Chu Kong Ptrlm&Ntrl Gs Stl Pipe Hldg : Steel Pipe Announces 2014 Interim Results

【FOR IMMEDIATE RELEASE】

(August 29, 2014 - Hong Kong) Chu Kong Petroleum and Natural Gas Steel Pipe Holdings Limited (the "Company", together with its subsidiaries hereinafter referred to as the "Group" or "Chu Kong Steel Pipe", stock code: 1938), the largest manufacturer and exporter of large longitudinal welded steel pipes in China, is pleased to announce the unaudited interim results of the Group for the six months ended 30 June 2014.
For the six months ended 30 June 2014, the Group recorded a turnover of approximately RMB1,484.0 million, representing an increase of 23.7% as compared with that for the corresponding period in 2013 (1H2013: RMB1,200.1 million). Gross profit amounted to approximately RMB245.0 million (1H2013: RMB222.9 million), increased approximately
9.9% as compared with that for the same period in 2013. Profit attributable to owners of
the Company was approximately RMB 70.6 million (1H2013: RMB71.0 million). The earnings per share was approximately RMB0.07 (1H2013: RMB0.07). The Board did not recommend the payment of an interim dividend for the six month ended 30 June 2014.
Under the reviewing period, the Group received new orders of approximately 263,000 tonnes and approximately 54.8% were received from oversea customers. It has delivered approximately 236,000 tonnes of welded steel pipes during the period under review. The overall gross profit margin was approximately 16.5%.
As of today, the Group has accumulated orders to supply welded steel pipe over 500,000 tonnes, representing a significant increase as compared to the corresponding period of last year.
During the period under review, our overseas sales were approximately RMB726 million, accounted for approximately 48.9%, including Thailand's gas project, South America's gas project and the Hong Kong-Zhuhai-Macau Bridge project.

Mr. Chen Chang, Chairman of the Group, comments, "the management and all staff of the Group have put in tremendous effort to steer the Company onto the right track in the first half of 2014, after previous disappointing year. Some of the pipeline projects in China which were delayed last year have now resumed with promising progress lately. The sentiment of the industry displayed a turnaround and the industry has been encouraged by a series of good news, such as the construction of the Sino-Russian pipeline under the China and Russia natural gas agreement, the construction of the high-voltage-power towers in the region of Huainan, the approval and commencement of the construction of the middle section of the West-East-Pipeline Phase III, and the approval of the construction of the Xinjiang- Guangdong-Zhejiang coal-to-gas pipeline.
Looking ahead, the construction of our new overseas LSAW production line in Saudi Arabian will be completed by the end of this year; with an approximated annual production capacity
0f 300,000 tonnes. A joint venture was formed between the Company and Abdel Abdullah Al Qhtani & Sons, Co ("AHQ"), a Saudi Arabian company and one of the largest pipe coating companies in the world. The introduction of the production of LSAW-JCOE to the Middle East region will increase the Group's regional presence, further strengthening the popularity and reputation of the "PCK brand".
The demand of steel pipes will grow progressively throughout the next few years alongside with the growing demand of gas and other renewable energy resources worldwide. The Group has laid a solid foundation, formulated definite development strategies and improved its competitive strengths for its sustainable growth. The Group will adhere to its product diversification and "Integration of Steel Plates and Pipes" strategies and aspire to be a leading world class LSAW steel pipe manufacturer.

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Chu Kong Petroleum and Natural Gas Steel Pipe Holdings Limited is the largest manufacturer and

exporter of longitudinal welded steel pipes in China. Our steel pipes are mainly used for energy

transmission that includes oil and gas transmission pipelines, deep sea pipelines, city gas networks,

petrochemicals, mining and infrastructure.

The Group's production bases are located in Panyu, Zhuhai, Jiangyin, Lianyungang and Saudi Arabia (under construction). The Group has 6 LSAW, 2 SSAW and 1 ERW production lines with a combined annual production capacity up to 2,710,000 tonnes.

Chu Kong Steel Pipe is the industry pioneer, strong in research and development with over 50 registered utility patents including 5 registered invention patents, and has a long standing international and nationwide track record. The Group is the first and only steel pipe manufacturer in China to manufacture deep sea welded steel pipes for using under 1,500m water depth. Chu Kong Steel Pipe is the only welded pipe manufacturer in China that has achieved four national honors and awards, including "Gold Cup Prize for Actual Qualify of Metallurgical Products", "National-recognized Enterprise Technology Centre", "High Technology Enterprise" and "Academician Workstation", we are also the main drafter of the national standard for welded steel pipes.

Shelldy Cheung

Phone: (852) 2626 1833

Email: shelldycheung@zhujiang.co m .hk

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