深高速(600548) - 2021 Q4 - 年度财报

Definitions This chapter provides definitions and explanations for professional terms, company name abbreviations, project names, and industry-specific vocabulary used throughout the report Company Profile and Key Financial Indicators This section provides an overview of the company's fundamental information, stock details, and a comprehensive analysis of its key financial performance and indicators over the past three years Company Information and Stock Overview Shenzhen Expressway Company Limited (SZEC) is an A+H share listed company registered in Shenzhen, with Hu Wei as its legal representative, listed on SSE and HKEX - Company's Chinese abbreviation is 深高速 (Shenzhen Expressway), and its legal representative is Hu Wei[18] Stock Information | Stock Type | Listing Exchange | Stock Abbreviation | Stock Code | | :--- | :--- | :--- | :--- | | A-share | Shanghai Stock Exchange | Shenzhen Expressway | 600548 | | H-share | The Stock Exchange of Hong Kong Limited | Shenzhen Expressway | 00548 | Key Accounting Data and Financial Indicators for the Past Three Years In 2021, the company achieved significant performance growth, with operating revenue increasing by 35.45% to RMB 10.872 billion, and net profit attributable to shareholders increasing by 26.85% to RMB 2.606 billion Key Accounting Data (RMB) | Key Accounting Data | 2021 | 2020 | Period-on-Year Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 10,871,924,008.52 | 8,026,737,099.99 | 35.45 | | Net Profit Attributable to Listed Company Shareholders | 2,606,254,756.43 | 2,054,523,306.30 | 26.85 | | Net Cash Flow from Operating Activities | 3,941,530,767.73 | 1,100,633,933.07 | 258.11 | | Net Assets Attributable to Listed Company Shareholders | 24,638,965,669.92 | 23,042,941,782.92 | 6.93 | | Total Assets | 60,613,494,756.12 | 55,144,962,042.63 | 9.92 | Key Financial Indicators | Key Financial Indicators | 2021 | 2020 | Period-on-Year Change (%) | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (RMB/share) | 1.110 | 0.936 | 18.59 | | Weighted Average Return on Net Assets (%) | 12.24 | 10.83 | Increased by 1.41 percentage points | 2021 Quarterly Key Financial Data (RMB) | Indicator | Q1 | Q2 | Q3 | Q4 | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 1,962,015,531.22 | 2,249,122,448.62 | 2,414,993,814.35 | 4,245,792,214.33 | | Net Profit Attributable to Listed Company Shareholders | 540,534,999.13 | 678,796,456.73 | 708,364,351.34 | 678,558,949.23 | Annual Events This section highlights the company's significant milestones and strategic developments throughout the year, including major project advancements, acquisitions, financing activities, and key governance decisions Review of Major Annual Events 2021 was a pivotal year for the company's strategic development, achieving significant progress in project construction, business acquisitions, financing activities, and corporate governance, including the commencement of the Jihe Expressway expansion, acquisition of Xinjiang Mulei wind power projects, issuance of USD 300 million bonds, and initiation of a strategic acquisition of Bay Area Development's controlling stake - In January, the pilot section of the Jihe Expressway expansion project commenced, and 100% equity of Xinjiang Mulei 'Qianzhi Company' and 'Qianhui Company' was acquired[38] - In March, a Memorandum of Understanding was signed with Shenzhen Investment Holdings, proposing to acquire 71.83% equity of Bay Area Development[38] - In July, USD 300 million bonds were successfully issued[39] - In December, the proposal to acquire 100% equity of Shenzhen Investment Holdings Infrastructure via non-public agreement and the company's '14th Five-Year (2021-2025) Development Strategy' were both approved by the general meeting of shareholders[40] Chairman's Address This section presents the Chairman's review of the company's annual performance, key achievements, and strategic vision for future development, emphasizing core business consolidation and new growth opportunities Performance Review and Future Outlook Chairman Hu Wei summarized 2021 operating performance, with operating revenue of RMB 10.872 billion and net profit of RMB 2.606 billion, proposing a final dividend of RMB 0.62 per share, while outlining future strategies focusing on toll road expansion and environmental protection 2021 Performance Overview | Indicator | Amount | Year-on-Year Growth | | :--- | :--- | :--- | | Operating Revenue | RMB 10.872 billion | 35.45% | | Net Profit | RMB 2.606 billion | 26.85% | | Earnings Per Share | RMB 1.110 | - | | Proposed Final Dividend | RMB 0.62 per share | - | - Business Review: In 2021, the company achieved targets in key project construction, highway operations, project acquisitions, and financing activities, notably the successful strategic acquisition of Hong Kong-listed Bay