Financial Performance - The company's operating revenue for Q1 2023 was ¥31,851,309,332.44, representing a 2.41% increase compared to ¥31,102,554,707.79 in the same period last year[4] - Net profit attributable to shareholders decreased by 18.25% to ¥254,827,069.73 from ¥311,700,272.58 year-on-year[4] - The net profit after deducting non-recurring gains and losses fell by 50.64% to ¥152,600,450.03 compared to ¥309,156,999.92 in the previous year[4] - The net profit for Q1 2023 was CNY 298,022,212.36, a decrease of 18.4% compared to CNY 365,128,092.68 in Q1 2022[14] - Operating profit for Q1 2023 was CNY 222,294,455.39, down 53.8% from CNY 481,516,941.01 in Q1 2022[14] - The company reported a total comprehensive income of CNY 290,451,514.00 for Q1 2023, down from CNY 390,041,007.09 in Q1 2022[15] - Basic earnings per share for Q1 2023 were CNY 0.02, compared to CNY 0.03 in the previous year[15] Cash Flow and Assets - The net cash flow from operating activities increased by 7.50% to ¥3,103,135,686.04 from ¥2,886,684,112.79 year-on-year[4] - Cash received from investment activities decreased by 349.36% year-on-year, mainly due to compensation received in the previous year for relocation[7] - The company's cash and cash equivalents at the end of Q1 2023 amounted to CNY 36.81 billion, compared to CNY 34.48 billion at the beginning of the year, reflecting a growth of approximately 6.7%[11] - The total assets at the end of the reporting period were ¥254,514,059,648.75, a 0.47% increase from ¥253,231,025,319.37 at the end of the previous year[4] - The total assets of the company as of the end of Q1 2023 were CNY 254.51 billion, slightly up from CNY 253.23 billion at the beginning of the year[12] - Cash and cash equivalents at the end of Q1 2023 totaled CNY 21,880,714,563.40, down from CNY 27,501,592,408.99 at the end of Q1 2022[17] - The company’s total assets decreased from CNY 27,501,592,408.99 at the end of Q1 2022 to CNY 21,880,714,563.40 at the end of Q1 2023[17] Liabilities and Borrowings - Long-term borrowings increased by 46.64% year-on-year, attributed to the renewal of borrowings due within one year[7] - Long-term borrowings rose significantly to CNY 25.95 billion from CNY 17.70 billion, marking an increase of approximately 46.5%[13] - The total liabilities increased to CNY 187.62 billion from CNY 186.77 billion, reflecting a rise of about 0.5%[13] - The company raised CNY 41,407,946,850.08 through borrowings in Q1 2023, compared to CNY 34,784,289,378.00 in Q1 2022[17] Research and Development - Research and development expenses increased by 29.34% year-on-year, indicating a focus on enhancing product quality and optimizing product structure[7] - Research and development expenses increased to CNY 618,146,759.38, up 29.4% from CNY 477,936,468.54 in the previous year[14] Operational Metrics - The total operating costs for Q1 2023 were CNY 31.79 billion, up from CNY 30.77 billion year-on-year, indicating an increase of about 3.3%[13] - Total revenue from operating activities was CNY 31,334,668,732.66, slightly up from CNY 31,181,530,763.25 in the same period last year[16] - Accounts receivable increased to CNY 2.36 billion from CNY 2.31 billion, showing a rise of about 2.5%[11] - Inventory decreased to CNY 20.77 billion from CNY 22.12 billion, indicating a reduction of approximately 6.1%[12] Future Outlook - The company plans to continue its market expansion and product development strategies in the upcoming quarters[12] Non-Operating Income - The company reported a significant increase of 3116.66% in non-operating income, primarily due to penalties received from Tangshan Steel Construction Development Co., Ltd.[7]

Financial Performance - The company's operating revenue for 2022 was ¥143.47 billion, a decrease of 4.11% compared to ¥149.63 billion in 2021[11]. - The net profit attributable to shareholders for 2022 was ¥1.40 billion, down 48.10% from ¥2.69 billion in 2021[11]. - The net cash flow from operating activities was ¥9.24 billion, a decline of 37.18% from ¥14.70 billion in 2021[11]. - Basic earnings per share for 2022 were ¥0.13, a decrease of 45.83% compared to ¥0.24 in 2021[11]. - The total assets at the end of 2022 were ¥253.23 billion, an increase of 4.03% from ¥243.42 billion at the end of 2021[11]. - The net assets attributable to shareholders at the end of 2022 were ¥54.94 billion, up 7.65% from ¥51.04 billion at the end of 2021[11]. - The company reported a significant decrease in net profit after deducting non-recurring gains and losses, which was ¥832.53 million, down 61.86% from ¥2.18 billion in 2021[11]. - The weighted average return on equity for 2022 was 2.64%, a decrease of 2.30% from 4.94% in 2021[11]. - The total operating revenue for 2022 was ¥143.47 billion, a decrease of 4.11% compared to ¥149.63 billion in 2021[31]. - The gross profit margin for the steel industry was 9.49%, a decrease of 1.33% from the previous year[34]. - The company reported a significant increase in sales of steel billets, with revenue rising by 76.46% to ¥4.59 billion[31]. - The revenue from the chemical industry decreased by 13.89% to ¥1.47 billion, down from ¥1.71 billion in 2021[31]. - The company reported a net profit attributable to