Financial Performance - The company's operating revenue for 2020 was CNY 53.12 billion, an increase of 10.74% compared to CNY 47.97 billion in 2019[23]. - Net profit attributable to shareholders for 2020 was CNY 2.85 billion, reflecting a 9.20% increase from CNY 2.61 billion in 2019[23]. - The net cash flow from operating activities decreased by 41.01% to CNY 2.57 billion in 2020, down from CNY 4.35 billion in 2019[23]. - The total assets at the end of 2020 were CNY 47.91 billion, a 9.83% increase from CNY 43.62 billion at the end of 2019[23]. - Basic earnings per share for 2020 were CNY 0.5550, a decrease of 5.75% from CNY 0.5888 in 2019[24]. - The weighted average return on equity for 2020 was 14.53%, down from 16.37% in 2019, a decrease of 1.84 percentage points[24]. - The company reported non-recurring gains of CNY 383.36 million in 2020, compared to CNY 256.91 million in 2019[27]. - The gross profit margin for advanced steel materials was 14.90%, an increase of 1.18 percentage points year-on-year, with a total gross profit of 1.117 billion yuan, up 19.21%[56]. - The company achieved a net profit of 3.188 billion yuan in the reporting period, with a decrease of 41.01% in net cash flow from operating activities compared to the previous year[95]. Dividend Distribution - The company plans to distribute a cash dividend of RMB 2.50 per 10 shares to all shareholders, excluding the repurchased shares, based on a total share capital of 21,980,000 shares in the repurchase account[6]. - The cash dividend payout ratio for 2020 was 53.80% of the net profit attributable to ordinary shareholders, compared to 50.80% in 2019[154]. - The total cash dividends distributed in 2019 amounted to RMB 1,323,906,707.10, with a dividend of RMB 3.00 per 10 shares[150]. - The company's net profit for 2020 was RMB 712,847,742.74, leading to a cumulative distributable profit of RMB 2,400,700,210.38 after accounting for the previous year's dividend[151]. - The independent directors approved the 2020 profit distribution plan, confirming it aligns with regulatory guidelines and does not harm shareholder interests[152]. Corporate Governance - The company has confirmed that all board members attended the board meeting[4]. - The company has not violated any decision-making procedures for providing guarantees[8]. - The company does not have any non-operating fund occupation by controlling shareholders or related parties[8]. - The company has committed to maintaining independence from its controlling shareholders, ensuring personnel, assets, finances, and operations remain separate[173]. - The company guarantees that it will not interfere with the management activities of its subsidiaries or misappropriate their interests[174]. Market Position and Strategy - The company has an annual crude steel production capacity of 10 million tons, positioning itself as a leading high-efficiency steel enterprise[32]. - The company focuses on creating an ecosystem centered around new steel materials, emphasizing industrial development and value growth[32]. - The company is one of the largest single-site medium and thick plate production bases globally and a competitive special steel long product production base in China[33]. - The company has developed advanced energy steel and high-strength marine steel, contributing to major national projects and achieving significant technological breakthroughs[33]. - The company is focusing on the development of high-performance materials for the rapidly growing rail transit sector, addressing the urgent demand for advanced materials[94]. Research and Development - The company has developed 166 new products and technological achievements, with 92 reaching international leading or advanced levels[47]. - The company has established a high-end R&D platform with 32 achievements recognized at provincial and ministerial levels since 2010[49]. - The company holds 979 valid patents, including 392 invention patents, and has received a China Patent Excellence Award[50]. - Research and development expenses increased by 45.85% to 848.91 million yuan, primarily due to increased investment in digital R&D and new product development[89]. - The total R&D investment reached 212.50 million yuan, representing 4.00% of operating