Beijing Shougang Co. Ltd Annual Report 2023
Beijing Shougang Company Limited
2023 Annual Report
18 April 2024
1
Beijing Shougang Co. Ltd Annual Report 2023
Section I. Important notice, Content, Definitions
The board of directors (the “Board”), the supervisory committee, all directors, supervisors and senior executives
of the Company warrant that there are no false representations, misleading statements or material omissions in this
annual report; and are jointly and individually responsible for the truthfulness, accuracy and completeness of the
information contained in this annual report.
Chairman Qiu Yinfu, General Manager Sun Maolin, Chief Accountant Liu Tonghe, and Accounting Officer Gong
Juanjuan declare that they guarantee the authenticity, accuracy, and completeness of the financial reports in this
year's report.
All directors have attended the board meeting to review this report.
Certain risks that may exist have been elaborated by the Company in this report. Please refer to Discussion and
Analysis of Business Operations for details.
The profit distribution plan approved by the board of directors is as follows: based on 7,794,611,605, cash
dividends of RMB 0.3 (including tax) will be distributed to all shareholders for every 10 shares, and 0 bonus
shares (including tax) will be issued and there is no conversion of reserve into share capital.
2
Beijing Shougang Co. Ltd Annual Report 2023
CONTENTS
SECTION I. IMPORTANT NOTICE, CONTENT, DEFINITIONS......................................................................................................................................................2
SECTION II. COMPANY PROFILE AND MAJOR FINANCIAL INDICATORS ........................................................................................................................... 6
SECTION III. DISCUSSION AND ANALYSIS OF BUSINESS OPERATIONS .......................................................................................................................... 8
SECTION IV. CORPORATE GOVERNANCE.....................................................................................................................................................................................29
SECTION V. ENVIRONMENT AND SOCIAL RESPONSIBILITY ................................................................................................................................................46
SECTION VI. SIGNIFICANT EVENTS ............................................................................................................................................................................................... 52
SECTION VII. MOVEMENTS IN SHARE CAPITAL AND SHAREHOLDERS .......................................................................................................................... 59
SECTION VIII. PREFERRED SHARES ............................................................................................................................................................................................. 65
SECTION IX. BONDS ........................................................................................................................................................................................................................... 66
SECTION X. FINANCIAL REPORT ......................................................................................................................................................................................................72
3
Beijing Shougang Co. Ltd Annual Report 2023
File directory for reference
1. Accounting statements signed and stamped by the Chairman, General Manager, Chief Accountant, and Head of
Accounting Institution.
2. Original audit report with the seal of the accounting firm, signature and seal of the CPA.
3. Original copies of all company documents and announcements publicly disclosed in newspapers designated by
the China Securities Regulatory Commission during the reporting period.
4. The articles of association of the Company, etc.
4
Beijing Shougang Co. Ltd Annual Report 2023
INTERPRETATION
Items Refers to Contents
CSRC Refers to China Securities Regulatory Commission
SZSE Refers to Shenzhen Stock Exchange
Company, the Company/the
Refers to Beijing Shougang Company Limited
company or Shougang Co.
Shougang Group (Reforming from an enterprise owned by the whole people to
exclusively state-owned companies, name of Shougang Group is changed from
Shougang or Shougang Group Refers to
Shougang Corporation. The specific content is detailed in 15 June 2017 public
announcement.)
Listing Rules of SZSE Refers to Listing Rules of Shenzhen Stock Exchange
The Articles of Association Refers to The Articles of Association of Beijing Shougang Company Limited
Board of Directors or the
Refers to The board of directors of Beijing Shougang Company Limited
Board
Supervisory Committee Refers to The supervisory committee of Beijing Shougang Company Limited
Shareholders’ General
Refers to The Shareholders’ General Meeting of Beijing Shougang Company Limited
Meeting
Qiangang Co. Refers to Shougang Qian'an Iron&Steel Co., Ltd. (Branch of the Company)
Beijing Shougang Cold Rolling Co., Ltd. (Holding subsidiary of the Company, the
Cold-R Co. Refers to
Company holds 70.2806%)
Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd. (Holding subsidiary of
Zhixin Co. Refers to
the Company, the Company holds 66.2310%)
Beijing Shougang Steel Trading Investment Management Co., Ltd. (Wholly-owned
Steel Trading Refers to
subsidiaries of the Company)
The integrated production organization and product research and development system
Qianshun Base Refers to formed by Qiangang Co, located in Qian-an, Hebei province, and Cold-R Co., located
in Shunyi District, Beijing.
Shougang Jingtang United Iron&Steel Co., Ltd. (Holding subsidiary of the Company,
Jingtang Co./Jingtang Base. Refers to
the Company holds 70.1823%, Steel Trading Co. holds 29.8177%)
Since the shut down of the main process of iron and steel manufacturing in late 2010,
which was operated in Shijingshan District, Beijing, a transaction between the
Company and Shougang carried out. The transaction event was announced as "Related
Party Transactions between Beijing Shougang Co., Ltd. and Shougang Corporation -
First Reorganization, and Major Assets Swap and Asset Purchase through Issue of Shares". The event was
Previous Major Assets Refers to unconditional approved by China Securities Regulatory Commission Restructuring
Reorganization Committee on 16 January 2013. On 29 January 2014, the Company received the
approval document, named "The Approval of Related Party Transactions between
Beijing Shougang Co., Ltd. and Shougang Corporation - Major Assets Reorganization
and Asset Purchase through Issue of Shares", which was issued by China Securities
Regulatory Commission. On 25 April 2014, the reorganization was accomplished.
On 23 April 2015, trading in the shares of the Company was suspended and the major
assets swap launched. Main content of the swap is: 100% shareholding of Guizhou
Investment Co., Ltd. was replaced with 51% shareholding of Jingtang Co., any
insufficiency was paid in cash. This major assets swap was accomplished at the end of
Second Reorganization Refers to
2015. On 27 April 2016, re-election of the board of directors and amendment of
Articles of Association of Jingtang Co. was accomplished and the Company was
qualified to consolidate the financial statements of Jingtang Co. The second swap was
then accomplished.
Early Vendor Involvement means involving the downstream users at early stage of
product development process and fully understanding users’ requirements for raw
EVI Refers to
material so that high-performance materials and personalized services could be
offered to users.
Reporting Period Refers to From 1 January 2023 to 31 December 2023
Thousand, Million, Billion Refers to RMB Thousand, RMB Million, RMB Billion
5
Beijing Shougang Co. Ltd Annual Report 2023
Section II. Company Profile and Major Financial Indicators
I. Company information
Short name of stock Shougang Stock Stock code 000959
Stock exchange for listing of shares The Shenzhen Stock Exchange
Statutory Chinese name of the Company 北京首钢股份有限公司
The Chinese abbreviation of the Company 首钢股份
English name of the Company (if any) Beijing Shougang Co., Ltd.
Legal representative of the Company Qiu yinfu
Registered address Shijingshan Road, Shijingshan District, Beijing, PRC
Postal code of the registered address 100041
Historical changes in the registered address
N/A
of the Company
Office address No. 99 Shijingshan Road, Shijingshan District, Beijing, PRC
Postal code of the office address 100041
The Company’s website www.sggf.com.cn
Email address sggf@sgqg.com
II. Contact information
Secretary of the board
Name Qiao yufei
Correspondence address No. 99 Shijingshan Road, Shijingshan District, Beijing, PRC
Telephone 010-88293727
Fax 010-88292055
Email address qiaoyf1827@sgqg.com
III. Information disclosure and place for inspection
Stock exchange website for the disclosure of the annual
http://www.szse.cn/
report
China Securities Journal, Securities Times, Shanghai Securities Journal,
Media and website for disclosure of the annual report
Securities Daily. http://www.cninfo.com.cn
Place for inspection of the annual report Secretary office of the board of the Company
IV. Changes of registration
Organization code 911100007002343182
Changes of the core business since listing (if
No changes
any)
Changes of controlling shareholder (if any) No changes
V. Other relevant information
Accounting firm engaged by the company
Name of accounting firm Grant Thornton LLP
Address of accounting firm 5th Floor of Scitech Plaza, No. 22 Jianguomenwai Avenue, Chaoyang District, Beijing
Signed CPA Li Dan, Yu Qike
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
√ Applicable □ Non applicable
6
Beijing Shougang Co. Ltd Annual Report 2023
Name Office address Representatives Supervision period
Room 401, Building B7, Qianhai
Shenzhen-Hong Kong Fund Town,
Chai Qizhi, Zhang
Huatai United Securities Co., Ltd. No.128 guiwan Fifth Road, Nanshan 1 May 2021- 31 December 2023
Zhanpei
Street, Qianhai Shenzhen-Hong Kong
Joint Development Zone, Shenzhen
Building 4, 66 Anli Road, Chaoyang
China Securities Co., Ltd. Lv Jia, Chen Jian 1 May 2021- 31 December 2023
District, Beijing
Financial consultant engaged by the Company for performing continuous supervision duties in reporting period
√ Applicable □ Non applicable
Name Office address Representatives Supervision period
Room 401, Building B7, Qianhai
Shenzhen-Hong Kong Fund Town,
Chai Qizhi, Zhang
Huatai United Securities Co., Ltd. No.128 guiwan Fifth Road, Nanshan 1 May 2021- 31 December 2023
Zhanpei
Street, Qianhai Shenzhen-Hong Kong
Joint Development Zone, Shenzhen
Building 4, 66 Anli Road, Chaoyang
CITIC Securities Co., Ltd Lv Jia, Chen Jian 1 May 2021- 31 December 2023
District, Beijing
Financial advisors engaged by the company to perform continuous supervision duties during the reporting period
√ Applicable □ Non applicable
Name Office address Representatives Supervision period
Room 401, Building B7, Qianhai
Shenzhen-Hong Kong Fund Town,
Chai Qizhi, Zhang
Huatai United Securities Co., Ltd. No.128 guiwan Fifth Road, Nanshan 1 May 2021- 31 December 2023
Zhanpei
Street, Qianhai Shenzhen-Hong Kong
Joint Development Zone, Shenzhen
Building 4, 66 Anli Road, Chaoyang
CITIC Securities Co., Ltd Lv Jia, Chen Jian 1 May 2021- 31 December 2023
District, Beijing
VI. Major accounting data and financial indicators
Whether the Company has retroactive adjustment or re-statement on previous accounting data or not
√ YES □ NO
Reasons for retroactive adjustment or restatement
Business combination under common control
Changes over
2022 2021
last year
2023
Before the After the After the Before the
After the adjustment
adjustment adjustment adjustment adjustment
Operating revenue 113,761,443,633.43 118,142,183,549.47 118,142,183,549.47 -3.71% 132,984,304,668.28 132,984,304,668.28
Net profit attributable to
shareholders of the listed 663,754,519.41 1,124,540,659.14 1,124,540,659.14 -40.98% 7,106,480,663.26 7,106,480,663.26
company
Net profit attributable to
shareholders of the listed
527,672,139.72 1,052,510,876.43 1,052,510,876.43 -49.87% 7,014,226,910.72 7,014,226,910.72
company after deducting
non-recurring profit and loss
Net cash flows from operating
6,154,306,071.82 10,044,235,497.80 10,044,235,497.80 -38.73% 15,393,189,844.23 15,393,189,844.23
activities
Basic earnings per share 0.0856 0.1496 0.1496 -42.78% 1.1439 1.1439
Diluted earnings per share 0.0856 0.1496 0.1496 -42.78% 1.1439 1.1439
Weighted average return on net Reduce by
1.35% 2.42% 2.42% 19.42% 19.42%
assets 1.07 %
Changes over
31 December 2022 end 31 December 2021
31 December 2023 of last year
Before the After the After the Before the
After the adjustment
adjustment adjustment adjustment adjustment
Total assets 137,519,661,128.33 143,173,445,003.35 143,191,520,398.78 -3.96% 149,442,546,290.82 149,464,014,364.33
Net assets attributable to
shareholders of the listed 49,473,789,412.65 47,947,672,865.42 47,947,672,865.42 3.18% 41,647,543,198.14 41,647,543,198.14
company
7
Beijing Shougang Co. Ltd Annual Report 2023
Changes in accounting policies and correction of accounting errors
The reasons for changes in accounting policies are detailed in Section X, Changes in significant accounting policies and estimates.
The Company’s net profit before and after deducting non-recurring profit and loss in the last three fiscal years is negative, and the
audit profit of the last year presents that the Company’s ability of continuing operations is uncertain.
□ YES √ NO
The net profit before and after deducting non - recurring profit and loss is negative.
□ YES √ NO
VII. Difference of accounting data under accounting rules in and out of China
1. Differences of net profit and net assets in financial statements disclosed according to International Financial Reporting
Standards and Chinese Accounting Standards
□ Applicable √ Non applicable
There is no difference between the net profit and net assets in the financial statements disclosed in accordance with International
Financial Reporting Standards and Chinese Accounting Standards during the reporting period of the Company.
2. Difference of net profit and net assets in financial statements disclosed according to foreign accounting standards and
Chinese Accounting Standards
□ Applicable √ Non applicable
There is no difference between the net profit and net assets in the financial statements disclosed in accordance with foreign
accounting standards and Chinese Accounting Standards during the reporting period of the Company.
VIII. Major financial indicators by quarter in 2023
Unit: RMB Yuan
Q1 Q2 Q3 Q4
Total revenue 28,714,734,639.43 28,653,361,389.94 27,651,662,460.34 28,741,685,143.72
Net profit attributable to
-58,476,560.35 468,833,955.24 540,042,760.11 -286,645,635.59
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
-69,047,203.90 454,125,213.88 521,212,828.24 -378,618,698.50
after deducting non-recurring profit
and loss
Net cash flows from operating
-1,747,495,508.81 2,103,046,586.41 3,112,332,929.20 2,686,422,065.02
activities
Whether there are significant differences between the above-mentioned financial indicators or the sum and the relevant financial
indicators disclosed in the Company’s quarterly report and semi-annual report
□ YES √ NO
IX. Items and amounts of non-recurring profit and loss
√ Applicable □ Non applicable
Unit: RMB Yuan
Item 2023 2022 2021 Note
Gains and losses on disposal of non-current assets
(including the write-off that accrued for impairment of -22,066,115.49 -56,974,152.72 -55,726,886.68
assets)
Government grant included in the current profit and loss
(except for the government grant which are closely
137,487,616.66 67,816,372.72 48,447,356.52
related to the business of the company and are in
accordance with the national unified standard quota)
Profit and loss from external entrusted loans 8,990,991.36 11,275,389.73 10,518,170.49
Reversal of impairment provisions for accounts
33,127,315.83
receivable subject to separate impairment testing
Current net profit and loss of subsidiaries from the
beginning of the period to the date of business 55,404,276.08 92,145,653.81
combination under the common control
Other non-operating income and expenses except the
4,157,902.31 10,369,331.96 1,941,256.62
above items
8
Beijing Shougang Co. Ltd Annual Report 2023
Less: The impact of income tax 21,652,772.59 7,764,321.72 -950,188.41
The impact on non-controlling interests (post-tax) 3,962,558.39 8,097,113.34 6,021,986.63
Total 136,082,379.69 72,029,782.71 92,253,752.54 --
Particulars about other items that meet the definition of exceptional gain/loss:
□ Applicable √ Non applicable
During the reporting period, there is no other item that meet the definition of exceptional gain/loss.
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item listed in the Explanatory Announcement No.
1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss Items:
□ Applicable √ Non applicable
During the reporting period, there is no non-recurring profit and loss item defined and listed in "Explanatory Announcement No. 1 of
Information Disclosure of Companies offering securities to the public non-recurring profit and loss" as recurring profit and loss
items.
9
Beijing Shougang Co. Ltd Annual Report 2023
Section III. Discussion and Analysis of Business Operations
I. The industry situation of the Company during the reporting period
In 2023, China's economy maintained a positive trend of recovery and the growth of GPD was 5.2%. The upstream raw fuel prices in
the steel industry remain reletively high, while downstream demand has recovered less than expected. The year-on-year decline in
steel market prices is greater than that of the raw material end. Steel enterprises are facing significant pressure in production and
operation, and the industry as a whole is showing a trend of “weakened demand, price decline, high costs, and declining profits”.
According to data from the National Bureau of Statistics, in 2023, the production of crude steel and steel in China was 1.019 billion
tons and 1.363 billion tons, respectively, with a year-on-year growth of 5.2%. According to data from China Steel Association, the
average value of China Steel Price Index (CSPI) in 2023 was 111.60 points, a year-on-year decrease of 9.02%. Among them, the
average value of the board index was 111.53 points, a year-on-year decrease of 8.12%; The average value of the long material index
is 115.00 points, a year-on-year decrease of 10.24%.
On the upstream side, raw fuel costs fluctuate and differentiate. The procurement costs of main raw materials for key statistical
enterprises of China Steel Association have fluctuated, with domestic iron concentrate and imported fine ore procurement costs
increasing by 4.37% and 5.34% year-on-year, respectively. The procurement costs of coking coal, metallurgical coke, and scrap steel
have decreased by 18.75%, 21.57%, and 14.11% year-on-year, respectively.
Downstream, there has been a change in the consumption structure of steel. The demand for steel in the green and low-carbon driven
new energy industry is increasing, while the demand for traditional steel in industries such as automobiles, shipbuilding, and
household appliances is improving. Among them, the automotive industry has performed well driven by new energy vehicles and
exports, the shipbuilding industry has maintained a good development momentum, the wind power and photovoltaic industries have
maintained growth, the home appliance industry has recovered in line with expectations, and the real estate industry has continued to
be sluggish. Steel exports have significantly increased, while imports have maintained a downward trend. According to statistics from
the General Administration of Customs, China's cumulative steel exports in 2023 were 90.264 million tons, a year-on-year increase
of 36.2%; The cumulative import volume of steel was 7.645 million tons, a year-on-year decrease of 27.6%.
II. Main business of the Company during the reporting period
The Company continues to benchmark against world-class enterprises, firmly adheres to the strategic determination of "green
manufacturing, intelligent manufacturing, boutique manufacturing, lean manufacturing, and precision services", adheres to
innovation driven, and promotes technological innovation to become the company's first competitive advantage. Adhering to the
development direction of "boutique+service", continuously improving "manufacturing+service" capabilities, continuously optimizing
product structure, production line structure, and customer structure, and continuously promoting high-end product research and
development with a focus on electrical steel, automotive panels, and tin plated (chromium plated) plate. The Company has
transformed from a high-quality bar and wire production enterprise with a production capacity of 4 million tons in the early stage of
listing to a technology leading, green, and low-carbon technology company with a high-end plate production capacity of 21.7 million
tons.
