兴业银锡(000426) - 2019 Q2 - 季度财报

Section I Important Notes, Table of Contents, and Definitions This section provides essential disclaimers, outlines the report's structure, and defines key terms and the reporting period Important Notes The company's management assures the report's accuracy, highlights key business risks, and confirms no profit distribution for the period - The company's Board of Directors, Supervisory Board, and senior management ensure the truthfulness, accuracy, and completeness of the report and assume corresponding legal responsibilities[4] - The company advises investors to be aware of potential risks in its main business, including price fluctuations, industry cyclicality, and production safety[4] - The company plans no cash dividends, bonus shares, or capital increase from capital reserves for the 2019 semi-annual period[4] Table of Contents This report is structured into eleven chapters, covering company overview, financial indicators, business summary, operational discussion, significant events, shareholder information, and financial reports - The report features a clear, eleven-section structure, comprehensively covering information from the company's basic situation to financial details[5] Definitions This chapter defines key abbreviations used in the report, including regulatory bodies, the company itself, its major holding shareholders, and subsidiaries, clarifying the reporting period from January 1 to June 30, 2019 - "Company/This Company" refers to Inner Mongolia Xingye Mining Co., Ltd., with key subsidiaries like Xingye Group and Yinman Mining also defined by their abbreviations[7] - The reporting period is defined as January 1, 2019, to June 30, 2019[7] Section II Company Profile and Key Financial Indicators This section presents the company's fundamental information and a summary of its financial performance during the reporting period Company Profile This chapter provides the company's basic information, including its stock ticker "Xingye Mining," stock code "000426," full name, legal representative, and contact details for the Board Secretary and Securities Affairs Representative, noting no changes in contact information or disclosure locations during the reporting period - The company's stock ticker is "Xingye Mining," stock code is 000426, listed on the Shenzhen Stock Exchange[8] - The company's legal representative is Ji Xingye[8] Key Accounting Data and Financial Indicators During the reporting period, the company's financial performance significantly declined, with revenue decreasing by 70.15% year-over-year and net profit attributable to shareholders turning from profit to loss, down 121.23%, primarily due to subsidiary production halts | Indicator | Current Period | Prior Year Period | Year-over-Year Change | | :--- | :--- | :--- | :--- | | Operating Revenue (RMB) | 337,755,185.38 | 1,131,633,023.26 | -70.15% | | Net Profit Attributable to Shareholders (RMB) | -78,041,673.15 | 367,611,001.51 | -121.23% | | Net Cash Flow from Operating Activities (RMB) | 181,605,334.22 | 362,429,499.74 | -49.89% | | Basic Earnings Per Share (RMB/share) | -0.0425 | 0.1966 | -121.62% | | Weighted Average Return on Net Assets | -1.50% | 6.56% | -8.06% | | Total Assets (RMB) | 9,009,623,473.59 | 8,933,497,776.05 | 0.85% | | Item | Amount (RMB) | | :--- | :--- | | Non-current asset disposal gains/losses | 798,928.60 | | Government grants recognized in current profit/loss | 159,405.43 | | Other non-operating income/expenses | -21,078,139.44 | | Total | -20,256,761.08 | Section III Company Business Overview This section details the company's primary business activities, significant asset changes, and core competitive advantages Primary Business Activities The company's main business involves the mining, dressing, and smelting of non-ferrous and precious metals, operating through four segments: mining, smelting, investment, and trading, with non-ferrous metal mining being the primary revenue driver - The company's main business is non-ferrous and precious metal mining and smelting, divided into four segments: mining, smelting, investment, and trading[18] - Key products include concentrates of lead, zinc, silver, tin, copper, and iron, along with associated metals like bismuth and tungsten[19] - Non-ferrous metal mining and dressing business is the company's core revenue source, accounting for 99.52% of total operating revenue in the first half of 2019[28] Significant Changes in Major Assets During the reporting period, there were no significant changes in the company's major asset categories, including