中核钛白(002145) - 2017 Q4 - 年度财报

Important Notice, Table of Contents, and Definitions This section provides essential disclaimers, the report's structure, and definitions of key terms for clarity Important Notice The company's board, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of this annual report, with all directors attending the review - The company's management ensures the truthfulness, accuracy, and completeness of the annual report, assuming corresponding legal responsibilities[3] - The 2017 profit distribution plan is to distribute a cash dividend of 0.20 yuan (tax inclusive) per 10 shares, with no bonus shares or capital reserve conversions[4] Table of Contents The report comprehensively discloses the company's detailed information for 2017 across twelve chapters, covering business, operations, significant events, and financial reports Definitions This chapter defines the main company entity abbreviations, professional terms, and regulatory body names used in the report, providing a foundation for understanding its content Company Profile and Key Financial Indicators This section introduces the company's fundamental information and presents its key financial performance metrics for the reporting period Company Basic Information CNNC Huayuan Titanium Dioxide Co., Ltd. (CNNC Titanium Dioxide, stock code 002145) is listed on the Shenzhen Stock Exchange, with no changes in its main business or controlling shareholder since listing Company Basic Information | Item | Information | | :--- | :--- | | Stock Abbreviation | CNNC Titanium Dioxide | | Stock Code | 002145 | | Listing Exchange | Shenzhen Stock Exchange | | Legal Representative | Li Jianfeng | | Change in Main Business | No change | | Change in Controlling Shareholder | No change | Key Accounting Data and Financial Indicators In 2017, the company achieved significant performance growth, with operating revenue increasing by 58.99% to 3.256 billion yuan and net profit attributable to shareholders surging by 362.06% to 389 million yuan Key Financial Indicators | Key Financial Indicators | 2017 | 2016 | Year-on-year Change | | :--- | :--- | :--- | :--- | | Operating Revenue (yuan) | 3,256,404,916.64 | 2,048,165,770.67 | 58.99% | | Net Profit Attributable to Listed Company Shareholders (yuan) | 388,549,022.05 | 84,090,715.43 | 362.06% | | Net Cash Flow from Operating Activities (yuan) | 457,762,397.13 | 368,332,004.77 | 24.28% | | Basic Earnings Per Share (yuan/share) | 0.24 | 0.05 | 380.00% | | Weighted Average Return on Net Assets | 13.98% | 3.29% | 10.69% | | Total Assets (yuan) | 5,699,088,868.70 | 5,225,945,943.08 | 9.05% | | Net Assets Attributable to Listed Company Shareholders (yuan) | 2,996,828,195.10 | 2,563,814,436.02 | 16.89% | Quarterly Key Financial Indicators The company maintained stable operations in 2017, with operating revenue consistently growing in the first three quarters and net profit attributable to shareholders strong in the first half Quarterly Key Financial Indicators | Indicator (yuan) | Q1 | Q2 | Q3 | Q4 | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 796,904,477.78 | 837,214,474.95 | 873,382,073.50 | 748,903,890.41 | | Net Profit Attributable to Listed Company Shareholders | 118,345,957.90 | 116,688,139.77 | 70,689,196.84 | 82,825,727.54 | Non-recurring Gains and Losses In 2017, non-recurring gains and losses totaled 4.76 million yuan, primarily from investment income from the disposal of available-for-sale financial assets and government subsidies, partially offset by non-current asset disposal losses Non-recurring Gains and Losses | Item | 2017 Amount (yuan) | Explanation | | :--- | :--- | :--- | | Gains/Losses from Disposal of Non-current Assets | -25,478,226.53 | - | | Government Subsidies Included in Current Profit/Loss | 13,988,669.81 | - | | Investment Income from Disposal of Available-for-Sale Financial Assets | 17,853,945.00 | Investment income from disposal of Huishang Bank equity | | Total | 4,764,568.27 | - | Company Business Overview This section outlines the company's primary business activities, industry landscape, and core competitive advantages Main Business and Industry Status The company's core business is the R&D, production, and sales of rutile titanium dioxide and iron oxide pigments, ranking second in China's titanium dioxide industry - The company's main business is rutile titanium dioxide and iron oxide pigments, positioning it as the second-largest enterprise in China's titanium dioxide industry[25] - In 2017, China's total titanium dioxide output was 2.8695 million tons, a 10.49% year-on-year