山东地矿股份有限公司 2014 年第一季度报告正文 证券代码：000409 证券简称：山东地矿 公告编号：2014-027 山东地矿股份有限公司 2014 年第一季度报告正文 1 山东地矿股份有限公司 2014 年第一季度报告正文 第一节 重要提示 公司董事会、监事会及董事、监事、高级管理人员保证季度报告内容的真实、准确、完整，不存在虚 假记载、误导性陈述或者重大遗漏，并承担个别和连带的法律责任。 除下列董事外，其他董事亲自出席了审议本次季报的董事会会议 | 未亲自出席董事姓名 | 未亲自出席董事职务 | 未亲自出席会议原因 | 被委托人姓名 | | --- | --- | --- | --- | | 侯新文 | 董事 | 因公出差 | 郭长洲 | | 崔书学 | 董事 | 因公出差 | 胡向东 | 公司负责人胡向东、主管会计工作负责人李清华及会计机构负责人(会计主管人员)薛希凤声明：保证 季度报告中财务报表的真实、准确、完整。 2 山东地矿股份有限公司 2014 年第一季度报告正文 第二节 主要财务数据及股东变化 一、主要会计数据和财务指标 公司是否因会计政策变更及会计差错更正等追溯调整或重述以前年度会计数 ...

Section 1: Important Notices, Table of Contents, and Definitions [Important Notices](index=2&type=section&id=%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA) The board guarantees the report's authenticity and assumes legal liability, with no dividend distribution planned - The company's Board of Directors, Board of Supervisors, and senior management guarantee the truthfulness, accuracy, and completeness of the annual report's content and assume legal responsibility[5](index=5&type=chunk) - The company plans **not to distribute cash dividends**, issue bonus shares, or convert capital reserves into share capital[7](index=7&type=chunk) - Company head Hu Xiangdong, chief accounting officer Li Qinghua, and head of the accounting department Xue Xifeng declare that the financial reports in the annual report are true, accurate, and complete[7](index=7&type=chunk) [Table of Contents](index=3&type=section&id=%E7%9B%AE%E5%BD%95) This section lists the report's full structure, covering eleven main chapters and their starting page numbers - The report's table of contents includes eleven sections, covering core information on company operations, finance, and governance[10](index=10&type=chunk) [Definitions](index=4&type=section&id=%E9%87%8A%E4%B9%89) This section defines key terms used in the report to ensure clear understanding - "Shandong Land & Mining" refers to Shandong Land & Mining Co, Ltd, with stock code 000409[12](index=12&type=chunk) - "Major Asset Restructuring" refers to the asset sale and issuance of shares to purchase assets and related party transactions disclosed by the company on September 26, 2012[12](index=12&type=chunk) [Major Risk Warning](index=5&type=section&id=%E9%87%8D%E5%A4%A7%E9%A3%8E%E9%99%A9%E6%8F%90%E7%A4%BA) The company highlights potential risks in its main business, including price fluctuations and safety - The company's main business is ferrous metal mining and processing, which may face risks such as price fluctuations, industry cyclicality, and production safety[15](index=15&type=chunk) - The company has described potential risks in the "Outlook for Future Development" section of the "Board of Directors' Report" in Section Four[15](index=15&type=chunk) Section 2: Company Profile [Company Information](index=6&type=section&id=%E5%85%AC%E5%8F%B8%E4%BF%A1%E6%81%AF) This section provides basic information about Shandong Land & Mining Co, Ltd - The company's stock short name is "Shandong Land & Mining", stock code is 000409, and it is listed on the Shenzhen Stock Exchange[18](index=18&type=chunk) - The company's legal representative is Hu Xiangdong, and its registered address is Building 5, 750 Xinyu Road, High-tech Zone, Jinan City, Shandong Province[18](index=18&type=chunk) [Contact Persons and Methods](index=6&type=section&id=%E8%81%94%E7%B3%BB%E4%BA%BA%E5%92%8C%E8%81%94%E7%B3%BB%E6%96%B9%E5%BC%8F) This section lists contact details for the Board Secretary and Securities Affairs Representative - The Secretary of the Board is Li Yonggang, and the Securities Affairs Representative is Wang Yingnan, with contact numbers 0531-88550409 and 0531-88195618[19](index=19&type=chunk) [Information Disclosure and Document Location](index=6&type=section&id=%E4%BF%A1%E6%81%AF%E6%8A%AB%E9%B2%B2%E5%8F%8A%E5%A4%87%E7%BD%AE%E5%9C%B0%E7%82%B9) The company specifies designated media for information disclosure and the location for report inspection - The company designates "Securities Daily", "Securities Times", "Shanghai Securities News", and "China Securities Journal" as its information disclosure newspapers[20](index=20&type=chunk) - The CSRC-designated website for publishing the annual report is Cninfo (www.cninfo.com.cn)[20](index=20&type=chunk) [Registration Changes](index=7&type=section&id=%E6%B3%A8%E5%86%8C%E5%8F%98%E6%9B%B4%E6%83%85%E5%86%B5) The company's main business and controlling shareholder have undergone several changes since its initial registration - On January 28, 2013, the company completed a major asset restructuring, changing its main business to ore mining, processing, and mineral product sales[21](index=21&type=chunk) - On January 28, 2013, Shandong Ludi Investment Holding Co, Ltd became the company's controlling shareholder, with the Shandong Provincial Bureau of Geology and Mineral Exploration and Development as the actual controller[23](index=23&type=chunk) - On December 13, 2013, the controlling shareholder Shandong Ludi Investment Holding Co, Ltd changed its name to Shandong Land & Mining Group Co, Ltd, with its shareholding ratio remaining unchanged[23](index=23&type=chunk) [Other Relevant Information](index=8&type=section&id=%E5%85%B6%E4%BB%96%E6%9C%89%E5%85%B3%E8%B5%84%E6%96%99) The company discloses its appointed accounting firm and financial advisor for the reporting period - The company has appointed ShineWing Certified Public Accountants (Special General Partnership) as its accounting firm, with signing accountants Lu Qing and Liu Yuxian[24](index=24&type=chunk) - The company has appointed Qilu Securities Co, Ltd as its financial advisor, with a continuous supervision period from December 7, 2012, to December 31, 2015[24](index=24&type=chunk) Section 3: Summary of Accounting Data and Financial Indicators [Key Accounting Data and Financial Indicators](index=9&type=section&id=%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 2013, revenue and net profit grew significantly, while operating cash flow declined Key Accounting Data and Financial Indicators (2011-2013) | Indicator | 2013 | 2012 | YoY Change (%) | 2011 | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue (Yuan) | 409,035,652.80 | 299,049,612.99 | 36.78% | 288,690,758.71 | | Net Profit Attributable to Shareholders (Yuan) | 126,774,908.65 | 80,584,201.22 | 57.32% | 106,395,433.05 | | Net Profit Attributable to Shareholders (Excluding Non-recurring Items) (Yuan) | 110,759,467.99 | 72,545,572.68 | 52.68% | 88,607,678.58 | | Net Cash Flow from Operating Activities (Yuan) | 44,629,972.25 | 72,402,908.33 | -38.36% | 124,226,433.96 | | Basic Earnings Per Share (Yuan/Share) | 0.27 | 0.27 | 0% | 0.35 | | Diluted Earnings Per Share (Yuan/Share) | 0.27 | 0.27 | 0% | 0.35 | | Weighted Average Return on Equity (%) | 12.68% | 8.55% | 4.13% | 12.71% | | Total Assets (Yuan) | 1,776,913,859.08 | 1,198,423,425.67 | 48.27% | 1,212,033,047.75 | | Net Assets Attributable to Shareholders (Yuan) | 1,063,469,846.84 | 941,975,625.57 | 12.9% | 836,860,765.06 | [Differences in Accounting Data under Domestic and Foreign Accounting Standards](index=9&type=section&id=%E5%A2%83%E5%86%85%E5%A4%96%E4%BC%9A%E8%AE%A1%E5%87%86%E5%88%99%E4%B8%8B%E4%BC%9A%E8%AE%A1%E6%95%B0%E6%8D%AE%E5%B7%AE%E5%BC%82) The company states there are no differences in its financial data under domestic and international accounting standards Net Profit and Net Assets Attributable to Shareholders (under Chinese Accounting Standards) | Indicator | Current Period | Prior Period | Period-End | Period-Beginning | | :--- | :--- | :--- | :--- | :--- | | Net Profit Attributable to Shareholders | 126,774,908.65 | 80,584,201.22 | - | - | | Net Assets Attributable to Shareholders | - | - | 1,063,469,846.84 | 941,975,625.57 | - The company states there are **no differences** in accounting data under domestic and foreign accounting standards[32](index=32&type=chunk) [Non-recurring Profit and Loss Items and Amounts](index=10&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%E5%8F%8A%E9%87%91%E9%A2%9D) Non-recurring profit and loss totaled 16.02 million Yuan in 2013, mainly from asset disposals