首钢资源(00639) - 2021 - 中期财报

Corporate Information This section details the company's board of directors, committee members, and other essential corporate information - The report provides a list of members for the company's board of directors and various committees (executive, audit, nomination, remuneration), along with key corporate information such as the company secretary, auditor, share registrar, and registered office[4][5] Financial Highlights The company reported strong revenue and profit growth for the first half of 2021, maintaining a robust financial position Operating Summary for the Six Months Ended June 30, 2021 | Indicator | H1 2021 | H1 2020 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue (HKD million) | 2,444 | 1,820 | +34% | | Gross Profit (HKD million) | 1,218 | 948 | +28% | | Gross Margin (%) | 50% | 52% | -2pp | | Adjusted Gross Margin¹ (%) | 54% | 52% | +2pp | | Profit for the Period (HKD million) | 774 | 585 | +32% | | Profit Attributable to Owners (HKD million) | 673 | 549 | +23% | | EBITDA² (HKD million) | 1,358 | 1,027 | +32% | | Basic Earnings Per Share (HK cents) | 13.33 | 10.35 | +29% | | Interim Dividend Per Share (HK cents) | 8.00 | 7.50 | +7% | Financial Position Summary as of June 30, 2021 | Indicator | As of June 30, 2021 | As of December 31, 2020 | Period Change | | :--- | :--- | :--- | :--- | | Total Assets (HKD million) | 22,752 | 21,434 | +6% | | Of which: Cash and Deposits (HKD million) | 4,784 | 4,062 | +18% | | Total Liabilities (HKD million) | 4,754 | 4,143 | +15% | | Total Equity (HKD million) | 17,998 | 17,291 | +4% | | Equity Attributable to Owners (HKD million) | 16,408 | 15,387 | +7% | | Current Ratio (times) | 2.58 | 2.77 | -7% | | Gearing Ratio (%) | 0.03% | – | N/A | Report on Review of Interim Financial Information The interim financial information has been reviewed by PwC, concluding that it is prepared in accordance with HKAS 34 - PricewaterhouseCoopers, the auditor, has reviewed the interim financial information in accordance with Hong Kong Standard on Review Engagements 2410[13] - The review concluded that the auditor found no matters to suggest the interim financial information was not prepared in all material respects in accordance with Hong Kong Accounting Standard 34 'Interim Financial Reporting'[14][16] Condensed Consolidated Financial Statements This section presents the condensed consolidated financial statements, including profit or loss, financial position, equity changes, and cash flows Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income During the period, revenue increased by 34% year-on-year to HKD 2.44 billion, driven by higher sales volume and prices, with profit attributable to owners growing by 23% to HKD 673 million Key Profit or Loss Statement Data | Item | H1 2021 (HKD thousand) | H1 2020 (HKD thousand) | | :--- | :--- | :--- | | Revenue | 2,444,193 | 1,819,727 | | Gross Profit | 1,217,762 | 948,433 | | Profit Before Income Tax | 1,056,369 | 802,617 | | Profit for the Period | 773,609 | 584,935 | | Profit Attributable to Owners | 673,389 | 548,699 | Condensed Consolidated Statement of Financial Position As of June 30, 2021, total assets increased to HKD 22.75 billion, with total liabilities at HKD 4.75 billion and net assets at HKD 17.99 billion, demonstrating a robust financial position Key Financial Position Statement Data | Item | As of June 30, 2021 (HKD thousand) | As of December 31, 2020 (HKD thousand) | | :--- | :--- | :--- | | Total Non-current Assets | 14,889,914 | 14,532,147 | | Total Current Assets | 7,861,809 | 6,901,499 | | Total Assets | 22,751,723 | 21,433,646 | | Total Current Liabilities | 3,050,742 | 2,488,195 | | Total Non-current Liabilities | 1,702,806 | 1,654,381 | | Net Assets | 17,998,175 | 17,291,070 | Condensed Consolidated Statement of Changes in Equity As of June 30, 2021, total equity attributable to owners increased to HKD 16.41 billion, driven by profit for the period and other comprehensive income, partially offset by dividends - Total comprehensive income for the period was HKD 1.16 billion, with HKD 1.03 billion attributable to owners[26] - The company approved and recognized a final dividend of approximately HKD 455 million for 2020 during the period, deducted from retained earnings[26] Condensed Consolidated Statement of Cash Flows Net cash inflow from operating activities significantly increased to HKD 1.05 billion, while investing activities resulted in a net outflow of HKD 2.03 billion, and financing activities a net outflow of HKD 46.75 million Key Cash Flow Statement Data | Item | H1 2021 (HKD thousand) | H1 2020 (HKD thousand) | | :--- | :--- | :--- | | Net Cash