Area Development[42] - Future Outlook: The toll road industry has entered a mature phase, with expansion and reconstruction becoming important investment opportunities, while the environmental protection industry is experiencing significant development opportunities under the 'dual carbon' goals, with the company focusing on organic waste treatment, hazardous waste disposal, and clean energy generation[44] - The company formulated its '14th Five-Year (2021-2025) Development Strategy', centered on toll roads and environmental protection as dual core businesses, aiming to become a leading infrastructure construction and operation service provider[46] Management Discussion and Analysis This section provides an in-depth analysis of the company's business operations, industry landscape, core competencies, key operating performance, and future development strategies, including identified risks and mitigation plans Company Business and Industry Overview The company primarily invests in, constructs, and manages toll roads and environmental protection businesses, having established a dual-core business structure and multiple platforms, with the toll road industry shifting to maturity and environmental protection facing significant opportunities under 'dual carbon' strategies - The company is positioned as an urban and transportation infrastructure construction and operation service provider, having formed a dual-core business structure of toll roads and environmental protection[48][51] - The toll road industry has entered a mature phase, with fewer high-quality new projects, but core road asset expansion and reconstruction present historical opportunities[57] - Driven by 'dual carbon' strategic goals, the solid waste resource treatment and clean energy industries face significant market opportunities, and the company has initially completed its industrial layout in these two areas[59][61][63] Business Operations During the Reporting Period In 2021, the company achieved operating revenue of RMB 10.872 billion, with toll revenue of RMB 5.893 billion (54.2%) and environmental business revenue of RMB 1.793 billion (16.5%), driven by normalized toll road operations and strategic acquisitions in environmental protection 2021 Operating Revenue Composition | Business Segment | Revenue (RMB billion) | Share of Total Revenue (%) | | :--- | :--- | :--- | | Toll Revenue | 5.893 | 54.20 | | Environmental Business Revenue | 1.793 | 16.50 | | Other Revenue | 3.186 | 29.30 | | Total | 10.872 | 100.00 | - Toll Road Business: Outer Ring Project Phase I performed well, with average daily toll revenue of approximately RMB 2.52 million; traffic volume on Yanjiang Expressway and Longda Expressway maintained good growth, and the company completed the acquisition of a controlling stake in Bay Area Development in January 2022, further consolidating its core advantages[73][81][82] - Environmental Protection Business: In solid waste resource utilization, 6 existing Lande Environmental projects entered commercial operation, and the Guangming Environmental Park project was signed and commenced construction; in clean energy, the acquisition of three Xinjiang Mulei wind power projects (totaling 299MW) was completed, bringing the group's total controlled wind power installed capacity to 648MW[84][86][88] - Industry-Finance Integration: Increased equity in the financial leasing company to 90.25%, providing synergistic support for the expansion of the environmental protection core business, and holds approximately 3.44% stake in Bank of Guizhou, generating stable investment income[99] Analysis of Core Competencies During the Reporting Period The company's core competencies are primarily its Greater Bay Area infrastructure state-owned asset platform advantage, integrated management capabilities, innovation capabilities, and strong financing platform, enabling strategic project acquisition and efficient operations - Greater Bay Area Infrastructure State-owned Asset Platform Advantage: As a platform under Shenzhen State-owned Assets, the company has an advantage in acquiring high-quality projects within the region, exemplified by the successful controlling acquisition of Bay Area Development[103] - Integrated Management Capabilities: The company possesses comprehensive management capabilities from investment to operation, extending these capabilities to new business areas such as solid waste resource management and clean energy[104] - Innovation Capabilities: Continuous innovation in business models (e.g., PPP, capital-funded development + land development) and technology application (e.g., intelligent transportation, smart environmental protection), with 333 patent authorizations by the end of 2021[105] - Strong Financing Platform: Possesses A+H shares and Bay Area Development, three listing platforms, high domestic