二零二一年六月三十日, 日處理總量為約 964,900 噸的 33 個特許經營項目尚未投入商業運營 ( 包括 26 個日污水處理總量約 814,900 噸的市政環境綜合治理項目 ), 較二零二零年十二月三十一日同比,1 個市政綜合治理項目和 1 個 ROT 項目從在建轉變為運營, 日污水處理量減少約 70,900 噸 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 13

16 Management Discussion and Analysis Water Supply Projects As at 30 June 2021, the Group had a total of 66 concession water supply projects with a total daily treatment capacity of approximately 2,449,100 tonnes, including 15 BOO projects, 34 BOT projects, 11 TOT projects and 6 municipal comprehensive environmental treatment projects, with a reduction of 2 BOT projects, and a decrease in the total daily capacity of approximately 30,400 tonnes as compared to that as at 31 December 截至二零二一年六月三十日, 本集團擁有 66 個日處理總量約 2,449,100 噸的供水特許經營項目, 其中包括 15 個 BOO 項目 34 個 BOT 項目 11 個 TOT 項目及 6 個市政綜合環境治理項目, 較二零二零年十二月三十一日減少 2 個 BOT 項目, 日處理總量減少約 30,400 噸 As at 30 June 2021, 47 concession projects with a total daily capacity of approximately 1,550,000 tonnes had commenced commercial operation (including 1 municipal comprehensive environmental treatment project with a total daily treatment capacity of approximately 30,000 tonnes), with an addition of 1 BOO project, and an increase in the total daily capacity of approximately 20,000 tonnes as compared to that as at 31 December During the Reporting Period, the Group s water supply for non-residential and special industries decreased, while the effective water supply utilization rate was approximately 62%, and the average unit charge of water supply was approximately RMB2.18 per tonne. 截至二零二一年六月三十日, 日處理總量約 1,550,000 噸的 47 個特許經營項目已投入商業運營 ( 包括 1 個日處理總量約 30,000 噸的市政綜合環境治理項目 ), 較截至二零二零年十二月三十一日新投運 1 個 BOO 項目, 日處理總量增加約 20,000 噸 於報告期內, 受新冠疫情影響, 本集團非居民供水量 特種行業供水量有所下降, 實際供水利用率約為 62%, 平均供水收費單價約為每噸人民幣 2.18 元 As at 30 June 2021, 19 concession projects with a total daily capacity of approximately 899,100 tonnes had not commenced commercial operation (including 5 municipal comprehensive environmental treatment projects with a total daily treatment capacity of approximately 429,700 tonnes), with a reduction of 2 BOT projects as compared to that as at 31 December BOO project under construction converted to operation, the total daily capacity decreased by approximately 51,000 tonnes. Solid Waste Treatment Projects As at 30 June 2021, the Group had 24 solid waste treatment projects with a total annual treatment capacity of 4,081,900 tonnes, 13 of which with an annual treatment capacity of 2,186,600 tonnes had commenced commercial operation (including 1 municipal comprehensive environmental treatment project with an annual treatment capacity of approximately 219,000 tonnes), and 11 of them with an annual treatment capacity of 1,895,300 tonnes were under construction (including 2 municipal comprehensive environmental treatment projects with an annual treatment capacity of approximately 900,800 tonnes. As compared to that as at 31 December 2020, 5 projects under construction converted to operation, 1 additional solid waste treatment project was under construction and the total annual treatment capacity of the Group increased by 36,400 tonnes. During the Reporting Period, the Group s effective solid waste treatment utilization rate was approximately 82.2%. 截至二零二一年六月三十日, 日處理總量約 899,100 噸的 19 個特許經營項目尚未投入商業運營 ( 包括 5 個日處理總量約 429,700 噸的市政綜合環境治理項目 ), 較截至二零二零年十二月三十一日減少 2 個 BOT 項目,1 個 BOO 項目從在建轉變為運營, 日處理總量減少約 51,000 噸 截至二零二一年六月三十日, 本集團擁有 24 個固廢處理項目, 年處理總量為 4,081,900 噸, 其中年處理量為 2,186,600 噸的 13 個項目已經投入商業運營 ( 包括 1 個處理量約 219,000 噸的市政綜合環境治理項目 ), 年處理量為 1,895,300 噸的 11 個項目正在建設 ( 包括 2 個年處理量約 900,800 噸的市政綜合環境治理項目 與二零二零年十二月三十一日相比,5 個項目從在建轉為運營, 新增 1 個在建的固廢處理項目, 本集團年處理總量增加 36,400 噸 於報告期內, 本集團的實際固廢處理利用率約為 82.2% 14 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

