安阳钢铁(600569) - 2022 Q2 - 季度财报

Company Overview and Key Financial Indicators Company Profile and Key Financial Indicators Anyang Iron & Steel Co., Ltd. (600569) experienced a significant performance decline in H1 2022, with operating revenue down 14.39% and net profit turning to a loss of 863 million CNY Key Accounting Data and Financial Indicators for H1 2022 | Key Accounting Data | Current Period (Jan-Jun) (CNY) | Prior Period (CNY) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 20,712,706,748.19 | 24,193,781,004.42 | -14.39 | | Net Profit Attributable to Parent Company Shareholders | -863,185,051.72 | 770,433,969.68 | -212.04 | | Net Cash Flow from Operating Activities | 912,439,609.30 | 960,846,636.18 | -5.04 | | Key Financial Indicators | Current Period (Jan-Jun) | Prior Period | YoY Change (%) | | Basic EPS (CNY/share) | -0.301 | 0.268 | -212.31 | | Weighted Average ROE (%) | -8.29% | 7.44% | Decrease of 15.73 percentage points | | Asset Status | End of Current Period (CNY) | End of Prior Year (CNY) | Change from Prior Year-End (%) | | Net Assets Attributable to Parent Company Shareholders | 9,992,412,563.04 | 10,843,099,349.48 | -7.85 | | Total Assets | 47,548,107,702.71 | 45,772,681,366.80 | 3.88 | - During the reporting period, the company's total non-recurring gains and losses amounted to 1,773,965.77 CNY, primarily from government subsidies, after deducting fair value changes in financial assets, non-operating expenses, and related tax impacts[24][27] Management Discussion and Analysis Industry and Main Business The company, an integrated steel producer, faced severe industry challenges in H1 2022 from global factors, epidemics, and weak demand, yet maintained overall stable operations - The company's main business involves the production and operation of various steel products, including medium-thick plates, hot-rolled coils, cold-rolled coils, high-speed wire rods, building materials, and profiles[29] - In the first half of 2022, the steel industry faced multiple challenges, including a severe international situation, frequent domestic epidemics, disrupted supply chains, volatile raw material prices, and weak market demand[29] Core Competitiveness Analysis The company enhanced its core competitiveness in H1 2022 through new product R&D, brand building, and intellectual property, including developing 35 new steel grades and securing provincial science and technology awards - New Product R&D: In the first half, 35 new steel grades were developed, primarily high-end products such as high magnetic induction silicon steel, high-strength normalized shipbuilding plates, and high-strength lightweight automotive rim steel[30][32] - Brand Building: Successfully completed re-certification with British and American classification societies and supervision audits by China Classification Society, with multiple products receiving Gold Cup Special Excellence or Quality Product titles, and leading or participating in the formulation of 9 industry and group standards[32] - Intellectual Property: In the first half, 145 national patents were applied for, with 72 patents granted, an increase of 157%; the "Research and Application of Key Technologies for Industrialization of High-Strength Steel for Coal Mine Hydraulic Supports" project received the Second Prize of Henan Provincial Science and Technology Progress Award[32] Discussion and Analysis of Operations In H1 2022, the company faced operational losses due to reduced steel production/sales, falling prices, and high raw material costs, responding with cost reduction and green initiatives while navigating macroeconomic, financial, and environmental risks - The company's operating performance in the first half of 2022 resulted in a loss, primarily due to production capacity limitations and decreased steel output and sales caused by environmental controls and the pandemic, coupled with declining steel prices and high raw material costs for iron ore and coal[37] - The company implemented multiple countermeasures, including building a comprehensive cost reduction system, promoting