and government subsidies Non-recurring Profit and Loss Items and Amounts (2011-2013) | Item | 2013 Amount | 2012 Amount | 2011 Amount | | :--- | :--- | :--- | :--- | | Gains/Losses from Disposal of Non-current Assets | 12,695,887.16 | -769,715.54 | 27,363.37 | | Government Grants Recognized in Current Profit or Loss | 1,051,000.00 | 150,000.00 | 100,000.00 | | Gains/Losses from Debt Restructuring | -650,988.07 | - | - | | Fair Value Change Gains/Losses and Investment Income from Disposal of Financial Assets | 172,458.57 | - | 18,074,510.98 | | Gains/Losses from Entrusted Loans | 3,577,777.78 | 8,290,707.77 | -411,841.81 | | Other Non-operating Income and Expenses | -859,023.68 | 133,829.37 | - | | Less: Income Tax Impact | -28,328.90 | -182,685.94 | 2,278.07 | | Total | 16,015,440.66 | 8,038,628.54 | 17,787,754.47 | Section 4: Board of Directors' Report [Overview](index=11&type=section&id=%E6%A6%82%E8%BF%B0) In 2013, the company completed its major asset restructuring, achieved profit targets, and expanded through acquisitions - In 2013, the company achieved sales revenue of **409.04 million Yuan**, net profit of **127.32 million Yuan**, and EPS of **0.27 Yuan/share**, meeting the profit commitment from the major asset restructuring[36](index=36&type=chunk) - The company successfully acquired a **90% stake in Wuhu Taiping Mining** and, in January 2014, a **70% stake in Shandong Shengxin Mining**, further developing its iron ore mining and processing business[37](index=37&type=chunk) - The company's name was officially changed to "Shandong Land & Mining Co, Ltd", the stock short name changed from "Taifu Industry" to "Shandong Land & Mining", and the registered address was moved to Jinan, Shandong Province[37](index=37&type=chunk) - In November 2013, the company established Shenzhen Taifu Xinhuida Equity Investment Fund Management Co, Ltd in Qianhai, Shenzhen, with a registered capital of **50 million Yuan**, of which the company holds a **60% stake**, to support capital operations[40](index=40&type=chunk) [Analysis of Main Business Operations](index=12&type=section&id=%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%88%86%E6%9E%90) The company's main business, ferrous metal mining, saw significant growth in revenue and profitability Overview The company's main business is iron ore mining and sales, with revenue growing 36.78% year-over-year - The company's main business revenue was **409.04 million Yuan**, a year-over-year increase of **36.78%**[42](index=42&type=chunk) - Iron concentrate production reached **429,497 tons**, up **39.84%** YoY; sales reached **434,257 tons**, up **45%** YoY[43](index=43&type=chunk) Revenue Revenue was primarily driven by iron concentrate sales from subsidiaries, with high customer concentration - The company's operating revenue was **409.04 million Yuan**, mainly from iron concentrate sales by its subsidiaries[44](index=44&type=chunk) Ferrous Metal Mining Production, Sales, and Inventory (2013 vs 2012) | Item | 2013 | 2012 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Sales Volume (tons) | 434,257 | 299,484 | 45% | | Production Volume (tons) | 429,497 | 307,140 | 39.84% | | Inventory Volume (tons) | 7,150 | 11,910 | -39.97% | - The total sales amount to the **top five customers** accounted for **89%** of the annual sales total[45](index=45&type=chunk) Cost Operating costs were dominated by the ferrous metal mining sector, with moderate supplier concentration Operating Cost Composition (2013 vs 2012) | Industry Classification | Item | 2013 Amount | % of Operating Cost | 2012 Amount | % of Operating Cost | YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Ferrous Metal Mining | Iron Ore | 153,660,543.08 | 99.52% | 108,503,821.67 | 99.99% | -0.47% | | Product Classification | Iron Concentrate | 153,660,543.08 | 99.52% | 108,503,821.67 | 99.99% | -0.47% | - The total purchase amount from the **top five suppliers** accounted for **38.67%** of the annual purchase total[49](index=49&type=chunk) Expenses Financial expenses surged due to increased bank borrowings, and income tax expenses rose with profits Key Expense Changes (2013 vs 2012) | Item | 2013 | 2012 | Change (%) | Reason | | :--- | :--- | :--- | :--- | :--- | | Selling Expenses | 17,846,448.79 | 17,927,109.34 | -0.45% | - | | Administrative Expenses | 61,211,370.81 | 56,082,334.48 | 9.15% | - | | Financial Expenses | 3,879,663.89 | -2,440,018.47 | 259.00% | Significant increase in bank borrowings led to a corresponding increase in financial expenses | | Income Tax Expense | 42,747,861.43 | 30,025,385.70 | 42.37% | Increase in total profit led to a corresponding increase in income tax expense | R&D Expenditure The company had no R&D projects during the reporting period - The company had **no R&D projects** during the reporting period[52](index=52&type=chunk) Cash Flow Operating cash flow decreased, while financing cash flow increased significantly due to new investments and loans Key Cash Flow Item Changes (2013 vs 2012) | Item | 2013 | 2012 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Subtotal of Cash Inflows from Operating Activities | 325,979,039.19 | 366,894,059.44 | -11.15% | | Subtotal of Cash Outflows from Operating Activities | 281,349,066.94 | 294,491,151.11 | -4.46% | | Net Cash Flow from Operating Activities | 44,629,972.25 | 72,402,908.33 | -38.36% | | Subtotal of Cash Inflows from Investing Activities | 118,245,124.63 | 311,037,452.89 | -61.98% | | Subtotal of Cash Outflows from Investing Activities | 295,062,220.21 | 418,221,731.14 | -29.45% | | Net Cash Flow from Investing Activities | -176,817,095.58 | -107,184,278.25 | -64.97% | | Subtotal of Cash Inflows from Financing Activities | 321,200,000.00 | - | 100% | | Subtotal of Cash Outflows from Financing Activities | 172,377,934.38 | 117,818,426.48 | 46.31% | | Net Cash Flow from Financing Activities | 148,822,065.62 | -117,818,426.48 | 226.31% | | Net Increase in Cash and Cash Equivalents | 16,634,942.29 | -152,599,796.40 | 110.9% | - Net cash flow from operating activities **decreased by 38.36%**, mainly due to extended credit terms for sales and an increased proportion of acceptance bills[56](index=56&type=chunk) - Cash inflows from investing activities **decreased by 61.98%**, primarily because 300 million Yuan in trust funds were recovered in 2012, with fewer trust activities in 2013[56](index=56&type=chunk) - Cash inflows from financing activities **increased by 100%**, mainly due to a 20 million Yuan investment from minority shareholders in a new subsidiary and a 300 million Yuan increase in bank loans[55](index=55&type=chunk)[56](index=56&type=chunk) [Composition of Main Business](index=16&type=section&id=%E4%B8%BB%E8%90%A5%E4%B8%9A%E6%9E%84%E6%88%90%E6%83%85%E5%86%B5) The ferrous metal mining business contributed the majority of revenue, with significant growth in the Shanxi Taiyuan region Main Business Composition (2013) | Category | Operating Revenue (Yuan) | Operating Cost (Yuan) | Gross Margin (%) | Revenue YoY Change (%) | Cost YoY Change (%) | Gross Margin YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Ferrous Metal Mining | 400,781,987.17 | 153,660,543.08 | 61.66% | 39.92% | 41.62% | -0.46% | | Iron Concentrate | 400,781,987.17 | 153,660,543.08 | 61.66% | 39.92% | 41.62% | -0.46% | | Anhui Wuhu, Xuzhou | 308,202,136.02 | 101,018,079.22 | 67.22% | 17.37% | 7.07% | 3.15% | | Shanxi Taiyuan Area | 92,579,851.15 | 52,642,463.86 | 43.14% | 288.29% | 271.96% | 2.5% | [Analysis of Assets and Liabilities](index=17&type=section&id=%E8%B5%84%E4%BA%A7%E3%80%81%E8%B4%9F%E5%80%BA%E7%8A%B6%E5%86%B5%E5%88%86%E6%9E%90) Total assets grew by 48.27%, driven by increases in fixed assets and construction in progress, while liabilities rose due to new borrowings Significant Changes in Asset Items Total assets grew significantly, with fixed assets and construction in progress increasing their share Significant Changes in Asset Items (Year-end 2013 vs 2012) | Item | 2013 Year-End Amount | % of Total Assets | 2012 Year-End Amount | % of Total Assets | Change in