17 Management Discussion and Analysis Construction and Sales of Equipment The Group s construction and sales of equipment segment comprises BT projects, EPC projects and sales of equipment. As at 30 June 2021, the Group had a total of 11 BT projects, which were either under construction and/or completed, among which the income of 10 BT projects was recognised as revenue during the Reporting Period. 本集團的建造及設備銷售分部包括 BT 項目 EPC 項目及設備銷售 截至二零二一年六月三十日, 本集團在建設及 或已完工的 BT 項目共 11 個, 其中 10 個 BT 項目的收入於報告期內確認為收益 During the Reporting Period, the Group had a total of 13 EPC projects. 於報告期內, 本集團 EPC 項目共 13 個 The Group engages in the production, sales and installation of equipment for wastewater treatment, water supply, solid waste treatment and other infrastructure facilities. The major category of water related equipment in the Group s production is membrane. Most of the membrane products are produced by the own plant of the Group. 本集團生產 銷售及安裝污水處理 供水 固廢處理及其他基礎設施的設備, 本集團所生產的水務相關設備的主要類別為膜產品 大部分膜產品由本集團自有工廠生產 Others During the Reporting Period, the Group also undertook O&M projects for wastewater treatment, water supply and solid waste treatment facilities owned by third parties as well as provision of technical and consultancy services in relation to environmental protection. As at 30 June 2021, the Group had 30 O&M projects, with an addition of 1 wastewater treatment project as compared to that as at 31 December These projects included 29 wastewater treatment projects with a total daily treatment capacity of approximately 363,650 tonnes (including the capacity of wastewater treatment projects adopting O&M model within municipal environment comprehensive treatment projects), and 1 water supply project with daily treatment capacity of approximately 5,000 tonnes. FINANCIAL REVIEW Results of Operation During the Reporting Period, the Group recorded revenue of approximately RMB2,707.7 million, representing a period-on-period decrease of approximately 10.9% as compared to that for the six months ended 30 June During the Reporting Period, the Group recorded a net loss of approximately RMB363.3 million, compared to a loss of RMB193.2 million over the six months ended 30 June Loss attributable to the ordinary shareholders of the Company was approximately RMB311.6 million, compared to loss attributable to the ordinary shareholders of the Company of RMB298.0 million over the six months ended 30 June Loss per share for the six months ended 30 June 2021 was approximately RMB 本集團在報告期內也就第三方擁有的污水處理 供水及固廢處理設施開展 O&M 項目, 並提供了與環境保護相關的技術及諮詢服務 截至二零二一年六月三十日, 本集團擁有 30 個 O&M 項目, 較二零二零年十二月三十一日增加 1 個污水處理項目 其中,29 個日處理總量約為 363,650 噸的污水處理項目 ( 包括市政環境綜合治理項目中以 O&M 模式運營的污水處理項目的規模 ),1 個日處理量約為 5,000 噸的供水項目 本集團於報告期內錄得收益約人民幣 2,707.7 百萬元, 與截至二零二零年六月三十日止六個月同比降幅約為 10.9% 相較於截至二零二零年六月三十日止六個月的虧損約人民幣 百萬元, 本集團報告期內錄得淨虧損約人民幣 百萬元 相較於截至二零二零年六月三十日止六個月普通股股東應佔虧損約人民幣 百萬元, 本公司普通股股東應佔虧損約為人民幣 百萬元 截至二零二一年六月三十日止六個月的每股虧損約為人民幣 元 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 15

