港股贵金属板块走高，赤峰黄金(06693.HK)涨超8%，山东黄金(01787.HK)涨超7%，灵宝黄金 (03330.HK)、紫金矿业(02899.HK)跟涨。 ...

Core Viewpoint - Lingbao Gold (03330) has shown a significant increase in stock price, rising over 3% to HKD 6.58, with a trading volume of HKD 42.1 million. The company is expected to achieve substantial revenue and profit growth in 2024, driven by improved performance in overseas mining and smelting operations [1][2]. Group 1: Financial Performance - In 2024, Lingbao Gold is projected to achieve operating revenue of CNY 11.87 billion, representing a year-on-year increase of 12.7% [1]. - The company is expected to realize a net profit attributable to shareholders of CNY 700 million, reflecting a year-on-year growth of 119.4% [1]. - For the second half of 2024, the operating revenue is anticipated to reach CNY 7.59 billion, with year-on-year and quarter-on-quarter increases of 61.5% and 77.3%, respectively [1]. - The net profit for the second half of 2024 is forecasted to be CNY 550 million, showing year-on-year and quarter-on-quarter growth of 175.0% and 260.3%, respectively [1]. - The profit figures are close to the upper limit of the company's previous forecasts, indicating a strong performance in overseas mining and smelting operations [1]. Group 2: Exploration and Production Plans - The company plans to drill 150,000 meters and conduct 270,000 meters of pit exploration by 2025, aiming to submit nearly 100 tons of gold metal reserves for filing by the end of 2026 [2]. - Lingbao Gold aims to maintain an annual growth rate of over 10% in mineral metal output from existing mines over the next five years [2]. - The target for gold production cost per gram is set at approximately CNY 300 (around USD 1,100 per ounce) for 2025, with a long-term goal to keep costs below USD 1,000 per ounce [2].

Investment Rating - The report maintains a "Strong Buy" investment rating for Lingbao Gold [3][6]. Core Insights - Lingbao Gold achieved a revenue of 11.87 billion yuan in 2024, representing a year-on-year increase of 12.7%, and a net profit attributable to shareholders of 700 million yuan, up 119.4% year-on-year [1][2]. - The company reported significant growth in the second half of 2024, with revenues of 7.59 billion yuan, reflecting a year-on-year increase of 61.5% and a quarter-on-quarter increase of 77.3% [1]. - The report highlights that the company's gold production capacity utilization improved significantly in the second half of 2024, leading to a substantial increase in output [6]. - The report projects a continued upward trend in profitability, with net profits expected to reach 1.12 billion yuan in 2025, corresponding to a PE ratio of 6.8 [6][8]. Financial Data and Valuation - Total revenue is projected to grow from 10.54 billion yuan in 2023 to 14.98 billion yuan in 2025, with a compound annual growth rate (CAGR) of 26% [2][8]. - The net profit is expected to increase from 318 million yuan in 2023 to 1.12 billion yuan in 2025, with a CAGR of 60% [2][8]. - The report indicates a decrease in the cost of gold production, with the total cost per gram expected to be around 300 yuan in 2025 [6]. Key Financial Ratios - The report notes an improvement in the return on equity (ROE), projected to rise from 11.9% in 2023 to 25.4% in 2025 [8]. - The asset-liability ratio is expected to decrease from 64.4% in 2023 to 49.8% in 2025, indicating improved financial stability [8]. - The gross profit margin is projected to increase from 9.2% in 2023 to 14.9% in 2025, reflecting enhanced operational efficiency [8].

Financial Performance - For the fiscal year ending December 31, 2024, the company reported total revenue of RMB 11,866,628, an increase of 12.7% from RMB 10,533,681 in 2023[3] - Gross profit for the same period was RMB 1,461,919, representing a gross margin of approximately 12.3%, up from RMB 969,901 in 2023[3] - The operating profit increased significantly to RMB 1,047,296, compared to RMB 581,649 in the previous year, marking an increase of 80.4%[3] - Net profit for the year was RMB 699,132, a substantial rise of 137.5% from RMB 294,027 in 2023[3] - Basic and diluted earnings per share rose to RMB 56.75, compared to RMB 32.35 in the previous year, reflecting a growth of 75.6%[3] - Total comprehensive income for the year was RMB 691,012, compared to RMB 282,561 in 2023, indicating a growth of 144.5%[4] Assets and Liabilities - Non-current assets increased to RMB 4,206,351 from RMB 3,871,596, showing a growth of 8.6%[5] - Current liabilities decreased to RMB 3,025,313 from RMB 3,706,322, a reduction of 18.4%[6] - The company's total equity increased to RMB 3,158,184, up from RMB 2,436,554, representing a growth of 29.6%[6] - Total accounts receivable and other receivables amounted to RMB 476,258,000 in 2024, up from RMB 413,884,000 in 2023, indicating a growth of approximately 15%[27] - The company reported a decrease in accounts receivable, net of loss provisions, from RMB 235,752,000 in 2023 to RMB 190,841,000 in 2024, a decline of about 19%[27] - The total bank and other borrowings decreased from RMB 2,853,108,000 in 2023 to RMB 2,644,510,000 in 2024, a reduction of approximately 7.3%[34] - Short-term bank and other borrowings decreased from RMB 2,725,108,000 in 2023 to RMB 2,081,810,000 in 2024, a decline of about 23.6%[34] - The company’s procurement deposits decreased from RMB 797,964,000 in 2023 to RMB 749,043,000 in 2024, a decline of about 6.1%[32] - The company’s long-term bank borrowings increased from RMB 128,000,000 in 2023 to RMB 562,700,000 in 2024, representing a growth of approximately 339%[34] Revenue Breakdown - The group's revenue from gold sales in 2024 reached RMB 11,894,876,000, an increase of 16.8% compared to RMB 10,185,652,000 in 2023[17] - Revenue from other metals sales decreased to RMB 183,596,000 in 2024 from RMB 315,379,000 in 2023, representing a decline of 41.8%[17] - The total revenue for 2024, after deducting sales tax and levies, was RMB 11,866,628,000, up from RMB 10,533,681,000 in 2023, marking an increase of 12.6%[17] - The total revenue from the mining segment for fiscal year 2024 was approximately RMB 2,571,687 thousand, an increase of approximately RMB 186,268 thousand or 7.81% from RMB 2,385,419 thousand in the previous year[49] - The company's mining revenue from domestic operations was approximately RMB 2,314,365 thousand in 2024, compared to RMB 2,245,632 thousand in 2023[49] - The smelting segment achieved total revenue of approximately RMB 12,043,436 thousand in fiscal year 2024, an increase of about 13.42% from RMB 10,618,737 thousand in the previous year[54] Profitability - The company's profit for the year 2024 reached RMB 697,997,000, a significant increase from RMB 318,082,000 in 2023, representing a growth of approximately 119%[25] - The mining segment's profit for fiscal year 2024 was approximately RMB 1,107,383 thousand, an increase of about 55.96% compared to fiscal year 2023[51] - Profit from domestic mining in China increased by approximately 35.75% year-on-year, with a profit of about RMB 1,096,868 thousand in fiscal year 2024[52] - The smelting segment turned a profit of approximately RMB 48,269 thousand in fiscal year 2024, compared to a loss of about RMB 9,500 thousand in fiscal year 2023[55] Dividends and Shareholder Information - The proposed final dividend for the year is RMB 0.08 per share, totaling approximately RMB 102,958,000, an increase from RMB 79,076,000 in 2023[22] - Basic earnings per share for 2024 were calculated based on a weighted average of 1,229,935,839 shares, compared to 983,397,075 shares in 2023[24] - The board proposed a final dividend of RMB 0.08 per share for the fiscal year ending December 31, 2024, an increase from RMB 0.065 in the previous fiscal year[89] - The final dividend is expected to be distributed around July 31, 2025, pending shareholder approval at the upcoming annual general meeting[91] - The company will temporarily suspend the registration of share transfers from May 22 to May 27, 2025, to determine eligibility for attending the annual general meeting[91] - The company will also suspend share transfer registration from June 6 to June 11, 2025, to determine eligibility for receiving the final dividend[92] Future Outlook and Strategy - The company is focused on expanding its operations in China, particularly in gold mining and refining, to enhance its market position[8] - The company aims to accelerate internationalization and promote digital and green low-carbon transformation in the future[56] - The company has implemented measures to reduce debt ratios and enhance financing capabilities, including optimizing resource allocation and improving cash flow management[65] - The group faced various market risks, including fluctuations in gold prices and other commodity values, which directly impact revenue and profit[69] - The group has no major investment plans as of the publication date[85] Compliance and Governance - The company has complied with the Corporate Governance Code as per the listing rules for the fiscal year ending December 31, 2024[86] - The company's financial statements for the fiscal year ending December 31, 2024, have been compared and agreed upon by the auditor, Lixin Dehao CPA[95] - The company will withhold corporate income tax at a rate of 10% for non-resident corporate shareholders receiving the final dividend[89] - The company’s annual report for 2024 will be provided to shareholders at a later date and will be available on the Hong Kong Stock Exchange website[96] Employee and Share Issuance Information - The group had 3,618 employees at the end of the fiscal year 2024, emphasizing the importance of competitive compensation and training programs[76] - The group completed the issuance of new H-shares under general authorization, raising approximately HKD 42.4 million for the procurement of gold concentrates for gold bar production[78] - The group also completed another issuance of new H-shares, raising approximately HKD 79.3 million for the same purpose, with funds expected to be utilized by July 2025[79] - The group reported no significant contingent liabilities as of December 31, 2024[74] - The group is exposed to interest rate risk, which could increase financing costs if the People's Bank of China raises interest rates[70] - The group has implemented a share incentive plan approved by the board on September 5, 2024[77] - The audit committee reviewed and confirmed the annual performance for the fiscal year 2024, with no objections to the accounting treatment adopted by the company[94]

假设所有配售股份获悉数配售及待完成后，预期配售事项的最高所得款项总额及所得款项净额（经扣除 配售事项佣金以及配售事项的其他相关成本及开支后）将分别约为2.34亿港元及2.29亿港元。配售事项 所得款项净额拟用于可能的并购机会。公司将向联交所申请批准配售股份于联交所上市及买卖。 灵宝黄金公告，2025年3月10日，公司与配售代理(即国泰君安国际)订立配售协议，据此，配售代理已 有条件同意作为公司配售代理按尽力基准促使不少于六名承配人(彼等及彼等的最终实益拥有人(如适用) 将为独立第三方)认购最多4350万股配售股份，配售价为每股配售股份5.38港元。 假设于本公告日期至完成日期期间已发行股份数目并无变动，则配售事项项下的最多4350万股配售股份 相当于本公告日期现有已发行H股数目的约4.10%及现有已发行股份数目的约3.50%，及经配发及发行配 售股份扩大后的已发行H股数目的约3.93%及已发行股份数目的约3.38%。 校对：吕久彪 ...