The main business of the Company is the production and sales of steel products and metal soft magnetic materials (electrical steel)
1. Zhixin Co.
Zhixin Co. is a research and development, manufacturing, and sales base for metal soft magnetic materials (electrical steel), and is a
leading global manufacturer and service provider of electrical steel.
The products include two major series: oriented electrical steel and non oriented electrical steel. Among them, oriented electrical
steel includes six categories of products: high magnetic induction, magnetic domain refinement, low noise, low excitation, no bottom
layer, and medium frequency. Zhixin Co. has independently developed low-temperature slab heating technology to produce high
magnetic induction oriented electrical steel, becoming the fourth enterprise in the world to industrialize all low-temperature processes;
Non oriented electrical steel includes four major categories of products: new energy vehicles, stress relief annealing, high-efficiency,
and general-purpose, with stable batch production capacity for all grades.
The world's first high-grade non oriented electrical steel production line for new energy vehicles was completed in August 2022, and
the world's first specialized production line with 100% thin specification and high magnetic induction oriented electrical steel was
completed in April 2023.
2. Jingtang Co.
Jingtang Co, the large steel base, is a company with international advanced level designed and constructed in accordance with the
concept of circular economy. It has the obvious advantages of being near the sea and near the harbor, large equipments, high
production efficiency and low cost.
Iron and steel products of Jingtang Base include hot and cold plates. The hot plates mainly contain hot-rolled products, i.e., hot-rolled
pickling sheet, weather-resistant steel, automobile structure steel, high-performance construction steel, pipeline steel, shipboard,
marine steel, etc.; and also contain medium and thick plates products, such as bridge steel, energy steel, pipeline steel, etc. The cold
plates mainly contain: automobile sheet, tin sheet, cold-rolled special-use plate, color-coated sheet, etc. four main products series.
3. Qianshun Base
Iron and steel products of Qianshun Base is an important high-end plate production base in China, with world-class equipment and
industry-leading clean steel manufacturing technology, with high-end auto plate, high-end household appliance board full range of
supply capacity.
Iron and steel products of Qianshun Base include hot and cold plates. The hot plates mainly contain: hot-rolled pickle sheet,
10
Beijing Shougang Co. Ltd Annual Report 2023
weather-resistant steel, automobile structure steel, high-strength construction machinery steel, pipeline steel, etc. The cold plates
mainly contain: automobile sheet, cold-rolled special-use plate, etc.
III. Analysis of core competitiveness
1. Leading level of technology
The Company adheres to innovation driven approach and promotes technological innovation as its primary competitive advantage.
The Company and its subsidiaries Jingtang Co., Zhixin Co., Cold-R Co. are all high-tech enterprises, with R&D investment of
RMB5.022 billion during the reporting period, accounting for 4.41% of operating revenue. Relying on the "one institute, multiple
centers" R&D system, the company carries out in-depth technical research projects, optimize expert workstations, and solidify
external cooperation platforms. The incubation and efficiency creation of new products, technologies, and processes are constantly
accelerating. The significant progress made during the reporting period includes:
Patents: The Company has obtained 685 patent authorizations, including 229 invention patents. Zhixin Electromagnetic won the
Excellent Award at the 24th China Patent Award for two patents: "A Method and Device for Determining the Transmission Torque
of Cold Rolling Mills" and "A Non oriented Electrical Steel and Its Preparation Method and Application". "A Low temperature High
Magnetic Induction Oriented Silicon Steel Manufacturing Method with Excellent Bottom Layer" won the Excellent Award at the 1st
Hebei Provincial Patent Award.
Standards: The Company establishes the participated in the formulation and publication of 21 international, national, industry, and
group standards, with 6 of them leading the development.
Science and technology awards: The Company has received 21 provincial and ministerial level scientific and technological awards
and 8 provincial management innovation awards. Among them, 6 key technologies and applications for enhancing formability of
dual phase steel manufacturing won the first prize of Metallurgical Science and Technology Award, "New high-performance weather
resistant bridge steel and key application technologies" won the first prize of Hebei Province Science and Technology Award, and
"Development and operation management of high-end electrical steel products for steel enterprises to build global competitiveness"
won the first prize of National Management Innovation Achievement Award.
2. High-end products
The company adheres to the development strategy of continuously leading the way in electrical steel, refining and strengthening
automotive panels, and breaking through the high-end of tin plated (chromium plated) plate. It continuously increases the proportion
of strategic and key products, promoting both product quality and efficiency improvement. During the reporting period, the
production of the three major strategic products (electrical steel, automotive panels, and tinned (chrome) panels) increased by about
12% year-on-year, while the production of key products increased by about 17% year-on-year.
The production of electrical steel is 1.695 million tons, a year-on-year increase of about 14%, and the proportion of high-end
products is steadily increasing. In the electrical steel category, high-end products accounted for 65%, an increase of 2%
year-on-year. The production of high magnetic induction oriented electrical steel is 300,000 tons, an increase of about 46%
year-on-year. Ultra thin specifications of high magnetic induction oriented electrical steel with a thickness of 0.20mm and below
continue to maintain the top sales position in China. The structure of non oriented electrical steel products continues to be optimized,
with a production volume of 808,000 tons of high-grade non oriented electrical steel products, a year-on-year increase of about 11%.
Among them, the production volume of high-grade non oriented electrical steel products for new energy vehicles increased by about
29% year-on-year. 8 of the top 10 global sales companies for new energy vehicles have stable supply, and all of the top 10 domestic
sales companies have achieved stable supply.
The production of automotive panels reached 4.025 million tons, a year-on-year increase of about 12%, and new
breakthroughs were made in the adjustment of product structure and user structure. The product structure has been further
optimized, with the production of galvanized, high-strength, and outer panels increasing by about 21%, 15%, and 24% year-on-year,
respectively. The production of ultra-high strength and aluminum-silicon products has increased by about 6% and 39%, respectively.
The supply of UF steel has doubled year-on-year. The user structure has been further upgraded, with a steady increase in the number
and supply of core host factories. The supply of Japanese users has increased by about 38% year-on-year, while the supply of new
energy clients has increased by about 51% year-on-year.
The production of tin (chromium) plates reached 656,000 tons, a year-on-year increase of about 6%. The Company has
completed the industrial trial production of the DR-10 product for secondary cold rolling, achieved full coverage of DR material
brand numbers, stable mass production of 0.13mm food cans, and further improved manufacturing capabilities. The production of
functional drinks and easy to open lid products has reached a historic high, and the proportion of high-end varieties is steadily
increasing. Intensify overseas market development efforts and supply high sulfur resistant food cans to the Latin American market.
New progress has been made in promoting the specialization and differentiation of key products, serving national key
projects. Marine LNG fuel tanks were produced using 9Ni steel in 10 consecutive heats, with delivery volume tripling year-on-year;
High grade hydrogen pipeline steel is produced in bulk, and the product has achieved a demonstration application of tens of
thousands of tons in the first hydrogen blending pipeline in China; Successfully developed 18m ultra long pipeline steel in
collaboration with downstream pipeline factories, filling the gap in domestic ultra long pipelines; The photovoltaic bracket is made of
weather resistant steel to achieve full coverage of 490-800MPa level; Wind power steel achieved batch supply of 420MPa level
products, with a 6-fold increase in supply volume compared to the same period last year; Enamel steel (SRT550) has been
successfully applied in the 28,500 square meter ultra large tank project in the Dominican Republic.
3. Green and low-carbon
As the world's first steel enterprise to achieve full process ultra-low emissions, the Company has deeply promoted ultra-low emission
governance and maintained an A-level environmental performance evaluation in Hebei Province. The company adheres to the
high-quality development path of green and low-carbon, and actively promotes the practice of extreme energy efficiency and carbon
reduction technology around the national low-carbon strategy and customer carbon reduction needs.
The Company participated in the development of the TCISA 293-2022 Energy Efficiency Benchmarking Guidelines for Key
11
Beijing Shougang Co. Ltd Annual Report 2023
Processes in Steel Enterprises and the Demonstration Acceptance Standards and Methods for Energy Efficiency Benchmarks,
contributing to the promotion of the industry's ultimate energy efficiency engineering.
The Company has been awarded the titles of "Benchmark Enterprise for Green Development of Steel", "Advanced Collective for
Three Year Action Organization and Promotion of Energy Efficiency Benchmark for Ultimate Energy Efficiency Engineering of
Steel in 2023", and "Provincial Water saving Enterprise in 2023". Jingtang Co. has been awarded the first batch of "Pilot
Demonstration Units for Carbon Management System Construction" in Hebei Province. The EPD products of the company and its
subsidiaries, including hot-rolled steel plates and strips, cold-rolled steel plates and strips, hot-dip galvanized aluminum magnesium
alloy coated steel plates and strips, have been successfully released on the EPD platform in the steel industry. Five categories of
products, including oriented electrical steel, pipeline steel, non oriented electrical steel for new energy vehicles, hot-rolled
high-strength steel plates and strips for automobiles, and cold-rolled high-strength steel plates and strips for automobiles, have been
selected for the "Green Design Product List" of the Ministry of Industry and Information Technology.
4. Intelligent manufacturing
The Company has established a cross regional, multi base, and consistent integrated production and sales collaborative management
platform, with a digitalization rate of over 90% for production equipment, 51 "one click control" processes, 203 sets of "industrial
robots" and 26 "RPA process robots" applied, and 15 unmanned intelligent storage areas built.
During the reporting period, the focus was on promoting digital transformation and improving the level of intelligent manufacturing
around "integration of railway front", "construction of cold rolling lighthouse factories", and "Jingtang Smart Logistics Control
Platform". Complete the construction of the "Iron Front Integration" management system project, achieve data monitoring, collection,
and analysis of pellet, sintering, and blast furnace processes, and provide important support for reducing iron costs and improving
iron front integration collaborative control; The temperature drop control system for molten iron has been officially launched,
realizing functions such as visual tracking of torpedo tanks, on-demand iron production, and torpedo tank lifecycle management,
helping to improve the efficiency of molten iron logistics. The turnover rate of torpedo tanks has increased by one time per day
compared to the previous year. The second phase of the "Cold Rolling Lighthouse Factory" will launch 25 applications, realizing the
deepening application of intelligent manufacturing scenarios. The Jingtang Intelligent Logistics Control Platform achieves
automation and intelligence in transportation planning, vehicle scheduling, and route planning, resulting in an overall improvement
of 15% in logistics efficiency.
5. Supply chain security
The Company is the only platform for the development and integration of the steel and upstream iron ore resources industry of
Shougang Group, the controlling shareholder, in China. The supply of iron ore, coke, and coal resources for production is guaranteed
to be safe. In terms of iron ore, Shougang Group owns Shuichang Iron Mine and Xingshan Iron Mine with an annual production
capacity of 4 million tons of iron concentrate powder. At the same time, it controls Peru Iron Mine with an annual production
capacity of 20 million tons of iron concentrate powder. The annual production capacity of the iron concentrate powder at the ongoing
construction of Macheng Iron Mine is 7 million tons, which has the characteristics of high reserves, low cost, and efficient
transportation. After being put into operation, the company's iron ore resource guarantee capacity will be further improved. In terms
of coke, Qiangang Co.'s coke is mainly supplied by Qian'an Zhonghua Coal Chemical Co., Ltd., a joint venture between Shougang
Group and Kailuan Group, while Jingtang Co.'s coke is supplied by Tangshan Shougang Jingtang Xishan Coking Co., Ltd., a joint
venture between Jingtang Co. and Shanxi Coking Coal. The supply of coke resources is strongly guaranteed. In terms of coal, the
Company has signed long-term agreement with state-owned large coal groups, and Shougang Fushan Resources Group Co., Ltd., in
which Shougang Group holds shares, also provides the Company with some high-quality coking coal resources, providing strong
coal supply guarantee.
6. "Technology + Service" marketing
The Company takes the customer as the center to deepen the marketing strategy of "technology + service", and creates Shougang
service to enhance the brand value. The company continues to improve the service system, improve service efficiency, strengthen the
construction of new energy vehicle service team, meet customers' requirements for quality, delivery, research and development,
service, technical marketing continues to strengthen. EVI service capacity was improved year by year. During the reporting period,
EVI supply increased by 17% year-on-year. The product advantage analysis model established by the company promotes key
products to maintain competitive advantages and strategic products to expand leading advantages by strengthening product research
and development and improving manufacturing capacity.
A centralized, unified, rapid response, and efficient marketing management network has been formed, with a marketing center as the
core and a combination of 5 regional steel trading subsidiaries and 11 processing centers, effectively ensuring stable supply to
downstream customers. 15 large customer service teams have been established to consolidate and improve the channel structure that
combines leading enterprises in the industry chain with high-quality small and medium-sized customers. Cultivate comparative
advantages in industrial chain cooperation, carry out comprehensive, multi-level, and high-quality cooperation with key customers in
the industry, further enhance cooperation depth, enhance cooperation viscosity, and stabilize market share.
During the reporting period, the Company successfully held 5 product technology forums, including automotive panels and electrical
steel, and held "Shougang Day" activities in 5 main engine factories, including Nissan and Honda. It won 21 awards, including the
"Best Service Provider Award" from BMW Brilliance and the "Best Partner Award" from BYD. The Company also received 23
thank-you letters for efficient services from users such as the National Pipeline Network and FAW Volkswagen. The recognition of
Shougang's "Manufacturing+Service" continues to increase.
7. Talent thriving enterprise
The Company has deeply promoted the strategy of strengthening enterprises with talents, build a multi-level and comprehensive
training system for all employees, improved the talent promotion and evaluation mechanism, and facilitated the career development
path of talents. A career development system for high potential talents throughout their entire life cycle has been established, and
solidly promoted the "four horizontal and three vertical" training system for all employees, held training programs such as Deep Blue
Special Training Camp and Future Craftsman Youth Training Camp, strengthen talent empowerment, and build a platform for cadres
12
Beijing Shougang Co. Ltd Annual Report 2023
to improve and grow; Develop the Implementation Plan for the Incentive Mechanism of the Three Talent Teams of Shougang Co. in
2023, strengthen performance oriented and practical oriented, strengthen the training and development of high-level personnel, and
steadily increase the proportion of high-tech and high skilled talents.
During the reporting period, 1 position of the company was awarded the "National May Day Women's Model", 1 person was
awarded the "National May Day Labor Medal" and "National May Day Women's Model", 1 person was awarded the "Capital Labor
Medal", 1 person was awarded the "Beijing Great Craftsman", 2 people were awarded the "National Steel Industry Technical Expert",
2 people were awarded the "National Machinery and Metallurgical Building Materials Industry Craftsman", 1 person was awarded
the "Capital Most Beautiful Women's Struggler", and 1 person was elected the "Capital Citizen Learning Star".
IV. Analysis of principal business
1. Overview
(1) Completion status of the Company's main business indicators
During the reporting period, the Company's operating revenue was RMB 113.761 billion, a year-on-year decrease of 3.71%; The total
profit was RMB 900 million, a year-on-year decrease of 49.79%; The net profit attributable to shareholders of the listed company
was RMB 664 million, a year-on-year decrease of 40.98%; Earnings per share was RMB 0.0856, a year-on-year decrease of 42.78%;
The total assets was RMB 137.520 billion, and the equity attributable to the shareholders of the listed company was RMB 49.474
billion.
(2) Completion status of the Company's main product output and other indicators
① Metal soft magnetic materials (electrical steel)
Zhixin Co.: The production of metal soft magnetic materials (electrical steel) reached 1.695 million tons, a year-on-year increase of
14.2%. Among them, the production of oriented electrical steel were 300,000 tons, a year-on-year increase of 46.3%; 587,000 tons of
low to medium grade products without orientation, a year-on-year increase of 6.5%; 808,000 tons of non oriented high-grade
products, a year-on-year increase of 11.0%.
The sales volume of metal soft magnetic materials (electrical steel) is 1.7481 million tons, with a revenue of RMB 13.792 billion,
accounting for 12.12% of the Company's operating revenue.
② Iron and steel products
Qiangang Co. produced 8.708 million tons of steel, a year-on-year increase of 7.4%; Jingtang Co. produced 14.368 million tons of
steel, a year-on-year increase of 0.4%; The Cold-R Co. produced 1.83 million tons of cold-rolled sheets, a decrease of 0.5%
year-on-year. The sales revenue of steel products was RMB96.568 billion, accounting for 84.89% of the Company's operating
revenue.
No. Type Sales volume (tons in 0,000)
1 Billet 11.94
2 Hot rolling 1207.53
3 Cold rolling 934.86
(3) Highlights of the Company
In 2023, the company's business and production were smooth and stable, with stable and rising technical and economic indicators.
Significant achievements were made in product structure, technological innovation, green and low-carbon, and cost reduction and
efficiency improvement.
① Continuous optimization of product structure
The Company closely monitors changes in downstream demand, seizes opportunities for structural demand growth in industries such
as automobiles, wind power, and photovoltaics, focuses on efficiency, continuously promotes product structure optimization and
upgrading, and increases the proportion of strategic and key products.
During the reporting period, the total production of 3 strategic products (electrical steel, automotive plate, and tin (chromium) plate)
and 9 key products (cold-rolled special steel, hot-rolled pickling plate, weather resistant steel, energy steel, automotive structural
steel, high-strength engineering machinery steel, pipeline steel, bridge steel, and ship plate marine steel) was 15.93 million tons,
accounting for 69% of the company's total steel production, an increase of 6 percentage points year-on-year.
Sales volumes
No. Types
(tons in ‘0000)
1 Metal soft magnetic materials (electrical steel) 170
2 Automobile board 403
3 Tin plated (chromium plated) plate 66
4 Special steel for cold rolled 280
5 Weathering resistant steel 91
6 Automotive structural steel 78
7 Hot rolled pickled plate 213
8 High strength steel for construction machinery 59
9 Pipeline steel 33
10 Energy steel 93
11 Bridge steel 20
12 Shipboard marine engineering steel 89
The data in this table is rounded to the nearest whole number
③ Comprehensive promotion of technological innovation
13
Beijing Shougang Co. Ltd Annual Report 2023
The company is led by technological innovation, focusing on forging key core technology strengths. It continues to make new
breakthroughs in new product research and development, key process technologies, and promotes the transformation of enterprise
development quality towards higher efficiency, resilience, and sustainability.
