紫金矿业(02899) - 2020 - 年度财报

Company Information Zijin Mining Group Co., Ltd. is a joint-stock company listed on the Hong Kong Stock Exchange and Shanghai Stock Exchange, primarily engaged in the exploration, mining, smelting, and sales of gold, copper, zinc, and other metal mineral resources - Zijin Mining Group Co., Ltd. is a joint-stock company registered in the People's Republic of China, with shares listed on the Hong Kong Stock Exchange (stock code: 02899) and Shanghai Stock Exchange (stock code: 601899)[2][11] - The company primarily engages in the exploration, mining, smelting, and sales of gold, copper, zinc, and other metal mineral resources. As of the end of 2020, the Group held 291 prospecting rights and 236 mining rights[15] Financial Highlights The company achieved significant financial growth in 2020, with revenue increasing by 26.01% and net profit attributable to parent company shareholders rising by 51.93%, alongside substantial growth in total assets and liabilities 2020 Key Financial Data Summary | Indicator | 2020 (RMB) | 2019 (RMB) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 171,501,338,490 | 136,097,978,018 | +26.01% | | Operating Profit | 11,239,742,530 | 7,242,074,162 | +55.20% | | Total Profit | 10,846,027,174 | 6,974,278,766 | +55.51% | | Net Profit | 8,458,038,953 | 5,060,904,684 | +67.12% | | Net Profit Attributable to Parent Company Shareholders | 6,508,553,913 | 4,283,957,365 | +51.93% | 2020 Year-End Key Balance Sheet Data Summary | Indicator | 2020 Year-End (Thousand RMB) | 2019 Year-End (Thousand RMB) | Year-on-Year Change | | :--- | :--- | :--- | :--- | | Total Assets | 182,313,250 | 123,830,947 | +47.23% | | Total Liabilities | 107,716,809 | 66,751,349 | +61.37% | | Total Equity Attributable to Parent Company Shareholders | 56,538,554 | 51,185,965 | +10.46% | Chairman's Report Despite the global pandemic and economic recession in 2020, the company achieved exceptional growth in key economic indicators, significant progress in project construction, and major M&A achievements, doubling its total market capitalization - In 2020, amidst the COVID-19 pandemic and global economic recession, the company's key economic indicators grew beyond expectations, with significant achievements in project construction and major mergers and acquisitions. The company's total market capitalization doubled from RMB 114.8 billion at the end of 2019 to RMB 224.9 billion at the end of 2020[20] - The company's resource reserves significantly increased, with gold exceeding 2,300 tons and copper exceeding 62 million tons, laying a solid foundation for sustainable development. Newly acquired Buriticá Gold Mine in Colombia and Aurora Gold Mine in Guyana generated profits in the same year, and the acquisition of Tibet Julong Copper was successfully completed[21] - The company established a five-year (2+3) plan and 2030 development goals, aiming to become a large-scale, high-tech, and efficient international mining group. In 2021, the focus will be on promoting reforms, accelerating the conversion of resource advantages, increasing resource ownership, leveraging capital markets, and adhering to technological innovation[22] Business Overview The company is a large multinational mining group with operations across 12 countries and 14 provinces in China, primarily engaged in the exploration and development of gold, copper, and other mineral resources Global Presence and Industry Position The company is a large multinational mining group with operations across 12 countries and 14 provinces in China, primarily engaged in the exploration and development of gold, copper, and other mineral resources, holding a leading position in overseas copper and gold reserves and production among Chinese enterprises - The company holds significant mining investment projects in 12 countries globally and 14 provinces (regions) in China, ranking among the largest and most profitable Chinese enterprises in terms of controlled overseas copper and gold resource reserves and mineral product output[43] - The company holds a prominent position in the industry, ranking 3rd among global gold companies and 7th in the non-ferrous metal mining industry in Forbes Global 2000 in 2020[44] Core Competencies The company's core competence lies in innovation, having pioneered the "Ore Flow Five-in-One" mining engineering management model, achieving significant resource discoveries and breakthroughs in developing low-grade, refractory