Summary of Conference Call Minutes Company Overview - The conference call focused on **Lingjin Gold**, a company primarily engaged in the gold mining industry, which has seen increased market attention since last year due to significant profit releases and stock performance [1][2]. Key Points and Arguments - **Profit Forecast**: The company is expected to achieve a conservative profit of over **1 billion** (10亿) in 2025, corresponding to its current price-to-earnings (PE) ratio [1]. - **Company History**: Established in **2002**, Lingjin Gold has undergone several acquisitions, including mining subsidiaries, and divested non-core businesses to focus on gold mining [2]. - **Management Improvements**: Since the major shareholder took over in **2016**, management salaries have significantly increased from an average of **180,000** (18万) in 2017 to **1,160,000** (116万) in 2023, indicating better management incentives [3]. - **Resource Potential**: As of the end of **2023**, the company has a total resource volume of **137 tons** with an average grade of **5.4 grams per ton**, positioning it favorably in the industry [7]. - **Future Growth**: The company has significant potential for resource expansion, particularly in the **Laowan Gold Mine** in Henan, which has a reported resource volume of over **30 tons** and potential to exceed **500 tons** [8]. - **Production Trends**: Gold production has been steadily increasing, with **5.5 tons** produced in 2023. The company anticipates production could reach **7 to 8 tons** in the second half of 2024 [9][10]. - **Cost Management**: The mining cost remains stable at approximately **350 yuan** per gram, which is competitive within the industry [12]. Additional Important Information - **Market Conditions**: The company has faced historical volatility in earnings, particularly in **2013**, **2015**, and **2018**, but has shown signs of recovery and profitability since late **2022** [4][5][13]. - **Strategic Focus**: Lingjin Gold is preparing for a full conversion of domestic shares to H-shares for listing on the Hong Kong Stock Exchange, enhancing its market accessibility [3]. - **International Expansion**: The company has established an overseas division in **2024** to explore international mining opportunities [9]. This summary encapsulates the essential insights from the conference call regarding Lingjin Gold's operations, financial outlook, and strategic initiatives.

财联社1月16日讯(编辑 胡家荣) 受隔夜国际金价重回2700美元利好，港股黄金股走强。截至发稿，灵宝 黄金(03330.HK)、紫金矿业(02899.HK)、中国黄金国际(02099.HK)分别上涨5.40%、3.73%、2.79%。 消息方面，当地时间周三，美国劳工部公布的数据显示，因能源产品成本上升，美国12月整体CPI涨幅 略高于预期。但核心CPI数据几个月来首次出现放缓，激发了市场的乐观情绪。 在这一数据公布后，市场增加对美联储6月降息的押注，今年降息两次的可能性上升。受此刺激，贵金 属表现强势，现货黄金昨晚站上2700美元/盎司关口。 截至发稿，Comex黄金涨0.28%，报2725.50美元。 紫金矿业回应称列入实体清单不构成重大影响 具体数据显示，美国12月未季调CPI年率为2.9%，符合市场预期，前值为2.7%，为连续第三个月反弹， 至2024年7月以来新高；12月季调后CPI月率为0.4%，高于预期的0.3%，前值为0.3%。 值得注意的是，昨日下跌超5%的紫金矿业也在今日出现反弹。 消息方面，紫金矿业发布公告称，公司及在疆部分权属企业被列入UFLPA实体清单。紫金矿业表示， 公司及在疆部 ...

财联社1月16日电，截至发稿，灵宝黄金(03330.HK)涨4.63%、紫金矿业(02899.HK)涨3.18%、中国黄金 国际(02099.HK)涨2.21%。 消息面上，昨晚，美国整体CPI同比增速温和反弹至2.9%，核心CPI同比增速意外从上月的3.3%回落至 3.2%。 受此刺激，贵金属表现强势，现货黄金站上2700美元/盎司关口。 数据公布后，交易员增加对美联储6月降息的押注，今年降息两次的可能性上升。 ...

消息方面，COMEX黄金期货周二收涨0.81%，报2639.30美元/盎司。值得注意的是，2024年累计涨幅 27.5%，为2010年以来最大的年度涨幅;过去两年，金价上涨了44.5%。 这一年黄金涨势强劲，背后是多种因素共同发力。地缘政治紧张局势的加剧，使得投资者纷纷寻求避险 资产，黄金成为首选之一。货币政策的放松，为黄金价格上涨提供了有利的宏观环境。 此外黄金这一表现也提振国内黄金企业的表现。比如山东黄金前三季度实现归母净利润约20.66亿元， 同比增长53.57%；招金矿业前三季度业绩归母净利润8.81亿元，同比大增141.07%。 展望2025年，分析师普遍持乐观态度。尽管即将上台的特朗普政府的政策可能会带来一些变数，如政策 阻力或许会加剧通胀，并减缓美联储的降息步伐，但整体来看，支撑金价的因素依然强劲。 摩根大通也认为，尽管短期内黄金价格可能会因美国降息预期减弱而出现波动，但长期来看，黄金的结 构性牛市并未改变。 财联社1月2日讯(编辑 胡家荣) 今日港股持续盘整，但是黄金股获得资金关注。截至发稿，灵宝黄金 (03330.HK)、山东黄金(01787.HK)、中国黄金国际(02099.HK)分别上涨 ...

