中国建筑国际(03311) - 2021 - 年度财报

Company Overview Company Business Structure The Group's business is segmented into Mainland China, Hong Kong, Macau, and other regions, encompassing infrastructure investment, construction, and asset operation, with specialized services like curtain wall systems provided by a listed subsidiary - The Group's business layout is clear, with core markets in Mainland China, Hong Kong, and Macau, covering the entire chain of construction, infrastructure investment, and operation, and expanding into specialized areas (e.g., curtain wall systems) [9] Board of Directors and Committees The Board of Directors, led by Chairman Mr. Yan Jianguo, includes executive, non-executive, and independent non-executive directors, supported by four specialized committees to ensure governance independence - The Board has established four committees: Audit, Remuneration, Nomination, and Sustainable Development, chaired by Mr. Li Shing Che, Mr. Li Minqiao, and Mr. Zhou Hancheng respectively, reflecting a clear division of responsibilities and a focus on sustainable governance [14] Company Information China State Construction International Holdings Limited (03311.HK) is a Cayman Islands-registered company listed on the Hong Kong Stock Exchange, with its head office in Hong Kong and audited by Ernst & Young - Key company information includes stock code 03311, listed on the Hong Kong Stock Exchange, with disclosure of critical financial dates such as interim and annual results announcement and dividend payment schedules [19][20] Financial Highlights The Group achieved significant growth in 2021, with turnover up 23.8% to HKD 77.31 billion and profit attributable to shareholders up 13.1% to HKD 6.80 billion, supported by strong uncompleted contract value Five-Year Financial Summary (As of December 31) | Indicator | 2017 | 2018 | 2019 | 2020 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Turnover (HKD thousands) | 50,152,524 | 55,626,304 | 61,669,678 | 62,458,009 | 77,309,614 | | Profit Attributable to Shareholders (HKD thousands) | 5,490,091 | 4,500,148 | 5,413,208 | 6,015,368 | 6,800,879 | | Earnings Per Share (HK cents) | 118.85 | 89.13 | 107.21 | 119.14 | 134.94 | | Dividend Per Share (HK cents) | 35.00 | 27.00 | 32.00 | 36.00 | 40.50 | | Net Assets Per Share (HKD) | 7.62 | 8.53 | 10.08 | 11.54 | 13.14 | | Uncompleted Contract Value (HKD billions) | 188.01 | 236.56 | 227.07 | 252.37 | 281.36 | Annual Milestones 2021 was a productive year for the Group, marked by major project completions, significant contract wins in Hong Kong and Macau, successful financing activities in Mainland China, and numerous awards for innovation, sustainability, and governance - January-February: Completed and handed over the Central Government-aided North Lantau Hospital Hong Kong Infection Control Centre, and secured the highest-value wholly-owned Macau engineering project in the company's history [28] - May-June: Multiple subsidiaries successfully registered in Qianhai, Shenzhen, expanding Greater Bay Area business; awarded five accolades by Institutional Investor, including 'Most Honored Company' and 'Best ESG Company' [30][34] - August-September: S&P upgraded the Group's rating outlook to 'Stable'; successfully issued the first engineering receivables ABS; China State Construction Hong Kong awarded the 'Hong Kong Star Brand Enterprise Award' [39][42] - November-December: Hong Kong Organic Resources Recovery Centre Phase 2 project committed to construction phase carbon neutrality; the Group became the first TCFD supporter in China's construction industry; awarded the NCE Tunnelling Awards and '2021 Touching Hong Kong Organization' honor [47][50][51] Operations and Financial Review Chairman's Report Chairman Mr. Yan Jianguo's report highlights the Group's robust growth in 2021, driven by strong new contract growth across Mainland China, Hong Kong, Macau, and the curtain wall market, while outlining strategies in sustainability, risk, finance, human resources, and technology 2021 Key Performance Indicators | Indicator | Amount | YoY Change | | :--- | :--- | :--- | | Revenue | HKD 77.31 billion | - | | Operating Profit | HKD 11.24 billion | - | | Profit Attributable to Shareholders | HKD 6.80 billion | +13.1% | | Basic Earnings Per Share | 134.94 HK cents | - | | Full-Year Dividend | 40.5 HK cents | +12.5% | - In 2021, the Group undertook 167 new projects, with attributable contract value reaching HKD 140.05 