DALIANREFRIGERATIONCO.,LTD. QUARTERLYREPORTFORFIRSTQUARTER,2017 §1ImportantNotes 1.1The directorsand theBoardofDirectors,thesupervisorsand theSupervisoryBoard,and Seniorstaff membersofDalianRefrigerationCo.,Ltd.(hereinafterreferredtoastheCompany)herebyconfirmthatthereare noanyimportantomissions,fictitiousstatementsorseriousmisleadingcarriedinthisreport,andshalltakeall responsibilities,individualand/orjoint,forthereality,accuracyandcompletenessofthewholecontents. 1.2AllthedirectorshaveattendedthisBoardmeetingoftheCompanyexceptMrTakagiToshiyuki. 1.3ChairmanoftheBoardofDirectorsoftheCompanyMr.JiZhijian,FinancialMajordomoMr.MaYun,andthe headofAccountingDepartmentMrs.MaoChunhuaherebyconfirmthatthefinancialreportofthequarterly reportistrueandcomplete. 1.4ThisreportiswrittenrespectivelyinChineseandinEnglish.Intheeventofanydiscrepancybetweenthetwo above-mentionedversions,theChineseversionshallprevail. §2CompanyProfile 2.1Majoraccountingdataandfinancialindexes January-March, January-March,2016 Increase/decreaseoverthesame 2017 periodoflastyear Totaloperatingincome 474,819,352.69 400,592,922.66 18.53% Netprofitattributabletoshareholdersoflisted 33,297,454.56 25,527,518.21 30.44% companies Netprofitattributabletoshareholdersoflisted companies after deducting non-recurring 32,797,617.05 25,497,476.68 28.63% gains/losses Netcashgeneratedfromoperatingactivities -137,117,775.57 -89,736,770.51 -52.80% Basicearningspershare 0.05 0.05 0.00% Dilutedearningspershare 0.05 0.05 0.00% Returnonequity 1.02% 0.96% Increase0.06percentagepoints March31,2017 December31,2016 Increase/decreaseovertheendof lastyear Totalassets 4,994,298,464.88 4,983,511,574.26 0.22% Owner’sequityattributabletoshareholdersof 3,275,951,495.82 3,247,797,768.92 0.87% listedcompanies Itemofnon-recurringgainsandlosses Amountfrombeginningofyeartotheendofreportperiod Disposalgainsandlossesofnon-currentasset 72,310.71 Governmentsubsidiesincludedincurrentprofitorloss 355,000.00 Otheroperatingrevenueorexpense 174,229.94 Incometaxeffect 107,497.41 Minorityshareholders’gainsandlosses -5,794.27 Total 499,837.51 2.2Totalnumberandparticularsoftheshareholdersbytheendofthereportperiod Totalshareholdersattheendofreportperiod 41,152 Shareholdingoftoptenshareholders Numberof Numberof Total shareswith pledged Name Nature Proportion number sale sharesor restriction shares frozen Domestic DalianBingshanGroupCo.,Ltd. non-state-ownedlegal 19.96%122,083,524 0 person SANYOELECTRICCOLTD Foreignlegalperson 8.58% 52,502,250 0 Zheshang Juchao New thinking Others 1.77% 10,820,256 0 hybridsecuritiesinvestmentfund IndustrialSeouritiesGoldKylin2 Others 1.67% 10,229,236 7,280,081 Aggregateassetmanagementplan NationalSocialSecurityFunds104 Others 1.32% 8,100,000 5,864,510 Portfolio NationalSocialSecurityFunds503 Others 0.96% 5,864,510 5,864,510 Portfolio CaitongCapitalKunzeNo.2 Others 0.96% 5,864,509 5,864,509 SecuritiesvInestmentFund ShenzhenB&DCapitalFengnian Others 0.96% 5,864,509 5,864,509 JinjiaNo.1Fund LinZhenming Foreignnaturalperson 0.72% 4,450,000 0 ZheshangJuchaoindustrygrow Others 0.64% 3,932,595 0 hybridsecuritiesinvestmentfund