and international credit ratings, diverse and cost-effective financing channels[105] Key Operating Performance During the Reporting Period In 2021, the group's net profit attributable to shareholders increased by 26.85% to RMB 2.606 billion, primarily due to contributions from new projects and recovery growth in toll road business, while maintaining a stable financial position despite increased financial expenses and decreased investment income Profit Statement and Cash Flow Statement Major Items Change (RMB thousands) | Item | Current Period (RMB thousands) | Prior Period (RMB thousands) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 10,871,924 | 8,026,737 | 35.45 | | Operating Cost | 7,080,446 | 5,214,517 | 35.78 | | Financial Expenses | 749,134 | 491,548 | 52.40 | | Investment Income | 570,093 | 937,363 | -39.18 | | Net Cash Flow from Operating Activities | 3,941,531 | 1,100,634 | 258.11 | - Revenue growth primarily stemmed from the newly opened Outer Ring Expressway Phase I, newly acquired Mulei Wind Power projects, recovery growth in existing toll roads, and recognition of construction service revenue under concession arrangements[109][111] - Investment income decreased mainly because of fewer property deliveries from joint venture United Land (Meilincun project), leading to a significant year-on-year decline in real estate development income[126][127] Key Financial Ratios | Key Indicator | End of 2021 | End of 2020 | | :--- | :--- | :--- | | Asset-Liability Ratio | 54.18% | 52.35% | | Net Debt-to-Equity Ratio | 68.95% | 61.18% | Discussion and Analysis of the Company's Future Development The company's '14th Five-Year' strategy aims to consolidate toll road advantages and expand into environmental protection and clean energy, targeting RMB 12 billion in 2022 operating revenue, with significant capital expenditure plans and identified risks including policy, operational, business expansion, financing, and construction management - '14th Five-Year' Strategic Goal: Deepen presence in the Greater Bay Area, striving to become a leading service provider in highway transportation and environmental protection infrastructure construction and operation[167] - 2022 Operating Target: Total operating revenue target of RMB 12 billion, with operating costs, administrative expenses, and selling expenses controlled at around RMB 6.36 billion[169] 2022-2024 Capital Expenditure Plan (Partial) (RMB thousands) | Project Name | 2022 (RMB thousands) | 2023 (RMB thousands) | 2024 (RMB thousands) | Total (RMB thousands) | | :--- | :--- | :--- | :--- | :--- | | Bay Area Development Acquisition | 5,363,930 | 1,992,311 | - | 7,356,241 | | Outer Ring Project | 454,726 | 644,867 | - | 1,099,593 | | Yanjiang Phase II | 641,180 | 271,875 | 12,000 | 925,055 | | Guangming Environmental Park PPP Project | 506,628 | 69,907 | - | 576,535 | - Major risks faced by the company include: policy risks (revision of toll road management regulations, stricter environmental regulations), operational management risks (ETC system, Jihe Expressway expansion impact), business expansion risks (scarcity of quality projects, intense market competition), financing risks (peak capital expenditure period), and construction management risks (multiple projects under simultaneous construction)[174][175][177][180][182][184] Corporate Governance This section details the company's corporate governance structure, including the roles of the board, supervisory committee, and management, along with information on directors, supervisors, senior management, employee matters, profit distribution, internal controls, and investor relations Corporate Governance Structure and Operation The company has established a governance structure comprising the general meeting of shareholders, board of directors, supervisory committee, and management, adhering to SSE and HKEX governance regulations, with five specialized committees effectively operating to ensure independence and proper decision-making - The company's governance structure consists of the general meeting of shareholders, board of directors, supervisory committee, and management, with five specialized committees established: Strategy, Audit, Remuneration, Nomination, and Risk Management[187][223] - During the reporting period, the company held 3 general meetings of shareholders, 16 board meetings, and 10 supervisory committee meetings, deliberating on important proposals such as annual reports, profit distribution, major investments, and amendments to the articles of association[195][215][239] - Each specialized committee of the board fulfilled its duties, for example, the Audit Committee reviewed periodic reports and internal control reports, the Remuneration Committee reviewed executive performance appraisal plans, and the Nomination Committee completed the nomination review