18 Management Discussion and Analysis Revenue Revenue of the Group decreased from approximately RMB3,038.6 million for the six months ended 30 June 2020 to approximately RMB2,707.7 million for the Reporting Period, representing a decrease of approximately 10.9%. 本集團的收益由截至二零二零年六月三十日止六個月約人民幣 3,038.6 百萬元降低至報告期內約人民幣 2,707.7 百萬元, 降幅約 10.9% In respect of the business segments of the Group, revenue from the wastewater treatment business segment increased by approximately 4.0% from approximately RMB1,760.9 million for the six months ended 30 June 2020 to approximately RMB1,831.7 million for the Reporting Period. Revenue from the water supply segment decreased by approximately 3.3% from approximately RMB405.4 million for the six months ended 30 June 2020 to approximately RMB392.1 million for the Reporting Period. Revenue from solid waste treatment business segment decreased by approximately 43.7% from approximately RMB621.5 million for the six months ended 30 June 2020 to approximately RMB349.6 million for the Reporting Period. Revenue from construction and sales of equipment business segment decreased by approximately 66.3% from approximately RMB201.2 million for the six months ended 30 June 2020 to approximately RMB67.8 million for the Reporting Period. Revenue from other business increased by approximately 34.1% from approximately RMB49.6 million for the six months ended 30 June 2020 to approximately RMB66.5 million for the Reporting Period. 就本集團的業務分部而言, 污水處理業務分部的收益由截至二零二零年六月三十日止六個月約人民幣 1,760.9 百萬元上升約 4.0% 至報告期約人民幣 1,831.7 百萬元 供水業務分部的收益由截至二零二零年六月三十日止六個月約人民幣 百萬元下降約 3.3% 至報告期約人民幣 百萬元 固廢處理業務分部的收益由截至二零二零年六月三十日止六個月約人民幣 百萬元下降約 43.7% 至報告期約人民幣 百萬元 建造及設備銷售業務分部的收益由截至二零二零年六月三十日止六個月約人民幣 百萬元下降約 66.3% 至報告期約人民幣 67.8 百萬元 其他業務的收益由截至二零二零年六月三十日止六個月約人民幣 49.6 百萬元上升約 34.1% 至報告期約人民 66.5 百萬元 The increase in revenue from the wastewater treatment business segment was mainly attributable to the increase in operating revenue caused by the increase in wastewater treatment unit price or treatment capacity of some water plants during the Reporting Period. 污水處理業務分部收益上升主要是由於報告 期內部分水廠污水處理單價或處理量上升帶 來運營收益增加 The decrease in revenue from the water supply business segment was mainly attributable to the decrease in operation revenue during the Reporting Period. 供水業務分部收益下降主要是由於報告期內 運營收益減少所致 The decrease in revenue from the solid waste treatment business segment was mainly attributable to the decrease in construction revenue as some solid waste projects were completed during the Reporting Period. 固廢處理業務分部收益下降主要是於報告期 內部分固廢項目已完工, 建造收益減少所致 The decrease in revenue from the construction and sales of equipment business segment was mainly attributable to the decrease in EPC construction services and equipment sales during the Reporting Period. 建造及設備銷售業務分部收益下降主要是由於 報告期內 EPC 建設服務及設備銷售減少所致 The increase in revenue from the other business segment was mainly attributable to an increase in service revenue generated by certain new O&M projects during the Reporting Period. 其他業務分部收益增加主要是由於報告期內 新增若干 O&M 項目產生的服務收益增加所致 16 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

19 Management Discussion and Analysis Cost of Sales During the Reporting Period, the Group recorded cost of sales of approximately RMB2,047.5 million, representing a period-on-period decrease of approximately RMB372.2 million or 15.4% as compared to approximately RMB2,419.7 million for the six months ended 30 June The decrease in cost of sales was mainly attributable to the decrease in cost for construction which was in line with the decrease in construction revenue of the existing solid waste projects and wastewater treatment projects under construction during the construction period. Gross Profit Margin During the Reporting Period, gross profit margin of the Group was approximately 24.4%, representing an increase of approximately 4.0% as compared to approximately 20.4% for the six months ended 30 June Other Income During the Reporting Period, the Group recorded other income of approximately RMB31.4 million, representing a period-on-period decrease of approximately RMB14.0 million or a decrease rate of