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Zhejiang Southeast (BQ36)

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Wednesday 31 July, 2002

Zhejiang Southeast

Interim Results

Zhejiang Southeast Elec Power Co Ld
31 July 2002


               Zhejiang Southeast Electric Power Company Limited


                              Interim Results 2002




Important:


The Board of Directors of Zhejiang Southeast Electric Power Company Limited (the
'Company') confirms that there are no false representations, misleading
statements or material omissions in this announcement, and they jointly and
severally accept full responsibility for the authenticity, accuracy and
completeness of the information contained herein.


The interim financial statements attached to this announcement have not been
audited.


The text of this Interim Results is prepared in both Chinese and English. Should
there be any discrepancies between the Chinese version and the English version,
the Chinese version shall prevail.


 I. Particulars of the Company


     1. Particulars of the Company


        (1)     Listing Place of B Shares: Shanghai Stock Exchange


        Abbreviation of B shares: ZSEPC B Shares


        Code of B Shares: 900949


        Listing Place of GDRs: London Stock Exchange


        Code of GDRs: 0949QLT


        (2)     Secretary to the Board of Directors: Dai Jiancheng


        Address: 22-23 Floor, Biao Li Tower, 528 Yan'an Road,


        Hangzhou, Zhejiang Province, P.R.C.


        Postal Code: 310006


        Tel: 86571-85774566


        Fax: 86571-85774321


     2. Summary of Financial Data and Indicators


    (based on consolidated financial statements)


                                                                               Unit: RMB yuan

                                                                       January - June 2002           January - June 2001
    Net Profit                                                              296,993,882.25                351,866,282.41
    Net Profit after Deducting Non-recurring Profits &                      304,837,129.24                353,020,747.31
    Losses
    Yield on Net Assets (diluted) (in %)                                              5.24                          6.41
    Earnings per Share (Diluted) (yuan/share)                                        0.148                         0.175

                                                                              30 June 2002              31 December 2001
    Shareholders' Equity (excluding minority                              5,664,423,370.60              5,367,429,488.35
    shareholders)
    Net Assets per Share                                                              2.82                          2.67


II. Shareholding of Major Shareholders

     1. There was no change in the total number of shares or the shareholding
        structure of the Company in this reporting period.

     2. Total number of shareholders as at the end of the period


        As at the end of the reporting period, the Company's shareholders
        numbered 86,262 in total.


     3. Shareholding of top 10 shareholders


    As at the end of this reporting period, the top 10 shareholders of the
    Company are as follows:

    Name                                                        Number of Shares       Percentage of      Type of Shares
                                                                            Held        Shareholding
    Zhejiang Provincial Electric Power Development Co.              799,963,200                39.80   State-owned legal
    (ZPEPDC)                                                                                             person's shares
    Zhejiang Provincial Electric Power Co. (ZPEPC)                  514,036,800                25.57   State-owned legal
                                                                                                         person's shares
    NAITO SECURITIES CO.,LTD                                         14,198,374                 0.71            B shares
    TOYO SECURITIES ASIA LTD. A/C CLIENT                              8,456,900                 0.42            B shares
    Huacong Investment Co. Ltd                                        6,307,825                 0.31            B shares
    SCBHK A/C BROWN BROTHERS HARRIMAN AND COBOSTON S/A CMO            5,126,959                 0.26            B shares
    EMERGING MARKETS FUND
    Zhejiang Bada Co. Ltd                                             4,000,000                 0.20      Legal person's
                                                                                                                  shares
    HKSBCSB S/A HSBC(NOM) S/A ABN AMRO BANK NV                        4,000,000                 0.20            B shares
    SCBHK A/C NOMURA TB/NOMURA ITM                                    3,700,000                 0.18            B shares
    BRITISH AIRWAYS PENSIONS                                          3,023,999                 0.15            B shares


III. Management Discussion and Analysis


     1. Analysis of Operational and Financial Status (based on consolidated
        financial statements)

        Unit: RMB '000 yuan

        Item                                         January - June 2002          January - June 2001  Increase/Decrease
                                                                                                                     (%)
        Principal Operating Income                           1,593,850.9                  1,639,633.9              -2.79
        Principal Operating Profit                             532,427.7                    586,238.7              -9.18
        Net Profit                                             296,993.9                    351,866.3             -15.59

        Item                                                30 June 2002               1 January 2002  Increase/Decrease
                                                                                                                     (%)
        Total Assets                                         8,263,379.0                  7,817,884.5               5.70
        Shareholders' Equity                                 5,664,423.4                  5,367,429.5               5.53

         1. The drop in the principal operating income by 2.79% was caused by a
            reduction in the Company's generation by 4.89% compared with the
            same period in the previous year. Please refer to 'Main Operations
            in the Reporting Period' for details.