shareholders of CNY 188.8 million in Q3 2022, a decline compared to Q2, with operating revenue at CNY 38.0 billion[14]. - The company achieved a product performance qualification rate of over 95% for newly developed products in the engineering machinery steel category[41]. Dividend and Profit Distribution - The company plans to distribute a cash dividend of ¥0.40 per 10 shares, based on a total of 10,337,121,092 shares[2]. - The cash dividend amount distributed was ¥413,484,843.68, representing 100% of the profit distribution total[106]. - The cash dividend policy requires a minimum of 80% of profit distribution to be in cash for mature companies without major capital expenditure plans[106]. - The company reported a total distributable profit of ¥7,836,312,249.42 for the year 2022[106]. Research and Development - The company successfully developed nearly 100 new products in 2022, enhancing the quality and variety of its offerings[22]. - The number of R&D personnel increased to 655 in 2022, a rise of 37.32% compared to 477 in 2021[42]. - R&D investment amounted to approximately ¥3.06 billion in 2022, down 17.23% from ¥3.70 billion in 2021, representing 2.13% of total revenue[44]. - The company aims to achieve a purity of ≥98% for sodium vanadate and chromium acid products through new separation technologies[40]. - The new technology for producing 99% high-purity vanadium is expected to generate an additional annual output value of over ¥100 million by recycling approximately 1,000 tons of vanadium pentoxide[40]. - The company is developing a high-efficiency extraction and separation technology for vanadium and chromium, targeting a recovery rate of over 95%[40]. - Increased investment in technology research and development is planned to address bottlenecks in products, processes, and costs[62]. Environmental Initiatives - The company is actively pursuing green development initiatives, achieving significant results in energy conservation and emissions reduction, positioning itself as a leader in the industry[21]. - The company has implemented ultra-low emission standards for air pollutants in the steel industry, with specific limits for various processes[119]. - The company has reported no instances of exceeding permitted emission limits during the reporting period[118]. - The company has implemented multiple environmental governance projects, resulting in a significant reduction in pollutant emissions, including a substantial improvement in the emissions of sulfur dioxide, nitrogen oxides, and particulate matter per ton of steel[127]. - The company invested a total of 148.913 million yuan in environmental protection facilities and projects during the reporting period[127]. - The company has established 127 sets of waste gas treatment facilities in accordance with the "three simultaneous" management system, ensuring compliance with ultra-low emission standards[124]. - The company is exploring market expansion opportunities to enhance its operational efficiency and sustainability initiatives[122]. Market and Competition - The company faces market competition risks due to uncertain downstream demand and overcapacity in the steel industry, prompting ongoing product and customer optimization efforts[68]. - The company is strategically located in a developed economic area, benefiting from the implementation of the Belt and Road Initiative and regional development plans[23]. - The company is focusing on increasing the proportion of high-priced products by restructuring product pricing and forming cross-functional teams to boost high-margin product sales[65]. Financial Management - The company is committed to maintaining cash flow stability by optimizing financing structures and enhancing cash flow auditing processes[66]. - The company has a loan repayment rate of 100.00% and an interest payment rate of 100.00%[182]. - The company has maintained compliance with the intended use of raised funds as per the bond issuance documents[180]. - The audit opinion for the financial statements is a standard unqualified opinion, indicating fair representation of the company's financial status[183]. Corporate Governance - The board of directors has approved a performance-based compensation plan for executives, aligning their interests with the company's long-term growth objectives[91]. - The total pre-tax remuneration for the company's directors and executives amounted to 915.66 million[92]. - The company did not receive any objections from the board regarding company matters during the reporting period[97]. - The company has no current employee stock ownership plans or other incentive measures in place[107]. Shareholder Information - The total number of shareholders at the end of the reporting period was 299,410, an increase from 292,143 at the end of the previous month[162]. - The largest shareholder, Handan Iron and Steel Group Co., Ltd., holds 40.81% of the shares, totaling 4,218,763,010 shares[163]. - The company has issued corporate bonds, including the 2019 first phase bond with a balance of RMB 1.5 billion at an interest rate of 4.08%[173]. - The company’s shareholding structure remains stable with no significant changes in the top ten shareholders[163].