[Company Information](index=2&type=section&id=Company%20Information) [Board of Directors and Supervisory Committee](index=3&type=section&id=Board%20of%20Directors%20and%20Supervisory%20Committee) Lingbao Gold Group Co., Ltd. released its interim report as of June 30, 2024, disclosing the composition of its Board of Directors, Supervisory Committee, and their respective committees - The term of the Seventh Board of Directors and Supervisory Committee expired, and members of the Eighth Board of Directors and Supervisory Committee were officially elected at the Annual General Meeting on **May 29, 2024**[3](index=3&type=chunk) [Company Basic Information](index=4&type=section&id=Company%20Basic%20Information) This section provides fundamental company information including registration details, principal bankers, investor relations contacts, stock code, listing date, and total share capital - The H share registrar of the Company is Hong Kong Registrars Limited[4](index=4&type=chunk) - The Company's stock code is **3330**, and its listing date was **January 12, 2006**[6](index=6&type=chunk) - As of June 30, 2024, the Company's total share capital was **1,243,476,055 shares**, comprising **566,975,091 domestic shares** and **676,500,964 H shares**[31](index=31&type=chunk) [Management Discussion and Analysis](index=4&type=section&id=Management%20Discussion%20and%20Analysis) [Business Review and Outlook](index=4&type=section&id=Business%20Review%20and%20Outlook) In the first half of 2024, Lingbao Gold Group's gold ingot production decreased due to Henan Province's regulatory requirements and adjusted procurement, leading to a **26.67% year-on-year revenue reduction**, yet net profit **increased by 26.73% to RMB152,658 thousand** due to higher gold prices, with all company-operated mines achieving profitability for the first time, and the Group boasts substantial gold reserves and resources of approximately **136.34 tonnes** - Gold ingot production in the first half of 2024 was approximately **7,950 kg (255,580 oz)**, a year-on-year decrease of approximately **5,068 kg (162,935 oz)**, mainly due to Henan Province's mining regulations and adjustments in gold concentrate procurement[6](index=6&type=chunk) - Revenue for the period was approximately **RMB4,281,228 thousand**, a year-on-year decrease of **26.67%**[6](index=6&type=chunk) - Net profit for the period was approximately **RMB152,658 thousand**, a year-on-year increase of **26.73%** (2023: RMB120,467 thousand)[6](index=6&type=chunk) - As of June 30, 2024, the Group held **37 mining and exploration rights**, with total gold reserves and resources of approximately **136.34 tonnes (4,383,013 oz)**[7](index=7&type=chunk) [Mining Segment](index=5&type=section&id=Mining%20Segment) The mining segment's total revenue decreased by **37.56% year-on-year to RMB778,098 thousand** in the first half, primarily due to Henan Province's unified regulatory requirements impacting Nanshan Branch and Xingyuan Company's output, though Fujin, Jinchan, and Huatai companies saw increased output and revenue, and the Kyrgyzstan mining segment achieved profitability, reversing last year's losses - Total revenue for the mining segment was approximately **RMB778,098 thousand**, a year-on-year decrease of **37.56%**[9](index=9&type=chunk) - Total profit for the mining segment was approximately **RMB273,277 thousand**, a year-on-year decrease of **32.38%**[10](index=10&type=chunk) - The Kyrgyzstan mining segment recorded a profit of **RMB5,900 thousand**, compared to a loss of approximately **RMB115,034 thousand** in the same period of 2023, achieving a turnaround to profitability[10](index=10&type=chunk) Mining Segment Production and Sales Volume (Six Months Ended June 30) | Product Name | Unit | Approx. Production Volume 2024 | Approx. Sales Volume 2024 | Approx. Production Volume 2023 | Approx. Sales Volume 2023 | | :--------------- | :--- | :----------------- | :----------------- | :----------------- | :----------------- | | Gold concentrate (contained gold) | kg | 1,456 | 1,378 | 2,556 | 2,642 | | Gold alloy | kg | 348 | 347 | 368 | 350 | | Total | kg | 1,805 | 1,725 | 2,924 | 2,992 | | Total | oz | 58,022 | 55,465 | 94,007 | 96,193 | [Smelting Segment](index=7&type=section&id=Smelting%20Segment) The smelting segment's total revenue decreased by **26.81% year-on-year to RMB4,291,005 thousand** in the first half, mainly due to reduced mining output and the Group's proactive reduction in gold concentrate procurement; despite lower revenue, the segment's loss decreased year-on-year due to rising prices of by-products silver, copper products, and sulfuric acid, coupled with cost reduction and efficiency improvements - Total revenue for the smelting segment was approximately **RMB4,291,005 thousand**, a year-on-year decrease of **26.81%**[12](index=12&type=chunk) - The smelting segment recorded a loss of **RMB24,444 thousand**, a reduction from the loss of approximately **RMB28,707 thousand** in the same period of 2023[13](index=13&type=chunk) Smelting Segment Production and Sales Volume (Six Months Ended June 30) | Product Name | Unit | Approx. Production Volume 2024 | Approx. Sales Volume 2024 | Approx. Production Volume 2023 | Approx. Sales Volume 2023 | | :--------------- | :--- | :----------------- | :----------------- | :----------------- | :----------------- | | Gold ingots (from gold concentrate processing) | kg | 4,802 | 4,795 | 5,278 | 5,000 | | Gold ingots (from purchased gold alloy processing) | kg | 3,148 | 3,119 | 7,740 | 8,009 | | Silver | kg | 4,785 | 4,860 | 11,556 | 10,168 | | Copper products | ton | 775 | 792 | 2,259 | 2,404 | | Sulfuric acid | ton | 53,165 | 51,597 | 52,322 | 55,769 | [Consolidated Operating Results](index=7&type=section&id=Consolidated%20Operating%20Results) The Group's total revenue in the first half decreased by **26.67% year-on-year to RMB4,281,228 thousand**, primarily due to reduced procurement of gold concentrate and lower mining output; however, gross profit **increased by 14.72% to RMB407,686 thousand**, with gross margin rising to **9.52%**, driven by improved gross profit at Fujin Company, Jinchan Company's turnaround to profitability, and reduced losses in the smelting segment - The Group's revenue for the period was approximately **RMB4,281,228 thousand**, a **26.67%** decrease compared to the same period in 2023[13](index=13&type=chunk) - The Group's gross profit and gross profit margin for the period were **RMB407,686 thousand** and **9.52%**, respectively, compared to **RMB355,376 thousand** and **6.09%** in the same period last year[14](index=14&type=chunk) - The increase in gross profit margin was attributable to improved gross profit at Fujin Company, Jinchan Company's turnaround to profitability, and reduced losses in the smelting segment[14](index=14&type=chunk) Product Sales Analysis (Six Months Ended June 30) | Product Name | Amount 2024 (RMB thousand) | Sales Volume 2024 | Average Selling Price 2024 (RMB/kg or ton) | Amount 2023 (RMB thousand) | Sales Volume 2023 | Average Selling Price 2023 (RMB/kg or ton) | | :------- | :---------------------- | :------------- | :--------------------------------- | :---------------------- | :------------- | :--------------------------------- | | Gold ingots | 4,063,064 | 7,914 kg | 513,402 | 5,546,828 | 13,018 kg | 426,089 | | Silver | 29,642 | 4,860 kg | 6,099 | 48,324 | 10,168 kg | 4,753 | | Copper products | 51,456 | 792 ton | 64,970 | 143,051 | 2,404 ton | 59,507 | | Sulfuric acid | 2,419 | 51,597 ton | 47 | 1,787 | 55,769 ton | 32 | | Gold concentrate | 169,476 | 332 kg | 510,470 | 91,883 | 253 kg | 363,174 | | Others | 4,463 | | | 38,352 | | | | **Revenue before tax** | **4,320,520** | | | **5,870,225** | | | | Less: Sales tax and surcharges | (39,292) | | | (31,642) | | | | **Total Revenue** | **4,281,228** | | | **5,838,583** | | | [Outlook and Plans for the Second Half of 2024](index=9&type=section&id=Outlook%20and%20Plans%20for%20the%20Second%20Half%20of%202024) The Group plans to leverage favorable rising gold prices to consolidate its development in the second half, aiming for increased production, efficiency, and sustainable growth by boosting mine investment, advancing digital transformation, strengthening headquarters' technical and management platforms, implementing talent strategies, expanding overseas markets, and continuously enhancing safety and environmental protection - Since the beginning of this year, gold prices have continued to rise, providing favorable conditions for the Group's steady development[15](index=15&type=chunk) - In the second half, the Group will capitalize on favorable market conditions to optimize production organization, strengthen cost control, and accelerate the upgrade of mining equipment and related engineering construction[15](index=15&type=chunk) - The Group will continue to advance its production's **"digital and intelligent" transformation** with the goal of full-process digitalization and intelligence, promoting efficiency and speed in production operations, and achieving management upgrades[16](index=16&type=chunk) - The Group will actively promote an **equity incentive plan** for eligible individuals to reward contributions, retain, and attract key talent[18](index=18&type=chunk) - The Group will resolutely implement its **"going out" strategy**, focusing on achieving effective progress in resource mergers and acquisitions, exploration, and management to ensure the strategic goal of increasing resource reserves[19](index=19&type=chunk) - In the second half, the Group will continue to strengthen safety and environmental risk supervision, organize special inspections and rectifications for safety and environmental protection, and intensify supervision and assessment efforts[20](index=20&type=chunk) [Consolidate