         2. The drop in the principal operating profit in this reporting period
            is attributable to the decrease in the principal operating income
            and the increase in cost.

         3. The drop in the net profit is mainly attributable to the decrease in
            the principal operating income. It is also due to the following
            factors:

             a. As the bank deposit and the interest rate on bank deposit
                declined compared with the same period in the previous year, the
                Company's interest income decreased significantly in this
                reporting period whereas its financial expenses increased.

             b. The non-operating expenditure increased in this reporting period
                due to losses on assignment of non-operating assets and
                abandonment of fixed assets.

             c. As the income tax refund will normally be obtained in the
                following period, the refund of the local income tax for the 4th
                quarter of 2001 amounting to RMB 16.53 million yuan will be
                obtained in the 2nd half of this year. In the same period of the
                previous year, the refund of the local income tax for the 4th
                quarter of 2000 amounting to RMB 11.01 million yuan was credited
                before 30 June 2001.


         4. The total assets increased by RMB 445.4945 million yuan, of which the
            construction in progress increased by RMB 679.2431 million yuan
            compared with the same period in the previous year because of the
            increase in the infrastructure construction of Zhejiang Changxing
            Power Generation Co. Ltd.

         5. The increase in the shareholders' equity resulted from the increased
            net profit realized by the Company in this reporting period.


     2. Major Operations in the Reporting Period


        The Company specializes in operation and management of power generating
        companies, with all of its principal operating income deriving from the
        sale of electric power. The composition of the Company's principal
        operating income and cost is as follows:


        Unit: RMB'000 yuan

        Item
                                                                            Current Amount         Percentage (%)

        Principal Operating Income
        Electricity Sale                                                       1,593,850.9                 100.00       
                                                              
        Total                                                                  1,593,850.9                 100.00       
                                                                
                                                                               
        Principal Operating Cost
        Cost of Electricity Sale                                               1,039,563.2                 100.00
        Total                                                                  1,039,563.2                 100.00


        In this reporting period, the generation completed by the Company
        amounts to 4.963 billion kwh, which decreased by 255 million kwh or
        4.89% in comparison with the generation of 5.218 billion kwh over the
        same period in the previous year. The main factors affecting the
        Company's generation are as follows:


         1. Based on the maintenance plan, some generating units underwent
            necessary maintenance in the 1st half of the year while the system
            load was relatively low. Compared with the same period in the
            previous year, 432 maintenance hours for a 330 MW unit and 672
            maintenance hours for a 125 MW unit were additionally arranged in
            this reporting period.


         2. The power purchase from other provinces in Zhejiang power grid
            increased significantly, offsetting part of the power consumption
            increase due to Zhejiang's economic development.


        If compared with the same period in the preceding year, on the one hand,
        the Company's principal income reduced by RMB 81.90 million yuan due to
        reduction of generation; on the other hand, the Company stepped up the
        analysis and study of the power market and improved its bidding tactics
        to make up for the generation loss to some degree so that the Company's
        actual settlement price for the electricity sale in the 1st half of the
        year rose by RMB 0.008 yuan/kwh in comparison with that over the same
        period in the previous year resulting in an increase in the principal
        operating income of RMB 36.12 million yuan. To sum up the above two
        factors, the net result is a decrease in the principal operating income
        by RMB 45.78 million yuan or 2.79%.