resources - The company created the "Ore Flow Five-in-One" mining engineering management model, integrating geological exploration, mining, mineral processing, metallurgy, and environmental protection for comprehensive research and full-process control to maximize economic and social benefits[57] - Autonomous exploration has yielded fruitful results, with cumulative new discoveries of 27.88 million tons of copper, 1,207 tons of gold, and 8.11 million tons of zinc (lead). Notably, the newly discovered Kamoa-Kakula copper mine in Congo (DRC) boasts over 18 million tons of copper resources[59] - The company possesses leading technology in processing low-grade and refractory resources, having built China's largest gold mine, the world's first ten-million-ton-level copper bio-metallurgy system, and China's first gold mine pressure pre-oxidation plant, among other industry benchmarks[64] Five-Year (2+3) Plan and 2030 Development Goals The company has formulated a "three-step" development plan for the next decade, aiming to become a large-scale, high-tech, and efficient international mining group by 2030, with specific production targets for each phase - The company plans to achieve its 2030 development goals in three phases: - Phase 1 (2021-2022): Achieve leapfrog growth in output and economic indicators, and initially establish a globalized operation and management system - Phase 2 (2023-2025): Comprehensively develop resources, intensify M&A and exploration, and largely reach the level of a world-class metal mining company - Phase 3 (2026-2030): Fully establish a large-scale, high-tech, and efficient international mining group, striving to enter the top 3-5 globally in comprehensive indicators[66][67] Major Mineral Product Output Plan | Product | 2020 Actual | 2021 Plan | 2022 Plan | 2025 Plan | | :--- | :--- | :--- | :--- | :--- | | Mined Gold (tons) | 40.5 | 53-56 | 67-72 | 80-90 | | Mined Copper (10,000 tons) | 45.3 | 54-58 | 80-85 | 100-110 | | Mined Zinc (Lead) (10,000 tons) | 37.8 | 45-48 | 47-50 | - | | Iron Concentrate (10,000 tons) | 387 | 350-380 | 290-330 | - | Key Growth Projects The company is advancing several world-class key growth projects across China, Colombia, Serbia, and Congo (DRC), covering core minerals like gold and copper, with most projects under construction or technical upgrade, expected to contribute significant benefits upon commissioning Key Project Overview | Project Name | Location | Mineral Type | Status | Highlights | | :--- | :--- | :--- | :--- | :--- | | Buriticá Gold Mine, Colombia | Colombia | Gold, Silver | In Production + Expansion | World-class ultra-high-grade large gold mine, commenced production in 2020, annual gold output to reach 9.1 tons after technical upgrade | | Timok Copper-Gold Mine, Serbia | Serbia | Copper, Gold | Under Construction | Super-large copper-gold mine, upper zone expected to commence production in June 2021, peak annual output of 135,000 tons of copper and 6.1 tons of gold | | Kamoa-Kakula Copper Mine, Congo (DRC) | Congo (DRC) | Copper | Under Construction | World's fourth-largest undeveloped high-grade copper mine, Phase I expected to commence production by end of Q2 2021, annual copper output up to 400,000 tons | | Tibet Julong Copper | China Tibet | Copper | In Production + Under Construction | China's largest proven porphyry copper deposit, Phase I planned to commence production by end of 2021, annual copper output approximately 160,000 tons[73][76][82][84] Profiles of Directors, Supervisors, and Senior Management The company's core leadership comprises experienced industry experts, including Chairman Chen Jinghe, who is renowned in geological exploration and mining engineering management, supported by a team with extensive professional knowledge in various fields - The company's core leadership consists of experienced industry experts. Chairman Mr. Chen Jinghe is the company's founder and core leader, highly regarded in geological exploration and mining engineering management. Other directors, supervisors, and senior management possess extensive professional knowledge and practical experience in corporate management, geology, mineral processing, metallurgy, finance, and law[86][87][88] Management Discussion and Analysis This section provides an in-depth analysis of the company's business operations, financial performance, investment activities, and future outlook, highlighting key achievements and identified risks