Proportion (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 208,640,033.68 | 11.74% | 192,005,091.39 | 16.02% | -4.28% | | Accounts Receivable | 89,117,201.19 | 5.02% | 48,701,793.87 | 4.06% | 0.96% | | Inventory | 13,735,374.73 | 0.77% | 15,207,275.47 | 1.27% | -0.5% | | Long-term Equity Investment | - | - | 1,205,536.95 | 0.1% | -0.1% | | Fixed Assets | 490,182,931.43 | 27.59% | 307,992,183.67 | 25.7% | 1.89% | | Construction in Progress | 196,778,198.08 | 11.07% | 75,476,182.93 | 6.3% | 4.77% | Significant Changes in Liability Items Short-term and long-term borrowings increased substantially, raising the company's debt levels Significant Changes in Liability Items (Year-end 2013 vs 2012) | Item | 2013 Amount | % of Total Assets | 2012 Amount | % of Total Assets | Change in Proportion (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | Short-term Borrowings | 270,000,000.00 | 15.19% | - | - | 15.19% | | Long-term Borrowings | 100,090,000.00 | 5.63% | 90,000.00 | 0.01% | 5.62% | Assets and Liabilities Measured at Fair Value The company had no assets or liabilities measured at fair value and no major changes in asset measurement attributes - There were **no significant changes** in the measurement attributes of the company's main assets during the reporting period[65](index=65&type=chunk) [Core Competitiveness Analysis](index=18&type=section&id=%E6%A0%B8%E5%BF%83%E7%AB%9E%E4%BA%89%E5%8A%9B%E5%88%86%E6%9E%90) The company's core strengths lie in its integrated exploration-mining expertise, resource advantages, and capital market platform - After restructuring, the company transformed into a mineral investment and development enterprise with strong profitability and future growth potential[66](index=66&type=chunk) - The company has enhanced its professional exploration techniques, accumulated extensive market-oriented operational experience, and possesses a talent advantage in geological exploration and mining[66](index=66&type=chunk) - The company has established long-term collaborations with institutions like Northeastern University, Changsha Mining Research Institute, and Shandong University of Science and Technology, ensuring technical support[67](index=67&type=chunk) - Leveraging the Shandong Provincial Bureau of Geology and Mineral Resources, the company holds a strong resource advantage within the national geological and mineral system[67](index=67&type=chunk) - The company expands its operational scale and enhances risk resilience through mine acquisitions and has established a fund management company to support capital operations[67](index=67&type=chunk) [Investment Analysis](index=18&type=section&id=%E6%8A%95%E8%B5%84%E7%8A%B6%E5%86%B5%E5%88%86%E6%9E%90) The company made no external equity investments but acquired two mining companies and established a fund management subsidiary External Equity Investments The company made no external equity investments during the reporting period - The company's external investment amount during the reporting period was **0 Yuan**[68](index=68&type=chunk) - The company **did not hold equity** in financial enterprises or securities investments[69](index=69&type=chunk)[70](index=70&type=chunk) Entrusted Wealth Management, Derivative Investments, and Entrusted Loans The company did not engage in entrusted wealth management, derivative investments, or entrusted loans - The company had **no entrusted wealth management** activities during the reporting period[72](index=72&type=chunk) - The company had **no derivative investments** during the reporting period[74](index=74&type=chunk) - The company had **no entrusted loans** during the reporting period[77](index=77&type=chunk) Use of Raised Funds The company had no raised funds to utilize during the reporting period - The total amount of raised funds was **0 million Yuan**[79](index=79&type=chunk) - There were **no committed projects** for raised funds or investment of over-raised funds[81](index=81&type=chunk) - There were **no changes** in projects funded by raised funds[83](index=83&type=chunk) Analysis of Major Subsidiaries and Affiliates The company's main subsidiaries are in the mining and investment sectors, with two new entities added in 2013 Key Financial Data of Major Subsidiaries (2013) | Company Name | Registered Capital | Total Assets (Yuan) | Net Assets (Yuan) | Operating Revenue (Yuan) | Net Profit (Yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | | Shandong Ludi Mining Investment Co, Ltd | 95.88 million Yuan | 677,366,247.87 | 657,800,755.34 | 3,577,777.78 | 740,534.16 | | Huaibei Xulou Mining Co, Ltd | 80 million Yuan | 654,965,563.11 | 351,956,059.89 | 294,309,605.74 | 119,103,269.97 | | Loufan County Ludi Mining Co, Ltd | 70 million Yuan | 298,072,952.36 | 93,190,095.64 | 50,162,541.68 | 9,902,424.84 | | Wuhu Taiping Mining Co, Ltd | 10 million Yuan | 271,039,705.04 | 16,081,168.53 | 17,958,173.60 | 7,004,190.47 | | Shenzhen Taifu Xinhuida Equity Investment Fund Management Co, Ltd | 50 million Yuan | 49,908,943.19 | 49,853,071.79 | 0.00 | -146,928.21 | - In October 2013, the company acquired a **90% stake in Wuhu Taiping Mining Co, Ltd** and established Shenzhen Taifu Xinhuida Equity Investment Fund Management Co, Ltd on October 24, both of which were included in the consolidated financial statements[86](index=86&type=chunk) - On December 24, 2013, the company transferred its **33.33% equity stake** in Changchun Chunhua Public Facilities Co, Ltd and no longer holds any equity in it[86](index=86&type=chunk) Major Projects Invested with Non-raised Funds The company's major non-raised fund project is the Phase II expansion of Huaibei Xulou Mining, which is 51.01% complete Major Projects Invested with Non-raised Funds | Project Name | Planned Total Investment (million Yuan) | Investment this Period (million Yuan) | Cumulative Actual Investment to Date (million Yuan) | Project Progress | | :--- | :--- | :--- | :--- | :--- | | Huaibei Xulou Mining Co, Ltd Phase II Project | 260.00 | 59.42 | 132.62 | 51.01% | [Forecast of Operating Performance for Q1 2014](index=23&type=section&id=2014%20%E5%B9%B4%201-3%20%E6%9C%88%E7%BB%8F%E8%90%A5%E4%B8%9A%E7%BB%A9%E7%9A%84%E9%A2%84%E8%AE%A1) The company has not issued a warning or explanation for any expected loss or significant change in its Q1 2014 operating performance - The company has **not issued a warning** or explanation for any expected loss or significant change in its operating performance for January-March 2014[91](index=91&type=chunk) [Information on Special Purpose Entities Controlled by the Company](index=23&type=section&id=%E5%85%AC%E5%8F%B8%E6%8E%A7%E5%88%B6%E7%9A%84%E7%89%B9%E6%AE%8A%E7%9B%AE%E7%9A%84%E4%B8%BB%E4%BD%93%E6%83%85%E5%86%B5) The company did not control any special purpose entities during the reporting period - The company **did not control any special purpose entities** during the reporting period[91](index=91&type=chunk) [Outlook for Future Development](index=23&type=section&id=%E5%85%AC%E5%8F%B8%E6%9C%AA%E6%9D%A5%E5%8F%91%E5%B1%95%E7%9A%84%E5%B1%95%E6%9C%9B) The company anticipates a challenging domestic iron ore market but expects stable prices due to infrastructure investment Industry and Company Development Trends The company expects a challenging domestic iron ore market but stable prices overall due to infrastructure-driven demand - The future domestic iron ore market is expected to be **challenging**, influenced by capacity adjustments and increased international supply[92](index=92&type=chunk) - Demand for steel will be driven by rural development, high-speed rail construction, affordable housing projects, and urban subways, with iron ore prices expected to remain **generally stable**[92](index=92&type=chunk) - The deepening reform of geological exploration units in China, combining exploration advantages with capital market funding, provides a good opportunity for the company's development[93](index=93&type=chunk) Company's Future Development Strategy The company's strategy is to leverage its resource advantages and financing platform to become a