billion, laying a solid foundation for future revenue growth [55] 2021 New Contract Value by Market | Market | New Contract Value (HKD) | YoY Growth | | :--- | :--- | :--- | | Mainland China | HKD 81.15 billion | +23.7% | | Hong Kong | HKD 36.05 billion | +33.0% | | Macau | HKD 14.64 billion | +10.2% | | China State Construction International Holdings | HKD 8.21 billion | +60.4% | - Looking ahead, the Group will steadfastly implement its 'Technology+' strategy, adhere to a differentiated competitive approach, and seize development opportunities in Hong Kong's Northern Metropolis, major livelihood projects in Macau, and the deep integration of the Greater Bay Area [69][70] Business Review Sustainable Development Management Risk Management Financial Management Human Resources Technological Innovation Business Outlook Management Discussion and Analysis Management's analysis highlights a 23.8% turnover increase to HKD 77.31 billion, driven by strong orders, with notable growth in Macau, while financial optimization and business transformation significantly improved operating cash flow, resulting in a 69.4% net gearing ratio 2021 Overall Performance | Indicator | Amount | YoY Growth | | :--- | :--- | :--- | | Turnover | HKD 77.31 billion | +23.8% | | Basic Earnings Per Share | 134.94 HK cents | +13.3% | | Total Annual Dividend | 40.5 HK cents | +12.5% | 2021 Segment Performance | Market Segment | Turnover (HKD billions) | YoY Growth | Segment Results (HKD billions) | YoY Growth | | :--- | :--- | :--- | :--- | :--- | | Hong Kong | 23.844 | +6.4% | 0.850 | -14.2% | | Macau | 8.405 | +86.6% | 0.832 | +63.3% | | Mainland China | 40.529 | +25.3% | 8.784 | +35.1% | - Cash recovery from Mainland China construction-related investment projects intensified, with HKD 25.508 billion in repurchase payments received during the year, a 38.8% year-on-year increase [76] - Operating cash flow significantly improved, with net cash used in operating activities decreasing substantially from HKD 4.532 billion in the prior year to HKD 0.551 billion during the year [88] Financial Position as of End 2021 | Indicator | December 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Shareholders' Equity | HKD 66.216 billion | HKD 58.280 billion | | Bank Balances and Cash | HKD 24.407 billion | HKD 22.455 billion | | Total Borrowings | HKD 70.335 billion | HKD 54.375 billion | | Net Gearing Ratio | 69.4% | 54.8% | | Unutilized Bank Facilities | HKD 82.107 billion | - | Overall Performance Segment Performance Corporate Finance Financial Risk Management Policies Business Review As of end-2021, the Group's business expanded with 376 projects under construction, total attributable contract value of HKD 476.66 billion, and uncompleted contract value of HKD 281.36 billion, driven by 167 new projects, primarily in Mainland China 2021 New Projects Awarded Overview | Item | Quantity | Attributable Contract Value | | :--- | :--- | :--- | | New Projects Awarded | 167 projects | HKD 140.05 billion | Projects Under Construction as of End 2021 | Market Distribution | Number of Projects | Attributable Contract Value (HKD millions) | Uncompleted Contract Value (HKD millions) | | :--- | :--- | :--- | :--- | | Mainland China | 196 | 294,224 | 185,449 | | Hong Kong | 154 | 110,981 | 60,728 | | Macau | 26 | 52,741 | 24,334 | | China State Construction International Holdings Group | — | 18,716 | 10,849 | | Total | 376 | 476,662 | 281,360 | - New contracts by market distribution show Mainland China accounting for 57.9%, Hong Kong 25.7%, and Macau 10.5%, indicating Mainland China remains the primary growth engine while Hong Kong and Macau markets remain stable [96] Major Completed Projects New Projects Awarded Projects Under Construction Corporate Governance and Social Responsibility Major Honors and Awards In 2021, the Group received numerous awards across comprehensive strength, corporate governance, brand building, public welfare, and safety and environmental protection, reflecting high industry and social recognition - Corporate Governance and Brand Awards: Ranked first as 'Most Honored Company' and 'Best ESG Company' in the Industrials Small & Mid-Cap category by Institutional Investor, and included in the FTSE4Good Index Series for five consecutive years [130] - Public Welfare Awards: Received the 9th Hong Kong Outstanding Volunteer Award – Corporate Award, demonstrating the company's outstanding contributions to corporate social responsibility [131] - Engineering and Technology Awards: The Guizhou Zhengxi Expressway Extra-Long Tunnel Group Project received the 2021 NCE Tunnelling Awards, showcasing the Group's technical prowess in complex engineering fields [133] - Safety and Environmental Awards: Awarded the 'Low-Carbon Care Environmental, Social and Governance (ESG) Label' for 6 consecutive years, and achieved the highest rating (LEVEL 4) for 4 consecutive years, demonstrating the company's long-term commitment and practice in sustainable development [134] Corporate Citizenship Adhering to its mission, the Group actively fulfills corporate citizenship through employee development programs, ISO14001 environmental management, low-carbon construction, extensive social welfare activities, and effective investor relations, earning multiple awards - Employee Development: Launched the 'Double Hundred' Youth Development Program, committing to provide at least 100 graduate employment positions and 100 internship opportunities annually, and dispatching Hong Kong employees to participate in Greater Bay Area construction [138][141] - Environmental Protection: Promoted low-carbon construction technologies such as Modular Integrated Construction (MiC) and Design for Manufacture and Assembly (DfMA), and piloted construction phase carbon neutrality with the Organic Resources Recovery Centre Phase 2 project [147] - Social Welfare: In 2021, volunteer participation exceeded 2,800 person-times, with over 11,000 service hours, and the flagship 'Thousands of Homes Renovation' project completed over 480 households during the year [150][152] - Investor Relations: Met with over 200 investors during the year, with a significant increase in Stock Connect shareholding, and received multiple awards including 'Most Honored Company' from Institutional Investor and 'Best IR Hong Kong Stock Company' from New Fortune [163][164] Employee Development and Personal Growth Environmental Policy Social Welfare Investor Relations Board of Directors and Executive Structure This section details the backgrounds and qualifications of the company's Board of Directors and senior management, comprising experienced professionals across various fields, providing strong support for the Group's strategic execution and daily operations - Chairman and Non-Executive Director Mr. Yan Jianguo possesses approximately 32 years of experience in investment management for construction and real estate enterprises, also serving as Chairman of China Overseas Land & Investment (0688.HK) [171] - Executive Director and CEO Mr. Zhang Haipeng joined China State Construction Group in 2000, bringing over 22 years of experience in construction project management [173] - The independent non-executive director team comprises Mr. Li Minqiao, Dr. Leung Hoi Ming, Mr. Li Shing Che, and Ms. Wong Wai Ching, all senior professionals in their respective fields, providing independent judgment and professional advice to the Board [174][175][176] Corporate Governance Report This report outlines the company's 2021 compliance with the Hong Kong Stock Exchange's Corporate Governance Code, detailing the Board's composition, committee operations, risk management, internal controls, and shareholder communication to ensure high governance standards - The company complied with all code provisions of the Corporate Governance Code during the reporting period [188] - The Board of Directors comprises nine directors, including four independent non-executive directors, meeting listing rule requirements, with the roles of Chairman and CEO held by different individuals to ensure checks and balances [189][197] - The Board is responsible for the Group's risk management and internal control systems, having conducted an annual review and confirmed their effectiveness and adequacy [212] - The company adopted a shareholder communication policy, engaging with shareholders through various channels such as general meetings, annual reports, announcements, and the company website, safeguarding shareholder rights [218] Directors' Report The Directors' Report reviews the Group's 2021 business, financial performance, and governance, recommending a final dividend of 20.5 HK cents per share, disclosing key risks and management measures, and covering statutory information like share repurchases and major shareholder holdings - The Board recommended a final dividend of 20.5 HK cents per share, bringing the total annual dividend, including interim dividend, to 