新疆新鑫矿业(03833) - 2025 - 中期业绩

Company Information This chapter details the company's updated governance structure, including board changes, committee roles, and the abolition of the Supervisory Committee, with its functions transferred to the Audit Committee - Executive Director Li Jiangping was appointed on August 29, 2025, Non-Executive Director Chen Yin was appointed Chairman on August 2, 2025, and Qi Xinhui resigned as Chairman on the same day and as Director on August 29, 2025[6] - The company abolished the Supervisory Committee on June 27, 2025, revised its Articles of Association, and transferred the Supervisory Committee's functions to the Board's Audit Committee[7][78] - The Audit Committee comprises Hu Benyuan (Chairman), Hu Chengye, and Li Daowei, responsible for reviewing the effectiveness of external audits and internal controls[6][80] Company Performance This chapter presents the unaudited consolidated operating results for H1 2025, showing increased revenue but a significant decline in net profit due to lower electrolytic nickel prices and higher production costs, with no interim dividend recommended H1 2025 Consolidated Operating Results Overview | Metric | H1 2025 (RMB million) | H1 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Consolidated Operating Revenue | 1,117.9 | 1,065.4 | +4.9% | | Net Profit Attributable to Company Shareholders | 71.6 | 144.0 | -50.2% | | Basic Earnings Per Share | RMB 0.032 | RMB 0.065 | -50.8% | - The significant decline in net profit was primarily due to a 10.9% decrease in the average selling price of electrolytic nickel (excluding tax), from RMB 124,230/ton to RMB 110,688/ton, and increased production costs (partially due to the use of externally purchased nickel concentrate)[10] - The Board does not recommend an interim dividend for 2025[12] - The Group completed the equity acquisition of Huaou Mining in June 2025 and restated the 2024 consolidated financial statements in accordance with Chinese accounting standards[12] Resources and Reserves This chapter provides detailed resource and reserve estimates as of June 30, 2025, for the company's nickel-copper, vanadium, and fluorite mines, noting the extension of the Mujiahe vanadium mine exploration permit Nickel-Copper Mine Resources and Reserves as of June 30, 2025 | Mining Area | Ore Volume (tons) | Copper Grade (%) | Nickel Grade (%) | Copper Metal (tons) | Nickel Metal (tons) | | :--- | :--- | :--- | :--- | :--- | :--- | | Total Resources | 88,712,958 | - | - | 438,544 | 434,465 | | Kalatongke Nickel-Copper Mine | 26,421,659 | 0.98 | 0.56 | 258,023 | 147,046 | | Huangshandong, Huangshan, Xiangshan Nickel-Copper Mines | 62,291,299 | 0.29 | 0.46 | 180,521 | 287,419 | | Total Reserves | 41,070,597 | - | - | 246,813 | 226,822 | | Kalatongke Nickel-Copper Mine | 16,404,590 | 1.03 | 0.62 | 169,414 | 102,510 | | Huangshandong, Huangshan, Xiangshan Nickel-Copper Mines | 24,666,007 | 0.31 | 0.50 | 77,399 | 124,312 | Vanadium Mine Resources as of June 30, 2025 | Mining Area | Ore Volume (tons) | V2O5 Grade (%) | V2O5 Metal (tons) | | :--- | :--- | :--- | :--- | | Xianghejie Vanadium Mine | 10,159,400 | 0.95 | 96,300 | | Mujiahe Vanadium Mine | 16,410,100 | 0.89 | 146,015 | | Total | 26,569,500 | - | 242,315 | Karqiar Fluorite Mine Resources and Reserves as of June 30, 2025 | Mining Area | Ore Volume (tons) | CaF2 Grade (%) | CaF2 Metal (tons) | | :--- | :--- | :--- | :--- | | Resources | 61,936,000 | 32.95 | 20,409,000 | | Reserves | 24,787,000 | 28.60 | 7,094,000 | - The exploration permit for the Mujiahe vanadium mine has been approved for extension until January 14, 2030; the Xianghejie vanadium mine exploration permit is still under application[15] Management Discussion and Analysis This chapter analyzes H1 2025 operations, business performance, and financial status, highlighting revenue growth despite declining net profit due to market volatility, alongside details on mining, capital expenditure, and risk management Market Review H1 2025 saw international and domestic metal prices align, with LME electrolytic nickel futures down 12.3% and cathode copper futures up 2.6%, mirrored by domestic markets H1 2025 Key Metal Price Changes | Metric | H1 2025 Average Price | H1 2024 Average Price | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | LME Electrolytic Nickel 3-Month Futures | 15,574 USD/ton | 17,750 USD/ton | -12.3% | | LME Cathode Copper 3-Month Futures | 9,446 USD/ton | 9,207 USD/ton | +2.6% | | Shanghai Futures Exchange Electrolytic Nickel Settlement Price (incl. tax) | 124,596 RMB/ton | 136,296 RMB/ton | -8.6% | | Shanghai Yangtze River Nonferrous Metals Spot Market Electrolytic Nickel Spot Price (incl. tax) | 126,015 RMB/ton | 137,660 RMB/ton | -8.5% | | Shanghai Futures Exchange Cathode Copper Settlement Price (incl. tax) | 77,514 RMB/ton | 74,539 RMB/ton | +4.0% | | Shanghai Yangtze River Nonferrous Metals Spot Market Cathode Copper Spot Price (incl. tax) | 77,718 RMB/ton | 74,569 RMB/ton | +4.2% | - Domestic price trends for electrolytic nickel and cathode copper were largely consistent with international markets[19] Business Review The Group's operating revenue grew 4.9% to RMB 1,117.9 million, but net profit attributable to shareholders fell 50.2% to RMB 71.6 million, despite increased sales volumes for electrolytic nickel and cathode copper H1 2025 Key Operating Data | Metric | H1 2025 | H1 2024 | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | RMB 1,117.9 million | RMB 1,065.4 million | +4.9% | | Net Profit Attributable to Company Shareholders | RMB 71.6 million | RMB 144.0 million | -50.2% | | Electrolytic Nickel Production Volume | 6,030 tons | 4,757 tons | +26.7% | | Cathode Copper Production Volume | 3,815 tons | 4,102 tons | -7.0% | | Electrolytic Nickel Sales Volume | 5,672 tons | 4,378 tons | +29.6% | | Cathode Copper Sales Volume | 4,559 tons | 3,008 tons | +51.6% | | Electrolytic Nickel Average Selling Price (excl. tax) | RMB 110,688/ton | RMB 124,230/ton | -10.9% | | Cathode Copper Average Selling Price (excl. tax) | RMB 69,243/ton | RMB 69,407/ton | -0.2% | Outlook and Strategies For H2 2025, the Group plans to boost production, optimize marketing for higher prices, upgrade processes for environmental compliance, and enhance efficiency by controlling non-productive expenses - In H2 2025, the plan is to produce 12,000 tons of electrolytic nickel and 9,900 tons of cathode copper, striving to complete the full-year production plan[21] - The Group will strengthen analysis of international and domestic electrolytic nickel and cathode copper market price trends, implementing more flexible and proactive marketing strategies to achieve higher product selling prices[21] - The Group is committed to upgrading major production processes to adapt to domestic economic restructuring, development model transformation, and higher national and Xinjiang government requirements for safety production and environmental protection[21] - The Group will tap internal potential, strive to increase production and revenue, strictly control non-productive expenses, further reduce production costs and expenditures, and enhance economic efficiency, management level, and overall operational efficiency[21] Mineral Exploration, Mining Development, and Ore Extraction Activities The Group invested significantly in mineral exploration, development, and extraction, with total expenditures of approximately RMB 4.1 million for exploration, RMB 31.1 million for development, and RMB 88.3 million for extraction - Total expenditure on mineral exploration activities was approximately RMB 4.1 million, primarily for surface and underground drilling[22] - Total expenditure on mining development activities was approximately RMB 31.1 million, primarily for tunneling construction[23] - Total expenditure on ore extraction operations was approximately RMB 88.3 million, with Kalatongke Mining producing 570,133 tons of ore and Xinjiang Yakesi and Hami Jubao producing 667,412 tons of ore[25] Financial Review and Analysis Turnover increased, but gross profit and margin declined due to lower electrolytic nickel prices and higher costs, while sales expenses rose, administrative expenses stabilized, net finance costs increased, and investment income improved H1 2025 Sales Details by Product | Product Name | H1 2025 Sales Volume (tons) | H1 2025 Amount (RMB thousand) | H1 2024 Sales Volume (tons) | H1 2024 Amount (RMB thousand) | | :--- | :--- | :--- | :--- | :--- | | Electrolytic Nickel | 5,672 | 627,861 | 4,378 | 531,526 | | Cathode Copper | 4,559 | 315,691 | 3,008 | 208,801 | | Copper Concentrate | 3,764 | 67,951 | 4,689 | 64,174 | | Other Products | - | 88,955 | - | 249,883 | | Total Main Business Revenue | - | 1,100,458 | - | 1,054,384 | | Gross Profit | - | 230,534 | - | 323,298 | | Gross Profit Margin | - | 21.0% | - | 30.2% | - Gross profit from main operations was RMB 230.5 million, a decrease of approximately RMB 92.8 million from the same period last year; the gross profit margin for main operations was approximately 21.0%, a decrease of approximately 9.2 percentage points from the same period last year[28] - Sales and marketing expenses increased by 20.9% year-on-year to RMB 7.8 million, primarily due to higher transportation costs resulting from increased production and sales volumes[29] - Net finance costs increased to RMB 20.5 million (H1 2024: RMB 16.3 million), mainly due to increased bank borrowings from the acquisition of Huaou Mining's equity[32] - Investment income was approximately RMB 14.2 million, an increase of RMB 2.8 million from the same period last year, primarily due to a reduction in nickel concentrate inventory purchased from Hexin Mining and the realization of internal unrealized profits at the consolidated level[33] Financial Position As of June 30, 2025, total assets grew 2.2%, operating cash inflow increased, but significant investing cash outflow occurred due to fixed asset purchases and the Huaou Mining acquisition, while financing cash inflow rose from increased borrowings H1 2025 Financial Position Overview | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Y-o-Y Change (%) | | :--- | :--- | :--- | :--- | | Shareholders' Equity | 6,197.7 | 7,220.8 | -14.2% | | Total Assets | 9,880.7 | 9,644.2 | +2.2% | | Net Cash Inflow from Operating Activities | 194.2 | 158.4 | +22.6% | | Net Cash Outflow from Investing Activities | 324.1 | 321.7 (Acquisition of fixed assets) | - | | Net Cash Inflow from Financing Activities | 94.4 | - | - | - Net cash outflow from investing activities was approximately RMB 324.1 million, primarily due to cash outflow of RMB 321.7 million for the acquisition of fixed and long-term assets during the period[34] - Net cash inflow from financing activities was approximately RMB 94.4 million, mainly due to increased cash inflow from bank borrowings, offset by cash outflow for the acquisition of Huaou Mining and repayment of loans and interest[34] Liquidity and Financial Resources As of June 30, 2025, cash and cash equivalents decreased, while total borrowings significantly increased, resulting in a substantial rise in net debt and gearing ratio, and a slight decline in the current ratio H1 2025 Liquidity and Financial Resources | Metric | June 30, 2025 (RMB million) | December 31, 2024 (RMB million) | Change | | :--- | :--- | :--- | :--- | | Total Cash and Cash Equivalents | 547.0 | 582.4 | -6.1% | | Total Borrowings | 1,966.2 | 764.0 | +157.3% | | Net Debt | 1,419.2 | 181.6 | +681.5% | | Gearing Ratio | 18.6% | 2.5% | +16.1 percentage points | | Current Ratio | 1.4 times | 1.5 times | -0.1 times | - Total borrowings were approximately RMB 1,966.2 million, including loans from the Company, Xinjiang Yakesi, Kalatongke Mining, and Huaou Mining[36] Risk Management The