large-scale mining enterprise - The company's development strategy is to leverage the advantages of the Shandong Provincial Bureau of Geology and Mineral Resources, utilize its financing capabilities, and conduct effective capital operations[93](index=93&type=chunk) - Based on its iron ore development, the company will actively acquire and develop precious metal mines (gold, silver) and multi-metal mines (lead, zinc) to build a large-scale, high-efficiency mining enterprise[93](index=93&type=chunk) 2014 Work Plan The 2014 plan focuses on production, M&A, and capital operations under an "one body, two wings" strategy - In 2014, the company will implement the **"one body, two wings"** development policy: focusing on production mines as the main body, while strengthening project M&A and capital operations[93](index=93&type=chunk) - Key measures include strengthening dispatch and standardized management, launching a "Management Efficiency Year" campaign, selectively pursuing project M&A, diversifying financing channels, enhancing talent development, reinforcing safety management, and solidifying the technical foundation[94](index=94&type=chunk)[95](index=95&type=chunk)[96](index=96&type=chunk) Potential Risks The company faces risks from macroeconomic fluctuations, iron concentrate price volatility, and inherent production safety issues - The company's main business is significantly affected by macroeconomic cyclical fluctuations and policies, posing **macroeconomic and policy risks**[96](index=96&type=chunk) - **Volatility in iron concentrate prices** will have a significant impact on the company's ability to achieve its profit commitments[96](index=96&type=chunk) - As a resource extraction enterprise, the company faces inherent **production safety risks** such as natural disasters, equipment failure, and human error[96](index=96&type=chunk) [Board and Supervisory Committee's Statement on the "Non-standard Audit Report"](index=24&type=section&id=%E8%91%A3%E4%BA%8B%E4%BC%9A%E3%80%81%E7%9B%91%E4%BA%8B%E4%BC%9A%E5%AF%B9%E4%BC%9A%E8%AE%A1%E5%B8%88%E4%BA%8B%E5%8A%A1%E6%89%80%E6%9C%AC%E6%8A%A5%E5%91%8A%E6%9C%9F%22%E9%9D%9E%E6%A0%87%E5%87%86%E5%AE%A1%E8%AE%A1%E6%8A%A5%E5%91%8A%22%E7%9A%84%E8%AF%B4%E6%98%8E) The accounting firm issued a standard unqualified audit report, with which the Board and Supervisory Committee concur - ShineWing Certified Public Accountants issued a **standard unqualified audit report** on the company's 2013 financial statements[97](index=97&type=chunk) [Explanation of Changes in Accounting Policies, Estimates, and Methods Compared to the Previous Year's Financial Report](index=24&type=section&id=%E4%B8%8E%E4%B8%8A%E5%B9%B4%E5%BA%A6%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A%E7%9B%B8%E6%AF%94%EF%BC%8C%E4%BC%9A%E8%AE%A1%E6%94%BF%E7%AD%96%E3%80%81%E4%BC%9A%E8%AE%A1%E4%BC%B0%E8%AE%A1%E5%92%8C%E6%A0%B8%E7%AE%97%E6%96%B9%E6%B3%95%E5%8F%91%E7%94%9F%E5%8F%98%E5%8C%96%E7%9A%84%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) The company's accounting policies, estimates, and methods remained unchanged during the reporting period - During the reporting period, there were **no changes** in the company's accounting policies, accounting estimates, or calculation methods[98](index=98&type=chunk) [Explanation of Major Accounting Error Corrections Requiring Retrospective Restatement](index=24&type=section&id=%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%8F%91%E7%94%9F%E9%87%8D%E5%A4%A7%E4%BC%9A%E8%AE%A1%E5%B7%AE%E9%94%99%E6%9B%B4%E6%AD%A3%E9%9C%80%E8%BF%BD%E6%BA%AF%E9%87%8D%E8%BF%B0%E7%9A%84%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) The company had no major accounting error corrections requiring retrospective restatement during the reporting period - During the reporting period, the company had **no major accounting error corrections** requiring retrospective restatement[98](index=98&type=chunk) [Explanation of Changes in the Scope of Consolidation Compared to the Previous Year's Financial Report](index=25&type=section&id=%E4%B8%8E%E4%B8%8A%E5%B9%B4%E5%BA%A6%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A%E7%9B%B8%E6%AF%94%EF%BC%8C%E5%90%88%E5%B9%B6%E6%8A%A5%E8%A1%A8%E8%8C%83%E5%9B%B4%E5%8F%91%E7%94%9F%E5%8F%98%E5%8C%96%E7%9A%84%E6%83%85%E5%86%B5%E8%AF%B4%E6%98%8E) Two new companies were included in the consolidation scope this year through acquisition and establishment Companies Newly Included in Consolidation Scope This Year | Company Name | Reason for Inclusion | Shareholding (%) | Year-End Net Assets (million Yuan) | Net Profit This Year (million Yuan) | | :--- | :--- | :--- | :--- | :--- | | Wuhu Taiping Mining Co, Ltd | Acquisition | 90.00 | 16.08 | 7.00 | | Shenzhen Taifu Xinhuida Equity Investment Fund Management Co, Ltd | New Establishment | 60.00 | 49.85 | -0.15 | [Profit Distribution and Dividend Payout Situation](index=25&type=section&id=%E5%85%AC%E5%8F%B8%E5%88%A9%E6%B6%A6%E5%88%86%E9%85%8D%E5%8F%8A%E5%88%86%E7%BA%A2%E6%B4%BE%E6%81%AF%E6%83%85%E5%86%B5) Due to negative accumulated distributable profits, the company has not distributed profits for the past three years - The company formulates its annual cash dividend policy in strict accordance with the Articles of Association and relevant regulations, emphasizing returns to investors[100](index=100&type=chunk) - The company revised its profit distribution policy and decision-making procedures in the Articles of Association in July 2012[100](index=100&type=chunk) - As the net profits realized in 2011, 2012, and 2013 were insufficient to cover previous years' losses, the company **did not distribute profits** or convert capital reserves into share capital for the past three years[102](index=102&type=chunk) Cash Dividend Payouts in the Last Three Years | Dividend Year | Cash Dividend Amount (Tax Included) (Yuan) | Net Profit Attributable to Shareholders in Consolidated Statements (Yuan) | Ratio to Net Profit Attributable to Shareholders in Consolidated Statements (%) | | :--- | :--- | :--- | :--- | | 2013 | 0.00 | 126,774,908.65 | 0% | | 2012 | 0.00 | 80,584,201.22 | 0% | | 2011 | 0.00 | 106,395,433.05 | 0% | [Profit Distribution and Capital Reserve Conversion Plan for the Current Reporting Period](index=26&type=section&id=%E6%9C%AC%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%88%A9%E6%B6%A6%E5%88%86%E9%85%8D%E5%8F%8A%E8%B5%84%E6%9C%AC%E5%85%AC%E7%A7%AF%E9%87%91%E8%BD%AC%E5%A2%9E%E8%82%A1%E6%9C%AC%E9%A2%84%E6%A1%88) The company proposes no profit distribution as the parent company's unappropriated profits are negative - Although the company's consolidated financial statements show a profit for the reporting period, the parent company's unappropriated profits for 2013 are **negative**, making it ineligible for dividend distribution[105](index=105&type=chunk) - The company proposes **not to distribute profits** and not to convert capital reserves into share capital[105](index=105&type=chunk) - Independent directors opined that since the company's unappropriated profits for 2013 are negative, it does not meet the conditions for dividend distribution, and they agree with the board's 2013 profit distribution plan[105](index=105&type=chunk) [Social Responsibility](index=26&type=section&id=%E7%A4%BE%E4%BC%9A%E8%B4%A3%E4%BB%BB%E6%83%85%E5%86%B5) The company is committed to social responsibility and is not classified as a heavily polluting industry - The company values its social responsibility, striving to balance economic benefits with social benefits, short-term interests with long-term interests, and its own development with societal development[106](index=106&type=chunk) - The company and its subsidiaries are **not classified as heavily polluting industries** by national environmental protection authorities[107](index=107&type=chunk) - During the reporting period, the company and its subsidiaries had **no other major social safety issues** or administrative penalties[107](index=107&type=chunk) [Record of Investor Relations