revenue[90]. Environmental and Social Responsibility - The company is focusing on low-carbon and green development, aiming for peak carbon emissions by 2030 and carbon neutrality by 2060[131]. - The company reduced its total emissions of key pollutants, with particulate matter, sulfur dioxide, and nitrogen oxides decreasing by 15%, 48%, and 47% respectively[70]. - The company aims to achieve ultra-low emissions and meet A-level standards by enhancing its production processes[134]. - The company has committed to not utilizing its controlling position to occupy funds, assets, or other resources of its subsidiaries[179]. Financial Position and Investments - The company's cash and cash equivalents increased to ¥5,686,920,373.25, representing 11.87% of total assets, up 33.33% from the previous period[98]. - The company's total assets reached ¥47,906,285,930.71, a 9.83% increase compared to the previous year[101]. - The company reported a significant increase in goodwill to ¥206,824,872.31, up 1,979.65% due to acquisitions[100]. - The company invested in a new 2.6 million ton per year coke project in Indonesia, expanding its supply chain[71]. - The company completed the acquisition of a 38.72% stake in Nanjing Steel Development for a transaction price of 4.585 billion yuan[199]. Compliance and Legal Matters - The company has not faced any administrative or criminal penalties related to the securities market in the past five years[173]. - There were no significant litigation or arbitration matters during the reporting period[188]. - The company has confirmed that all commitments made are independently enforceable, ensuring the validity of remaining commitments if one is deemed invalid[173]. - The company has not engaged in any major civil lawsuits or arbitrations related to economic disputes in the last five years[173].

[Company Profile and Key Financial Indicators](index=6&type=section&id=%E5%85%AC%E5%8F%B8%E7%AE%80%E4%BB%8B%E5%92%8C%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) This section outlines the company's basic information and key financial performance over the past three years [Company Basic Information](index=6&type=section&id=%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF) Nanjing Iron & Steel Co., Ltd. (Nangang Share) is a Shanghai Stock Exchange-listed company with stock code 600282 - The company's Chinese name is Nanjing Iron & Steel Co., Ltd., with stock abbreviation Nangang Share and stock code **600282**[10](index=10&type=chunk)[14](index=14&type=chunk) [Key Accounting Data and Financial Indicators for the Past Three Years](index=7&type=section&id=%E8%BF%91%E4%B8%89%E5%B9%B4%E4%B8%BB%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%92%8C%E8%B4%A2%E5%8A%A1%E6%8C%87%E6%A0%87) In 2019, operating revenue grew 9.91% to 47.97 billion Yuan, but net profit fell 34.98% to 2.61 billion Yuan, mainly due to increased raw material costs 2017-2019 Key Accounting Data | Indicator | 2019 | 2018 | YoY Change (%) | 2017 | | :--- | :--- | :--- | :--- | :--- | | **Operating Revenue (Yuan)** | 47,970,483,148.92 | 43,646,788,888.30 | 9.91 | 37,600,664,145.81 | | **Net Profit Attributable to Shareholders (Yuan)** | 2,606,224,358.06 | 4,008,192,215.36 | -34.98 | 3,200,349,431.10 | | **Net Profit Attributable to Shareholders Excluding Non-recurring Items (Yuan)** | 2,349,309,400.64 | 3,947,172,833.45 | -40.48 | 3,074,183,971.14 | | **Net Cash Flow from Operating Activities (Yuan)** | 4,348,491,905.18 | 4,938,472,682.58 | -11.95 | 2,361,266,275.26 | | **Net Assets Attributable to Shareholders (Yuan)** | 16,776,789,408.57 | 15,378,951,063.71 | 9.09 | 11,575,266,229.42 | | **Total Assets (Yuan)** | 43,620,513,500.75 | 41,194,585,952.13 | 5.89 | 37,735,444,348.85 | 2017-2019 Key Financial Indicators | Key Financial Indicator | 2019 | 2018 | YoY Change | 2017 | | :--- | :--- | :--- | :--- | :--- | | **Basic Earnings Per Share (Yuan/share)** | 0.5888 | 0.9078 | -35.14% | 0.7856 | | **Weighted Average Return on Net Assets (%)** | 16.37 | 29.81 | Decreased by 13.44 percentage points | 36.80 | [2019 Quarterly Financial Data](index=8&type=section&id=2019%20%E5%B9%B4%E5%88%86%E5%AD%A3%E5%BA%A6%E4%B8%BB%E8%A6%81%E8%B4%A2%E5%8A%A1%E6%95%B0%E6%8D%AE) The company's 2019 performance showed a quarter-over-quarter decline, with