Stockcode:000726,200726 Stockname:LuThaiA,LuThaiB AnnouncementNo.:2017-018 LuThaiTextileCo.,Ltd. AbstractoftheReportfortheFirstQuarterof2017 SectionIImportantStatements TheBoardofDirectors,theSupervisoryCommittee,directors,supervisorsand seniormanagementstaffofLuThaiTextileCo.,Ltd.(hereinafterreferredtoas “theCompany”)warrantthattheinformationcarriedinthisreportis factual, accurate and complete, without any false record, misleading statement or materialomission.Andtheyshallbejointlyandseverallyliableforthat. Alldirectorshaveattendedtheboardsessionforreviewingthisreport. LiuZibin, company principal, ZhangHongmei, chiefofthe accounting work, andZhangKeming,chiefoftheaccountingorgan(chiefofaccounting),hereby confirmthatthefinancialstatementsenclosedinthisreportarefactual,accurate andcomplete. SectionIICompanyProfile IFinancialresults WhethertheCompanyperformedanyretroactiveadjustmentstoorrestatementofitsaccountingdataduetochangesofaccounting policiesorcorrectionofaccountingerrors □Yes√No January-March2017 January-March2016 +/-% Operatingrevenues(RMB) 1,273,058,505.40 1,282,806,624.05 -0.76% Netprofitattributabletoshareholdersof 157,994,708.53 150,268,522.21 5.14% theCompany(RMB) Netprofitattributabletoshareholdersof theCompanybeforeexceptionalprofitand 155,049,414.60 137,542,633.98 12.73% loss(RMB) Netoperatingcashflow(RMB) -73,576,928.32 183,258,282.60 -140.15% Basicearningspershare(RMB/share) 0.17 0.16 6.25% Dilutedearningspershare(RMB/share) 0.17 0.16 6.25% Weightedaveragereturnonequity 2.25% 2.15% 0.10% 31March2017 31December2016 +/-% Totalassets(RMB) 9,599,617,156.96 9,407,103,263.34 2.05% Netassetsattributabletoshareholdersof 7,092,096,902.20 6,937,985,729.19 2.22% theCompany(RMB) Exceptionalprofitandloss √Applicable□Notapplicable Unit:RMB Item January-March2017 Note Profit/lossondisposalofnon-currentassets(includingoffsetamountofasset -1,173,169.92 impairmentprovisions) Governmentgrantschargedtotheprofit/lossfortheReportingPeriod(except forthegovernmentgrantscloselyrelatedtothebusinessoftheCompanyand givenatafixedquotaoramountinaccordance withtheState’suniform 6,131,296.64 standards)Gainsandlossesonchangeinfairvaluefromtradablefinancialassetsandtradablefinancialliabilities,aswellasinvestmentincomefromdisposaloftradablefinancialassetsandtradablefinancialliabilitiesandfinancialassets 598,500.00availableforsales,exceptforeffectivehedgingrelatedwithnormalbusinessesoftheCompanyNon-operatingincomesandexpensesotherthantheabove -1,971,535.35 Less:Incometaxeffects 541,344.60 Minorityinterestseffects(aftertax) 98,452.84 Total 2,945,293.93 -- ExplanationofwhytheCompanyclassifiedanitemasexceptionalprofit/lossaccordingtothedefinitionintheExplanatory AnnouncementNo.1onInformationDisclosureforCompaniesOfferingTheirSecuritiestothePublic―ExceptionalProfitandLoss, orreclassifiedanyexceptionalprofit/lossitemgivenasanexampleinthesaidexplanatoryannouncementtorecurrentprofit/loss □Applicable√Notapplicable NosuchcasesintheReportingPeriod. IITotalnumberofshareholdersattheperiod-endandshareholdingsoftoptenshareholders 1.Numbersofcommonshareholdersandpreferenceshareholderswithresumedvotingrightsaswellas shareholdingsoftoptenshareholders Unit:share Totalnumberofpreference Totalnumberofcommon 62,320shareholderswithresumedvoting 0 shareholdersattheperiod-end rightsattheperiod-end(ifany) Shareholdingsoftoptenshareholders Shareholdi Pledgedorfrozen Numberof shares Natureof ng Numberof Nameofshareholder restrictedshares shareholder percentage sharesheld Statusof Number held (%) shares ofshares Domestic ZIBO LUCHENG TEXTILE