Particularsaboutsharesheldbythetoptennegotiableshareholdersnotsubjecttoconditionalsales Nameofshareholder EORP(shares) Type DalianBingshanGroupCo.,Ltd. 122,083,524 A SANYOELECTRICCOLTD 52,502,250 B ZheshangJuchaoNewthinkinghybridsecuritiesinvestmentfund 10,820,256 A LinZhenming 4,450,000 B ZheshangJuchaoindustrygrowhybridsecuritiesinvestmentfund 3,932,595 A SunHuiming 3,724,449 B BOICSECURITIESLIMITED 3,162,744 B WuAn 3,110,036 B IndustrialandCommercialBank of-PengHuareformdividendequity 3,000,000 A securitiesinvestmentfund IndustrialSeouritiesGoldKylin2Aggregateassetmanagementplan 2,949,155 A DalianBingshanGroupCo.,Ltd. hadtheassociationrelationshipwith Notestotheassociatedrelationshipanduniformactionsoftheabove SanyoElectricCo.,Ltd.amongthe shareholders aboveshareholders.SanyoElectric Co.,Ltd.holds26.6%ofDalian BingshanGroupCo.,Ltd.'sequity. §3ImportantMatters 3.1Majorchangesinmainfinancialitemsandindexes,anddescriptionofthecause √Applicable□Inapplicable 1.Accountsinadvanceincreasedsignificantlycomparedwiththeyear-beginning,mainlyduetotheincrease inequipmentsinadvanceintheperiod. 2.Othercurrentassetsdecreasedsignificantlycomparedwiththeyear-beginning,mainlyduetothedecrease invalueaddedtaxandincometaxoftheaccruedtradeinallowancethatthetaxespayabletransferred. 3.Employeecompensationpayabledecreasedsignificantlycomparedwiththeyear-beginning,mainlydueto intheperiodthepaymentofprovisionemployeecompensationoflastperiod-end. 4.Financialexpensedecreasedsignificantlyy-o-y,mainlyduetothereductionininterestincomeinthe period. 5.Investmentincomeincreasedsignificantlyy-o-y,mainlyduetothecashdividend11.15millionfrom GuotaiJunan. 6.Netcashfromoperatingactivitiesdecreasedsignificantlyy-o-y,mainlyduetotheincreaseincashpaidfor purchasingcommoditiesandreceivinglaborservice. 7.Netcashflowfrominvestingactivitiesreducedsignificantlyy-o-y,mainlyduetotheincreaseinthe investmentincash39.20milliontotheDalianBingshanGroupManagementConsultingCo.,Ltd. 8.Netcashflowfromfinancingactivitiesdecreasedsignificantlyy-o-y, mainlyduetotheCompany receivingofspecialfundofChinaDevelopmentFundthelastyear. 3.2ImportantProgressandtheanalysisoftheinfluenceandsolution □Applicable√Inapplicable 3.3CommitmentsoftheCompanyoritsshareholders,actualcontrollerandotherrelatedpartiesinthereporting periodorcarriedtothereportingperiod□Applicable√Inapplicable 3.4Precautionsonforecastingthatbythebeginningofyeartilltheendofthenextreportperiod,theaccumulated netprofitmaybeturnedintolossorchangegreatlycomparedwiththatinthesameperiodofthelastyear,and descriptionofthecause□Applicable√Inapplicable 3.5Thesecuritiesinvestment□Applicable√Inapplicable 3.6Derivativeinvestment□Applicable√Inapplicable 3.7Tableofinvestigation,communication,interviewreceivedReceivingtime Wayofreceiving Receivedobjecttype BasicsituationindexJan.03,2017 Fieldinvestigation Institution http://irm.cninfo.com.cn/ssessgs/S000530 TakepartinChinainternationalJan.04,2017 capitalcorporation Institution http://irm.cninfo.com.cn/ssessgs/S000530 NewtechnologyBBSJan.12,2017 Fieldinvestigation Institution http://irm.cninfo.com.cn/ssessgs/S000530Jan.18,2017 Fieldinvestigation