Group 1: Company Operations and Financial Performance - Steel prices have continued to decline in the second half of the year, leading to a general decrease in corporate profitability [1] - The company is focused on "cost reduction and price increase" to enhance profitability in the steel sector [1] - Production organization and control have been strengthened to improve production line stability [1] Group 2: Production Capacity and Projects - The company’s main production facilities are located in Tangshan, Handan, and Chengde, with limited impact from production restrictions this year [2] - The second phase of the Le Steel project has a production capacity of 4.05 million tons/year, with an estimated total investment of 26.3 billion yuan [2] - The project is expected to produce 2.46 million tons of molten iron and 2.25 million tons of converter steel upon completion [2] Group 3: Vanadium Products and Development - The company’s vanadium production capacity is currently 25,000 tons, with a focus on high-end vanadium-titanium products [2] - A new vanadium-titanium industrial park project is underway, aiming for a production capacity of 35,000 tons of basic vanadium products by 2030 [3] Group 4: Financial Compensation and Relocation - The Tangshan branch has received 17.681 billion yuan in relocation compensation, accounting for 52.94% of the total expected compensation [3] - The new base in Handan is projected to have an investment of 24.5 billion yuan, with iron and steel production capacities of 5.65 million tons and 4.7 million tons, respectively [3]

Group 1: Company Operations - The reason for the mining assets not being included in the listed company is due to continuous decline in mineral prices and the listed company's stock price being below net asset value [1] - The company's total mineral production in 2013 was approximately 7 million tons [2] - The current proportion of imported ore is between 60-70% [2] Group 2: Environmental Impact - Under environmental pressure, high-pollution industries face either rising costs or potential elimination; some companies that fail to invest in new environmental measures will be eliminated, while others that meet standards may benefit from economies of scale [2] - The company has made early investments in environmental protection, leading to a relatively large scale in waste utilization and creating new profit points through circular economy practices [2] Group 3: Acquisition and Production - The acquisition of Degao was completed at the group level, but there are currently no specific export plans [3] - The impact of APCE on the company has not been significant, and production has largely returned to pre-meeting levels [3]

Group 1: Production and Environmental Compliance - The company has not received any notifications regarding production restrictions related to the Tangshan Garden Expo, which may impact production by 50% if implemented [2] - Hebei Steel's Tangshan plant is recognized as a clean demonstration factory, fully compliant with national environmental standards [3] Group 2: Strategic Development and Market Position - The establishment of the vanadium-titanium subsidiary aims to leverage mature technology and government support in the rapidly growing energy storage sector [3] - The company plans to segment its assets from the steel main business and develop a comprehensive strategy in the vanadium-titanium field [3] Group 3: Supply-Side Reform and Industry Outlook - Supply-side reform in the steel industry focuses on capacity reduction, ending high pollution and disorderly competition, and improving supply structure and quality [3][4] - The government is committed to capacity reduction, with clear targets and reliance on market forces for implementation [4] Group 4: Industry Competition and Mergers - Short-term steel price rebounds may pressure capacity reduction, but the long-term trend indicates a shift towards quality and structural changes in the industry [4] - Mergers and acquisitions in the steel industry are expected to occur in the latter stages of capacity reduction, focusing on upstream and downstream channel integration rather than large-scale asset consolidation [4][5] Group 5: Management Practices - The company emphasizes strict financial control, avoiding new loans and centralizing fund management [5] - Adjustments in product structure and production line integration are key management strategies to enhance quality and cost control [5]

Group 1: Capacity Reduction - The company plans to eliminate iron capacity of 1.56 million tons and steel capacity of 2.86 million tons from 2016 to 2017 [1] - In 2016, the company completed a reduction of iron capacity by 520,000 tons and steel capacity by 1.66 million tons, with the remaining reductions to be completed by the end of September 2017 [2] Group 2: Impact on Production - In 2016, the steel output of Hebei Steel Group decreased by approximately 2.6% compared to 2015, primarily due to capacity reduction and environmental restrictions [2] Group 3: Employee Placement - All employees affected by capacity reduction will be internally reassigned within Hebei Steel Group, with no layoffs to the public, except for those retiring internally [2] Group 4: Provincial Capacity Reduction Targets - According to official information from the Hebei provincial government, the target for steel capacity reduction in 2017 is 15.62 million tons and for iron capacity is 16.24 million tons [2] Group 5: Relocation of Xuan Steel Company - Xuan Steel is scheduled to close by 2020, with capacity transfer projects set to begin construction by the end of April 2017, and production expected to start by June 2019 [2] Group 6: Product Composition and Sales - Currently, plate products account for about two-thirds of the company's steel products, with significant sales growth in automotive steel and home appliance plates in 2016 [2] Group 7: Vanadium Products - The company has a vanadium production capacity of 22,000 tons, with successful development of high-end vanadium products and entry into European and North American markets in 2016 [3] Group 8: Debt-to-Equity Plans - The company currently has no plans for debt-to-equity swaps [3]