for directors and executives[225][227][228] Directors, Supervisors, and Senior Management This chapter details the personal resumes, terms of office, shareholding changes, and remuneration of current and departed directors, supervisors, and senior management during the reporting period, with executive compensation linked to company performance Total Pre-tax Remuneration of Selected Executives in 2021 (RMB ten thousands) | Name | Position | Total Remuneration (RMB ten thousands) | | :--- | :--- | :--- | | Hu Wei | Chairman | 116.99 | | Liao Xiangwen | President | 140.40 | | Wang Zengjin | Executive Director | 126.81 | | Gong Taotao | Board Secretary | 127.90 | - During the reporting period, Chairman Hu Wei purchased 200,000 H-shares of the company[197] - The remuneration of the company's directors, supervisors, and senior management is determined based on relevant Chinese policies or regulations, considering market levels and the company's actual situation, with recommendations from the Board's Remuneration Committee and approval by the Board or General Meeting of Shareholders[213][245] Employee Information and Profit Distribution As of the end of the reporting period, the company had 7,105 employees, with 67.2% in toll collection, implementing a performance-based remuneration system and an active cash dividend policy, proposing RMB 0.62 per share for 2021 - As of the end of the reporting period, the group had a total of 7,105 employees, of whom 4,775 were toll collection personnel, accounting for 67.2%[240][241] - The Board recommended a final cash dividend of RMB 0.62 per share (including tax) for 2021, totaling approximately RMB 1.352 billion, representing 55.88% of net profit attributable to shareholders after excluding the impact of perpetual bonds[249] - The company formulated the '2021-2023 Shareholder Return Plan,' which stipulates that, when conditions are met, the profit distributed in cash shall not be less than 55% of the net profit attributable to shareholders in the consolidated financial statements for the year (after deducting the impact of perpetual bonds and other items)[250] Internal Control and Investor Relations The company maintains a sound and effective internal control system, with the Board confirming its effectiveness and Deloitte issuing an unqualified audit opinion, while actively managing investor relations through various communication channels - The Board issued the '2021 Annual Internal Control Evaluation Report,' concluding that the company maintained effective internal controls over financial reporting in all material aspects, with no significant deficiencies found[261][262] - Deloitte Touche Tohmatsu Certified Public Accountants LLP, engaged by the company, audited the effectiveness of the company's internal controls over financial reporting and issued an unqualified audit opinion[264] - The company communicated with investors through various channels, with over 610 interactions with investors and media reporters and approximately 30 analyst visits during the year[300][301] Environmental and Social Responsibility This section outlines the company's commitment to environmental protection and social welfare, detailing its ESG initiatives, efforts in green transformation, energy conservation, and active participation in community and rural revitalization programs ESG Work Progress The company actively fulfills its environmental and social responsibilities, prioritizing resource conservation and ecological protection through expanding environmental businesses and using energy-efficient equipment, while engaging in volunteer services and rural revitalization efforts - The company is committed to becoming a leading enterprise in specific environmental protection segments, actively promoting pollution control, ecological protection, and climate change response[309] - To reduce carbon emissions, the company adopted measures such as increasing wind power project development, using energy-efficient LED lights, and installing solar water heaters in buildings[310] - In 2021, the company conducted 54 volunteer services, accumulating 1,932 service hours, and dispatched employees to Da'an Town, Lufeng City, to participate in rural revitalization work[311][312] Significant Matters This section covers the fulfillment of key commitments, major related party transactions, significant contracts, and other important events during the reporting period, including acquisitions, bond issuances, and corporate name changes Fulfillment of Commitments During the reporting period, relevant parties strictly fulfilled their commitments, including the controlling shareholder's transfer of Bay Area Development equity to resolve horizontal competition, while Nanjing Wind Power, Lande Environmental, and Qiantai Company failed to meet 2021 performance commitments, leading to