Company Business Overview The company engages in global mining exploration and development, with a business model covering resource exploration, M&A, mine design, construction, operation, and management, extending to smelting and mineral trade, holding a prominent position as one of China's largest producers of gold, copper, and zinc - The company's business model core is mining development, adhering to a dual strategy of independent exploration and resource M&A, and pioneering the "Ore Flow Five-in-One" mining engineering management model to achieve full-process control over geological exploration, mining, mineral processing, metallurgy, and environmental protection[96] - The company is one of China's largest producers of mined gold, copper, and zinc, holding a significant position in domestic resource reserves and output. In 2020, the company's copper resource reserves accounted for approximately 52.56% of China's total, and mined copper output accounted for 27.10% of the domestic total[99][100][101] - The company's core competencies include: sound corporate governance and institutional advantages, robust resource base, continuously growing production capacity, strong technological innovation, leading low-cost operations, and an excellent team and corporate culture[105][106][107][108][109][110] Discussion and Analysis of Operations In 2020, despite pandemic challenges, the company achieved high-speed growth in performance, with sales revenue reaching RMB 171.501 billion (+26.01%) and net profit attributable to parent company RMB 6.509 billion (+51.93%), driven by stable increases in major product output and significant resource reserve enhancements from M&A and project construction 2020 Major Mineral Product Output | Product | Output | Year-on-Year Change | | :--- | :--- | :--- | | Mined Gold | 40,509 kilograms | -0.79% | | Mined Copper | 453,447 tons | +22.60% | | Mined Zinc (Zinc in Concentrate) | 342,131 tons | -8.54% | | Mined Lead (Lead in Concentrate) | 36,072 tons | +5.30% | | Mined Silver | 298,715 kilograms | +13.50% | | Iron Concentrate | 3.87 million tons | +9.63% | 2020 Resource Reserves (by Equity) | Mineral | Unit | 2020 Year-End | 2019 Year-End | Growth Rate (%) | | :--- | :--- | :--- | :--- | :--- | | Gold Ore | Metal tons | 2,333.64 | 1,886.87 | 23.68 | | Copper Ore | Metal 10,000 tons | 6,205.58 | 5,725.42 | 8.39 | | Zinc Ore | Metal 10,000 tons | 1,032.70 | 855.83 | 20.67 | | Silver Ore | Metal tons | 2,923.55 | 1,860.64 | 57.13 | - Through successful acquisitions of Buriticá Gold Mine, Guyana Aurora Gold Mine, and Julong Copper Mine, the company added 385.53 tons of gold, 5.3684 million tons of copper, and 867.44 tons of silver in resource reserves by equity, providing a solid resource guarantee for future growth[124] - The company's overseas business experienced rapid growth, with overseas mineral product output, mining assets, and profits approaching or exceeding half of the company's total. In the reporting period, overseas mined gold, copper, and zinc output accounted for 58%, 44%, and 50% of the company's total, respectively[129] Analysis of Main Business During the reporting period, rising mineral product prices combined with increased sales volume significantly boosted gross profit, with a comprehensive gross margin of 47.71%, while effective cost control was maintained despite an increase in financial expenses Unit Sales Cost and Gross Margin by Product | Product Name | 2020 Unit Sales Cost | 2020 Gross Margin (%) | 2019 Gross Margin (%) | | :--- | :--- | :--- | :--- | | Mined Gold | 177.38 RMB/gram | 51.40 | 41.82 | | Mined Copper | 20,095 RMB/ton | 46.15 | 41.42 | | Mined Zinc | 6,570 RMB/ton | 31.71 | 37.99 | | Mined Silver | 1.45 RMB/gram | 54.19 | 42.71 | | Iron Concentrate | 174.91 RMB/ton | 71.97 | 68.99 | - The increase in mineral product gross margin was primarily due to the year-on-year rise in mineral product sales prices (contributing RMB 3.076 billion to gross profit growth) and effective cost control (contributing RMB 454 million to gross profit growth)[135] - Net cash inflow from operating activities was RMB 14.268 billion, a year-on-year increase of RMB 3.603 billion, mainly due to higher gross profit from rising gold and copper prices and increased sales volume[156] Analysis of Investment Status The company in 2020 completed two significant equity investments, acquiring Guyana Goldfields and a majority stake in Tibet Julong Copper, substantially increasing