        In order to enhance the competitiveness of its generating units and
        lower the unit generation cost, a sustained effort was made to retrofit
        the turbine steam path of the 125 MW-sized units. The retrofit of Unit 1
        of Xiaoshan Power Plant was completed on 28 January this year, which
        increased its capacity from 125 MW to 130 MW. Beginning on 10 May this
        year, the retrofit of Unit 2 of Taizhou Power Plant is underway. After
        completion of the retrofit, the capacity of Unit 2 of Taizhou Power
        Plant will increase from 125 MW to 135 MW.


     3. Comparison of Operating Results in this Reporting Period vs Annual Plan


                                                                          Unit: RMB'000 yuan

                                                       1st Half Year                   Annual Plan      Completion (%)
        Principal Operating Income                       1,593,850.9                   3,216,337.3               49.55
        Gross Profit                                       445,486.0                     820,639.8               54.29
        Net Profit                                         296,993.9                     533,328.6               55.69


     4. Investment Progress and Returns


         1. Investment Utilizing Remainder of Proceeds Raised


            Pursuant to the resolutions passed at the Extraordinary General
            Meeting of year 2001, the remainder of the proceeds raised from
            share issuance by ZSEPC is to be injected into Zhejiang Jiahua Power
            Generation Co. Ltd. (Zhejiang Jiaxing Power Plant Phase II with 4 x
            600 MW generating units) in the form of capital contribution, making
            up 24% of its stock. Its registered capital will be injected by
            installment. The paid-in capital of ZSEPC has amounted to RMB 133.25
            million yuan. The Company made no new capital injection within this
            reporting period. Currently, construction work of Jiaxing Power
            Plant Phase II is underway. Based on the construction schedule, Unit
            1 of Jiaxing Power Plant Phase II will be brought into operation by
            the end of 2004; and all four units will be brought into commercial
            operation one after another by June 2006.


         2. Other Investment

             a. Zhejiang Changxing Power Generation Co. Ltd

             b. The Company holds 65% of the shares of Zhejiang Changxing Power
                Generation Co. Ltd (Zhejiang Changxing Power Plant Phase IV with
                2 x 300 MW generating units). Currently, project construction is
                progressing smoothly. As at the end of this reporting period,
                64.3% of the project construction had been completed. Based on
                the construction schedule, the 1st unit will commence operation
                at the end of this year; the 2nd unit will commence operation at
                the end of June next year.

             c. In this reporting period, the Company obtained returns on
                investment totaling RMB 1,049,300 yuan, of which RMB 911,600
                yuan was the dividends for the year 2001 from investee companies
                received as at the Company by the end of this reporting period,
                comprising RMB 600,000 yuan from Zhejiang Venture Capital
                Investment Co. Ltd and RMB 311,600 yuan from Jiaojiang Phoenix
                Hotel Co. Ltd.


     5. Business Plan for the Second Half of the Year


         1. On the basis of safe production, centering around economic benefits,
            orienting towards the power market and strengthening cost control,
            the Company will continue to conduct its principal operations well
            and make every effort to meet the goal of realizing a total profit
            of RMB 821 million yuan for the whole year set in the Shareholders'
            General Meeting.

         2. Efforts will be made to expedite the retrofit of the steam path of
            the 125 MW turbines. Following the completion of the retrofit of
            Unit 2 of Taizhou Power Plant, it is planned that retrofit will be
            performed in the second half of the year to Unit 2 of Xiaoshan Power
            Plant and Unit 3 of Taizhou Power Plant.

         3. Management of the ongoing construction projects such as Changxing
            Power Plant Phase IV and Jiaxing Power Plant Phase II will be
            strengthened in an effort to make quality projects. The focus of the
            work for the second half of the year is to ensure the commencement
            of production of the first unit of Changxing Power Plant Phase IV by
            the end of the year so as to create a new profit center for the
            Company in the following year.

         4. Further effort will be made to make in-depth and sound preparation
            for the initial stage of investment projects in terms of project
            investigation, study and analysis and to actively seek support from
            various parties, aiming for new progress in this regard.


IV. Important Matters


     1. The board of directors of the Company decided not to make any interim
        profit distribution in 2002, nor to convert any public reserve fund into
        the share capital.


