藏格矿业(000408) - 2019 Q3 - 季度财报

Part I Important Notice Important Notice The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the quarterly report, assuming legal responsibility; the company's head, chief accountant, and head of accounting department declare the financial statements are true, accurate, and complete - The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the quarterly report, free from false records, misleading statements, or major omissions, and assume individual and joint legal responsibility[2] - Company head Cao Bangjun, chief accountant Li Kai, and head of accounting department Liu Wei declare that the financial statements in the quarterly report are true, accurate, and complete[2] Part II Company Profile I. Major Accounting Data and Financial Indicators The company's total assets and net assets attributable to shareholders increased, but operating revenue, net profit, and non-recurring net profit significantly decreased year-over-year, along with basic EPS and ROE Major Accounting Data and Financial Indicators for Q3 2019 | Indicator | Current Period End (RMB) | Prior Year End Adjusted (RMB) | Change (Adjusted) | Current Period (RMB) | YoY Change for Current Period | Year-to-Date (RMB) | YoY Change for Year-to-Date | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Assets | 9,811,676,437.84 | 9,385,461,410.01 | 4.54% | -- | -- | -- | -- | | Net Assets Attributable to Shareholders | 7,801,712,173.56 | 7,435,201,825.75 | 4.93% | -- | -- | -- | -- | | Operating Revenue | -- | -- | -- | 353,562,568.83 | -49.23% | 1,160,288,525.20 | -36.76% | | Net Profit Attributable to Shareholders | -- | -- | -- | 115,093,881.53 | -64.16% | 352,127,119.20 | -53.26% | | Net Profit Attributable to Shareholders (Excluding Non-Recurring Gains/Losses) | -- | -- | -- | 122,227,387.78 | -61.04% | 311,548,181.64 | -57.20% | | Net Cash Flow from Operating Activities | -- | -- | -- | -- | -- | 176,983,113.03 | -21.85% | | Basic Earnings Per Share (RMB/share) | -- | -- | -- | 0.0577 | -64.18% | 0.1869 | -50.53% | | Diluted Earnings Per Share (RMB/share) | -- | -- | -- | 0.0577 | -64.18% | 0.1869 | -50.53% | | Weighted Average Return on Net Assets | -- | -- | -- | 1.51% | -67.44% | 4.62% | -57.40% | Reasons for Changes in Accounting Policies and Correction of Accounting Errors The company retrospectively adjusted its 2018 financial statements due to controlling shareholder fund occupation and non-compliant trade revenue recognition, impacting accounts receivable, other current assets, deferred revenue, operating income, capital reserves, and retained earnings - During the preparation of the 2018 annual report, the company discovered instances of fund occupation by the controlling shareholder and its related parties, leading Ruihua Certified Public Accountants to issue a qualified audit opinion on the 2018 financial report[4] - As of December 31, 2018, 404.36 million RMB in accounts receivable, 790.97 million RMB in other current assets, and -106.24 million RMB in deferred revenue were funds occupied by the controlling shareholder, retrospectively adjusted to other receivables with corresponding bad debt provisions[4] - Portions of trade revenue from subsidiaries Shanghai Zangxiang Trading Co., Ltd. and Shanghai Yaobo Trading Co., Ltd. did not comply with revenue recognition principles, impacting 2017 and 2018 operating revenue by -131.66 million RMB and -468.49 million RMB, respectively[5] - The asset management plan purchased by the company for 1.80 billion RMB involved transactions lacking commercial substance, with 1.20 billion RMB of reduced accounts receivable and prepayments partially occupied by related parties[6] Non-Recurring Gains and Losses Items and Amounts During the reporting period, the company's total non-recurring gains and losses amounted to 40.58 million RMB, primarily from government subsidies and fund occupation fees collected from non-financial enterprises Non-Recurring Gains and Losses Items from Year-Beginning to End of Reporting Period | Item | Year-to-Date Amount (RMB) | Notes | | :--- | :--- | :--- | | Government subsidies recognized in current profit or loss (excluding those closely related to the company's business and enjoyed at fixed or quantitative standards set by the state) | 2,854,612.19 | | | Fund occupation fees collected from