In terms of new product development, 6 new products, including oriented electrical steel 15SQF1250, non oriented electrical steel
ESW1021, and high-strength automotive steel 980TBF, have been launched. Among them, the 15SQF1250 product is a new
intermediate frequency oriented electrical steel product for the future, providing key core materials for new energy generation
technologies such as wind power and photovoltaic, and meeting the development requirements of flexible exchange between AC and
DC in the future power grid; High strength and low iron loss non oriented electrical steel ESW1021, supporting the high-quality
development of the high-speed motor industry; 980TBF for high-strength automobiles has higher strength and better performance,
meeting the higher demands of downstream customers. Focusing on solving the "bottleneck" problem, we will continue to promote
26 localization projects of "substitute imports", resulting in a supply of 80000 tons.
In terms of key process technology, the company has pioneered the process equipment technology for cold rolling high-grade
silicon steel using a six stand six roll rolling mill, achieving a breakthrough in continuous rolling of non oriented electrical steel for
new energy vehicle drive motors and oriented electrical steel for high-efficiency energy-saving transformers. 96% of producs with a
lateral thickness difference of less than or equal to 5μ, which reaching the world's leading level; Pioneering the multi-mode
continuous rolling process for hot-rolled ultra-thin and high-strength steel strips, achieving efficient production of products with a
thickness of 1.1mm and a grade of 980MPa in headless mode, improving the rolling efficiency of thin and high-strength steel strips,
and enhancing the flexibility of production organization.
③ Green and low-carbon benchmark leading
The company has released and implemented the "Shougang Group Low Carbon Action Plan", building a carbon management
platform and a steel production full process LCA data collection system to achieve visualization of steel product carbon footprint and
steel production carbon emissions data. Through international certification bodies (SGS) carbon emissions certification, it is steadily
promoting low-carbon practices and forming a differentiated competitive advantage in products.
Steady progress has been made in reducing carbon emissions at the source. Jingtang Co's blast furnace operates stably with a
55% proportion of pellet ore, reducing carbon emissions by 10% compared to traditional processes. Qiangang Co has steadily
promoted the smelting experiment of 50% pellet ore in the blast furnace, and completed the industrial test of injecting biomass rich
hydrogen micro powder into the blast furnace at the hundred-ton level, which is a breakthrough in the use of biomass energy in steel
metallurgy in China.
The capacity of low carbon production achieve promotion. Carry out low-carbon product dedicated line experiments to enhance
technical carbon reduction capabilities, and achieve mass production of low-carbon automotive plate coating products with a
comprehensive carbon reduction of over 40% by adopting a 50% scrap steel ratio steel making process; For the first time in the
industry, a full series of GA low-carbon products, including IF steel, low-carbon aluminum killed steel, and ultra-high strength steel,
have been produced and customer formed trial production has been carried out. The comprehensive application evaluation from
automotive inner panels to outer panels has been completed, and low-carbon products have achieved the same quality as
conventional process flow.
Recycling and going up the stairs. The comprehensive utilization rate of solid secondary resources by Jingtang Co. and Qiangang
Co. has reached 99%. Jingtang Co. has established a new model of efficient conversion and cascading utilization of metallurgical
energy through the "combustion heat electricity water salt" five effect integrated high-efficiency recycling system, with a power
generation efficiency of over 47% and an annual emission reduction of about 400,000 tons of CO2.
④ Lowering costs and increasing efficiency to a new level
The Company strengthens benchmarking analysis, deeply explores the potential for cost reduction throughout the entire process and
all factors, constructs a sustainable cost reduction system, rolls forward key tasks of cost reduction and efficiency improvement,
effectively hedges external market profit reduction factors, and takes consumption cost reduction, technology cost reduction,
management cost reduction, and product structure efficiency improvement to a new level.
In terms of cost reduction in consumption, the Company strengthens the operation of the integrated platform for iron and steel
production. Qiangang Co. and Jingtang Co. adhere to the principles of economic material utilization, resource coordination and
mutual preparation, and focus on key indicators such as coal blending and ore blending costs and steel material consumption. The
cost of iron and steel processes continues to decrease; Breaking the process interface, the iron and steel system collaborates to control
sulfur economically, and the iron temperature drop of Qiangang Co. is below 100 ℃, breaking a new historical record.
In terms of cost reduction in technology, the Company has deepened the work of alloy substitution and process optimization, and
promote the optimal application of manganese based alloys; Through technological breakthroughs to improve control accuracy,
optimize product material design, and steadily increase product yield.
In terms of cost reduction management, the Company has established a collaborative mechanism between production and supply,
and carry out comprehensive and all factor material cost reduction; Strengthen equipment cost control, reduce operating costs
through measures such as negotiating cost reductions, domestic conversion, and self repair; the Company firmly pursue ultimate
energy efficiency, achieve full gas recovery and efficient utilization, and enhance the ability to balance and optimize the entire energy
system.
In terms of product structure efficiency enhancement, the Company adhere to the direction of high-end, distinctive, and
differentiated development, expand product competitive advantages, take product profitability as the guide, coordinate production
and sales, dynamically optimize product structure, and achieve an annual output of over 4 million tons of automotive panels.
2. Revenue and cost
(1) Composition of operating revenue
Unit：RMB Yuan
2023 2022
Year-on-year
Changes
Amount Proportion of operating Amount Proportion of operating
14
Beijing Shougang Co. Ltd Annual Report 2023
revenue revenue
Total operating revenue 113,761,443,633.43 100% 118,142,183,549.47 100% -3.71%
According to industries
Metallurgy 113,761,443,633.43 100.00% 118,142,183,549.47 100.00% -3.71%
According to products
Billet 420,010,787.22 0.37% 546,474,748.00 0.46% -23.14%
Hot-rolled steel 47,572,138,080.78 41.82% 48,304,009,189.85 40.89% -1.52%
Cold-rolled steel 46,496,393,503.18 40.87% 50,168,306,781.05 42.46% -7.32%
Metallic soft magnetic
13,791,974,212.14 12.12% 13,401,000,073.28 11.34% 2.92%
material
Other steels 2,079,869,284.47 1.83% 2,182,776,642.12 1.85% -4.71%
Other businesses 3,401,057,765.64 2.99% 3,539,616,115.17 3.00% -3.91%
According to regions
North China 46,411,595,797.83 40.80% 45,126,988,057.24 38.20% 2.85%
Northeast China 3,134,806,205.43 2.76% 2,585,270,587.07 2.19% 21.26%
East China 38,582,031,420.60 33.91% 40,848,885,782.99 34.58% -5.55%
Mid-South China 3,280,219,730.18 2.88% 3,246,213,129.88 2.75% 1.05%
South China 11,147,846,153.45 9.80% 15,338,953,399.84 12.98% -27.32%
Southwest China 1,954,223,073.95 1.72% 2,048,028,590.12 1.73% -4.58%
Northwest China 978,909,209.78 0.86% 1,256,111,815.93 1.06% -22.07%
Export 8,271,812,042.21 7.27% 7,691,732,186.40 6.51% 7.54%
Distribution model
Direct selling 105,489,631,591.22 92.73% 110,450,451,363.07 93.49% -4.49%
Sale by proxy 8,271,812,042.21 7.27% 7,691,732,186.40 6.51% 7.54%
(2) Industries, products, or regions that generated operating revenue or operating profit that over 10% of the total operating
revenue or operating profit of the Company
√ Applicable □ Non applicable
Unit: RMB Yuan
Year-on-year Year-on-year
Gross Year-on-year change of
Operating revenue Costs of sales change of costs of change of gross
margin operating revenue
sales margin
According to industries
Metallurgy 110,360,385,867.79 105,336,679,879.43 4.55% -3.70% -2.48% -1.20%
According to products
Billet 420,010,787.22 419,214,964.92 0.19% -23.14% -11.40% -13.23%
Hot-rolled steel 47,572,138,080.78 45,948,593,124.43 3.41% -1.52% -1.45% -0.07%
Cold-rolled steel 46,496,393,503.18 43,955,471,030.68 5.46% -7.32% -6.81% -0.53%
Metallic soft
13,791,974,212.14 13,112,850,675.32 4.92% 2.92% 10.64% -6.64%
magnetic material
Other steels 2,079,869,284.47 1,900,550,084.08 8.62% -4.71% 0.06% -4.36%
According to regions
North China 43,010,538,032.19 41,290,877,791.82 4.00% 3.42% 3.50% -0.07%
Northeast China 3,134,806,205.43 2,719,914,779.53 13.23% 21.26% 16.85% 3.27%
East China 38,582,031,420.60 37,298,563,933.51 3.33% -5.55% -3.12% -2.42%
15
Beijing Shougang Co. Ltd Annual Report 2023
Mid-South China 3,280,219,730.18 2,856,713,754.97 12.91% 1.05% -2.19% 2.88%
South China 11,147,846,153.45 10,849,438,123.11 2.68% -27.32% -26.65% -0.89%
Southwest China 1,954,223,073.95 1,674,246,176.87 14.33% -4.58% -7.18% 2.40%
Northwest China 978,909,209.78 887,536,495.72 9.33% -22.07% -18.37% -4.11%
Export 8,271,812,042.21 7,759,388,823.90 6.19% 7.54% 16.06% -6.89%
Distribution model
Direct selling 102,088,573,825.58 97,577,291,055.53 4.42% -4.51% -3.70% -0.80%
Sale by proxy 8,271,812,042.21 7,759,388,823.90 6.19% 7.54% 16.06% -6.89%
The adjusted principal business data according to the financial report of the Company under the circumstances that the statistical
ranges of the Company’s principal business data changed during the reporting period.
□Applicable √ Non applicable
(3) Whether revenue from sales of goods is more than from render of services
√ Yes □ No
Industry Item Unit 2023 2022 Year-on-year change
Sales Ton 23, 291, 347 22,066,038 5.55%
Metallurgy Output Ton 23, 175, 391 22,175,618 4.51%
Storage Ton 1,004,500 1,007,071 -0.26%
Explanation in the year-on-year change more than 30% based on aboved data
□ Applicable √ Non applicable
(4) Fulfillment of the singed significant sales contracts and purchase contracts during the reporting period
□ Applicable √ Non applicable
(5) Composition of costs of sales
Presented as industries
Unit: RMB Yuan
2023 2022
Year-on-year
Industry Item Proportion of Proportion of
Amount Amount change
costs of sales costs of sales
Metallurgy Raw materials 56,884,575,720.35 54.00% 56,640,251,091.58 52.44% 1.56%
Metallurgy Fuels 25,130,337,808.09 23.86% 31,007,832,547.47 28.71% -4.85%
Metallurgy Power cost 2,999,386,938.56 2.85% 1,825,623,929.41 1.69% 1.16%
Metallurgy Staff cost 3,340,122,566.08 3.17% 3,111,375,214.85 2.88% 0.29%
Metallurgy Depreciation 7,517,928,617.89 7.14% 7,279,948,522.16 6.74% 0.40%
Manufacturing
Metallurgy 9,464,328,228.47 8.98% 8,148,812,556.57 7.54% 1.44%
cost
Total 105,336,679,879.43 100.00% 108,013,843,862.04 100.00%
(6) Whether the scope of consolidation changes during the reporting period
√ Yes □ No
Please refer to the relevant contents of Section X. Changes in the scope of consolidation due to other reasons for details.
(7) Significant adjustments or changes in businesses, products, or services during the reporting period
□ Applicable √ Non applicable
(8) Major clients and suppliers
Major clients of the Company
Total top five clients in sales (RMB Yuan) 17,768,470,868.55
Proportion of total sales for the top 5 clients in total annual sales 15.62%
Proportion of the sales from related parties in total annual sales among the top five clients 2.25%
Information for top five clients of the Company
Serial Name Sales (RMB Yuan) Proportion of total annual sales
1 Client A 7,030,467,047.75 6.18%
2 Client B 4,332,334,910.05 3.81%
16
Beijing Shougang Co. Ltd Annual Report 2023
3 Client C 2,561,415,297.70 2.25%
4 Client D 2,161,815,227.57 1.90%
5 Client E 1,682,438,385.48 1.48%
Total -- 17,768,470,868.55 15.62%
Other information for the major customers of the Company
□ Applicable √ Non applicable
Major suppliers
Total purchase amount from top five suppliers (RMB) 74,129,568,481.66
Proportion of total annual purchase amount for top five suppliers 65.93%
Proportion of the purchase from related parties in total annual purchase among the top five suppliers 62.12%
Information for the top five suppliers of the Company
Serial Name Procurement (RMB Yuan) Proportion of total annual procurement
1 Shougang Group Co., Ltd. 46,426,530,213.29 41.29%
2 Supplier B 16,448,935,240.07 14.63%
3 Supplier C 6,960,115,662.67 6.19%
4 Supplier D 3,123,463,522.59 2.78%
5 Supplier E 1,170,523,843.04 1.04%
Total -- 74,129,568,481.66 65.93%
Other information for the major suppliers of the Company
□ Applicable √ Non applicable
3. Expenses
Unit: RMB Yuan
2023 2022 Year-on-year change Notes of material changes
Selling expenses 247,978,613.12 237,997,026.22 4.19%
Administrative expenses 1,289,613,009.53 1,271,175,739.06 1.45%
Finance expenses 1,353,210,253.87 1,731,584,291.35 -21.85%
Research and development
491,078,795.33 626,923,257.36 -21.67%
expenses
4. Research and development investment
√ Applicable □ Non applicable
Name of main R&D Progress of the Goals to be The expected impact on the company's
Project objective
project project achieved future development
The implementation of this project
provides improvement direction and
The flue gas emitted by the blast
Development of technical support for the flue gas
furnace hot blast stove during the
Optimization and treatment of similar internal combustion
combustion process contains
Repair Technology Developing new hot blast furnaces, provides experience
pollutants such as CO and NOx.
for Burner Structure Pilot stage technologies and and solutions for the online
In order to adapt to the current
of Internal equipment transformation of internal combustion hot
severe environmental situation,
Combustion Hot Air blast furnaces into top combustion hot
the flue gas treatment work of
Stove blast furnaces, and also provides new
the hot blast stove is imperative.
methods for reducing CO and NOx
emissions in steel processes.
The temperature of molten steel
Development and during the steelmaking process
application of a of the converter is affected by
The purpose of this project is to
prediction model for factors such as the ladle and
implement a temperature model, provide
the temperature of alloy, resulting in significant
Development Develop new better guidance for steelmaking positions,
molten steel inside fluctuations and higher control of
stage models reduce the tapping temperature of the
the ladle at the the steelmaking temperature.
converter, help improve the scrap ratio,
endpoint of Therefore, through mechanism
and reduce carbon emissions.
converter research, big data statistics, and
steelmaking other methods, the variation
pattern of molten steel
17
Beijing Shougang Co. Ltd Annual Report 2023
temperature is clarified to
provide better guidance for job
operations.
The implementation of the project helps
Research on This project aims to improve the
to suppress the oxidation and
Reducing Burning yield and product quality by
Developing new decarburization behavior during the
Loss and conducting research on reducing
R&D stage processes and heating process of the slab, improve the
Decarbonization burning loss and decarbonization
technologies product yield, improve product quality,
during the Heating during the heating process of
and further enhance the market
Process of Slabs slab.
competitiveness of the enterprise.
This project conducts research on
customer processes, uses, and
This project provides guidance for the
usage needs, and designs
production process of similar products
Research on Key production processes
through targeted process design, assists
Control accordingly. Based on the Developing new
customers in optimizing annealing
Technologies for characteristics of special steel Pilot stage processes and
processes, enhances product
Cold Used Special varieties, the composition is technologies
performance, and lays a solid foundation
Steel Production integrated, the production
for further enhancing the market
process is optimized, and the
competitiveness of the enterprise.
customer experience and product
profitability are enhanced.
This project aims to construct a
full process energy efficiency The implementation of this project helps
evaluation system and develop to clarify the key factors and influencing
Ultimate Energy
an implementation plan for full laws that affect the energy consumption
Consumption and
process energy efficiency Developing new of the entire process, comprehensively
Energy Efficiency
improvement technology, which Pilot stage processes and improve the energy efficiency level of the
Improvement of
can analyze the theoretical technologies entire steel process, and provide a
Main Processes and
energy-saving potential of each theoretical basis for the construction of a
Process Systems
process. Provide reference for smart industrial energy brain system in
future disruptive technology the future.
research and development.
The Jingtang Phase II
steelmaking process is the first
large-scale converter plant in
China to adopt VD as a single
vacuum refining equipment and To achieve high cleanliness and
incorporate it into normal high-quality coil production on the wide
production, achieving stable and thick plate casting machine
Research on the
operation of the two major production line, flexible and flexible
technology of
production lines of medium and Developing new production organization of different
combining LF and
thick plates and MCCR. Completion processes and production lines can be achieved. The
VD processes to
Research is conducted on the technologies product structure and capacity allocation
produce cold series
production of cold series clean can be adjusted in a timely manner
clean steel
steel using the VD process in the according to market conditions, reducing
Jingtang Phase II steelmaking production costs and providing a good
project, clarifying the issue of model for the industry.
mechanical rationality and
providing the correct direction
and reliable basis for optimizing
the production process.
Considering the characteristics of
thin specifications and high
Realize automatic re inspection of steel
Research and surface quality requirements of
coils with missing hole information on
development of hole tinplate products, with low cost
the acid rolling production line, reduce
and edge crack and strong practicality as the Developing new
the low work efficiency and risk of
detection starting point, we independently Completion processes and
missed inspections caused by manual re
technology for 1420 developed and designed a technologies
inspection, improve product quality
No. 7 heavy coil multifunctional online detection
reliability, and thus enhance the market
steel strip equipment that can detect both
competitiveness of hot-rolled products.
steel strip holes and edge tearing
defects.
Research and The preparation process of milk
To meet the performance requirements of
development of MR powder shaped cans is complex Developing new
users and provide reference and guidance
T-3 BA in tin and special. The composition Completion processes and
for the development of high-performance
plating production system of the substrate and technologies
ultra-high strength tinplate by Shougang.
line for milk powder various stages of the production
18
Beijing Shougang Co. Ltd Annual Report 2023
shaped cans process will affect its
microstructure, and have a
significant impact on the final
performance of the tin plated
plate. Exploring the
strengthening process of high
elongation DR tinplate,
providing reference and guidance
for the development of
high-performance ultra-high
strength tinplate by Shougang.
The Q500qE high-performance bridge
steel plate developed has been applied in
Research and batches to key projects such as Wuhu
Solve quality issues such as low
Development of Yangtze River Bridge and Changtai
strength, high yield to strength Developing new
High Grade Bridge Yangtze River Bridge, with a cumulative
ratio, and inadequate impact of Completion processes and
Steel in Medium supply of over 30000 tons. The
Q500qE high-performance technologies
and Heavy Plate performance control is stable, and the use
bridge steel plates.