significantly weaker profitability in the second half 2019 Quarterly Key Financial Data | Indicator (Yuan) | Q1 | Q2 | Q3 | Q4 | | :--- | :--- | :--- | :--- | :--- | | **Operating Revenue** | 11,815,832,282.21 | 12,279,266,555.77 | 12,635,848,366.78 | 11,239,535,944.16 | | **Net Profit Attributable to Shareholders** | 836,832,175.38 | 1,004,115,617.74 | 534,268,295.60 | 231,008,269.34 | | **Net Profit Attributable to Shareholders Excluding Non-recurring Items** | 773,510,034.58 | 914,018,993.84 | 455,362,632.65 | 206,417,739.57 | | **Net Cash Flow from Operating Activities** | 1,624,137,220.52 | -320,478,981.65 | 831,348,432.65 | 2,213,485,233.66 | [Non-recurring Gains and Losses](index=8&type=section&id=%E9%9D%9E%E7%BB%8F%E5%B8%B8%E6%80%A7%E6%8D%9F%E7%9B%8A%E9%A1%B9%E7%9B%AE) 2019 non-recurring gains and losses totaled 257 million Yuan, driven by fair value changes and investment income - In 2019, total non-recurring gains and losses amounted to **257 million Yuan**, primarily driven by **275 million Yuan** in investment income from the disposal of financial assets held for trading, derivatives, and other debt investments, along with **119 million Yuan** in entrusted investment gains/losses[20](index=20&type=chunk) [Company Business Overview](index=10&type=section&id=%E5%85%AC%E5%8F%B8%E4%B8%9A%E5%8A%A1%E6%A6%82%E8%A6%81) This section outlines the company's core business, operating model, industry landscape, and competitive advantages [Main Business, Operating Model, and Industry Situation](index=10&type=section&id=%E4%B8%BB%E8%A6%81%E4%B8%9A%E5%8A%A1%E3%80%81%E7%BB%8F%E8%90%A5%E6%A8%A1%E5%BC%8F%E5%8F%8A%E8%A1%8C%E4%B8%9A%E6%83%85%E5%86%B5) The company is a full-process steel enterprise with 10 million tons annual crude steel capacity, focusing on specialized plate and high-quality long products - The company is a full-process steel integrated enterprise with an annual crude steel production capacity of **10 million tons**, primarily engaged in new steel materials and synergistic development of information technology and e-commerce[22](index=22&type=chunk) - The company's main products are specialized plate and high-quality special steel long products, widely used in energy, marine engineering, and construction machinery industries, with **5.01 million tons** of medium and heavy plate produced in 2019[23](index=23&type=chunk) - In 2019, China's crude steel output reached **996 million tons**, a **8.3% year-over-year increase**, accounting for **53.3%** of global output; the domestic steel industry's total profit decreased by **30.90% year-over-year**, with sales profit margin falling to **4.43%**[29](index=29&type=chunk)[30](index=30&type=chunk)[31](index=31&type=chunk) [Core Competitiveness Analysis](index=13&type=section&id=%E6%A0%B8%E5%BF%83%E7%AB%9E%E4%BA%89%E5%8A%9B%E5%88%86%E6%9E%90) Core competitiveness stems from integrated state-owned and private advantages, strong products, leading innovation, stable customer relations, and favorable location - The company integrates the traditional advantages of state-owned enterprises with the flexible mechanisms of private enterprises, forming a "community of interests,事业, and destiny" through employee stock ownership and equity incentive plans[37](index=37&type=chunk) - The company possesses strong product capabilities in specialized plate and high-quality special steel long products, with several products, such as steel for cryogenic storage tanks and high-speed rail brake discs, filling domestic gaps or leading market share[38](index=38&type=chunk) - The company has established a "2+3+4" multi-level R&D platform and was recognized as an "Intelligent Manufacturing Pilot Demonstration" by the Ministry of Industry and Information Technology; as of the end of 2019, it held **840 valid authorized patents**, including **351 invention patents**[39](index=39&type=chunk)[40](index=40&type=chunk) - The company has established stable cooperative relationships with renowned domestic and international enterprises such as PetroChina, Sinopec, and Caterpillar, with strategic and key customers accounting for over **30%** and direct sales customers exceeding **60%**; steel sales through the C2M e-commerce platform accounted for over **80%** of total sales[41](index=41&type=chunk) [Discussion