Group 1: Capacity Reduction - The company plans to eliminate iron capacity of 1.56 million tons and steel capacity of 2.86 million tons from 2016 to 2017, in response to national and provincial capacity reduction requirements [1] - In 2016, the company completed the reduction of one 450m³ blast furnace and two 55t converters, reducing pig iron capacity by 520,000 tons and steelmaking capacity by 830,000 tons [1] - The remaining capacity reduction will be completed by the end of September 2017 as per requirements [1] Group 2: Vanadium-Titanium Product Development - The company has rich vanadium-titanium resources and advanced production processes in the vanadium-titanium technology field [2] - A vanadium-titanium subsidiary has been established to separate vanadium-titanium from the steel main business, focusing on research and industrial investment [2] - Significant breakthroughs were achieved in the development, testing, and production of high-purity vanadium powder and aerospace-grade vanadium-aluminum alloy in 2016 [2] Group 3: Iron Ore Import and Debt Management - Over 80% of the iron ore used in production is imported, with procurement managed by the international trade company of Hebei Iron and Steel Group [2] - The company is in discussions with financial institutions regarding the possibility of debt-to-equity swaps, but no results have been achieved yet [2] Group 4: Steel Product Exports - In 2016, the company's steel product exports decreased compared to 2015, primarily due to increased international trade friction and price factors [2] - The main export markets include Southeast Asia, Europe, the Middle East, and the United States [2] Group 5: Automotive Steel Production - The automotive steel produced by the company is primarily supplied to well-known enterprises such as Audi, Toyota, Hyundai, Dongfeng Peugeot, FAW, SAIC, and Great Wall [3] - The production volume of automotive steel in 2016 saw a significant increase compared to 2015, with the Handan branch achieving complete vehicle manufacturing [3]

Group 1: Capacity Reduction - The company plans to eliminate iron capacity of 1.56 million tons and steel capacity of 2.86 million tons between 2016 and 2017 [1] - In 2016, the company completed a reduction of 520,000 tons in iron capacity and 830,000 tons in steel capacity, with the remaining reductions scheduled to be completed by September 2017 [2] Group 2: Employee Placement - All employees affected by the capacity reduction will be internally reassigned within the Hebei Steel Group, with no layoffs directed towards the public [2] Group 3: Provincial Capacity Goals - The Hebei provincial government aims to reduce steel capacity by 15.62 million tons and iron capacity by 16.24 million tons in 2017 [2] Group 4: Product Sales Composition - The company's steel products consist of approximately two-thirds plates and one-third long products, with direct sales being the primary method of distribution [2] Group 5: Relocation of Xuan Steel - Xuan Steel is scheduled to cease operations by 2020, with capacity transfer projects set to begin construction in April 2017 and production expected to start by June 2019 [2]

[Important Notice, Table of Contents, and Definitions](index=2&type=section&id=%E7%AC%AC%E4%B8%80%E8%8A%82%20%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA%E3%80%81%E7%9B%AE%E5%BD%95%E5%92%8C%E9%87%8A%E4%B9%89) This section provides the important notice, table of contents, and definitions for the semi-annual report [Important Notice](index=2&type=section&id=%E9%87%8D%E8%A6%81%E6%8F%90%E7%A4%BA) The company's board of directors, supervisory board, and senior management ensure the truthfulness, accuracy, and completeness of this semi-annual report and assume legal responsibility, with all directors attending the review meeting. The company plans no profit distribution for the period, including no cash dividends, bonus shares, or capital increase from capital reserves - Company management guarantees the **truthfulness, accuracy, and completeness** of the report content, assuming corresponding legal responsibilities[2](index=2&type=chunk) - The company plans no cash dividends, no bonus shares, or no capital increase from capital reserves for the **2022 semi-annual period**[2](index=2&type=chunk) [Company Profile and Key Financial Indicators](index=5&type=section&id=%E7%AC%AC%E4%BA%8C%E8%8A%82%20%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 introduces the company and presents its key financial data and performance metrics for the reporting period [Company Profile](index=5&type=section&id=%E4%B8%80%E3%80%81%E5%85%AC%E5%8F%B8%E7%AE%80%E4%BB%8B) Hebei Iron & Steel Co., Ltd. (stock code: 000709) is a company listed on the Shenzhen Stock Exchange, with Wang Lanyu as its legal representative Company Information | Item | Content | | :--- | :--- | | Stock Abbreviation | HBIS | | Stock Code | 000709 | | Listing Exchange | Shenzhen Stock Exchange | | Legal Representative | Wang Lanyu | [Key Accounting Data and Financial Indicators](index=5&type=section&id=%E5%9B%9B%E3%80%81%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 the first half of 2022, the company's performance declined, with revenue decreasing by 4.05%, net profit attributable