Production Line effect has been highly praised by users,
making significant contributions to
China's transportation power strategy.
The project is based on a
scanning electron microscope in
situ stretching equipment,
conducting in-situ tensile
compression bending
experiments. Based on the
deformation theory of strip steel
during the stretching and
straightening process, a
combination of theoretical
analysis and experimental
Based on the research results, carry out
research is used to dynamically
large-scale production application
Research on the observe and analyze the micro
research, improve the evaluation and
Mechanism and deformation morphology and
testing of pickling effect under different
Process fracture mechanism of iron oxide
steel grades, different process parameters,
Optimization of scale. The fracture, Developing new
R&D stage and different degrees of iron sheet
Oxidation Layer fragmentation, and scaling processes
cracking, improve and solidify the
Fracture and mechanism of different steel
straightening process system, improve
Crushing in the grades of oxide scale under the
product quality, and reduce the
Straightening Unit stretching and straightening
consumption of recycled acid per ton of
process conditions are precisely
steel.
explained, and the scaling effect
is taken into account. At the
same time, research on
improving the shape of raw
materials is carried out, and
relevant modeling calculations
and analysis are carried out to
guide the formulation,
evaluation, and optimization of
existing stretching and
straightening process parameters.
This project adopts a
combination of model simulation
Research on the and computer experiments to
closed-loop conduct experimental research Through in-depth research on intelligent
feedback control on plate shape recognition and recognition of flatness patterns and
system for the shape control, and to achieve intelligent flatness control strategies, and combining
of the cold rolling recognition of plate shape Developing new with on-site conditions, a closed-loop
Pilot stage
continuous patterns; Establish a closed-loop processes feedback control system for flatness is
annealing and control system for the flatness established to reduce flatness defects and
leveling unit of machine, and achieve better improve the accuracy of plate shape
Shougang Shunyi closed-loop control of the control.
Cold Rolling flatness through precise
identification of the flatness.
Establish a closed-loop feedback
19
Beijing Shougang Co. Ltd Annual Report 2023
control model for the flatness,
and introduce the model into the
production line to verify its
effectiveness.
Research and
application of Develop and develop stamping
While improving the safety performance
phosphorus steel plates with high strength Develop new
of automobiles, it also increases the sales
containing and good formability, which Pilot stage processes and
revenue of enterprises and enhances their
high-strength steel have excellent formability and products
economic benefits.
and its preparation surface quality.
method
Research and Solve the existing acid rolling
application of acid process barrier, improve the Solved existing technological problems
Develop new
rolling process for mechanical properties of TRIP and achieved industrial production, which
Pilot stage processes and
producing 600 MPa steel, and manufacture TRIP can bring considerable economic
products
and 700 MPa TRIP steel with strength reaching benefits.
steel 600MPa and 700MPa levels.
Research will be conducted
around coarse and fine thickness
Developing core technologies for rolling
control, thickness compensation
Research and stability control of cold continuous
control, inter frame tension
Control Application rolling mills with independent intellectual
control, and thickness tension
of Digital Model property rights, improving thickness
coordination optimization
and Intelligent Develop new control accuracy and production process
control. Advanced intelligent R&D stage
Optimization for processes stability, in order to improve product
theories and technologies in the
Rolling Stability of quality, reduce scrap rates, and increase
field of data and algorithms will
Pickled Five operational rates, thereby enhancing the
be applied to explore intelligent
Continuous Rolling market competitiveness of enterprises and
solutions for thickness quality
expanding their market share.
control and achieve intelligent
quality control.
Breakthrough improvement in rolling
efficiency and product upgrading,
Obtain the influence of
Efficient Process development of more environmentally
steelmaking composition and
Development of friendly and energy-saving production
heat treatment process on the Develop new
Oriented Silicon Research stage processes, research and development of
primary and secondary products
Steel for Power greener and more efficient electrical steel
recrystallization of highly
Transformers products, and support the country's
efficient oriented silicon steel.
long-term goal of achieving carbon peak
and carbon neutrality.
Research and
Occupy the market share of high-end
application of
Developing high-strength non manufacturing in the green energy
high-strength non
oriented silicon steel products for Develop new storage industry, fill the gap in domestic
oriented silicon Research stage
variable speed pumped storage products variable speed pumped storage motors,
steel for variable
motors and expand the company's non oriented
speed pumped
silicon steel social influence.
storage motors
Research on Develop high silicon
Improve the overall performance level of
Preparation of High high-strength electrical steel
high-strength non oriented electrical steel
Strength Non products with performance Develop new
Research stage products, and provide assistance for the
oriented Electrical similar to that of Nippon Steel's products
smooth realization of the goal of "carbon
Steel by High high-strength electrical steel
peak and carbon neutrality".
Silicon Method products.
Research on the
Effect and Control
of Decarburization
Obtain the influence law of
and Nitriding
nitriding conditions on the oxide Improve the surface quality of oriented
Behavior on the Developing new
film; Guide DCL process Research stage silicon steel products, enhance their
Formation of Oxide processes
optimization and improve the market competitiveness and profitability.
Film in Low
proportion of underlying defects.
Temperature
Oriented Silicon
Steel
Development of Developing low excitation products to fill
Low Excitation Developed 23SQGD085 low Develop new market gaps, enhancing the company's
Trial stage
Products for excitation product products manufacturing capabilities for
Oriented Silicon cutting-edge products, and enhancing
20
Beijing Shougang Co. Ltd Annual Report 2023
Steel 23SQGD085 profitability.
Research and development investment
2023 2022 Proportion of changes
Number of R&D staff 2,481 2,342 5.94%
Proportion of R&D staff 13.61% 12.59% 1.02%
Educational background of R&D personnel
Bachelor’s degree 1,303 1,212 7.51%
Master’s degree 700 670 4.48%
Age structure of R&D personnel
Below 30 117 105 11.43%
30~40 1,231 1,273 -3.30%
Details about R&D investments:
2023 2022 Proportion of changes
R&D investments (RMB Yuan) 5,022,121,736.17 5,386,070,865.84 -6.76%
R&D investments as % of operating
4.41% 4.56% -0.15%
revenue
Capitalized R&D investments (RMB Yuan) 0.00 0.00 0.00%
Capitalized R&D investments as % of
0.00% 0.00% 0.00%
total R&D investments
Reasons for any significant change in the composition of R&D personnel and the impact:
□ Applicable √ Non applicable
Reasons for any significant YoY change in the percentage of R&D expense in operating revenue:
□ Applicable √ Non applicable
Reasons for any sharp variation in the percentage of capitalized R&D expense and rationale:
□ Applicable √ Non applicable
5. Analysis of cash flow
Unit: RMB Yuan
Item 2023 2022 Year-on-year changes
Cash inflow from operating activities 65,498,998,275.77 61,124,110,070.62 7.16%
Cash outflow from operating activities 59,344,692,203.95 51,079,874,572.82 16.18%
Net cash flow from operating activities 6,154,306,071.82 10,044,235,497.80 -38.73%
Cash inflow from investing activities 1,486,782,790.69 266,430,661.79 458.04%
Cash outflow from investing activities 2,428,854,960.16 3,428,494,466.51 -29.16%
Net cash flow from investing activities -942,072,169.47 -3,162,063,804.72 70.21%
Cash inflow from financing activities 36,413,359,368.93 36,440,713,251.59 -0.08%
Cash outflow from financing activities 41,050,137,224.35 43,529,541,314.07 -5.70%
Net cash flow from financing activities -4,636,777,855.42 -7,088,828,062.48 34.59%
Net increase in cash and cash equivalents 575,445,674.40 -206,656,369.40 378.46%
Main reasons for significant year-on-year changes in relevant data
√ Applicable □ Non applicable
(1) The decrease in net cash flow from operating activities is mainly due to the decline in steel prices in the current period and the
high price of upstream fuel, which leads to a greater decrease in cash received from selling products and providing services than
cash paid for purchasing goods and receiving services.
(2) The increase in cash inflow from investment activities is mainly due to the impact of New-E Co. disposal of the equity of Zhixin
Co. and recovery of investment funds.
(3) The decrease in cash outflow from investing activities is mainly due to the decrease in the cash receivd from disposal of
property, plant and equipment, intangible assets and other long-term assets.
(4) The increase in net cash flow from investing activities is due to the impact of New-E Co. disposal of the equity of Zhixin Co.
and recovery of investment funds.
(5) The increase in net cash flow from financing activities is mainly due to the decrease in debt repayment in the current period and
21
Beijing Shougang Co. Ltd Annual Report 2023
the investment received by Zhixin Co. from absorbing minority shareholder investments.
(6) The increase in the net increase in cash and cash equivalents is mainly due to the impact of New-E Co. disposal of the equity of
Zhixin Co. and recovery of investment funds.
Explanation of the significant difference between the net cash flow from operating activities and the annual net profit during the
reporting period.
√ Applicable □ Non applicable
During the reporting period, the cash flow generated from operating activities was RMB6.154 billion and the net profit was RMB754
million, the difference was RMB5.4 billion. The main reasons are: assets impairment provision of RMB552 million, depreciation and
amortization of RMB7.954 billion, financial expenses of RMB1.353 billion, a RMB-552 million in increase in receivables from
operating activites and RMB-4.243 billion in decrease in payables from operating activities, a RMB-764 million in increase in
inventory, an investment loss of RMB174 million, and RMB926 million for others.
V. Non-principal business analysis
□ Applicable √ Non Applicable
VI. Assets and liabilities
1. Significant changes in the composition of assets
Unit: RMB Yuan
Year-end of 2023 Year-begin of 2023
Proportion
Proportion of Proportion of Notes
Amount Amount changes
total assets total assets
Cash and Cash equivalents 9,153,205,626.37 6.66% 9,470,472,522.05 6.61% 0.05%
Accounts receivable 1,365,633,725.20 0.99% 1,450,008,897.10 1.01% -0.02%
Inventories 12,177,610,585.90 8.86% 11,960,246,748.15 8.35% 0.51%
Long-term equity investments 2,420,775,096.36 1.76% 2,724,285,925.35 1.90% -0.14%
Fixed assets 89,895,037,102.17 65.37% 93,331,072,969.17 65.18% 0.19%
Construction in progress 5,320,613,251.88 3.87% 7,673,649,852.77 5.36% -1.49%
Right-of-use assets 489,044,162.56 0.36% 83,107,359.45 0.06% 0.30%
Short-term borrowings 26,661,355,641.29 19.39% 29,580,006,103.39 20.66% -1.27%
Contract liabilities 4,699,449,813.28 3.42% 4,508,016,725.74 3.15% 0.27%
Long-term borrowings 12,789,060,000.00 9.30% 10,594,350,000.00 7.40% 1.90%
Lease liabilities 471,745,760.35 0.34% 72,439,836.79 0.05% 0.29%
Foreign assets account for a relatively high proportion:
□Applicable √ Non Applicable
2. Assets and liabilities measured at fair value
√ Applicable □ Non Applicable
Unit: RMB Yuan
Fair value Accumulated fair Impairment Amount of Amount of
Item Opening balance changes in the value changes in accrual in purchase in sales in the Other changes Closing balance
period equity the period the period period
Financial assets
Other equity
instruments 232,766,133.81 107,437,958.40 340,204,092.21
investments
Financing
3,489,134,871.56 -1,265,703,445.10 2,223,431,426.46
receivables
Other non-current
79,234,007.60 -4,224,788.99 75,009,218.61
financial assets
Total 3,801,135,012.97 -4,224,788.99 107,437,958.40 0.00 0.00 0.00 -1,265,703,445.10 2,638,644,737.28
Financial
0.00 0.00
liabilities
Whether the company's main asset measurement attributes have changed significantly during the reporting period
□ Yes √ No
3. Major restricted assets at the end of the reporting period
Unit: RMB Yuan
Year-end
Item
Book balance Book value Type of restriction Restriction reason
22
Beijing Shougang Co. Ltd Annual Report 2023
Cash and Cash equivalents 246,369,301.95 246,369,301.95 Freeze All kinds of deposits
Notes receivable 297,201,490.24 297,201,490.24 Pledge Pledged notes
Total 543,570,792.19 543,570,792.19
At the end of the period, except for various types of security deposits of RMB196,369,301.95 and fixed deposits of 50,000,000.00,
the Company has no funds pledged, guaranteed or blocked frozen or overseas balances that restricted to remittance back.
VII. Investment analysis
1. Overall situation
√ Applicable □ Non Applicable
Invested amount during the reporting period Investment amount during the previous reporting period
Change
(RMB Yuan) (RMB Yuan)
3,977,367,822.54 4,701,092,730.53 -15.39%
2. Significant equity investment during the reporting period
□ Applicable √ Non Applicable
3. Significant non-equity investment during the reporting period
√ Applicable □ Non Applicable
Unit: RMB Yuan
Reasons for
Fixed Actual
non-achieveme
asset Related Investment amount investment Realized income Date of Index of
Project Investme Capital Project Anticipated nt of planned
investme industri during the reporting amount up to the up to the end of disclosure disclosure
name nt method source schedule benefits schedule and
nt or not es period end of reporting reporting period (if any) (if any)
anticipated
(Y/N) period
income
Zhixin
Fixed asset
Co. Iron
transferred on
Oriented Self-built Y and 1,922,416.03 1,315,975,321.25 Self-raised 88.26% 391,380,000.00 136,799,335.98
estimated
phase II steel
value
project
Zhixin
The civil
Co.
foundation has
High-end
Iron been
heat
Self-built Y and 1,131,900,137.82 1,315,631,740.70 Self-raised 73.74% 436,810,000.00 completed and
treatment
steel equipment is
engineeri
being installed
ng
gradually
project
Total -- -- -- 1,133,822,553.85 2,631,607,061.95 -- -- 828,190,000.00 136,799,335.98 -- -- --
4. Financial assets investment
(1) Securities investment
□ Applicable √ Non Applicable
The Company has no securities investment during the reporting period.
(2) Derivatives investment
□ Applicable √ Non Applicable
The Company has no derivatives investment during the reporting period.
5. Use of raised funds
√ Applicable □ Non Applicable
(1) Overall use of raised funds
√ Applicable □ Non Applicable
Unit: RMB’0,000
Alternation of Proportion of
Accumulative
Total Total fundraising accumulative Purpose and Raised funds
amount of
Year for Method of Total Net fundraising fundraising purposes amount of Total unused usage of that have been
fundraising
fund-raising fund-raising fundraising fundraising used in the used during the fundraising fundraising unused left unused for
with altered
current period accumulatively reporting with altered fundraising over two years
purposes
Period purposes
Non-public
2022 291,200 273,36.82 6,944.03 28,796.50 0 0 0.00% 0 0
offering
Total -- 291,200 273,36.82 6,944.03 28,796.50 0 0 0.00% 0 -- 0
Explanation of the overall use of raised funds
In 2022, the total amount of supporting funds raised by the Company through non-public issuance of RMB ordinary shares (A-shares) was RMB291,199,983.58. After deducting the underwriting fees of
the lead underwriter, the Company's special account for fundraising received a subscription amount of RMB287,603,983.82; After deducting the independent financial advisor and other related expenses
for this restructuring, the net amount of raised funds is RMB273,368,221.41.
During the reporting period, RMB69.4403 million of raised funds were used for the comprehensive energy-saving and consumption reducing renovation project of Jingtang Co.'s railway front system.
As of December 31, 2023, the raised funds have been fully utilized.
(2) Committed projects of raised funds
√ Applicable □ Non Applicable
Unit: RMB’0,000
Whether Total Adjusted The Accumul Invest ment Date when Benef its Whet her Whet her
Committed investment projects and projects committe d total investme nt ative progre ss as the projec ts recor ded the estim there are
investment of excessive raised funds have been investme nt investme nt amount investme nt of the end are ready durin g the ated benefi mater ial
altered with raised amount (1) during the amount as of the for their Repor ting ts are reach chang es in
23
Beijing Shougang Co. Ltd Annual Report 2023
(including funds Reporting of the end Report ing intend ed Perio d ed the proje ct
partial Period of the Period (3) = use feasib ility
alternation) Reporting (2)/(1)
Period (2)
Committed investment projects
Jingtang Co. railway front system energy
Not
saving and consumption reduction No 125,000 13,636.16 6,944.03 13,636.16 100.00% No
applicable
comprehensive transformation project
Not
Supplementary liquidity No 125,000 15,160.34 0 15,160.34 100.00% No
applicable
Subtotal of committed investment projects -- 250,000 28,796.5 6,944.03 28,796.50 -- -- -- --
Investment of excessive raised funds
Not applicable
Total -- 250,000 28,796.5 6,944.03 28,796.50 -- -- 0 -- --
Explain the circumstances and reasons for
failing to achieve the planned progress and
estimated income by item (including the Not applicable
reasons why "Reach the estimated benefit" is
selected as "Not applicable")
Explanations of the material changes in the
Not applicable
project feasibility
Amount, use, and use progress of overraised
Not applicable
funds
Change of the implementation location of the
Not applicable
investment project raised funds
Adjustment of implementation methods of
Not applicable
investment projects with raised funds
Advance investment and replacement of
Not applicable
investment projects with raised funds
Temporary replenishment of working capital
Not applicable
with the idle raised funds
Surplus raised funds for project impleme
Not applicable
ntation and reasons for the surplus
Purpose and usage of unused fundraising Fully utilized
Problems in the use of raised funds and
Not applicable
disclosure, or other cases
(3) Altered projects of raised funds
□ Applicable √ Not applicable
The Company has no altered projects of raised funds in the reporting period.
VIII. Material disposal of assets and equity
1. Material disposal of assets
□ Applicable √ Non Applicable
The Company has no disposal of assets during the reporting period.
2. Material disposal of equity
√ Applicable □ Non Applicable
The net
profit The Whether it
contributed proportion of has been
by the equity net profit implemented
Transa related Has all the
to the listed Impact of contributed Pricing Related as planned as
ction party equity Disclos Discl
Counterpa Selling Sale company the sale on by the sale of principles relationship scheduled. If
price transac involved ure osure
rty equity date from the the equity to the for equity with the not, explain
(RMB’ tion or been date index
beginning of company total net sales counterparty the reasons
0,000) not transferred
this period to profit of the and measures
the date of listed taken by the
sale company company
(RMB’0,000)
8
enterprise
s
including
China
National
Building Realize
Materials 6.1483 equity exit
(Anhui) equity and
August
New shareholding 126,04 increase Asset
11, No N/A Yes Yes
Materials of Zhixin Co. 0.15 cash evaluation
2023
Industry held by inflow by
Investmen New-E Co. RMB706
t Fund million.