Institution http://irm.cninfo.com.cn/ssessgs/S000530Jan.19,2017 Fieldinvestigation Institution http://irm.cninfo.com.cn/ssessgs/S000530Mar.08,2017 Fieldinvestigation Institution http://irm.cninfo.com.cn/ssessgs/S000530Mar.09,2017 Fieldinvestigation Institution http://irm.cninfo.com.cn/ssessgs/S000530 3.8Violationofexternalguaranty□Applicable√Inapplicable 3.9Non-operationcapitaloccupationbyholdingshareholdersandtheirrelatedpartiesinthelistedcompany□Applicable√Inapplicable §4FinancialReport(attached) Notaudited. BoardofDirectorsofDalianRefrigerationCo.,Ltd. April21,2017 BALANCESHEET PreparedbyDalianRefrigerationCo.,Ltd. March31,2017 Unit:RMBYuan Assets 31-Mar-2017 31-Dec-2016 Consolidation ParentCompany Consolidation ParentCompany Currentassets: Monetaryfunds 487,433,249.05 376,837,939.08 679,724,805.76 496,417,106.54 Financialassetswhicharemeasuredbyfairvalueand whichchangesarerecordedincurrentprofitandloss Derivativefinancialassets Notesreceivable 129,785,323.88 84,812,372.59 130,426,225.74 90,509,540.07 Accountsreceivable 844,972,869.56 142,678,685.68 759,053,298.97 117,575,405.74 Accountsinadvance 125,620,052.95 109,751,666.10 95,141,043.96 96,269,883.15 Interestreceivables 723,955.56 723,955.56 Dividendreceivable 39,025.00 Otherreceivables 59,566,880.29 5,850,462.94 52,982,713.89 4,368,505.07 Inventories 369,964,744.39 179,658,898.46 323,863,067.48 151,230,744.47 Assetsheldforsale Non-currentassetduewithinoneyear Othercurrentassets 26,621,939.66 19,246,943.70 40,470,210.65 30,563,139.06 Totalcurrentassets 2,043,965,059.78 918,836,968.55 2,082,424,347.01 987,658,279.66 Non-currentassets: Financeassetheldavailableforsales 535,841,492.34 534,526,349.84 545,565,116.64 544,249,974.14 Held-to-maturityinvestment Long-termaccountreceivable Long-termequityinvestment 1,369,475,462.66 1,773,146,647.54 1,309,741,316.21 1,713,412,501.09 Investmentproperty 28,422,582.14 28,422,582.14 28,605,652.94 28,605,652.94 Fixedassets 508,870,947.30 284,413,081.62 509,422,197.88 274,262,264.28 Constructioninprogress 321,996,478.82 311,689,454.87 321,646,676.78 320,329,247.78 Engineeringmaterial Disposaloffixedasset Productivebiologicalasset Oilandgasasset Intangibleassets 154,656,038.54 88,504,364.11 154,714,212.52 88,113,279.88 ExpenseonResearchandDevelopment Goodwill 1,750,799.49 1,750,799.49 Long-termexpensestobeapportioned 4,435,257.31 3,410,869.34 4,448,719.77 3,658,276.80 Deferredincometaxasset 24,884,346.50 6,403,008.03 25,192,535.02 6,751,619.50 Othernon-currentasset Totalnon-currentasset 2,950,333,405.10 3,030,516,357.49 2,901,087,227.25 2,979,382,816.41 Totalassets 4,994,298,464.88 3,949,353,326.04 4,983,511,574.26 3,967,041,096.07 LegalRepresentative:JiZhijian ChiefFinancialOfficial:MaYun PersoninChargeofAccountingOrganization:MaoChunhua BALANCESHEET(CONTINUED) PreparedbyDalianRefrigerationCo.,Ltd. March31,2017 Unit:RMBYuan Liabilitiesandshareholders’equity 31-Mar-2017 31-Dec-2016 Consolidation ParentCompany Consolidation ParentCompany Currentliabilities: Short-termloans 45,000,000.00 45,000,000.00 Derivativefinancialliabilities Notespayable 183,822,731.78 