and Analysis of Operations](index=15&type=section&id=%E7%BB%8F%E8%90%A5%E6%83%85%E5%86%B5%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) This section details the company's operational highlights, financial performance, asset and liability structure, industry information, and future plans [Operational Highlights and Overall Situation](index=15&type=section&id=%E7%BB%8F%E8%90%A5%E4%BA%AE%E7%82%B9%E4%B8%8E%E6%80%BB%E4%BD%93%E6%83%85%E5%86%B5) In 2019, the company achieved strong production and sales, with 9.93 million tons of steel products sold and a 100.09% production-to-sales ratio, despite industry price declines - During the reporting period, the company's pig iron, crude steel, and steel product output were **9.90 million tons**, **10.97 million tons**, and **9.92 million tons**, respectively, with steel product sales of **9.93 million tons** and a production-to-sales ratio of **100.09%**[43](index=43&type=chunk)[46](index=46&type=chunk) - The company's products demonstrated strong competitiveness, with the decline in the comprehensive average selling price of steel products (**3.99%**) being less than the decline in the China Iron and Steel Association's comprehensive steel price index (**6.64%**)[44](index=44&type=chunk) - The company's capital structure optimized, with the asset-liability ratio decreasing by **2.19 percentage points** year-over-year to **49.72%** in 2019[45](index=45&type=chunk) - Despite a **2.632 billion Yuan** increase in costs due to rising raw material prices, the company achieved a total cost reduction of **1.016 billion Yuan** through various measures, including a **708 million Yuan** reduction in process costs[47](index=47&type=chunk) - The company focused on building an industrial chain ecosystem, with subsidiaries such as Jinheng Technology, Gangbao Shares, and Xinzhi Chain achieving revenue and profit growth, and providing **540 million Yuan** in financial empowerment to **35 customers** through its supply chain finance platform[51](index=51&type=chunk)[52](index=52&type=chunk) [Main Business Analysis](index=18&type=section&id=%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%88%86%E6%9E%90) In 2019, main business revenue rose 9.88% to 47.83 billion Yuan, but operating costs surged 19.35% due to higher raw material prices, significantly lowering gross margin Major Changes in Income Statement and Cash Flow Statement Items | Item | Current Period (Yuan) | Prior Period (Yuan) | Change (%) | | :--- | :--- | :--- | :--- | | **Operating Revenue** | 47,970,483,148.92 | 43,646,788,888.30 | 9.91 | | **Operating Cost** | 41,600,911,936.67 | 34,868,638,855.39 | 19.31 | | **R&D Expenses** | 582,046,360.94 | 446,113,982.99 | 30.47 | | **Financial Expenses** | 275,504,358.40 | 391,122,984.01 | -29.56 | | **Operating Profit** | 4,056,048,890.81 | 6,038,186,295.17 | -32.83 | | **Net Cash Flow from Investing Activities** | -920,705,573.88 | -2,613,482,800.31 | 64.77 | Main Business by Industry Segment | Segment | Operating Revenue (Yuan) | Operating Cost (Yuan) | Gross Margin (%) | YoY Change in Operating Revenue (%) | YoY Change in Operating Cost (%) | YoY Change in Gross Margin | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Steel Business** | 41,016,795,416.02 | 34,982,339,104.02 | 14.71 | 4.29 | 13.24 | Decreased by 6.74 percentage points | | **Trade and Other Businesses** | 6,809,445,016.01 | 6,533,371,414.50 | 4.05 | 62.22 | 67.75 | Decreased by 3.17 percentage points | Production and Sales Analysis (million tons) | Main Product | Production Volume | Sales Volume | Inventory Volume | YoY Change in Production Volume (%) | YoY Change in Sales Volume (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Plate | 5.0104 | 4.9859 | 0.2182 | 8.02 | 8.01 | | Bar | 3.4218 | 3.4494 | 0.0502 | 5.30 | 4.85 | | Total | 9.9206 | 9.9297 | 0.2980 | 8.17 | 8.07 | - Total R&D investment in 2019 was **1.823 billion Yuan**, accounting for **3.80%** of operating revenue; the company completed **63 new product developments** and achieved breakthroughs in **15 key technologies**, including nickel-saving 7Ni steel for LNG storage tanks[64](index=64&type=chunk)[65](index=65&type=chunk) - Net cash flow from operating activities decreased by **11.95% year-over-year**, primarily