Activities](index=26&type=section&id=%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E6%8E%A5%E5%BE%85%E8%B0%83%E7%A0%94%E3%80%81%E6%B2%9F%E9%80%9A%E3%80%81%E9%87%87%E8%AE%BF%E7%AD%89%E6%B4%BB%E5%8A%A8%E7%99%BB%E8%AE%B0%E8%A1%A8) The company engaged with individual investors through various channels to discuss corporate developments - The company received individual investors multiple times during the reporting period through phone calls and on-site visits[107](index=107&type=chunk)[108](index=108&type=chunk) - Communication topics covered a wide range, including restructuring progress, company development, asset acquisitions, shareholder meetings, and company name change[107](index=107&type=chunk)[108](index=108&type=chunk) - **No materials were provided** to investors during these activities[107](index=107&type=chunk)[108](index=108&type=chunk) Section 5: Important Matters [Major Litigation and Arbitration](index=28&type=section&id=%E9%87%8D%E5%A4%A7%E8%AF%89%E8%AE%BC%E4%BB%B2%E8%A3%81%E4%BA%8B%E9%A1%B9) The company had no major litigation or arbitration matters during the reporting period - The company had **no major litigation or arbitration matters** during this reporting period[111](index=111&type=chunk) [Media Queries](index=28&type=section&id=%E5%AA%92%E4%BD%93%E8%B4%A8%E7%96%91%E6%83%85%E5%86%B5) The company was not subject to widespread media questioning during the reporting period - The company had **no widespread media questioning** during this reporting period[112](index=112&type=chunk) [Non-operational Fund Occupation by Controlling Shareholder and Affiliates](index=28&type=section&id=%E6%8E%A7%E8%82%A1%E8%82%A1%E4%B8%9C%E5%8F%8A%E5%85%B6%E5%85%B3%E8%81%94%E6%96%B9%E5%AF%B9%E4%B8%8A%E5%B8%82%E5%85%AC%E5%8F%B8%E7%9A%84%E9%9D%9E%E7%BB%8F%E8%90%A5%E6%80%A7%E5%8D%A0%E7%94%A8%E8%B5%84%E9%87%91%E6%83%85%E5%86%B5) There was no non-operational fund occupation by the controlling shareholder or its affiliates - During the reporting period, there was **no non-operational occupation of the company's funds** by the controlling shareholder and its affiliates[114](index=114&type=chunk) [Bankruptcy and Reorganization Matters](index=28&type=section&id=%E7%A0%B4%E4%BA%A7%E9%87%8D%E6%95%B4%E7%9B%B8%E5%85%B3%E4%BA%8B%E9%A1%B9) The company had no bankruptcy or reorganization matters during the reporting period - The company had **no bankruptcy or reorganization matters** during the reporting period[115](index=115&type=chunk) [Asset Transactions](index=28&type=section&id=%E8%B5%84%E4%BA%A7%E4%BA%A4%E6%98%93%E4%BA%8B%E9%A1%B9) The company acquired two mining companies and sold its stake in a public facilities company Asset Acquisitions The company acquired two mining companies to expand its iron ore business and enhance profitability Asset Acquisition Details | Acquired Asset | Transaction Price (million Yuan) | Progress | Impact on Company Operations | | :--- | :--- | :--- | :--- | | 90% equity in Wuhu Taiping Mining Co, Ltd | 100.10 | Asset ownership fully transferred, debts and liabilities fully transferred, now in production | Helps to rapidly increase market share in iron ore mining and processing, enhancing profitability | | 70% equity in Shandong Shengxin Mining Co, Ltd | 140.00 | Asset ownership fully transferred, debts and liabilities fully transferred, currently in construction phase | Further develops the company's iron ore mining and processing business | Asset Sales The company sold its equity and creditor's rights in Changchun Chunhua Public Facilities Co, Ltd Asset Sale Details | Sold Asset | Transaction Price (million Yuan) | Net Profit Contribution from Asset (Beginning of Period to Sale Date) (million Yuan) | Impact of Sale on the Company | Net Profit Contribution from Sale as a % of Total Net Profit | | :--- | :--- | :--- | :--- | :--- | | 33.33% equity and 12.5 million Yuan creditor's rights in Changchun Chunhua Public Facilities Co, Ltd | 26.78 | 13.08 | The transfer generated an investment gain of 13.08 million Yuan, increasing the company's total profit | 10.27% | Business Combinations The company had no business combinations during the reporting period - The company had **no business combinations** during the reporting period[120](index=120&type=chunk) [Implementation and Impact of Equity Incentive Plans](index=30&type=section&id=%E5%85%AC%E5%8F%B8%E8%82%A1%E6%9D%83%E6%BF%80%E5%8A%B1%E7%9A%84%E5%AE%9E%E6%96%BD%E6%83%85%E5%86%B5%E5%8F%8A%E5%85%B6%E5%BD%B1%E5%93%8D) The company did not implement any equity incentive plans during the reporting period - The company **did not implement any equity incentive plans** during the reporting period[120](index=120&type=chunk) [Major Related-Party Transactions](index=30&type=section&id=%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) The company's major related-party transaction involved outsourcing iron ore processing services Related-Party Transactions in Daily Operations The company engaged in a related-party transaction for iron ore processing with Loufan County Shentai Mineral Processing Co, Ltd Related-Party Transactions in Daily Operations (2013) | Related Party | Transaction Type | Transaction Content | Pricing Principle | Price | Amount (million Yuan) | % of Similar Transactions | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Loufan County Shentai Mineral Processing Co, Ltd | Purchase of goods or services | Outsourced iron ore processing | Based on Shentai's processing cost plus a 10% markup | 135 Yuan/ton for concentrate processing | 14.19 | 100% | - The outsourced processing transaction with the related party is beneficial to the company's production and long-term development, does not harm the interests of the company or other shareholders, and does not affect the company's independence[121](index=121&type=chunk) Related-Party Transactions in Asset Acquisitions and Sales The company had no related-party transactions involving asset acquisitions or sales - The company had **no related-party transactions** involving asset acquisitions or sales during the reporting period[123](index=123&type=chunk) Major Related-Party Transactions in Joint Investments The company had no major related-party transactions involving joint investments - The company had **no major related-party transactions** involving joint investments during the reporting period[124](index=124&type=chunk) Related-Party Debts and Credits The company has historical non-operational related-party debts and credits that do not impact its financial results - The company has **non-operational related-party debts and credits**[125](index=125&type=chunk) Related-Party Debts and Credits (2013) | Related Party | Debt/Credit Type | Reason | Beginning Balance (million Yuan) | Current Period Amount (million Yuan) | Ending Balance (million Yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | | Shanghai Taihui Software Technology Co, Ltd | Receivable from related party | Dividends from former subsidiary | 6.39 | 0 | 6.39 | | Changchun Chunhua Public Facilities Co, Ltd | Receivable from related party | Loan | 12.50 | -3.72 | 8.78 | | Changchun Chunhua Public Facilities Co, Ltd | Receivable from related party | Loan interest | 2.14 | 0.90 | 3.03 | - The above related-party debts and credits are historical and **do not affect** the company's operating results or financial position[125](index=125&type=chunk) Other Major Related-Party Transactions The company had no other major related-party transactions during the reporting period - The company had **no other major related-party transactions** during the reporting period[126](index=126&type=chunk) [Major Contracts and Their Performance](index=32&type=section&id=%E9%87%8D%E5%A4%A7%E5%90%88%E5%90%8C%E5%8F%8A%E5%85%B6%E5%B1%A5%E8%A1%8C%E6%83%85%E5%86%B5) The company had no托管, contracting, or leasing matters, but executed several major contracts for asset transactions Custody, Contracting, and Leasing Matters The company had no custody, contracting, or leasing matters during the reporting period - The company had **no custody, contracting, or leasing matters** during the reporting period[128](index=128&type=chunk) Guarantees The company provided no external guarantees