Development Momentum, Organize Production and Operations, and Increase Exploration and Reserves](index=9&type=section&id=Consolidate%20Development%20Momentum%2C%20Organize%20Production%20and%20Operations%2C%20and%20Increase%20Exploration%20and%20Reserves) In the first half, the Group invested **RMB95 million** in key mining enterprises for resource exploration, safety, environmental protection, and technological innovation, significantly improving resource development and utilization efficiency; in the second half, it will leverage favorable market conditions to optimize production, strengthen cost control, and plans to invest approximately **RMB200 million** over three years for exploration at Lingjin No. 1 Mine, Nanshan Branch's main production base, to increase reserves and output - In the first half, a cumulative investment of **RMB95 million** was made in mining enterprises for resource exploration, safety and environmental protection, technological innovation, and the promotion of new technologies[15](index=15&type=chunk) - Huatai Company and Nanshan Branch increased their monthly single-face tunneling distance from **50m and 80m to 150m**, respectively; Xingyuan Company's ore dressing recovery rate improved to **92.8%**[15](index=15&type=chunk) - In the second half, the Group will strengthen comprehensive research on the metallogenic potential of existing mining rights, intensify exploration of high-quality mining rights, and plans to invest approximately **RMB200 million** in exploration funds over three years for Lingjin No. 1 Mine, Nanshan Branch's main production base[15](index=15&type=chunk) [Accelerate Digital and Intelligent Transformation of Production, Expedite Green Mine (ESG) Construction](index=10&type=section&id=Accelerate%20Digital%20and%20Intelligent%20Transformation%20of%20Production%2C%20Expedite%20Green%20Mine%20(ESG)%20Construction) The Group steadily advanced intelligent mining, investing **RMB21 million** to upgrade its dispatch command center and six system integrations, enabling unattended operation and remote control; in the first half, transaction and contract management systems were launched, and the mine "MES" system began trial operation at Nanshan Branch and Xingyuan Company, with nearly **RMB7 million** invested in ecological restoration, actively responding to "dual carbon" goals - A cumulative investment of **RMB21 million** was made to upgrade the dispatch command centers and integrate six systems (hoisting, transportation, ventilation, compressed air, drainage, and power supply) at Nanshan Branch, Xingyuan Company, Jinchan Company, and Huatai Company[16](index=16&type=chunk) - In the first half, the transaction management system and contract management system were launched, and the mine "MES" system began trial operation at Nanshan Branch and Xingyuan Company[16](index=16&type=chunk) - In the first half, a cumulative investment of nearly **RMB7 million** was made, restoring **470 mu** of vegetation, **27 mu** of ecological land, and planting **7,530 trees**[17](index=17&type=chunk) [Strengthen Headquarters Platform Construction, Resolve Key Technical and Management Issues](index=11&type=section&id=Strengthen%20Headquarters%20Platform%20Construction%2C%20Resolve%20Key%20Technical%20and%20Management%20Issues) The Group continuously strengthened its technical platform, with experts providing over **50 on-site services** in the first half to resolve technical and management challenges; Huatai Company improved ore grade by **17%** through mining method adjustments, Xingyuan Company established the nation's first intelligent gold ore sorting system, and the Smelting Branch enhanced gold mud quality and silver leaching rates while reducing production costs through technical upgrades, further engaging consulting firms like Deloitte to refine its management system - In the first half, experts in mining, beneficiation, mechanical and electrical engineering, safety and environmental protection, finance, and auditing were deployed to the front lines, providing over **50 on-site services** to help enterprises resolve technical and management challenges[17](index=17&type=chunk) - Huatai Company, by adjusting its mining methods and utilizing cemented backfill mining, increased the ore grade by **17%** compared to the average mining grade in the same period[17](index=17&type=chunk) - Xingyuan Company established the nation's first intelligent gold ore sorting system, increasing the feed grade by **0.2 grams** and the waste rock rejection rate by **13.76%**[17](index=17&type=chunk) - The Smelting Branch implemented several technical modifications, including replacement plate-and-frame gold mud washing and zinc powder precious liquid purification, improving gold mud quality and smelting silver leaching rates, and reducing refining production costs[17](index=17&type=chunk) [Advance Internal Reforms, Implement Talent-Strengthening Strategy](index=12&type=section&id=Advance%20Internal%20Reforms%2C%20Implement%20Talent-Strengthening%20Strategy) Adhering to a "talent-first" philosophy, the Group successfully recruited dozens of senior and high-potential industry talents in the first half, alongside management, finance, investment, and technology professionals from specialized agencies and tech firms; aiming for a younger leadership, the Group appointed over **10 young middle-level cadres** to key positions and plans to implement an equity incentive scheme to attract and retain critical talent, continuously optimizing staffing and refining its compensation system - In the first half, dozens of senior and high-potential talents from benchmark enterprises in the industry and related fields were successfully recruited, while management, finance, and investment professionals were introduced from firms like Deloitte and PwC, and technology talents from companies such as Accenture and Tencent[18](index=18&type=chunk) - With the goal of rejuvenating leadership, over **10 young middle-level cadres** were selected to hold key positions in major mining enterprises[18](index=18&type=chunk) - The Group will actively promote an **equity incentive plan** for eligible individuals to reward contributions, retain, and attract key talent[18](index=18&type=chunk) [Unwavering Implementation of the "Going Out" Strategy](index=12&type=section&id=Unwavering%20Implementation%20of%20the%20%22Going%20Out%22%20Strategy) The Group is steadfastly implementing its "going out" strategy, having established an overseas business unit in the first half to oversee the entire process of international project screening, inspection, due diligence, negotiation, and operational team formation; the unit has conducted **7 on-site due diligence visits and inspections** in regions such as the South Pacific and Southern Africa, with plans to continue explorations in the second half to secure new overseas resource development bases - The Group is resolutely implementing its **"going out" strategy**, focusing on achieving effective progress in resource mergers and acquisitions, exploration, and management[19](index=19&type=chunk) - In the first half, an overseas business unit was established, fully responsible for the entire process of overseas project collection and screening, preliminary inspection, intermediary selection, on-site due diligence, business negotiation, and signing and closing[19](index=19&type=chunk) - The overseas business unit has organized teams to conduct **7 on-site due diligence visits and inspections** for projects in regions such as the South Pacific and Southern Africa[19](index=19&type=chunk) [Continuously Strengthen Safety and Environmental Protection Work](index=13&type=section&id=Continuously%20Strengthen%20Safety%20and%20Environmental%20Protection%20Work) In the first half, the Group strictly adhered to safety and environmental regulations, investing **RMB41.82 million** to enhance safety protection, address hazards, and promote new technologies and equipment, ensuring a stable and controllable safety and environmental situation; the Smelting Branch continuously managed sulfur dioxide and nitrogen oxide emissions, initiating a cyanide-containing wastewater desalination project for in-depth treatment, and increased investment in its solid waste disposal company to ensure efficient and environmentally friendly disposal of smelting tailings - In the first half, a total of **RMB41.82 million** was invested in improving safety protection, addressing hazards, promoting new equipment, assessing and monitoring hazardous sources, obtaining safety licenses, maintaining tailings pond closures, and environmental protection projects[20](index=20&type=chunk) - The Smelting Branch maintained regular control over sulfur dioxide and nitrogen oxide emissions, ensuring minimal exhaust emissions and stable monitoring data, and initiated a cyanide-containing wastewater desalination project for in-depth treatment[20](index=20&type=chunk) - The Group continuously increased investment in the production and construction of Lingbao Xinan Solid Waste Disposal Co., Ltd., to ensure efficient and environmentally friendly disposal of smelting tailings[20](index=20&type=chunk) [Financial Review](index=13&type=section&id=Financial%20Review) As of June 30, 2024, the Group's cash and cash equivalents increased to **RMB331,854 thousand**, and total equity rose to **RMB2,612,111 thousand**; while net current liabilities improved, they remained negative, and the gearing ratio increased to **48.7%**; the Group faces gold price volatility, interest rate, and exchange rate risks, planning to reduce its gearing ratio by enhancing profitability, strengthening equity financing, and diversifying funding channels, with capital expenditure for the period at approximately **RMB288,056 