non-state-owned 15.21% 140,353,583 INVESTMENTCO.,LTD. corporation TAILUNTEXTILECO.,LTD. Foreigncorporation 12.82% 118,232,400 118,232,400 CENTRAL HUIJIN ASSETSState-owned 2.20% 20,315,300 MANAGEMENT CO.,LTD. corporation T.ROWEPRICEINTLDISCOVERY Foreigncorporation 2.16% 19,948,219 FUNDCHINASECURITIESFINANCE State-owned 1.70% 15,679,091CORPORATIONLIMITED corporationLYNASASIAFUND Foreigncorporation 1.35% 12,440,000HONGKONGSECURITIES Foreigncorporation 1.18% 10,864,371CLEARINGCOMPANYLTD.HUAANNEWSILKROADTHEME Domestic 1.11% 10,205,505EQUITYSECURITIESINVESTMENTnon-state-ownedFUND corporation BNPPARIBAS Foreigncorporation 0.88% 8,131,797 FIRSTSTATECHINAASHARE Foreigncorporation 0.80% 7,352,381 FUND Shareholdingsoftoptennon-restrictedshareholders Numberof Varietyofshares Nameofshareholder non-restrictedshares held Variety Number RMBcommonZIBOLUCHENGTEXTILEINVESTMENTCO.,LTD. 140,353,583shares RMBcommon CENTRALHUIJINASSETSMANAGEMENT CO.,LTD. 20,315,300 shares Domestically T.ROWEPRICEINTLDISCOVERYFUND 19,948,219listedforeign shares RMBcommon CHINASECURITIESFINANCECORPORATIONLIMITED 15,679,091 shares Domestically LYNASASIAFUND 12,440,000listedforeign shares RMBcommon HONGKONGSECURITIESCLEARINGCOMPANYLTD. 10,864,371 shares HUAANNEWSILKROADTHEMEEQUITYSECURITIES RMBcommon 10,205,505 INVESTMENTFUND shares RMBcommon BNPPARIBAS 8,131,797 shares RMBcommon FIRSTSTATECHINAASHAREFUND 7,352,381 shares Domestically HTHK-MANULIFECHINAVALUEFUND 6,858,138listedforeign shares ZiboLuchengTextileInvestmentCo.,Ltd.isthelargest shareholder oftheCompanyandtheactualcontroller. Tailun(Thailand)TextileCo.,Ltd.isthesecondlargest shareholderaswellassponsorofforeigncapitalofthe Relatedoracting-in-concertpartiesamongtheaboveshareholders Company.Allofothershareholdersarepeopleholding circulatingAshareorcirculatingBshareandtheCompany is not able to confirm whether there is associated relationshiporconcertedactionamongothershareholders. Toptencommonshareholdersconductingsecuritiesmargintrading(if N/A any)Didanyofthetoptencommonshareholdersorthetoptennon-restrictedcommonshareholdersoftheCompanyconductanypromissoryrepoduringtheReportingPeriod□Yea√NoNosuchcasesintheReportingPeriod.2.Totalnumberofpreferenceshareholdersandshareholdingsofthetoptenofthem□Applicable√Notapplicable SectionIIISignificantEvents IChangesinmajorfinancialdataandindicatorsfortheReportingPeriod,aswellasreasons forsuchchanges √Applicable□Notapplicable Assetsitems: (1)OtheraccountsreceivablestoodatRMB31,955,559.44 onMarch31,2017,downby30.93% fromthe openingamount,mainly because exportrebatesthat shouldbe received atbeginning periodwerereceivedincurrentperiod. (2)OthercurrentassetsstoodatRMB57,017,887.67onMarch31,2017,downby46.98%fromthe openingamount,mainlybecausethesoldstockwastransferredoutfromthesecuritiesaccountin thecurrentperiod. (3)EngineeringmaterialsstoodatRMB199,826,672.33onMarch31,2017,upby70.62%fromthe openingamount,mainlybecauseLuThai(Vietnam)equipmenttobeinstalledincreased. (4)Othernon-currentassetsstoodatRMB17,484,641.71onMarch31,2017,downby44.07% fromtheopeningamount,mainlybecausetheadvancepaymentforlandofXinJiangLuThaiwas transferredintointangibleassets. Liabilitiesandowners’equityitems: (5)NotespayablestoodatRMB6,423,218.00onMarch31,2017,upby100.00%fromtheopening amount,mainlybecausecommercialacceptancebillspayableinthecurrentperiodincreased. (6)PayrollpayablestoodatRMB199,084,558.19onMarch31,2017,downby36.92%fromthe openingamount,mainlybecausetheyear-endbonusesforemployeesfor2016were paidinthe currentperiod. Incomestatementitems (7)TaxesandsurtaxesstoodatRMB22,303,687.92forJanuary-March2017,upby80.13% from theyearearlier, mainlybecausethetaxesitemsinitiallyrecordedinadministrationexpensewas recordedinthistitleinthecurrentperiodaccordingtoVATAccountingRulesCK[2016]No.22. (8)FinancialexpensestoodatRMB12,204,861.91forJanuary-March2017,upby230.27%from theyearearlier, mainlybecausenetexchangelossincreased. (9)AssetimpairmentlossstoodatRMB-3,651,249.64forJanuary-March2017,downby319.63% fromthesameperiodoflastyear,mainlybecauseclosingaccountsreceivabledecreasedresultingto thedecreaseofprovisionforAssetimpairmentloss. (10)ProfitonfairvaluechangesstoodatRMB0.00forJanuary-March2017,downby100.00% fromthesameperiodoflastyear,mainlybecausetherewasnofairvaluechangesclosingfinancial liabilitiesattheperiod-end.. (11)InvestmentprofitstoodatRMB598,500.00forJanuary-March2017,upby103.51%fromthe yearearlier, mainlybecauseprofitoninvestmentinfinancialderivativeinstrumentsincreased. (12)Non-operatingexpensesstoodatRMB4,374,164.43forJanuary-March2017,upby382.06% fromtheyearearlier, mainlybecauseof thepayment forendowmentsfortheLightofTextile ScienceandTechnologyEducationFundsinthecurrentperiod.. Cashflowstatementitems: (13)NetcashflowfromoperationactivitiesstoodatRMB-73,576,928.32forJanuary-March2017, downby140.15%fromtheyearearlier,mainly duetotheincreaseofrawcottonprocurement, whichincreasedthecashpaymentforproductsandservices. (14)NetcashflowfrominvestingactivitiesstoodatRMB-108,083,010.35forJanuary-March2017, upby35.84%fromtheyearearlier,mainly becausethesold stockwasreceivedin thecurrent period.(15)NetcashflowfromfinancingactivitiesstoodatRMB170,780,237.10forJanuary-March2017,upby807.87%fromtheyearearlier,mainlybecausethecashpaymentforrepayingdebtdecreasedinthecurrentperiod.IIProgressofsignificanteventsandanalysis&explanationsontheirinfluenceandsolutions□Applicable√ NotapplicableIIICommitmentsof theCompany,its shareholders,actual controller,acquirer, directors,supervisors,seniormanagementorotherrelatedpartiesfulfilledintheReportingPeriodorongoingattheperiod-end□Applicable√ NotapplicableNosuchcasesintheReportingPeriod.IVOperatingresultforecastforJanuary-June2017ForecastofapossibledeficitorconsiderableYoYchangeintheaccumulativenetprofitmadeduringtheperiodfromthebeginningoftheyeartotheendofthenextreportingperiod,aswellasexplanationofwhy:□Applicable√NotapplicableVSecuritiesinvestments□Applicable√NotapplicableNosuchcasesintheReportingPeriod.VIInvestmentinfinancialderivatives√Applicable□Notapplicable Unit:RMB’0,000 Ope Proporti Relate Amount Actual ning Amount Closin onof d-part Initial purchased Impairm gain/lo Typeof inve soldin g closingOperatRela y investmeBeginning Ending in ent ssin derivative stme reporting invest investm or tiontransac nt date date reporting provision reporti investment nt period ment ent tionor amount period (ifany) ng amo amount amount not period unt inthe Compan y’s closing net assets (%) CommNon- Forward 01/19/201 03/28/201 ercial relat No exchange 0 0 17,967.4317,967.43 0 0.00% 58.95 7 7 bank ed settlement CommNon- Option 01/03/201 04/07/201 ercial relat No 0 0 2,769 696 2,073 0.27% 0.9 portfolio 7 7 bank ed Total 0 20,736.4318,663.43 2,073 0.27% 59.85 Capital source for derivative Ownfunds investmentLawsuit(ifapplicable) NolawsuitsDisclosure date of board05/19/2016announcementon approvalofderivativeinvestment(ifany)Disclosure date of generalmeeting announcement onapproval of derivativeinvestment(ifany) TheCompanyconductedderivativesproductstransactioninorderforhedging.Andtheforward settlementhedgingwasoperatedbyinstallments,withtherelevantamountnotmorethanthe