ECEC(SZ:002140)2021-08-30 16:00Financial Performance - The company's operating revenue for the first half of 2021 was ¥2,205,546,642.68, representing an increase of 80.14% compared to ¥1,224,384,417.00 in the same period last year[25]. - The net profit attributable to shareholders of the listed company was ¥133,426,285.25, up 37.34% from ¥97,152,525.49 in the previous year[25]. - The net cash flow from operating activities reached ¥205,279,244.82, a significant increase of 208.30% compared to -¥189,543,697.80 in the same period last year[25]. - The basic earnings per share increased to ¥0.2493, reflecting a growth of 37.36% from ¥0.1815 in the previous year[25]. - Total assets at the end of the reporting period were ¥8,339,625,926.04, a 2.52% increase from ¥8,134,712,984.23 at the end of the previous year[25]. - The net assets attributable to shareholders of the listed company were ¥2,448,133,909.92, up 3.27% from ¥2,370,690,923.38 at the end of the previous year[25]. - The weighted average return on net assets was 5.50%, an increase from 4.29% in the previous year[25]. - Operating costs rose to CNY 1,978,868,761.93, a 100.07% increase compared to the previous year, with the growth rate of costs exceeding that of revenue due to high-margin design and technical income in the prior year[71]. - The company’s gross profit margin decreased to 9.71% in the chemical industry, down by 9.19% year-on-year, reflecting increased costs[78]. Business Operations - The company operates primarily in the civil engineering construction industry, focusing on chemical engineering, environmental governance, and infrastructure projects[34]. - The company’s engineering business includes comprehensive services such as consulting, design, construction, and general contracting, primarily using the EPC model[41]. - The company is expanding its industrial business, focusing on environmental facility operations and high-end chemical production[40]. - The company has invested in 11 environmental operation projects, with 8 projects completed and generating operational revenue[45]. - In the first half of 2021, the company signed engineering contracts totaling 2.854 billion yuan, with 2.665 billion yuan for general contracting and 189 million yuan for consulting and design[51]. - 40.82% of the signed contracts were in the chemical sector, while 59.18% were in non-chemical sectors such as environmental governance and infrastructure[51]. - The company is actively expanding into high-end chemical production, focusing on new materials like PBAT and DMC, with ongoing project construction[45]. - The company has established a comprehensive investment project management system to ensure effective control over project operations[45]. - The company is focusing on expanding its market presence in environmental governance, with significant projects in wastewater treatment and soil remediation[52]. Research and Development - The company has established a new research institute, the China Chemical Donghua Environmental Research Institute, to enhance its R&D capabilities and foster innovation in new technologies[61]. - The company has filed over 10 research projects in high-end chemicals and environmental governance, with several mid-test facilities under construction[64]. - The company has been awarded 20 patents in the first half of the year, including 12 invention patents, reflecting its commitment to innovation and intellectual property protection[65]. - The company’s research and development investment decreased by 31.14% to CNY 28,013,820.23, indicating a shift in focus or resource allocation[71]. Market and Economic Environment - The macroeconomic environment showed a 5.3% average growth in GDP for the first half of 2021, indicating a stable recovery[35]. - The petrochemical industry experienced significant price increases and production growth in the first half of 2021, although it faces pressure for slower growth in the second half[36]. - The environmental governance sector is expected to see substantial market opportunities, driven by national policies aimed at ecological civilization and pollution prevention[37]. Risk Management - The company has disclosed various operational risks, including technical and investment risks, in its report[5]. - The company faces risks related to macroeconomic conditions and industry policies, particularly in the chemical sector under the "dual carbon" context[113]. - The company plans to focus on effective measures to control risks associated with domestic business uncertainties and economic order challenges[113]. - The company is enhancing project management and communication with stakeholders to ensure smooth execution of engineering projects and mitigate risks related to funding and policy changes[119]. - The company emphasizes the importance of a complete investment management system to control risks associated with rapid investment expansion and ensure thorough evaluations of investment projects[120]. Legal Matters - The company is the plaintiff in a lawsuit against Inner Mongolia Kangle Chemical Industry Co., claiming a project progress payment of 505.55 million yuan, which has been upheld by the Supreme People's Court[157]. - The company has initiated arbitration against Bayannaoer Hengtai New Energy Co. for a contract payment of 43.14 million yuan, with the case currently unresolved[160]. - The company is pursuing a claim against Anhui Huaihua Group for 45 million yuan related to a share repurchase agreement, with a recent ruling confirming the company's claim[160]. - The company is involved in a lawsuit with the Tunisian National Social Security Fund regarding local worker social security payments, with no judgment yet[160]. - The company has multiple ongoing litigation and arbitration cases, indicating a significant amount of financial exposure across various projects and contracts[169]. Environmental Responsibility - The company has actively fulfilled its social responsibilities, donating a total of 48,000 yuan to a rural school in Gansu Province for teaching computers and books[147]. - The company has not faced any administrative penalties due to environmental issues during the reporting period[144]. - The company has developed emergency response plans for environmental incidents in accordance with national regulations[141]. - The company’s overall pollution control facilities have been operating normally, effectively reducing pollutant emissions and protecting the ecological environment[136]. - The company has established a "three-in-one" system (QHSE) to ensure quality, health, safety, and environmental protection, undertaking over 1,000 environmental engineering projects[145]. Investment and Financing - The company plans to issue up to 164 million A-shares at a price of 5.69 CNY per share, aiming to raise a total of 931 million CNY for projects including the East Wastewater Phase II project and the Wuhu "JADE" EPC project[56]. - The total investment amount for the reporting period was ¥72,363,291.40, a 140.54% increase from ¥30,083,464.51 in the same period last year[89]. - The company made a significant equity investment of ¥102,000,000.00 in a new subsidiary, holding a 51% stake[89]. - The company has received approval for its non-public issuance of A-shares, with strategic investors including the state-owned Shaanxi Coal and Chemical Group, which will strengthen its market position[57]. Related Party Transactions - The company engaged in related party transactions totaling 26.96 million yuan, accounting for 1.47% of similar transaction amounts[177]. - The total amount of related party transactions with China Chemical Engineering Group was 422.36 million CNY[183]. - The company provided a short-term loan of 10 million CNY to its subsidiary for working capital purposes[183]. - The company confirmed a right-of-use asset and recognized financing costs in accordance with new leasing standards[183].