Group manages risks from commodity price volatility, exchange rate fluctuations, stricter environmental policies, and interest rate changes through continuous monitoring, process upgrades, and flexible financial strategies - Commodity price risk: Influenced by international and domestic market prices, global supply and demand changes, economic cycles, and currency market fluctuations, which may significantly impact turnover and comprehensive income[37] - Exchange rate fluctuation risk: Transactions are conducted in RMB, but exchange rate fluctuations may affect international and domestic commodity prices and impact operating performance[38] - Environmental risk: Chinese government environmental inspections may increase enterprise output volatility, and the Group is committed to upgrading production processes to meet higher standards[39] - Interest rate risk: Primarily arises from bank borrowings, with floating-rate borrowings exposing the Group to cash flow interest rate risk. As of June 30, 2025, interest-bearing debt mainly consisted of RMB-denominated floating-rate borrowings, totaling RMB 1,965.3 million[41] Purchase, Sale or Redemption of the Company's Listed Securities Neither the Company nor its subsidiaries purchased, sold, or redeemed any of the Company's listed securities during the period - Neither the Company nor any of its subsidiaries purchased, sold, or redeemed any of the Company's listed securities[42] Pledge of Assets As of June 30, 2025, the Group had no pledged or mortgaged assets - As of June 30, 2025, the Group had no pledged or mortgaged assets[43] Contingent Liabilities The Group had no other significant contingent liabilities as of June 30, 2025, beyond those disclosed in the financial statement notes - Except for those disclosed in Notes X, 2(4) and XIII to the financial statements, the Group had no other significant contingent liabilities as of June 30, 2025[44] Major Acquisitions and Disposals The Group acquired a 51% equity interest in Huaou Mining for approximately RMB 1,098.08 million, making it a non-wholly-owned subsidiary, with no other major acquisitions or disposals during the period - The acquisition of a 51% equity interest in Huaou Mining was completed on June 12, 2025, for approximately RMB 1,098.08 million, making Huaou Mining a non-wholly-owned subsidiary of the Company[45] - Apart from the aforementioned acquisition, the Group had no other major acquisitions or disposals[46] Events After the Balance Sheet Date Post-balance sheet date, the Group acquired a 2.4167% equity interest in Xinjiang Zhongxin Mining Co., Ltd. for zero consideration, making it a wholly-owned subsidiary - On June 26, 2025, the Group signed an equity transfer agreement with Sichuan Aokai Investment Development Co., Ltd. to acquire a 2.4167% equity interest in Zhongxin Mining for zero consideration[434] - The transaction completed industrial and commercial change registration on August 14, 2025, making Zhongxin Mining a wholly-owned subsidiary of the Group[434] Historical Capital Expenditure H1 2025 total capital expenditure was RMB 490.623 million, mainly for Huaou Mining's mining, beneficiation construction, and related operations H1 2025 Capital Expenditure Breakdown | Business | Amount (RMB thousand) | Percentage of Total (%) | | :--- | :--- | :--- | | Kalatongke Mining's Mining, Beneficiation, Smelting, and Related Operations | 31,218 | 6.4% | | Fukang Smelter's Refining and Related Operations | 60,260 | 12.3% | | Xinjiang Yakesi's Mining and Beneficiation Operations | 36,467 | 7.4% | | Huaou Mining's Mining and Beneficiation Construction Projects, Beneficiation, and Related Operations | 362,678 | 73.9% | | Total | 490,623 | 100% | Group's Plans for Major Investments or Capital Asset Acquisitions in H2 2025 The Group plans RMB 547.6 million in H2 2025 investments for capacity enhancement, automation, and construction at various mines and smelters, funded by internal operating capital H2 2025 Major Investment Plan | Project | Planned Investment (RMB million) | | :--- | :--- | | Kalatongke Mining: Improvement of Mining, Beneficiation, and Smelting Operations | 123.2 | | Fukang Smelter: Improvement of Refining Capacity and Automation Upgrades | 137.9 | | Xinjiang Yakesi: Enhancement of Production Capacity and Automation Level | 48.3 | | Huaou Mining: Mining and Beneficiation Construction Projects, Beneficiation, and Related Projects | 237.3 | | Capital Expenditure for Fixed Asset Acquisition | 38.9 | | Total | 547.6 | - The funding for the above plans will be entirely from the Group's internal operating capital[54] Commitments The Group's commitments as of June 30, 2025, are detailed in Note XIII of the unaudited consolidated interim financial statements - The Group's commitments as of June 30, 2025, are disclosed in Note XIII to the unaudited consolidated interim financial statements[56] Directors' Interests This chapter details directors' and supervisors' interests in company shares and debentures as of June 30, 2025, including share appreciation rights, noting no significant contractual interests or rights exercised during the period - As of June 30, 2025, no director or supervisor of the Company had any direct or indirect material interest in any contract significant to the Group's business entered into by the Company, its holding company, its subsidiaries, or any of its fellow subsidiaries during the period[58] Directors'/Supervisors' Long Positions in the Company's Shares or Related Shares as of June 30, 2025 | Director/Supervisor | Personal Interest | Corporate Interest | Total Interest | Share Class | Approximate % of Relevant Share Class | Approximate % of Total Share Capital | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Zhou Chuanyou | - | 480,924,000 | 345,924,000 | Domestic Shares | 27.47% | 15.65% | | | - | - | 135,000,000 | H Shares | 14.20% | 6.11% | - The number