planned derivatives products transactions. And all derivatives products transaction was zero-deposit.Meanwhile,theCompanyhadacompleteriskcontrolsystemforsufficientanalysis andpreventionofpossibleriskssuchasriskoflawsandregulations,creditrisk,operationriskand marketrisk.Riskanalysisandriskcontrol1.Riskconcerninglawsandregulations:measures for derivative TheCompanyconductedderivativesproductstransactioninstrictaccordancewithrelevantlawsproducts held in reporting andrulesaswellasregulatorypoliciesfromgovernmentsecuritiesregulatoryauthorities,ifthereperiod(includingbutnotlimited werenostandardoperationproceduresandstrictapprovalprocedures,itwaseasytocauseto market risk, liquidity risk, compliantandregulatoryrisksexistinginthevalidityandfeasibilityofcontract,commitmentscreditrisk,operationrisk,legal andotherlegaldocumentssigned.risk,etc.) Riskcontrolmeasures:TheCompanycarefullystudiedandmasteredlaws,regulationsand policiesrelevanttoderivativeproductstransaction,formulatedinternalcontrolrulesforthe forwardsettlementhedgingbusiness,standardizedtheoperationprocedures.Andstrengthenedthe compliantexaminationonderivativeproductsinvestmentbusiness,andstrictlyabidedbyrelevant laws,regulationsandtheCompany’sinternalmanagementrules. 2.Creditriskandliquidityrisk:Whenthecontractmatures,theCompanycouldn’tdeliverasscheduledduetoinsufficient liquidity,andthecounterpartyortheCompanycouldn’tfulfillthecontractduetootheraspects excepttheliquidity,whichwouldcausecreditriskandfurthereconomiclossesfortheCompany. Riskcontrol measures:the Company chose thepowerfulfinancial institutions with good reputationasthecounterparty,andsignedstandardderivativeproductstransactioncontract,as wellasstrictlycontrolledthecreditriskofcounterparty.TheCompanyconductedderivative investmenttransactionsaccordingtotherelevantapprovalprocedure,whichwasinlinewith relevantlaws,regulations,theCompany’sArticlesofAssociation,theManagementRulesfor DerivativeInvestmentofLuThaiTextileCo.,Ltd.andtheProposalonthePlanofLuThaiTextile Co.,Ltd.forDerivativeTransactionsin2016approvedatthe33thSessionofthe7thBoardof Directorson17May,2016,andperformedrelevantinformationdisclosureresponsibilities.The Companydecidedtheuplimitfortheamountofderivativeproductstransactionaccordingtothe productionandoperationscaleandtheprogressofforeignexchangeincomefortheCompany, anddeliveredbyphases.Itwasalsopossibletouseextensionoftermandotherwaystoensurethe fulfillmentofcontractasschedulesuponthematureofcontract,andwouldn’tcauseanylossof creditriskfortheCompanyduetoinsufficientliquidityorotherreasons. 3.Operationrisk: Thederivativefinancialtransactionshadhighspecialtyandcomplexity,soimperfectinternal operationprocedures,staffsandexternaleventswouldmaketheCompanytoundertakerisks duringthetransaction. Riskcontrolmeasures:TheCompanypromulgatedstrictauthorizationandapprovalsystemand perfect regulatory mechanism, fixed the departments, operation procedures and approval proceduressystemtoconductderivativeproductstransaction,establishedspecialriskcontrol positions,implementedstrictauthorizationandpostchecksandbalancessystem,meanwhile,it improvedtheoverallqualityofrelevantpersonnelthroughstrengtheningthebusinesstrainingand professionalethicseducationforthem.Besides,itestablishedtheSystem ofReportingthe AbnormalSituationTimely,formedanefficientriskmanagementprocedures,soastoensureto lowertheoperationriskstothemaximum. 