during the reporting period - The company had **no external guarantees** (excluding guarantees for subsidiaries) during the reporting period[129](index=129&type=chunk) - The company had **no guarantees for its subsidiaries** during the reporting period[130](index=130&type=chunk) - The company had **no irregular external guarantees** during the reporting period[131](index=131&type=chunk) Other Major Contracts The company executed several major contracts for asset acquisitions and sales, all of which are completed or in progress Other Major Contracts | Company Party | Counterparty | Contract Date | Appraised Value of Asset (million Yuan) | Transaction Price (million Yuan) | Execution Status as of Period-End | | :--- | :--- | :--- | :--- | :--- | :--- | | Shandong Ludi Mining Investment Co, Ltd | Individuals Yang Mingwen, Hefei Guoxuan Real Estate Co, Ltd, Anhui Weijia Industry & Trade Co, Ltd | 2013-10-12 | 100.10 | 100.10 | Completed | | Shandong Land & Mining Co, Ltd | Changchun Underground Space Development Company | 2013-12-24 | 26.78 | 26.78 | Completed | | Shandong Ludi Mining Investment Co, Ltd | Shandong Huarong Venture Capital Co, Ltd | 2014-01-10 | 140.00 | 140.00 | Completed | Other Major Transactions The company had no other major transactions during the reporting period - The company had **no other major transactions** during the reporting period[134](index=134&type=chunk) [Performance of Commitments](index=34&type=section&id=%E6%89%BF%E8%AF%BA%E4%BA%8B%E9%A1%B9%E5%B1%A5%E8%A1%8C%E6%83%85%E5%86%B5) All shareholders strictly fulfilled their commitments, though the 2013 profit forecast was not met Commitments Made by the Company or Shareholders with over 5% Holding Shareholders with over 5% holding strictly fulfilled all commitments regarding competition, related transactions, and share lock-ups - All committing parties, including Shandong Provincial Bureau of Geology and Mineral Resources, Ludi Holding, and the Geodetic Surveying and Mapping Institute, **strictly fulfilled their commitments to avoid competition**[134](index=134&type=chunk)[135](index=135&type=chunk)[136](index=136&type=chunk) - All committing parties **strictly fulfilled their commitments to reduce and regulate related-party transactions**[136](index=136&type=chunk)[137](index=137&type=chunk) - All committing parties **strictly fulfilled their commitments to ensure the listed company's "five separations"** (personnel, assets, finance, organization, business)[137](index=137&type=chunk) - All committing parties, including Ludi Holding, Geodetic Surveying and Mapping Institute, Shandong Huayuan, Beijing Zhengrun, Baoderui, Shandong Dili, Shandong State-owned Investment, and Chu Zhibang, **strictly fulfilled their share lock-up commitments**[138](index=138&type=chunk)[139](index=139&type=chunk) - Ludi Holding and other committing parties are currently fulfilling the profit forecast and compensation commitments, with **no violations** to date[141](index=141&type=chunk)[142](index=142&type=chunk) Explanation on Achieving Profit Forecasts for Assets or Projects The actual profit from the major asset restructuring in 2013 fell short of the forecast Major Asset Restructuring Profit Forecast (2013) | Asset or Project Name | Forecast Start Date | Forecast End Date | Forecasted Performance (million Yuan) | Actual Performance (million Yuan) | | :--- | :--- | :--- | :--- | :--- | | Major Asset Restructuring Profit Forecast (2013) | 2013-01-01 | 2013-12-31 | 161.25 | 132.78 | [Appointment and Dismissal of Accounting Firm](index=42&type=section&id=%E8%81%98%E4%BB%BB%E3%80%81%E8%A7%A3%E8%81%98%E4%BC%9A%E8%AE%A1%E5%B8%88%E4%BA%8B%E5%8A%A1%E6%89%80%E6%83%85%E5%86%B5) The company continued to engage ShineWing as its domestic and internal control audit firm - The company currently engages **ShineWing Certified Public Accountants (Special General Partnership)** as its domestic accounting firm, with a remuneration of **0.4 million Yuan** and 2 consecutive years of audit service[144](index=144&type=chunk) - This year, the company also engaged ShineWing as its internal control audit firm, paying an audit fee of **0.25 million Yuan**[144](index=144&type=chunk) - The accounting firm was **not changed** during the reporting period[144](index=144&type=chunk) [Supervisory Committee and Independent Directors' Statement on "Non-standard Audit Report"](index=42&type=section&id=%E7%9B%91%E4%BA%8B%E4%BC%9A%E3%80%81%E7%8B%AC%E7%AB%8B%E8%91%A3%E4%BA%8B%EF%BC%88%E5%A6%82%E9%80%82%E7%94%A8%EF%BC%89%E5%AF%B9%E4%BC%9A%E8%AE%A1%E5%B8%88%E4%BA%8B%E5%8A%A1%E6%89%80%E6%9C%AC%E6%8A%A5%E5%91%8A%E6%9C%9F%22%E9%9D%9E%E6%A0%87%E5%87%86%E5%AE%A1%E8%AE%A1%E6%8A%A5%E5%91%8A%22%E7%9A%84%E8%AF%B4%E6%98%8E) This section is not applicable as the accounting firm issued a standard unqualified audit report - This section is **not applicable** as the accounting firm issued a standard unqualified audit report[145](index=145&type=chunk) [Penalties and Rectifications](index=42&type=section&id=%E5%A4%84%E7%BD%9A%E5%8F%8A%E6%95%B4%E6%94%B9%E6%83%85%E5%86%B5) A company supervisor was penalized for irregular stock trading, and the illegal gains were recovered - Company supervisor Song Shaoqin was involved in irregular trading of company stock, and the illegal gains of **366.80 Yuan** were recovered on March 29, 2013[146](index=146&type=chunk) - The company has **no other rectification matters** to report[145](index=145&type=chunk) [Risk of Suspension or Termination of Listing After Annual Report Disclosure](index=43&type=section&id=%E5%B9%B4%E5%BA%A6%E6%8A%A5%E5%91%8A%E6%8A%AB%E9%B2%B2%E5%90%8E%E9%9D%A2%E4%B8%B4%E6%9A%82%E5%81%9C%E4%B8%8A%E5%B8%82%E5%92%8C%E7%BB%88%E6%AD%A2%E4%B8%8A%E5%B8%82%E6%83%85%E5%86%B5) The company faces no risk of suspension or termination of listing after this report's disclosure - The company **faces no risk of suspension or termination of listing** after the disclosure of this annual report[147](index=147&type=chunk) [Other Significant Matters](index=43&type=section&id=%E5%85%B6%E4%BB%96%E9%87%8D%E5%A4%A7%E4%BA%8B%E9%A1%B9%E7%9A%84%E8%AF%B4%E6%98%8E) The company completed its restructuring, had its special treatment status revoked, and changed its name - On January 17, 2013, the company's newly issued shares from the major asset restructuring were listed, increasing the total share capital to **472,709,345 shares**[147](index=147&type=chunk) - Effective April 3, 2013, the "Other Special Treatment" on the company's stock was revoked, the stock short name changed from "ST Taifu" to "Taifu Industry", and the daily price fluctuation limit was restored to **10%**[148](index=148&type=chunk) - On December 23, 2013, the company's name was officially changed to "Shandong Land & Mining Co, Ltd", and the stock short name was changed to "Shandong Land & Mining"[149](index=149&type=chunk) - On February 13, 2014, **78,286,827 restricted shares** from the major asset restructuring were released from lock-up and became tradable[149](index=149&type=chunk) [Significant Matters of Subsidiaries](index=43&type=section&id=%E5%85%AC%E5%8F%B8%E5%AD%90%E5%85%AC%E5%8F%B8%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) The company's subsidiaries were involved in several acquisitions, one termination, and the establishment of a new entity - The company's wholly-owned subsidiary, Shandong Ludi Mining Investment Co, Ltd, **terminated the acquisition** of a 60% stake in Weifang Congxing Mining Co, Ltd, with no impact on the company[151](index=151&type=chunk) - Ludi Investment acquired a **90% stake in Wuhu Taiping Mining Co, Ltd for 100.10 million Yuan**, which officially started production on January 23, 2014[153](index=153&type=chunk)[157](index=157&type=chunk) - The company invested **30 million Yuan to establish Shenzhen Taifu Xinhuida Equity Investment Fund Management Co, Ltd**, holding a 60% stake, which has completed business registration[154](index=154&type=chunk) - The company transferred its **33.33% equity stake and 12.5 million Yuan creditor's rights** in Changchun Chunhua Public Facilities Co, Ltd, which is