increase, with exports reaching nearly 830,000 tons, up approximately 15%[29] - The titanium dioxide industry is significantly influenced by the real estate (approximately 60%) and automotive (approximately 20%) industries, showing a positive correlation with the macroeconomic cycle[30] Core Competitiveness Analysis The company's core competitiveness is rooted in its technological prowess, strategic industrial layout, market advantages, and circular economy model - Technological Advantage: The company has established long-term technical cooperation with institutions like Germany's Ti-Cons and Tsinghua University, employing international experts and building a comprehensive application R&D system[33] - Multi-regional Industrial Layout: Leveraging three production bases in Gansu, Anhui, and Jiangsu, the company optimizes resource allocation and reduces production costs[34] - Circular Economy Advantage: The company utilizes waste heat from sulfuric acid production and converts ferrous sulfate by-product into iron oxide, achieving comprehensive resource utilization and energy conservation[37] Management Discussion and Analysis This section provides an in-depth analysis of the company's operating performance, financial position, and future outlook Overview of Operating Performance In 2017, the company achieved its best operating performance since listing, with total revenue reaching 3.256 billion yuan and net profit attributable to shareholders surging to 389 million yuan Core Performance Indicators | Core Performance Indicators | 2017 | Year-on-year Growth | | :--- | :--- | :--- | | Total Operating Revenue | 3.256 billion yuan | 58.99% | | Operating Profit | 459 million yuan | 274.98% | | Net Profit Attributable to Parent Company | 389 million yuan | 362.06% | Main Product Production and Sales | Main Product Production and Sales | 2017 Production | Year-on-year Growth | 2017 Sales | Year-on-year Growth | | :--- | :--- | :--- | :--- | | Titanium Dioxide Finished Products | 221,200 tons | 16.23% | 223,000 tons | 7.77% | | Iron Oxide Finished Products | 22,400 tons | 13.69% | 22,400 tons | 12.41% | - The company's R&D investment significantly increased, with approximately 92.67 million yuan invested in 2017, a 107.85% year-on-year increase, accounting for 2.85% of operating revenue[48] Main Business Analysis The company's main business is fine chemicals, with titanium dioxide products being the core source of revenue and profit, showing strong growth in both domestic and international markets Revenue and Costs In 2017, titanium dioxide products accounted for 95.58% of the company's operating revenue, with foreign market revenue growth significantly outpacing domestic, and raw materials being the largest component of titanium dioxide operating costs 2017 Operating Revenue Composition | Category | Revenue Amount (yuan) | Proportion of Total Revenue | Year-on-year Change | | :--- | :--- | :--- | :--- | | By Product | | | | | Titanium Dioxide | 3,112,398,257.81 | 95.58% | 60.52% | | Iron Oxide | 112,939,133.13 | 3.47% | 18.09% | | By Region | | | | | Domestic | 2,134,287,802.12 | 65.54% | 51.92% | | International | 1,122,117,114.52 | 34.46% | 74.42% | 2017 Titanium Dioxide Operating Cost Composition | Item | Amount (yuan) | Proportion of Operating Cost | | :--- | :--- | :--- | | Raw Materials | 1,301,121,111.00 | 59.59% | | Energy | 431,703,144.20 | 19.77% | | Labor | 63,386,932.80 | 2.90% | | Manufacturing Expenses, Depreciation, and Others | 270,114,332.25 | 12.37% | Expense Analysis In 2017, the company's management expenses saw the largest increase, primarily due to higher R&D, equity incentive, and repair costs, while sales expenses increased moderately and financial expenses remained stable Expense Items | Expense Item | 2017 (yuan) | 2016 (yuan) | Year-on-year Change | Main Change Explanation | | :--- | :--- | :--- | :--- | :--- | | Selling Expenses | 99,524,441.93 | 88,541,476.15 | 12.40% | - | | Administrative Expenses | 294,645,933.50 | 204,157,157.10 | 44.32% | Increase in R&D expenses, equity incentive expenses, and repair expenses | | Financial Expenses | 57,022,384.70 | 56,519,996.77 | 0.89% | - | R&D Investment The company significantly increased R&D investment in 2017 to maintain its technological advantage, with spending reaching 92.67 million yuan, a 107.85% increase, and R&D personnel growing by 19.83% R&D Investment | R&D Investment | 2017 | 2016 | Change Percentage | | :--- | :--- | :--- | :--- | | R&D Investment Amount (yuan) | 92,670,655.39 | 44,586,234.56 | 107.85% | | R&D Investment as % of