     2. The profit distribution plan of the Company for 2001 was to distribute
        cash dividend RMB 0.25 yuan per share (including tax), in which the
        dividends of B shares will be converted into US dollars for
        distribution, i.e. USD 0.030204 per B share (including tax). China
        Securities Registration & Settlement Co. Ltd Shanghai Branch was
        entrusted to distribute the dividends of B shares on behalf of the
        Company. Dividends payable to the shareholders of domestic shares were
        directly credited to the designated accounts.


     3. The Company was not subject to any major litigation or arbitration.


     4. Asset Acquisition, Sale or Disposal


         1. In this reporting period, the Company did not make any major asset
            acquisition.

         2. In order to make non-operating assets operational, the Company
            transferred the collective dormitory, the staff training center with
            ancillary facilities in the living quarters of Xiaoshan Power Plant
            as well as the land use right in connection therewith to Hangzhou
            Xiaoshan Linjiang Industrial & Trade Co. Ltd upon inspection and
            valuation by Zhejiang Pan-China Certified Public Accountants
            (Document No. Zhe Tian Ping Bao Zi (2002) 42). The book value of the
            above assets is RMB 11.8675 million yuan, and their assessed value
            is RMB 5.4782 million yuan. The price of the transfer was based on
            the assessed value, i.e. RMB 5.4782 million yuan.


     5. Important Connected Transactions


         1. Commodity Sale and Purchase


             a. Power Sales


                Because of the special characteristics and current status of the
                power industry, ZPEPC is the single buyer in Zhejiang power
                grids. All of the electricity generated by the power plants
                under the Company is sold to ZPEPC. ZPEPC is the second largest
                shareholder of the Company.


                In this reporting period, the Company made a power sale of 4.567
                billion kwh to ZPEPC, generating a sale income of RMB 1.594
                billion yuan, accounting for 100% of the principal operating
                income. In accordance with the Market Code governing competitive
                bidding in the Zhejiang power generation market, about 80% of
                the Company's power sale was billed at the contractual price
                approved by Zhejiang Provincial Commodity Pricing Bureau, and
                about 20% of its power sale was settled at the spot market
                price. If compared with the same period in the preceding year,
                there is no change in the contractual price. The competitive
                bidding price applied to the Company in this reporting period
                averaged RMB 0.338 yuan/kwh.


             b. Coal Purchase


            Coal supply for power generation by the Company was solely sourced
            from Zhejiang Fuxing Power Fuel Co., Ltd, which is a subsidiary with
            its controlling shares held by Zhejiang Provincial Power Fuel Corp.
            (a wholly-owned subsidiary of ZPEPC) and part of its shares are held
            by the Company. In this reporting period, as the Company had not
            reached any agreement on the coal price for this year with the coal
            suppliers, the Company made coal payment amounting to RMB 576
            million yuan for the 1st half of the year at the price level
            prevailing at the end of the preceding year. Please refer to 'Other
            Important Matters and Events Subsequent to Balance Sheet Date' for
            the details of coal price.


         2. Guarantees


            The Company provided Zhejiang Changxing Power Generation Co. Ltd
            (Zhejiang Changxing Power Plant Phase IV) and Zhejiang Jiahua Power
            Generation Co. Ltd (Zhejiang Jiaxing Power Plant Phase II)
            respectively with shareholders' guarantees proportional to its
            investment in them in 2001, which was disclosed in the 2001 Annual
            Report. The above guarantees show no signs of potential
            indebtedness. No additional guarantees were provided in this
            reporting period.


         3. Trusted Loan


            In order to improve the capital use efficiency, the Company
            entrusted Industrial and Commercial Bank of China, Hangzhou
            Qingchunlu Branch in December 2001 and January 2002 respectively to
            grant loans to the Company's subsidiary Zhejiang Changxing Power
            Generation Co. Ltd totaling RMB 100 million yuan at an annual
            interest rate of 5.85% for a term of 1 year.


         4. Repayment of Long-term Liabilities


        Pursuant to the Repayment Agreement for 2001 and Subsequent Years
        between the Company and ZPEPDC as well as ZPEPC, the outstanding
        long-term liabilities owing to the two creditors as at the end of 2001
        amounted to RMB 978,180,000.00 yuan, of which long-term liabilities due
        within 1 year amounted to RMB 326,060,000.00 yuan. In this reporting
        period, the Company repaid the principal of the long-term liabilities
        amounting to RMB 163,030,000.00 yuan.