Partnershi
p
Enterprise
(Limited
Partnershi
p)
24
Beijing Shougang Co. Ltd Annual Report 2023
IX. Analysis of main holding companies and stock-jointly companies
√ Applicable □ Non Applicable
Main subsidiaries and stock-jointly companies that have an impact on the company's net profit of over 10%.
Unit: RMB Yuan
Company Registered Operating Operating
Type Main business Total assets Net assets Net profit
Name capital revenue profit
Shougang
Jingtang United Production and sales of steel
Subsidiary 35,821,676,294.00 75,149,357,110.08 36,006,424,412.55 68,493,729,633.33 640,823,510.40 554,063,170.19
Iron & Steel products and by-products
Co., Ltd.
Shougang
Zhixin Qian'an
Production and sales of steel
Electromagneti Subsidiary 11,299,828,445.19 21,111,582,247.88 14,481,778,917.31 14,317,006,979.29 356,074,454.21 308,135,956.50
products and by-products
c Materials Co.,
Ltd.
Acquisition and disposal of subsidiaries during the reporting period
√ Applicable □ Non Applicable
Method of acquiring and disposing
The impact on overall production,
Company Name of subsidiaries during the reporting
operation, and performance
period
Beijing Shougang New Energy Automobile Realize equity exit and increase cash
Derecognized after separation
Material Technology Co., Ltd. inflow by RMB706 million.
X. Structured entity controlled by the Company
□ Applicable √ Non Applicable
XI. Future development prospects
1. Industry pattern and development trend
In 2024, the basic trend of China's economy rebounding and improving has not changed. The global economy is expected to continue
a slow recovery trend, with increasing complexity and uncertainty due to currency contraction in major economies, ongoing
geopolitical conflicts, and the rise of trade protectionism. The steel industry is expected to continue the pattern of strong supply and
weak demand, and market competition will become more intense. However, with the implementation of national industrial policies
and measures to promote high-quality development, high-quality steel enterprises may welcome good development opportunities.
2. Development strategy of the Company
Shougang Co. focuses on promoting the construction of world-class enterprises and implementing the "Two Strong and Three
Excellent" project (to create a steel industry with strong profitability, innovation ability, asset quality, operational efficiency, and
energy conservation and environmental protection). It firmly adheres to the strategic determination of "green manufacturing,
intelligent manufacturing, boutique manufacturing, lean manufacturing, and precision services", adheres to the dual drive of
"capital+operation" and technological innovation to drive comprehensive innovation, and promotes the deepening of enterprise
reform, the improvement of new quality productivity, and the achievement of high-quality development. The steel industry adheres to
the development direction of "boutique+service", continuously promotes the research and development of three strategic products:
electrical steel, automotive plate, and tin (chromium) plate, continuously improves service level and operational efficiency, forms a
group of strategic product customer clusters with international competitiveness, and strives to build Shougang Co. into a steel listed
company with global competitiveness and influence.
3. Operating plans of 2024
(1) Output of products
Steel production reached 21.62 million tons, a year-on-year decrease of 6.23%. Among them:
① Qiangang Co.: 8.57 million tons of steel, a year-on-year decrease of 0.44%.
② Jingtang Co.: 13.05 million tons of steel, a year-on-year decrease of 9.18%.
③ Zhixin Co.: 1.81 million tons of electrical steel, a year-on-year increase of 4.68%. Among them: 1.5 million tons without
orientation, a year-on-year increase of 7.55%; Targeting 310,000 tons, a year-on-year increase of 3.23%.
④ Cold-R Co.: cold rolled sheet metal reached 2.05 million tons, a year-on-year increase of 12.03%. Among them, 950,000 tons of
continuous board refunds increased by 10.17% year-on-year; 1 million tons of galvanized sheet, a year-on-year increase of 6.54%;
100,000 tons of cold and hard coils, a year-on-year increase of 246.2%.
(2) Budget arrangement for financial indicators
RMB 108.26 billion for operating revenue, year-on-year decrease of 4.84%, including: RMB 38.63 billion for operating revenue of
parent company, year-on-year decrease of 0.76%; RMB 65.5 billion for operating revenue of Jingtang Co., year-on-year decrease of
4.37%; RMB14.3 billion for operating revenue of Zhixin Co., year-on-year decrease of 0.12%; RMB11 billion for operating revenue
of Cold-R Co., year-on-year increase of 7.61%; RMB 0.76 billion for operating revenue of Steel Trading, year-on-year decrease of
27.26%.
(3) Budget arrangement for cashflow
RMB 156.817 billion for cash inflows, including RMB 124.928 billion for cash inflow from operating activities, RMB 35 million for
cash inflow from investing activities, RMB 31.855 billion for cash inflow from financing activities.
RMB 155.707 billion for cash outflows, including RMB 113.629 billion for cash outflow from operating activities, RMB 4.256
billion for cash outflow from investing activities, RMB 47.823 billion for cash outflow from financing activities.
(4) Budget arrangement forfixed-assets project capital expenditure
Arrangement of fixed assets investment is RMB 4.123 billion, including: RMB 1.460 billion for Qiangang Co., RMB 2.037 billion
25
Beijing Shougang Co. Ltd Annual Report 2023
for Jingtang Co., RMB 516 million for Zhixin Co., RMB 71 million for Cold-R Co., RMB 39 million for Steel Trading.
4. Potential risk
(1) Policy and industry risk
In order to consolidate the achievements of supply side reform and establish the goals of "carbon peak and carbon neutrality", the
national policy will continue to strictly control the addition of new steel production capacity and continuously eliminate outdated
production capacity through capacity replacement. However, due to the fact that capacity replacement mainly focuses on large
advanced blast furnaces, electric furnaces, and converters, output efficiency has significantly improved. Therefore, the overcapacity
situation in the industry will not change in the short term, and the competitive environment in the industry remains severe.
To cope with the above risks, firstly, it is necessary to enhance the awareness of market entities, closely monitor and timely study
macro policies, upstream and downstream industrial chains, and industry development changes, strengthen market prediction and
analysis, improve rapid response capabilities, and enhance the ability to resist market risks. The second is to take the market as the
lead, fully leverage the advantages of production lines and products, enhance the "manufacturing+service" capabilities, promote deep
optimization and adjustment of product and channel structures, strengthen the promotion of first product and new product markets,
and organize projects to replace imported products, expanding the high-end product cluster. The third is to enhance market awareness
and operational capabilities, deepen system and professional collaboration, enhance production and sales guarantee capabilities,
adhere to seeking benefits from the market and collaboration, and continuously improve profitability and market competitiveness;
The fourth is to focus on forging the "manufacturing+service" long board, continuously launching overall solutions for different
application scenarios, and meeting customer needs with high quality.
(2) Low carbon environmental risk
As the time for the steel industry to be included in the national carbon market for carbon trading compliance approaches, the
ecological environment department has put forward higher requirements for annual carbon emission reporting and verification work;
Under the background of the "carbon peak and carbon neutrality" policy, downstream customers have put forward higher
requirements for the company's carbon reduction work; The EU Carbon Border Adjustment Mechanism (CBAM) bill has officially
come into effect, requiring domestic steel product exporting companies to provide carbon emission related data.
To address the aforementioned risks and demands, firstly, the Company will firstly accelerate the construction of a low-carbon
management system, promote the implementation of low-carbon action plans, apply comprehensive carbon reduction technologies,
and focus on creating low-carbon product dedicated lines to meet customer carbon reduction needs. The second is to deepen the
construction of the LCA system, standardize carbon data management, improve data quality, and meet verification and certification
requirements. The third is to continuously build a low-carbon supply chain system, select low-carbon raw materials, and promote the
low-carbon process of procurement, production, transportation, and other processes.
(3) Horizontal competition risk
There is a certain degree of industry competition between the Company and its controlling shareholder Shougang Group and its
affiliates.
In order to address industry competition, during the first restructuring, Shougang Group issued a commitment on measures to resolve
industry competition and avoid industry competition after this restructuring. According to the steel industry development plan of
Shougang Group, Shougang Co. will serve as the only platform for the development and integration of Shougang Group's steel and
upstream iron ore resource industries in China, ultimately achieving the overall listing of Shougang Group's steel and upstream iron
ore resource businesses in China. Afterwards, Shougang Group made further commitments based on the aforementioned industry
competition commitments. These commitments have been fulfilled on schedule, please refer to the corresponding content of
"Corporate Governance" in this annual report for details.
(4) Marketing risk
In 2024, the steel industry is expected to continue the pattern of strong supply and weak demand, and market competition will
become more intense. With the decrease in demand for construction steel, the production capacity of long materials is rapidly shifting
towards sheet metal, and is constantly spreading towards the subsequent process and high-end products of sheet metal. The supply
pressure of sheet metal varieties is increasing, and structural contradictions are accumulating. Enterprises are facing significant
pressure in their operations.
To cope with the above risks, firstly, the company will adhere to the principle of asking questions in the market, staying on the spot,
seizing opportunities in the structural changes of market demand, continuously paying attention to the development trends of the
industry, focusing on building competitive advantages, stabilizing cooperation with leading enterprises, keeping up with industry
upgrading and development, continuously developing the end user market, and extending and expanding to the full coverage of mid
to high end user groups. The second is to promote the organic combination of technological innovation and marketing services,
adhere to the responsibility and mission of "service creates value", based on meeting user needs, guided by improving user service
experience, and create comparative advantages in enterprise technology marketing services. The third is to fully leverage the
advantages of multiple production lines and rich varieties, promote deep optimization and adjustment of product and channel
structures, and improve the contribution of structural adjustments to business efficiency.
(5) Related transactions risk
Related party transactions between Shougang Co. and Shougang Group and its affiliated enterprises, Shougang Co. and Shougang
Group signed the framework agreement of related transactions in accordance with the stock listing rules and other provisions for
regular related transactions. If the agreement cannot be strictly executed in the future, interests of the Company will be damaged and
also the risks of related transactions will emerge.
The Company will strictly comply with various regulations on related party transactions, fulfill information disclosure obligations in
accordance with the Stock Listing Rules and Articles of Association, ensure the openness, fairness, and impartiality of related party
transactions, and safeguard the legitimate rights and interests of the company and all shareholders. The above-mentioned daily
related party transactions are ongoing related party transactions that exist in the normal operation and production process of the
company. Both parties have followed the legal approval procedures and signed in accordance with regulations, which will not affect
the independence of the Company.
26
Beijing Shougang Co. Ltd Annual Report 2023
XII. Reception of research, communication, interview and other activities during the
reporting period
√ Applicable □ Non Applicable
Main contents and
Time Location Method Type Counterparty Reference for basic information
provided material
AM: Small and
medium-sized
Provide an explanation
investors.
AM: of the company's
PM: Institutional
Panoramic production and
investors such as
network operation situation, as
Everbright Securities,
studio well as the
Guotai Junan The details disclosed on the
performance results
April 21, 2023 （http://ir.p5w Others Others Securities, Huachuang interactive platform on April 24,
achieved in the first
.net） Securities, Changjiang 2023
quarter of 2022 and
PM: Company Securities, Guangfa
2023, and answer any
conference Securities, CITIC
questions that investors
room Securities, Haitong
may be concerned
Securities, Guosen
about
Securities, Northeast
Securities, etc
Online Performance
Briefing: All Investors
Online Specific Investor
performance Performance Briefing:
briefing: Analysts from
panoramic institutions such as
network CICC, Huachuang
Provided an
studio Securities, Everbright
explanation of the
Securities, CITIC
（https://rs.p5 company's production
Securities, Guotai The details disclosed on the
August 14, w.net/html/13 and business
Others Others Junan Securities, China interactive platform on August
2023 9408.shtml） performance in the first
Merchants Securities, 16, 2023
Specific half of 2023, and
Changjiang Securities,
Investor answered questions of
Guangfa Securities,
Performance concern to investors
Industrial Securities,
Briefing: Northeast Securities,
Company Zhongtai Securities,
conference Xingquan Fund,
room Nanhua Futures, and
Securities Daily
reporters, etc
Analysts from
Answering questions
institutions such as
from investors
CICC, Yinhua Fund,
regarding the
Penghua Fund,
Company company's main The details disclosed on the
August 18, Telephone Pengyang Fund,
conference Institution products, performance, interactive platform on August
2023 communication Beijing Yanhang Asset
room future development 22, 2023
Management, PING
plans, and
AN ASSET
environmental control
MANAGE, and
impacts
Guangfa Securities
Online Performance
Briefing: All Investors
Online Specific Investor
performance Performance Briefing:
briefing: Analysts from
panoramic institutions such as
network CICC, Huachuang Provided an
studio Securities, Everbright explanation of the
Securities, Guotai company's production
（https://rs.p5
Junan Securities, China and business The details disclosed on the
October 27, w.net/html/14
Others Others Merchants Securities, performance for the interactive platform on October
2023 0726.shtml） Changjiang Securities, first three quarters of 29, 2023
Specific Guangfa Securities, 2023, and answered
Investor Industrial Securities, questions of concern to
Performance Huatai Securities, investors
Briefing: Zhongtai Securities,
Company Guoxin Securities,
conference CICC Asset
room Management, and
Dongzheng Asset
Management
November 17, Company Analysts from Provide answers to The details disclosed on the
Field research Institution
2023 conference institutions such as investor concerns interactive platform on
27
Beijing Shougang Co. Ltd Annual Report 2023
room Guangfa Securities, regarding the November 19, 2023
China Canada Fund, company's electrical
Defeng Investment, steel products,
Jiahe Fund, CICC, production capacity,
Danshui Spring demand for automotive
(Beijing) Asset panels, development
Management, plans, R&D
Shangcheng Asset investment, capital
Management, Taiyang expenditures, and raw
Asset Management, fuel conditions
Zhengyuan Investment,
Xueshi Asset
Management,
Industrial Bank,
Zhengxingu Capital,
and Yuanxin
Investment
Provide answers to
Analysts from future industry
institutions such as demands that investors
Everbright Securities, are concerned about,
Company The details disclosed on the
December 8, Guoshou Asset changes in electrical
conference Field research Institution interactive platform on December
2023 Investment, Hezhong steel prices, production
room 9, 2023
Asset Management, capacity of automotive
Jiutai Fund, and panels, future capital
Changsheng Fund expenditures, and raw
material costs
XIII. Implementation of the Action Plan for "Double Improvement of Quality and Return"
Whether the Company disclosed an action plan for "dual improvement of quality and return" or not.
□ Yes √ No
28
Beijing Shougang Co. Ltd Annual Report 2023
Section IV. Corporate Governance
I. Information of corporate governance
In accordance with the Company Law of People’s Republic of China, the Securities Law of People’s Republic of China, the Code of
Corporate Governance for Listed Companies, Self-regulatory Guide for Listed Companies of Shenzhen Stock Exchange No. 1 -
Business Management, the Articles of Association and other applicable regulations and laws, the Company establishes a sound
internal control system, actively promotes the improvement of corporate governance structure, continuously deepens standardized
operation, improves the level and quality of corporate governance, innovates interactive communication channels, maintains good
investor relations, and protects the legitimate rights and interests of the Company and all shareholders
According to the Articles of Association, the Rules of Procedure of the Shareholders' Meeting, the Rules of Procedure of the Board
of Directors, and the Rules of Procedure of the Board of Supervisors, the company shall organize the convening of the Shareholders'
Meeting, the Board of Directors Meeting, and the Board of Supervisors Meeting; Directors and supervisors are diligent and
responsible, comply with rules and regulations, and actively safeguard the legitimate rights and interests of the company and
shareholders; The management operates in accordance with the law and strictly adheres to the company's various internal control
systems; The company shall fulfill its information disclosure obligations in accordance with normative documents such as the Stock
Listing Rules, and ensure the truthfulness, accuracy, and completeness of the company's information disclosure, without any false
records, misleading statements, or significant omissions.
During the reporting period, the company mainly carried out corporate governance work in the following aspects: firstly, based on
the company's repurchase and cancellation of stocks, adjustments made to the special committees under the board of directors, and
other actual situations, 72 systems such as the Articles of Association and the Regulations on the Work of the Board's Strategy, Risk,
ESG and Compliance Management Committee were revised. The second is to develop 20 systems, including the "Management and
Evaluation System for Personnel Dispatched to Participating and Holding Enterprises" and the "ESG Work Management System",
according to operational needs. The third is to organize internal control self-evaluation based on actual business adjustments, system
updates, and other factors, combined with the Risk Control Manual and Internal Control Evaluation Manual. The fourth is to
comprehensively promote the construction of the "1+2+N" compliance and legal management system, focusing on the requirements
of compliance management, contract management, and legal management, and become the first enterprise in the steel industry to
pass compliance certification. Fifthly, in accordance with the relevant provisions of the Articles of Association and the Rules of
Procedure of the Shareholders' Meeting, the shareholders' meeting shall be convened through "on-site+online voting" to ensure that
the matters submitted for review and approval by the shareholders' meeting are in compliance with the law.
As at the end of the reporting period, the Company has a total of 495 regulations, among which 491 regulations are formulated and
implemented by the company and 4 regulations are forwarded to the government and regulatory authorities
Whether there are material differences between the actual state of corporate governance and the regulatory documents issued by the
CSRC on the governance of listed companies.
□ Yes √ No
There is no material difference between the fact of corporate governance and the regulations for listing companies required by the
CSRC.
II. Independence of the Company from the controlling shareholder and actual controller in
terms of assets, personnel, finance, organization, business
The company strictly plans and operates in accordance with the law, maintaining complete independence from its controlling
shareholders in terms of assets, personnel, finance, institutions, and business. The company has a complete procurement, production,
marketing, and business management system, a complete product research and development organization and personnel, and the
ability to independently produce and operate.
1. Assets: The Company has a production system and its supporting facilities that are independent of the controlling shareholder and
its related parties. The Company's assets are independent and complete, with clear ownership.
2. Personnel: The Company has a complete human resources management system, which operates independently and has a sound and
effective system. The directors and supervisors of the Company are elected in accordance with the statutory approval procedures
such as shareholders' meetings or corresponding democratic elections; senior management personnel are appointed or dismissed by
the Board of Directors, and there are no irregularities in their concurrent positions with controlling shareholders and related parties.
3. Financial: The Company has an independent financial management department, equipped with full-time financial personnel, with a
complete internal financial accounting and management system and perfect financial management system, which is sound and
capable of making independent financial decisions, and the Company is independently and legally subject to taxation.
4. Institutions: The Company has a general meeting of shareholders, the board of directors, the board of supervisors, managers and
other corporate governance structure, a complete organizational system, independent operation, independent exercise of power. And
there is no subordinate relationship with the controlling shareholder and its related parties.