Operating Revenue | 2.85% | 2.18% | 0.67% | | Number of R&D Personnel (people) | 145 | 121 | 19.83% | Cash Flow Analysis In 2017, the company's net cash flow from operating activities was 458 million yuan, a 24.28% increase, while investment cash outflow significantly narrowed, and financing cash outflow expanded due to loan repayments Cash Flow Items | Cash Flow Item (yuan) | 2017 | 2016 | Year-on-year Change | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 457,762,397.13 | 368,332,004.77 | 24.28% | | Net Cash Flow from Investing Activities | -108,699,718.54 | -395,364,531.69 | 72.51% | | Net Cash Flow from Financing Activities | -332,455,955.17 | -20,350,733.67 | -1,533.63% | Analysis of Assets and Liabilities As of year-end 2017, total assets grew by 9.05% to 5.699 billion yuan, with significant increases in construction in progress and receivables, while short-term borrowings decreased and notes payable increased Major Asset and Liability Items | Major Asset and Liability Items | 2017 Year-end (yuan) | 2016 Year-end (yuan) | Explanation of Change | | :--- | :--- | :--- | :--- | | Construction in Progress | 754,483,826.94 | 352,348,248.01 | Increased investment in subsidiary Oriental Titanium Industry project | | Notes Receivable | 529,920,491.69 | 305,224,161.72 | Increased pledged notes in the bill pool | | Short-term Borrowings | 546,100,000.00 | 861,010,000.00 | Repayment of bank loans | | Notes Payable | 908,515,038.97 | 488,486,784.77 | Increased purchases settled by notes | Analysis of Investment Status The company made two significant non-core equity investments totaling 51.92 million yuan, acquiring stakes in Jiangsu Hezhe New Energy Materials Technology Co., Ltd. and Yixing Huayi Pigment Technology Co., Ltd. to seek new profit growth Invested Companies | Invested Company | Main Business | Investment Amount (yuan) | Shareholding Percentage | | :--- | :--- | :--- | :--- | | Jiangsu Hezhe New Energy Materials Technology Co., Ltd. | R&D, purchase, and sale of battery materials | 26,923,077.00 | 35.00% | | Yixing Huayi Pigment Technology Co., Ltd. | Manufacturing and sales of new iron oxide coloring materials | 25,000,000.00 | 33.30% | Analysis of Major Holding and Participating Companies Anhui Jinxing Titanium Dioxide (Group) Co., Ltd., a core subsidiary, significantly contributed to the company's 2017 performance, generating 3.222 billion yuan in revenue and 420 million yuan in net profit Subsidiary Performance | Subsidiary Name | Operating Revenue (yuan) | Operating Profit (yuan) | Net Profit (yuan) | | :--- | :--- | :--- | :--- | | Anhui Jinxing Titanium Dioxide (Group) Co., Ltd. | 3,222,118,229.72 | 488,935,827.49 | 419,579,148.06 | Company's Future Development Outlook The company plans to strengthen its titanium dioxide core business, increase R&D, expand product applications, and enhance talent development, while addressing risks such as economic cycles and market competition - Development Strategy: - Strengthen and expand the titanium dioxide core business, consolidating industry position[79] - Increase R&D investment, broaden product application areas, and seek new profit growth points[80] - Enhance talent development and build an international talent team[81] - 2018 Operating Plan: - Prioritize safety production and environmental management[82] - Advance staffing and compensation system reforms[83] - Accelerate the construction of the Oriental Titanium Industry new project, ensuring successful trial operation in 2018[84] - Optimize customer structure and improve international sales channels[85] - Facing Risks: - Economic cycle fluctuation risk (influenced by real estate and automotive industries)[87] - Increased market competition risk[88] - Price fluctuation risk of major raw materials (titanium concentrate, sulfuric acid)[89] - Price fluctuation risk of titanium dioxide products[90] Significant Events This section details the company's key activities and developments during the reporting period, including profit distribution, commitment fulfillment, and major contracts Profit Distribution The company adhered to its shareholder return plan, proposing a 2017 cash dividend of 0.2 yuan (tax inclusive) per 10 shares, totaling 31.84 million yuan, marking its first cash dividend since listing Dividend Distribution | Dividend Year | Cash Dividend Amount (tax inclusive, yuan) | Proportion of Net Profit Attributable to Parent Company | | :--- | :--- | :--- | | 2017 | 31,836,431.52 | 8.19% | | 2016 | 0.00 | 0.00% | | 2015 | 0.00 | 0.00% | Fulfillment of Commitments During the reporting period, the