Guangshen Railway Announces 2008 Interim Results

Volumes of Passenger and Freight Transportation Increase, But Net Profit
Decreases Due to Increase in Finance Costs

HONG KONG, Aug. 27 /Xinhua-PRNewswire-FirstCall/ -- Guangshen Railway
Company Limited ("Guangshen Railway" or the "Company") (HKEx Share Code: 525;
SSE Share Code: 601333; American Depositary Shares ("ADS") Ticket Symbol: GSH)
today announced the unaudited interim results of the Company and its
subsidiaries (the "Group") for the six months ended June 30, 2008 (the
"Period").
During the Period, operating revenues of the Group amounted to RMB5,620
million, representing an increase of 18.83% over the corresponding period of
2007. Profit from operations increased by 7.91% year-on-year to RMB924
million.
Profit attributable to equity holders amounted to RMB674 million (2007
interim:
RMB746 million). The board of directors of the Company does not recommend the
payment of any interim dividend for 2008.
Mr. He Yuhua, Chairman of the Company said, "In the first half of 2008,
the Company minimized the negative impact caused by the heavy rains and
snowstorm at the beginning of the year upon the operation of railway
transportation through implementing measures to increase traffic and revenues,
consolidating and optimizing transportation resources and improving
transportation efficiency. The Company achieved safety and stability in its
operation of transportation as well as a stable growth in transportation
revenues. Profit attributable to equity holders decreased year-on-year due to
an increase in both finance costs and income tax expenses over the
corresponding period last year."
During the Period, passenger delivery volume of the Company was 40.87
million, a year-on-year increase of 16.73%. Revenue from passenger
transportation rose 21.98% year-on-year to RMB3,262 million. Of such amount,
the passenger delivery volumes of Guangzhou-Shenzhen trains, Hong Kong Through
Trains and long-distance trains amounted to 15.57 million, 1.56 million and
23.74 million respectively, representing year-on-year increases of 53.66%,
3.79% and 1.56% respectively and realising revenues of RMB962 million, RMB192
million and RMB2,107 million respectively.
Passenger delivery volume and revenue of Guangzhou-Shenzhen trains
increased mainly due a significant increase in the frequency and capacity of
Guangzhou-Shenzhen trains resulted from two adjustments to the train
schedules.
In addition, after one year of operation of the CRHs, the Guangzhou-Shenzhen
trains have further established its advantages. The fact that the Qingming
Festival, the May Day and the Dragon Boat Festival have become statutory
holidays also led to an increase in short-distance passenger traffic on the
Guangzhou-Shenzhen trains. Meanwhile, with the optimization and consolidation
of the transportation resources of Shenzhen-Guangzhou-Pingshi Railway, the
connection between Guangzhou-Shenzhen trains and long-distance trains has been
running more smoothly and efficiently.
In respect of long-distance trains, despite the heavy rains and snowstorm
at the beginning of the year, which led to a substantial decrease in delivery
volume of long-distance passengers during the Spring Festival Holidays,
passenger delivery volume and revenue increased slightly during the Period.
The growth was mainly attributable to a year-on-year increase in
transportation capacity resulted from the successful commencement of operation
of trains from Guangzhou to Shanghai, from Guangzhou to Xi'an and from
Shenzhen to Shaoguan. Furthermore, the Qingming Festival Holidays, the May Day
Holidays and the Dragon Boat Festival Holidays led to a substantial increase
in the number of passengers traveling between cities within the Pan Pearl
River Delta.
During the Period, tonnage of freight transported by the Company increased
by 8.86% year-on-year to 34.55 million tonnes; and revenues from freight
transportation increased by 14.15% year-on-year to RMB636 million. The
increase in freight revenues of the Company was mainly attributable to certain
increases in per tonne-kilometer tariffs. Additionally, the completion of the
Fourth Rail Line between Guangzhou and Shenzhen led to an obvious increase in
inbound freight for the Guangzhou-Shenzhen Railway, which together the
increase in delivery of high-tariff goods contributed to the increase in
freight revenues.
During the Period, despite the increase in volumes and revenues of
passenger and freight transportation and the fact that the Company has
dedicated to implementing measures to control costs and expenses, profit
attributable to equity holders decreased year-on-year due to a decline in
revenues in the first quarter as a result of the heavy rains and snowstorm at
the beginning of this year and the continuous increase in the prices of
railway-related production materials.
Looking forward to the Company's development in the second half of 2008,
Mr. He said, "The Company's stable development of the entire transportation
business will face a mixed condition with opportunities and challenges. The
optimization of industry structure driven by the economic momentum of the
Pearl River Delta region and further implementation of the Mainland and Hong
Kong Closer Economic Partnership Arrangement (the "CEPA") will bring about
more opportunities for the operation and development of the Company. However,
the Company will continue to face pressure resulting from the increase in
prices of production materials. The Company will strictly control various
costs and expenses and take effective measures to boost transportation traffic
and revenues to mitigate the effects of the heavy rains and snowstorm at the
beginning of the year and price hikes of production materials. As to the
passenger transportation business, the Company will utilize the transportation
capacity of the Fourth Rail Line between Guangzhou and Shenzhen and the "CRH"
train sets, optimize the "As-frequent-as-buses" operation model of our
Guangzhou-Shenzhen trains, and vigorously expand the long-distance passenger
transportation business. Furthermore, the Company will attract more passengers
during summer vacation, the Mid-autumn Holidays and the National Day Holidays
to further increase the occupation rate of passenger trains, with a view to
fully accelerating the business growth of the Company."
Guangshen Railway Company Limited was established in 1996. The H shares
and ADS issued by the Company were listed on The Stock Exchange of Hong Kong
Limited and the New York Stock Exchange respectively in May 1996. The Company
is currently the only PRC railway enterprise with its shares listed overseas.
In December 2006, the Company returned to the A share market and successfully
listed its shares on the Shanghai Stock Exchange. The Company holds the sole
operating rights of the Guangshen Railway, one of the most modern railways in
the PRC. The Company is mainly engaged in railway passenger and freight
transportation businesses between Guangzhou and Shenzhen, long-distance
passenger transportation services, as well as the Hong Kong Through Train
passenger service in cooperation with Kowloon-Canton Railway Corporation
("KCRC") of Hong Kong. As at June 30, 2008, the Company operated 216 pairs of
passenger trains in accordance with its daily train schedule, including 100
pairs of high-speed trains between Guangzhou and Shenzhen, 103 pairs of long-
distance trains, and 13 pairs of Guangzhou-Hong Kong through-trains.
Please refer to the hyperlink below for the Extract of Consolidated Income
Statement of the Company
http://xprnnews.xfn.info/gs/20080827/2008_Interim_E_R2_Table.pdf .
For further information, please contact:

Mr. Guo Xiangdong or Ms. Grace Deng
Guangshen Railway Company Limited
Tel: +86-755-2558-7920 or +86-755-2558-8146
Fax: +86-755-2559-1480

Ms. Edith Lui or Ms. Leona Zeng
Rikes Hill & Knowlton Limited
Tel: +852-2520-2201
Fax: +852-2520-2241

SOURCE Guangshen Railway Company Limited

Mr. Guo Xiangdong or Ms. Grace Deng of Guangshen Railway Company Limited,
+86-755-2558-7920 or +86-755-2558-8146, or fax, +86-755-2559- 1480; Ms. Edith
Lui or Ms. Leona Zeng of Rikes Hill & Knowlton Limited for Guangshen Railway
Company Limited, +852-2520-2201, or fax, +852-2520-2241