beneficial to its main business operations[155](index=155&type=chunk) - On January 10, 2014, Ludi Investment acquired a **70% stake in Shandong Shengxin Mining Co, Ltd for 140 million Yuan**[156](index=156&type=chunk) [Corporate Bond Issuance](index=44&type=section&id=%E5%85%AC%E5%8F%B8%E5%8F%91%E8%A1%8C%E5%85%AC%E5%8F%B8%E5%80%BA%E5%88%B8%E7%9A%84%E6%83%85%E5%86%B5) The company did not issue any corporate bonds during the reporting period - The company **did not issue any corporate bonds** during the reporting period[158](index=158&type=chunk) Section 6: Share Capital Changes and Shareholder Information [Changes in Share Capital](index=45&type=section&id=%E8%82%A1%E4%BB%BD%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5) The company's total share capital increased due to a major asset restructuring, followed by a release of restricted shares - On January 17, 2013, the company issued **301,335,197 new shares** as part of a major asset restructuring, increasing the total share capital to **472,709,345 shares**[161](index=161&type=chunk) Share Capital Changes (Year-End 2013) | Share Type | Before Change (Shares) | % | Change (+, -) (Shares) | After Change (Shares) | % | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Restricted Shares | 2,315,114 | 1.35% | 301,335,547 | 303,650,661 | 64.24% | | 2. State-owned Legal Person Shares | - | - | 155,147,367 | 155,147,367 | 32.82% | | 3. Other Domestic Shares | 2,315,114 | 1.35% | 146,188,180 | 148,503,294 | 31.41% | | II. Unrestricted Shares | 169,059,034 | 98.64% | -350 | 169,058,684 | 35.76% | | III. Total Shares | 171,374,148 | 100% | 301,335,197 | 472,709,345 | 100% | - On February 13, 2014, **78,286,827 restricted shares**, representing 16.56% of the company's total share capital, were released from lock-up and became tradable[164](index=164&type=chunk) Company Share Structure After Restricted Share Release | Share Type | Before Release | % | Change | After Release | % | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Total Restricted Shares | 303,650,311 | 64.24 | -78,286,827 | 225,363,484 | 47.68 | | II. Total Unrestricted Shares | 169,059,034 | 35.76 | 78,286,827 | 247,345,861 | 52.32 | | III. Total Shares | 472,709,345 | 100 | 0 | 472,709,345 | 100 | [Securities Issuance and Listing](index=47&type=section&id=%E8%AF%81%E5%88%B8%E5%8F%91%E8%A1%8C%E4%B8%8E%E4%B8%8A%E5%B8%82%E6%83%85%E5%86%B5) The company issued new shares as part of a major asset restructuring, which altered its share capital and ownership structure Securities Issuances in the Last Three Years | Security Name | Issue Date | Issue Price (or Rate) | Issue Volume | Listing Date | Approved Trading Volume | | :--- | :--- | :--- | :--- | :--- | :--- | | Equity - Shares Issued for Asset Purchase | 2012-12-28 | 5.99 | 301,335,197 | 2013-01-16 | 301,335,197 | - The company's total share capital increased from **171,374,148 to 472,709,345 shares**, Shandong Ludi Investment Holding Co, Ltd became the controlling shareholder, and the company's asset and liability structure changed accordingly[168](index=168&type=chunk) [Existing Internal Employee Shares](index=47&type=section&id=%E7%8E%B0%E5%AD%98%E7%9A%84%E5%86%85%E9%83%A8%E8%81%8C%E5%B7%A5%E8%82%A1%E6%83%85%E5%86%B5) The company had no existing internal employee shares during the reporting period - The company had **no existing internal employee shares** during the reporting period[169](index=169&type=chunk) [Shareholders and Actual Controller](index=47&type=section&id=%E8%82%A1%E4%B8%9C%E5%92%8C%E5%AE%9E%E9%99%85%E6%8E%A7%E5%88%B6%E4%BA%BA%E6%83%85%E5%86%B5) The company's controlling shareholder is Shandong Land & Mining Group, with the Shandong Provincial Bureau of Geology as the actual controller Number of Shareholders and Shareholding Details As of the end of the reporting period, the company had 14,346 shareholders, with some major shareholders having pledged their shares - The total number of shareholders at the end of the reporting period was **14,346**[171](index=171&type=chunk) Top 10 Shareholders or Shareholders with over 5% Holding (Year-End 2013) | Shareholder Name | Nature | Shareholding (%) | Shares Held at Period-End | Restricted Shares | Unrestricted Shares | Pledged or Frozen Status | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Shandong Land & Mining Group Co, Ltd | State-owned Legal Person | 23.92% | 113,060,314 | 113,060,314 | - | - | | Shandong Huayuan Venture Capital Co, Ltd | Domestic Non-state-owned Legal Person | 15.06% | 71,212,506 | 71,212,506 | - | - | | Beijing Zhengrun Venture Capital Co, Ltd | Domestic Non-state-owned Legal Person | 8.12% | 38,383,200 | 38,383,200 | - | Pledged 33,000,000 shares | | Shandong State-owned Assets Investment Holding Co, Ltd | State-owned Legal Person | 5.7% | 26,941,863 | 26,941,863 | - | - | | Beijing Baoderui Venture Capital Co, Ltd | Domestic Non-state-owned Legal Person | 5.36% | 25,315,661 | 25,315,661 | - | Pledged 25,000,000 shares | | Huatai Securities Co, Ltd Agreed Repurchase Special Account | Domestic Non-state-owned Legal Person | 3.62% | 17,100,000 | - | 17,100,000 | - | | Guoyuan Securities Co, Ltd Agreed Repurchase Special Account | Domestic Non-state-owned Legal Person | 3.21% | 15,151,000 | - | 15,151,000 | - | | Shandong Provincial Geodetic Surveying and Mapping Institute | State-owned Legal Person | 3.2% | 15,145,190 | 15,145,190 | - | - | | Haitong Securities Co, Ltd Agreed Repurchase Special Account | Domestic Non-state-owned Legal Person | 2.94% | 13,904,700 | - | 13,904,700 | - | | Shandong Dili Investment Co, Ltd | Domestic Non-state-owned Legal Person | 1.32% | 6,228,067 | 6,228,067 | - | - | - Due to agreed repurchase transactions, Anhui Fengyuan Group Co, Ltd's proportion of unrestricted shares **decreased from 9.72% to 0.0059%**[175](index=175&type=chunk) Controlling Shareholder The company's controlling shareholder is Shandong Land & Mining Group Co, Ltd Controlling Shareholder Information | Controlling Shareholder Name | Legal Representative | Establishment Date | Registered Capital | Main Business | | :--- | :--- | :--- | :--- | :--- | | Shandong Land & Mining Group Co, Ltd | Liu Changchun | 2010-09-19 | 300,000,000 | Investment and asset management with own funds; mineral exploration technology development and consulting services | - The company's controlling shareholder changed to **Shandong Land & Mining Group Co, Ltd** on January 16, 2013[176](index=176&type=chunk) Actual Controller The company's actual controller is the Shandong Provincial Bureau of Geology and Mineral Exploration and Development Actual Controller Information | Actual Controller Name | Legal Representative | Establishment Date | Registered Capital | Main Business | | :--- | :--- | :--- | :--- | :--- | | Shandong Provincial Bureau of Geology and Mineral Exploration and Development | Wang Yujun | - | - | Primarily responsible for geological and mineral exploration, hydrogeological exploration, environmental geological exploration, and survey construction | - The company's actual controller changed to the **Shandong Provincial Bureau of Geology and Mineral Exploration and Development** on January 16, 2013[178](index=178&type=chunk) Other Corporate Shareholders with over 10% Holding Shandong Huayuan Venture Capital Co, Ltd is the only other corporate shareholder with over 10% holding Other Corporate Shareholders with over 10% Holding | Corporate Shareholder Name | Legal Representative | Establishment Date | Registered Capital | Main Business or Management Activities | | :--- | :--- | :--- | :--- | :--- | | Shandong Huayuan Venture Capital Co, Ltd | Cai Yichao | 2007-03-09 | 307.05 million Yuan | Venture capital business; acting as an agent for other venture capital enterprises; venture capital consulting; providing management services for startups; participating in the establishment of venture capital enterprises and management consulting institutions | [Share Increase Plans by Shareholders and Their Concert