106,828,117.52 179,378,767.96 85,834,371.87 Accountspayable 882,550,983.30 302,144,680.65 839,079,506.68 340,987,669.38 Accountsreceivedinadvance 101,058,752.60 37,585,659.39 136,231,829.62 74,949,113.25 Wagepayable 24,762,134.09 1,700,979.68 49,117,130.73 9,796,460.53 Taxespayable 14,137,565.62 795,267.08 18,114,263.03 1,234,137.19 Interestpayable Dividendpayable 863,516.60 533,156.00 863,516.60 533,156.00 Otheraccountspayable 104,906,158.36 77,968,026.54 105,262,888.56 74,954,775.74 Liabilitiesheldforsale Non-currentliabilitiesduewithinoneyear Othercurrentliabilities Totalcurrentliabilities 1,357,101,842.35 527,555,886.86 1,373,047,903.18 588,289,683.96 Non-currentliabilities: Long-termloans 160,000,000.00 160,000,000.00 160,000,000.00 160,000,000.00 Bondspayable Long-termaccountpayable Long-termwagepayable Deferredincome 56,980,202.00 12,698,701.00 57,396,619.00 12,836,619.00 Deferredincometaxliabilities 74,225,138.31 74,225,138.31 75,683,681.95 75,683,681.95 Othernon-currentliabilities Totalnon-currentliabilities 291,205,340.31 246,923,839.31 293,080,300.95 248,520,300.95 Totalliabilities 1,648,307,182.66 774,479,726.17 1,666,128,204.13 836,809,984.91 Shareholders’equity Sharecapital 611,776,558.00 611,776,558.00 611,776,558.00 611,776,558.00 Otherequityinstruments Capitalpublicreserve 1,025,808,127.25 1,039,236,514.54 1,022,686,774.25 1,036,115,161.54 Less:Treasurystock 67,615,856.00 67,615,856.00 67,615,856.00 67,615,856.00 Othercomprehensiveincome 423,374,242.86 422,148,476.11 431,639,323.52 430,413,556.77 Specialpreparation Surpluspublicreserve 620,578,847.52 620,578,847.52 620,578,847.52 620,578,847.52 Retainedprofit 662,029,576.19 548,749,059.70 628,732,121.63 498,962,843.33 Translationofforeigncurrencycapital Totalowner’sequityattributabletoparentcompany 3,275,951,495.82 3,174,873,599.87 3,247,797,768.92 3,130,231,111.16 Minorityinterests 70,039,786.40 69,585,601.21 Totalowner’sequity 3,345,991,282.22 3,174,873,599.87 3,317,383,370.13 3,130,231,111.16 Totalliabilitiesandshareholder’sequity 4,994,298,464.88 3,949,353,326.04 4,983,511,574.26 3,967,041,096.07 LegalRepresentative:JiZhijian ChiefFinancialOfficial:MaYun PersoninChargeofAccountingOrganization:MaoChunhua INCOMESTATEMENT PreparedbyDalianRefrigerationCo.,Ltd. January-March,2017 Unit:RMBYuan January-March,2017 January-March,2016 Items Consolidation ParentCompany Consolidation ParentCompany I.Totalsales 474,819,352.69 191,248,157.66 400,592,922.66 115,257,669.44 Including:Operatingincome 474,819,352.69 191,248,157.66 400,592,922.66 115,257,669.44 II.Totaloperatingcost 471,384,913.21 190,640,540.70 398,206,658.93 113,475,549.87 Including:Operatingcost 402,792,585.16 166,603,901.44 333,650,668.53 94,264,744.26 Taxesandassociatecharges 3,075,268.64 1,649,780.92 2,902,901.06 7,097.13 Sellinganddistributionexpenses 18,242,995.92 652,777.41 17,501,000.87 607,607.24 Administrativeexpenses 48,547,762.05 23,933,429.36 47,439,360.72 24,185,343.28 Financialexpense 426,919.78 124,728.04 1,380,437.76 -226,882.57 Impairmentloss -1,700,618.34 -2,324,076.47 -4,667,710.01 -5,362,359.47 Add:Gain/(loss)fromchangeinfairvalue