Financial Performance - In the first half of 2019, the group recorded revenue of approximately RMB 17,431 million, a year-on-year decrease of about 7.1%[8] - The group achieved a gross profit of approximately RMB 2,051 million, down approximately 11.0% year-on-year, primarily due to weak new car sales[8] - The net profit attributable to equity holders was approximately RMB 471 million, with basic earnings per share of approximately RMB 0.192, both down about 33.8% year-on-year[8] - New car sales revenue was approximately RMB 14,099 million, down about 10.8% from RMB 15,805 million in the first half of 2018, accounting for 80.9% of total revenue[48] - After-sales service revenue increased by approximately 7.8% to RMB 2,435 million, representing 14.0% of total revenue, up 2.0 percentage points year-on-year[48] - The group's gross profit for the first half of 2019 was approximately RMB 2,051 million, a decrease of about 11.0% from RMB 2,304 million in the same period of 2018[52] - The gross profit margin was approximately 11.8%, down 0.5 percentage points from 12.3% in the first half of 2018[52] - The group's operating profit for the six months ended June 30, 2019, was approximately RMB 1,305 million, a decrease of about 14.5% compared to RMB 1,526 million in the first half of 2018[55] - The net profit for the same period was approximately RMB 520 million, down about 28.4% from RMB 726 million in the first half of 2018[59] - The company reported a decrease in other income to RMB 386,475 from RMB 471,227 in the previous year, a decline of 18.0%[115] - The profit before tax was RMB 767,608, down 28.8% from RMB 1,079,878 in 2018[115] Sales and Market Trends - New car sales totaled 52,060 units in the first half of 2019, a year-on-year decline of approximately 5.6%, with luxury and ultra-luxury brand sales at 40,869 units, down about 3.8%[11] - The luxury car market in China saw a 9.0% year-on-year increase in sales, totaling 1,440,000 units in the first half of 2019, despite an overall decline in the passenger car market[4] - The second-hand car market saw a total of 6,862,000 transactions in the first half of 2019, marking a year-on-year growth of 3.9%[16] After-Sales and Service - The after-sales service business achieved a total of 705,610 service instances in the first half of 2019, representing a year-on-year increase of approximately 14.1%[14] - After-sales revenue reached approximately RMB 2,435 million, a year-on-year growth of 7.8%, with a gross profit of approximately RMB 1,127 million and a gross margin of about 46.3%[14] - The company is actively exploring new business models and revenue growth points in the after-sales service sector to enhance customer experience and loyalty[15] Financial Services - The financial services segment generated interest and service income of approximately RMB 466 million, an increase of 27.7% compared to the same period last year[20] - The net amount of customer loans and advances increased from RMB 8,426 million to RMB 9,969 million, reflecting a growth rate of 18.3%[20] - The non-performing loan ratio for Dongzheng Automotive Finance was 0.33%, with a loan provision ratio of 1.57% and a provision coverage ratio of 471.01%[20] - Dongzheng Automotive Finance aims to establish a comprehensive automotive financial ecosystem, providing a one-stop service for all automotive-related financial products[20] Operational Efficiency and Management - The group is developing a data-driven management platform to optimize inventory management and improve operational efficiency[12] - The group continues to strengthen partnerships with luxury car manufacturers and is committed to enhancing customer service experience through refined management and innovative practices[4] - The group is focusing on strategic mergers and innovative operational cooperation models to enhance