equity investments, fixed assets, intangible assets, and construction in progress, nor did it hold significant overseas assets - During the reporting period, the company's major assets, including equity investments, fixed assets, intangible assets, and construction in progress, did not undergo significant changes[29] Core Competitiveness Analysis The company's core competitiveness stems from its advantageous location in Inner Mongolia, substantial high-grade multi-metal mineral resources, commitment from its controlling shareholder to inject quality assets, and an experienced management and technical team with leading process equipment - The company's location in resource-rich Inner Mongolia provides a unique geographical advantage, facilitating resource integration and expansion[31] - It possesses large-scale, high-grade multi-metal resource reserves, with its subsidiary Yinman Mining being the largest silver production mine in China[32] - The controlling shareholder, Xingye Group, has committed to transferring relevant assets to the listed company once exploration rights are converted to mining rights, ensuring continuous resource supply[33] - The company boasts an experienced management and technical team, utilizing industry-leading equipment and automated control technologies[34] Section IV Discussion and Analysis of Operations This section provides an overview of the company's operational performance, detailed analysis of its main business, asset and liability status, and key risks with corresponding countermeasures Overview In the first half of 2019, the company's operating performance significantly declined due to the "2·23" major transportation safety accident at its subsidiary Yinman Mining, leading to production halts and a substantial drop in revenue and net profit | Indicator | H1 2019 | Year-over-Year Change | | :--- | :--- | :--- | | Operating Revenue | 338 million RMB | -70.15% | | Total Profit | -89 million RMB | -117.99% | | Net Profit Attributable to Parent | -78 million RMB | -121.23% | - The primary reason for the performance decline was the production halt and rectification at subsidiary Yinman Mining since February 24, 2019, following the "2·23" major transportation safety accident[35] - Subsidiaries Rongguan Mining and Xilin Mining have fully resumed production after their halts; Qianjinda Mining awaits inspection approval to resume construction; Rongbang Mining is expected to commence formal production by year-end[35] Analysis of Main Business Due to the production halt at Yinman Mining, the company's main business indicators experienced significant declines, with operating revenue and cost decreasing by 70.15% and 59.92% respectively, while management expenses surged by 50.79% due to the inclusion of shutdown losses | Item | Current Period (RMB) | Year-over-Year Change | Primary Reason | | :--- | :--- | :--- | :--- | | Operating Revenue | 337,755,185.38 | -70.15% | Decreased production and sales due to Yinman Mining's shutdown | | Operating Cost | 158,135,878.43 | -59.92% | Decreased production and sales | | Management Expenses | 134,239,449.59 | 50.79% | Shutdown losses at Yinman Mining recognized in current period | | Net Cash Flow from Operating Activities | 181,605,334.22 | -49.89% | Decrease in cash received from sales of goods | | Product | Operating Revenue (RMB) | Revenue Year-over-Year Change | | :--- | :--- | :--- | | Zinc Concentrate | 182,327,393.46 | -69.86% | | Iron Concentrate | 56,174,247.10 | +56.93% | | Copper-bearing Silver Concentrate | 30,249,672.89 | -85.41% | | Tin Concentrate | 38,386,777.14 | -80.13% | - The mining industry, as the company's main business, had a gross profit margin of 53.43%, a decrease of 11.94 percentage points compared to the same period last year[39] Analysis of Assets and Liabilities At the end of the reporting period, the company's total assets slightly increased by 0.85% to 9.01 billion RMB, with significant changes in cash due to lower sales and debt repayments, and a reclassification of long-term borrowings to current liabilities | Major Asset/Liability | Period-end Amount (RMB) | % of Total Assets | Explanation for Change from Prior Year-end | | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 21,814,377.76 | 0.24% | Decreased due to lower production/sales and repayment of payables | | Long-term Equity Investments | 291,339,613.24 | 3.23% | Resulting from the acquisition of 49% equity in Tongdu Mining in 2018 | | Fixed Assets | 2,970,702,484.11 | 32.97% | Decreased due to significant impairment losses recognized at the end of 2018 | | Long-term