deep-level systemic potential tapping, developing multi-channel marketing for value creation, fully commissioning environmental upgrade projects, rapidly advancing low-carbon circular projects, and enhancing the precision of operational control[33][34][36] - The company's main risks include demand contraction and price declines due to macroeconomic fluctuations; increased operational difficulties and financial risks from challenging and expensive industry financing; and environmental production restrictions stemming from increasingly stringent environmental requirements and carbon peak/neutrality goals[48][49] Main Business Analysis Key financial indicators showed negative changes, with operating revenue down 14.39%, gross profit margins squeezed, and net cash flow from financing activities sharply dropping 89.15% due to increased bank acceptance bill deposits Analysis of Changes in Financial Statement Items | Item | Current Period (CNY) | Prior Period (CNY) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 20,712,706,748.19 | 24,193,781,004.42 | -14.39 | | Operating Cost | 20,335,453,606.95 | 21,465,713,448.98 | -5.27 | | Selling Expenses | 83,773,840.74 | 105,842,928.37 | -20.85 | | Administrative Expenses | 467,657,149.76 | 479,709,636.32 | -2.51 | | Financial Expenses | 244,637,519.96 | 286,337,367.28 | -14.56 | | R&D Expenses | 660,308,004.53 | 705,302,170.18 | -6.38 | | Net Cash Flow from Operating Activities | 912,439,609.30 | 960,846,636.18 | -5.04 | | Net Cash Flow from Investing Activities | -647,338,705.89 | -1,987,144,660.19 | N/A | | Net Cash Flow from Financing Activities | 44,291,348.50 | 408,076,854.54 | -89.15 | Analysis of Assets and Liabilities Total assets reached 47.548 billion CNY, up 3.88% from prior year-end, with significant shifts in asset-liability structure, notably a 209.14% increase in long-term borrowings and a 117.03% rise in deferred income tax assets Changes in Assets and Liabilities | Item | Amount at Period-End (CNY) | Change from Prior Year-End (%) | Explanation | | :--- | :--- | :--- | :--- | | Receivables Financing | 419,649,351.49 | -61.88% | Decrease in bank acceptance bills received | | Other Current Assets | 120,381,261.50 | -79.76% | Decrease in VAT to be deducted, prepaid income tax | | Deferred Income Tax Assets | 501,140,072.99 | 117.03% | Recognition of deductible losses | | Payroll Payable | 64,672,446.07 | -49.98% | Payment of payroll | | Long-term Borrowings | 2,078,553,152.59 | 209.14% | Increase in long-term borrowings | | Lease Liabilities | 574,140,235.67 | 36.66% | Increase in direct finance lease business | | Long-term Payables | 2,433,855,762.19 | 45.75% | Increase in sale-leaseback business | | Retained Earnings | 777,525,621.07 | -52.61% | Decrease in profit | Analysis of Major Holding and Participating Companies Operating performance of major subsidiaries diverged, with Angang Group Cold Rolling Co., Ltd. achieving 63.04 million CNY net profit, while Yongtong Ductile Iron Pipe and Zhoukou Steel incurred significant losses Financial Summary of Major Holding and Participating Companies (Unit: Million CNY) | Company Name | Equity Ratio | Net Assets (Million CNY) | Net Profit (Million CNY) | | :--- | :--- | :--- | :--- | | Angang Group Yongtong Ductile Iron Pipe Co., Ltd. | 78.14% | 612.75 | -19.95 | | Anyang Iron & Steel Construction Co., Ltd. | 100.00% | 329.80 | 7.68 | | Angang Group Cold Rolling Co., Ltd. | 95.45% | 1,879.51 | 63.04 | | Henan Angang Zhoukou Steel Co., Ltd. | 76.92% | 2,371.08 | -97.60 | Environmental and Social Responsibility Environmental Information The company, a key polluting entity, strictly adheres to environmental regulations, completing multiple treatment projects, achieving 100% solid waste utilization, and actively pursuing energy conservation and emission reduction initiatives H1 2022 Major Pollutant Emissions (Anyang Headquarters) | Major Pollutant | Total Emissions (tons/half-year) | Permitted Total Emissions (tons/year) | | :--- | :--- | :--- | | Particulate Matter | 1371.142 | 3493.261103 | | Sulfur Dioxide | 338.447 | 3146.77249 | | Nitrogen Oxides | 1159.657 | 6256.925898 | | COD | 12.887 | 739.85 | | Ammonia Nitrogen | 1.617 | 73.985 | H1 2022 Major Pollutant Emissions (Angang Zhoukou Company) | Major Pollutant | Total Emissions (tons/half-year) | Permitted Total Emissions (tons/year) | | :--- | :--- | :--- | | Particulate Matter | 420.90 | 749.645 | | Sulfur Dioxide | 124.66 | 445.76 | | Nitrogen Oxides | 292.44 | 813.68 | - The company continuously pursued energy conservation and consumption reduction, increasing converter gas recovery per ton of steel by 13.5 m³ year-on-year, and advancing multiple energy-saving projects such as converter/electric furnace waste heat utilization and full recovery of blast furnace top equalizing gas[78] - In the first half, multiple environmental pollution control projects were completed and commissioned, including deep desulfurization and denitrification upgrades for 7-11 gas-fired boiler flue gas and deep desulfurization and denitrification treatment for 1-3 blast furnace hot blast stoves[67] Social Responsibility The company actively fulfills social responsibilities by consolidating poverty alleviation and promoting rural revitalization in designated villages through various initiatives, including consumption assistance and infrastructure improvements, with future plans focusing on industrial and talent development - Through consumption assistance, the company purchased 190,000 jin (95,000 kg) of peaches from designated assistance villages in June 2022, directly increasing villagers' income[80] - Practical actions for the public included Spring Festival condolences/visits, voluntary tree planting, honoring moral models, assisting with summer wheat harvest, and improving living environments, which enhanced rural civilization and environmental standards[83] Significant Matters Fulfillment of Commitments The company's actual controller, shareholders, and related parties strictly fulfilled commitments regarding avoiding horizontal competition, regulating related-party transactions, and ensuring the listed company's independence - Henan Machinery Equipment Investment Group Co., Ltd. committed that during its control over the company, it would not engage in businesses competing with the company, regulate related-party transactions, and ensure the listed company's independence[87][90][93] - Controlling shareholder Angang Group committed that during its tenure as controlling shareholder, it would not directly or indirectly participate in any business activities competing with the company, and promised that the company would have priority acquisition rights for Wuyang Mining Company under equivalent conditions[97] Significant Related-Party Transactions Significant related-party transactions involved purchasing raw materials (e.g., 2.635 billion CNY from Angang Group International Trade) and selling products (e.g., 1.491 billion CNY to Anyang Yilian Logistics), all conducted at market prices Major Related-Party Purchase Transactions | Related Party | Transaction Content | Transaction Amount (CNY) | Proportion of Similar Transactions (%) | | :--- | :--- | :--- | :--- | | Angang Group International Trade Co., Ltd. | Iron Ore | 2,635,407,732.96 | 12.96 | | Anyang Yilian Logistics Co., Ltd. | Coal | 1,382,397,043.29 | 6.80 | | Henan Steel Holding Group Co., Ltd. | Coal, Coke, Alloys, Ores, etc. | 909,207,295.36 | 4.47 | Major Related-Party Sales Transactions | Related Party | Transaction Content | Transaction Amount (CNY) | Proportion of Similar Transactions (%) | | :--- | :--- | :--- | :--- | | Anyang Yilian Logistics Co., Ltd. | Steel Products | 1,490,761,823.45 | 7.20 | | Henan Diheng Industrial Co., Ltd. | Steel Products | 744,898,598.57 | 3.60 | | Angang Group Affiliated Enterprises Co., Ltd. | Steel Products, Scrap/Substandard Materials | 583,665,615.78 | 2.82 | Share Changes and Shareholder Information Share Capital Changes The company's share capital and equity structure remained unchanged, except for the lifting of restrictions on 478,736,897 shares held by the controlling shareholder on May 31, 2022 - The 478,736,897 