business scale and profitability[39] - The group has partnered with Tencent Technology to develop a new generation "cloud platform" operational management system to improve service capabilities and customer experience[45] - The group is implementing a tiered management system for dealerships to enhance performance evaluation and resource allocation[47] Expansion and Network Development - The number of dealers in the sales network increased from 1,280 as of December 31, 2018, to 1,373 as of June 30, 2019[23] - The company operates 141 dealership outlets across 41 cities in 17 provinces and municipalities as of June 30, 2019, with plans to expand further into new regions[37] - The company has authorized 13 new dealership outlets, focusing on luxury and super-luxury automotive brands, enhancing its competitive advantage in traditional and rapidly developing regions[37] Logistics and Infrastructure - The company is expanding its logistics infrastructure with the construction of a multi-modal logistics base in Wuhan, expected to be completed by the end of 2020[34] - The company has introduced strategic investors to enhance its logistics capabilities and improve operational efficiency, aiming for sustained revenue growth[35] Shareholder and Capital Management - Joy Capital Holdings Limited holds 1,383,516,820 shares, representing 56.42% of the company's equity as of June 30, 2019[76] - Citigroup Inc. holds 62,578,459 shares, accounting for 2.55% of the company's equity, as well as additional controlled entity interests[80] - The company declared an interim dividend of HKD 0.10 per share for the six months ending June 30, 2019, to be paid on or around October 25, 2019[102] - The company completed a placement of 226 million new shares at HKD 7.70 per share, raising approximately HKD 1,727 million for the development of its automotive finance business[101] Accounting and Financial Reporting - The company has adopted the revised Hong Kong Financial Reporting Standard No. 16 from January 1, 2019, without restating comparative figures[116] - The adoption of Hong Kong Financial Reporting Standard 16 ("Leases") has been implemented since January 1, 2019, affecting the accounting treatment of leases[150] - The initial measurement of lease liabilities is based on the present value of lease payments, discounted using the interest rate implicit in the lease or the incremental borrowing rate[153] - The Group's lease liabilities as of January 1, 2019, amounted to RMB 1,730,954,000 after applying the Hong Kong Financial Reporting Standard 16[165] Employee and Operational Metrics - As of June 30, 2019, the group employed 12,053 employees in China, a decrease from 12,353 employees as of December 31, 2018[73] - Total employee costs for the six months ended June 30, 2019, were approximately RMB 453 million, compared to RMB 425 million for the same period in 2018, representing a year-over-year increase of 6.6%[73] Future Outlook - The group anticipates steady growth in China's macro economy and an increase in disposable income, leading to a gradual rise in demand for luxury vehicles[74] - The competitive landscape has shifted from an incremental market to a stock market, with consumers demanding higher quality and service from automotive products[74] - The group aims to enhance operational efficiency and innovate management practices by leveraging its diversified luxury brand portfolio and advanced automotive fintech platform[74]