due to a **1.376 billion Yuan** decrease in net profit; net cash flow from investing activities increased by **1.693 billion Yuan**, mainly due to a higher base from increased capital in Baizhong Environment in the prior year; net cash flow from financing activities decreased by **590 million Yuan**, primarily due to a year-over-year increase in cash dividends[68](index=68&type=chunk)[69](index=69&type=chunk) [Asset and Liability Analysis](index=27&type=section&id=%E8%B5%84%E4%BA%A7%E3%80%81%E8%B4%9F%E5%80%BA%E6%83%85%E5%86%B5%E5%88%86%E6%9E%90) As of 2019-end, total assets reached 43.62 billion Yuan, up 5.89% YoY, with optimized debt structure and a reduced asset-liability ratio Major Changes in Balance Sheet Items | Item Name | Current Period End (Yuan) | Prior Period End (Yuan) | Change (%) | Main Reason | | :--- | :--- | :--- | :--- | :--- | | **Cash and Cash Equivalents** | 4,265,437,976.64 | 3,067,338,382.07 | 39.06 | Increased cash reserves | | **Financial Assets Held for Trading** | 1,821,553,153.54 | 0.00 | Not applicable | Reclassification under new financial instruments standards | | **Construction in Progress** | 2,356,990,285.41 | 1,204,818,693.84 | 95.63 | Construction of environmental protection and energy-saving projects | | **Short-term Borrowings** | 3,436,057,270.37 | 4,897,255,186.15 | -29.84 | Debt structure adjustment | | **Advances from Customers** | 3,580,255,819.98 | 2,357,118,134.61 | 51.89 | Increase in long-term steel product orders | | **Long-term Borrowings** | 845,200,820.84 | 76,000,000.00 | 1,012.11 | New medium and long-term borrowings | | **Bonds Payable** | 1,026,522,045.55 | 0.00 | 100 | Issuance of medium-term notes | - As of the end of the reporting period, the company's total restricted assets amounted to **6.343 billion Yuan**, a significant decrease from **9.182 billion Yuan** at the end of the previous year, with notes receivable and cash and cash equivalents being the primary restricted assets[74](index=74&type=chunk) [Industry Operating Information Analysis](index=31&type=section&id=%E8%A1%8C%E4%B8%9A%E7%BB%8F%E8%90%A5%E6%80%A7%E4%BF%A1%E6%81%AF%E5%88%86%E6%9E%90) In 2019, the company's steel manufacturing and sales were primarily hot-rolled steel, with advanced steel materials showing gross margin resilience Steel Manufacturing and Sales by Finished Product Form (million tons) | Category | Production Volume (Current Year) | Sales Volume (Current Year) | Operating Revenue (10,000 Yuan/Current Year) | Gross Margin (Current Year/%) | Gross Margin (Prior Year/%) | | :--- | :--- | :--- | :--- | :--- | :--- | | **Sections** | 0.3635 | 0.3681 | 164,154.54 | 16.48 | 16.09 | | **Plates and Strips** | 5.5722 | 5.5480 | 2,249,098.07 | 16.62 | 24.82 | | **Other** | 3.9849 | 4.0135 | 1,482,495.18 | 12.96 | 18.30 | Special Steel Product Manufacturing and Sales | Product Name | Sales Volume (tons/Current Year) | Sales Volume (tons/Prior Year) | Operating Revenue (10,000 Yuan/Current Year) | Gross Margin (%/Current Year) | Gross Margin (%/Prior Year) | | :--- | :--- | :--- | :--- | :--- | :--- | | Advanced Steel Materials | 1,372,552.07 | 1,317,272.59 | 683,197.63 | 13.72 | 12.95 | Iron Ore Supply Situation (million tons) | Supply Source | Supply Volume (Current Year) | Supply Volume (Prior Year) | Expenditure (million Yuan/Current Year) | | :--- | :--- | :--- | :--- | | **Self-supplied** | 0.9890 | 0.9104 | 840.48 | | **Domestic Procurement** | 1.9442 | 1.1997 | 1,363.31 | | **Foreign Import** | 13.5643 | 11.6552 | 9,839.72 | [Investment Status Analysis](index=33&type=section&id=%E6%8A%95%E8%B5%84%E7%8A%B6%E5%86%B5%E5%88%86%E6%9E%90) External equity investments totaled 85.70 million Yuan, mainly in new materials and overseas sales, alongside significant non-equity investments in environmental and tech upgrades - During the reporting period, the company's total external equity investments amounted to **85.6959 million Yuan**, primarily including investments in Keller New Materials and Indonesian Lantan Company[82](index=82&type=chunk) - The company's significant non-equity investments primarily focused on environmental protection and technological transformation projects, including resource comprehensive utilization power generation, sintering machine flue gas desulfurization and