of grantees for the share appreciation rights incentive scheme has been adjusted from 150 to 96, and the number of effective rights from 63,500,000 to 34,685,000[62][64] - The exercise price of share appreciation rights has been adjusted from HKD 1.58/right to HKD 1.31/right, primarily due to the company's payment of final dividends for 2022, 2023, and 2024[62][63][64] - No share appreciation rights were exercised during the period[65] Share Capital and Dividends This chapter outlines the company's share capital structure as of June 30, 2025, including domestic and H shares, and major shareholder interests, noting no share capital changes or interim dividend recommendations for 2025 Share Capital Structure as of June 30, 2025 | Share Class | Number of Issued Shares | Percentage of Share Capital (%) | Par Value (RMB thousand) | | :--- | :--- | :--- | :--- | | Domestic Shares of RMB 0.25 each | 1,259,420,000 | 56.99 | 314,855 | | H Shares of RMB 0.25 each | 950,580,000 | 43.01 | 237,645 | | Total | 2,210,000,000 | 100.00 | 552,500 | - As of June 30, 2025, there were no changes in the Company's share capital[329] Major Shareholders' Share Interests as of June 30, 2025 | Name | Number of Shares Held | Share Class | Approximate % of Relevant Share Class Held | Approximate % of Total Share Capital | | :--- | :--- | :--- | :--- | :--- | | Xinjiang Nonferrous Metals Industry (Group) Co., Ltd. | 885,204,000 (L) | Domestic Shares | 70.29 | 40.06 | | Shanghai Yilian | 282,896,000 (L) | Domestic Shares | 22.46 | 12.80 | | CICC Investment | 63,028,000 (L) | Domestic Shares | 5.00 | 2.85 | | | 135,000,000 (L) | H Shares | 14.20 | 6.11 | - The Board does not recommend any interim dividend for 2025[72] Employees and Benefits As of June 30, 2025, the Group had 1,730 employees, predominantly production staff, receiving wages, bonuses, and allowances, and participating in comprehensive social insurance schemes Employee Count by Department as of June 30, 2025 | Department | Number of Employees | Percentage of Total (%) | | :--- | :--- | :--- | | Management and Administration | 149 | 8.61% | | Engineering and Technical Personnel | 170 | 9.83% | | Production Personnel | 1,133 | 65.49% | | Maintenance | 209 | 12.08% | | Inspection | 60 | 3.47% | | Sales | 9 | 0.52% | | Total Employees | 1,730 | 100% | - Employee remuneration packages include wages, bonuses, and allowances, and participation in social insurance contribution schemes[73] - Social insurance contribution percentages: pension insurance 16%, medical insurance 6.5% to 8%, unemployment insurance 0.5%, housing provident fund 12%, enterprise annuity 8%, and work injury insurance 1.04% to 2.85%[73] Corporate Governance This chapter affirms the company's commitment to high corporate governance standards, full compliance with Listing Rules, effective Board and Audit Committee operations, and the transfer of Supervisory Committee functions to the Audit Committee - The Company fully complied with all code provisions of the Corporate Governance Code set out in Appendix C1 of the Listing Rules during the period[76] - The Board of Directors comprises nine directors and held 3 meetings during the period, with an attendance rate of 89%[77] - The Supervisory Committee was abolished effective June 27, 2025, with its functions now exercised by the Board's Audit Committee[78] - All directors, supervisors, and senior management of the Company consistently complied with the requirements of the Model Code for Securities Transactions by Directors of Listed Issuers during the period[79] - The Audit Committee reviewed the Group's unaudited financial results and interim report for the period and deemed them compliant with relevant accounting standards and adequately disclosed[80] Consolidated and Company Balance Sheets (Unaudited) This chapter presents the unaudited balance sheets as of June 30, 2025, showing consolidated total assets of RMB 9.881 billion (up 2.2%), total liabilities of RMB 3.683 billion (with increased long-term borrowings), and total shareholders' equity of RMB 6.198 billion Key Consolidated Balance Sheet Data | Item | June 30, 2025 (RMB) | December 31, 2024 (Restated) (RMB) | | :--- | :--- | :--- | | Total Assets | 9,880,663,775.81 | 9,644,157,242.55 | | Total Current Assets | 2,181,457,938.81 | 2,296,227,223.67 | | Total Non-current Assets | 7,699,205,837.00 | 7,347,930,018.88 | | Total Liabilities | 3,682,931,609.08 | 2,423,330,479.10 | | Total Current Liabilities | 1,520,328,340.23 | 1,574,509,600.12 | | Total Non-current Liabilities | 2,162,603,268.85 | 848,820,878.98 | | Total Shareholders' Equity | 6,197,732,166.73 | 7,220,826,763.45 | | Total Equity Attributable to Parent Company Shareholders | 5,443,701,386.15 | 6,463,116,439.99 | - Long-term borrowings significantly increased from RMB 96,000,000.00 on December 31, 2024, to RMB 1,419,796,776.23 on June 30, 2025[83] - Construction in progress increased from RMB 730,737,155.40 on December 31, 2024, to RMB 1,188,694,727.52 on June 30, 2025[81] Consolidated and Company Income Statements (Unaudited) This chapter presents the unaudited income statements for H1 2025, showing consolidated operating revenue up 4.9%, but net profit down 47.8%, and net profit attributable to parent company shareholders down 50.2%, with basic EPS at RMB 0.032 Key Consolidated Income Statement Data | Item | For the Six Months Ended June 30, 2025 (RMB) | For the Six Months Ended June 30, 2024 (Restated) (RMB) | | :--- | :--- | :--- | | Total Operating Revenue | 1,117,897,502.64 | 1,065,356,736.99 | | Total Operating Costs | 1,052,091,981.21 | 891,959,207.75 | | Operating Profit | 84,012,161.70 | 172,935,606.86 | | Total Profit | 83,787,970.16 | 173,928,612.29 | | Net Profit | 67,966,645.46 | 130,122,812.03 | | Net Profit Attributable to Parent Company Owners | 71,646,188.34 | 143,957,457.02 | | Basic Earnings Per Share (RMB/share) | 0.032 | 0.065 | - A business combination under common control occurred during the period, with the acquiree's net loss before combination being RMB 2,837,715.47[87] Consolidated and Company Cash Flow Statements (Unaudited) This chapter presents the unaudited cash flow statements for H1 2025, showing increased operating cash flow, significantly higher investing cash outflow (due to fixed assets and Huaou Mining acquisition), and positive financing cash flow from increased borrowings Key Consolidated Cash Flow Statement Data | Item | For the Six Months Ended June 30, 2025 (RMB) | For the Six Months Ended June 30, 2024 (Restated) (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 194,249,027.21 | 158,390,443.47 | | Net Cash Flow from Investing Activities | (324,067,216.94) | (130,006,212.75) | | Net Cash Flow from Financing Activities | 94,448,895.33 | (13,919,851.11) | | Net Increase in Cash and Cash Equivalents | (35,369,294.40) | 14,464,379.61 | | Cash and Cash Equivalents at End of Period | 547,036,529.43 | 498,167,148.99 | - Net cash outflow from investing activities increased, mainly due to cash payments of RMB 321,660,201.32 for the acquisition of fixed assets and other long-term assets, and RMB 1,098,084,000.00 for the acquisition or disposal of subsidiaries and other operating units by the parent company[90] - Subtotal cash inflow from financing activities was RMB 1,451,296,776.23, primarily from borrowings[91] Consolidated Statement of Changes in Shareholders' Equity (Unaudited) This chapter presents the unaudited consolidated statement of changes in shareholders' equity for H1 2025, showing a period-end total of RMB 6.198 billion, a decrease from the restated opening balance, mainly due to a business combination under common control and net profit changes Key Consolidated Statement of Changes in Shareholders' Equity Data | Item | Opening Balance as of January 1, 2025 (Restated) (RMB) | Changes (RMB) | Closing Balance as of June 30, 2025 (RMB) | | :--- | :--- | :--- | :--- | | Share Capital | 552,500,000.00 | - | 552,500,000.00 | | Capital Reserve | 5,144,151,097.76 | (1,097,762,726.99) | 4,046,388,370.77 | | Special Reserve | 1,300,130.31 | 8,222,795.40 | 9,522,925.71 | | Surplus Reserve | 276,250,000.00 | - | 276,250,000.00 | | Retained Earnings | 488,915,211.92 | 70,124,877.75 | 559,040,089.67 | | Total Equity Attributable to Company Shareholders | 6,463,116,439.99 | (1,019,415,053.84) | 5,443,701,386.15 | | Non-controlling Interests | 757,710,323.46 | (3,679,542.88) | 754,030,780.58 | | Total Shareholders' Equity | 7,220,826,763.45 | (1,023,094,596.72) | 6,197,732,166.73 | - A business combination under common control resulted in a decrease in capital reserve of RMB 1,098,084,000.00 and a decrease in retained earnings of RMB 1,521,310.59[93] - Total comprehensive profit was RMB 67,966,645.46, of which net profit attributable to parent company shareholders was RMB 71,646,188.34[93] Company Statement of Changes in Shareholders' Equity (Unaudited) This chapter presents the unaudited company statement of changes in shareholders' equity for H1 2025, showing a period-end total of RMB 5.258 billion, a decrease from the opening balance, mainly due to a capital reserve reduction from a business combination under common control Key Company Statement of Changes in Shareholders' Equity Data | Item | Opening Balance as of January 1, 2025 (RMB) | Changes (RMB) | Closing Balance as of June 30, 2025 (RMB) | | :--- | :--- | :--- | :--- | | Share Capital | 552,500,000.00 | - | 552,500,000.00 | | Capital Reserve | 4,254,754,857.49 | (212,502,900.00) | 4,042,573,230.50 | | Special Reserve | 1,300,130.31 | 1,659,490.79 | 2,959,621.10 | | Surplus Reserve | 276,250,000.00 | - | 276,250,000.00 | | Retained Earnings | 345,807,792.74 | 37,481,383.62 | 383,289,176.36 | | Total Shareholders' Equity | 5,430,612,780.54 | (173,362,052.59) | 5,257,572,027.96 | - A business combination under common control resulted in a decrease in capital reserve of RMB 212,502,900.00[94] - Net comprehensive profit was RMB 37,481,383.62[94] Notes to the Financial Statements (Unaudited) This chapter provides comprehensive notes to the unaudited financial statements, detailing company information, accounting policies, estimates, taxation, major consolidated and company financial items, interests in other entities, financial instruments, fair value, capital management, related party transactions, share-based payments, segment information, commitments, contingencies, and post-balance sheet events Company Information This section details Xinjiang Xinxin Mining Industry Co., Ltd.'s 2005 establishment, share capital evolution to RMB 552.5 million, and primary business in mining, beneficiation, smelting, and sales of copper, nickel, and vanadium - The Company was jointly established on September 1, 2005, by Xinjiang Nonferrous Metals Industry (Group) Co., Ltd. and other entities[95] - Following new share issuance in 2006 and share split and H-share issuance in 2007, the total share capital increased to RMB 552,500,000.00 after issuance[96] - The Group's business scope primarily involves the mining, beneficiation, smelting, and processing and sales of copper, nickel, vanadium, and other non-ferrous metals[97] Basis of Preparation of Financial Statements The financial statements are prepared on a going concern basis, adhering to Chinese Enterprise Accounting Standards and relevant regulations, with some compliance to the Hong Kong Companies Ordinance - The Group's financial statements are prepared in accordance with the "Enterprise Accounting Standards" promulgated by the Ministry of Finance, along with their application guidelines, interpretations, and other relevant regulations[99] - These financial statements are prepared on a going concern basis[101] Significant Accounting Policies and Accounting Estimates This section outlines the Group's