     6. Trust Fund Management


        In line with the Company's board resolution to authorize the management
        team to invest in State treasury bonds and other securities with an
        amount less than RMB 300 million yuan, the Company signed 3 Trust Fund
        Management Agreements with Zhejiang Provincial International Trust
        Investment Corp. separately.

        Trustee                                              Amount                                  Term
                                                  (in millions yuan)

        Zhejiang Provincial International Trust   100                          From 4 January 2002 to 4 January 2003
        Investment Corp.
        Zhejiang Provincial International Trust   100                          From 22 April 2002 to 22 April 2003
        Investment Corp.
        Zhejiang Provincial International Trust   100                          From 23 June 2002 to 23 June 2003
        Investment Corp.


        The above 3 Agreements have not provided for a specific rate of return
        on capital. As the Agreements have not become due, no return has been
        generated to date.


     7. Other Important Matters and Events Subsequent to the Balance Sheet Date


         1. In accordance with the stipulations issued by the Ministry of
            Finance, the Company was subject to a corporate income tax at the
            statutory taxation rate of 33% starting from 1 January 2002, which
            put an end to the old policy requiring a taxation rate of 33%
            payable to both central and local governments but allowing a refund
            of 18% of the local portion of the tax collected.

         2. In line with Document Zhe Cai Gong Zi (2001)229 Letter of Consent on
            Refund of Corporate Income Tax to ZSEPC, in 2001 the Company
            received a refund equal to 18% of local portion of the tax payment
            for the period of January to September 2001 amounting to RMB 89.77
            million yuan. The 18% of the local portion of the tax payment from
            November to December 2001 amounting to RMB 16.53 million yuan will
            be refunded in the latter half of this year.

         3. In this reporting period, as the Company had not reached an agreement
            with the coal suppliers in relation to the coal price applicable
            this year, the coal payment by the Company for power generation in
            the 1st half of the year was accounted for in the principal
            operating cost provisionally as per the price level prevailing at
            the end of the previous year. The Company reached an agreement on
            the coal price of Taizhou Power Plant with the coal supplier on 22
            July 2002. On the basis that the coal price should not be higher
            than the price of the same type of coal purchased within Zhejiang
            power system with different prices for different qualities of coal
            taking into account the actual transportation/sundry costs. Compared
            with the average coal price in the previous year, the average coal
            price of Taizhou Power Plant went up by RMB 8.9 yuan/ton this year.
            The agreement was performed starting from 1 January 2002, and it is
            anticipated that the principal operating cost of the Company in the
            1st half of the year will increase by about RMB 14.46 million yuan.
            The coal price for Xiaoshan Power Plant is now still under
            negotiation.


         4. Pursuant to the notice requiring provincial enterprises to conduct
            self-examination of tax payment issued by the Tax Inspection Bureau
            under the Zhejiang Branch of the State Taxation Bureau, a
            self-examination of the tax payment in 2001 was conducted by the
            Company. Upon examination, it was found that the Company had to make
            additional payment for income tax in relation to cost and expenses
            amounting to RMB 1.47 million yuan, tax payment in relation to tax
            adjustment amounting to RMB 20.53 million yuan, and overdue payment
            amounting to RMB 1.10 million yuan. The above payments were made by
            the Company on 24 July 2002. The Company also needs to make
            additional payment for VAT amounting to RMB 7.5 million yuan, which
            has not yet been paid.


 V. Financial Statements (Unaudited)


     1. Balance Sheet and Statement of Profit


     2. Notes to Financial Statements


        Based on Document Zhe Guo Shui Zhi (2002)093 Approval on Deduction of
        ZSEPC's Asset Loss Before Tax, the difference between the submitted
        amount of the Company's fixed assets abandonment loss in 2001 and the
        approved amount is RMB 1,570,749.29 yuan. The amounts of undistributed
        profit and the fixed assets disposal at the beginning of the year in the
        financial statements were adjusted in accordance with the enterprise
        accounting system. The adjusted beginning amount of the undistributed
        profit at the beginning of the year in 2002 is RMB 834,877,574.16 yuan
        (the audited beginning amount of the undistributed profit at the
        beginning of the year in 2002 prior to adjustment is RMB 833,306,824.87
        yuan); the adjusted amount of the fixed assets disposal at the beginning
        of the year is RMB 1,570,749.29 yuan (the audited beginning amount of
        the fixed assets disposal at the beginning of the year in 2002 prior to
        adjustment is 0.00 yuan).