thousand** and a total workforce of **3,646 employees** - As of June 30, 2024, cash and cash equivalents were **RMB331,854 thousand** (December 31, 2023: RMB256,724 thousand)[21](index=21&type=chunk) - As of June 30, 2024, the Company's total equity was **RMB2,612,111 thousand** (December 31, 2023: RMB2,436,554 thousand)[21](index=21&type=chunk) - Current ratio was **87.2%** (December 31, 2023: 80.0%)[21](index=21&type=chunk) - Gearing ratio was **48.7%** (December 31, 2023: 41.7%), calculated as total borrowings divided by total assets[22](index=22&type=chunk) - The Group's capital expenditure for the period was approximately **RMB288,056 thousand**, an increase of approximately **42.9%** compared to approximately RMB201,619 thousand in the same period of 2023[28](index=28&type=chunk) - As of June 30, 2024, the Group had **3,646 employees** (December 31, 2023: 4,103 employees)[28](index=28&type=chunk) [Liquidity and Financial Resources](index=13&type=section&id=Liquidity%20and%20Financial%20Resources) The Group primarily funds its operations through internal capital and loans from banks and other financial institutions; as of June 30, 2024, cash and cash equivalents increased, but net current liabilities remained negative, and the gearing ratio rose; the Group plans to effectively reduce its gearing ratio by enhancing profitability, strengthening equity financing, and diversifying funding channels - As of June 30, 2024, cash and cash equivalents were **RMB331,854 thousand** (December 31, 2023: RMB256,724 thousand)[21](index=21&type=chunk) - Current assets were **RMB3,898,174 thousand**, current liabilities were **RMB4,470,488 thousand**, and the current ratio was **87.2%** (December 31, 2023: 80.0%)[21](index=21&type=chunk) - Outstanding bank and other borrowings were approximately **RMB3,844,529 thousand**, of which approximately **RMB3,544,224 thousand** are repayable within one year[22](index=22&type=chunk) - Gearing ratio was **48.7%** (December 31, 2023: 41.7%)[22](index=22&type=chunk) - The Group had unutilized bank facilities of approximately **RMB626,970 thousand**, available for drawdown to fund operations[22](index=22&type=chunk) - To reduce the gearing ratio, the Group will strengthen management to optimize production, enhance equity financing capabilities, and diversify financing channels to lower financing costs[22](index=22&type=chunk) [Pledges and Guarantees](index=14&type=section&id=Pledges%20and%20Guarantees) Details of the Group's pledges and guarantees primarily pertain to bank and other borrowings, with specific information available in Note 13 to the financial statements of this report - For details of the Group's pledges and guarantees as of June 30, 2024, please refer to Note 13 — Bank and other borrowings in the financial statements of this report[23](index=23&type=chunk) [Market Risks](index=14&type=section&id=Market%20Risks) The Group is exposed to various market risks, including fluctuations in gold and other commodity prices, interest rate changes, foreign currency exchange rate movements, and inflation; the Group does not engage in speculative commodity derivatives or futures, using all derivative instruments solely to hedge against potential volatility in gold and other commodity prices - The Group is exposed to various market risks, including gold price and other commodity value fluctuations, as well as changes in interest rates, foreign currency exchange rates, and inflation[24](index=24&type=chunk) - The Group does not and strictly prohibits the use of commodity derivatives or futures for speculative purposes; all commodity derivatives are used to hedge against any potential fluctuations in gold and other commodity prices[25](index=25&type=chunk) - The interest rates on the Group's bank loans may be adjusted by lenders in accordance with changes in relevant People's Bank of China regulations, and an increase in interest rates would raise financing costs[26](index=26&type=chunk) - The Group's transactions are primarily conducted in RMB, but certain bank deposits, trade and other receivables, trade and other payables, and bank loans denominated in foreign currencies are exposed to exchange rate risk, primarily from the US dollar[27](index=27&type=chunk) [Contractual Obligations](index=15&type=section&id=Contractual%20Obligations) As of June 30, 2024, the Group's total capital commitments not provided for in the financial statements amounted to approximately **RMB344,032 thousand**, a decrease of approximately **RMB32,011 thousand** from the end of 2023 - As of June 30, 2024, the Group's total capital commitments for contracted costs not provided for in the financial statements amounted to approximately **RMB344,032 thousand** (December 31, 2023: RMB376,043 thousand), a decrease of approximately **RMB32,011 thousand**[28](index=28&type=chunk) [Capital Expenditure](index=15&type=section&id=Capital%20Expenditure) The Group's capital expenditure for the period was approximately **RMB288,056 thousand**, an increase of approximately **42.9%** year-on-year, primarily allocated to mine construction projects, renewal of subsidiaries' mining rights, expansion project equipment, and production equipment upgrades - The Group's capital expenditure for the period was approximately **RMB288,056 thousand**, an increase of approximately **42.9%** compared to approximately RMB201,619 thousand in the same period of 2023[28](index=28&type=chunk) - The Group's capital expenditure primarily involved mine construction projects, renewal of mining rights for other related subsidiaries, equipment for expansion projects, and upgrades to production equipment[28](index=28&type=chunk) [Contingent Liabilities](index=15&type=section&id=Contingent%20Liabilities) As of June 30, 2024, the Group had no significant contingent liabilities - As of June 30, 2024, the Group had no significant contingent liabilities[28](index=28&type=chunk) [Human Resources](index=15&type=section&id=Human%20Resources) As of June 30, 2024, the Group had **3,646 employees**, a decrease of **457** from the end of 2023; the Group determines its remuneration policy based on merit, seniority, and competence, offering training opportunities and incentive schemes - As of June 30, 2024, the Group had **3,646 employees** (December 31, 2023: 4,103 employees)[28](index=28&type=chunk) - The Group recruits and promotes employees based on individual capabilities and development potential, and determines remuneration for all employees with reference to individual performance and prevailing market salary levels[28](index=28&type=chunk) - The Group is committed to training and developing its employees, providing ample training opportunities and diverse training programs, and formulating remuneration incentive policies[28](index=28&type=chunk) [Funding and Treasury Policy](index=15&type=section&id=Funding%20and%20Treasury%20Policy) The Group maintains a prudent funding and treasury policy, depositing surplus funds with licensed banks and financial institutions; the Board closely monitors the Group's liquidity position to ensure that the liquidity structure of its assets, liabilities, and other commitments can meet funding requirements - The Group maintains a prudent funding and treasury policy, with surplus funds held as cash deposits with licensed banks and financial institutions[29](index=29&type=chunk) - The Board closely monitors the Group's liquidity position to ensure that the liquidity structure of its assets, liabilities, and other commitments can meet its funding requirements from time to time[29](index=29&type=chunk) [Significant Investments](index=16&type=section&id=Significant%20Investments) As of June 30, 2024, the Group held no significant investments - As of June 30, 2024, the Group held no significant investments[30](index=30&type=chunk) [Significant Acquisitions and Disposals of Subsidiaries, Associates, and Joint Ventures](index=16&type=section&id=Significant%20Acquisitions%20and%20Disposals%20of%20Subsidiaries%2C%20Associates%2C%20and%20Joint%20Ventures) During the period, there were no significant acquisitions or disposals of subsidiaries, associates, or joint ventures by the Group - During the period, there were no significant acquisitions or disposals of subsidiaries, associates, or joint ventures[30](index=30&type=chunk) [Future Plans for Material Investments or Capital Assets](index=16&type=section&id=Future%20Plans%20for%20Material%20Investments%20or%20Capital%20Assets) Except as disclosed elsewhere in this report, as of the date of this report, the Group had no other future plans for material acquisitions, investments, or capital assets - Except as disclosed elsewhere in this report, as of the date of this report, the Group had no other future plans for material acquisitions, investments, or capital assets[30](index=30&type=chunk) [Other Information](index=16&type=section&id=Other%20Information) [Share Capital](index=17&type=section&id=Share%20Capital) As of June 30, 2024, the Company's total share capital was **1,243,476,055 shares**, comprising domestic and H shares, with H shares accounting for **54.40%** of the total Share Capital Structure (As of June 30, 2024) | Share Type | Number of Shares | Approx. Percentage of Total Share Capital | | :------- | :------------ | :--------------------- | | Domestic Shares | 566,975,091 | 45.60% | | H Shares | 676,500,964 | 54.40% | | **Total** | **1,243,476,055** | **100.00%** | [Issue of Equity Securities for Cash](index=17&type=section&id=Issue%20of%20Equity%20Securities%20for%20Cash) For the six months ended June 30, 2024, the Company successfully raised funds through two H share placements, with net proceeds primarily used for purchasing gold concentrate for gold bar production - On February 28, 2024, a placement of **32,538,000 H shares** was