CISC(601005)2023-03-30 16:00Financial Performance - The net profit of Chongqing Iron & Steel Co., Ltd. for 2022 was -1.038 billion RMB, with retained earnings at -7.651 billion RMB by the end of 2022, leading to a recommendation not to distribute profits for the year [18]. - Basic earnings per share for 2022 was -0.11 RMB, a decrease of 142.31% compared to 0.26 RMB in 2021 [26]. - The company's operating revenue for 2022 was CNY 36,561,531, a decrease of 8.25% compared to CNY 39,849,418 in 2021 [51]. - The net profit attributable to shareholders was CNY -1,019,409, representing a decline of 144.82% from CNY 2,274,395 in the previous year [51]. - The total profit for the company was -1.202 billion RMB, a significant decline of 153.12% year-on-year [64]. - The average selling price of commodity billets was 4,048 RMB per ton, down 12.98% year-on-year, impacting revenue negatively by 5.018 billion RMB [64]. - The net profit attributable to shareholders after deducting non-recurring gains and losses for 2022 was -1,086,273 thousand RMB, a decrease of 144.28% compared to 2,453,197 thousand RMB in 2021 [200]. Revenue and Sales - Revenue from the steel industry was 36.274 billion RMB, a decrease of 3.18% year-on-year, with a gross margin reduction of 10.55 percentage points [43]. - The revenue from steel products was 33.932 billion RMB, with a year-on-year increase of 2.15%, but the gross margin decreased by 11.37 percentage points [43]. - Revenue from the Southwest region was 27.947 billion RMB, with a year-on-year increase of 13.72%, but the gross margin decreased by 10.80 percentage points [46]. - The company reported a significant decrease in revenue from other regions, down 35.41% year-on-year, totaling 8.327 billion RMB [46]. - The company achieved a sales volume of 8.3832 million tons of commodity billets, representing a year-on-year increase of 17.40% [62]. Cash Flow and Financial Position - The net cash flow from operating activities decreased primarily due to reduced net profit and the settlement of forward letters of credit [40]. - The net cash flow from operating activities was CNY 1,470,087, down 73.85% from CNY 5,621,433 in 2021 [51]. - The cash flow from financing activities decreased due to a reduction in new borrowings during the period [40]. - The total assets at the end of 2022 were CNY 39,364,800, a decrease of 8.45% from CNY 42,995,956 at the end of 2021 [51]. - The net assets attributable to shareholders were CNY 21,341,918, down 4.62% from CNY 22,375,211 in the previous year [51]. - The current ratio decreased by 25.29%, from 0.87 in 2021 to 0.65 in 2022 [200]. - The quick ratio decreased by 27.42%, from 0.62 in 2021 to 0.45 in 2022 [200]. - The asset-liability ratio improved by 2.18 percentage points, from 47.96% in 2021 to 45.78% in 2022 [200]. - The EBITDA to total debt ratio decreased by 83.78%, from 0.37 in 2021 to 0.06 in 2022, indicating a significant reduction in profitability [200]. Production and Operational Metrics - The company achieved record production levels for steel and materials, marking a significant milestone in its high-quality development [55]. - The company achieved a steel production of 7.8735 million tons in 2022, marking a historical high, with the cost of slab steel production dropping to 488 RMB/ton in November, a record low [56]. - The company’s steel rolling output reached 8.33 million tons in 2022, an increase of 17.82% year-on-year, also a historical high [56]. - The company’s comprehensive production capacity reached 12 million tons in 2022, following the completion of production line adjustments and supporting projects [56]. - The company’s production of iron, steel, and commodity billets reached 7.23 million tons, 7.87 million tons, and 8.34 million tons respectively, with year-on-year growth rates of 7.20%, 10.65%, and 16.57% [72]. Research and Development - Research and development expenses increased due to the addition of new projects [40]. - Research and development expenses increased by 109.81% to 24.764 million RMB, indicating a focus on innovation [63]. Environmental and Sustainability Initiatives - The company implemented eight energy-saving and carbon reduction projects, achieving an annual coal savings of 51,700 tons and a cumulative cost reduction of 176 million RMB in 2022 [56]. - The company implemented carbon reduction measures, achieving a reduction of 115,600 tons of CO2 equivalent emissions [99]. - The company completed several environmental projects, including a zero discharge wastewater treatment system and a high-efficiency power generation technology [98]. - The company received the "Chongqing Green Factory" title in 2022, with an annual green development index of 74 points, an increase of 8 points year-on-year [56]. - The company is increasing its investment in Baowu Water Technology Co., leveraging its expertise for zero wastewater discharge and ultra-low emissions, supporting the company's green transformation [180]. Corporate Governance and Management - The company has complied with the corporate governance code as per the Hong Kong Stock Exchange listing rules during the reporting period [1]. - The company has maintained a continuous relationship with its accounting firm for five years, ensuring consistent auditing practices [109]. - The company’s audit committee consists of three independent non-executive directors and one non-executive director, ensuring oversight of financial reporting [5]. - The company appointed Meng Wenwang as the new President and Director in November 2022 [169]. - The company’s management team underwent significant changes in 2022, including the appointment and resignation of several key personnel [169][171]. Related Party Transactions - The total amount of products provided by the company to China Baowu Group from April 1, 2021, to December 31, 2023, is capped at RMB 49,741 million [132]. - The total amount of products, materials, and services provided by China Baowu Group to the company during the same period is capped at RMB 87,990 million [132]. - The actual amount of related transactions during the reporting period remained within the annual cap [132].