[Company Overview](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E7%B0%A1%E4%BB%8B) [Company Profile](index=4&type=section&id=%E5%85%AC%E5%8F%B8%E7%B0%A1%E4%BB%8B) China ZhengTong Auto Services Holdings Limited is a leading 4S dealership group in China focusing on luxury and ultra-luxury automobile brands[5](index=5&type=chunk) - The company's core business is the distribution of luxury and ultra-luxury car brands, including Porsche, Mercedes-Benz, BMW, and Audi[5](index=5&type=chunk) - As of December 31, 2018, the company operated **140 outlets** in 40 cities across 16 provinces and municipalities, covering first, second, and third-tier cities[5](index=5&type=chunk) - The company is actively promoting financial services such as auto finance, financing leases, and insurance agencies to achieve strategic transformation and sustainable growth[6](index=6&type=chunk) [Five-Year Financial Summary](index=5&type=section&id=%E4%BA%94%E5%B9%B4%E8%B2%A1%E5%8B%99%E6%A6%82%E8%A6%81) [Five-Year Financial Summary](index=5&type=section&id=%E4%BA%94%E5%B9%B4%E8%B2%A1%E5%8B%99%E6%A6%82%E8%A6%81) The company demonstrated steady growth from 2014 to 2018, with revenue increasing from RMB 30.9 billion to RMB 37.5 billion and total assets expanding significantly **Five-Year Performance Summary (2014-2018)** | Metric (RMB in thousands) | 2014 | 2015 | 2016 | 2017 | 2018 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Revenue** | 30,910,087 | 29,361,499 | 31,519,255 | 35,474,325 | 37,455,510 | | **Profit Before Tax** | 1,175,055 | 921,779 | 790,798 | 1,753,791 | 1,889,488 | | **Profit for the Year** | 823,538 | 628,662 | 508,359 | 1,211,462 | 1,254,782 | | **Profit Attributable to Equity Shareholders of the Company** | 803,792 | 618,530 | 493,282 | 1,190,795 | 1,224,065 | **Five-Year Asset and Liability Summary (2014-2018)** | Metric (RMB in thousands) | 2014 | 2015 | 2016 | 2017 | 2018 | | :--- | :--- | :--- | :--- | :--- | :--- | | **Total Assets** | 22,182,690 | 23,679,650 | 27,728,910 | 36,939,130 | 44,199,218 | | **Total Liabilities** | 13,885,582 | 14,990,312 | 18,786,749 | 26,585,498 | 31,873,772 | | **Equity Attributable to Shareholders of the Company** | 8,172,075 | 8,588,632 | 8,858,331 | 10,200,811 | 12,143,276 | [Chairman's Statement](index=6&type=section&id=%E4%B8%BB%E5%B8%AD%E5%A0%B1%E5%91%8A%E6%9B%B8) [Chairman's Statement](index=6&type=section&id=%E4%B8%BB%E5%B8%AD%E5%A0%B1%E5%91%8A%E6%9B%B8) The Chairman highlighted the luxury car market's growth despite an overall market decline, crediting the Group's brand portfolio and expansion into auto FinTech - In 2018, China's passenger vehicle sales **decreased by 4.1% year-on-year**, but the luxury car market maintained rapid growth[14](index=14&type=chunk) **Sales Performance of Major Agency Luxury Brands in China for 2018** | Brand | Sales in China (units) | YoY Growth | | :--- | :--- | :--- | | BMW (incl MINI & Rolls-Royce) | 639,953 | +7.7% | | Audi | 660,888 | +11.0% | | Mercedes-Benz | 652,996 | +11.1% | | Volvo | 130,593 | +14.1% | | Porsche | 80,108 | +12.0% | | Jaguar Land Rover | 114,777 | -21.6% | - The Group's strategic focus is on expanding innovative businesses, particularly in financial services, to build a comprehensive auto FinTech platform[18](index=18&type=chunk) - The Group will continue to expand its network, accelerate new store profitability, and enhance service innovation to provide richer auto life services[19](index=19&type=chunk) [Management Discussion and Analysis](index=11&type=section&id=%E7%AE%A1%E7%90%86%E5%B1%A4%E8%A8%8E%E8%AB%96%E8%88%87%E5%88%86%E6%9E%90) [Business Review](index=12&type=section&id=%E6%A5%AD%E5%8B%99%E5%9B%9E%E9%A1%A7) In 2018, the Group's revenue and gross profit grew steadily, driven by strong performance in new car sales, after-sales, and auto FinTech segments **Key Performance Indicators for 2018** | Metric | 2018 Amount (RMB) | YoY Change | | :--- | :--- | :--- | | **Revenue** | 37,456 million | +5.6% | | **Gross Profit** | 4,487 million | +19.1% | | **Profit Attributable to Equity Holders of the Company** | 1,224 million | +2.8% | | **Basic Earnings Per Share** | 49.9 cents | -7.2% | [New Car Sales Business](index=13&type=section&id=%E6%96%B0%E8%BB%8A%E9%8A%B7%E5%94%AE%E6%A5%AD%E5%8B%99) New