completed, raising approximately **HK$42.4 million** net, intended for purchasing gold concentrate for gold bar production[31](index=31&type=chunk) - On April 25, 2024, a placement of **26,916,800 H shares** was completed, raising approximately **HK$79.3 million** net, intended for purchasing gold concentrate for gold bar production[32](index=32&type=chunk) [Purchase, Sale or Redemption of the Company's Listed Securities](index=18&type=section&id=Purchase%2C%20Sale%20or%20Redemption%20of%20the%20Company's%20Listed%20Securities) For the six months ended June 30, 2024, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's shares, and the Company held no treasury shares - For the six months ended June 30, 2024, neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's shares[33](index=33&type=chunk) - As of June 30, 2024, the Company held no treasury shares[33](index=33&type=chunk) [Directors' and Chief Executive's Interests and Short Positions in the Company's Shares](index=18&type=section&id=Directors'%20and%20Chief%20Executive's%20Interests%20and%20Short%20Positions%20in%20the%20Company's%20Shares) As of June 30, 2024, Mr. Wang Guanran, a non-executive director, held significant interests in the Company's domestic and H shares through controlled corporations; apart from this, no other directors or chief executives had disclosable interests or short positions in the Company's shares Shareholdings of Directors and Chief Executive (As of June 30, 2024) | Name and Position | Description of Shares | Nature of Interest | Number of Shares Held | Approx. Percentage of Total Issued Domestic Share Capital | Approx. Percentage of Total Issued H Share Capital | Approx. Percentage of Total Share Capital | | :------------------------ | :------- | :----------- | :-------------------------- | :--------------------------------- | :------------------------------ | :--------------------- | | Mr. Wang Guanran (Non-executive Director) | Domestic Shares | Interest in controlled corporation | 185,339,000 (L) | 32.69% | — | 14.90% | | Mr. Wang Guanran (Non-executive Director) | H Shares | Interest in controlled corporation | 319,772,164 (L) | — | 47.27% | 25.72% | - Mr. Wang Guanran indirectly controls the Company's shares through Jiesi Weiye and Jiesi Industrial[36](index=36&type=chunk) [Substantial Shareholders' Interests and Short Positions in the Company's Shares](index=19&type=section&id=Substantial%20Shareholders'%20Interests%20and%20Short%20Positions%20in%20the%20Company's%20Shares) As of June 30, 2024, Jiesi Weiye and Jiesi Industrial Development (Hong Kong) Co., Ltd. were substantial shareholders of the Company, holding significant interests in its domestic and H shares, respectively; Jiesi Weiye's total voting rights make it a substantial shareholder of the Company Substantial Shareholders' Domestic Shareholdings (As of June 30, 2024) | Name of Shareholder | Nature of Interest | Number of Shares Held | Approx. Percentage of Total Domestic Share Capital | Approx. Percentage of Total Share Capital | | :------------------------------- | :------- | :-------------- | :------------------------- | :--------------------- | | Jiesi Weiye | Beneficial owner | 185,339,000 (L) | 32.69% | 14.90% | | Lingbao City State-owned Assets Management Co., Ltd. | Beneficial owner | 73,540,620 (L) | 12.97% | 5.91% | | Shanghai Zhengxi Investment Management Partnership (Limited Partnership) | Beneficial owner | 57,000,000 (L) | 10.05% | 4.58% | Substantial Shareholders' H Shareholdings (As of June 30, 2024) | Name of Shareholder | Nature of Interest | Number of Shares Held | Approx. Percentage of Total Issued H Share Capital | Approx. Percentage of Total Share Capital | | :------------------------------------------- | :----------- | :-------------- | :------------------------------ | :--------------------- | | Jiesi Industrial Development (Hong Kong) Co., Ltd. ("Jiesi Industrial") | Beneficial owner | 319,772,164 (L) | 47.27% | 25.72% | | Shenzhen Jiesi Dingxin Holdings Co., Ltd. ("Jiesi Dingxin") | Interest in controlled corporation | 319,772,164 (L) | 47.27% | 25.72% | | Shenzhen Jiesi Weiye Holdings Co., Ltd. | Interest in controlled corporation | 319,772,164 (L) | 47.27% | 25.72% | - Jiesi Weiye's total voting rights (Domestic Shares + H Shares) amounted to **40.62%**, making it a substantial shareholder of the Company[90](index=90&type=chunk) [Changes in Information of Directors and Supervisors](index=21&type=section&id=Changes%20in%20Information%20of%20Directors%20and%20Supervisors) In accordance with the Articles of Association, the terms of the Seventh Board of Directors and Supervisory Committee expired on May 28, 2024; members of the Eighth Board of Directors and Supervisory Committee were elected at the Annual General Meeting held on May 29, 2024, with appointments and resignations/retirements of relevant directors and supervisors disclosed - The terms of the Seventh Board of Directors and Supervisory Committee expired on **May 28, 2024**[40](index=40&type=chunk) - Members of the Eighth Board of Directors and Supervisory Committee were officially elected at the Annual General Meeting held on **May 29, 2024**[40](index=40&type=chunk) - Mr. Chen Jianzheng was appointed as Chairman, Executive Director, and Chairman of the Strategy Committee[40](index=40&type=chunk) - Mr. Dai Weitao, Mr. Wang Guanghua, Mr. Wang Jiheng, and Mr. Xu Rong resigned/retired from their positions as executive directors or independent non-executive directors[41](index=41&type=chunk) [Dividends](index=23&type=section&id=Dividends) The Company declared and approved the final dividend for the year ended December 31, 2023, at the Annual General Meeting on May 29, 2024, which was paid on July 31, 2024; the Board does not recommend an interim dividend for the six months ended June 30, 2024 - For the six months ended June 30, 2024, shareholders of the Company declared and approved a final dividend of **RMB0.065 per share** for the year ended December 31, 2023, at the Annual General Meeting held on May 29, 2024[42](index=42&type=chunk) - This final dividend was paid to the Company's shareholders on **July 31, 2024**[42](index=42&type=chunk) - The Board does not recommend the payment of an interim dividend for the six months ended June 30, 2024[42](index=42&type=chunk) [Corporate Governance](index=23&type=section&id=Corporate%20Governance) The Company is committed to maintaining a robust, transparent, and prudent corporate governance framework, having adopted the code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the Listing Rules, and has complied with these provisions during the period - The Company has adopted the code provisions of the Corporate Governance Code set out in Appendix C1 Part 2 of the Listing Rules as its corporate governance code[43](index=43&type=chunk) - During the period, the Company complied with the code provisions of the Corporate Governance Code[43](index=43&type=chunk) [Standard Code for Securities Transactions](index=23&type=section&id=Standard%20Code%20for%20Securities%20Transactions) The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers, as set out in Appendix C3 of the Listing Rules, as its code of conduct for securities transactions by directors and supervisors, and all directors and supervisors complied with this code during the period - The Company has adopted the Model Code for Securities Transactions by Directors of Listed Issuers, as set out in Appendix C3 of the Listing Rules, as its code of conduct for securities transactions by directors and supervisors[44](index=44&type=chunk) - Based on specific inquiries made to all directors and supervisors, they have complied with the required standards set out in the Model Code during the period[44](index=44&type=chunk) [Audit Committee](index=23&type=section&id=Audit%20Committee) The Audit Committee, comprising four independent non-executive directors and one non-executive director, convened on August 28, 2024, to review the unaudited interim financial report for the six months ended June 30, 2024 - The Audit Committee comprises four independent non-executive directors and one non-executive director, namely Mr. Yang Zhida (Chairman), Mr. Zhang Feihu, Mr. Chen Congfa, Mr. Bo Shaochuan, and Mr. Guo Xinsheng[45](index=45&type=chunk) - An Audit Committee meeting was held on **August 28, 2024**, to review the unaudited interim financial report for the six months ended June 30, 2024, and this interim report[45](index=45&type=chunk) [Events After the Reporting Period](index=23&type=section&id=Events%20After%20the%20Reporting%20Period) No significant events occurred after the reporting period - No significant events occurred after the reporting period[45](index=45&type=chunk) [Review Report](index=23&type=section&id=Review%20Report) [Introduction](index=23&type=section&id=Introduction) BDO Limited has reviewed the condensed interim financial report of Lingbao Gold Group Co., Ltd. and its subsidiaries for the six months ended June 30, 2024, prepared in accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and Hong Kong Accounting Standard 34 issued by the Hong Kong Institute of Certified Public Accountants - Our auditors have reviewed the condensed interim financial report of Lingbao Gold Group Co., Ltd. and its subsidiaries, presented on pages 24 to 50[45](index=45&type=chunk) - The interim financial report must comply with the relevant requirements under the Listing Rules and Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants[45](index=45&type=chunk) [Scope of Review](index=24&type=section&id=Scope%20of%20Review) The review was conducted in accordance with Hong Kong Standard on Review Engagements 2410 issued by the Hong Kong Institute of Certified Public Accountants, primarily involving inquiries of personnel responsible for