Parties](index=52&type=section&id=%E5%85%AC%E5%8F%B8%E8%82%A1%E4%B8%9C%E5%8F%8A%E5%85%B6%E4%B8%80%E8%87%B4%E8%A1%8C%E5%8A%A8%E4%BA%BA%E5%9C%A8%E6%8A%A5%E5%91%8A%E6%9C%9F%E6%8F%90%E5%87%BA%E6%88%96%E5%AE%9E%E6%96%BD%E8%82%A1%E4%BB%BD%E5%A2%9E%E6%8C%81%E8%AE%A1%E5%88%92%E7%9A%84%E6%83%85%E5%86%B5) No shareholders or their concert parties proposed or implemented share increase plans - During the reporting period, **no shareholders or their concert parties** had any share increase plans[180](index=180&type=chunk) Section 7: Directors, Supervisors, Senior Management, and Employees [Changes in Shareholdings of Directors, Supervisors, and Senior Management](index=53&type=section&id=%E8%91%A3%E4%BA%8B%E3%80%81%E7%9B%91%E4%BA%8B%E5%92%8C%E9%AB%98%E7%BA%A7%E7%AE%A1%E7%90%86%E4%BA%BA%E5%91%98%E6%8C%81%E8%82%A1%E5%8F%98%E5%8A%A8) Only one supervisor increased their shareholding during the reporting period Shareholding Changes of Directors, Supervisors, and Senior Management (2013) | Name | Position | Status | Beginning Shares | Shares Increased | Shares Decreased | Ending Shares | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Song Shaoqin | Supervisor | Current | 0 | 200 | 0 | 200 | | Li Lanzhou | Chairman of Supervisory Committee | Resigned | 200 | 0 | 0 | 200 | | Total | -- | -- | 200 | 200 | 0 | 400 | [Positions Held](index=54&type=section&id=%E4%BB%BB%E8%81%8C%E6%83%85%E5%86%B5) This section details the recent work experience of current directors, supervisors, and senior management - Mr Hu Xiangdong currently serves as the **Chairman** of Shandong Land & Mining Co, Ltd, and also holds positions as a director and general manager at Shandong Land & Mining Group Co, Ltd[183](index=183&type=chunk) - Mr Guo Changzhou currently serves as a **Director and General Manager** of Shandong Land & Mining Co, Ltd, and also as the chairman of Shandong Ludi Mining Investment Co, Ltd[185](index=185&type=chunk)[186](index=186&type=chunk) - Independent directors Chen Zhijun, Wang Lejin, and Wang Ai meet the qualification requirements, **do not hold any company shares**, and have no affiliation with the company or its actual controller[187](index=187&type=chunk)[188](index=188&type=chunk) - Several directors, supervisors, and senior managers hold **concurrent positions** in shareholder entities or other organizations, with some receiving remuneration or allowances[195](index=195&type=chunk) [Remuneration of Directors, Supervisors, and Senior Management](index=57&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%E6%8A%A5%E9%85%AC%E6%83%85%E5%86%B5) The total remuneration for directors, supervisors, and senior management in 2013 was 2.64 million Yuan - The remuneration for directors and supervisors is decided by the Board of Directors and approved by the shareholders' meeting; senior management remuneration is decided by the Board of Directors and approved after review by the Remuneration and Appraisal Committee[196](index=196&type=chunk) - In 2013, the total remuneration for directors, supervisors, and senior management receiving compensation from the company was **2.64 million Yuan**, with independent director allowances totaling **60,000 Yuan** (Mr Chen Zhijun did not receive his)[197](index=197&type=chunk)[198](index=198&type=chunk) - **No equity incentives were granted** to them during the reporting period[199](index=199&type=chunk) [Changes in Directors, Supervisors, and Senior Management](index=59&type=section&id=%E5%85%AC%E5%8F%B8%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%8F%98%E5%8A%A8%E6%83%85%E5%86%B5) The company underwent significant changes in its board and management team following the major asset restructuring - On January 25, 2013, following the completion of the major asset restructuring, the Board of Directors was re-elected, and several former directors, the general manager, and the CFO resigned[199](index=199&type=chunk) - On December 18, 2013, the Board of Directors and Supervisory Committee were re-elected for a new term, with several new directors and supervisors being appointed[199](index=199&type=chunk) - The company appointed Dai Jinhong as Deputy General Manager[199](index=199&type=chunk) [Changes in Core Technical Team or Key Technical Personnel](index=59&type=section&id=%E6%8A%A5%E5%91%8A%E6%9C%9F%E6%A0%B8%E5%BF%83%E6%8A%80%E6%9C%AF%E5%9B%A2%E9%98%9F%E6%88%96%E5%85%B3%E9%94%AE%E6%8A%80%E6%9C%AF%E4%BA%BA%E5%91%98%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5%EF%BC%88%E9%9D%9E%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%EF%BC%89) There were no changes in the core technical team or key technical personnel during the reporting period - There were **no changes** in the core technical team or key technical personnel during the reporting period[200](index=200&type=chunk) [Employee Information](index=60&type=section&id=%E5%85%AC%E5%8F%B8%E5%91%98%E5%B7%A5%E6%83%85%E5%86%B5) The company and its main subsidiaries had a total of 1,144 employees, with production staff forming the largest group Head Office Employees As of year-end 2013, the head office had 57 employees, primarily in management roles Professional Composition of Head Office Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Production Staff (Logistics) | 4 | 7.02% | | Management Staff | 37 | 64.91% | | Technical Staff | 9 | 15.79% | | Finance Staff | 7 | 12.28% | | Total | 57 | 100% | Educational Level of Head Office Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Doctorate | 2 | 3.51% | | Master's | 15 | 26.32% | | Bachelor's Degree or above | 29 | 50.88% | | College Diploma | 7 | 12.28% | | Technical School & High School | 4 | 7.02% | | Total | 57 | 100% | Ludi Investment Employees As of year-end 2013, Ludi Investment had 5 employees, with a focus on management and technical roles Professional Composition of Ludi Investment Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Management Staff | 2 | 40% | | Technical Staff | 2 | 40% | | Finance Staff | 1 | 20% | | Total | 5 | 100% | Educational Level of Ludi Investment Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Master's | 1 | 20% | | Bachelor's Degree or above | 3 | 60% | | Technical School & High School | 1 | 20% | | Total | 5 | 100% | Xulou Iron Mine Employees As of year-end 2013, Xulou Iron Mine had 699 employees, predominantly production staff Professional Composition of Xulou Iron Mine Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Production Staff (Logistics) | 627 | 89.70% | | Management Staff | 9 | 1.29% | | Technical Staff | 53 | 7.58% | | Sales Staff | 4 | 0.57% | | Finance Staff | 6 | 0.86% | | Total | 699 | 100% | Educational Level of Xulou Iron Mine Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Master's | 2 | 0.29% | | Bachelor's Degree or above | 34 | 4.86% | | College Diploma | 67 | 9.59% | | Technical School | 96 | 13.73% | | High School or below | 500 | 71.53% | | Total | 699 | 100% | Loufan Iron Mine Employees As of year-end 2013, Loufan Iron Mine had 246 employees, with a majority in production roles Professional Composition of Loufan Iron Mine Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Production Staff (Logistics) | 195 | 79.27% | | Management Staff | 8 | 3.25% | | Sales Staff | 2 | 0.81% | | Finance Staff | 3 | 1.22% | | Technical Staff | 38 | 15.45% | | Total | 246 | 100% | Educational Level of Loufan Iron Mine Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Master's | 2 | 0.18% | | Bachelor's Degree or above | 21 | 8.54% | | College Diploma | 26 | 10.57% | | Technical School & High School | 71 | 28.86% | | Junior High School or below | 126 | 51.22% | | Total | 246 | 100% | Wuhu Taiping Iron Mine Employees As of year-end 2013, Wuhu Taiping Iron Mine had 132 employees, split between production and technical staff Professional Composition of Wuhu Taiping Iron Mine Employees (2013) | Category | Number of People | Percentage (%) | | :--- | :--- | :--- | | Production Staff | 65 | 49.24% | | Management Staff | 5 | 3.79% | | Sales Staff | 3 | 2.27% | | Technical Staff | 56 | 42.42% | | Finance Staff | 3 | 2.27% | | Total | 132 | 100% | Educational Level of Wuhu Taiping Iron Mine Employees (2013) | Category | Number of People | Percentage