non-financial enterprises recognized in current profit or loss | 45,595,661.05 | | | Other non-operating income and expenses apart from the above | -710,346.70 | | | Less: Income tax impact | 7,160,988.98 | | | Minority interest impact (after tax) | 0.00 | | | Total | 40,578,937.56 | -- | II. Total Number of Shareholders and Top Ten Shareholders' Holdings at the End of the Reporting Period As of the end of the reporting period, the company had 27,033 common shareholders; the top ten included Tibet Zangge Venture Capital Group, Sichuan Yonghong Industrial, and Xiao Yongming as concerted parties, with most of their shares pledged - The total number of common shareholders at the end of the reporting period was 27,033[8] - Tibet Zangge Venture Capital Group Co., Ltd., Sichuan Yonghong Industrial Co., Ltd., and Xiao Yongming are concerted parties[9] - Controlling shareholder Tibet Zangge Venture Capital Group Co., Ltd. holds 43.08% of shares, with all its holdings pledged[8] Top 10 Shareholders' Holdings | Shareholder Name | Shareholder Nature | Shareholding Percentage | Number of Shares Held (shares) | Number of Restricted Shares Held (shares) | Share Status | Number of Pledged or Frozen Shares (shares) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Tibet Zangge Venture Capital Group Co., Ltd. | Domestic Non-State-Owned Legal Person | 43.08% | 858,892,678 | 858,892,678 | Pledged | 858,892,678 | | Sichuan Yonghong Industrial Co., Ltd. | Domestic Non-State-Owned Legal Person | 19.42% | 387,228,181 | 387,228,181 | Pledged | 387,228,181 | | Xiao Yongming | Domestic Natural Person | 10.87% | 216,803,365 | 216,803,365 | Pledged | 216,801,382 | | Beijing Lianda Times Investment Co., Ltd. | Domestic Non-State-Owned Legal Person | 2.76% | 55,031,595 | 55,023,743 | Pledged | 55,031,595 | | National Social Security Fund 604 Portfolio | Other | 1.74% | 34,600,027 | 0 | | | | Li Ming | Domestic Natural Person | 1.71% | 33,996,752 | 0 | Pledged | 33,996,752 | | Yang Ping | Domestic Natural Person | 0.90% | 17,848,295 | 0 | Pledged | 17,848,295 | | Guotong Trust Co., Ltd. | State-Owned Legal Person | 0.82% | 16,307,899 | 0 | | | | Ningbo Xingtong Investment Management Co., Ltd. | Domestic Non-State-Owned Legal Person | 0.79% | 15,780,000 | 0 | | | | Beijing Lianda Sifang Investment Consulting Center (Limited Partnership) | Domestic Non-State-Owned Legal Person | 0.45% | 9,004,464 | 9,004,464 | Pledged | 9,000,000 | 1. Total Number of Common Shareholders and Preferred Shareholders with Restored Voting Rights, and Top 10 Shareholders' Holdings At the end of the reporting period, common shareholders totaled 27,033; the top ten included the controlling shareholder and concerted parties with high ownership, and most of their shares were pledged - The total number of common shareholders at the end of the reporting period was 27,033[8] - Tibet Zangge Venture Capital Group Co., Ltd., Sichuan Yonghong Industrial Co., Ltd., and Xiao Yongming are concerted parties, with most of their shareholdings pledged[8][9] 2. Total Number of Preferred Shareholders and Top 10 Preferred Shareholders' Holdings The company had no preferred shareholders during the reporting period - The company had no preferred shareholders during the reporting period[11] Part III Significant Events I. Changes and Reasons for Major Financial Data and Indicators During the Reporting Period Key financial data showed decreases in assets and profits, mainly due to payments, loan repayments, reduced potash sales, and investment losses Changes and Reasons for Major Financial Data During the Reporting Period | Item | Change Rate | Main Reasons | | :--- | :--- | :--- | | Balance Sheet Items | | | | Cash and Cash Equivalents | -34.10% | Primarily due to payments for materials and repayment of bank loans during the reporting period | | Notes Receivable | -87.16% | Primarily due to payments for materials and other supplier invoices during the reporting period | | Other Receivables | -91.42% | Due to the controlling shareholder's repayment of occupied funds during the reporting period | | Inventories | 33.04% | Primarily due to an increase in goods dispatched and work-in-progress during the current period | | Other Current Assets | -77.77% | Mainly due to the offset of asset management plans by fund occupation amounts recognized