approximately 30.8% as compared with approximately RMB45.4 million for the six months ended 30 June The decrease in other income was mainly attributable to a decrease in other nonoperating income during the Reporting Period. Selling Expenses During the Reporting Period, selling expenses of the Group were approximately RMB24.6 million, representing a period-on-period increase of approximately RMB1.6 million or 7.0%, from approximately RMB23.0 million for the six months ended 30 June Administrative Expenses During the Reporting Period, administrative expenses of the Group were approximately RMB201.1 million, representing a period-on-period decrease of approximately RMB29.4 million or 12.8% from approximately RMB230.5 million for the six months ended 30 June The decrease in administrative expenses was primarily due to the Group did not need to provide impairment losses on non-financial assets during the Reporting Period. Finance Costs net Net finance costs increased by approximately RMB199.5 million from approximately RMB558.9 million for the six months ended 30 June 2020 to approximately RMB758.4 million for the Reporting Period, representing an increase of approximately 35.7%. The increase in net finance costs was primarily due to that certain projects under construction of the Group are in the early stage during which significant investment is required to be made on an ongoing basis, resulting in an increase in financial costs during the Reporting Period. 本集團於報告期內錄得銷售成本約人民幣 2,047.5 百萬元, 較截至二零二零年六月三十日止六個月約人民幣 2,419.7 百萬元同比減少約人民幣 百萬元或 15.4% 銷售成本減少是由於原在建的固廢項目及污水處理項目於建設期的建造收益減少, 相應的建造成本降低所致 於報告期內, 本集團的毛利率約 24.4%, 較截至二零二零年六月三十日止六個月約 20.4% 上升約 4.0% 於報告期內, 本集團錄得其他收入約人民幣 31.4 百萬元, 較截至二零二零年六月三十日止六個月約人民幣 45.4 百萬元同比減少約人民幣 14.0 百萬元, 降幅約為 30.8% 其他收入減少主要是由於報告期內其他營業外收入減少所致 於報告期內, 本集團的銷售開支約人民幣 24.6 百萬元, 較截至二零二零年六月三十日止六個月約人民幣 23.0 百萬元同比增加約人民幣 1.6 百萬元或 7.0% 於報告期內, 本集團的行政開支約人民幣 百萬元, 較截至二零二零年六月三十日止六個月約人民幣 百萬元同比減少約人民幣 29.4 百萬元或 12.8% 行政開支減少主要是由於報告期內本集團無需計提非金融資產減值損失所致 融資成本淨額由截至二零二零年六月三十日止六個月約人民幣 百萬元增加約人民幣 百萬元至報告期內約人民幣 百萬元, 增幅約為 35.7% 融資成本淨額增加主要是由於報告期內本集團若干在建項目處於早期階段, 其間需要按持續基準作出大量投資, 導致融資成本增加 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 17

20 Management Discussion and Analysis The average interest rate on borrowings of the Group for the Reporting Period was approximately 5.63% per annum, representing a period-on-period increase compared with approximately 5.34% per annum for the six months ended 30 June Loss before Income Tax As a result of the foregoing, the Group recorded a loss before income tax of approximately RMB379.2 million for the six months ended 30 June 2021, compared to a loss before income tax of approximately RMB169.0 million for the six months ended 30 June Income Tax Credit/(Expenses) The Group recorded income tax credit of approximately RMB15.9 million for the six months ended 30 June 2021, compared to income tax expenses of approximately RMB24.2 million for the six months ended 30 June Loss for the Reporting Period As a result of the foregoing, loss for the Reporting Period increased by approximately RMB170.1 million from a net loss of approximately RMB193.2 million for the six months ended 30 June 2020 to a net loss of approximately RMB363.3 million for the Reporting Period. Receivables under Service Concession Arrangements The Group s receivables under service concession arrangements increased by approximately RMB435.0 million from approximately RMB5,301.4 million as at 31 December 2020 to approximately RMB5,736.4 million as at 30 June 2021, representing an increase of approximately 8.2%. The increase was mainly