restricted shares held by controlling shareholder Angang Group Co., Ltd., originating from a non-public offering, were unlocked on May 31, 2022[114] Shareholder Information As of period-end, the company had 98,031 common shareholders, with the top two, Angang Group and Henan Machinery Equipment Investment Group (parties acting in concert), holding a combined 66.78% stake, and 550 million Angang Group shares pledged Top Ten Shareholders' Shareholding | Shareholder Name | Shares Held at Period-End | Proportion (%) | Share Status | | :--- | :--- | :--- | :--- | | Angang Group Co., Ltd. | 1,343,824,209 | 46.78 | Pledged 550,000,000 | | Henan Machinery Equipment Investment Group Co., Ltd. | 574,484,277 | 20.00 | Unknown | | Zhejiang Yiwu Tanzhen Investment Management Partnership... | 10,806,300 | 0.38 | Unknown | | Wu Zi'an | 10,200,000 | 0.36 | Unknown | - Angang Group Co., Ltd. and Henan Machinery Equipment Investment Group Co., Ltd. are parties acting in concert[119] Financial Report Financial Statements Financial statements reveal H1 2022 losses, with operating revenue down 14.4% to 20.713 billion CNY, a net loss of 863 million CNY, total assets at 47.548 billion CNY, and financing cash flow significantly reduced to 44 million CNY Consolidated Income Statement Summary (Jan-Jun 2022) | Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | | :--- | :--- | :--- | | I. Total Operating Revenue | 20,712,706,748.19 | 24,193,781,004.42 | | II. Total Operating Cost | 21,884,010,432.61 | 23,200,283,674.16 | | III. Operating Profit | -1,163,779,884.06 | 1,005,925,626.59 | | IV. Total Profit | -1,173,780,890.32 | 1,003,991,401.67 | | V. Net Profit | -887,156,024.54 | 788,817,375.83 | | Net Profit Attributable to Parent Company Shareholders | -863,185,051.72 | 770,433,969.68 | Consolidated Balance Sheet Summary (As of June 30, 2022) | Item | Period-End Balance (CNY) | Period-Beginning Balance (CNY) | | :--- | :--- | :--- | | Total Assets | 47,548,107,702.71 | 45,772,681,366.80 | | Total Liabilities | 36,787,419,915.85 | 34,137,335,820.68 | | Total Equity Attributable to Parent Company Owners | 9,992,412,563.04 | 10,843,099,349.48 | | Total Liabilities and Owners' Equity | 47,548,107,702.71 | 45,772,681,366.80 | Consolidated Cash Flow Statement Summary (Jan-Jun 2022) | Item | Current Period Amount (CNY) | Prior Period Amount (CNY) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 912,439,609.30 | 960,846,636.18 | | Net Cash Flow from Investing Activities | -647,338,705.89 | -1,987,144,660.19 | | Net Cash Flow from Financing Activities | 44,291,348.50 | 408,076,854.54 | | Net Increase in Cash and Cash Equivalents | 311,545,379.56 | -618,736,765.21 | Notes to Financial Statements (Excerpt) Financial statement notes detail accounting policies, consolidation scope (7 subsidiaries), and key items, including 8.53 billion CNY in monetary funds (6.864 billion CNY restricted), 12.725 billion CNY in inventory, 2.734 billion CNY in construction in progress, and significant finance lease commitments - As of period-end, the company's monetary funds balance was 8.53 billion CNY, of which 6.864 billion CNY was restricted, primarily comprising bank acceptance bill deposits (5.108 billion CNY) and letter of credit deposits (1.696 billion CNY)[318][321] - The book value of inventory at period-end was 12.725 billion CNY, a significant increase from 10.802 billion CNY at the beginning of the period, with the main growth attributed to work-in-progress and finished goods[356] - The book value of construction in progress at period-end was 2.732 billion CNY, with major projects including the Zhoukou Industrial Park capacity replacement project, sintering machine flue gas desulfurization and denitrification project, and Angang electromagnetic new materials project[379] - The company has multiple significant finance lease commitments, involving sale-leaseback and direct lease transactions with various institutions such as CCB Financial Leasing, Kunlun Financial Leasing, and Cinda Financial Leasing, representing a key financing method for the company[563][564][566]