car sales volume and gross margin increased in 2018, driven by strong demand for luxury models like the BMW 5 Series and Mercedes-Benz GLC **New Car Sales Data for 2018** | Metric | 2018 Data | YoY Growth | | :--- | :--- | :--- | | **Total Sales Volume** | 112,574 units | +3.3% | | **Luxury & Ultra-luxury Brand Sales Volume** | 86,400 units | +8.0% | | **New Car Sales Gross Margin** | 6.1% | +1.2 pp | [After-Sales Service Business](index=13&type=section&id=%E5%94%AE%E5%BE%8C%E6%9C%D_E5%8B%99%E6%A5%AD%E5%8B%99) The after-sales service business achieved stable growth in revenue and gross profit, with a significant increase in the number of vehicles serviced **After-Sales Service Data for 2018** | Metric | 2018 Data (RMB) | YoY Growth | | :--- | :--- | :--- | | **After-sales Revenue** | 4,331 million | +11.1% | | **After-sales Gross Profit** | 2,003 million | +8.9% | | **Vehicles Serviced** | 1,295,657 units | +14.8% | [Used Car Business](index=14&type=section&id=%E4%BA%8C%E6%89%8B%E8%BB%8A%E6%A5%AD%E5%8B%99) The Group is developing its used car business by focusing on trade-in rates and launching a digital platform to enhance operational efficiency - The focus is on increasing the used car trade-in rate for new car sales, with the **average rate exceeding 30%** in key first-tier cities[31](index=31&type=chunk) - A digital information platform and management system for used cars was launched to standardize business processes and improve operational efficiency[31](index=31&type=chunk) [Automotive FinTech Segment](index=14&type=section&id=%E6%B1%BD%E8%BB%8A%E9%87%91%E8%9E%8D%E7%A7%91%E6%8A%80%E6%9D%BF%E5%A1%8A) The auto FinTech segment achieved rapid growth in revenue and profit, driven by the expansion of its core subsidiary Dongzheng Automotive Finance **Financial Services Business Key Data for 2018** | Metric | 2018 Data (RMB) | YoY Growth | | :--- | :--- | :--- | | **Interest and Service Income** | 844 million | +61.7% | | **Reportable Profit** | 621 million | +64.3% | | **Reportable Assets** | 9,714 million | +34.2% | - Subsidiary Dongzheng Automotive Finance's net customer loans and advances **grew by 43.6%** to RMB 8.426 billion, with a low non-performing loan ratio of **0.27%**[33](index=33&type=chunk) - Dongzheng Automotive Finance's partner dealer network expanded significantly from 351 at the end of 2017 to **1,280 by the end of 2018**, covering 182 cities[37](index=37&type=chunk) [Supply Chain Business](index=17&type=section&id=%E4%BE%9B%E6%87%89%E9%8F%88%E6%A5%AD%E5%8B%99) The supply chain business expanded its services by adding rail transport to create a multimodal logistics model and entering the new energy vehicle sector - Subsidiary Shengze Jietong added rail transport services, establishing a **multimodal transport model** combining road, rail, and water[45](index=45&type=chunk) - The business expanded into new energy vehicle supply chain logistics and established one-stop transport channels for imported cars in Tianjin and Shanghai ports[45](index=45&type=chunk) [Network Development](index=18&type=section&id=%E7%B6%B2%E7%B5%A1%E7%99%BC%E5%B1%95) The Group expanded its network to 140 operating outlets by year-end 2018, with a continued focus on opening new luxury brand dealerships **Outlet Details at Year-End 2018** | Outlet Type | Opened | Authorized for Construction | Total | | :--- | :--- | :--- | :--- | | **Luxury & Ultra-luxury 5S/4S Stores** | 100 | 11 | 111 | | **Mid-to-high-end 4S Stores** | 14 | 0 | 14 | | **Luxury Brand City Showrooms** | 18 | 0 | 18 | | **Luxury Brand Authorized Service Centers** | 7 | 1 | 8 | | **Used Car Centers** | 1 | 0 | 1 | | **Total** | **140** | **12** | **152** | [Innovative Management Models to Enhance Operational Quality](index=20&type=section&id=%E5%89%B5%E6%96%B0%E7%AE%A1%E7%90%86%E6%A8%A1%E5%BC%8F%EF%BC%8C%E6%8F%90%E5%8D%87%E7%B6%93%E7%87%9F%E8%B3%AA%E9%87%8F) The