attributable to a number of concession projects commenced commercial operation during the Reporting Period. Trade and Other Receivables and Prepayments The Group s trade and other receivables and prepayments decreased by approximately RMB166.3 million from approximately RMB9,604.8 million as at 31 December 2020 to approximately RMB9,438.5 million as at 30 June 2021, representing a decrease of approximately 1.7%. Such decrease was primarily due to the decrease in the amounts due from related parties and project outsourcers due to the Group s collection of receivables during the Reporting Period. 本集團於報告期內平均借款利率約為每年 5.63%, 與截至二零二零年六月三十日止六個月的約每年 5.34% 同比有所增長 由於上述因素, 相較於截至二零二零年六月三十日止六個月所得稅前虧損約人民幣 百萬元, 本集團截至二零二一年六月三十日止六個月錄得所得稅前虧損約人民幣 百萬元 相較於截至二零二零年六月三十日止六個月的所得稅開支約人民幣 24.2 百萬元, 本集團就截至二零二一年六月三十日止六個月錄得所得稅抵免約人民幣 15.9 百萬元 由於上述各項, 報告期內虧損由截至二零二零年六月三十日止六個月淨虧損約人民幣 百萬元增加約人民幣 百萬元至報告期內淨虧損約人民幣 百萬元 本集團服務特許經營安排下的應收款項由二零二零年十二月三十一日的約人民幣 5,301.4 百萬元增加約人民幣 百萬元至二零二一年六月三十日的約人民幣 5,736.4 百萬元, 增幅約 8.2% 該增加主要由於報告期內若干特許經營項目開始商業運營所致 本集團的貿易及其他應收款項以及預付款項由二零二零年十二月三十一日的約人民幣 9,604.8 百萬元減少約人民幣 百萬元至二零二一年六月三十日的約人民幣 9,438.5 百萬元, 降幅約 1.7% 該減少主要是由於在報告期內本集團收取應收款項導致應收關聯方及工程發包商款項減少所致 18 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

21 Management Discussion and Analysis Cash and Cash Equivalents The Group s total cash balance decreased by approximately RMB954.1 million from approximately RMB1,697.7 million as at 31 December 2020 to approximately RMB743.6 million as at 30 June 2021, representing a decrease of approximately 56.2%. Such decrease was primarily due to the net cash used in operating and investing activities exceeding the net cash generated from financing activities during the Reporting Period. Trade and Other Payables The Group s trade and other payables decreased by approximately RMB523.5 million from approximately RMB9,036.4 million as at 31 December 2020 to approximately RMB8,512.9 million as at 30 June 2021, representing a decrease of approximately 5.8%. Such decrease was primarily due to the payment for construction and installation during the Reporting Period. Borrowings As at 30 June 2021, the Group had borrowings of approximately RMB27,363.5 million (31 December 2020: approximately RMB27,541.8 million). As at 30 June 2021, the Group had unsecured borrowings of approximately RMB14,743.0 million (31 December 2020: approximately RMB15,365.8 million), and secured borrowings of approximately RMB12,620.5 million (31 December 2020: approximately RMB12,176.0 million). Pledge of Assets As at 30 June 2021, borrowings of approximately RMB12,620.5 million (31 December 2020: approximately RMB12,176.0 million) were secured by the Group s receivables under service concession arrangements, contract assets, right-ofuse assets, property, plant and equipment, intangible assets and the Company s investments in subsidiaries. Capital Commitments The Group s capital commitments increased by approximately RMB234.0 million from approximately RMB12,780.1 million as at 31 December 2020 to approximately RMB13,014.1 million as at 30 June 2021, representing an increase of approximately 1.8%. 本集團的現金結餘總額由二零二零年十二月三十一日的約人民幣 1,697.7 百萬元減少約人民幣 百萬元至二零二一年六月三十日的約人民幣 百萬元, 降幅約 56.2% 該減少主要是由於報告期內用於經營和投資活動的現金淨額大於融資活動的現金淨流入部分 本集團的貿易及其他應付款項由二零二零年十二月三十一日的約人民幣 9,036.4 百萬元減少約人民幣 百萬元至二零二一年六月三十日的約人民幣 8,512.9 百萬元, 減幅約 5.8% 該減少主要是由於在報告期內償付建築安裝款 於二零二一年六月三十日, 本集團借款約為人民幣 27,363.5 百萬元 ( 二零二零年十二月三十一日 : 約人民幣 27,541.8 百萬元 ) 於二零二一年六月三十日, 本集團的無抵押借款約為人民幣 14,743.0 百萬元 ( 二零二零年十二月三十一日 : 約人民幣 15,365.8 百萬元 ) 及有抵押的借款約為人民幣 12,620.5 百萬元 ( 二零二零年十二月三十一日 : 約人民幣 12,176.0 百萬元 ) 於二零二一年六月三十日, 借款約人民幣 12,620.5 百萬元 ( 二零二零年十二月三十一日 : 約人民幣 12,176.0 百萬元 ), 由本集團服務特許經營安排下的應收款項 合約資產 使用權資產 物業 廠房及設備 無形資產及本公司於附屬公司的投資質押作抵押 本集團的資本承擔由二零二零年十二月三十一日約人民幣 12,780.1 百萬元增加約人民幣 百萬元至二零二一年六月三十日約人民幣 13,014.1 百萬元, 增幅約 1.8% INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 19