40.5 HK cents [222] - During the year, the company repurchased a total of 11,540,000 ordinary shares on the Stock Exchange for a total consideration of approximately HKD 54.72 million, all of which have been cancelled [234] - The Group issued USD 500 million in subordinated guaranteed perpetual capital securities and a total of RMB 2.5 billion in medium-term notes in Mainland China to optimize debt structure and supplement working capital [236][237] - As of December 31, 2021, controlling shareholder China Overseas Holdings Limited (COHL) held approximately 64.81% of the company's shares [249] Connected Transactions This section details the Group's significant and continuing connected transactions in 2021, including joint ventures, factoring arrangements, and various sub-contracting and financial service agreements with related parties, confirming compliance with listing rules - Formed a joint venture with China Overseas Land & Investment to jointly develop a Zhuhai project, with a total capital commitment of approximately RMB 11.4 billion, of which the company holds a 20% equity interest [259] - Signed sub-contracting agreements with China State Construction Engineering Corporation, with the total contract value awarded by the Group to China State Construction Engineering Corporation in 2021 being RMB 9.803 billion, below the annual cap of RMB 55 billion [264] - Signed general contracting agreements with China Overseas Land & Investment Group, with the total contract value awarded in 2021 being HKD 7.366 billion, below the revised annual cap of HKD 20 billion [280] - Entered into financial services agreements with China State Construction Finance, with the maximum daily deposit balance placed with China State Construction Finance in 2021 being RMB 0.806 billion, not exceeding the annual cap of RMB 1.2 billion [275] Financial Statements and Notes Independent Auditor's Report Auditor Ernst & Young issued an unmodified opinion on the Group's 2021 consolidated financial statements, highlighting key audit matters such as revenue recognition, impairment assessment of receivables and contract assets, and impairment assessment of concession rights - Auditor Ernst & Young issued an unmodified audit opinion [287] - Key audit matters include: - Revenue recognition for construction contracts: Involves significant judgments and estimates regarding total project revenue and costs - Impairment assessment of trade and other receivables and contract assets: These assets constitute approximately 51% of total assets, and their recoverability assessment involves significant judgment - Impairment assessment of concession rights: The assessment of recoverable amounts involves significant assumptions regarding future traffic volumes, toll levels, and discount rates [289][290][291][292] Consolidated Statement of Profit or Loss In 2021, the Group's turnover increased by 23.8% to HKD 77.31 billion, gross profit grew by 29.1% to HKD 11.98 billion, and profit attributable to shareholders rose 13.1% to HKD 6.80 billion Consolidated Statement of Profit or Loss Summary (As of December 31) | Indicator (HKD thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Turnover | 77,309,614 | 62,458,009 | | Gross Profit | 11,982,743 | 9,284,159 | | Profit Before Tax | 9,385,178 | 8,244,476 | | Profit for the Year | 7,435,884 | 6,484,174 | | Profit Attributable to Owners of the Company | 6,800,879 | 6,015,368 | | Basic Earnings Per Share (HK cents) | 134.94 | 119.14 | Consolidated Statement of Comprehensive Income In 2021, the Group recorded a profit for the year of HKD 7.44 billion, with other comprehensive income of HKD 2.44 billion primarily from exchange differences, resulting in a total comprehensive income of HKD 9.96 billion Consolidated Statement of Comprehensive Income Summary (As of December 31) | Indicator (HKD thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Profit for the Year | 7,435,884 | 6,484,174 | | Other Comprehensive Income (net of tax) | 2,527,356 | 2,636,741 | | Of which: Exchange differences arising from translation | 2,436,320 | 2,605,314 | | Total Comprehensive Income for the Year | 9,963,240 | 9,120,915 | | Total Comprehensive Income Attributable to Owners of the Company | 9,327,246 | 8,597,603 | Consolidated Statement of Financial Position As of December 31, 2021, total assets grew to HKD 219.3 billion, total liabilities were HKD 153.1 billion, and shareholders' equity reached HKD 66.2 billion, with total