Borrowings | 544,538,903.11 | 6.04% | Portion of borrowings reclassified to non-current liabilities due within one year | - The company's assets measured at fair value primarily consist of other equity instrument investments, with a period-end balance of 257 million RMB[43] Analysis of Major Holding and Participating Companies This chapter details the financial status of the company's 14 major subsidiaries, highlighting Rongguan Mining as the primary profit contributor with a net profit of 66.69 million RMB, while Xilin Mining, Tanghe Times Mining, and Yinman Mining reported losses, with Yinman Mining's loss of 22.84 million RMB attributed to its production halt | Subsidiary Name | Main Business | Operating Revenue (RMB) | Net Profit (RMB) | | :--- | :--- | :--- | :--- | | Inner Mongolia Xingye Group Rongguan Mining Co., Ltd. | Non-ferrous metal mining and dressing | 218.05 million | 66.69 million | | Xiwuzhumuqinqi Yinman Mining Co., Ltd. | Non-ferrous metal mining and dressing | 94.22 million | -22.84 million | | Inner Mongolia Xingye Group Xilin Mining Co., Ltd. | Non-ferrous metal mining and dressing | 2.13 million | -25.43 million | | Tanghe Times Mining Co., Ltd. | Non-ferrous metal mining and dressing | 0.51 million | -15.82 million | Risks and Countermeasures The company faces three primary risks: market price fluctuations, production safety, and environmental protection, which it plans to address through industrial structure adjustments, increased safety investments, and improved environmental management systems - Key risks include: market price fluctuations of non-ferrous metals, production safety hazards in mining operations, and environmental impact from mining and dressing activities[51][52][53] - Countermeasures involve: optimizing resource allocation and cost control, strengthening safety education and accountability, and establishing a comprehensive environmental management and supervision system to ensure compliance and ecological restoration[53] Section V Significant Events This section details the company's significant events, including the fulfillment of commitments, integrity status of the controlling shareholder, major related-party transactions, social responsibility initiatives, and other important matters Fulfillment of Commitments During the reporting period, controlling shareholder Xingye Group failed to fully meet its performance commitments for subsidiaries Tanghe Times and Rongbang Mining, with 86.52 million RMB in compensation outstanding for 2017 and 2018, despite repeated company催缴 - Controlling shareholder Xingye Group has an outstanding compensation payment of 86.52 million RMB due to Tanghe Times and Rongbang Mining failing to meet their performance commitments for 2017 and 2018[59][60] - The company has repeatedly sent letters to Xingye Group to urge payment but has not yet received a feasible fulfillment plan and will continue to communicate and supervise its obligations[60] Controlling Shareholder's Integrity Status The company's controlling shareholder, Xingye Group, has been petitioned for reorganization by its creditor, Chifeng Yubang Mining Co., Ltd., due to its inability to repay matured debts, which may impact the company's equity structure - Controlling shareholder Xingye Group has been petitioned for reorganization by its creditor to the Chifeng Intermediate People's Court due to its inability to repay matured debts[62] Major Related-Party Transactions During the reporting period, the company engaged in related-party debt and credit transactions, including 86.52 million RMB in performance compensation receivable from the controlling shareholder and 34.10 million RMB in funds lent to joint venture Tongdu Mining, alongside office building leases and inter-company guarantees | Related Party | Relationship | Item | Period-end Balance (RMB) | | :--- | :--- | :--- | :--- | | Inner Mongolia Xingye Group Co., Ltd. | Controlling Shareholder | Performance Compensation | 86,519,300.00 | | Kunming Dongchuan District Tongdu Mining Co., Ltd. | Joint Venture | Fund Lending | 34,098,000.00 | - The company leases office space from its controlling shareholder, Xingye Group, with an annual rent of 7.18 million RMB[71][72] - The company provided a 592 million RMB mortgage guarantee for its subsidiary Tanghe Times and a 1.1 billion RMB mortgage guarantee for Xingye Mining itself, with inter-subsidiary guarantees also in place[73] Social Responsibility The company prioritizes environmental protection, ensuring all subsidiaries comply with regulations for waste treatment and ecological restoration, with