22 Management Discussion and Analysis Gearing Ratio The Group s gearing ratio (calculated by net debt divided by total capital) decreased from approximately 77.3% as at 31 December 2020 to approximately 75.0% as at 30 June 2021, representing a decrease of approximately 2.3%. The decrease was primarily due to the issuance of equity financing instruments by the Group during the Reporting Period. SIGNIFICANT INVESTMENTS AND ACQUISITIONS On 15 January 2021, the Company entered into a framework agreement with, among others, Zhejiang Qianjiang Biochemical Co. Ltd.* ( Qianjiang Biochemical ), pursuant to which, Qianjiang Biochemical will purchase 49% equity interest in Zhejiang Haiyun Environmental Protection Company Limited* ( Zhejiang Haiyun Environmental Protection ) by means of non-public issue of shares to the Company. On 6 June 2021, the Company entered into an equity acquisition and share issuance agreement with, among others, Qianjiang Biochemical, pursuant to which, Qianjiang Biochemical agreed to acquire 49% equity interest in Zhejiang Haiyun Environmental Protection held by the Company at the consideration of RMB777,140,000, which would be settled by Qianjiang Biochemical through the issuance of consideration shares. Upon completion of the aforesaid transactions, the Company ceases to hold any equity in Zhejiang Haiyun Environmental Protection and holds approximately 22.6% equity in Qianjiang Biochemical, which will be accounted for as an associated company of the Company. For details, please refer to the announcements published by the Company on 15 January 2021 and 6 June 2021 and circular published by the Company on 25 June 本集團資產與負債的比率 ( 按淨債務除以總資本計算 ) 由二零二零年十二月三十一日的約 77.3% 降至二零二一年六月三十日的約 75.0%, 降幅約 2.3% 該降幅主要是由於集團於報告期內發行權益類融資工具所致 於二零二一年一月十五日, 本公司與浙江錢江生物化學股份有限公司 ( ) 簽訂框架協議, 據此, 錢江生化將以向本公司非公開發行股份的方式, 購買浙江海雲環保有限公司 ( )49% 的股權 於二零二一年六月六日, 本公司與錢江生化 ( 其中包括 ) 簽訂股權收購及股份發行協議, 據此, 錢江生化同意以代價人民幣 777,140,000 元收購本公司持有的浙江海雲環保 49% 的股權, 代價將由錢江生化透過發行代價股份結算 上述交易完成後, 本公司不再持有浙江海雲環保任何股權並將持有錢江生化約 22.6% 股權, 而錢江生化將作為本公司的聯營公司入賬 有關詳情, 請參閱本公司日期分別為二零二一年一月十五日及二零二一年六月六日的公告以及本公司日期為二零二一年六月二十五日的通函 On 4 March 2021, the Company resolved to dispose of 51% equity interest in Yueyang Dongting Water Investment Co., Ltd.* ( Yueyang Dongting Water ). On 1 July 2021, the Company (as the vendor) and Yueyang Construction and Investment Group Co., Ltd.* ( Yueyang Construction and Investment )(as the purchaser) entered into the equity transaction agreement and its supplemental agreement, pursuant to which, the Company has agreed to sell, and Yueyang Construction and Investment has agreed to acquire, 51% equity interest in Yueyang Dongting Water at a consideration of RMB77,630,000. Upon completion of the aforesaid transactions, the Company ceases to have any interest in Yueyang Dongting Water. For details, please refer to the announcements published by the Company on 4 March 2021, 28 June 2021 and 2 July 於二零二一年三月四日, 本公司已決議出售本公司於岳陽市洞庭水務投資有限公司 ( )51% 的股權 於二零二一年七月一日, 本公司 ( 作為賣方 ) 及岳陽市城市建設投資集團有限公司 ( )( 作為買方 ) 訂立產權交易合同及其補充協議, 據此, 本公司同意出售且岳陽城投同意購買岳陽洞庭水務 51% 的股權, 代價為人民幣 77,630,000 元 上述交易完成後, 本公司將不再擁有岳陽洞庭水務任何權益 有關詳情, 請參閱本公司日期分別為二零二一年三月四日 二零二一年六月二十八日及二零二一年七月二日的公告 20 YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021

