PETROCHINA(00857)2024-04-23 08:57Corporate Governance and Board Activities - The Board of Directors' Sustainability Committee held 2 meetings during the reporting period, reviewing the company's 2022 ESG report and health safety environmental report, and forming committee resolutions[1] - The company's Supervisory Committee consists of 8 members, including 4 shareholder representatives and 4 employee representatives. The committee held 5 meetings during the reporting period, reviewing the company's 2022 annual report and quarterly reports for 2023[4] - The Supervisory Committee attended 4 Board meetings and submitted 4 proposals to the shareholders' meetings, providing oversight on the company's financials and the performance of directors and senior management[4][5] - The company held 4 shareholders' meetings in 2023, approving 9 ordinary proposals and 3 special proposals, including the 2022 financial report, profit distribution plan, and board authorization for share repurchase[20][21] - Shareholders holding 10% or more of the company's voting shares can request the Board to convene an extraordinary general meeting, and if the Board does not respond within 10 days, they can request the Supervisory Committee to convene the meeting[14][15] - The company's independent directors attended all shareholders' meetings and did not raise any objections to the resolutions passed[22] - The Board is responsible for preparing the company's annual financial statements in accordance with international financial reporting standards and Chinese accounting standards, ensuring true and fair reporting of the company's status[7] - The Board believes the company has sufficient resources to continue as a going concern in the foreseeable future, and the financial statements are prepared on a going concern basis[8] - Shareholders can submit written inquiries to the Board, and the company provides a Q&A session during shareholders' meetings, with written questionnaires available for shareholders who cannot attend[19] - The company's risk management and internal control details can be found in the "Corporate Governance Improvement" and "Internal Control System Improvement" sections of the annual report[10] - The company's board of supervisors submitted several proposals to the 2023 shareholders' meeting, including the 2022 Supervisory Committee Report and proposals on the appointment of auditors and the election of supervisors[79] - The company's board of supervisors reviewed and approved the company's compliance with laws and regulations, financial status, and environmental, social, and governance (ESG) practices in 2023[81][84] - The company's board of supervisors noted that all related party transactions in 2023 were conducted within approved limits and in compliance with regulatory requirements[83] Executive and Board Compensation - The company's board of directors includes Chairman Dai Houliang, Vice Chairman Hou Qijun, and other key executives, with total pre-tax compensation for 2023 ranging from 597,000 RMB to 1,502,000 RMB for non-independent directors[86] - The company's board of supervisors includes members such as Xie Haibing and Zhao Ying, with total pre-tax compensation for 2023 ranging from 906,000 RMB to 1,389,000 RMB for employee representatives[70] - The company's independent non-executive directors, including Jiang Xiaoming and Xiong Lushan, receive fixed salaries and meeting allowances, with compensation levels set based on market conditions and industry benchmarks[86] - The company's total pre-tax compensation for senior management in 2023 was 1,655 thousand RMB for the Safety Director, 432 thousand RMB for the Vice President and Chief Engineer, and 1,571 thousand RMB for the Vice President (including compensation from January to June as a supervisor and from June to December as Vice President)[97][102][104] - The company's total pre-tax compensation for employee representatives in 2023 was 357 thousand RMB for one supervisor and 1,571 thousand RMB for another (including compensation from January to June as a supervisor and from June to December as Vice President)[97][109] - The company's senior management, including Vice Presidents Zhu Guowen, Wan Jun, Wang Hua, Li Ruxin, He Jiangchuan, and Chief Geologist Jiang Tongwen, received pre-tax remuneration ranging from 867 to 1,597 thousand RMB in 2023[110] Financial Performance and Reporting - Revenue for Q1 2023 was RMB 732.471 billion, Q2 was RMB 747.4 billion, Q3 was RMB 802.264 billion, and Q4 was RMB 728.877 billion[148] - Net profit attributable to shareholders in Q1 2023 was RMB 43.63 billion, Q2 was RMB 41.646 billion, Q3 was RMB 46.375 billion, and Q4 was RMB 29.493 billion[148] - Operating cash flow for Q1 2023 was RMB 126.382 billion, Q2 was RMB 95.324 billion, Q3 was RMB 119.294 billion, and Q4 was RMB 115.596 billion[148] - Non-recurring losses for 2023 totaled RMB 25.986 billion, including RMB 11.325 billion from disposal of non-current assets and RMB 19.238 billion from tax and accounting adjustments[149] - The company proposed a final dividend of RMB 0.23 per share for 2023, totaling approximately RMB 42.095 billion[157] - The company's total share capital as of December 31, 2023, was 183,020,977,818 shares[157] - Revenue for 2023 reached RMB 3,011,012 million, a decrease of 7.0% compared to RMB 3,239,167 million in 2022[171] - Net profit attributable to parent company shareholders in 2023 was RMB 161,146 million, up 8.3% from RMB 148,743 million in 2022[171] - Total assets increased to RMB 2,752,448 million in 2023, up 3.1% from RMB 2,670,400 million in 2022[171] - Capital expenditures in 2023 amounted to RMB 275,338 million, slightly higher than RMB 274,307 million in 2022[171] - Net cash flow from operating activities in 2023 was RMB 456,596 million, a 16.0% increase from RMB 393,768 million in 2022[171] - The company's net profit under International Financial Reporting Standards (IFRS) was RMB 180,293 million, while under Chinese Accounting Standards, it was RMB 180,291 million, with a minimal difference of RMB 0.02 million[175] - The company's return on equity (ROE) for 2023 was 11.1%, up from 10.9% in 2022[171] - The company's total equity increased to RMB 1,630,373 million in 2023, up 6.3% from RMB 1,534,166 million