company's actual controller and related parties consistently fulfilled commitments regarding independence, avoiding horizontal competition, and standardizing related-party transactions - The company's actual controller and related parties are normally fulfilling their commitments to maintain the independence of the listed company's personnel, assets, finance, organization, and business[99][100] - Commitments regarding avoiding horizontal competition and standardizing related-party transactions have also been observed[101] Equity Incentive and Employee Stock Ownership Plans The company implemented multiple employee incentive measures, including repurchasing and canceling restricted shares, unlocking the second tranche of the 2015 restricted stock incentive plan, and launching the 2017 employee stock ownership plan - A total of 1.746 million restricted shares that did not meet incentive conditions due to reasons such as resignation were repurchased and canceled[112] - The second unlocking period of the 2015 restricted stock incentive plan saw 7.623 million shares unlocked and listed for trading[114] - The 2017 employee stock ownership plan completed the purchase of 26,170,618 shares, accounting for 1.64% of the total share capital, at an average transaction price of approximately 6.04 yuan/share, with a 12-month lock-up period[115] Significant Contracts: Finance Leases To support operations, the company's subsidiaries entered into three sale-and-leaseback finance lease transactions totaling up to 440 million yuan, aiming to revitalize fixed assets and optimize debt structure - Subsidiary Anhui Jinxing Titanium Dioxide engaged in finance lease transactions of up to 220 million yuan with Haitong UniTrust International Leasing and 110 million yuan with Ping An International Financial Leasing[123][124] - Subsidiary Gansu Hecheng Titanium Industry engaged in a finance lease transaction of up to 110 million yuan with Far East Horizon Limited[123] Social Responsibility and Environmental Protection The company and its subsidiaries are designated key polluting units, but have implemented environmental control facilities, achieved compliant emissions, and publicly disclosed environmental information in 2017 - The company and its subsidiaries, Jinxing Titanium Dioxide and Hecheng Titanium Industry, are classified as key polluting units, with main pollutants being wastewater (PH, COD) and exhaust gas (SO2)[139][140] - The company has installed various environmental control facilities and developed an Emergency Plan for Environmental Incidents; in 2017, all environmental facilities operated stably, achieving compliant pollutant emissions[140][141] Share Changes and Shareholder Information This section details changes in the company's share capital and provides an overview of its shareholder structure Share Changes The company's total share capital decreased to 1,591,821,576 shares due to the repurchase and cancellation of 1.746 million restricted shares, while restricted shares decreased and unrestricted shares increased due to unlocking - Total share capital decreased from 1,593,567,576 shares to 1,591,821,576 shares due to the repurchase and cancellation of 1.746 million restricted shares[145] - The second unlocking period of the 2015 restricted stock incentive plan resulted in 7.623 million restricted shares being unrestricted and listed for trading, leading to a decrease in restricted shares[146] Shareholders and Actual Controller Information As of year-end 2017, the company had 96,455 common shareholders, with controlling shareholder Li Jianfeng holding 37.04% of shares, of which approximately 87.7% were pledged, and institutional investors appearing among the top ten shareholders - As of the end of the reporting period, the total number of common shareholders was 96,455[150] - The company's controlling shareholder and actual controller is Mr. Li Jianfeng, with no changes during the reporting period[153][155] Top Shareholders | Shareholder Name | Shareholding Percentage | Number of Shares Held | Pledged or Frozen Status | | :--- | :--- | :--- | :--- | | Li Jianfeng | 37.04% | 589,559,784 | Pledged 517,267,395 | | Chang'an Trust - Chang'an Investment No. 904 | 2.46% | 39,228,403 | - | | Hu Jianlong | 1.98% | 31,585,493 | Pledged 31,170,000 | Directors, Supervisors, Senior Management, and Employees This section provides information on the company's governance personnel and overall employee structure Changes in Holdings of Directors, Supervisors, and Senior Management Chairman Li Jianfeng's shareholding remained unchanged, while