to shareholders by 35.98%, and non-recurring net profit by 54.32%, alongside a 40.74% reduction in net cash flow from operating activities Key Financial Performance | Key Financial Indicator | Current Period (CNY) | Prior Year Period (CNY) | YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 71,994,339,359.53 | 75,030,623,557.55 | -4.05% | | Net Profit Attributable to Shareholders | 973,805,813.49 | 1,521,137,569.20 | -35.98% | | Net Profit Attributable to Shareholders (Excluding Non-Recurring Items) | 689,761,725.89 | 1,509,987,206.57 | -54.32% | | Net Cash Flow from Operating Activities | 5,045,439,973.61 | 8,514,790,800.48 | -40.74% | | Basic Earnings Per Share (CNY/share) | 0.094 | 0.13 | -27.69% | | Weighted Average Return on Net Assets | 1.89% | 2.66% | -0.77% | | **Asset Indicators** | **Current Period End (CNY)** | **Prior Year End (CNY)** | **Change from Prior Year End** | | Total Assets | 242,377,520,849.58 | 243,419,433,508.61 | -0.43% | | Net Assets Attributable to Shareholders | 51,029,814,256.41 | 51,036,297,850.42 | -0.01% | [Non-Recurring Gains and Losses and Amounts](index=6&type=section&id=%E5%85%AD%E3%80%81%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) During the reporting period, the company's total non-recurring gains and losses amounted to CNY 284.04 million, primarily from net non-operating income and expenses, including CNY 26.71 million from government subsidies Non-Recurring Items | Item | Amount (CNY) | | :--- | :--- | | Gains/Losses from Disposal of Non-Current Assets | -869,222.00 | | Government Subsidies Recognized in Current Profit/Loss | 26,712,875.77 | | Net Other Non-Operating Income and Expenses | 355,256,515.72 | | **Total** | **284,044,087.60** | [Management Discussion and Analysis](index=8&type=section&id=%E7%AC%AC%E4%B8%89%E8%8A%82%20%E7%AE%A1%E7%90%86%E5%B1%82%E8%AE%A8%E8%AE%BA%E4%B8%8E%E5%88%86%E6%9E%90) This section provides an in-depth analysis of the company's operations, financial condition, and future outlook, including key business activities, competitive advantages, and risk factors [Principal Business](index=8&type=section&id=%E4%B8%80%E3%80%81%E6%8A%A5%E5%91%8A%E6%9C%9F%E5%86%85%E5%85%AC%E5%8F%B8%E4%BB%8E%E4%BA%8B%E7%9A%84%E4%B8%BB%E8%A6%81%E4%B8%9A%E5%8A%A1) In the first half of 2022, the company primarily engaged in the production and sale of high-quality steel and vanadium-titanium products, with an annual capacity of 30 million tons of steel and 22,000 tons of vanadium products, serving various high-end sectors - In H1 2022, the steel industry faced challenges including a **6.5% decline in crude steel output**, lower-than-expected market demand, falling steel prices, and high raw material costs, leading to a significant decline in industry profitability[14](index=14&type=chunk) - The company's main businesses are steel and vanadium-titanium products, with an annual production capacity of **30 million tons of high-quality steel** and **22,000 tons of vanadium products**, serving high-end markets such as automotive, home appliances, construction, aerospace, and new energy[14](index=14&type=chunk) [Core Competitiveness Analysis](index=8&type=section&id=%E4%BA%8C%E3%80%81%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 competitiveness stems from its advanced process equipment, rich product structure, leadership in energy conservation and green transformation, strong technological innovation, and strategic geographical location in North China - The company possesses **world-leading process equipment**, including the world's first "sub-molten salt method for efficient vanadium extraction and clean production line," offering a rich product structure renowned domestically and internationally[15](index=15&type=chunk) - The company has achieved significant results in green development, with its **ultra-low emission control technology for multiple steel pollutants** recognized, and Laoting Steel Co. rated as an A-level environmental performance enterprise[16](index=16&type=chunk) - The company's technological advantages are prominent, with several high-end products like **high-strength galvanized steel** and **thick-zinc-layer galvanized sheets** filling domestic gaps, and it has received multiple awards including the National Science and Technology Progress First Prize[17](index=17&type=chunk)[18](index=18&type=chunk) - Located in North China, the company benefits from its proximity to Beijing-Tianjin and the Bohai Sea, allowing it to fully capitalize on development opportunities arising from **Beijing-Tianjin-Hebei coordinated development** and the construction of Xiong'an New Area[19](index=19&type=chunk) [Main Business Analysis](index=9&type=section&id=%E4%B8%89%E3%80%81%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%8A%A1%E5%88%86%E6%9E%90) In H1 2022, the company's operating revenue decreased by 4.05% to CNY 71.99 billion, and net profit attributable to shareholders fell by 35.98% to CNY 974 million, with steel products, particularly plates, remaining the primary revenue source Production Indicators | Production Indicator | H1 2022 Output | | :--- | :--- | | Pig Iron Production | 14.36 million tons | | Crude Steel Production | 13.83 million tons | | Steel Product Production | 13.10 million tons | | Vanadium Slag Production | 79,200 tons | Key Financial Data | Key Financial Data | Current Period (CNY) | Prior Year Period (CNY) | YoY Change | Main Reasons for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 71,994,339,359.53 | 75,030,623,557.55 | -4.05% | - | | Income Tax Expense | 237,350,552.60 | 503,620,776.79 | -52.87% | Lower operating profit this year | | Net Cash Flow from Operating Activities | 5,045,439,973.61 | 8,514,790,800.48 | -40.74% | Decreased