Group implemented several refined management measures, including a "Cloud Platform" system and centralized marketing, to improve operational quality - Developed a proprietary **"Cloud Platform"** operational management system to create "Smart 4S Stores" and enhance customer experience[58](index=58&type=chunk) - Integrated marketing operations to establish a unified customer acquisition channel media library, effectively **reducing customer acquisition costs**[59](index=59&type=chunk) - Introduced a performance evaluation system to manage dealerships by tier, helping key stores improve profitability[61](index=61&type=chunk) [Financial Review](index=21&type=section&id=%E8%B2%A1%E5%8B%99%E5%9B%9E%E9%A1%A7) The Group's 2018 financial performance was solid, with increased revenue and gross margin, though administrative expenses rose due to exchange losses **Financial Summary for 2018** | Metric | 2018 (RMB) | 2017 (RMB) | YoY Change | | :--- | :--- | :--- | :--- | | **Revenue** | 37,456 million | 35,474 million | +5.6% | | **Gross Profit** | 4,487 million | 3,768 million | +19.1% | | **Gross Profit Margin** | 12.0% | 10.6% | +1.4pp | | **Operating Profit** | 2,763 million | 2,426 million | +13.9% | | **Profit for the Year** | 1,255 million | 1,211 million | +3.6% | | **Administrative Expenses** | 1,650 million | 733 million | +125.1% | | **Net Cash from Operating Activities** | 776 million | (866) million | N/A | | **Net Gearing Ratio** | 130.7% | 102.2% | +28.5pp | - The gross profit margin for new car sales **increased from 4.9% to 6.1%**, with the margin for luxury and ultra-luxury brands rising from 5.2% to 6.7%[66](index=66&type=chunk) - Average inventory turnover days **increased from 41.1 days to 44.0 days**[75](index=75&type=chunk) [Future Outlook and Strategy](index=24&type=section&id=%E6%9C%AA%E4%BE%86%E5%B1%95%E6%9C%9B%E5%8F%8A%E7%AD%96%E7%95%A5) The Group will leverage its brand portfolio, network, and FinTech platform to address the market shift from volume to value-based competition - The strategy will address the market's shift from incremental growth to a stock market, where consumers demand higher quality products and services[83](index=83&type=chunk) - The strategy will leverage three core advantages: a diversified luxury brand portfolio, a nationwide network, and a leading auto FinTech platform[83](index=83&type=chunk) - The Group will vigorously develop its used car business and explore new marketing models to prepare for competition in the stock market[83](index=83&type=chunk) [Corporate Governance Report](index=25&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%A0%B1%E5%91%8A) [Corporate Governance Report](index=25&type=section&id=%E4%BC%81%E6%A5%AD%E7%AE%A1%E6%B2%BB%E5%A0%B1%E5%91%8A) The company complied with the Corporate Governance Code during 2018, maintaining a clear governance structure with defined board and committee roles - The company adopted and complied with the applicable code provisions of the Corporate Governance Code of the Hong Kong Stock Exchange throughout 2018[88](index=88&type=chunk) - The Board of Directors consists of nine members, including **six executive directors and three independent non-executive directors**, meeting listing rule requirements[92](index=92&type=chunk)[94](index=94&type=chunk) - The roles of Chairman (Mr. Wang Muqing) and Chief Executive Officer (Mr. Koh Chee Choon) are separate, ensuring a balance of power[108](index=108&type=chunk) - The Board has established a Remuneration Committee, a Nomination Committee, and an Audit Committee, each with clear written terms of reference[113](index=113&type=chunk) - The Board reviewed the company's risk management and internal control systems for the year ended December 31, 2018, and confirmed their soundness and effectiveness[128](index=128&type=chunk) [Environmental, Social