in 2022[171] - Revenue for 2023 decreased by 7.0% to RMB 3,011,012 million compared to 2022[200] - Net profit attributable to parent company shareholders increased by 8.3% to RMB 161,144 million in 2023[200] - Operating cash flow increased by 16.0% to RMB 456,596 million in 2023[200] - Basic earnings per share increased by 8.3% to RMB 0.88 in 2023[200] - Total assets increased by 3.1% to RMB 2,752,710 million at the end of 2023[200] - Equity attributable to parent company shareholders increased by 5.9% to RMB 1,446,410 million at the end of 2023[200] Shareholder Information and Ownership - The company's total number of shareholders as of December 31, 2023, was 479,245, with 473,714 domestic A-share holders and 5,531 overseas H-share holders[178] - China National Petroleum Corporation (CNPC) holds 82.46% of the company's shares, totaling 150,923,565,570 shares, an increase of 3,819,948,462 shares during the reporting period[180] - China National Petroleum Corporation holds 82.46% of the total share capital[186] - BlackRock, Inc. holds 0.80% of the total share capital through H-shares[186] Business Operations and Strategy - The company's main businesses include exploration, production, and sales of crude oil and natural gas, as well as new energy and materials businesses[140] - The company is listed on the Shanghai Stock Exchange (A-share code: 601857) and the Hong Kong Stock Exchange (H-share code: 857)[142] - The company's registered office is located at No. 16 Ande Road, Dongcheng District, Beijing, China[142] - The company's financial reports are audited by PricewaterhouseCoopers Zhong Tian LLP in China and PricewaterhouseCoopers in Hong Kong[142] - The company expects China's GDP growth target to be around 5% in 2024[195] - The company plans to accelerate the development of new energy and new materials businesses in 2024[195] Executive and Board Member Backgrounds - The company's independent non-executive directors, Jiang Xiaoming and Xiong Lushan, have extensive experience in investment management and corporate governance, with Jiang holding a PhD in Economics from the University of Cambridge and Xiong having a background in tax advisory services[66][67] - The company's current Chairman, Dai Houliang, is 60 years old and holds a Ph.D. in Engineering. He has extensive experience in the petroleum industry, including roles at Sinopec and China National Petroleum Corporation (CNPC)[87] - Huang Yongzhang, aged 57, serves as the company's President and is a senior engineer with a Ph.D. He has held various leadership positions within CNPC, including roles in international operations and safety management[87] - Hou Qijun, aged 57, is the Vice Chairman of the company and holds a Ph.D. in Engineering. He has a strong background in oil and gas exploration and production, having served in multiple senior roles within CNPC[87] - Ren Lixin, aged 56, is a Senior Vice President and holds a Ph.D. in Engineering. He has extensive experience in the refining and chemical sectors, having served in various leadership roles within CNPC[87] - Xie Jun, aged 56, is a Director and holds a Ph.D. in Engineering. He has a strong background in natural gas and pipeline operations, having served in multiple senior roles within CNPC[87] - Zhang Daowei, aged 51, is a Senior Vice President and holds a Ph.D. in Engineering. He has extensive experience in oil and gas exploration and production, having served in various leadership roles within CNPC[87] - Cai Jinyong, aged 64, is an Independent Non-Executive Director with a Ph.D. in Economics. He has over 30 years of experience in the financial services industry, including roles at Goldman Sachs and Morgan Stanley[89] - Zhang Laibin, aged 62, is an Independent Non-Executive Director and a professor at China University of Petroleum (Beijing). He holds a Ph.D. and is a member of the Chinese Academy of Engineering[90] - He Jinglin, aged 48, is an Independent Non-Executive Director with a Ph.D. He has extensive experience in the banking and investment sectors, including roles at Macau Tai Fung Bank and Asia Pioneer Entertainment Holdings[91] - The company's executive directors and senior management have a strong background in engineering and petroleum industry, with most holding Ph.D. degrees and having extensive experience in various leadership roles within CNPC[87][89][90][91] - In 2023, the company underwent a board and senior management reshuffle, with several key positions including Executive Director, Chief Geologist, and Independent Non-Executive Directors being replaced due to term limits or age reasons[105] - Shen Fuxiao was appointed as the company's Safety Director in March 2024 and will receive remuneration from the company[111] - He Jiangchuan, Vice President, has been serving as the Executive Director of the Oil, Gas, and New Energy Division since May 2023[113] - Jiang Tongwen, Chief Geologist, has been the General Manager of the Science and Technology Management Department since June 2022[113] - Yang Weisheng, Chief Engineer, has been the Executive Director and President of the Petrochemical Research Institute since June 2022[113] - Shen Fuxiao, Safety Director, also serves as the Deputy Safety Director of China National Petroleum Corporation and General Manager of the Quality, Health, Safety, and Environmental Protection Department[113] - Tian Jinghui resigned as Vice President due to age reasons on January 6, 2023[116] Financial Reporting and Auditing - The company's financial reports for 2023 were prepared in accordance with both Chinese Accounting Standards and International Financial Reporting Standards and were audited by PricewaterhouseCoopers Zhong Tian LLP and PricewaterhouseCoopers[129] - The company's registered Chinese name is China National Petroleum Corporation, with Dai Houliang as the legal representative[131][132] - The company's contact address is 9 Dongzhimen North Street, Dongcheng District, Beijing, China, with a fax number of 86(10) 6209 9557 and a phone number of 86(10) 5998 2622[133][134][136] Risk Management and Exchange Rate Impact - The company's financial performance is subject to exchange rate risk due to its operations in both RMB and foreign currencies, with potential impacts from fluctuations in the RMB exchange rate[76]