Operations and Market Position - The Group's operations focus on the manufacture and sales of liquefied coalbed gas, primarily located in the Shanxi Qinshui Basin, which is known for its rich resources [21]. - Significant investments have been made in resource exploration and exploitation at coalbed methane blocks in Yangcheng, Shanxi, since July 2011, enhancing the Group's position in China's unconventional gas market [23]. - The Group aims to stabilize natural gas supply and increase utilization of its liquefied natural gas (LNG) plant through successful gas supply initiatives [23]. - The Group's distribution network extends to various provinces, including Shanxi, ensuring a broad market reach [22]. - The Group has transformed into a vertically integrated natural gas company through commercial production of coalbed gas, enhancing its market leadership [23]. - The Group has established a complete business process covering CBM extraction, liquefaction, transportation, and distribution, enhancing its position in the natural gas market [29]. - The Group's strategic focus on vertical integration has strengthened its market position in unconventional natural gas production [29]. Financial Performance - The Group recorded a consolidated turnover of approximately RMB239,421,000 for the year ended 31 December 2023, representing a decrease of approximately 26.67% compared to RMB325,680,000 in 2022 [57]. - Profit attributable to equity shareholders for the year ended 31 December 2023 was approximately RMB2,530,000, a significant decrease from RMB127,293,000 in 2022 [58]. - The decrease in profits was primarily due to the absence of a gain on disposal of a business in 2023, which was approximately RMB100,797,000 in 2022 [59]. - As of December 31, 2023, the Group had net assets of approximately RMB 160,801,000, including cash and bank balances of approximately RMB 45,444,000 [75]. - The Group's gearing ratio was approximately 11.78% as of December 31, 2023, compared to 6.59% in 2022 [75]. - The total cost of staff recognized in profit or loss for the year was approximately RMB 25,612,000, down from approximately RMB 31,848,000 in 2022 [82]. - The Group has no significant investments or material acquisitions of subsidiaries during the year ended December 31, 2023 [85]. Production and Technology Development - As of December 31, 2023, the Group has completed the groundwork and drilling of 229 Coalbed Methane (CBM) wells, with 164 wells currently in stable production [29]. - The average daily production of the Group's LNG plants was approximately 180,000 cubic meters, while the production capacity remained at around 500,000 cubic meters per day [35]. - The Group's focus on improving production well capabilities has positively impacted profitability and cash flow, with expectations for further improvement as production well numbers increase [30]. - The Group is committed to advancing CBM extraction technology and techniques, investing heavily in research and development to maintain its technological leadership [37]. - The Group commenced R&D on a new technology for natural gas production, named High-temperature-water Activate C-H to Synthesis of Natural-gas Technology, with small-scale production expected to start by the end of 2021 [50]. - The first pilot equipment for the new technology underwent trial runs in June 2021, and an improved design plan was proposed in November 2021 [51]. - The Group plans to conduct advanced demonstrations of the second pilot equipment overseas upon its completion, inviting internationally renowned experts for evaluation [93]. - The successful development of C-H to Synthesis of natural gas production will allow the Group to reduce exposure to external factors and risks [96]. Environmental and Social Responsibility - The Group emphasizes social responsibility while developing in the new energy sector, aiming to provide high-quality clean energy [24]. - The Group's commitment to environmental sustainability is highlighted in its operational strategies and future outlook [24]. - The Group has complied with all relevant laws and regulations, demonstrating its commitment to environmental and social responsibilities [43]. - There is a strong market demand for natural gas, driven by growing environmental concerns and the elimination of highly-polluted energy sources [97]. Governance and Board Structure - The Company has complied with all provisions in the Company Code and the Code Provisions during the year ended December 31, 2023, except for specific provisions [106]. - The Board held 18 meetings in 2023, with regular meetings typically occurring every three months [134]. - The Company has three independent non-executive Directors, representing at least one-third of the Board, in compliance with GEM Listing Rules [115]. - The independent non-executive Directors have confirmed their independence annually as per Rule 5.09 of the GEM Listing Rules [116]. - The Board is responsible for the overall leadership and supervision of the Company's business and affairs [122]. - The Company has adopted a code of conduct for securities trading by Directors, adhering to GEM Listing Rules [116]. - The roles of the chairman and chief executive are separated to maintain a balance of power and authority [128]. - The Board is accountable to shareholders and responsible for preparing the accounts [125]. - The Company has established policies for business activities, internal controls, and administration [132]. Diversity and Inclusion - The Company aims to maintain a balance of gender diversity in recruiting key management and personnel across its operations [171]. - The Board plans to appoint at least one director of a different gender by December 31, 2024, to enhance gender diversity [161]. - As of December 31, 2023, the Group has a workforce gender ratio of approximately 2:1 (male to female) [169]. - The Board has set measurable objectives to ensure a balance of male and female representation by December 31, 2024 [167]. - The Nomination Committee is satisfied with the existing composition of the Board and recommends no changes in the near future [175]. Audit and Compliance - The Audit Committee held four meetings in 2023 to review the Group's annual financial results and internal control systems [180]. - The Group's results for the year ended December 31, 2023, were reviewed and deemed compliant with applicable accounting standards and GEM Listing Rules [186]. - The Company aims to present a balanced and clear assessment of its performance, position, and prospects in all corporate communications [194]. - The Board has ensured that the financial statements for the year ending December 31, 2023, reflect the Group's performance and cash flow accurately [196]. - The external auditors, KTC Partners CPA Limited, received approximately RMB1,250,000 for audit services and RMB137,000 for non-audit services in 2023 [200]. - The Audit Committee concluded that the Group has established a sound internal control environment and complied with the code provisions on internal controls and risk management in 2023 [199]. - The Group has adopted suitable accounting policies and applied them consistently, ensuring accounts are prepared on a going concern basis [197].
中国煤层气(08270) - 2023 - 年度财报