4.Marketrisk: SincetheRMBexchangeratereformon8Nov.2015,thereformtowardsamarket-basedRMB exchangerateregimehassteppedintoanewstage.Intheshortrun,thereissomedepreciation pressureontheRMB,butasharpdepreciationisconsideredunlikely.Inthelongrun,thepositive economicfundamentalsof China,thelargesurplusofthecurrent accountsandthefaster globalizationoftheRMBwillenabletheRMBtoremainastrongcurrency.Inthenearfuture,the RMBexchangerateisexpectedtobemoreflexiblewithadistinctfeatureofbidirectional volatilityandstablewithinarationalandbalancedrange.Theforwardsettlementofexchangeand theoptionbusinessisimportantderivativeproducttransactionsoftheCompany,whichwas significantlyaffectedbytheexchangeratefluctuation.IftheRMBisdevaluedbyalargemargin onthebasisofthecurrentsituationbeforethecontractisdue,sothen,thelargerlossesshallincur inthecontractonforwardsettlementofexchangeoroptionsignedbytheCompany. Riskcontrolmeasures:AlthoughamoreflexibleRMBexchangerateandtheincreased fluctuationrangeaddedtotheoperationdifficulty,itprovidedacertainopportunity.Therefore,the relevantpersonneloftheCompanywillactivelyanalyzemarketchanges,carefullyoperateand holdpositiveopportunity,soastotrythebesttoreducethemarketrisksundertheconditionof increasedmarketdifficulty. Changesinmarketpricesorfair1.Upto31March2017,theCompanyheld1unduefinancialderivativeproductcontract,totaling valueofinvestedderivativesinUSD3million, whichwillbedue inApril2017.Thefinancial derivativeproductsabove reporting period (fair valueaccountedfor0.27%oftheclosingnetassets. analysisshouldincludespecific2.FromJanuary-March2017,theduefinancialderivativeproductsoftheCompanytotally analysis methods as well asequaledtoUSD27million,andtherevenuegeneratedwasRMB598.5thousand.Tobespecific, relevant assumptions andthedueforwardsettlementwasUSD26million,generatingprofitofRMB589.5thousand;thedue parameters) foreignexchangeoptionsequaledtoUSD1million,generatingprofitofRMB9thousand, Significant changes in theNosignificantchanges Company’s accounting policy and specific accounting principles for derivatives in reporting period when comparedtolastperiod TheCompany’sindependentdirectorsXuJianjun,ZhaoYao,BiXiuli,PanAilingandWang Xinyu,concerningconductingderivativesbusiness,haveissuedthefollowingprofessionaladvice: WeareoftheopinionthatitwillstrengthentheCompany’scompetitivenesstousederivative Specific opinion from transactionswithfocusonforwardsettlementandpurchaseasaneffectivetooltoavoidforeign independent directors on the Company’s derivativesexchangerisks,tostrengthentherelevantinternalcontrolandtocarryoutthelossandrisk preventionmeasuressoastoimprovetheoperationandmanagement.Inconductingderivative investmentandriskcontrol transactionswithfocusonforwardsettlementandpurchase,theCompanyfollowsalegal approvalprocedure,hassoundrelevantinstitutionsandkeepstherisksrelativelycontrollable.No harmhasbeendonetotheinterestsoftheCompany’sshareholders. VII Visits paid to the Company in the Reporting Period for purposes of research, communication,interview,etc. √Applicable□Notapplicable Dateofvisit Wayofvisit Typeofvisitor Indextomaininquiryinformation Seedetailsfrom"RecordofInvestorRelationsEventsand 02/23/2017 Fieldresearch Institution DailyInvestorRelationsEventsof02/23/2017”on www.cninfo.com.cn Seedetailsfrom"RecordofInvestorRelationsEventsand Telephone DailyInvestorRelationsEventsof03/30/2017”on 03/30/2017 Institution communication www.cninfo.com.cn VIIIIllegalprovisionofguaranteesforexternalparties □Applicable√Notapplicable NosuchcasesintheReportingPeriod. IXOccupationoftheCompany’sfundsbythecontrollingshareholderoritsrelatedparties fornon-operatingpurposes □Applicable√Notapplicable NosuchcasesintheReportingPeriod. BoardChairman:LiuZibin LuThaiTextileCo.,Ltd. 28April2017