significant accounting policies and estimates, covering financial instruments, inventory, asset depreciation/amortization, impairment, revenue recognition, employee compensation, and share-based payments, along with key assumptions and risks - Financial assets are classified into three categories based on the business model for managing them and their contractual cash flow characteristics: measured at amortized cost, measured at fair value through other comprehensive income, and measured at fair value through profit or loss[114] - Inventories include raw materials, work-in-progress, self-produced semi-finished goods, and finished goods, presented at the lower of cost and net realizable value, with the cost of issued inventory calculated using the weighted average method[129][130] - Depreciation of fixed assets, except for mine shafts and structures, is calculated using the straight-line method; mine shafts and structures are depreciated using the production method[145][147] - Intangible assets include mining rights, exploration rights, and land use rights; mining rights are amortized using the production method, and land use rights are amortized using the straight-line method[153][154][156] - Revenue is recognized when performance obligations in the contract are satisfied, i.e., when the customer obtains control of the related goods or services[180] - The Group's acquisition of Xinjiang Huaou Mining Co., Ltd. constituted a business combination under common control, accounted for using the cost method, and resulted in the restatement of the 2024 consolidated financial statements[214] Taxation This section details the Group's and its subsidiaries' applicable tax types and rates, including VAT, resource tax, and corporate income tax, with most subsidiaries benefiting from a 15% preferential corporate income tax rate Major Tax Types and Rates | Tax Type | Tax Base | Tax Rate/Levy Rate/Tax Amount | | :--- | :--- | :--- | | Value-Added Tax (VAT) | Taxable Value Added | 5%、6%、9%、13% | | Resource Tax | Sales Revenue of Taxable Resource Products | 4%、8% | | Urban Maintenance and Construction Tax | Amount of Turnover Tax Payable | 5%、1% | | Education Surcharge | Amount of Turnover Tax Payable | 3% | | Local Education Surcharge | Amount of Turnover Tax Payable | 2% | | Property Tax | Taxable Residual Value, Taxable Rental Income | 1.2%、12% | | Land Use Tax | Actual Land Area Used | 12 RMB/㎡、4.2 RMB/㎡、1.5 RMB/㎡、1.05 RMB/㎡ | | Environmental Protection Tax | Emission Volume of Different Pollutants | 1.2 RMB/unit pollution equivalent | | Corporate Income Tax | Taxable Income | 15%、20%、25% | - The Company, Xinjiang Yakesi, Hami Jubao, Xinjiang Kalatongke Mining Co., Ltd., and Xinjiang Huaou Mining Co., Ltd. are subject to a 15% corporate income tax rate, as they are high-tech enterprises or comply with the encouraged industry catalog[218][219][222] - Xinjiang Mengxi Mining Co., Ltd. is subject to a 20% corporate income tax rate (small-profit enterprise), while Xinjiang Zhongxin Mining Co., Ltd., Beijing Xinding Shunze High-Tech Co., Ltd., and Shaanxi Xinxin Mining Co., Ltd. are subject to a 25% corporate income tax rate[218][222] Notes to Major Items in Consolidated Financial Statements This section provides detailed notes on major consolidated financial statement items, including cash, receivables, inventories, investments, fixed assets, construction in progress, intangible assets, goodwill, deferred taxes, borrowings, payables, compensation, provisions, revenue, costs, expenses, investment income, income tax, EPS, and cash flow, with significant growth in construction in progress and long-term borrowings indicating investment expansion H1 2025 Overview of Major Items in Consolidated Financial Statements | Item | Amount (RMB) | | :--- | :--- | | Cash and Bank Balances | 629,154,892.84 | | Accounts Receivable | 277,614,607.74 | | Inventories | 1,014,597,880.45 | | Long-term Equity Investments | 205,098,565.14 | | Fixed Assets | 3,400,041,671.26 | | Construction in Progress | 1,188,694,727.52 | | Intangible Assets | 2,458,022,037.62 | | Goodwill | 108,081,096.95 | | Short-term Borrowings | 200,137,777.78 | | Long-term Borrowings | 1,419,796,776.23 | | Operating Revenue | 1,117,897,502.64 | | Operating Costs | 883,484,612.61 | | Net Profit | 67,966,645.46 | | Net Cash Flow from Operating Activities | 194,249,027.21 | | Net Cash Flow from Investing Activities | (324,067,216.94) | | Net Cash Flow from Financing Activities | 94,448,895.33 | - Construction in progress increased by RMB 429,225,867.62 during the period, primarily for the Karqiar Southwest Fluorite Mine project[284] - Long-term borrowings significantly increased, mainly due to the acquisition of Huaou Mining's equity[32] - Investment income increased, primarily due to the realization of internal unrealized profits at the consolidated level during the period[33] Interests in Other Entities This section details the Group's subsidiaries and joint ventures, including their capital, business, and shareholdings, noting Xinjiang Mengxi Mining Co., Ltd.'s deregistration and providing key financial data for significant non-wholly-owned entities Overview of Major Subsidiaries | Subsidiary Name | Shareholding Percentage (Direct) (%) | Acquisition Method | | :--- | :--- | :--- | | Xinjiang Yakesi Resources Development Co., Ltd. | 99.51 | Business combination not under common control | | Hami Jubao Resources Development Co., Ltd. | 98.96 | Business combination not under common control | | Xinjiang Zhongxin Mining Co., Ltd. | 97.58 | Business combination not under common control | | Xinjiang Kalatongke Mining Co., Ltd. | 100.00 | Establishment or Investment | | Shaanxi Xinxin Mining Co., Ltd. | 51.00 | Business combination not under common control | | Xinjiang Huaou Mining Co., Ltd. | 51.00 | Business combination under common control | - Xinjiang Mengxi Mining Co., Ltd. was deregistered in April 2025[366][367] - Important non-wholly-owned subsidiaries include Xinjiang Zhongxin Mining Co., Ltd., Shaanxi Xinxin Mining Co., Ltd., and Xinjiang Huaou Mining Co., Ltd.