recognized compensation and goodwill impairment - To resolve horizontal competition, the company completed the acquisition of Shenzhen Investment Holdings Infrastructure on January 11, 2022, thereby indirectly controlling Bay Area Development and fulfilling the controlling shareholder's commitment[316] - Nanjing Wind Power's 2021 performance did not meet its commitment, with an estimated net loss of approximately RMB 113 million; the company recognized performance compensation receivable of approximately RMB 103 million, and accrued goodwill impairment of RMB 110 million[318] - Lande Environmental's 2021 performance did not meet its commitment, with an estimated net loss of approximately RMB 80 million; the company recognized performance compensation receivable of approximately RMB 105 million[320] - Qiantai Company's 2021 performance did not meet its commitment, with an estimated net profit of approximately RMB 2.73 million; the company recognized performance compensation receivable of approximately RMB 4.78 million[321] Major Related Party Transactions and Significant Contracts The most significant related party transaction was the company's acquisition of Shenzhen Investment Holdings Infrastructure for up to HKD 10.479 billion, indirectly controlling Bay Area Development, alongside other routine related party transactions and external guarantees totaling RMB 2.304 billion, representing 9.35% of net assets - Significant Related Party Transaction: The company, through its wholly-owned subsidiary Meihua Company, acquired 100% equity of Shenzhen Investment Holdings Infrastructure at a total cost not exceeding HKD 10.479 billion; this transaction was completed on January 11, 2022[333][334] External Guarantees (as of end of reporting period) (RMB millions) | Item | Amount (RMB millions) | | :--- | :--- | | Total Guarantee Balance at End of Reporting Period (A) (excluding guarantees to subsidiaries) | 1,258.12 | | Total Guarantee Balance to Subsidiaries at End of Reporting Period (B) | 1,046.23 | | Total Guarantees (A+B) | 2,304.35 | | Total Guarantees as % of Company's Net Assets | 9.35 | Other Significant Matters During the reporting period, the company extended the validity of its H-share issuance resolution, successfully issued USD 300 million overseas bonds and domestic green corporate bonds, initiated absorption mergers of subsidiaries, and changed its corporate name to 'Shenzhen Expressway Group Company Limited' - The validity period for the resolution on non-public issuance of up to 300 million H-shares was extended to March 30, 2022[352] - Successfully issued USD 300 million 5-year fixed-rate overseas bonds, and in China issued RMB 1.2 billion green corporate bonds and RMB 1 billion corporate bonds[353] - The company's name changed to 'Shenzhen Expressway Group Company Limited,' with relevant industrial and commercial changes approved on December 16, 2021[356] - Significant Investments: Completed the acquisition of three Xinjiang Mulei wind power projects totaling RMB 1.015 billion, and purchased part of the Hanjing Financial Center property for office use at RMB 1.559 billion[358][359] Share Changes and Shareholder Information This section provides details on the company's share capital structure, including total shares, A and H share proportions, total shareholder count, and information on the top shareholders, as well as the indirect controlling shareholder and ultimate controlling party Share Capital Structure and Shareholder Information During the reporting period, the company's total share capital and structure remained unchanged at 2.181 billion shares (65.72% A-shares, 34.28% H-shares), with 22,046 shareholders, and Shenzhen International as the indirect controlling shareholder - During the reporting period, the company's total number of shares and share capital structure remained unchanged, with a total share capital of 2,180,770,326 shares[380] Top Three Shareholders' Shareholding (as of end of reporting period) | Shareholder Name | Number of Shares Held | Proportion (%) | | :--- | :--- | :--- | | HKSCC NOMINEES LIMITED | 730,174,042 | 33.48 | | Xintongchan Industrial Development (Shenzhen) Co., Ltd. | 654,780,000 | 30.03 | | Shenzhen Shenguanghui Highway Development Co., Ltd. | 411,459,887 | 18.87 | - The company's indirect controlling shareholder is Shenzhen International Holdings Limited, and the ultimate controlling party is Shenzhen Municipal People's Government State-owned Assets Supervision and Administration Commission[396][399] Bond-Related Information This section provides a comprehensive overview of the company's bond issuances and debt financing instruments, including details on newly issued bonds, their terms, and the utilization of raised funds for project construction and debt repayment Corporate Bonds and Debt Financing Instruments As of