from January to June 2019 | | Short-term Borrowings | -19.81% | Primarily due to repayment of bank loans during the reporting period | | Deferred Revenue | 154.22% | Primarily due to an increase in customer prepayments during the reporting period | | Employee Benefits Payable | 49.39% | Primarily due to an increase in unpaid employee benefits during the current period | | Non-current Liabilities Due Within One Year | -100.00% | Primarily due to repayment of long-term bank loans during the reporting period | | Income Statement Items (Year-to-Date) | | | | Operating Revenue | -36.76% | Primarily due to decreased potash sales and reduced subsidiary trade business, leading to lower revenue compared to the same period last year | | Taxes and Surcharges | -31.06% | Primarily due to decreased potash sales, leading to reduced resource tax | | Selling Expenses | -24.63% | Primarily due to decreased potash sales, leading to reduced railway freight costs | | Other Income | -97.43% | Primarily due to reduced government subsidies obtained from trade business | | Investment Income | -66.69% | Investment loss recognized from Julong Copper during the current period | | Non-operating Income | 78.99% | Primarily due to an increase in government subsidies obtained during the current period | | Non-operating Expenses | -94.48% | Primarily due to fewer fixed asset disposals compared to the previous period | | Income Tax Expense | -61.58% | Primarily due to decreased potash sales, reduced subsidiary trade business, and lower revenue compared to the previous period, leading to reduced income tax expense | | Cash Flow Statement Items (Year-to-Date) | | | | Cash Received from Sales of Goods and Services | -56.30% | Primarily due to reduced cash from Zangge subsidiary's trade business during the reporting period | | Cash Received from Other Operating Activities | -43.12% | Primarily due to reduced government subsidies received from Zangge subsidiary's trade business during the current period | | Cash Paid for Goods and Services | -61.70% | Primarily due to reduced cash from Zangge subsidiary's trade business during the reporting period | | Cash Paid for Other Operating Activities | -32.16% | Primarily due to decreased potash sales, leading to reduced railway freight payments | | Taxes and Levies Paid | -77.71% | Primarily due to reduced taxes from Zangge subsidiary's trade business during the reporting period | | Cash Paid for Acquisition of Fixed Assets, Intangible Assets, and Other Long-term Assets | -90.36% | Primarily due to the commissioning of the lithium carbonate project, leading to reduced fixed asset investment during the reporting period | II. Progress, Impact, and Solutions for Significant Events The company made progress in new energy, with the lithium carbonate project successfully commissioned; controlling shareholder fund occupation was fully repaid through self-inspection, accounting corrections, and asset-for-debt swaps; the company also completed the re-election of directors and senior management - Subsidiary Zangge Potash established Golmud Zangge Lithium Industry Co., Ltd. in Golmud, strategically entering the new energy sector; the lithium carbonate project has successfully produced qualified battery-grade lithium carbonate products, expected to enhance future company profits[14] - The controlling shareholder's fund occupation issue has been fully repaid, including occupied funds, fees, and trade-related losses, through self-inspection, accounting error corrections, and asset-for-debt swaps, with the transfer of these asset equities completed[15] - The company completed its re-election of directors and senior management during the reporting period, replacing some personnel as required for development[15] Progress of Share Repurchase Implementation The company did not conduct any share repurchases during the reporting period - The company did not engage in agreed repurchase transactions or share repurchases during the reporting period[10][15] III. Unfulfilled Commitments by Actual Controllers, Shareholders, Related Parties, Acquirers, and the Company During the Reporting Period Performance commitments and compensation arrangements from asset restructuring remain unfulfilled due to the primary compensation obligor's pledged shares, with the company actively urging