[368] - The significant joint venture is Hexin Mining, with a 50.00% shareholding, accounted for using the equity method[372] Financial Instruments and Risks This section details the Group's market risks (foreign exchange, interest rate, concentration), credit risk, and liquidity risk, and their management strategies, noting RMB-settled business, floating-rate borrowing interest risk, and credit/liquidity control measures - The Group's main operations are located in China, with primary business settled in RMB, and no forward foreign exchange contracts or currency swap contracts have been signed[376] - Interest rate risk primarily arises from bank borrowings; as of June 30, 2025, interest-bearing debt consisted of RMB-denominated floating-rate borrowings, totaling RMB 1,965,296,776.23[377] - Concentration risk: For the six months ended June 30, 2025, 71.98% of sales revenue came from the top three customers[378] - Credit risk primarily arises from cash and bank balances, notes receivable, accounts receivable, receivables financing, other receivables, and financial guarantee contracts, with the maximum credit risk exposure being a financial guarantee amount of RMB 25,000,000.00[379] Undiscounted Contractual Cash Flows of Financial Liabilities by Maturity as of June 30, 2025 | Item | Within One Year (RMB) | One to Two Years (RMB) | Two to Five Years (RMB) | Over Five Years (RMB) | Total (RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | | Short-term Borrowings | 202,648,922.92 | - | - | - | 202,648,922.92 | | Long-term Borrowings | 355,589,500.00 | 292,349,028.98 | 1,233,402,864.76 | 324,115,488.11 | 2,205,456,881.85 | | Financial Guarantees | 25,000,000.00 | - | - | - | 25,000,000.00 | Fair Value Disclosures This section discloses recurring fair value measurements of assets and liabilities as of June 30, 2025, categorized by input observability, with receivables financing (notes receivable) valued using a discounted cash flow model as Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis as of June 30, 2025 | Item | Level 1 Fair Value Measurement (RMB) | Level 2 Fair Value Measurement (RMB) | Level 3 Fair Value Measurement (RMB) | Total (RMB) | | :--- | :--- | :--- | :--- | :--- | | Receivables Financing - Notes Receivable | - | 106,418,104.33 | - | 106,418,104.33 | | Financial Liabilities at Fair Value Through Profit or Loss | 224,737.71 | - | - | 224,737.71 | - Receivables financing (notes receivable) are valued using a discounted cash flow model, with a discount rate of 3.45%, which moves inversely with fair value and is considered an unobservable input[392] Capital Management This section outlines the Group's capital management goal to ensure continuous operation and shareholder returns, maintaining an optimal capital structure by monitoring the gearing ratio, which was 18.63% as of June 30, 2025, within the 2% to 30% target range - The objective of the Group's capital management policy is to ensure its continuous operation, thereby providing returns to shareholders and benefiting other stakeholders, while maintaining an optimal capital structure to reduce the cost of capital[394] Gearing Ratio | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Borrowings (RMB) | 1,966,187,401.20 | 763,999,147.22 | | Net Debt (RMB) | 1,419,150,871.77 | 181,593,323.39 | | Shareholders' Equity (RMB) | 6,197,732,166.73 | 7,220,826,763.45 | | Total Capital (RMB) | 7,616,883,038.50 | 7,402,420,086.84 | | Gearing Ratio | 18.63% | 2.45% | - The Group's strategy is to maintain the gearing ratio between 2% and 30%[394] Related Parties and Related Party Transactions This section details the Group's related party relationships and transactions, including goods, services, leases, guarantees, and key management compensation, all priced based on mutual agreement - The Company's parent company is Xinjiang Nonferrous Metals Industry (Group) Co., Ltd., with a shareholding of 40.06%[395] - Related party transaction pricing policy: Sales prices, purchase prices, services, and leases with related parties are all based on prices agreed upon by both parties[400] H1 2025 Major Related Party Transaction Amounts | Transaction Type | For the Six Months Ended June 30, 2025 (RMB) | | :--- | :--- | | Purchase of Goods | 57,014,984.14 | | Receipt of Services | 84,648,854.29 | | Sale of Products and Energy | 323,354,367.10 | | Provision of Services | - | | Related Lease Income | - | | Payment for Related Lease Liabilities | 594,489.40 | | Amount of Related Party Guarantees | 25,000,000.00 | - Key management personnel compensation totaled RMB 1,551,913.41[408][411] Share-based Payments This section describes the company's H-share appreciation rights incentive scheme, adjusted due to personnel changes and dividends, affecting grantees, effective rights, and exercise price, with no rights exercised as of June 30, 2025 - The Company implemented a share appreciation rights incentive scheme for middle and senior management and other core personnel, granting a total of 63,500,000 share appreciation rights to grantees, with an exercise price of HKD 1.58/right[425] - The incentive scheme has been adjusted, with the number of grantees reduced from 150 to 96, and the number of effective rights from 63,500,000 to 34,685,000[426] - The exercise price has been adjusted from HKD 1.58/right to HKD 1.31/right, primarily due to the company's payment of annual dividends[426] - As of June 30, 2025, the exercise price of outstanding share appreciation rights at period-end was HKD 1.31/right, with a remaining contractual term until October 29, 2026[64][427] Segment Information The Group operates as a single segment, primarily in copper and nickel mining, beneficiation, smelting, and