financial and accounting matters, and performing analytical and other review procedures; as the scope of a review is less than that of an audit, no audit opinion is expressed - We have conducted our review in accordance with Hong Kong Standard on Review Engagements 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Hong Kong Institute of Certified Public Accountants[46](index=46&type=chunk) - A review consists principally of making inquiries of management and others responsible for financial and accounting matters and applying analytical and other review procedures[46](index=46&type=chunk) - Because the scope of a review is substantially less than that of an audit conducted in accordance with Hong Kong Standards on Auditing, it does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit; accordingly, we do not express an audit opinion[46](index=46&type=chunk) [Conclusion](index=24&type=section&id=Conclusion) Based on the review, the auditors have not become aware of any matter that causes them to believe that the interim financial report for the six months ended June 30, 2024, is not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34 - Based on our review, nothing has come to our attention that causes us to believe that the interim financial report as of June 30, 2024, is not prepared, in all material respects, in accordance with Hong Kong Accounting Standard 34[47](index=47&type=chunk) [Condensed Consolidated Statement of Profit or Loss](index=24&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) [Condensed Consolidated Statement of Profit or Loss](index=24&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) For the six months ended June 30, 2024, the Group's revenue was **RMB4,281,228 thousand**, a **26.67% year-on-year decrease**; despite lower revenue, gross profit **increased by 14.72% to RMB407,686 thousand**, and profit for the period **grew by 26.73% to RMB152,658 thousand**, with basic earnings per share at **RMB0.13** Key Data from Condensed Consolidated Statement of Profit or Loss (Six Months Ended June 30) | Indicator | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | Y-o-Y Change (%) | | :----------- | :------------------------ | :------------------------ | :----------- | | Revenue | 4,281,228 | 5,838,583 | -26.67% | | Cost of sales | (3,873,542) | (5,483,207) | -29.35% | | Gross profit | 407,686 | 355,376 | +14.72% | | Operating profit | 256,570 | 282,644 | -9.22% | | Profit before tax | 182,511 | 194,846 | -6.49% | | Profit for the period | 152,658 | 120,467 | +26.73% | | Profit attributable to equity holders of the Company | 152,538 | 140,352 | +8.68% | | Basic earnings per share | 0.13 (RMB) | 0.16 (RMB) | -18.75% | [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=25&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) [Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income](index=25&type=section&id=Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss%20and%20Other%20Comprehensive%20Income) For the six months ended June 30, 2024, the Group's profit for the period was **RMB152,658 thousand**, with total comprehensive income of **RMB145,136 thousand**, which included an exchange difference loss of **RMB7,522 thousand** arising from the translation of financial statements of overseas subsidiaries Key Data from Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income (Six Months Ended June 30) | Indicator | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | | :--------------- | :------------------------ | :------------------------ | | Profit for the period | 152,658 | 120,467 | | Exchange differences | (7,522) | (31,900) | | Total comprehensive income for the period | 145,136 | 88,567 | | Attributable to equity holders of the Company | 146,257 | 115,525 | | Attributable to non-controlling interests | (1,121) | (26,958) | [Condensed Consolidated Statement of Financial Position](index=26&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) [Condensed Consolidated Statement of Financial Position](index=26&type=section&id=Condensed%20Consolidated%20Statement%20of%20Financial%20Position) As of June 30, 2024, the Group's total assets less current liabilities amounted to **RMB3,430,978 thousand**, with net assets of **RMB2,612,111 thousand**; non-current assets saw increases in construction in progress and right-of-use assets, while pledged deposits significantly rose among current assets; net current liabilities improved but remained negative Key Data from Condensed Consolidated Statement of Financial Position (As of June 30, 2024) | Indicator | June 30, 2024 (RMB thousand) | December 31, 2023 (RMB thousand) | | :--------------- | :------------------------- | :-------------------------- | | **Non-current assets** | | | | Property, plant and equipment | 2,042,770 | 2,031,326 | | Construction in progress | 458,220 | 351,296 | | Intangible assets | 973,299 | 973,689 | | **Current assets** | | | | Inventories | 1,443,835 | 1,590,875 | | Trade and other receivables | 563,185 | 413,884 | | Pledged deposits | 1,559,300 | 699,880 | | Cash and cash equivalents | 331,854 | 256,724 | | **Current liabilities** | | | | Bank and other borrowings | 3,544,224 | 2,725,108 | | Trade and other payables | 844,532 | 880,158 | | **Net current liabilities** | (572,314) | (741,768) | | **Net assets** | 2,612,111 | 2,436,554 | [Condensed Consolidated Statement of Changes in Equity](index=28&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) [Condensed Consolidated Statement of Changes in Equity](index=28&type=section&id=Condensed%20Consolidated%20Statement%20of%20Changes%20in%20Equity) For the six months ended June 30, 2024, the Group's total equity increased from **RMB2,436,554 thousand** at the end of 2023 to **RMB2,612,111 thousand**; profit for the period was **RMB152,538 thousand**, alongside H share capital injection and the distribution of the 2023 final dividend - Total equity as of June 30, 2024, was **RMB2,612,111 thousand**, an increase from **RMB2,436,554 thousand** as of December 31, 2023[53](index=53&type=chunk) - Profit for the period attributable to equity holders of the Company was **RMB152,538 thousand**[53](index=53&type=chunk) - In the first half of 2024, **RMB111,443 thousand** was injected through the issuance of H shares[53](index=53&type=chunk) - Final dividends declared and approved amounted to **RMB80,826 thousand**[53](index=53&type=chunk) [Condensed Consolidated Statement of Cash Flows](index=29&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) [Condensed Consolidated Statement of Cash Flows](index=29&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2024, the Group's net cash generated from operating activities was **RMB168,088 thousand**; net cash used in investing activities significantly increased to **RMB1,115,185 thousand**, primarily due to a substantial increase in net pledged deposits for borrowings; net cash generated from financing activities was **RMB1,027,061 thousand**, mainly from bank and other borrowings and proceeds from H share issuance Key Data from Condensed Consolidated Statement of Cash Flows (Six Months Ended June 30) | Indicator | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | | :------------------- | :------------------------ | :------------------------ | | Net cash generated from operating activities | 168,088 | 214,868 | | Net cash used in investing activities | (1,115,185) | (178,127) | | Net cash generated from financing activities | 1,027,061 | 19,149 | | Net increase in cash and cash equivalents | 79,964 | 55,890 | | Cash and cash equivalents at end of period | 331,854 | 230,191 | - Net cash used in investing activities significantly increased, primarily due to a net increase of **RMB848,000 thousand** in pledged deposits for borrowings[55](index=55&type=chunk) - Net cash generated from financing activities primarily stemmed from proceeds from bank and other borrowings of **RMB3,229,270 thousand** and net proceeds from H share issuance of **RMB111,443 thousand**[55](index=55&type=chunk) [Notes to the Unaudited Interim Financial Report](index=30&type=section&id=Notes%20to%20the%20Unaudited%20Interim%20Financial%20Report) [Basis of Preparation](index=30&type=section&id=Basis%20of%20Preparation) This note outlines the basis of preparation for the interim financial report, which is prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and complies with the disclosure requirements of the Listing Rules; the report has been reviewed and authorized for issue by the Audit Committee - This interim financial report has been prepared in accordance with Hong Kong Accounting Standard 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants and complies with the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited[56](index=56&type=chunk) - The report has been reviewed by the Audit Committee of Lingbao Gold Group Co., Ltd. and was authorized for issue on **August 28, 2024**[56](index=56&type=chunk) [Going Concern](index=31&type=section&id=Going%20Concern) As of June 30, 2024, the Group had net current liabilities and capital commitments, with most bank facilities requiring renewal within one year; the directors have assessed and deemed the going concern assumption appropriate, planning to mitigate liquidity pressure by drawing on unutilized bank facilities and actively negotiating renewals or refinancing to ensure continued operations for the next 12 months - As of June 30, 2024, the Group had net current liabilities of **RMB572,314,000** and capital commitments of **RMB344,032,000**[57](index=57&type=chunk) - Current liabilities included bank and other borrowings of **RMB3,544,224,000** repayable within one year[57](index=57&type=chunk) - The Group had uncommitted unutilized bank facilities of **RMB626,970,000** related to unsecured bank borrowings, which management