gold and copper reserves, while also progressing major non-equity projects to lay the foundation for future capacity release - Acquired 100% equity in Guyana Goldfields for approximately CAD 323 million in cash, whose Aurora Gold Mine is an operating mine that can rapidly increase the company's gold output[174] - Acquired 50.1% equity in Tibet Julong Copper for RMB 3.883 billion in cash, a company that owns China's largest porphyry copper deposit, the Qulong Copper Mine[174] Progress of Major Non-Equity Investment Projects | Project Name | Project Amount | Investment in Reporting Period (RMB 100 million) | Cumulative Investment (RMB 100 million) | Progress and Benefits | | :--- | :--- | :--- | :--- | :--- | | Zijin Bor Copper Technical Upgrade, Serbia | 1.294 billion USD | 35.11 | 44.78 | Upon completion, annual copper output will be 120,000 tons, and smelting copper output 180,000 tons | | Julong Copper | 14.6 billion RMB | 23.55 | 96.24 | Qulong Phase I project expected to commence production by end of 2021, with average annual copper output of approximately 160,000 tons | | Xinjiang Zijin Nonferrous Zinc Smelting | 1.497 billion RMB | 6.60 | 15.29 | Qualified zinc ingots produced in December 2020, planned annual output of 100,000 tons | Future Development and Risks The company plans a "three-step" strategy for the next decade, focusing on globalization, large-scale projects, and asset securitization, prioritizing gold and copper businesses to become a global leading mining group, while actively managing identified risks such as metal price volatility and cross-cultural management 2021 Major Mineral Product Output Plan | Product | 2021 Planned Output | | :--- | :--- | | Mined Gold | 53-56 tons | | Mined Copper | 54-58 10,000 tons | | Mined Zinc (Lead) | 45-48 10,000 tons | | Mined Silver | 240-300 tons | | Iron Concentrate | 350-380 10,000 tons | - The company faces major risks including: - Metal Price Risk: Operating performance is highly correlated with fluctuations in gold, copper, and other metal prices - Safety and Environmental Risk: Potential for safety and environmental accidents and natural disasters during mining production - Cross-Cultural Management Risk: Overseas projects face geopolitical, policy, regulatory, and community risks - Financial Market Risk: Changes in interest rates, exchange rates, and stock prices may lead to operational pressure - International Rules and Standards Application Risk: Changes in international rules and standards may affect production and operations[203] Board of Directors' Report The Board of Directors proposed a 2020 profit distribution plan, approved a restricted stock incentive plan, and successfully issued convertible bonds to support the company's global development - The Board of Directors proposed a 2020 profit distribution plan of RMB 1.2 per 10 shares (tax inclusive) in cash dividends, with an estimated total dividend of approximately RMB 3.057 billion, accounting for 46.97% of net profit attributable to parent company shareholders[206][208] - The company commenced a restricted stock incentive plan in November 2020, proposing to grant no more than 100 million A-shares. The initial grant of 95.9806 million shares to 686 incentive recipients was completed in January 2021[211] - The company successfully issued RMB 6 billion A-share convertible corporate bonds ("Zijin Convertible Bonds") on November 3, 2020, with a conversion price of RMB 7.01 per share, providing financial support for the company's global development[216] Independent Directors' Report The company's Board of Directors includes a significant proportion of independent directors with diverse expertise, who actively participate in governance and provide objective opinions on major matters, safeguarding the interests of the company and minority shareholders - The company's Seventh Board of Directors comprises 13 directors, including 6 independent directors, accounting for nearly half, which complies with governance requirements. Independent directors possess extensive professional knowledge in mining, finance, accounting, and law[275] - Independent directors actively participated in the Board and various special committees, providing objective and fair independent opinions on significant matters such as related party transactions, external guarantees, use of raised funds, and equity incentive plans, effectively safeguarding the interests of the company and minority