cash inflow due to price decline | | Net Cash Flow from Investing Activities | -683,279,491.59 | -3,185,402,448.78 | -78.55% | Reduced long-term asset expenditures | | Net Cash Flow from Financing Activities | -4,756,051,894.51 | 765,208,122.00 | -721.54% | Increased repayment of financing | Revenue Composition (by Product) | Revenue Composition (by Product) | Current Period Revenue (CNY) | Proportion | YoY Change | | :--- | :--- | :--- | :--- | | Plates | 48,342,551,923.78 | 67.15% | -8.18% | | Bars and Sections | 10,019,740,428.10 | 13.92% | 9.07% | | Wire Rods, Strips, etc. | 3,187,861,608.84 | 4.43% | 61.94% | | Vanadium Products | 905,193,816.80 | 1.26% | 21.64% | [Non-Principal Business Analysis](index=11&type=section&id=%E5%9B%9B%E3%80%81%E9%9D%9E%E4%B8%BB%E8%90%A5%E4%B8%9A%E5%88%86%E6%9E%90) Non-principal business activities significantly impacted total profit during the reporting period, with investment income and non-operating income contributing 26.40% and 27.55% respectively, and investment income from associates being sustainable Impact of Non-Principal Business on Total Profit | Item | Amount (CNY) | Proportion of Total Profit | Reason for Formation | Sustainability | | :--- | :--- | :--- | :--- | :--- | | Investment Income | 348,110,708.98 | 26.40% | Profit from associate companies | Yes | | Non-Operating Income | 363,227,623.64 | 27.55% | - | No | [Assets and Liabilities Analysis](index=11&type=section&id=%E4%BA%94%E3%80%81%E8%B5%84%E4%BA%A7%E5%8F%8A%E8%B4%9F%E5%80%BA%E7%8A%B6%E5%86%B5%E5%88%86%E6%9E%90) As of the reporting period end, total assets slightly decreased by 0.43% to CNY 242.38 billion, with fixed assets being the largest component and construction in progress increasing, while short-term borrowings constituted the primary liability - Construction in progress as a percentage of total assets increased from **8.71%** at the end of the previous year to **11.04%**, indicating ongoing investment activities by the company[28](index=28&type=chunk) Restricted Assets | Restricted Asset Item | Restricted Amount (CNY) | Reason for Restriction | | :--- | :--- | :--- | | Monetary Funds | 9,223,532,701.78 | Letter of credit margin, bill margin | | Fixed Assets | 10,600,023,719.30 | Finance lease assets | | Intangible Assets | 11,883,726.88 | Mortgage loan | | **Total** | **19,835,440,147.96** | - | [Analysis of Major Holding and Associate Companies](index=13&type=section&id=%E5%85%AB%E3%80%81%E4%B8%BB%E8%A6%81%E6%8E%A7%E8%82%A1%E5%8F%82%E8%82%A1%E5%85%AC%E5%8F%B8%E5%88%86%E6%9E%90) During the reporting period, the company's major subsidiaries, primarily engaged in steel and billet processing, all achieved profitability, with Hebei Laoting Iron & Steel Co., Ltd. being the top performer in revenue and net profit Major Subsidiaries' Performance | Company Name | Type | Operating Revenue (CNY) | Net Profit (CNY) | | :--- | :--- | :--- | :--- | | Handan Baosteel Co. | Subsidiary | 16,840,547,389.02 | 60,002,981.91 | | Medium-Thick Plate Co. | Subsidiary | 8,200,954,622.13 | 18,073,038.64 | | Hebei Laoting Iron & Steel Co., Ltd. | Subsidiary | 15,903,025,562.73 | 168,373,409.47 | [Risks and Countermeasures](index=14&type=section&id=%E5%8D%81%E3%80%81%E5%85%AC%E5%8F%B8%E9%9D%A2%E4%B8%B4%E7%9A%84%E9%A3%8E%E9%99%A9%E5%92%8C%E5%BA%94%E5%AF%B9%E6%8E%AA%E6%96%BD) The company faces significant environmental, operational, and financial risks, including production restrictions due to environmental regulations, declining steel prices amidst high raw material costs, and a high asset-liability ratio, for which it has developed corresponding mitigation strategies - The company faces key risks including: - **Environmental Protection Risk**: Located in the key air pollution control area of Beijing-Tianjin-Hebei, facing production restrictions during heavy pollution and challenges from "carbon peaking and carbon neutrality" initiatives - **Operational Risk**: Dual pressure from continuously falling steel prices and high raw material costs - **Financial Risk**: High asset-liability ratio, susceptible to changes in national credit policies[37](index=37&type=chunk)[38](index=38&type=chunk) - Company countermeasures include: - **Environmental**: Optimizing production organization under restricted output, accelerating ultra-low emission upgrades, and researching carbon emission policies - **Operational**: Deepening efficiency improvements, optimizing product structure, and strengthening strategic cooperation with suppliers to reduce procurement costs - **Financial**: Enhancing integrated capital management, adjusting debt structure through various financing methods, and ensuring cash flow safety[37](index=37&type=chunk)[38](index=38&type=chunk) [Corporate Governance](index=15&type=section&id=%E7%AC%AC%E5%9B%9B%E8%8A%82%20%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86) This section outlines the company's corporate governance structure and activities, including shareholder meetings, management stability, and profit distribution policies [Overview of Corporate Governance](index=15&type=section&id=%E5%85%AC%E5%8F%B8%E6%B2%BB%E7%90%86%E6%A6%82%E5%86%B5) During the reporting period, the company held two shareholder meetings, maintained stable board and management personnel, and decided against semi-annual profit distribution or equity incentive plans - Two shareholder meetings were held during the reporting period: the **2022 First Extraordinary General Meeting** and the **2021 Annual General Meeting**[39](index=39&type=chunk) - There were **no changes** in the company's directors, supervisors, or senior management during the reporting period[39](index=39&type=chunk) - The company's semi-annual profit distribution plan is **no cash dividends, no