some directors, supervisors, and senior management had minor reductions due to equity incentive unlocks or personal reasons, and some restricted shares were repurchased due to personnel changes - Chairman Li Jianfeng held 589,559,784 shares at the end of the period, with no changes during the reporting period[161] - Former Vice Chairman and General Manager Li Yufeng resigned due to personal reasons[162] Employee Information As of the reporting period end, the company had 2,251 employees, with production personnel accounting for 64.28%, and approximately 39% holding college degrees or higher, supported by a performance-linked compensation system and multi-level training Employee Breakdown | Category | Number of People | Proportion | | :--- | :--- | :--- | | Professional Composition | | | | Production Personnel | 1,447 | 64.28% | | Technical Personnel | 126 | 5.60% | | Education Level | | | | Postgraduate and above | 11 | 0.49% | | Undergraduate | 238 | 10.57% | | College Diploma | 622 | 27.63% | | Total | 2,251 | 100% | Corporate Governance This section describes the company's corporate governance framework and its internal control systems Overview of Corporate Governance The company has established a sound corporate governance structure in strict accordance with laws and regulations, ensuring independence from its controlling shareholder in all key aspects, and its governance practices comply with regulatory requirements - The company's corporate governance structure is well-established and complies with legal and regulatory requirements, showing no significant discrepancies with normative documents issued by the China Securities Regulatory Commission[183][184] - The company maintains independence from its controlling shareholder in terms of business, assets, organization, personnel, and finance, possessing independent operating capabilities[185][186] Internal Control Evaluation Report Based on the board's self-assessment and the auditor's assurance report, the company maintained effective internal controls related to financial reporting in all material aspects as of December 31, 2017, with no significant deficiencies found - No significant or material deficiencies were found in financial or non-financial reporting during the reporting period[196][197] - The accounting firm issued a standard unqualified assurance report on the company's internal controls, consistent with the board's self-assessment report[198] Financial Report This section presents the company's audited financial statements and related notes for the reporting period Audit Report ShineWing Certified Public Accountants issued a standard unqualified audit opinion on the company's 2017 financial statements, highlighting "impairment of fixed assets" as a key audit matter due to its significant impact - The audit opinion type is a "standard unqualified opinion"[202] - The key audit matter identified was "fixed asset impairment"; the company recognized a fixed asset impairment provision of 117 million yuan for the current period, and auditors performed procedures including internal control testing, asset physical counts, and reasonableness analysis of key assumptions[205] Financial Statements This section presents the company's audited consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in equity for 2017 Notes to Consolidated Financial Statements This section provides detailed explanations of the composition and changes of major accounts in the consolidated financial statements - Total restricted assets at year-end amounted to 1.60 billion yuan, primarily including pledged notes receivable (407 million yuan), construction in progress pledged for borrowings (697 million yuan), fixed assets (105 million yuan), and intangible assets (82 million yuan)[451] - Due to the shutdown requirement for its grandchild company Yancheng Baoju, the company fully recognized a goodwill impairment provision of 1,386,291.95 yuan related to the original acquisition of Nantong Baoju[380] - The company's total internal R&D expenditure in 2017 was 92.72 million yuan, of which only 15,700 yuan was capitalized as intangible assets, with the remaining 92.67 million yuan expensed in the current period[378] Reference Documents This section lists the documents available for investor review Reference Documents This section lists the reference documents available for investor review, including the original annual report signed by the legal representative, financial statements, audit report, and all publicly disclosed documents and announcements from the reporting period