and Governance (ESG) Report](index=35&type=section&id=%E7%92%B0%E5%A2%83%E3%80%81%E7%A4%BE%E6%9C%83%E5%8F%8A%E7%AE%A1%E6%B2%BB(ESG)%E5%A0%B1%E5%91%8A) [Environmental, Social and Governance (ESG) Report](index=35&type=section&id=%E7%92%B0%E5%A2%83%E3%80%81%E7%A4%BE%E6%9C%83%E5%8F%8A%E7%AE%A1%E6%B2%BB(ESG)%E5%A0%B1%E5%91%8A) The Group's 2018 ESG report details its commitment to environmental protection, employee welfare, product responsibility, and community investment - **Environmental Protection**: The Group insists on using water-based paint in spray booths and ensures waste is handled by licensed suppliers[151](index=151&type=chunk) - **Employment and Labor**: The company had **12,353 employees** at year-end 2018 and emphasized training, organizing 214 new employee training sessions[157](index=157&type=chunk)[167](index=167&type=chunk)[168](index=168&type=chunk) - **Health and Safety**: A total of **98 fire drills** were conducted during the year, and no major safety accidents occurred[166](index=166&type=chunk) - **Product Responsibility**: The Group actively promoted new energy vehicles and assisted automakers with the recall of **11,637 vehicles** during the year[176](index=176&type=chunk)[181](index=181&type=chunk)[183](index=183&type=chunk) - **Community Investment**: The Group actively participates in public welfare activities organized by car brands and encourages local community engagement[187](index=187&type=chunk)[188](index=188&type=chunk) [Directors and Senior Management Profile](index=50&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E9%AB%98%E7%B4%9A%E7%AE%A1%E7%90%86%E4%BA%BA%E5%93%A1%E7%B0%A1%E4%BB%8B) [Directors and Senior Management Profile](index=50&type=section&id=%E8%91%A3%E4%BA%8B%E5%8F%8A%E9%AB%98%E7%B4%9A%E7%AE%A1%E7%90%86%E4%BA%BA%E5%93%A1%E7%B0%A1%E4%BB%8B) The core management team is led by experienced industry veterans, including the Group's founder, a former CEO, and a former BMW (China) executive - **Mr. Wang Muqing**, age 68, is the founder of the Group and has served as Chairman of the Board since 2013[249](index=249&type=chunk) - **Mr. Wang Kunpeng**, age 47, is the Vice Chairman of the Board and former CEO, with extensive experience in auto sales, after-sales, and logistics[250](index=250&type=chunk) - **Mr. Koh Chee Choon**, age 60, is the CEO and previously served as Vice President of Sales and President of BMW (China)[251](index=251&type=chunk) - **Mr. Li Zhuobo**, age 49, is the CFO, with nearly 24 years of financial management experience in the auto distribution industry[251](index=251&type=chunk) [Report of the Directors](index=53&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E5%A0%B1%E5%91%8A) [Report of the Directors](index=53&type=section&id=%E8%91%A3%E4%BA%8B%E6%9C%83%E5%A0%B1%E5%91%8A) This report covers statutory disclosures for 2018, including business performance, dividend proposals, connected transactions, and share placements - The Board recommends a **final dividend of HK$0.14 per share** for the year ended December 31, 2018[266](index=266&type=chunk) - In 2018, the Group's largest supplier and top five suppliers accounted for **18.48% and 63.48%** of total purchases, respectively[272](index=272&type=chunk) - The Group engaged in non-exempt continuing connected transactions, including leasing agreements, with entities controlled by the family of the controlling shareholder, Mr. Wang Muqing[284](index=284&type=chunk)[285](index=285&type=chunk) - The company repurchased shares in April and November 2018 and completed two new share placements, raising net proceeds of approximately **HK$377 million and HK$1.727 billion**[344](index=344&type=chunk)[346](index=346&type=chunk)[347](index=347&type=chunk) - The report identifies macroeconomic conditions, industry policies, intense competition, and supply chain issues