bonus shares, and no capital increase from capital reserves**[40](index=40&type=chunk) [Environmental and Social Responsibility](index=16&type=section&id=%E7%AC%AC%E4%BA%94%E8%8A%82%20%E7%8E%AF%E5%A2%83%E5%92%8C%E7%A4%BE%E4%BC%9A%E8%B4%A3%E4%BB%BB) This section details the company's environmental performance, including its status as a key pollutant emitter, compliance with emission standards, and efforts in pollution control and carbon reduction, along with its social responsibility initiatives [Major Environmental Issues](index=16&type=section&id=%E4%B8%80%E3%80%81%E9%87%8D%E5%A4%A7%E7%8E%AF%E4%BF%9D%E9%97%AE%E9%A2%98%E6%83%85%E5%86%B5) The company and its subsidiaries are designated key pollutant emitters, but all emissions comply with ultra-low standards, with no exceedances reported, and the company actively implements environmental protection measures and emergency plans - The company and its subsidiaries (e.g., Hebei Laoting, Medium-Thick Plate Co., Handan Branch) are classified as **key pollutant-discharging entities**, with primary pollutants being particulate matter, sulfur dioxide, and nitrogen oxides[42](index=42&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk) - During the reporting period, pollutant emission concentrations and total amounts for all units were **within the approved emission standards**, with no instances of exceeding limits[42](index=42&type=chunk)[43](index=43&type=chunk)[44](index=44&type=chunk) - The company actively promotes environmental governance; Laoting Steel Co.'s air pollution control facilities fully meet **ultra-low emission requirements**, and multiple comprehensive air pollution control projects have been implemented. All subsidiaries have obtained pollution discharge permits and established emergency response plans for environmental incidents[46](index=46&type=chunk)[48](index=48&type=chunk) - To reduce carbon emissions, the company employs technical measures such as **sintering flue gas recirculation** and **new energy vehicle substitution**[49](index=49&type=chunk) [Significant Matters](index=22&type=section&id=%E7%AC%AC%E5%85%AD%E8%8A%82%20%E9%87%8D%E8%A6%81%E4%BA%8B%E9%A1%B9) This section covers important events and ongoing commitments, including the fulfillment of past promises, significant related-party transactions, and other material developments [Fulfillment of Commitments](index=22&type=section&id=%E4%B8%80%E3%80%81%E6%89%BF%E8%AF%BA%E4%BA%8B%E9%A1%B9%E5%B1%A5%E8%A1%8C%E6%83%85%E5%86%B5) During the reporting period, the controlling shareholder, HBIS Group, and related parties continued to fulfill historical commitments regarding avoiding horizontal competition and land/property rights, stemming from the 2010 asset restructuring - HBIS Group's long-term commitment to resolve horizontal competition with the listed company through **asset injection, entrusted management**, and other means is currently ongoing[51](index=51&type=chunk) [Significant Related-Party Transactions](index=24&type=section&id=%E5%8D%81%E4%B8%80%E3%80%81%E9%87%8D%E5%A4%A7%E5%85%B3%E8%81%94%E4%BA%A4%E6%98%93) The company engaged in significant daily related-party transactions totaling CNY 71.86 billion in H1 2022, primarily for raw material procurement and product sales, remaining within the approved annual limit, and maintained substantial deposits with an affiliated finance company - In H1 2022, the company's total daily related-party transactions amounted to **CNY 71.86 billion**, approximately **49.9%** of the annual approved limit of CNY 144.055 billion, primarily involving the procurement and sale of steel, ore, coke, and other raw materials and products[53](index=53&type=chunk)[54](index=54&type=chunk) Related-Party Financial Company Transactions | Related-Party Financial Company Transactions | Period-End Balance (CNY 10,000) | | :--- | :--- | | Deposit Business | 1,116,505.61 | | Loan Business | 0 | | Actual Credit Line Utilization | 190,763 | [Other Significant Matters](index=26&type=section&id=%E5%8D%81%E4%B8%89%E3%80%81%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) As of the reporting period end, the company received CNY 14.17 billion in compensation for the Tangshan Branch relocation, representing 42.42% of the total due, with delayed land disposal leading to a slower collection pace and triggering penalty payments - Compensation for the Tangshan Branch relocation totaled **CNY 14.17 billion** received, representing **42.42%** of the total amount due, with collection progress lagging behind the original schedule[61](index=61&type=chunk) [Share Changes and Shareholder Information](index=28&type=section&id=%E7%AC%AC%E4%B8%83%E8%8A%82%20%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 the company's share capital structure, any changes during the period, and information on its shareholders, including the total number of shareholders and major holdings [Share Changes](index=28&type=section&id=%E4%B8%80%E3%80%81%E8%82%A1%E4%BB%BD%E5%8F%98%E5%8A%A8%E6%83%85%E5%86%B5) As of the reporting period end, the company's total share capital remained unchanged at 10,618,607,852 shares, with unrestricted shares accounting for 99.98% - The company's total share capital remained **unchanged** at **10,618,607,852 shares** during the reporting period[64](index=64&type=chunk) [Shareholder Numbers and Shareholding Structure](index=29&type=section&id=%E4%B8%89%E3%80%81%E5%85%AC%E5%8F%B8%E8%82%A1%E4%B8%9C%E6%95%B0%E9%87%8F%E5%8F%8A%E6%8C%81%E8%82%A1%E6%83%85%E5%86%B5) As of the reporting period end, the company had 286,258 common shareholders, with the top three shareholders, all state-owned legal entities, collectively holding over 61% of the shares, led by Handan Iron & Steel Group Co., Ltd. at 39.73% Top