Inflow from Operating Activities | 1,045,603 | 517,285 | | Net Cash Outflow from Investing Activities | (2,032,891) | (1,724,132) | | Net Cash Outflow from Financing Activities | (46,746) | (85,575) | | Net Decrease in Cash and Cash Equivalents | (1,034,034) | (1,292,422) | | Cash and Cash Equivalents at End of Period | 2,411,136 | 2,416,613 | Notes to the Interim Financial Information This section provides detailed notes to the interim financial information, covering revenue, segment information, dividends, and related party transactions Note 4: Revenue from Contracts with Customers and Segment Information All revenue is derived from the single operating segment of coking coal mining in China, with refined coking coal sales reaching HKD 2.44 billion in H1 2021, a 34% year-on-year increase - The Group considers its business as a single operating segment: coking coal mining, exploration, production, and sales in China[52][55] Revenue Composition | Item | H1 2021 (HKD thousand) | H1 2020 (HKD thousand) | | :--- | :--- | :--- | | Sales of Refined Coking Coal | 2,444,193 | 1,818,861 | | Sales of Raw Coking Coal | – | 866 | | Total | 2,444,193 | 1,819,727 | Note 10: Dividends The Board declared an interim dividend of 8 HK cents per share for 2021, totaling approximately HKD 404 million, following the HKD 455 million final dividend for 2020 - An interim dividend of 8 HK cents per ordinary share was declared for 2021, higher than 7.5 HK cents for the same period in 2020[69] - The 2020 final dividend of 9 HK cents per share, totaling HKD 455 million, was approved during the period and paid on July 29, 2021[72][73] Note 22: Related Party Transactions Significant related party transactions occurred with Shougang Group, the ultimate controlling shareholder of Shoucheng Holdings, including HKD 1.12 billion in refined coking coal sales, representing approximately 46% of total revenue - Sales of refined coking coal to related party Shougang Group amounted to HKD 1.12 billion, a significant increase from HKD 666 million in the prior year period[124] - The company paid HKD 1.8 million for office rent and HKD 1.5 million for management consultancy fees to Shougang Holdings[127] Interim Dividend The Board declared an interim dividend of 8 HK cents per ordinary share for the six months ended June 30, 2021 - The Board declared an interim dividend of 8 HK cents per ordinary share for the six months ended June 30, 2021[132] - The interim dividend will be paid on October 28, 2021, to shareholders registered on September 30, 2021[132][133] Management Discussion and Analysis This section provides a comprehensive review of the company's business and financial performance, along with its future outlook Business Review Raw coking coal production increased by 16% year-on-year due to higher output from Jinjiazhuang Coal Mine, while refined coking coal sales grew by 11% despite a slight production decrease Key Operating Data for H1 2021 | Item | Unit | H1 2021 | H1 2020 | Change | | :--- | :--- | :--- | :--- | :--- | | Production | | | | | | Raw Coking Coal | million tonnes | 2.61 | 2.25 | +16% | | Refined Coking Coal | million tonnes | 1.45 | 1.50 | -3% | | Sales Volume | | | | | | Refined Coking Coal | million tonnes | 1.63 | 1.47 | +11% | | Average Realized Selling Price (incl. tax) | | | | | | Refined Coking Coal | RMB/tonne | 1,415 | 1,267 | +12% | - Raw coking coal production growth was primarily due to an 89% year-on-year increase from Jinjiazhuang Coal Mine after its lower seam operations normalized[139][140] - Refined coking coal sales growth was supported by external purchases of approximately 130,000 tonnes and sales from inventory of approximately 70,000 tonnes to meet market demand[141] Financial Review The company achieved strong financial performance in H1 2021, with 34% revenue growth and 23% profit growth, maintaining a robust financial position and ample cash flow Turnover Turnover significantly increased by 34% year-on-year to HKD 2.44 billion, driven by a 12% rise in average selling price, 11% sales volume growth, and a 9.09% appreciation of RMB against HKD - The strong turnover growth resulted from the combined positive effects of sales volume, price, and exchange rate[144] - The top five customers accounted for 86% of total turnover, with the largest customer representing 46%, indicating high customer concentration[145] Cost of Sales Cost of sales rose by 41% year-on-year to HKD 1.23 billion, primarily due to external purchases of refined coking coal, increased raw coking coal for sales, and RMB appreciation - External purchases of approximately 130,000 tonnes of refined coking coal led to an increase