as the Group's principal risks and uncertainties[328](index=328&type=chunk) [Independent Auditor's Report](index=70&type=section&id=%E7%8D%A8%E7%AB%8B%E6%A0%B8%E6%95%B8%E5%B8%AB%E5%A0%B1%E5%91%8A) [Independent Auditor's Report](index=70&type=section&id=%E7%8D%A8%E7%AB%8B%E6%A0%B8%E6%95%B8%E5%B8%AB%E5%A0%B1%E5%91%8A) KPMG issued an unmodified audit opinion on the 2018 financial statements, highlighting three key audit matters requiring significant management judgment - The auditor, KPMG, issued an **unmodified opinion** on the consolidated financial statements[353](index=353&type=chunk) - **Key Audit Matter 1**: Impairment of goodwill and intangible assets (vehicle distribution rights), due to their material value and the complex judgments involved[358](index=358&type=chunk) - **Key Audit Matter 2**: Recognition of vendor rebates, due to the complexity of numerous rebate agreements and the risk of premature recognition[360](index=360&type=chunk) - **Key Audit Matter 3**: Loss allowance for receivables from financial services operations, due to the inherent uncertainty and significant management judgment in the expected credit loss model[363](index=363&type=chunk) [Consolidated Financial Statements](index=78&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8) [Consolidated Statement of Profit or Loss](index=78&type=section&id=%E7%B6%9C%E5%90%88%E6%90%8D%E7%9B%8A%E8%A1%A8) For the year ended December 31, 2018, the Group's revenue and gross profit increased, resulting in a profit for the year of RMB 1.255 billion **Consolidated Statement of Profit or Loss Summary for 2018** | Item (RMB in thousands) | 2018 | 2017 | | :--- | :--- | :--- | | **Revenue** | 37,455,510 | 35,474,325 | | **Gross Profit** | 4,486,827 | 3,768,346 | | **Operating Profit** | 2,762,965 | 2,425,754 | | **Profit Before Tax** | 1,889,488 | 1,753,791 | | **Profit for the Year** | 1,254,782 | 1,211,462 | | **Profit Attributable to Equity Shareholders of the Company** | 1,224,065 | 1,190,795 | [Consolidated Statement of Financial Position](index=80&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E7%8B%80%E6%B3%81%E8%A1%A8) As of December 31, 2018, the Group's total assets and liabilities grew in tandem, reflecting the continued expansion of its business operations **Consolidated Statement of Financial Position Summary at Year-End 2018** | Item (RMB in thousands) | Dec 31, 2018 | Dec 31, 2017 | | :--- | :--- | :--- | | **Total Assets** | 44,199,218 | 36,939,130 | |    Non-current Assets | 19,259,362 | 14,383,828 | |    Current Assets | 24,939,856 | 22,555,302 | | **Total Liabilities** | 31,873,772 | 26,585,498 | |    Non-current Liabilities | 8,071,955 | 5,646,559 | |    Current Liabilities | 23,801,817 | 20,938,939 | | **Total Equity** | 12,325,446 | 10,353,632 | [Consolidated Statement of Cash Flows](index=82&type=section&id=%E7%B6%9C%E5%90%88%E7%8F%BE%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) In 2018, the Group's net cash from operating activities improved significantly, turning from a net outflow to a net inflow of RMB 776 million **Consolidated Statement of Cash Flows Summary for 2018** | Item (RMB in thousands) | 2018 | 2017 | | :--- | :--- | :--- | | **Net cash from/(used in) operating activities** | 776,342 | (866,418) | | **Net cash used in investing activities** | (2,999,635) | (1,854,451) | | **Net cash from financing activities** | 2,405,062 | 3,817,595 | | **Net increase in cash and cash equivalents** | 181,769 | 1,096,726 | | **Cash and cash equivalents at end of year** | 2,911,395 | 2,716,220 | [Notes to the Consolidated Financial Statements](index=83&type=section&id=%E7%B6%9C%E5%90%88%E8%B2%A1%E5%8B%99%E5%A0%B1%E8%A1%A8%E9%99%84%E8%A8%BB) The notes provide detailed explanations of accounting policies and breakdowns of financial statement items, including the impact of adopting new IFRS standards