Gain/(loss)frominvestment 31,687,715.50 49,316,482.17 24,957,721.61 24,957,721.61 Including:incomeforminvestmentonaffiliated 20,534,146.45 20,534,146.45 24,647,721.61 24,647,721.61 enterpriseandjointlyenterprise III.Operatingprofit 35,122,154.98 49,924,099.13 27,343,985.34 26,739,841.18 Add:non-businessincome 1,037,799.89 210,728.71 484,226.19 156,552.57 Including:profitfromnon-currentassetdisposal 72,310.71 72,310.71 64,284.56 18,634.56 Less:non-businessexpense 19,842.24 22,667.47 4,974.62 Including:lossfromnon-currentassetdisposal 5,319.37 4,974.62 IV.Totalprofit 36,140,112.63 50,134,827.84 27,805,544.06 26,891,419.13 Less:Incometax 2,388,472.88 348,611.47 2,239,323.88 1,512,936.68 V.Netprofit 33,751,639.75 49,786,216.37 25,566,220.18 25,378,482.45 Netprofitattributabletoparentcompany 33,297,454.56 49,786,216.37 25,527,518.21 25,378,482.45 Minorityshareholders’gainsandlosses 454,185.19 38,701.97 VI.After-taxnetamountofothercomprehensive -8,265,080.66 -8,265,080.66 -107,197,214.54 -107,197,214.54 incomes After-taxnet amount ofothercomprehensive -8,265,080.66 -8,265,080.66 -107,197,214.54 -107,197,214.54 incomesattributabletoownersoftheCompany (I)Othercomprehensiveincomesthatwillnotbe reclassifiedintogainsandlosses 1.Changesin netliabilitiesorassetswitha definedbenefitplanuponre-measurement 2.Enjoyablesharesinothercomprehensive incomesininvesteesthatcannotbereclassified intogainsandlossesundertheequitymethod …… (II)Othercomprehensiveincomesthatwillbe -8,265,080.66 -8,265,080.66 -107,197,214.54 -107,197,214.54 reclassifiedintogainsandlosses 1. Enjoyable shares in other comprehensive incomesininvesteesthatwillbereclassifiedinto gainsandlossesundertheequitymethod 2.Gainsandlossesonfairvaluechangesof -8,265,080.66 -8,265,080.66 -107,197,214.54 -107,197,214.54 available-for-salefinancialassets 3.Gainsandlossesonreclassifying held-to-maturityinvestmentsinto available-for-salefinancialassets 4.Effectivehedginggainsandlossesoncash flows 5.Foreign-currencyfinancialstatement translationdifference 6.Other …… After-taxnetamountofothercomprehensive incomesattributabletominorityshareholders VIITotalcomprehensiveincome 25,486,559.09 41,521,135.71 -81,630,994.36 -81,818,732.09 Total comprehensive income attributable to 25,032,373.90 41,521,135.71 -81,669,696.33 -81,818,732.09 parentcompany Total comprehensive income attributable to 454,185.19 38,701.97 minorityshareholders VIII.Earningspershare (I)basicearningspershare 0.05 0.05 (II)dilutedearningspershare 0.05 0.05 LegalRepresentative:JiZhijian ChiefFinancialOfficial:MaYun PersoninChargeofAccountingOrganization:MaoChunhua CASHFLOWSTATEMENT PreparedbyDalianRefrigerationCo.,Ltd. January-March,2017 Unit:RMBYuan January-March,2017 January-March,2016 Items Consolidation ParentCompany Consolidation ParentCompany I. Cash flows arising from operating activities: Cashreceivedfromsellingcommoditiesand 280,438,062.58 76,710,267.43 259,550,611.17 57,386,660.38 providinglaborservices Write-backoftaxreceived 754,366.35 18,706.02 Other cash received concerning operating 7,875,745.52 1,574,756.48 5,101,358.38 1,872,927.46 activities