5. Business: The Company has a complete raw fuel procurement, product manufacturing, product marketing and management system,
an independent business system, conducts its business independently, operates independently and bears its own risks.
III. Horizontal competition
√ Applicable □ Not applicable
29
Beijing Shougang Co. Ltd Annual Report 2023
Type of
Name of Nature of
association Work progress and
Type controlling controlling Causes Solutions
with the follow-up plan
shareholder shareholder
Company
1. Shougang Group undertakes in
respect of measures to resolve inter-sector
competition and avoid inter-sector
competition after the First Reorganisation
(1) Except for the situation of
inter-sector competition existing prior to the
date of this Letter of Undertaking, if the
Company obtains opportunities for
acquisition, development and investment in
the same or similar business as Shougang Co,
the Company will immediately notify
Shougang Co and offer them to Shougang Co
for selection on a priority basis and make its
best efforts to make such business
opportunities available for transfer to
Shougang Co.
(2) In integrating and operating existing
steel assets not yet transferred to Shougang
Co., the Company will select the appropriate
platform and means to achieve resource
integration in a manner that is conducive to
the future transfer to Shougang Co. and will
not include provisions in the relevant
agreements or arrangements with partners or
third parties that restrict or prohibit the
injection of such assets or businesses into
Shougang Co. In December 2021,
(3) The Company will, as far as possible, Shougang Co., Ltd. and
safeguard the normal operation and Shougang Group signed
profitability of the existing steel assets not
the "Management Service
injected into Shougang Co. and ensure that
Agreement between
the aforesaid assets and businesses do not fall
Shougang Group Co., Ltd.
into operational difficulties due to the
Since the listing And Beijing Shougang
Company or other circumstances that prevent
of the Company, Co., Ltd. On The Affiliated
the ultimate injection into Shougang Co. or
there has been Enterprises of Shougang
render such injection legally impeded.
inter-sector Group Co., Ltd. ".
(4) Each commitment made by the
The Shougang competition and Shougang Co., Ltd.
Competition in the Company in eliminating or avoiding
controlling Group Co., Local SASAC connected provides management
same industry competition in the same line of business shall
shareholder Ltd. transactions services for a total of 14
also apply to other enterprises under the
resulting from target enterprises in the
direct or indirect control of the Company
the partial steel sector of Shougang
other than Shougang Co. and its subsidiaries,
conversion to Group. Shougang shares
and the Company is obliged to supervise and
listing. will continue to negotiate
ensure that the other subsidiaries of the
Company implement the arrangements for with Shougang Group and
each of the matters described in this actively promote the
document and strictly comply with all the follow-up work in
commitments. accordance with the
2. As approved by the second commitment to resolve
extraordinary general meeting of the horizontal competition.
Company for 2018 on 27 December 2018,
Shougang Group undertakes to:
(1) According to the development plan
of Shougang's steel industry, Shougang shares
will serve as the sole platform for the
development and integration of Shougang
Group's steel and upstream iron ore resources
industries in the PRC, and ultimately realise
the overall listing of Shougang Group's steel
and upstream iron ore resources businesses in
the PRC.
(2) In the event that Shougang
Group's other companies engaged in steel
operations and production further optimise
and adjust their product structure through
active implementation of national industrial
policies and environmental protection
requirements, and achieve profits for three
consecutive years, and that the overall
situation of the industry does not fluctuate
significantly, Shougang Group will, in
accordance with the requirements of
securities laws and regulations and industry
policies, initiate a process including but not
limited to acquisition, merger, restructuring
and other means in the interests of
30
Beijing Shougang Co. Ltd Annual Report 2023
Type of
Name of Nature of
association Work progress and
Type controlling controlling Causes Solutions
with the follow-up plan
shareholder shareholder
Company
shareholders of the listed company The
injection of relevant high-quality assets into
Shougang will be completed within 36
months after the commencement of the
relevant matters.
IV. General shareholders’ meetings and extraordinary shareholders’ general meeting during
the reporting period
1. Information on the general shareholders meeting
Investor
Sessions Type Date Date of Disclosure Conference resolution
participation ratio
Annual General Please refer to the company announcement
2022 Annual General
Shareholders 84.22% June 30, 2023 July 1, 2023 on the disclosure date of the meeting
Meeting
Meeting resolution
Extraordinary
Please refer to the company announcement
2023 First Extraordinary General September 28, September 29,
77.81% on the disclosure date of the meeting
General Meeting Shareholders 2023 2023
resolution
Meeting
Extraordinary
2022 Second Please refer to the company announcement
General December 28, December 29,
Extraordinary General 83.59% on the disclosure date of the meeting
Shareholders 2023 2023
Meeting resolution
Meeting
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √ Not applicable
V. Directors, Supervisors, Senior Management
I. General information
Reasons
Number Number
Number Number for
of shares of shares
of shares of shares changes
held at reduced
Status of Start date End date increased Other held at in the
Name Gender Age Position the in the
employment of term of term in the changes the end of increase
beginning current
current the or
of the period
period period decrease
period (shares)
of shares
Qiu
Male 56 Chairman Incumbent 2023/12/28 2025/12/22 290,000 0 290,000 0 0
Yinfu
Zhu
Male 46 Director Incumbent 2023/9/28 2024/3/21 0 0 0 0 0
Guosen
Zeng Li Male 52 Director Incumbent 2022/12/23 2024/3/21 290,000 0 95,700 0 194,300
Li
Male 45 Director Incumbent 2022/12/23 2025/12/22 0 0 0 0 0
Jiantao
Gu Independent
Male 62 Incumbent 2021/12/20 2025/12/22 0 0 0 0 0
Wenxian director
Independent
Yu Jiaxi Male 65 Incumbent 2022/12/23 2025/12/22 0 0 0 0 0
director
Independent
Liu Shen Male 48 Incumbent 2020/6/23 2025/12/22 0 0 0 0 0
director
Peng Independent
Male 44 Incumbent 2020/6/23 2025/12/22 0 0 0 0 0
Feng director
Supervisory
Sun Yi Male 58 board Incumbent 2021/11/29 2025/12/22 0 0 0 0 0
chairman
Guo
Female 48 Supervisory Incumbent 2016/1/7 2024/1/9 0 0 0 0 0
Liyan
Chang
Female 39 Supervisory Incumbent 2022/12/23 2025/12/22 0 0 0 0 0
Haiyu
Employee
Wang
Male 45 representative Incumbent 2022/12/23 2025/12/22 0 0 0 0 0
Xingtao
supervisor
Employee
Qu
Male 42 representative Incumbent 2021/7/7 2025/12/22 0 0 0 0 0
Erlong
supervisor
Zhu General
Male 46 Incumbent 2023/8/18 2024/3/21 0 0 0 0 0
Guosen manager
Sun Vice general
Male 47 Incumbent 2022/12/23 2024/3/21 261,000 0 86,130 0 174,870
Maolin manager
Liu Chief
Male 43 Incumbent 2023/8/18 2025/12/22 0 0 0 0 0
Tonghe accountant
31
Beijing Shougang Co. Ltd Annual Report 2023
Xie Vice general
Male 42 Incumbent 2022/10/27 2025/12/22 203,300 0 66,990 0 136,310
Tianwei manager
Wang Vice general
Male 41 Incumbent 2022/10/27 2025/12/22 203,000 0 66,990 0 136,310
Kai manager
Secretary of
Qiao
Female 35 the Board of Incumbent 2023/10/26 2025/12/22 0 0 0 0 0
Yufei
Directors
Zhao
Male 57 Chairman Resignation 2013/5/16 2023/12/28 0 0 0 0 0
Mingge
Liu Managing
Male 59 Resignation 2014/9/19 2023/8/17 290,000 0 95,700 0 194,300
Jianhui Director
Independent
Ye Lin Male 60 Resignation 2017/12/26 2023/12/25 0 0 0 0 0
director
Zhang Vice general
Male 47 Resignation 2022/10/27 2023/10/8 232,000 0 232,000 0 0
Binglong manager
Li Chief
Male 58 Resignation 2015/10/28 2023/8/17 261,000 0 86,130 0 174,870
Baizheng accountant
Li Vice general
Male 57 Resignation 2017/10/25 2023/7/21 261,000 0 86,130 0 174,870
Jingchao manager
Secretary of
Chen Yi Male 56 the Board of Resignation 2015/8/26 2023/10/26 0 0 0 0 0
Directors
Vice general
Chen Yi Male 56 Resignation 2019/4/24 2023/11/27 261,000 0 86,130 0 174,870
manager
Total - - -- -- -- -- 2,552,300 0 1,191,900 0 1,360,700 --
During the reporting period, did any directors and supervisors resign and was any members of the senior management resigned
during their term of office
√ Yes □ No
For details, please refer to "Changes in directors, supervisors and senior manager".
Changes in directors, supervisors and senior manager
√Applicable □Not applicable
Name Position Type Date Reason of changes
Resignation upon
Zhao Mingge Chairman Resignation 2023/12/28
transfer of work
Director/ General Resignation upon
Liu Jianhui Resignation 2023/8/17
manager transfer of work
Resignation upon Resignation upon
Ye Lin Independent director 2023/12/25
expiration of term expiration of term
Resignation upon
Zhang Binglong Vice general manager Resignation 2023/10/8
transfer of work
Resignation upon
Li Baizheng Chief accountant Resignation 2023/8/17
transfer of work
Resignation upon
Li Jingchao Vice general manager Resignation 2023/7/21
transfer of work
Secretary of the Board Resignation upon
Chen Yi Resignation 2023/10/26
of Directors transfer of work
Resignation upon
Chen Yi Vice general manager Resignation 2023/11/27
transfer of work
II. Current position
Professional background, main work experience and main responsibilities of the current director, supervisors, and senior manager of
the Company
A. Board members
1. Qiu Yinfu: The chairman of the Company, University degree, Master of Business Administration in Senior Management, Senior
Engineer. Formerly served as a professional and deputy director of the Mobility Department at Shougang Medium and Thick Plate
Plant, deputy director, department head, and party branch secretary of the Mobility Department at Shougang Second Steelmaking
Plant, head of the Mobility Department and party branch secretary at Beijing Shougang Co., Ltd. Second Steelmaking Plant, deputy
director and director of Shougang Oxygen Plant, director of Shougang Oxygen Plant and director and party branch secretary of
Shougang Qiansteel Company's Oxygen Plant, director of Shougang Oxygen Plant and director and party branch secretary of
Shougang Qiansteel Company's Oxygen Plant, party branch secretary, and project leader of Jingtang Support, director of Shougang
Oxygen Plant and project leader of Jingtang Support, Tangshan Shougang Baoye Company Director of the Oxygen Plant, Leader of
the Cold Rolling Preparation Group of Shougang Relocation Company, Director of the Cold Rolling Operations Department of
Shougang Relocation Company, Assistant General Manager and Director of the Cold Rolling Operations Department of Shougang
32
Beijing Shougang Co. Ltd Annual Report 2023
Relocation Company, Assistant General Manager and Director of the Cold Rolling Operations Department and Party Secretary of
Shougang Relocation Company, Deputy General Manager and Director of the Cold Rolling Operations Department and Party
Secretary of Shougang Relocation Company, Deputy Party Secretary, Director, and General Manager of Beijing Shougang Cold
Rolling Thin Plate Co., Ltd., Chairman, Deputy Party Secretary, and General Manager of Beijing Shougang Cold Rolling Thin Plate
Co., Ltd, Deputy General Manager of Beijing Shougang Co., Ltd. and Chairman, Deputy Secretary of the Party Committee, and
General Manager of Beijing Shougang Cold Rolled Thin Plate Co., Ltd., Deputy Secretary of the Party Committee, Chairman of the
Trade Union, and Deputy General Manager of Beijing Shougang Co., Ltd. and Secretary of the Party Committee of Qian'an Iron and
Steel Co., Ltd., Deputy Secretary of the Party Committee, Chairman of the Trade Union, Director, and Deputy General Manager of
Beijing Shougang Co., Ltd. concurrently serve as Secretary of the Party Committee of Qian'an Iron and Steel Co., Ltd., Secretary and
Chairman of the Party Committee of Shougang Jingtang Iron and Steel United Co., Ltd. also serve as Director of Beijing Shougang
Co., Ltd., Deputy Secretary and Director of the Party Committee of Shougang Group Co., Ltd. also serve as Director of Beijing
Shougang Co., Ltd., Deputy Secretary, Director, and Union of the Party Committee of Shougang Group Co., Ltd. The Chairman
concurrently serves as a Director of Beijing Shougang Co., Ltd., Deputy Secretary of the Party Committee, Director, and Chairman
of the Trade Union of Shougang Group Co., Ltd., and Deputy Secretary, Director, and General Manager of the Party Committee of
Shougang Group Co., Ltd. The current Deputy Secretary of the Party Committee, Director, and General Manager of Shougang Group
Co., Ltd., and Chairman of Beijing Shougang Co., Ltd.
2. Zhu Guosen: The director of the Company, Doctoral degree, Doctor of Engineering, Professor level Senior Engineer. Formerly
served as a researcher at the Plate and Strip Research Institute of Shougang Technology Research Institute, a researcher, deputy
director (deputy director), deputy director (deputy director, in charge of work), and director (chief director) at the Thin Plate
Research Institute of Shougang Technology Research Institute, assistant to the president of Shougang Technology Research Institute
and director of the Thin Plate Research Institute (chief director), chief engineer (deputy department) of Shougang Jingtang Iron and
Steel United Co., Ltd., deputy secretary and first vice president of the Party Committee of Shougang Group Technology Research
Institute, secretary and first vice president of the Party Committee of Shougang Group Technology Research Institute, deputy
secretary of the Party Committee of Beijing Shougang Co., Ltd., deputy secretary and general manager of the Party Committee o f
Beijing Shougang Co., Ltd. The current Deputy Secretary of the Party Committee, Director, and General Manager of Beijing
Shougang Co., Ltd.
3. Zeng Li: The director of the Company, the senior engineer, being a master of engineering with postgraduate education. The major
employment history of Mr. Zeng is as follows: Mr. Zeng used to be a technician, head of technical section, deputy chief of technical
section, deputy chief of technical section (in charge of work), chief of technical section and deputy director of steelmaking workshop
of Shougang No. 3 Steelmaking Plant, director of No. 2 Steelmaking Plant of the Company, director and Secretary of General Party
Branch of Qiangang Co., director of the Second Steelmaking Plant of the Company, director of the Steelmaking Branch of Qiangang
Co., Secretary of the General Party Branch and Deputy Director of the Steelmaking Operation Department of Jingtang Co., assistant
to the general manager and director of the steelmaking plant of Tangshan Shougang Baoye Iron and Steel Co., Ltd., director of the
Second Steelmaking plant of the Company, deputy director of the steelmaking Operation Department of Jingtang Co., deputy chief
engineer and director of the chief Engineer's Office (Chief Engineer's Office of Beijing Shougang New Steel Company) of Shougang
Corporation, Director of the deputy chief Engineer and chief Engineer's Office of Shougang Corporation (Beijing Shougang New
Steel Company Chief Engineer's Office), director of the manufacturing Department of Jingtang Co., deputy chief engineer of
Shougang Corporation and director of the Manufacturing Department of Jingtang Co., deputy chief engineer of Shougang
Corporation, deputy general manager of Jingtang Co., deputy chief engineer of Shougang Corporation, director and deputy general
manager of Jingtang Co., director and deputy general manager of Jingtang Co., deputy Secretary of the Party Committee, director and
general manager of Jingtang Co. At present, Mr. Zeng is currently a director of Beijing Shougang Co., Ltd., Secretary of the Party
Committee and Chairman of Jingtang Co.
4. Li Jiantao: The director of the Company, the intermediate economist with Bachelor's Degree. The major employment history of
Mr. Li is as follows: Mr. Li used to be a member of Finance Department of Baosteel Group Shanghai No. 1 Iron and Steel Co., Ltd.,
a member of Finance Department of Shanghai No. 1 Iron and Steel Co., Ltd., a member of asset Management Section, Deputy
Director of Finance Department and Deputy Director of Finance Department of Baosteel Group Shanghai No. 1 Iron and Steel Co.,
Ltd., a deputy director of Finance Department and Deputy Director of Transportation Reform Department of Baosteel Group
Shanghai No. 1 Iron and Steel Co., Ltd., Senior Manager of expense Management of Operating Finance Department of Baosteel
Group (Head Office), Senior Manager of expense Management of Operating Finance Department of China Baowu Iron and Steel
Group Co., L Ltd., Senior Manager of Fund Management of Finance Department of China Baowu Iron and Steel Group Co., L Ltd.,
and Fund Director of Finance Department of China Baowu Iron and Steel Group Co., Ltd. Currently, Mr. Li is director of capital
Operation Department and Capital Operation Center of China Baowu Iron and Steel Group Co., Ltd., and director of Beijing
Shougang Co., Ltd.
5. Gu Wenxian: The independent director of the Company, a senior accountant and Certified Public Accountant in China with
bachelor's degree. He used to be a teacher of Shanghai Railway Medical College, a teacher of Shanghai Fisheries University, a senior
manager of Dahua Certified Public Accountants LLP, a senior manager of Ernst & Young Da Hua Certified Public Accountants, and
a member of the first, second and third mergers and acquisitions Committee of China Securities Regulatory Commission. Mr. Gu is
now a senior partner and director of BDO China Shu Lun Pan Certified Public Accountants LLP. Gu Wenxian serves Shougang Co.
as an independent director from 20 December, 2021.
6. Yu Xingxi: The independent director of the Company. Graduate degree, Master of Management, Senior Accountant. Formerly
served as a soldier in the 1st Company of the 46th Regiment of the 10th Division of the Railway, a soldier in the Logistics Service
Society of the New Management Department of the 10th Division of the Railway, a soldier in the Finance Department of the New
Management Department of the Qinghai Tibet Line of the Railway, an assistant in the Finance Department (platoon) of the New
Management Department of the Qinghai Tibet Line of the Railway, the director of the 4th Police Station (deputy company) of the
New Management Department of the Qinghai Tibet Line of the Railway, an accountant in the Finance Department (deputy
department) of the New Management Department of the 10th Division of the Railway, a clerk in the Finance Department (deputy
33
Beijing Shougang Co. Ltd Annual Report 2023
department) of the New Railway Transportation Department of the 20th Bureau of the Railway, the deputy head and deputy head of
the Finance Department of the Planning and Statistics Department of the 5th Division of the 20th Bureau of the Railway, the deputy
head and head of the Finance Department of the Construction Vice President of the Construction Department (Zhengke), Deputy
President and Accountant of the Construction Department (Zhengke) of the Railway 20th Bureau, General Manager and Accountant
of the Construction Department of the Railway 20th Bureau, General Manager and Senior Manager of the Finance Department and
Fund Settlement Center of China Railway Construction Corporation, Deputy Director and Senior Manager of the Finance
Department and Fund Settlement Center of China Railway Construction Corporation, Manager and Senior Manager of the
Investment Department of China Railway Construction Corporation, Minister and Senior Manager of the Finance Department of
China Railway Construction Corporation, Minister and Senior Manager of the Finance Department of China Railway Construction
Corporation Limited, Secretary of the Board of Directors and Joint Company of China Railway Construction Corporation, News
Speaker and Senior Manager of China Railway Construction Corporation, The Secretary General of the Beijing Listed Companies
Association also serves as an independent director of Ruitai Technology Co., Ltd., Beijing Kerui International Co., Ltd., and China
National Pharmaceutical Group Co., Ltd. Current independent director of Ruitai Technology Co., Ltd. and independent director of
China National Pharmaceutical Group Pharmaceutical Co., Ltd. Appointed as an independent director of Beijing Shougang Co., Ltd.
on December 23, 2022.