denitrification, and stockyard enclosure renovation, funded by raised capital and self-financing[84](index=84&type=chunk) [Discussion and Analysis of Company's Future Development](index=37&type=section&id=%E5%85%AC%E5%8F%B8%E6%9C%AA%E6%9D%A5%E5%8F%91%E5%B1%95%E7%9A%84%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) The company aims to become a globally competitive advanced materials intelligent manufacturer, targeting 10.15 million tons of steel products and 48.1 billion Yuan in 2020 revenue - The company's development strategy is to build an industrial chain ecosystem centered on new steel materials, striving to become a globally competitive advanced materials intelligent manufacturer[89](index=89&type=chunk) 2020 Operating Targets | Indicator | Target | | :--- | :--- | | **Pig Iron Output** | 10.50 million tons | | **Crude Steel Output** | 11.60 million tons | | **Steel Product Output** | 10.15 million tons | | **Operating Revenue** | 48.1 billion Yuan | | **Fixed Asset Investment** | 1.95 billion Yuan | - The company faces key risks including economic risks from the COVID-19 pandemic, market risks from high inventory and intensified competition, and increased environmental costs due to ultra-low emission upgrades[97](index=97&type=chunk)[98](index=98&type=chunk)[99](index=99&type=chunk) [Significant Matters](index=40&type=section&id=%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) This section covers the company's profit distribution plan, significant related party transactions, and other major corporate actions [Profit Distribution Plan](index=40&type=section&id=%E5%88%A9%E6%B6%A6%E5%88%86%E9%85%8D%E6%88%96%E8%B5%84%E6%9C%AC%E5%85%AC%E7%A7%AF%E9%87%91%E8%BD%AC%E5%A2%9E%E9%A2%84%E6%A1%88) The 2019 profit distribution plan proposes a 3.00 Yuan cash dividend per 10 shares (incl. tax), representing a high 50.73% payout ratio of net profit - The company's 2019 profit distribution plan proposes a cash dividend of **3.00 Yuan per 10 shares** (including tax), with no capital reserve conversion to share capital; this plan is subject to shareholder approval[104](index=104&type=chunk) Dividend Distribution Plans for the Past Three Years | Dividend Year | Cash Dividend per 10 Shares (Yuan) (incl. tax) | Cash Dividend Amount (Yuan) | Ratio to Net Profit Attributable to Shareholders (%) | | :--- | :--- | :--- | :--- | | **2019** | 3.00 | 1,322,246,537.10 | 50.73 | | **2018** | 3.00 | 1,326,694,997.10 | 33.10 | | **2017** | 0.50 | 220,448,872.85 | 6.89 | [Significant Related Party Transactions](index=59&type=section&id=%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) Routine related party transactions occurred with the parent company and subsidiaries, while a significant non-routine share issuance to acquire two subsidiaries' equity is progressing - Routine related party transactions primarily include sales of water, electricity, steam, and slag to related parties, as well as procurement of iron ore, oxygen, nitrogen, and argon from related parties, with transaction pricing based on market principles[132](index=132&type=chunk)[134](index=134&type=chunk)[137](index=137&type=chunk) - The company plans to issue shares to its controlling shareholder, Nanjing Ganglian, to acquire its **38.72% equity stake** in Nangang Development and **38.72% equity stake** in Jinjiang Furnace Materials, which upon completion will make these companies wholly-owned subsidiaries of the listed company; this matter is currently in progress[140](index=140&type=chunk) [Other Significant Matters](index=70&type=section&id=%E5%85%B6%E4%BB%96%E9%87%8D%E5%A4%A7%E4%BA%8B%E9%A1%B9) The company completed a share repurchase for equity incentives, continued incentive plans, issued medium-term notes, and modified fundraising investment projects - The company completed its share repurchase program, repurchasing a total of **21,980,000 shares** for a total payment of **74,990,042.00 Yuan**, intended for equity incentives[155](index=155&type=chunk) - The company continued to advance multiple equity incentive plans, with **7,151,800 new shares** issued due to exercise during the reporting period, and **21.98 million stock options** newly granted; equity incentive amortization expense was **12.1949 million Yuan**[156](index=156&type=chunk)[157](index=157&type=chunk) - In 