FLY AHEAD China Aircraft Leasing Group Holdings Limited (Incorporated under the laws of the Cayman Islands with limited liability) Annual Report 2014 Stock code : 01848 OUR MISSION To be a full-value chain aircraft solutions provider, utilising our expertise to create innovative, value- added fleet management solutions for airlines worldwide. OUR VISION To become a top-tier aircraft service provider with a global presence, originating from China and reaching out to the world. OUR SHORT-TERM GOAL To build a portfolio of 100 commercial aircraft by 2016 and initiate an aircraft disassembly business by 2017. A320ceo series: Airbus launched its single-aisle product line with the A320, which continues to set industry standards for comfort and operating economy on short to medium haul routes.  Typically seating 150 passengers in a two class cabin or up to 180 in a high density layout for low cost and charter flights, the A320 is in widespread service around the globe on services that vary from short commuter sectors in Europe, Asia and elsewhere to trans-continental flights across the United States.* A320neo series: As the world’s best-selling product line, the NEO Family continues Airbus’ reputation for non-stop innovation – incorporating two new engine choices, Sharklets fuel- saving wingtip devices and a further optimised cabin to deliver unbeatable efficiency and comfort. These improvements result in a per seat fuel burn saving of 20 per cent compared with current engine option (CEO) jetliners, along with additional range, reduced engine noise and lower emissions.* B737-800 series: The Boeing 737-800 is the best-selling version of the successful Next-Generation 737 family. Known for its reliability, fuel efficiency and economic performance, the 737-800 is selected by leading carriers throughout the world because it provides operators the flexibility to serve a wide range of markets. The Boeing 737-800 can seat between 162 and 189 * Source: www.airbus.com passengers, which can fly maximum range 3,115 nautical miles. The 737-800 incorporates # Source: www.boeing.com an advanced technology wing design that helps increase fuel capacity and efficiency, both of which increase range. The advanced wing airfoil design provides an economical cruise speed of.789 Mach (530 mph) – compared to.745 Mach for earlier 737 models.# OUR STRENGTH CALC is the largest operating aircraft lessor in China in terms of new aircraft import under lease each year. OUR CREDENTIALS CALC was listed on the main board of the Stock Exchange of Hong Kong Limited on 11 July 2014 (Stock Code: 01848.HK), the first aircraft lessor listed in Asia. CONTENTS 12 Company Profile 14 Financial Highlights and Four Year Financial Summary 16 Corporate Milestones 19 Chairman Statement 23 Q&A with the CEO 28 Management Discussion and Analysis 48 Communications with Shareholders and Investors 49 Environment, Social and Governance Report 61 Corporate Governance Report 70 Report of the Directors 81 Profile of the Directors and Senior Management 90 Independent Auditor's Report 92 Consolidated Balance Sheet 93 Balance Sheet of the Company 94 Consolidated Statement of Income 95 Consolidated Statement of Comprehensive Income 96 Consolidated Statement of Changes in Equity 97 Consolidated Statement of Cash Flows 98 Notes to the Consolidated Financial Statements 168 Corporate Information LEADING THE WAY CALC is a forerunner in China’s aircraft leasing industry, with a distinctive and profi table business model. GLOBAL FINANCING NETWORK CALC’s financing network covers a full range of channels including onshore and offshore banks, insurance companies and capital markets. EXPERIENCED MANAGEMENT TEAM CALC has brought together leading industry professionals from around the globe to create a management team with unrivalled expertise, dedication and track record. FULL VALUE- CHAIN AIRCRAFT SOLUTIONS PROVIDER CALC offers complete lease management solutions to its customers, optimising their operating return on assets.