7. Liu Shen: The independent director of the Company with doctor's degree. The major employment history of Mr. Liu is as follows:
Once served as an employee of the real estate credit department of Shanghai Branch of China Construction Bank, assistant manager,
manager and senior manager of the listed company Department of Shanghai Stock Exchange, executive manager and assistant
director of the office of Shanghai Stock Exchange, assistant director of the second Supervision Department of listed company of
Shanghai Stock Exchange, deputy director of the issuance and listing business center of Shanghai Stock Exchange and member
Department of Shanghai Stock Exchange Deputy director. During the period, Mr. Liu worked in the issuance Supervision Department
of China Securities Regulatory Commission (CSRC), and is a member of the 16th main board stock issuance examination committee
of CSRC. At present, Mr. Liu is the vice general manager of Shanghai Xinfugang Real Estate Development Co., Ltd., an independent
director of Shanghai Kangheng environment Co., Ltd. (unlisted company) and an independent director of Guizhou Guotai Liquor Co.,
Ltd. (unlisted company). Mr. Liu serves as an independent director of Beijing Shougang Co., Ltd. since 23 June 2020.
8. Peng Feng: The independent director of the Company, a professor level senior engineer with master's degree. The major
employment history of Mr. Peng is as follows: Mr. Peng once served as assistant engineer, engineer and deputy director of Smelting
raw materials department of Metallurgical Industry Planning and Research Institute, chief designer and vice director of smelting raw
materials department of Metallurgical Industry Planning and Research Institute, chief designer and director of smelting raw materials
department of Metallurgical Industry Planning and Research Institute. At present, Mr. Peng is vice chief engineer and chief designer
of Metallurgical Industry Planning and Research Institute, director of smelting raw materials department, vice chairman of ferroalloy
branch of China Society for metals, and executive deputy secretary of Zhongguancun Stainless Steel and Special Alloy New Material
Industry Technology Innovation Alliance. Mr. Peng serves as an independent director of Beijing Shougang Co., Ltd. since 23 June
2020.
B. Supervisors
1. Sun Yi: The chairman of supervisory Board of the Company, a senior economist with doctor's degree of Economics. The major
employment history of Mr. Sun is as follows: A cadre of machinery workshop of Changchun Bus Factory in Jilin Province, a
research secretary in the factory director's office, a staff member, section member, deputy director section member of Jilin Provincial
Labor Department labor Management Office, a deputy director of the First General Affairs Department, a director of the first General
Affairs Department, chief secretary of the secretariat and deputy secretary of the Secretariat of jilin Provincial Government general
Office, Director, deputy general manager, chairman of the trade union, standing member of the Party Committee, secretary of the
Discipline inspection Commission and Secretary of the Party Committee of Tonghua Iron & Steel Co., Ltd. Mr. Sun is currently the
Director of the Work Office of the Supervisory Board of Shougang Group Co., Ltd., and the Chairman of the Supervisory Board of
Beijing Shougang Co., Ltd.
2. Guo Liyan: The supervisor of the Company, a senior accountant with master's degree. The major employment history of Mrs.
Guo is as follows: She has served as a member of finance Department of Machinery Factory of Shougang Mechanical and Electrical
Company, auditor of Audit Office of Shougang Mechanical and Electrical Company, chief of Finance Department of Hydraulic
Center of Shougang Mechanical and Electrical Company, Deputy Director of Fund Department of Finance Department of Shougang
Mechanical and Electrical Company, Deputy Director of Cost Department of Finance Department of Shougang Mechanical and
Electrical Company, Deputy station chief of financial dispatch station of Technical Research Institute of Finance Department of
Shougang Mechanical and Electrical Company, Deputy Director of Audit Division I (in charge of work) of the Audit Department of
Shougang Corporation, Assistant Director and Deputy Director of the Audit Department of Shougang Corporation, Director of the
audit Department of Shougang Corporation and supervisor of Beijing Shougang Co., Ltd. Mrs. Guo is the current director of audit
department of Shougang Group and the current supervisor of Shougang Co.
3. Chang Haiyu: The supervisor of the Company, an intermediate economist with master's degree. The major employment history of
Mr. Chang is as follows: He used to be senior manager of Financing Management Department of Beijing State-owned Capital
Operation Management Co., Ltd., senior manager of key Account Department of head office of Zheshang Bank Co., Ltd., and
assistant to general manager of Capital Operation Department of Beijing Financial Holding Group Co., Ltd. Currently, he is the
investment director of Beijing Jingguorui Equity Investment Fund Management Co., Ltd., and the supervisor of Beijing Shougang
Co., Ltd.
4. Wang Xingtao: The employee representative supervisor of the Company, a senior marketer with bachelor's degree. The major
employment history of Mr. Wang is as follows: He used to be a member of supply and Marketing Department of Shougang First-line
material Factory, a salesman of Sales Department of high-quality Profile Sales Department of Shougang Sales Company, a researcher
of price Management Department of Marketing Management Department of Shougang Sales Company, a deputy chief of price
Management Department of Marketing Management Department of Shougang Sales Company (probation period of one year), a
34
Beijing Shougang Co. Ltd Annual Report 2023
deputy chief of price Management Department of Marketing Management Department of Shougang Sales Company, and a
professional manager of marketing Management Department of Marketing Management Department. Currently, he is the
professional manager of marketing Office of Marketing Management Department of Marketing Center and the employee
representative supervisor of Beijing Shougang Co., Ltd.
5. Qu Erlong: The employee representative supervisor of the Company, a senior marketer with bachelor's degree. The major
employment history of Mr. Qu is as follows: Mr. Qu worked as a worker in Shougang High-speed Wire Mill, Shougang Equipment
Maintenance Center, Qiangang Co. Equipment Maintenance Center, Qiangang Company Equipment Maintenance Center, Beijing
Shougang Co., Ltd. Equipment Department, hot-rolling Operation Department.
C. Senior manager
1. Zhu Guosen: The general manager of the Company, Doctoral degree, Doctor of Engineering, Professor level Senior Engineer.
Formerly served as a researcher at the Plate and Strip Research Institute of Shougang Technology Research Institute, a researcher,
deputy director (deputy director), deputy director (deputy director, in charge of work), and director (chief director) at the Thin Plate
Research Institute of Shougang Technology Research Institute, assistant to the president of Shougang Technology Research Institute
and director of the Thin Plate Research Institute (chief director), chief engineer (deputy department) of Shougang Jingtang Iron and
Steel United Co., Ltd., deputy secretary and first vice president of the Party Committee of Shougang Group Technology Research
Institute, secretary and first vice president of the Party Committee of Shougang Group Technology Research Institute, deputy
secretary of the Party Committee of Beijing Shougang Co., Ltd., deputy secretary and general manager of the Party Committee o f
Beijing Shougang Co., Ltd. The current Deputy Secretary of the Party Committee, Director, and General Manager of Beijing
Shougang Co., Ltd.
2. Sun Maolin: The deputy General Manager, University degree, Senior Management Master of Business Administration, Senior
Engineer. Formerly served as a professional in the Technical Department of Shougang Medium and Heavy Plate Plant, Deputy
Secretary and Deputy Section Chief of the Party Branch of the Hot Rolling Section, Secretary of the Party Branch of the B
Operation Area, and Deputy Director of the Technical Research Department; Deputy Director of the Technical Department of
Shougang Qiangang Company (in charge of work), Assistant Director of the Technical Quality Department, Deputy Director of the
Silicon Steel Department (in charge of work), Executive Deputy Director of the Silicon Steel Department, and Deputy Director of
the Silicon Steel Business Unit; Deputy Director and Deputy Director of Silicon Steel Business Unit of Qian'an Iron and Steel
Company of Shougang Corporation (in charge of work); Vice Minister (in charge of work) and Minister of Silicon Steel Business
Department of Beijing Shougang Co., Ltd; Secretary of the Party Committee and Minister of the Silicon Steel Business Unit of
Beijing Shougang Co., Ltd; Secretary of the Party Committee and Minister of the Silicon Steel Business Unit of Beijing Shougang
Co., Ltd., and Director of the Silicon Steel Engineering Technology Research Center; Assistant to the General Manager of Beijing
Shougang Co., Ltd., Secretary and Minister of the Party Committee of the Silicon Steel Business Unit, and Director of the Silicon
Steel Engineering Technology Research Center; Vice General Manager of Beijing Shougang Co., Ltd., Secretary of the Party
Committee of the Silicon Steel Business Unit, and Director of the Silicon Steel Engineering Technology Research Center; Deputy
General Manager of Beijing Shougang Co., Ltd., Director of Silicon Steel Engineering Technology Research Center, Party
Secretary and Executive Director of Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd; Vice General Manager of
Beijing Shougang Co., Ltd., Director of Silicon Steel Engineering Technology Research Center, and Executive Director of
Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd; Member of the Party Committee and Deputy General Manager of
Beijing Shougang Co., Ltd., Director of Silicon Steel Engineering Technology Research Center, and Executive Director of
Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd; Member of the Party Committee and Deputy General Manager of
Beijing Shougang Co., Ltd., Director of Silicon Steel Engineering Technology Research Center, and Chairman of Shougang Zhixin
Qian'an Electromagnetic Materials Co., Ltd; Member of the Party Committee and Deputy General Manager of Beijing Shougang
Co., Ltd., Deputy Secretary and General Manager of the Party Committee of the Marketing Center, and Chairman of Shougang
Zhixin Qian'an Electromagnetic Materials Co., Ltd; Member of the Party Committee and Deputy General Manager of Beijing
Shougang Co., Ltd., Deputy Secretary and General Manager of the Party Committee of the Marketing Center, Chairman of
Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd., Executive Director and General Manager of Beijing Shougang Steel
Trade Investment Management Co., Ltd., and Director of Shougang Jingtang Steel United Co., Ltd. Currently serving as a member
of the Party Committee and Deputy General Manager of Beijing Shougang Co., Ltd., Deputy Secretary and General Manager of the
Party Committee of the Marketing Center, Executive Director and General Manager of Beijing Shougang Steel Trade Investment
Management Co., Ltd., and Director of Shougang Jingtang Steel United Co., Ltd.
3. Liu Tonghe: The chief accountant of the Company, university degree, senior accountant. Formerly served as the Financing
Administrator of the Finance Department of Shougang Corporation, the Chief Engineer and Deputy Director of the Finance
Department of Shougang Corporation (New Steel Company), the Director of Fund Management (Deputy Director) of the Finance
Department of Shougang Corporation, the Director of Fund Management of the Finance Department of Shougang Group Co., Ltd.,
the Deputy General Manager of Shougang Group Finance Co., Ltd., and the Secretary and Deputy General Manager of the Party
Branch of Shougang Group Finance Co., Ltd. Current Chief Accountant of Beijing Shougang Co., Ltd.
4. Xie Tianwei: The deputy general manager of the Company, a senior engineer with master's degree of Management. The major
employment history of Mr. Xie is as follows: He used to be an intern of Shougang Medium thick Plate Factory, a member of
Shougang 2160 preparatory Group, chief operation officer (seconded) of Operation Area A, chief operation officer of Operation Area
A, director of production technology Office, assistant director of hot rolling operation Department, Assistant director of Production
Department and deputy director of hot rolling Operation Department of Shougang Relocated Steel Company, Vice Minister of hot
rolling Operation Department, Vice Minister of Production Department, Vice Minister of Manufacturing Department, Vice Minister
of Manufacturing Department and Vice Minister of System Innovation Department, Vice Minister of Manufacturing Department and
Director of Contract Planning Room of Marketing Center of Beijing Shougang Co., Ltd., Assistant to general manager of Marketing
Center of Beijing Shougang Co., Ltd., director (director) of Contract Planning Office of Marketing Management Department, Deputy
Director of Manufacturing Department of Beijing Shougang Co., Ltd. Deputy General manager of Beijing Shougang Co., Ltd.
35
Beijing Shougang Co. Ltd Annual Report 2023
5. Wang Kai: The deputy general manager of the Company, a senior engineer with master's degree of Management. The major
employment history of Mr. Wang is as follows: He used to be deputy foreman of 1# blast furnace, deputy foreman of 2# blast furnace,
chief foreman of 2# blast furnace, technician of 2# blast furnace, deputy foreman of 2# blast furnace operation area, chief operator of
1# blast furnace operation area (one-year probation), chief operator of 1# blast furnace operation area, assistant minister (temporary
vice minister) and deputy minister (in charge of work) of Iron Making Division of Shouqin Company. Deputy Minister, Deputy
minister (in charge of work) and minister of the Iron making Operation Department of Shougang Jingtang Co., assistant to the
general manager and head of the Iron making Operation Department of Jingtang Co.. Deputy General manager of Beijing Shougang
Co., Ltd.
6. Qiao Yufei: Secretary of the Board of Directors. Master's degree. Formerly served as Senior Manager and Vice President of the
Investment Banking Committee and Equity Investment Department of CITIC Securities Co., Ltd; Senior Vice President of China
Minsheng Financial Investment Department; General Manager of Post Investment Management and Service Department of
Shougang Fund Co., Ltd., Director and General Manager of Beijing Shouxi Investment Management Co., Ltd., concurrently serving
as a supervisor of Beijing Automotive Co., Ltd., director of Shouhui Industrial Financial Services Group Co., Ltd., director of Beijing
Chuangye Industrial Operation Management Co., Ltd., supervisor of Beijing Shougang Green Festival Entrepreneurship Investment
Co., Ltd., and senior manager of the Board Secretary Office of Beijing Shougang Co., Ltd. The current Secretary of the Board of
Directors of Beijing Shougang Co., Ltd.
Employment at the shareholder of the Company
√Applicable □Not applicable
Start date of End date Received remuneration
Name Entity Position in shareholder company
term of term from other entity (Y/N)
Deputy secretary of the Party
September
Qiu Yinfu Shougang Group Co., Ltd. Committee, Director and General Y
2023
Manager
Executive director of the office of the
Sun Yi Shougang Group Co., Ltd. January 2021 Y
board of supervisors
January
Guo Liyan Shougang Group Co., Ltd. Director of audit department June 2017 Y
2024
Capital Operation Department,
China Baowu Steel Group
Li Jiantao Director of capital Operation of March 2021 Y
Corporation Ltd.
Industry and Finance Center
Beijing Jingguorui Equity
November
Chang Hiyu Investment Fund Investment director Y
2011
Management Co., Ltd.
Position in other entity
□ Applicable √ Not applicable
Notes for any punishment from securities review and management authorities, on resigned or current directors, supervisors, and
senior managers within the three years
□ Applicable √ Not applicable
IIⅠ. Remuneration of directors, supervisors and senior management
Decision making procedure, determination basis and actual payment of remuneration for directors, supervisors and senior managers：
Remuneration for directors: the independent directors of the Company collect the allowance of independent directors, and the
allowance standard of independent directors is determined by the general meeting of shareholders; the director who concurrently
serves as the general manager does not collect the remuneration of directors; director Qiu Yinfu collects remuneration in Jingtang Co.,
which is not the director remuneration; other directors do not collect remuneration from the Company.
Remuneration for supervisors: employee representative supervisors collect remuneration from the Company, while other supervisors
do not collect remuneration from the Company. The employee representative supervisor shall be remunerated according to the
position of non-supervisor in the Company.
Remuneration of senior management personnel: The remuneration of senior management personnel such as the general manager shall
be formulated by the Remuneration and Assessment Committee of the Board of Directors of the company in accordance with
regulations, and the "Annual General Manager Remuneration Assessment and Allocation Method" shall be formulated. Assessment
and allocation opinions shall be proposed based on the completion of annual tasks and division of responsibilities, and shall be
submitted to the annual board of directors for review and approval before settling and realizing all performance-based annual salaries.
The specific remuneration situation for the year 2023 is shown in the table below.