2019, the company successfully issued two tranches of medium-term notes, each with a total issuance amount of **500 million Yuan**, a 3-year term, and coupon rates of **5.5%** and **5.35%**, respectively[158](index=158&type=chunk)[159](index=159&type=chunk) - The company modified certain fundraising investment projects, adding environmental protection and intelligent development projects such as sintering machine flue gas denitrification and desulfurization, and industrial internet construction projects[160](index=160&type=chunk) [Share Capital Changes and Shareholder Information](index=81&type=section&id=%E6%99%AE%E9%80%9A%E8%82%A1%E8%82%A1%E4%BB%BD%E5%8F%98%E5%8A%A8%E5%8F%8A%E8%82%A1%E4%B8%9C%E6%83%85%E5%86%B5) This section details changes in the company's share capital and provides an overview of its shareholder structure [Share Capital Changes](index=81&type=section&id=%E6%99%AE%E9%80%9A%E8%82%A1%E8%82%A1%E6%9C%AC%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5) Total share capital increased from 4.422 billion to 4.429 billion shares due to stock option exercise, adding 7,151,800 unrestricted tradable shares - During the reporting period, due to the exercise of equity incentives, the company's total share capital increased by **7,151,800 shares**, reaching **4,429,468,457 shares** at period-end[183](index=183&type=chunk) [Shareholder Information](index=82&type=section&id=%E8%82%A1%E4%B8%9C%E6%83%85%E5%86%B5) As of 2019-end, the company had 123,443 common shareholders, with the controlling shareholder and concerted parties holding 43.27% of shares, some pledged - As of the end of the reporting period, the company had **123,443 shareholders**[188](index=188&type=chunk) Top Ten Shareholders' Shareholding | Shareholder Name | Shares Held at Period End (shares) | Percentage (%) | Share Status | | :--- | :--- | :--- | :--- | | Nanjing Nangang Iron & Steel United Co., Ltd. | 1,795,351,958 | 40.53 | Pledged | | Hong Kong Securities Clearing Company Limited | 178,399,245 | 4.03 | Unrestricted | | Huarong Ruitong Equity Investment Management Co., Ltd. | 134,000,000 | 3.03 | Unrestricted | | Nanjing Iron & Steel United Co., Ltd. | 121,167,491 | 2.74 | Unrestricted | | National Social Security Fund Council 418 Portfolio | 50,095,667 | 1.13 | Unrestricted | | Nanjing Iron & Steel Co., Ltd. - 2015 Employee Stock Ownership Plan | 43,160,000 | 0.97 | Unrestricted | - The company's controlling shareholder is Nanjing Nangang Iron & Steel United Co., Ltd., and the ultimate actual controller is Mr. Guo Guangchang[193](index=193&type=chunk)[195](index=195&type=chunk) [Directors, Supervisors, Senior Management, and Employees](index=90&type=section&id=%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E3%80%81%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E5%92%8C%E5%91%98%E5%B7%A5%E6%83%85%E5%86%B5) This section details shareholding changes and remuneration of directors, supervisors, and senior management, along with employee structure and training initiatives [D&S&SM Shareholding Changes and Remuneration](index=90&type=section&id=%E8%91%A3%E7%9B%91%E9%AB%98%E6%8C%81%E8%82%A1%E5%8F%98%E5%8A%A8%E5%8F%8A%E6%8A%A5%E9%85%AC) Several directors, supervisors, and senior management increased shareholdings due to equity incentive plans, with total remuneration from the company reaching 18.64 million Yuan - During the reporting period, several directors, supervisors, and senior management increased their shareholdings due to the exercise of equity incentives, with President Zhu Ruirong increasing his holdings by **810,000 shares** and Executive Vice President Yao Yongkuan by **645,000 shares**[202](index=202&type=chunk) - As of the end of the reporting period, the total remuneration actually received by all directors, supervisors, and senior management from the company amounted to **18.64 million Yuan**[215](index=215&type=chunk) [Employee Information](index=100&type=section&id=%E5%91%98%E5%B7%A5%E6%83%85%E5%86%B5) As of the reporting period end, the company and its main subsidiaries employed 10,161 staff, with production personnel at 73.5% Employee Professional Structure | Professional Category | Number of Employees | | :--- | :--- | | **Production Personnel** | 7,473 | | **Sales Personnel** | 