                                     Balance Sheet

                                   As at 30 June 2002


        Prepared by: Zhejiang Southeast Electric Power Company Limited Unit: RMB
        Yuan

                           Assets                       Ending Amount                       Beginning Amount
                                                Consolidated            Company       Consolidated            Company
        Current assets
        Monetary fund                       1,124,868,538.73   1,086,051,130.59   1,459,410,636.05   1,430,831,373.27
        Short term investments                300,411,730.00     400,411,730.00         482,890.00      50,523,515.00
        Bills receivable
        Share dividend receivable
        Interests receivable
        Accounts receivable                    88,889,638.29      88,889,638.29      88,563,205.11      88,563,205.11
        Other receivable                       26,577,721.62      25,796,841.55      22,210,487.95      21,675,119.65
        Prepayments                            73,924,459.31      35,786,569.31      10,146,885.57       4,296,885.57
        Subsidy receivable
        Inventories                            90,652,592.62      90,652,592.62     106,429,581.19     106,429,581.19
        Deferred expenses                       2,360,199.21       2,360,199.21
        Long term investments in debt due 
         within 1 year
        Other current assets
             Total current assets           1,707,684,879.78   1,729,948,701.57   1,687,243,685.87   1,702,319,679.79
        Long term investments:
        Long term equity investments        1,208,550,000.00   1,605,050,000.00   1,208,550,000.00   1,605,050,000.00
        Long term debt investments
        Total long term investments         1,208,550,000.00   1,605,050,000.00   1,208,550,000.00   1,605,050,000.00
        Fixed assets:
        Costs of fixed assets               6,614,441,378.55   6,606,373,277.16   6,644,095,956.77   6,637,486,567.77
                                            
                Less: Accumulated 
                depreciation                3,153,699,760.53   3,152,498,960.49   2,966,765,248.60   2,966,147,451.48

        Net value of fixed assets           3,460,741,618.02   3,453,874,316.67   3,677,330,708.17   3,671,339,116.29

                Less: Reserve for fixed assets
                devaluation

        Net amount of fixed assets          3,460,741,618.02   3,453,874,316.67   3,677,330,708.17   3,671,339,116.29
        Project material                          516,829.50         123,375.00      41,556,517.00      13,075,066.00
        Construction in progress            1,649,814,553.52      86,878,650.04     970,571,471.38      52,417,570.37
        Disposal of fixed assets                1,523,578.00       1,523,578.00       1,570,749.29       1,570,749.29
             Total fixed assets             5,112,596,579.04   3,542,399,919.71   4,691,029,445.84   3,738,402,501.95
        Intangible assets and other assets:
        Intangible assets                     224,042,607.13     224,042,607.13     227,502,198.31     227,502,198.31
        Long term deferred expenses            10,504,949.16         148,512.44       3,559,195.52         444,637.46
        Other long term assets
             Total intangible and other 
             assets                           234,547,556.29     224,191,119.57     231,061,393.83     227,946,835.77
        Deferred tax:
        Deferred tax debit
             Total assets                   8,263,379,015.11   7,101,589,740.85   7,817,884,525.54   7,273,719,017.51



                                                           Ending Amount                     Beginning Amount

        Liabilities and shareholders' equity    Consolidated            Company      Consolidated            Company