them to raise funds for resolution - Performance commitments and compensation arrangements made during asset restructuring remain unfulfilled beyond their due date[16] - Zangge Potash committed to achieving projected net profits (excluding non-operating gains/losses) of 1.14 billion RMB, 1.50 billion RMB, and 1.63 billion RMB for 2016, 2017, and 2018, respectively[16] - The majority of Zangge Holdings shares held by the primary compensation obligor are currently pledged, which is the main reason for the unfulfilled commitment[15] - The company will continue to urge the compensation obligor to promptly unpledge their Zangge Holdings shares to fulfill the performance compensation for the restructuring project as committed[15] IV. Securities Investment The company had no securities investments during the reporting period - The company had no securities investments during the reporting period[17] V. Wealth Management The company had no entrusted wealth management during the reporting period - The company had no entrusted wealth management during the reporting period[17] VI. Derivative Investments The company had no derivative investments during the reporting period - The company had no derivative investments during the reporting period[18] VII. Registration Form for Investor Relations Activities During the Reporting Period During the reporting period, the company primarily engaged with individual investors via phone, addressing inquiries on controlling shareholder fund occupation, lithium carbonate project progress, company operations, and share pledge releases - During the reporting period, the company primarily engaged with individual investors via phone communication[19][20] - Inquiries mainly covered the controlling shareholder's fund occupation, lithium carbonate project status, company operations, share repurchase and cancellation, share release, actual controller's share pledges, and Julong Company project progress[19][20] VIII. Irregular External Guarantees The company had no irregular external guarantees during the reporting period - The company had no irregular external guarantees during the reporting period[21] IX. Non-Operating Fund Occupation by Controlling Shareholder and Related Parties There was no non-operating fund occupation by the controlling shareholder or its related parties during the reporting period - There was no non-operating fund occupation by the controlling shareholder or its related parties during the reporting period[21] Part IV Financial Statements I. Financial Statements This section presents the company's consolidated and parent company balance sheets, income statements, and cash flow statements, comprehensively detailing financial position, operating results, and cash flows at the end of the reporting period 1. Consolidated Balance Sheet As of September 30, 2019, consolidated total assets were 9.81 billion RMB, a 4.54% increase from year-end, with total current assets at 2.27 billion RMB, non-current assets at 7.54 billion RMB, total liabilities at 2.01 billion RMB, and total owner's equity at 7.80 billion RMB Consolidated Balance Sheet Key Data (September 30, 2019 vs December 31, 2018) | Item | September 30, 2019 (RMB) | December 31, 2018 (RMB) | | :--- | :--- | :--- | | Total Assets | 9,811,676,437.84 | 9,385,461,410.01 | | Total Current Assets | 2,272,572,457.16 | 4,279,290,986.62 | | Total Non-current Assets | 7,539,103,980.68 | 5,106,170,423.39 | | Total Liabilities | 2,009,964,264.28 | 1,950,259,584.26 | | Total Owner's Equity | 7,801,712,173.56 | 7,435,201,825.75 | - Cash and cash equivalents decreased from 60.34 million RMB on December 31, 2018, to 39.77 million RMB on September 30, 2019[23] - Other receivables significantly decreased from 2.33 billion RMB on December 31, 2018, to 200.24 million RMB on September 30, 2019[23] - Long-term equity investments increased from 0 RMB on December 31, 2018, to 2.58 billion RMB on September 30, 2019[24] 2. Parent Company Balance Sheet As of September 30, 2019, parent company total assets significantly grew to 14.82 billion RMB from 10.66 billion RMB at year-end 2018, driven by increases in long-term equity investments and other receivables, while total liabilities rose to 613.24 million RMB mainly due to other payables Parent Company Balance Sheet Key Data (September 30, 2019 vs