162 | | **Technical Personnel** | 821 | | **Financial Personnel** | 104 | | **Administrative Personnel** | 1,601 | | **Total** | 10,161 | - The company implements a remuneration system linked to efficiency and job contribution, and offers diversified incentive measures for core talents, including equity incentives, annual salaries, and allowances[219](index=219&type=chunk) [Corporate Governance](index=102&type=section&id=%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86) This section provides an overview of the company's corporate governance structure and its effective operation [Corporate Governance Overview](index=102&type=section&id=%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) The company has a sound corporate governance structure with clear responsibilities for shareholders, board, supervisors, and management, ensuring scientific decision-making and effective supervision - The company has established a sound corporate governance structure, with clear division of responsibilities among the General Meeting of Shareholders, Board of Directors, Supervisory Committee, and management, operating strictly according to decision-making authority and procedures[223](index=223&type=chunk) - During the reporting period, the four special committees under the Board of Directors—Strategy, Audit, Remuneration and Appraisal, and Nomination—actively fulfilled their duties, providing recommendations for the Board's scientific decision-making without raising any dissenting opinions[229](index=229&type=chunk) - The company disclosed its 2019 Internal Control Evaluation Report, and Tianheng Certified Public Accountants issued a standard unqualified internal control audit report[232](index=232&type=chunk)[233](index=233&type=chunk) [Financial Report and Audit Opinion](index=106&type=section&id=%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A%E4%B8%8E%E5%AE%A1%E8%AE%A1%E6%84%8F%E8%A7%81) This section presents the audit opinion on the financial statements and details significant accounting policy changes [Audit Opinion](index=106&type=section&id=%E5%AE%A1%E8%AE%A1%E6%84%8F%E8%A7%81) Tianheng Certified Public Accountants issued a standard unqualified audit opinion on the company's 2019 financial statements, affirming their fair presentation - The auditing firm, Tianheng Certified Public Accountants, issued a **standard unqualified audit opinion** on the company's 2019 financial statements[236](index=236&type=chunk) - A key audit matter for this period's financial statements was "Inventory Impairment Provision"; as of the end of 2019, the company's inventory balance was **6.266 billion Yuan**, with an inventory impairment provision balance of **385 million Yuan**[238](index=238&type=chunk)[239](index=239&type=chunk) [Significant Accounting Policy Changes](index=143&type=section&id=%E9%87%8D%E8%A6%81%E4%BC%9A%E8%AE%A1%E6%94%BF%E7%AD%96%E5%8F%98%E6%9B%B4) Effective January 1, 2019, the company adopted revised new financial instruments standards, reclassifying financial assets and retrospectively adjusting opening balances - The company adopted the new financial instruments standards effective **January 1, 2019**, and made corresponding adjustments to the financial statement format; this accounting policy change only adjusted opening retained earnings or other comprehensive income, without retrospective adjustment of comparative statements[332](index=332&type=chunk) Impact of New Financial Instruments Standards on Opening Financial Position | Item | Before Adjustment (Yuan) | After Adjustment (Yuan) | Adjustment Amount (Yuan) | | :--- | :--- | :--- | :--- | | **Financial Assets Held for Trading** | 0 | 1,404,850,999.41 | 1,404,850,999.41 | | **Financial Assets Measured at Fair Value Through Profit or Loss** | 172,096,879.41 | 0 | -172,096,879.41 | | **Notes Receivable** | 5,595,253,891.07 | 0 | -5,595,253,891.07 | | **Receivables Financing** | 0 | 5,595,253,891.07 | 5,595,253,891.07 | | **Available-for-sale Financial Assets** | 445,331,691.00 | 0 | -445,331,691.00 | | **Other Equity Instrument Investments** | 0 | 353,404,809.36 | 353,404,809.36 | | **Other Comprehensive Income** | 16,840,501.20 | 35,464,102.47 | 18,623,601.27 | | **Retained Earnings** | 8,055,774,551.02 | 8,125,856,416.57 | 70,081,865.55 |