        Current liabilities:
        Short term borrowings                 430,000,000.00                        200,000,000.00
        Bills payable                         222,081,802.00
        Accounts payable                      257,821,334.92      82,813,413.82     233,465,102.22     125,644,647.62
        Accounts received in advance
        Wages payable                          90,567,884.18      90,567,884.18     110,963,634.40     111,255,157.17
        Welfare expenses payable               20,699,258.36      19,626,915.72      24,948,130.18      24,156,928.09
        Dividend payable                      199,990,800.00     199,990,800.00     502,500,000.00     502,500,000.00
        Tax payable                           110,736,509.57     110,724,399.18     107,126,219.56     107,108,076.24
        Other payments due                      9,438,764.26       9,378,982.66       4,863,247.04       4,851,621.04
        Other payables                         53,867,844.49      51,390,939.15      47,497,510.70      45,473,180.91
        Accruals                               55,101,446.73      55,101,446.73       7,404,293.09       7,079,293.09
        Estimated liabilities
        Long term liabilities due within 
        one year                              163,030,000.00     163,030,000.00     326,060,000.00     326,060,000.00
        Other current liabilities
             Total current liabilities      1,613,335,644.51     782,624,781.44   1,564,828,137.19   1,254,128,904.16
        Long term liabilities:
        Long term borrowings                  772,120,000.00     652,120,000.00     672,126,900.00     652,120,000.00
        Bonds payable
        Long term payables
        Special payables
        Other long term liabilities
             Total long term liabilities      772,120,000.00     652,120,000.00     672,126,900.00     652,120,000.00
        Deferred tax:
        Deferred tax credit
             Total liabilities              2,385,455,644.51   1,434,744,781.44   2,236,955,037.19   1,906,248,904.16
        Minority shareholders' equity         213,500,000.00                        213,500,000.00
        Shareholders' equity
        Share capital                       2,010,000,000.00   2,010,000,000.00   2,010,000,000.00   2,010,000,000.00
        Less: investments paid back
        Net value of share capital          2,010,000,000.00   2,010,000,000.00   2,010,000,000.00   2,010,000,000.00
        Capital reserve                     1,863,272,079.51   1,863,272,079.51   1,863,272,079.51   1,863,272,079.51
        Surplus reserve                       659,279,834.68     659,279,834.68     659,279,834.68     659,279,834.68
        Including: statutory common 
        welfare reserve                       329,639,917.34     329,639,917.34     329,639,917.34     329,639,917.34
        Undistributed profits               1,131,871,456.41   1,134,293,045.22     834,877,574.16     834,918,199.16
             Total shareholders' equity     5,664,423,370.60   5,666,844,959.41   5,367,429,488.35   5,367,470,113.35
             Total liabilities and owners' 
             equity                         8,263,379,015.11   7,101,589,740.85   7,817,884,525.54   7,273,719,017.51




                                  Statement of Profit

                                  January - June 2002

        Prepared by: Zhejiang Southeast Electric Power Company Limited Unit: RMB Yuan

                                                                         January - June 2002         January - June 2001

                               Item                              Consolidated               Company
        1. Income from principal operating activities        1,593,850,915.17      1,593,850,915.17    1,639,633,895.83
        Less: Principal operating costs                      1,039,563,215.61      1,039,563,215.61    1,032,670,525.13
             Principal operating tax and surtax                 21,860,003.34         21,860,003.34       20,724,647.08
        2. Profit from principal operating activities          532,427,696.22        532,427,696.22      586,238,723.62
          (loss indicated by '-')
        Add: Profit from other activities                          279,486.92            279,486.92          307,972.10
          (loss indicated by '-')
        Less: Operating expenses
             Administrative expenses                            47,433,615.08         47,433,615.08       66,790,011.45
             Financial expenses                                 21,335,945.65         21,335,945.65        6,478,760.91
        3. Operating profit                                    463,937,622.41        463,937,622.41      513,277,923.36
        (loss indicated by '-')
        Add: Investment income                                   1,049,261.16          3,430,224.97
        (loss indicated by '-')
             Subsidy income
             Non-operating income                                  368,263.56            368,263.56          171,571.51
        Less: Non-operating expenses                            19,869,124.91         19,869,124.91        4,693,849.48
        4. Gross profit                                        445,486,022.22        447,866,986.03      508,755,645.39
        (loss indicated by '-')
        Less: Income tax                                       148,492,139.97        148,492,139.97      156,889,362.98
        5. Net profit                                          296,993,882.25        299,374,846.06      351,866,282.41
        (loss indicated by '-')





                                                 Board of Directors

                                     Zhejiang Southeast Electric Power Company
                                                      Limited

                                                    31 July 2002




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