will consider drawing upon to safeguard its financial position[57](index=57&type=chunk) - Management is actively negotiating with banks to renew or extend existing bank facilities to secure financing[57](index=57&type=chunk) [Changes in Accounting Policies](index=32&type=section&id=Changes%20in%20Accounting%20Policies) New and revised Hong Kong Financial Reporting Standards and Interpretations issued by the Hong Kong Institute of Certified Public Accountants, effective for the Group's current accounting period, have had no significant impact on how the Group presents its results and financial position for current or prior periods in this interim report - The Hong Kong Institute of Certified Public Accountants has issued the following new and revised Hong Kong Financial Reporting Standards and Interpretations, which are effective for the Group's current accounting period for the first time[59](index=59&type=chunk) - None of these developments have had a significant impact on how the Group presents its results and financial position for current or prior periods in this interim report[59](index=59&type=chunk) [Segment Reporting](index=33&type=section&id=Segment%20Reporting) The Group is organized and managed into four reportable segments based on business combinations (production processes, products, and services) and geographical areas: China gold mining and beneficiation, Kyrgyzstan gold mining and beneficiation, China gold and other metal smelting and refining, and China gold and other jewelry retail business - The Group is organized and managed into segments based on business combinations (production processes, products, and services) and geographical areas[60](index=60&type=chunk) - The Group identifies four reportable segments: China Mining, Kyrgyzstan Mining, Smelting, and Retail[61](index=61&type=chunk) [Segment Results, Assets and Liabilities](index=33&type=section&id=Segment%20Results%2C%20Assets%20and%20Liabilities) This section presents revenue, impairment, and other relevant financial information for each of the Group's reportable segments, used by the chief operating decision-maker for resource allocation and performance assessment - Information regarding the Group's reportable segments provided to the Group's chief operating decision-maker for the purpose of allocating resources and assessing segment performance for the period is set out below[61](index=61&type=chunk) [Reconciliation of Reportable Segment Revenue and Profit or Loss](index=34&type=section&id=Reconciliation%20of%20Reportable%20Segment%20Revenue%20and%20Profit%20or%20Loss) This section provides a reconciliation of reportable segment revenue and profit or loss to consolidated revenue and profit before tax, illustrating the Group's overall financial performance after inter-segment eliminations Reconciliation of Reportable Segment Revenue and Profit or Loss (Six Months Ended June 30) | Indicator | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | | :------------------- | :------------------------ | :------------------------ | | Reportable segment revenue | 5,074,098 | 7,115,844 | | Elimination of inter-segment revenue | (792,870) | (1,277,261) | | Consolidated revenue | 4,281,228 | 5,838,583 | | Reportable segment profit | 248,894 | 374,983 | | Elimination of inter-segment loss/(profit) | 49,810 | (114,645) | | Consolidated profit before tax | 182,511 | 194,846 | | Profit for the period | 152,658 | 120,467 | [Revenue](index=35&type=section&id=Revenue) The Group's principal activities are the mining, beneficiation, smelting, and sale of gold and other metal products in China; revenue represents the sales value of goods sold to customers, net of sales tax and value-added tax; in the first half of 2024, gold sales revenue amounted to **RMB4,232,540 thousand**, constituting the vast majority of total revenue - The Group's principal activities are the mining, beneficiation, smelting, and sale of gold and other metal products in China[64](index=64&type=chunk) - Revenue represents the sales value of goods sold to customers, net of sales tax and value-added tax[64](index=64&type=chunk) Revenue Breakdown (By Major Product Line, Six Months Ended June 30) | Product Line | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | | :------------- | :------------------------ | :------------------------ | | Sales of gold | 4,232,540 | 5,639,239 | | Sales of other metals | 81,098 | 191,375 | | Sales of jewelry | 2,347 | 6,777 | | Others | 4,535 | 32,834 | | Less: Sales tax and levies | (39,292) | (31,642) | | **Total Revenue** | **4,281,228** | **5,838,583** | [Profit Before Tax](index=35&type=section&id=Profit%20Before%20Tax) This section details the composition of the Group's profit before tax, including finance costs, net other (losses)/gains, and other items; in the first half of 2024, finance costs decreased, but realized and unrealized losses on financial instruments at fair value through profit or loss increased Finance Costs (Six Months Ended June 30) | Item | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | | :----------- | :------------------------ | :------------------------ | | Interest expense on bank loans | 28,546 | 66,286 | | Interest expense on lease liabilities | 392 | 814 | | Other borrowing costs | 45,121 | 19,186 | | **Total** | **74,059** | **86,286** | Net Other (Losses)/Gains (Six Months Ended June 30) | Item | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | | :--------------------------------- | :------------------------ | :------------------------ | | Net realized and unrealized (losses)/gains on financial instruments at fair value through profit or loss | (20,324) | 908 | | Net foreign exchange gains | 5,732 | 49,793 | | Fines and penalties | (6,077) | — | | Gain on disposal of property, plant and equipment | 873 | — | | Others | (4,814) | (1,543) | | **Total** | **(24,680)** | **49,158** | [Income Tax in Condensed Consolidated Statement of Profit or Loss](index=37&type=section&id=Income%20Tax%20in%20Condensed%20Consolidated%20Statement%20of%20Profit%20or%20Loss) This section discloses the Group's income tax components, including current tax and deferred tax; Chinese subsidiaries are subject to a statutory tax rate of **25%**, with Habahe Huatai Gold Co., Ltd. enjoying a preferential tax rate of **15%**; Hong Kong subsidiaries made no provision for Hong Kong profits tax due to accumulated tax losses, and the corporate income tax rate in Kyrgyzstan is **0%** Income Tax (Six Months Ended June 30) | Item | H1 2024 (RMB thousand) | H1 2023 (RMB thousand) | | :--------------- | :------------------------ | :------------------------ | | Current tax — PRC income tax | | | | Provision for the period | 43,449 | 88,402 | | Over-provision in prior years | (19,335) | (6,453) | | Deferred tax | 5,739 | (7,570) | | **Total** | **29,853** | **74,379** | - The Company and its PRC subsidiaries are subject to income tax at a statutory rate of **25%**[66](index=66&type=chunk) - Habahe Huatai Gold Co., Ltd. enjoys a preferential income tax rate of **15%** from January 1, 2023[67](index=67&type=chunk) - The corporate income tax rate in Kyrgyzstan for 2024 is **0%**[67](index=67&type=chunk) [Earnings Per Share](index=37&type=section&id=Earnings%20Per%20Share) This section provides the calculation methods for basic and diluted earnings per share; for the six months ended June 30, 2024, basic earnings per share were **RMB0.1254**, and diluted earnings per share were the same as basic earnings per share - Basic earnings per share for the six months ended June 30, 2024, were calculated based on profit attributable to equity holders of the Company of **RMB152,538,000** and the weighted average number of ordinary shares outstanding of **1,216,246,829 shares**, amounting to **RMB0.1254**[67](index=67&type=chunk) - As there were no dilutive potential ordinary shares for the six months ended June 30, 2024, and 2023, diluted earnings per share for both periods were the same as basic earnings per share[67](index=67&type=chunk) [Property, Plant and Equipment and Construction in Progress](index=38&type=section&id=Property%2C%20Plant%20and%20Equipment%20and%20Construction%20in%20Progress) For the six months ended June 30, 2024, the Group acquired property, plant and equipment of **RMB10,099 thousand** and added construction in progress of **RMB207,136 thousand**; the disposal of property, plant and equipment generated a gain of **RMB873 thousand** - For the six months ended June 30, 2024, the Group acquired property, plant and equipment of **RMB10,099,000** and added construction in progress of **RMB207,136,000**, respectively[68](index=68&type=chunk) - The disposal of property, plant and equipment items with a total net book value of **RMB766,000** resulted in a gain on disposal of **RMB873,000**[68](index=68&type=chunk) [Intangible Assets](index=38&type=section&id=Intangible%20Assets) For the six months ended June 30, 2024, the Group added exploration and evaluation assets of **RMB25,706 thousand**; no intangible assets were disposed of during the period - For the six months ended June 30, 2024, the Group added exploration and evaluation assets of **RMB25,706,000**[68](index=68&type=chunk) - No intangible assets were disposed of for the six months ended June 30, 2024[68](index=68&type=chunk) [Inventories](index=38&type=section&id=Inventories) As of June 30, 2024, the Group's total inventories amounted to **RMB1,443,835 thousand**, primarily comprising raw materials, work in progress, and finished goods; the carrying amount of inventories sold recognized as an expense during the period was **RMB3,872,711 thousand** Inventories Composition (As of June 30, 2024) | Item | June 30, 2024 (RMB thousand) | December 31, 2023 (RMB thousand) | | :----------- | :------------------------- | :-------------------