no subsidiaries listed as key polluting units, and also engages in targeted poverty alleviation efforts - All company subsidiaries are not listed as key polluting units and have implemented various measures to ensure pollutant discharge compliance and circular utilization[76] - Due to the production accident, subsidiary Yinman Mining's underground dewatering water is discharged into rivers after purification, with project approval obtained[76] - In terms of social poverty alleviation, subsidiary Rongguan Mining invested 0.05 million RMB in targeted poverty alleviation during the reporting period[80][81] Other Significant Matters During the reporting period, the company terminated its planned acquisition of Turpan Xueyin Metal Mining Co., Ltd. shares, did not proceed with a proposed 600 million RMB financial assistance to Fujian Zhonghe Co., Ltd. due to unfulfilled guarantees, and reiterated the controlling shareholder's reorganization application - On January 31, 2019, the company decided to terminate the acquisition of Turpan Xueyin Metal Mining Co., Ltd. equity through share issuance and cash payment, citing changes in capital market conditions and slower-than-expected transaction progress[82][83] - The proposed financial assistance of up to 600 million RMB to Fujian Zhonghe Co., Ltd. (ST Zhonghe) was not implemented due to unfulfilled guarantee measures[84] - The controlling shareholder, Xingye Group, has been petitioned for reorganization by its creditor, an event that remains uncertain but could impact the company's equity structure[85][86] Significant Subsidiary Matters The most significant subsidiary event during the reporting period was the major transportation safety accident at wholly-owned subsidiary Yinman Mining on February 23, 2019, which remains under investigation, with the subsidiary still in a state of production suspension - On February 23, 2019, wholly-owned subsidiary Yinman Mining experienced a major transportation safety accident[87] - As of the report disclosure date, Yinman Mining remains in a state of production and business suspension, with the accident investigation still ongoing and no final results yet issued[87] Section VI Share Changes and Shareholder Information This section details the company's share capital stability, share repurchase status, and the composition and holdings of its shareholders, including significant pledges and freezes Share Changes During the reporting period, the company's total share capital remained unchanged at 1.87 billion shares, with no share repurchases occurring in the period, though 31.31 million shares previously repurchased were cancelled post-period - During the reporting period, the company's total share capital and share structure remained unchanged, with a total of 1,868,500,557 shares[89] - As of June 30, 2019, the company had completed its share repurchase plan, accumulating 31.31 million shares at a total cost of approximately 200 million RMB, which were subsequently cancelled on August 12, 2019[89][90] Shareholder Numbers and Shareholdings As of the end of the reporting period, the company had 49,499 common shareholders, with the controlling shareholder, Inner Mongolia Xingye Group Co., Ltd., holding 29.76% of shares, almost entirely pledged and judicially frozen, and the second-largest shareholder, Gansu Northwest Mining Group Co., Ltd., holding 7.80%, also fully pledged and frozen - At the end of the reporting period, the company had 49,499 common shareholders[92] | Shareholder Name | Shareholding Percentage | Shareholding Status | | :--- | :--- | :--- | | Inner Mongolia Xingye Group Co., Ltd. | 29.76% | Almost entirely pledged, entirely frozen | | Gansu Northwest Mining Group Co., Ltd. | 7.80% | Entirely pledged, entirely frozen | | Chifeng Fulong Public (Group) Co., Ltd. | 7.40% | Partially pledged | | Li Xianlai | 5.90% | Almost entirely pledged | - Shareholders Ji Xiang and Ji Wei have father-son/daughter relationships with the company's actual controller, Ji Xingye; shareholder Li Xianlai and Li Pei have a father-daughter relationship[93] Section X Financial Report This section presents the company's unaudited consolidated and parent company financial statements for the first half of 2019, along with detailed notes on key financial items and related-party transactions Financial Statements This chapter provides the unaudited consolidated and parent company financial statements for the first half of 2019, showing a significant decline in consolidated operating revenue to 337.76 million RMB and a net loss of 78.04 million RMB, alongside