shareholders[274][282][283][284] Supervisory Board Report In 2020, the Supervisory Board held nine meetings, reviewed 28 proposals, and oversaw the company's legal operations, financial status, major M&A, and related party transactions, ensuring compliance and safeguarding shareholder interests - In 2020, the Supervisory Board held 9 meetings, reviewed 28 proposals, and attended Board and relevant meetings, supervising the company's lawful operations, financial status, major M&A, and related party transactions[293] - The Supervisory Board believes that the company's decision-making procedures are legal and compliant, financial reports are true and fair, and internal control systems are sound, with no instances of directors or senior management harming the interests of the company or shareholders found[297] - The Supervisory Board continuously improved the "Five-in-One" supervision mechanism (Supervisory Board, Discipline Inspection Commission, Supervision, Audit, Internal Control), strengthened oversight of key areas such as infrastructure projects and material procurement, and promoted anti-corruption efforts to foster a clean and upright development environment[295] Work on Actively Fulfilling Social Responsibilities The company actively fulfills its social responsibilities by establishing an ESG governance system, responding to the pandemic, prioritizing occupational health and safety, investing in environmental protection, and engaging in community development and targeted poverty alleviation ESG Key Performance Construction The company established a top-down ESG governance system and issued eight policy statements, actively responding to the COVID-19 pandemic, strengthening occupational health and safety, investing in environmental protection, and promoting community development - The company established a top-down ESG governance system by the Board of Directors and issued 8 policy statements covering ecological environmental protection, human resources, health and safety, business ethics, supply chain, whistleblowing management, water resources, and human rights protection[306] - Actively participated in the global fight against the pandemic, donating approximately RMB 30 million in funds and supplies, and co-building a "Huoyan" virus testing laboratory in Serbia[307] 2020 Water Resource Utilization Data | Indicator | Data | | :--- | :--- | | Total Water Consumption | 693.5447 million tons | | New Water Usage | 49.8149 million tons | | Total Wastewater Discharge | 41.9274 million tons | | Water Recycling Rate | 92.82% | Targeted Poverty Alleviation Work The company actively responded to national calls by continuously promoting rural revitalization in poverty-stricken areas surrounding mining sites, investing approximately RMB 120 million in 2020 through various initiatives to improve local living and production conditions 2020 Targeted Poverty Alleviation Achievements Summary | Indicator | Quantity and Situation | | :--- | :--- | | Funds Invested | 117.9003 million RMB | | Number of Registered Poor People Lifted Out of Poverty | 722 persons | | Investment in Industrial Poverty Alleviation Projects | 3.145 million RMB | | Investment in Ecological Protection Poverty Alleviation | 20.15 million RMB | | Investment in Education for Poverty Alleviation | 3.1475 million RMB | - The company's subsidiary, Xinjiang Zijin Zinc Industry Co., Ltd., was awarded "National Advanced Collective for Poverty Alleviation" in 2020 for its outstanding contributions to the "One Hundred Enterprises Helping One Hundred Villages" initiative[314][323] Corporate Governance Report The company is committed to high-level corporate governance, largely complying with the Hong Kong Corporate Governance Code, with a diverse Board of Directors and effective committees overseeing internal control and risk management - The company is committed to maintaining a high level of corporate governance and largely complied with the provisions of the Hong Kong "Corporate Governance Code" during the reporting period. The Board of Directors consists of 13 directors, including 6 independent non-executive directors, ensuring a diversified composition that meets regulatory requirements[349][351] - The Board of Directors has established a Strategy and Sustainable Development (ESG) Committee, an Executive and Investment Committee, an Audit and Internal Control Committee, and a Nomination and Remuneration Committee, all of which effectively fulfilled their