Chairman's Statement

Dear Shareholders,

On behalf of the board of directors (the “Board”), I am pleased to present you the operating results of the Company for the year ended 31 December 2020.

As of 31 December 2020, according to the Hong Kong Financial Reporting Standards (“HKFRS”), during the Reporting Period, the Company recorded an operating revenue of RMB17,995,842,000, representing
a year-on-year decrease of 10.57%. Profit before tax amounted to RMB1,512,580,000, representing a year-on-year decrease of 67.69%. Profit attributable to Ordinary Shareholders amounted to RMB21,658,000, representing a year-on-year decrease of 98.79%. In particular, the after-tax core operating results of the principal businesses of the Company (excluding losses arising from the changes in fair value) were
RMB242,497,000, representing a year-on-year decrease of 85.52%. Losses (after tax) arising from the changes in fair value of investment properties were RMB220,839,000 in the period. Earnings per share were RMB0.0064.

Looking back on 2020, despite significant impacts of the COVID-19 pandemic on the operation of the global economy, China maintained its strategic focus and rose to the challenge, coordinated pandemic prevention and control and social and economic development, and became the only major economy in the world that achieved positive economic growth. In the face of the complicated and severe situation in mainland China and abroad and the impact brought by the pandemic, the Company overcame difficulties at all levels and forged ahead with determination by proactively fulfilling its responsibilities as a state-owned enterprise and comprehensively promoted pandemic prevention and control as well as work and production resumption.

In terms of the development properties business, the Company deeply implemented lean management, and improved business deployment and scientific decision-making capabilities; in terms of the investment properties business, while insisting on the development strategy of synergistic progress in asset-heavy investment business and asset-light service business, the Company timely changed its business concept, adapted to the new consumption model derived from the pandemic, continuously optimized the layout of the convention and exhibition industrial chain, and served high-end state affairs with a high sense of responsibility and mission, thereby enhancing the brand influence of the convention and exhibition of North Star on an ongoing basis.

Looking forward to 2021, in spite of a number of uncertainties in the changes of the pandemic and the external environment, China keeps unchanged economic fundamentals of seeking long-term progress and high-quality development while maintaining stability. The Chinese government will adhere to the general principle of seeking progress while maintaining stability, build on the new development stage, implement new development philosophy, construct a new development pattern, and consolidate and extend achievements in pandemic prevention and control and economic and social development, strive to maintain economic operation within a reasonable range. Under the circumstance of opportunities and challenges coexisting, the Company will orient itself towards “operation with light asset, support by new economy, expansion at low cost and development of high-end service industry”, and focus on high quality development of principal business of the Company. For the development properties, the Company will constantly enhance its confidence in development, maintain a scientific pace in expansion and land acquisition, strengthen operational management and control, and benchmark itself against advanced enterprises in the industry, thereby continuously improving its product competitiveness and brand influence; for the investment properties, the Company shall be pragmatic and responsible, move forward under the circumstance, and, while taking the building of convention and exhibition platform in Beijing as the starting point and the foothold, fully integrate into the capital construction and new development pattern, deeply study both the changed and the unchanged under the pandemic, and steadily promote coordinated development of various kinds of business including conventions and exhibitions, office buildings, hotels and apartments, thus further enhancing the core competitiveness of the Company.

I firmly believe that, all the staff members of North Star will, with strong sense of professionalism and high sense of responsibility, strive for building an international first-class convention and exhibition brand enterprise and a leading composite real estate brand enterprise in the PRC, without disappointing investors who bestow trust on us.

Finally, on behalf of the Board, I would like to express our most sincere gratitude to all shareholders who have been supporting the development of the Company, and also to all the members of the Board, the supervisory committee and the management of the Company for their due diligence, and I would like to extend our heartfelt thanks to all the staff members of the Company for all the hard work they have done.

By Order of the Board

Li Wei-Dong