total assets of 9.01 billion RMB and net cash flow from operating activities of 181.61 million RMB Consolidated Balance Sheet Summary (2019-06-30) | Item | Amount (RMB) | | :--- | :--- | | Total Assets | 9,009,623,473.59 | | Total Liabilities | 3,841,588,824.71 | | Equity Attributable to Parent Company Owners | 5,177,099,587.22 | Consolidated Income Statement Summary (H1 2019) | Item | Amount (RMB) | | :--- | :--- | | Total Operating Revenue | 337,755,185.38 | | Total Operating Costs | 405,219,992.37 | | Total Profit | -88,577,723.74 | | Net Profit | -78,042,206.70 | | Net Profit Attributable to Parent Company Owners | -78,041,673.15 | Consolidated Cash Flow Statement Summary (H1 2019) | Item | Amount (RMB) | | :--- | :--- | | Net Cash Flow from Operating Activities | 181,605,334.22 | | Net Cash Flow from Investing Activities | -134,344,829.04 | | Net Cash Flow from Financing Activities | -70,138,269.21 | | Net Increase in Cash and Cash Equivalents | -22,877,764.03 | Notes to Consolidated Financial Statements This chapter provides detailed explanations of key items in the consolidated financial statements, including cash and cash equivalents, accounts receivable, inventories, fixed assets, construction in progress, short-term borrowings, and provisions for the "2·23" safety accident - Cash and cash equivalents at period-end amounted to 21.81 million RMB, of which 7.14 million RMB was restricted due to litigation freezes and environmental governance deposits[184] - Accounts receivable at period-end totaled 91.86 million RMB, with a bad debt provision of 5.48 million RMB based on aging analysis[189] - Fixed assets had a book value of 2.97 billion RMB, including 369 million RMB in buildings and structures for which property certificates have not yet been obtained[210][213][215] - Due to the Yinman Mining "2·23" major transportation safety accident, the company recognized a provision of 3 million RMB for estimated fines based on relevant regulations[237] - The total amount of assets whose ownership or use rights are restricted is 2.05 billion RMB, primarily mining rights, land use rights, and fixed assets pledged for bank borrowings[264] Related Parties and Related Party Transactions This chapter discloses related-party transactions, identifying Ji Xingye as the actual controller and Inner Mongolia Xingye Group Co., Ltd. as the controlling shareholder with a 29.76% stake, detailing significant transactions such as office leases, substantial loan guarantees by the controlling shareholder, inter-subsidiary guarantees, and funds lent to a joint venture, with 86.52 million RMB in performance compensation receivable from the controlling shareholder at period-end - The company's controlling shareholder is Inner Mongolia Xingye Group Co., Ltd., holding 29.76% of shares, and the actual controller is Ji Xingye[280] - Controlling shareholder Xingye Group and its chairman Ji Xingye provided loan guarantees totaling 2.24 billion RMB for the company and its subsidiaries[283][284] - The company lent 34.10 million RMB to its joint venture, Kunming Dongchuan District Tongdu Mining Co., Ltd., for its production startup[287] - Among receivables from related parties, the most significant is the performance compensation receivable from controlling shareholder Xingye Group, with a period-end balance of 86.52 million RMB[289] Other Significant Matters This chapter discloses other important information impacting investor decisions, including the breakdown of main business by product and region, the high proportion of pledged and judicially frozen shares held by the controlling shareholder and second-largest shareholder, and reiterates the significant safety accident at Yinman Mining and the controlling shareholder's reorganization application | Product Category | Operating Revenue (RMB) | Operating Cost (RMB) | | :--- | :--- | :--- | | Zinc Concentrate | 182,327,393.46 | 78,575,577.78 | | Iron Concentrate | 56,174,247.10 | 26,308,270.23 | | Tin Concentrate | 38,386,777.14 | 21,751,851.60 | | Copper-bearing Silver Concentrate | 30,249,672.89 | 16,690,355.51 | - Controlling shareholder Xingye Group's 30.27% stake in the company is entirely judicially frozen and 99.81% is pledged[299] - The second-largest shareholder, Northwest Mining, has its entire 7.94% stake in the company pledged and judicially frozen[300] - Reiteration of significant matters includes the major transportation safety accident at subsidiary Yinman Mining, the company's share repurchase and cancellation, and the controlling shareholder's application for reorganization[301][302][303]