refining, with all operations in China, and 71.98% of sales revenue from its top three customers - The Group operates as a single operating segment, primarily engaged in the mining, beneficiation, smelting, and refining of copper and nickel, as well as the processing and sales of copper, nickel, and other non-ferrous metals[429] - For the six months ended June 30, 2025, all of the Group's sales operations were conducted within China, and all of the Group's assets and liabilities were located in China[429] - For the six months ended June 30, 2025, sales revenue from the Group's top three customers accounted for 28%, 25%, and 19% of total sales revenue, respectively, totaling 71.98%[429] Commitments and Contingencies This section discloses capital expenditure commitments of RMB 342.44 million as of June 30, 2025, and contingent matters including environmental uncertainties, insufficient insurance coverage risks, and financial guarantees for joint ventures Capital Expenditure Commitments as of June 30, 2025 | Item | Amount (RMB) | | :--- | :--- | | Buildings, Structures, Mine Shafts and Structures, Machinery and Equipment, and Engineering Construction | 342,443,036.62 | - Environmental contingent items involve multiple uncertainties that could have a significant adverse impact on the Group's financial position or operating performance[431] - Insurance coverage may be insufficient to cover future potential losses, which could have a significant adverse impact on operating performance or financial position[432] - Details of guarantees provided are in Note X, 2.(4), including a financial guarantee of RMB 25,000,000.00 for Hexin Mining[433][407] Events After the Balance Sheet Date Post-balance sheet date, the Group acquired a 2.4167% equity interest in Xinjiang Zhongxin Mining Co., Ltd. for zero consideration, making it a wholly-owned subsidiary - On June 26, 2025, the Group signed an equity transfer agreement with Sichuan Aokai Investment Development Co., Ltd. to acquire a 2.4167% equity interest in Zhongxin Mining for zero consideration[434] - The transaction completed industrial and commercial change registration on August 14, 2025, making Zhongxin Mining a wholly-owned subsidiary of the Group[434] Other Significant Matters As of the balance sheet date, the Group had no other significant undisclosed transactions or matters impacting investor decisions - As of the balance sheet date, the Group had no other significant transactions or matters requiring disclosure that would affect investors' decisions or significant commitments[435] Notes to Major Items in Company Financial Statements This section details major parent company financial statement items, including accounts receivable, other receivables, and long-term equity investments, reflecting its asset structure as a holding company Overview of Company Accounts Receivable | Item | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Accounts Receivable | 272,879,896.93 | 421,351,353.31 | | Less: Provision for Bad Debts | 2,422,196.27 | 2,488,924.29 | | Total | 270,457,700.66 | 418,862,429.02 | Overview of Company Other Receivables | Item | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Interest Receivable | 45,459,000.00 | 44,255,750.00 | | Other Receivables | 13,736,795.47 | 13,667,794.72 | | Total | 59,195,795.47 | 57,923,544.72 | Overview of Company Long-term Equity Investments | Item | June 30, 2025 (RMB) | December 31, 2024 (RMB) | | :--- | :--- | :--- | | Investments in Subsidiaries | 3,186,853,364.12 | 2,311,472,264.12 | | Investments in Joint Ventures | 205,098,565.14 | 209,788,023.73 | | Total | 3,391,951,929.26 | 2,521,260,287.85 | - The parent company's investments in subsidiaries increased by RMB 885,581,100.00 during the period, primarily due to the acquisition of Xinjiang Huaou Mining Co., Ltd[457] Supplementary Information to Financial Statements (Unaudited) This chapter provides unaudited supplementary financial information, including a detailed statement of non-recurring gains and losses and calculations of return on net assets and earnings per share, both of which decreased despite positive non-recurring impacts Statement of Non-recurring Gains and Losses for the Period Total non-recurring gains and losses for the period were RMB 5,177,950.17, mainly from government grants and other non-operating items, positively impacting the Group's net profit H1 2025 Non-recurring Gains and Losses Details | Item | For the Six Months Ended June 30, 2025 (RMB) | For the Six Months Ended June 30, 2024 (RMB) | | :--- | :--- | :--- | | Government Grants Recognized in Profit or Loss | 6,462,846.39 | 12,138,433.75 | | Other Non-operating Income and Expenses | (224,191.54) | 993,005.43 | | Subtotal | 6,238,654.85 | 13,410,628.54 | | Less: Income Tax Impact | 935,493.63 | 2,017,490.58 | | Non-controlling Interests Impact (After Tax) | 125,211.05 | 47,707.29 | | Total | 5,177,950.17 | 11,345,430.67 | Return on Net Assets and Earnings Per Share The Group's weighted average return on net assets and earnings per share both declined year-on-year, indicating weakened profitability, with similar downward trends observed after adjusting for non-recurring items H1 2025 Return on Net Assets and Earnings Per Share | Metric | For the Six Months Ended June 30, 2025 | For the Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Weighted Average Return on Net Assets Attributable to Ordinary Shareholders of the Parent Company | 1.32% | 2.23% | | Weighted Average Return on Net Assets Attributable to Ordinary Shareholders of the Parent Company After Deducting Non-recurring Gains and Losses | 1.22% | 2.05% | | Basic Earnings Per Share Attributable to Ordinary Shareholders of the Parent Company | 0.032 | 0.065 | | Basic Earnings Per Share Attributable to Ordinary Shareholders of the Parent Company After Deducting Non-recurring Gains and Losses | 0.030 | 0.060 |