duties during the reporting period, supporting the Board's scientific decision-making[358] - The company has established a sound internal control and risk management system, with the Board of Directors, Supervisory Board, and management jointly responsible for the establishment, implementation, and supervision of internal controls, ensuring legal and compliant operations, asset security, and true and complete financial reporting[394][395] Audit Report Ernst & Young Hua Ming LLP issued an unqualified audit opinion on the company's 2020 financial statements, affirming their fair presentation in accordance with accounting standards, while highlighting non-current asset impairment and business combinations as key audit matters - Ernst & Young Hua Ming LLP issued a standard unqualified audit opinion on the company's 2020 financial statements, stating that the financial statements were prepared in all material respects in accordance with enterprise accounting standards, fairly reflecting the company's financial position, operating results, and cash flows[401] - The audit report identified two key audit matters: - Impairment of Non-current Assets: Involving the impairment assessment of fixed assets, construction in progress, intangible assets, and goodwill, due to their material amounts and the significant management estimates involved in their calculation - Business Combinations Not Under Common Control: Involving the acquisitions of Continental Gold, Julong Copper, and Guyana Goldfields, due to their material amounts and the complex valuation techniques required to determine the fair value of identifiable assets and liabilities[405][407] Financial Statements This section presents the company's consolidated financial statements, including the income statement, balance sheet, and cash flow statement, providing a detailed overview of its financial performance and position for the reporting period Consolidated Income Statement In 2020, the company's operating revenue grew by 26.01% to RMB 171.501 billion, with operating profit increasing by 55.2% to RMB 11.240 billion, resulting in a net profit attributable to parent company shareholders of RMB 6.509 billion, up 51.93% 2020 Consolidated Income Statement Summary | Item | 2020 (RMB) | 2019 (RMB) | | :--- | :--- | :--- | | Operating Revenue | 171,501,338,490 | 136,097,978,018 | | Operating Cost | 151,070,863,441 | 120,582,627,749 | | Operating Profit | 11,239,742,530 | 7,242,074,162 | | Total Profit | 10,846,027,174 | 6,974,278,766 | | Net Profit | 8,458,038,953 | 5,060,904,684 | | Net Profit Attributable to Parent Company Shareholders | 6,508,553,913 | 4,283,957,365 | | Basic Earnings Per Share | 0.25 | 0.18 | Consolidated Balance Sheet As of year-end 2020, total assets increased by 47.23% to RMB 182.313 billion, driven by significant M&A and project investments, while total liabilities rose by 61.37% to RMB 107.717 billion, and total equity attributable to parent company shareholders grew by 10.46% to RMB 56.539 billion 2020 Year-End Consolidated Balance Sheet Summary | Item | December 31, 2020 (RMB) | December 31, 2019 (RMB) | | :--- | :--- | :--- | | Total Current Assets | 39,262,403,933 | 28,594,396,116 | | Total Non-current Assets | 143,050,846,470 | 95,236,551,103 | | Total Assets | 182,313,250,403 | 123,830,947,219 | | Total Current Liabilities | 47,035,701,043 | 33,362,656,029 | | Total Non-current Liabilities | 60,681,107,884 | 33,388,693,126 | | Total Liabilities | 107,716,808,927 | 66,751,349,155 | | Total Equity Attributable to Parent Company Shareholders | 56,538,554,204 | 51,185,965,026 | | Total Shareholders' Equity | 74,596,441,476 | 57,079,598,064 | Consolidated Cash Flow Statement In 2020, net cash inflow from operating activities increased by 33.78% to RMB 14.268 billion, while net cash outflow from investing activities significantly rose to RMB 29.174 billion due to major M&A and capital expenditures, with net cash inflow from financing activities at RMB 20.928 billion 2020 Consolidated Cash Flow Statement Summary | Item | 2020 (RMB) | 2019 (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 14,268,403,423 | 10,665,557,013 | | Net Cash Flow from Investing Activities | (29,174,439,163) | (14,102,830,060) | | Net Cash Flow from Financing Activities | 20,928,195,130 | (325,810,301) | | Net Increase in Cash and Cash Equivalents | 5,701,094,790 | (3,847,246,701) | | Cash and Cash Equivalents at Year-End | 11,786,686,240 | 6,085,591,450 |