December 31, 2018) | Item | September 30, 2019 (RMB) | December 31, 2018 (RMB) | | :--- | :--- | :--- | | Total Assets | 14,824,338,078.50 | 10,656,210,803.27 | | Total Current Assets | 4,013,373,946.15 | 2,427,920,167.79 | | Total Non-current Assets | 10,810,964,132.35 | 8,228,290,635.48 | | Total Liabilities | 613,243,479.52 | 21,325,771.31 | | Total Owner's Equity | 14,211,094,598.98 | 10,634,885,031.96 | - Parent company other receivables increased from 2.40 billion RMB on December 31, 2018, to 3.99 billion RMB on September 30, 2019, with dividends receivable rising from 392.21 million RMB to 3.99 billion RMB[27] - Parent company long-term equity investments increased from 8.23 billion RMB on December 31, 2018, to 10.81 billion RMB on September 30, 2019[28] - Parent company other payables increased from 17.65 million RMB on December 31, 2018, to 610.85 million RMB on September 30, 2019[29] 3. Consolidated Income Statement for the Current Reporting Period For the third quarter, consolidated total operating revenue was 354 million RMB, a 49.23% year-over-year decrease; net profit attributable to parent company owners was 115 million RMB, down 64.16%, with basic EPS at 0.0577 RMB, a 64.18% decline Consolidated Income Statement Key Data for the Current Reporting Period (Current Period vs Prior Period) | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Total Operating Revenue | 353,562,568.83 | 696,401,384.09 | -49.23% | | Total Operating Costs | 231,151,183.48 | 308,532,585.03 | -25.08% | | Operating Profit | 137,676,525.25 | 390,640,752.40 | -64.75% | | Total Profit | 136,983,238.53 | 388,656,405.50 | -64.75% | | Net Profit | 115,093,881.53 | 321,113,408.66 | -64.16% | | Net Profit Attributable to Parent Company Owners | 115,093,881.53 | 321,113,408.66 | -64.16% | | Basic Earnings Per Share (RMB/share) | 0.0577 | 0.1611 | -64.18% | | Diluted Earnings Per Share (RMB/share) | 0.0577 | 0.1611 | -64.18% | - Financial expenses changed from -32,221.61 RMB in the prior period to 10.18 million RMB in the current period[31] - Credit impairment losses for the current period were 22.13 million RMB, with no such item in the prior period[32] 4. Parent Company Income Statement for the Current Reporting Period For the third quarter, the parent company reported zero operating revenue but achieved a net profit of 3.59 billion RMB, primarily driven by substantial investment income, contrasting with a 3.68 million RMB net loss in the prior period Parent Company Income Statement Key Data for the Current Reporting Period (Current Period vs Prior Period) | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | | :--- | :--- | :--- | | Operating Revenue | 0.00 | 0.00 | | Administrative Expenses | 5,320,436.23 | 3,738,785.86 | | Financial Expenses | -1,808.83 | -7,968.24 | | Investment Income | 3,592,726,761.77 | 0.00 | | Operating Profit | 3,587,405,564.29 | -3,730,904.04 | | Total Profit | 3,587,405,531.71 | -3,678,275.26 | | Net Profit | 3,587,405,531.71 | -3,678,275.26 | - Parent company investment income for the current period reached 3.59 billion RMB, serving as the primary source of profit[34] 5. Consolidated Income Statement from Year-Beginning to End of Reporting Period From year-beginning to the end of the reporting period, consolidated total operating revenue was 1.16 billion RMB, a 36.76% year-over-year decrease; net profit attributable to parent company owners was 352 million RMB, down 53.26%, with basic EPS at 0.1869 RMB, a 50.53% decline Consolidated Income Statement Key Data from Year-Beginning to End of Reporting Period (Current Period vs Prior Period) | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Total Operating Revenue | 1,160,288,525.20 | 1,834,624,531.25 | -36.76% | | Total Operating Costs | 763,745,418.21 | 917,521,428.64 | -16.76% | | Operating Profit | 418,309,258.06 | 945,656,015.47 | -55.77% | | Total Profit | 419,798,311.36 | 929,480,858.18 | -54.84% | | Net Profit | 352,127,119.20 | 753,340,570.33 | -53.26% | | Net Profit Attributable to Parent Company Owners | 352,127,119.20 | 753,340,570.33 | -53.26% | | Basic Earnings Per Share (RMB/share) | 0.1869 | 0.3778 | -50.53% | | Diluted Earnings Per Share (RMB/share) | 0.1869 | 0.3778 | -50.53% | - Credit impairment losses for the current period were 17.31 million RMB, compared to -8.41 million RMB in