23 Disclosure of Interests INTERESTS AND SHORT POSITIONS OF DIRECTORS, SUPERVISORS AND CHIEF EXECUTIVES IN SHARES, UNDERLYING SHARES AND DEBENTURES As at 30 June 2021, Directors, Supervisors and chief executives of the Company had the following interests in the shares, underlying shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which were required, pursuant to Section 352 of the SFO or otherwise, to be entered in the register maintained thereunder, or which were required, pursuant to the Model Code, to be notified to the Company and the Stock Exchange, or held interests in the Company as follows: 於二零二一年六月三十日, 本公司董事 監 事及最高行政人員於本公司或其任何相聯法 團 ( 定義見證券及期貨條例第 XV 部 ) 的股份 相關股份及債券中, 擁有根據證券及期貨條 例第 352 條或以其他方式須載入本公司根據該 條文所存置的登記名冊的權益, 或根據標準 守則須知會本公司及聯交所的權益, 或已持 有的本公司權益如下 : Percentage Name of Director, Supervisor and chief executive Capacity Type of Shares Number of Shares held Percentage of the respective type of Shares in issue (%) % of the total number of Shares in issue (%) % Mr. Yu Long 于龍先生 Mr. Yu Long 于龍先生 Mr. Huang Yi 黃軼先生 Beneficial owner 實益擁有人 Beneficial owner 實益擁有人 Beneficial owner 實益擁有人 Domestic Shares 內資股 H Shares H 股 Domestic Shares 內資股 1,0820,000 (L) ,000 (L) ,560,000 (L) (L) refers to long position (L) 代表好倉 Save as disclosed above, to the best knowledge of the Company, as at 30 June 2021, none of the Directors, Supervisors and chief executives of the Company had any interests or short positions in the shares, underlying shares and debentures of the Company or its associated corporations which were recorded in the register required to be kept by the Company under Section 352 of the SFO, or as otherwise required to be notified to the Company and the Stock Exchange pursuant to the Model Code. 除上文披露者外, 據本公司所深知, 於二零二一年六月三十日, 概無董事 監事及本公司最高行政人員於本公司或其相聯法團的任何股份 相關股份及債券中, 擁有根據證券及期貨條例第 352 條須載入本公司登記名冊的權益及淡倉或根據標準守則須另行知會本公司及聯交所的權益 INTERIM Report 2021 YUNNAN WATER INVESTMENT CO., LIMITED 21

24 Disclosure of Interests SUBSTANTIAL SHAREHOLDERS INTERESTS AND SHORT POSITIONS IN SHARES To the Company s best knowledge, as at 30 June 2021, the following persons (other than Directors or Supervisors whose interests are disclosed in the section headed Interests and Short Positions of Directors, Supervisors and Chief Executives in Shares, Underlying Shares and Debentures above) had interests or short positions in the Shares, underlying Shares or debentures of the Company which were required to be notified to the Company under Divisions 2 and 3 of Part XV of the SFO, or had interests or short positions in 5% or more of the respective type of share capital in issue of the Company which were recorded in the register required to be kept by the Company under Section 336 of the SFO: 據本公司所深知, 於二零二一年六月三十日, 下列人士 ( 本公司的董事及監事除外, 彼等之 權益於上文 董事 監事及最高行政人員在股 份 相關股份及債券之權益及淡倉 一節披 露 ) 於本公司股份 相關股份及債券中擁有根 據 證券及期貨條例 第 XV 部第 2 及第 3 分部須 向本公司披露權益或淡倉或根據證券及期貨 條例第 336 條須存置在本公司登記冊中記錄的 權益或淡倉, 擁有佔本公司類別已發行股本 5% 或以上的權益或淡倉 : Percentage Name of Shareholder Capacity Type of Shares Percentage of the respective type of Shares in issue (%) Number of Shares % of the total number of Shares in issue (%) % Yunnan Province Water 1 1 雲南省水務 Mr. Huang Yunjian 1 1 黃雲建先生 Mr. Liu Xujun 1 1 劉旭軍先生 Wang Yong 1 1 王勇先生 Beneficial owner, interests held jointly with another person 實益擁有人, 與另一名人士共同持有權益 Beneficial owner, interests held jointly with another person 實益擁有人, 與另一名人士共同持有權益 Beneficial owner, interests held jointly with another person 實益擁有人, 與另一名人士共同持有權益 Beneficial owner, interests held jointly with another person 實益擁有人, 與另一名人士共同持有權益 Domestic Shares 內資股 Domestic Shares 內資股 Domestic Shares 內資股 Domestic Shares 內資股 361,487,162 (L) ,487,162 (L) ,487,162 (L) ,487,162 (L) YUNNAN WATER INVESTMENT CO., LIMITED INTERIM Report 2021