borrowings at HKD 70.3 billion and a net gearing ratio of 69.4% Consolidated Statement of Financial Position Summary (As of December 31) | Indicator (HKD thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Total Assets | 219,284,425 | 186,811,307 | | Non-current Assets | 105,327,522 | 98,804,266 | | Current Assets | 113,956,903 | 88,007,041 | | Total Liabilities | 153,068,154 | 128,531,760 | | Current Liabilities | 92,922,448 | 79,939,492 | | Non-current Liabilities | 60,145,706 | 48,592,268 | | Total Equity | 66,216,271 | 58,279,547 | | Equity Attributable to Owners of the Company | 56,446,165 | 49,093,774 | Consolidated Statement of Changes in Equity In 2021, equity attributable to owners of the company increased from HKD 49.09 billion to HKD 56.45 billion, driven by profit and exchange reserve increases, alongside perpetual capital securities issuance, dividend payments, and share repurchases Changes in Equity Attributable to Owners of the Company (HKD thousands) | Item | Amount | | :--- | :--- | | As at January 1, 2021 | 49,093,774 | | Total Comprehensive Income for the Year | 9,327,246 | | Equity-settled share-based payment | 44,540 | | Dividends paid | (1,964,670) | | Repurchase and cancellation of shares | (54,725) | | As at December 31, 2021 | 56,446,165 | Consolidated Statement of Cash Flows In 2021, net cash outflow from operating activities significantly narrowed to HKD 0.55 billion, net cash outflow from investing activities was HKD 4.94 billion, and net cash inflow from financing activities was HKD 6.96 billion, increasing year-end cash to HKD 24.34 billion Consolidated Statement of Cash Flows Summary (As of December 31) | Indicator (HKD thousands) | 2021 | 2020 | | :--- | :--- | :--- | | Net cash used in operating activities | (551,492) | (4,531,608) | | Net cash (used in)/from investing activities | (4,937,629) | 324,540 | | Net cash from financing activities | 6,963,633 | 2,881,279 | | Increase/(decrease) in cash and cash equivalents | 1,474,512 | (1,325,789) | | Cash and cash equivalents at beginning of year | 22,411,689 | 22,600,362 | | Effect of foreign exchange rate changes | 453,670 | 1,137,116 | | Cash and cash equivalents at end of year | 24,339,871 | 22,411,689 | Notes to the Consolidated Financial Statements The notes to the financial statements provide detailed explanations of accounting policies, estimates, and financial items, highlighting Mainland China as the largest revenue source, significant trade and other receivables, increased borrowings for expansion, and detailed related party transactions - Segment information indicates that Mainland China, Hong Kong, and Macau are the primary markets, contributing 52.4%, 30.8%, and 10.9% respectively to the Group's turnover [73] - Total trade and other receivables amounted to HKD 113.67 billion, with the non-current portion being HKD 54.43 billion, primarily originating from Mainland China construction-related investment projects, expected to be gradually recovered from 2023 to 2031 [469][470] - Total borrowings (including bank borrowings, guaranteed notes, and corporate bonds) amounted to HKD 70.34 billion, with RMB borrowings accounting for 81% to hedge exchange rate risks of Mainland China operations [86][495] Five-Year Financial Summary The five-year financial summary demonstrates the Group's continuous growth from 2017 to 2021, with turnover increasing from HKD 50.15 billion to HKD 77.31 billion, profit attributable to shareholders from HKD 5.49 billion to HKD 6.80 billion, and net assets from HKD 38.46 billion to HKD 66.22 billion Five-Year Financial Summary (2017-2021) | Indicator (HKD thousands) | 2017 | 2018 | 2019 | 2020 | 2021 | | :--- | :--- | :--- | :--- | :--- | :--- | | Turnover | 50,152,524 | 55,626,304 | 61,669,678 | 62,458,009 | 77,309,614 | | Profit Attributable to Owners of the Company | 5,490,091 | 4,500,148 | 5,413,208 | 6,015,368 | 6,800,879 | | Total Assets | 118,518,273 | 136,122,091 | 161,423,903 | 186,811,307 | 219,284,425 | | Net Assets | 38,462,911 | 43,078,250 | 50,907,565 | 58,279,547 | 66,216,271 | Information on Major Investment Properties This section lists the Group's major commercial investment properties in Macau, Mainland China (Zhuhai, Zhenjiang), and Hong Kong, all 100% owned, providing stable rental income - The Group's major investment properties are all for commercial use, located in prime areas of Hong Kong, Macau, and Mainland China, contributing rental income to the Group [547]