Subtotalofcashinflowarisingfrom 289,068,174.45 78,285,023.91 264,670,675.57 59,259,587.84 operatingactivities Cashpaidforpurchasingcommoditiesand 273,874,359.36 115,453,705.91 205,022,168.61 62,407,122.34 receivinglaborservice Cashpaidto/forstaffandworkers 102,705,440.26 40,953,327.52 93,063,640.59 37,869,910.32 Taxespaid 18,961,171.48 2,164,084.70 19,094,299.33 3,224,168.93 Other cash paid concerning operating 30,644,978.92 2,660,805.51 37,227,337.55 15,124,172.44 activities Subtotalofcash outflowarisingfrom 426,185,950.02 161,231,923.64 354,407,446.08 118,625,374.03 operatingactivities Netcashflowsarisingfromoperating -137,117,775.57 -82,946,899.73 -89,736,770.51 -59,365,786.19 activitiesII. Cash flows arising from investingactivities: Cashreceivedfromrecoveringinvestment Cashreceivedfrominvestmentincome 11,192,594.05 21,153,569.05 44,600.00 Netcashreceived fromdisposaloffixed, 120,520.00 43,040.00 43,000.00 intangibleandotherlong-termassets Net cash received from disposal of subsidiariesandotherunits Other cash received concerning investing activities Subtotalofcashinflowfrominvesting 11,313,114.05 21,153,569.05 87,640.00 43,000.00 activities Cashpaidfor purchasingfixed,intangible 24,831,200.35 18,105,516.46 38,795,973.03 33,240,785.00 andotherlong-termassets Cashpaidforinvestment 39,200,000.00 39,200,000.00 Net cash received from payment of subsidiariesandotherbusinessunits Other cash paid concerning investing activities Subtotalofcashoutflowfrominvesting 64,031,200.35 57,305,516.46 38,795,973.03 33,240,785.00 activities Netcashflowsarisingfrominvesting -52,718,086.30 -36,151,947.41 -38,708,333.03 -33,197,785.00 activitiesIII. Cash flows arising from financingactivities Cashreceivedfromabsorbinginvestment Including: Cash received from absorbing minorityshareholders'equityinvestmentby subsidiaries Cashreceivedfromloans 22,500,000.00 178,150,000.00 160,000,000.00 Other cash received concerning financing 21,576,815.56 23,110,827.68 1,920,332.73 activities Subtotalofcashinflowfromfinancing 44,076,815.56 201,260,827.68 161,920,332.73 activities Cashpaidforsettlingdebts 24,000,000.00 17,751,087.50 Cashpaidfordividendandprofitdistributing 1,123,770.83 480,000.00 1,179,397.92 307,318.34 orinterestpaying Including: dividends or profit paid by subsidiariestominorityshareholders Other cash paid concerning financing 11,632,035.91 4,924,665.45 3,430,000.00 activities Subtotalofcashoutflowfromfinancing 36,755,806.74 480,000.00 23,855,150.87 3,737,318.34 activities Netcashflowsarisingfromfinancing 7,321,008.82 -480,000.00 177,405,676.81 158,183,014.39 activitiesIV.Influenceoncashduetofluctuationin 168,075.99 -320.32 4,105.12 1,000.65exchangerate V.Netincreaseofcashandcashequivalents -182,346,777.06 -119,579,167.46 48,964,678.39 65,620,443.85 Add:Balanceofcashandcashequivalentsat 655,747,990.20 495,217,106.54 221,724,134.60 147,439,134.15 theperiod-begin VI.Balanceofcashandcashequivalentsat 473,401,213.14 375,637,939.08 270,688,812.99 213,059,578.00 theperiod�Cend LegalRepresentative:JiZhijian ChiefFinancialOfficial:MaYun PersoninChargeofAccountingOrganization:MaoChunhua