the prior period[37] - Net amount of other comprehensive income after tax for the current period was 20.54 million RMB, compared to 0 RMB in the prior period[37] 6. Parent Company Income Statement from Year-Beginning to End of Reporting Period From year-beginning to the end of the reporting period, the parent company reported zero operating revenue but achieved a net profit of 3.58 billion RMB, primarily due to substantial investment income, contrasting with an 11.24 million RMB net loss in the prior period Parent Company Income Statement Key Data from Year-Beginning to End of Reporting Period (Current Period vs Prior Period) | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | | :--- | :--- | :--- | | Operating Revenue | 0.00 | 0.00 | | Administrative Expenses | 16,525,691.58 | 11,331,542.33 | | Financial Expenses | -13,092.09 | -39,635.90 | | Investment Income | 3,592,726,761.77 | 0.00 | | Operating Profit | 3,576,213,877.28 | -11,293,726.39 | | Total Profit | 3,576,214,617.28 | -11,241,077.61 | | Net Profit | 3,576,214,617.28 | -11,241,077.61 | - Parent company investment income for the current period reached 3.59 billion RMB, serving as the primary source of profit[40] 7. Consolidated Cash Flow Statement from Year-Beginning to End of Reporting Period From year-beginning to the end of the reporting period, net cash flow from operating activities was 177 million RMB, down 21.85%; net cash flow from investing activities improved to -52.98 million RMB; net cash flow from financing activities increased outflow to -145 million RMB; and net increase in cash and cash equivalents was -20.58 million RMB Consolidated Cash Flow Statement Key Data from Year-Beginning to End of Reporting Period (Current Period vs Prior Period) | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | Change Rate | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 176,983,113.03 | 226,473,945.50 | -21.85% | | Net Cash Flow from Investing Activities | -52,980,867.23 | -254,166,619.38 | 79.15% (outflow decreased) | | Net Cash Flow from Financing Activities | -144,581,183.34 | -113,729,811.09 | -27.12% (outflow increased) | | Net Increase in Cash and Cash Equivalents | -20,578,937.54 | -141,422,484.97 | 85.46% (outflow decreased) | - Cash received from sales of goods and services decreased by 56.30% year-over-year, primarily due to reduced cash from Zangge subsidiary's trade business[43] - Cash paid for the acquisition of fixed assets, intangible assets, and other long-term assets decreased by 90.36% year-over-year, primarily due to the commissioning of the lithium carbonate project, leading to reduced fixed asset investment[44] 8. Parent Company Cash Flow Statement from Year-Beginning to End of Reporting Period From year-beginning to the end of the reporting period, parent company net cash outflow from operating activities decreased to -5.81 million RMB; net cash flow from investing activities shifted to an outflow of -0.50 million RMB from a prior inflow; net cash flow from financing activities was 0 RMB; and net increase in cash and cash equivalents was -6.31 million RMB Parent Company Cash Flow Statement Key Data from Year-Beginning to End of Reporting Period (Current Period vs Prior Period) | Item | Current Period Amount (RMB) | Prior Period Amount (RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | -5,810,166.42 | -12,194,936.85 | | Net Cash Flow from Investing Activities | -496,000.00 | 33,294,001.00 | | Net Cash Flow from Financing Activities | 0.00 | -12,015,243.37 | | Net Increase in Cash and Cash Equivalents | -6,306,166.42 | 9,083,820.78 | - Net cash flow from investing activities shifted from a positive value in the prior period to a negative value in the current period, primarily due to increased cash paid for the acquisition of fixed assets, intangible assets, and other long-term assets[44][45] II. Explanation of Financial Statement Adjustments Starting in 2019, the company adopted new financial instrument, revenue, or lease standards, but did not retrospectively adjust prior comparative data - The company adopted new financial instrument, revenue, or lease standards starting in 2019[47] - Prior comparative data were not retrospectively adjusted[47] III. Audit Report The company's third-quarter report was unaudited - The company's third-quarter report was unaudited[48]