the end of the reporting period, the company had outstanding enterprise bonds, corporate bonds (including green bonds), and non-financial enterprise debt financing instruments, having successfully issued multiple tranches totaling RMB 4 billion in super short-term commercial papers, RMB 1.2 billion green corporate bonds, RMB 1 billion corporate bonds, and USD 300 million overseas bonds, with proceeds used for project construction and debt repayment - New bonds issued during the reporting period include: RMB 1.2 billion 5-year green corporate bonds (G21 Shengao 1, interest rate 3.49%), RMB 1 billion 5-year corporate bonds (21 Shengao 01, interest rate 3.35%), and 4 tranches totaling RMB 4 billion in super short-term commercial papers[382][384][413] - The company issued USD 300 million 5-year fixed-rate overseas bonds in July 2021, with a coupon rate of 1.75%, listed and traded on the Hong Kong Stock Exchange[385] - Proceeds were used according to committed purposes, primarily for project construction (e.g., repayment of Mulei Wind Farm project loans), repayment of maturing debts, etc., with no instances of non-compliant use[407][416][417] Financial Report This section presents the company's audited financial statements, including the audit report, key financial performance indicators, and detailed notes to the financial statements, providing insights into accounting policies, estimates, and financial risks Audit Report Deloitte Touche Tohmatsu Certified Public Accountants LLP issued a standard unqualified audit opinion on the company's 2021 financial statements, confirming fair presentation in accordance with accounting standards, with 'amortization of concession rights related to toll roads' identified as a key audit matter due to significant estimates - The auditing firm is Deloitte Touche Tohmatsu Certified Public Accountants LLP, which issued a standard unqualified audit opinion[429][430] - A key audit matter is 'amortization of concession rights related to toll roads,' involving significant accounting estimates for predicting total traffic volume over the concession period[433] Major Financial Statements Financial statements show steady growth in the company's asset size and profitability, with total assets reaching RMB 60.613 billion (up 9.92%), operating revenue RMB 10.872 billion (up 35.45%), and net profit attributable to parent company shareholders RMB 2.606 billion (up 26.85%), alongside strong operating cash flow Consolidated Balance Sheet Major Items (RMB) | Item | December 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Total Assets | 60,613,494,756.12 | 55,144,962,042.63 | | Total Liabilities | 32,841,718,416.31 | 28,865,852,158.86 | | Total Equity Attributable to Parent Company Owners | 24,638,965,669.92 | 23,042,941,782.92 | Consolidated Income Statement Major Items (RMB) | Item | 2021 Annual | 2020 Annual | | :--- | :--- | :--- | | Total Operating Revenue | 10,871,924,008.52 | 8,026,737,099.99 | | Operating Profit | 3,134,481,421.07 | 2,712,660,568.49 | | Total Profit | 3,178,144,673.41 | 2,709,466,381.23 | | Net Profit Attributable to Parent Company Shareholders | 2,606,254,756.43 | 2,054,523,306.30 | Consolidated Cash Flow Statement Major Items (RMB) | Item | 2021 Annual | 2020 Annual | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 3,941,530,767.73 | 1,100,633,933.07 | | Net Cash Flow from Investing Activities | (5,133,455,901.43) | (4,430,831,833.69) | | Net Cash Flow from Financing Activities | 1,669,296,968.31 | 3,588,278,559.52 | Notes to Financial Statements (Summary) The notes explain financial statement items, including accounting policy adoptions with no material impact, a change in accounting estimate for Changsha Ring Road concession rights, expanded consolidation scope due to acquisitions, segment information highlighting toll business as the primary profit source, and management of foreign exchange and interest rate risks - Accounting Estimate Change: Effective October 1, 2021, the unit amortization amount for Changsha Ring Road concession rights was adjusted from RMB 5.09/vehicle to RMB 2.39/vehicle due to traffic volume differences, increasing current period net profit attributable to shareholders by approximately RMB 4.77 million[568][569][570] - Change in Consolidation Scope: During this period, new subsidiaries including Qianzhi Company, Qianhui Company, Qianxin Company, Shanghai Zhuneng, and Ningxia Zhongwei were added through non-common control business combinations[772] 2021 Annual Segment Financial Information Summary (RMB) | Item | Toll Business | Environmental Business | Other | Total | | :--- | :--- | :--- | :--- | :--- | | External Transaction Revenue | 5,892,744,166.13 | 1,794,627,021.29 | 3,184,552,821.10 | 10,871,924,008.52 | | Total Profit | 2,824,406,477.97 | 312,765,317.91 | (386,093,899.62) | 3,178,144,673.41 |