in cost of sales of approximately HKD 181 million[154] - The unit production cost of raw coking coal in RMB was RMB 325/tonne, a marginal 1% year-on-year increase, demonstrating effective cost control[156] Gross Profit and Gross Profit Margin Gross profit increased by 28% to HKD 1.22 billion, while gross margin slightly decreased to 50% due to lower-margin external coal purchases; adjusted gross margin, however, improved to 54% - Excluding the impact of external refined coking coal purchases, the adjusted gross margin was approximately 54%, higher than 52% in the prior year period, reflecting improved core business profitability[145][160] Net Profit and EPS Profit attributable to owners grew by 23% to HKD 673 million, and basic earnings per share increased by 29% to 13.33 HK cents, outperforming profit growth due to share repurchases - Net profit growth was primarily driven by a significant increase in gross profit and a net foreign exchange gain of approximately HKD 66 million[147] - Earnings per share increased by 29%, outpacing profit growth, as the number of issued shares decreased by approximately 5% year-on-year due to the company's share repurchase in September 2020[148] Liquidity and Financial Resources The company maintains a very robust financial position with a current ratio of 2.58 times, cash and bank deposits totaling HKD 5.15 billion, and total free cash resources of approximately HKD 6.17 billion as of June 30, 2021 - As of the period end, cash and bank deposits totaled approximately HKD 5.15 billion, with a current ratio of 2.58 times[188] - Including approximately HKD 1.39 billion in available bills receivable, the Group's total free cash resources amounted to approximately HKD 6.17 billion[189] Future Prospects Despite macroeconomic uncertainties and potential steel production controls, coking coal prices are expected to remain high due to tight domestic supply, with the company focusing on safety, efficiency, and smart mining initiatives - Macroeconomically, steel production is expected to decline in the second half of the year, potentially reducing demand for coking coal[200][201] - On the supply side, domestic coking coal supply is unlikely to ease in the short term due to environmental and safety constraints, with prices expected to fluctuate at high levels[201] - The company's strategic focus is to strengthen safety awareness, introduce advanced mining technologies, and promote smart mining to enhance efficiency, ensure safety, and reduce costs[202][203] Disclosure of Interests This section details the interests of the company's directors, chief executives, and substantial shareholders Directors' and Chief Executives' Interests As of June 30, 2021, certain directors held beneficial interests in a small number of company shares, including Mr. Ji Huashi with 700,000 shares and Mr. Cai Weixian with 220,000 shares Directors' Shareholdings | Director's Name | Number of Shares Held | Percentage of Issued Shares | | :--- | :--- | :--- | | Ji Huashi | 700,000 | 0.013% | | Cai Weixian | 220,000 | 0.004% | | Ding Rucai | 120,000 | 0.002% | Substantial Shareholders' Interests As of June 30, 2021, major shareholders included Shougang Group (33.09%), Fude Life Insurance (31.47%), and Mr. Jiang Jinzhi (5.60%), collectively holding approximately 70% of the company's shares Substantial Shareholders' Shareholdings | Shareholder Name | Number of Shares Held | Percentage of Issued Shares | | :--- | :--- | :--- | | Shougang Group | 1,671,726,490 | 33.09% | | Fude Life Insurance | 1,590,100,000 | 31.47% | | Mr. Jiang Jinzhi | 282,702,904 | 5.60% | Corporate Governance and Other Information This section covers the company's compliance with corporate governance codes and the audit committee's review of interim results Compliance with Corporate Governance Code The company complied with most provisions of the Corporate Governance Code during the period, with a minor deviation regarding non-executive directors' fixed terms, addressed by rotational retirement - The company complied with the code provisions of Appendix 14 of the Listing Rules, 'Corporate Governance Code,' except for code provision A.4.1[221] - The deviation is that non-executive directors are not appointed for specific terms, but the company's articles of association require all directors to retire by rotation at least once every three years[221][222] Audit Committee Review The Audit Committee reviewed the unaudited interim results and this interim report, which were also reviewed by the independent auditor, PricewaterhouseCoopers - The Audit Committee has reviewed this interim report and the unaudited interim results[233]