Shareholders | Shareholder Name | Shareholder Nature | Shareholding Proportion | | :--- | :--- | :--- | | Handan Iron & Steel Group Co., Ltd. | State-owned Legal Entity | 39.73% | | Tangshan Iron & Steel Group Co., Ltd. | State-owned Legal Entity | 17.45% | | Chengde Iron & Steel Group Co., Ltd. | State-owned Legal Entity | 4.07% | | Hong Kong Securities Clearing Company Limited | Overseas Legal Entity | 1.70% | | China Securities Finance Corporation Limited | Domestic Non-State-owned Legal Entity | 1.24% | - Handan Iron & Steel Group, Tangshan Iron & Steel Group, Chengde Iron & Steel Group, and Hebei Iron & Steel Group Mining Co., Ltd. among the top ten shareholders are **related parties**, all controlled by HBIS Group Co., Ltd[68](index=68&type=chunk) [Bond-Related Information](index=32&type=section&id=%E7%AC%AC%E4%B9%9D%E8%8A%82%20%E5%80%BA%E5%88%B8%E7%9B%B8%E5%85%B3%E6%83%85%E5%86%B5) This section provides details on the company's outstanding corporate and enterprise bonds, including their balances, interest rates, maturity dates, and an analysis of key financial indicators related to debt [Enterprise Bonds](index=32&type=section&id=%E4%B8%80%E3%80%81%E4%BC%81%E4%B8%9A%E5%80%BA%E5%88%B8) As of the reporting period end, the company had one outstanding enterprise bond, "18 HBIS G1," with a balance of CNY 700 million and an interest rate of 5.42%, maturing on March 26, 2023 Outstanding Enterprise Bonds | Bond Abbreviation | Bond Code | Bond Balance (CNY) | Interest Rate | Maturity Date | | :--- | :--- | :--- | :--- | :--- | | 18 HBIS G1 | 111071 | 700,000,000.00 | 5.42% | 2023-03-26 | [Corporate Bonds](index=32&type=section&id=%E4%BA%8C%E3%80%81%E5%85%AC%E5%8F%B8%E5%80%BA%E5%88%B8) As of the reporting period end, the company had five outstanding corporate bonds totaling CNY 7.5 billion, including four regular corporate bonds and one newly issued perpetual bond, "22 HBIS Y1," in July 2022 Outstanding Corporate Bonds | Bond Abbreviation | Bond Code | Bond Balance (CNY) | Interest Rate | Maturity Date | | :--- | :--- | :--- | :--- | :--- | | 19 HBIS 01 | 112999 | 1,500,000,000.00 | 4.08% | 2024-11-26 | | 19 HBIS 02 | 149011 | 1,500,000,000.00 | 4.11% | 2024-12-12 | | 20HBIS01 | 149099 | 1,500,000,000.00 | 3.38% | 2025-04-20 | | 20HBIS02 | 149181 | 1,500,000,000.00 | 4.20% | 2025-07-30 | | 22 HBIS Y1 | 149971 | 1,500,000,000.00 | 3.40% | 2024-07-05 | [Key Financial Indicators for the Past Two Years](index=34&type=section&id=%E5%85%AD%E3%80%81%E6%88%AA%E8%87%B3%E6%8A%A5%E5%91%8A%E6%9C%AB%E5%85%AC%E5%8F%B8%E8%BF%91%E4%B8%A4%E5%B9%B4%E7%9A%84%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) As of the reporting period end, the company's asset-liability ratio was 74.31%, a 0.67 percentage point decrease from the previous year-end, while interest coverage ratios declined, indicating increased short-term debt pressure Key Financial Indicators | Item | Current Period End/Current Period | Prior Year End/Prior Year Period | Change | | :--- | :--- | :--- | :--- | | Asset-Liability Ratio | 74.31% | 74.98% | -0.67% | | Interest Coverage Ratio | 1.42 | 1.66 | -14.46% | | Cash Interest Coverage Ratio | 2.94 | 4.34 | -32.26% | | Loan Repayment Rate | 100.00% | 100.00% | 0.00% | [Financial Report](index=35&type=section&id=%E7%AC%AC%E5%8D%81%E8%8A%82%20%E8%B4%A2%E5%8A%A1%E6%8A%A5%E5%91%8A) This section presents the company's unaudited semi-annual financial statements, including the balance sheets, income statements, cash flow statements, and statements of changes in owners' equity for both consolidated and parent company levels, along with detailed notes [Audit Report](index=35&type=section&id=%E4%B8%80%E3%80%81%E5%AE%A1%E8%AE%A1%E6%8A%A5%E5%91%8A) The company's 2022 semi-annual financial report was not audited - The company's semi-annual financial report was **unaudited**[79](index=79&type=chunk) [Financial Statements](index=35&type=section&id=%E4%BA%8C%E3%80%81%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8) This section provides the company's key financial statements for the first half of 2022, including consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity [Consolidated Balance Sheet](index=35&type=section&id=1%E3%80%81%E5%90%88%E5%B9%B6%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8) [Parent Company Balance Sheet](index=37&type=section&id=2%E3%80%81%E6%AF%8D%E5%85%AC%E5%8F%B8%E8%B5%84%E4%BA%A7%E8%B4%9F%E5%80%BA%E8%A1%A8) [Consolidated Income Statement](index=39&type=section&id=3%E3%80%81%E5%90%88%E5%B9%B6%E5%88%A9%E6%B6%A6%E8%A1%A8) [Parent Company Income Statement](index=40&type=section&id=4%E3%80%81%E6%AF%8D%E5%85%AC%E5%8F%B8%E5%88%A9%E6%B6%A6%E8%A1%A8) [Consolidated Cash Flow Statement](index=41&type=section&id=5%E3%80%81%E5%90%88%E5%B9%B6%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) [Parent Company Cash Flow Statement](index=42&type=section&id=6%E3%80%81%E6%AF%8D%E5%85%AC%E5%8F%B8%E7%8E%B0%E9%87%91%E6%B5%81%E9%87%8F%E8%A1%A8) [Consolidated Statement of Changes in Owners' Equity](index=43&type=section&id=7%E3%80%81%E5%90%88%E5%B9%B6%E6%89%80%E6%9C%89%E8%80%85%E6%9D%83%E7%9B%8A%E5%8F%98%E5%8A%A8%E8%A1%A8) [Parent Company Statement of Changes in Owners' Equity](index=48&type=section&id=8%E3%80%81%E6%AF%8D%E5%85%AC%E5%8F%B8%E6%89%80%E6%9C%89%E8%80%85%E6%9D%83%E7%9B%8A%E5%8F%98%E5%8A%A8%E8%A1%A8) [Notes to Financial Statements](index=52&type=section&id=%E8%B4%A2%E5%8A%A1%E6%8A%A5%E8%A1%A8%E9%99%84%E6%B3%A8) The notes to the financial statements detail the company's general information, basis of preparation, significant accounting policies and estimates, taxation, and provide comprehensive explanations for major consolidated financial statement items, related party disclosures, contingencies, and other significant matters