Remuneration of directors, supervisors and senior management during the reporting period
Unit：RMB 0,000
Whether to get
Total pretax
remuneration
remuneration
Name Gender Age Position Status from related
received from
parties of the
the company
company
Qiu Yinfu Male 56 Chairman Incumbent 0 Yes
Zhu Guosen Male 46 Director Incumbent 0 No
Zeng Li Male 52 Director Incumbent 75.77 No
Li Jiantao Male 45 Director Incumbent 0 Yes
36
Beijing Shougang Co. Ltd Annual Report 2023
Dndependent
Gu Wenxian Male 62 Incumbent 12 No
director
Dndependent
Yu Xingxi Male 65 Incumbent 12 No
director
Dndependent
Liu Shen Male 48 Incumbent 12 No
director
Dndependent
Peng Feng Male 44 Incumbent 0 No
director
Chairman of
Sun Yi Male 58 supervisory Incumbent 0 Yes
board
Guo Liyan Female 48 Supervisor Incumbent 0 Yes
Chang Haiyu Female 39 Supervisor Incumbent 0 Yes
Employee
Wang Xingtao Male 45 representative Incumbent 27.91 No
supervisor
Employee
Qu Erlong Male 42 representative Incumbent 22.58 No
supervisor
General
Zhu Guosen Male 46 Incumbent 17.99 No
Manager
Vice general
Sun Maolin Male 47 Incumbent 64.97 No
manager
Chief
Liu Tonghe Male 43 Incumbent 14.72 No
Accountant
Vice general
Xie Tianwei Male 42 Incumbent 59.17 No
manager
Vice general
Wang Kai Male 41 Incumbent 54.01 No
manager
Secretary of the
Qiao Yufei Female 35 Board of Incumbent 13.72 No
Directors
Zhao Minge Male 57 Chairman Resignation 0 Yes
Director/
Liu Jianhui Male 59 General Resignation 53.03 Yes
Manager
Independent
Ye Lin Male 60 Resignation 12.00 No
director
Zhang Vice general
Male 47 Resignation 48.73 Yes
Binglong manager
Chief
Li Baizheng Male 58 Resignation 48.32 Yes
Accountant
Vice general
Li Jingchao Male 57 Resignation 38.35 Yes
manager
Deputy General
Manager and
Chen Yi Male 56 Secretary of the Resignation 58.46 Yes
Board of
Directors
Total -- -- -- -- 645.73 --
Explanation of other situations
□ Applicable √ Not applicable
VI. Performance of Directors during the reporting period
1. Board meetings during the reporting period
Meeting Convening date Disclosure date Resolutions of meeting
The first extraordinary meeting of Detailed information can be found in the company's
the board of directors for the year 2023/3/10 2023/3/11 announcement on the date of disclosure of the meeting
2023 resolution
Detailed information can be found in the company's
The Second Board Meeting of the
2023/4/19 2023/4/21 announcement on the date of disclosure of the meeting
Eighth Board of Directors
resolution
The Second Extraordinary Meeting Detailed information can be found in the company's
of the Board of Directors for the 2023/6/9 2023/6/10 announcement on the date of disclosure of the meeting
Year 2023 resolution
The Third Extraordinary Meeting 2023/8/10 2023/8/11 Detailed information can be found in the company's
37
Beijing Shougang Co. Ltd Annual Report 2023
of the Board of Directors for the announcement on the date of disclosure of the meeting
Year 2023 resolution
The Fourth Extraordinary Meeting Detailed information can be found in the company's
of the Board of Directors for the 2023/8/18 2023/8/19 announcement on the date of disclosure of the meeting
Year 2023 resolution
Detailed information can be found in the company's
The Third Meeting of the Eighth
2023/9/12 2023/9/13 announcement on the date of disclosure of the meeting
Board of Directors
resolution
The Fifth Extraordinary Meeting of Detailed information can be found in the company's
the Board of Directors for the Year 2023/9/28 2023/9/29 announcement on the date of disclosure of the meeting
2023 resolution
Detailed information can be found in the company's
The 6th Extraordinary Meeting of
2023/10/26 2023/10/27 announcement on the date of disclosure of the meeting
the Board of Directors in 2023
resolution
Detailed information can be found in the company's
The 7th Extraordinary Meeting of
2023/12/12 2023/12/13 announcement on the date of disclosure of the meeting
the Board of Directors in 2023
resolution
Detailed information can be found in the company's
The Fourth Meeting of the Eighth
2023/12/28 2023/12/29 announcement on the date of disclosure of the meeting
Board of Directors
resolution
2. Attendance of Directors at Board meetings and general meetings
Attendance of Directors at Board meetings and general meetings
Number of
attendance Attendance at Absent from
Attendance at Attendance at Attendance at
Name of required for Board meetings Absence from Board meetings
Board meetings Board meetings general
Directors Board meetings by Board meetings twice in a row
in person by proxy meetings
during the communication (in person)
reporting period
Qiu Yinfu 1 1 0 0 0 否 1
Zhu Guosen 4 1 3 0 0 否 2
Zeng Li 10 3 7 0 0 否 3
Li Jiantao 10 3 7 0 0 否 2
Gu Wenxian 10 2 7 1 0 否 0
Yu Xingxi 10 3 7 0 0 否 2
Liu Shen 10 3 7 0 0 否 0
Peng Feng 10 3 7 0 0 否 0
3. Objections from Directors on related issues of the Company
Whether the directors raise any objection to the relevant matters of the Company
□ Yes √ No
During the reporting period, the directors did not raise any objection to the relevant matters of the Company.
4. Other details about the performance of duties by Directors
Whether the directors' suggestions on the Company have been adopted
√ Yes □ No
Explanation on the adoption or non-adoption with related suggestions from the directors
□ Applicable √ Not applicable
VII. Special committees under the board of directors during the reporting period
Number of
Name of the Convening Important opinion Other performance Details of
Member meeting Details of the meeting
committee date and advice of duty objection (if any)
convened
Composed by 5
Strategic and Risk directors,
Management including 2 0 N/A N/A N/A
Committee independent
directors.
Minutes of Independent
communication between directors express
Composed by 3 Agreed to submit
February 28, the CPA and the audit independent
Audit Committee independent 1 to the Board for
2023 committee (independent opinions in
directors. review
director) before the audit accordance with
entry regulations
38
Beijing Shougang Co. Ltd Annual Report 2023
Communication letters
with independent
directors and the audit
Independent
committee of the board of
directors express
directors regarding the Agreed to submit
March 31, independent
issuance of preliminary to the Board for
2023 opinions in
audit opinions by the review
accordance with
annual audit certified
regulations
public accountant on the
company's 2022 financial
settlement report
Independent
Proposal on the general
directors express
Remuneration and Composed by 3 manager's salary cashing Agreed to submit
March 31, independent
Assessment independent 1 in 2022and the salary and to the Board for
2023 opinions in
Committee directors. assessment distribution review
accordance with
method in 2023
regulations
Independent
directors express
Composed by 3
Nomination independent
independent 0
Committee opinions in
directors
accordance with
regulations
VIII. Performance of duties by the supervisory committee
Whether the board of supervisors found any risks in the company during the supervision activities during the reporting period
□ Yes √ No
None of those issues under the supervision was objected by the supervisory committee during the reporting period.
IX. Personnel of the Company
1. Number of employees, professional composition and education background
Number of employees in the parent company 6,078
Number of employees in the main subsidiary 12,148
Total number of employees 18,226
Total number of employees receiving salary in the current period 18,226
Number of retired employees to be borne by parent company and main
1,388
subsidiary
Professional composition
Professional composition category Number of professional composition
Production 12,351
Salesman 672
Technician 2,242
Finance 288
Administrative 2,245
Services and other 428
Total 18,226
Education background
Type Quantity
Master degree or above 1,631
Bachelor's degree 7,935
College 5,573
Vocational secondary and below 3,087
Total 18,226
2. Remuneration policies
The middle-level employees of the company implement the annual salary system, and the annual salary structure includes three parts:
basic annual salary, performance annual salary and term incentive. The basic salary is paid monthly. The performance bonus (70% of
annual salary standard) links to the performing duty monthly or annually, and annual assessment and settlement based on the
39
Beijing Shougang Co. Ltd Annual Report 2023
completion of the Business Objective Responsibility Agreement. The term incentive shall be assessed and distributed at the end of
the term in accordance with the provisions of the Term Target Responsibility Agreement, based on the business and production
performance during the term.
The salary system of front-line and blow staff is composed of occupation salary and benefit salary. The occupation salary is
influenced by the attendance, and the benefit salary is distributed as the monthly performance on the duty.
3. Training program
Qianshun Base and Zhixin Co. focus on the national and Beijing vocational skills improvement action plan, combined with the
overall requirements of employee team construction, with quality improvement, ability cultivation, and talent appreciation as the core,
adhering to the combination of theory and practice, learning and summary, to establish a "long-distance" development system for the
full life cycle of high potential talents. According to the positioning needs of different levels of talents, such as training reserves,
backbone, core, key, and strategy, design five levels of talent development and training projects, including "waves, sailing, sailing,
piloting, and navigation", to form a continuous and progressive map of high potential talent cultivation and development. This is
continuously promoted in stages and levels, and a series of talent development projects are formulated based on the characteristics
and growth elements of talent abilities at different stages. The talent training implementation project effectively achieves unified
guidance for the cultivation of high potential talents in three talent sequences, accelerating talent growth. Throughout the year, we
organized and completed 193 key training projects at all levels, achieving full coverage of three talent teams: business management,
professional technology, and skill operation. This provides strong support for building a team of employees with both moral integrity
and excellent quality, continuously enhancing the cohesion and high-quality development of the enterprise.
Jingtang Co. focuses on improving the quality and ability of the staff, continuously expanding its growth and talent platform.
Establish a correct orientation for selecting and employing personnel, focus on practical training in undertaking urgent, difficult, and
heavy tasks, hold leadership lecture halls and grassroots leadership rotation classes, select pilot units to promote competition for
leadership positions, and strengthen the construction of management personnel teams. Utilize the advantages of school enterprise
joint training, hold the second high-end composite technical talent training course, and enhance the abilities of professional and
technical personnel. Continuously carry out skill competitions and graded training for team leaders to enhance the operational skills
of employees in their positions. Establish a differentiated training path for graduates, implement a "blue and blue" consistent training
plan, and strengthen the cultivation of reserve forces.
4. Outsourcing of labor source
□ Applicable √ Not applicable
X. Porposal for profit distribution and transfer of capital reserve to share capital
Formulation, Implementation and Adjustment of common stock Profit Distribution Policy Especially Cash Dividend policy during
the reporting period
√Applicable □Not applicable
Special description on cash dividend policy
Whether it meets the requirements of the Article of Association or the Resolution of the General Meeting (Y/N): Y
Whether the bonus standards and proportion is clear and well-defined (Y/N): Y
Whether has a completed relevant decision-making procedures and mechanism (Y/N): Y
Whether independent directors fulfill duties and play a due role (Y/N): Y
If the company does not distribute cash dividends, specific reasons should be disclosed, as well as the measures to be taken
N/A
next to enhance investor returns:
Minority shareholders whether has opportunity of full expression and appeals, the legal interest of the minority are being
Y
protected adequately (Y/N):
As for the adjustment and change of cash bonus policy, the condition and procedures whether meets regulations and
N/A
transparent (Y/N):
The Company was profitable during the reporting period and the Parent Company’s profit available for distribution to shareholders
was positive, but no cash dividend distribution plan was proposed
□ Applicable √ Not applicable
Profit distribution and conversion of capital reserves into share capital during the reporting period
√ Applicable □ Not applicable
Number of bonus shares per 10 shares 0
Dividend payout per 10 shares (RMB yuan) (including tax) 0.3
Number of shares converted for every 10 shares 0
Distribution plan's share capital base (shares) 7,794,611,605
Cash dividends (RMB yuan) (including tax) 233,838,348.15
Cash dividend amount in other ways (such as repurchase of
0.00
shares) (RMB yuan)
40
Beijing Shougang Co. Ltd Annual Report 2023
Total cash dividends (including other methods) (RMB yuan) 233,838,348.15
Distributable profit (RMB yuan) 317,765,555.82
The proportion of total cash dividends (including other
74%
methods) to total profit distribution
Current cash dividend situation
Others
Detailed explanation of profit distribution or capital reserve conversion plan
Not increasing share capital through the conversion of provident fund.
XI. Implementation of the equity incentive plan, employee shareholding plan or other
employee incentive measures of the Company.
√Applicable □Not applicable
1. Equity incentive
According to the "Reply on The Implementation of Equity Incentive Plan for Beijing Shougang Co., Ltd." issued by State-owned
Assets Supervision and Administration Commission of Beijing Municipal People's Government (Jingguozi [2021] No. 140) and the
resolution of the Company's first interim general Meeting of shareholders in 2021, the Company implemented the 2021 restricted
stock Incentive plan. 64,901,800 shares were issued to 386 directors, senior management personnel, core technical personnel and
management backbones. The restricted stock grant date is December 9, 2021, and the restricted stock is booked as of December 23,
2021.
According to the Incentive Plan, if the company's 2022 performance indicators do not meet the performance evaluation conditions at
the company level for the first period of lifting restrictions as stipulated in the Incentive Plan, and 15 incentive targets have
undergone changes due to organizational or personal reasons and no longer meet the incentive conditions, the company needs to
repurchase and cancel 23,418,884 restricted stocks granted to the aforementioned 15 incentive targets that have not yet been lifted
from restrictions; Considering the actual implementation of the employee stock ownership plan by Zhixin Co., and considering that
both the employee stock ownership plan and equity incentives are medium and long-term incentives, the company allows related
personnel of Zhixin Co. to choose to participate in one of the two incentive methods and repurchase 1,838,681 restricted stocks held
by 18 incentive targets (employees of Zhixin Co.) who withdrew from the incentive plan. With the approval of the company's
shareholders meeting, as of December 5, 2023, the company has repurchased and cancelled a total of 25,257,565 shares of the
aforementioned restricted shares.
41
Beijing Shougang Co. Ltd Annual Report 2023
Information on share option scheme provided to directors and senior management during the reporting period
√Applicable □Not applicable
Unit: share
Exercise price
Number of Number of Number of
Number of of the shares Number of Market price at Number of Number of
newly granted Number of shares shares newly granted Grant price of
Restricted shares exercised restricted the end of the restricted shares unlocked
restricted exercisable during exercised restricted restricted Number of restricted shares held at the
Name Position held at the during the shares held at reporting held at the shares during
shares during the reporting during the shares during shares (RMB/ end of the period
beginning of the reporting the end of the period (RMB/ beginning of the the current
the reporting period reporting the reporting share)
period period (RMB/ period share) period period
period d period period
share)
Zeng Li Director 0 0 0 0 0 3.46 290,000 0 0 3.17 194,300
Vice General
Sun Maolin 0 0 0 0 0 3.46 261,000 0 0 3.17 174,870
Manager
Vice General
Xie Tianwei 0 0 0 0 0 3.46 203,300 0 0 3.17 136,310
Manager
Vice General
Wang Kai 0 0 0 0 0 3.46 203,300 0 0 3.17 136,310
Manager
Total -- 0 0 0 0 -- 0 -- 957,600 0 0 -- 641,790
Notes (if any)
42
Beijing Shougang Co. Ltd Annual Report 2023
Evaluation mechanism and incentive of senior management
Evaluation of senior management personnel such as the general manager: The general manager and other senior management
personnel implement an annual salary system consisting of three parts: base salary, performance-based annual salary, and term
incentives. Among them: the base salary ratio is 30%, paid monthly; The performance-based annual salary ratio is 70%, with a
monthly advance payment of 50%. The annual assessment and allocation opinions shall be proposed by the Compensation and
Assessment Committee of the Board of Directors of the company in accordance with regulations, based on the completion of annual
tasks and division of responsibilities in the "Salary Assessment and Allocation Method for General Managers and Senior
Management Personnel". After being reviewed and approved by the annual board meeting, all performance-based annual salaries
shall be settled and fulfilled; The term incentive is determined based on an annual salary standard of 30%, and will be assessed and
fulfilled at the end of the term according to the "Term Target Responsibility Agreement".
2. Implementation of employee stock ownership plan
□ Applicable √ Not applicable
3. Other employee incentive measures
□ Applicable √ Not applicable
XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control system
The Company has established and improved its internal control system, and has revised and improved it in conjunction with actual
operations, fully leveraging its institutional guarantee role. During the reporting period, the company formulated 20 regulations,
including the "ESG Work Management System of Beijing Shougang Co., Ltd." and the "Management and Evaluation System for
Personnel Dispatched to Participating and Holding Enterprises of Beijing Shougang Co., Ltd.", and revised 72 regulations, including
the "Articles of Association of Beijing Shougang Co., Ltd." and the "Work Regulations of the Strategy, Risk, ESG and Compliance
Management Committee of the Board of Directors of Beijing Shougang Co., Ltd."; As of the end of 2023, the company has a total of
495 regulations, including 491 regulations formulated and implemented by the company, and 4 regulations forwarded to the
government and regulatory agencies.
2.Particulars of material deficiencies in internal control detected during the reporting period
□Yes √ No
XIII. The Company’s management and control of subsidiaries during the reporting period
Not applicable
XIV. Self-assessment report on internal control or auditor’s report on internal control
1. Appraisal Report of Internal Control
Disclosure date of full internal control
22 April 2024
evaluation report
Disclosure index of full internal control Beijing Shougang Co., Ltd. 2023 Internal Control Self-Assessment Report, disclosed on
evaluation report CNINFO Website (http://www.cninfo.com.cn/).
Proportion of total assets included in
internal control evaluation report
100.00%
accounting for the total assets in the
consolidated financial statements
Proportion of operating revenue
included in internal control evaluation
100.00%
report accounting for operating revenue
in the consolidated financial statements
Defect identification criteria
Type Financial Reports Non-financial reporting
1. Material deficiency: (1) it 1. Material deficiency: there is causing multiple casualties
may or has made the company among employees and citizens, causing serious damage to
unable to achieve all operating the environment, and the situation spiraling out of control;
objectives, resulting in May or has prevented the company from achieving all
business suspension. It is not operational goals, resulting in business suspension, non
an objective reason and has objective reasons, and exceeding the budget by more than
exceeded the budget by more 20% in terms of time, manpower, or cost without
Qualitative criteria than 20% in terms of time, appropriate approval, and exceeding the level of
manpower or cost without importance; May or has already caused significant impact
proper approval, and has on the company, negative news is widely circulated,
exceeded the level of causing significant damage to the reputation of the
importance; (2) The company enterprise, government or regulatory agencies conduct
has financial related fraud, investigations, attracting public attention, and causing
which affects the accuracy of irreparable damage to the reputation of the enterprise;
financial statements. Violating national laws and regulations, facing business
43
Beijing Shougang Co. Ltd Annual Report 2023
2. Significant deficiency: it suspension, legal litigation or economic compensation,
may or has slowed down the which may or have already caused serious social impact,
business operation, or unable being notified or publicly condemned by regulatory
to achieve some business agencies, or even ordered to suspend business for
objectives, or not exceeding rectification.
the budget by 6% - 20% in 2. Significant deficiency: failure to establish a "three major
terms of time, manpower or and one major" decision-making process, or inadequate or
cost for non-objective reasons inadequate implementation of the decision-making
and without proper approval; process, which may or has already had negative impacts;
3. General deficiency: it may May or has seriously affected the health of multiple
or has caused slight impact on employees or citizens, or caused general environmental
business activities, which is damage, which requires external support to be controlled;
not an objective reason and May or has already slowed down business operations,
has exceeded the budget by unable to achieve some business objectives, and not
1% - 5% in terms of time, exceeding the budget by 6% -20% in terms of time,
manpower or cost without manpower, or cost due to objective reasons and without
proper approval. appropriate approval; Negative news may or has already
had a significant impact on the company, spreading in a
certain region and attracting the attention of relevant
stakeholders, such as partners suspending cooperation, low
employee efficiency, and reduced customer loyalty;
Violation of national or regional regulations or industry
norms, facing legal proceedings, economic compensation,
which may or have already caused general social impact,
has attracted the attention of regulatory agencies, and
requires regular rectification.
3. General deficiency: it may or has temporarily affected
the health of employees or citizens; May or has already
caused a slight impact on business activities, exceeding the
budget by 1% -5% in terms of time, manpower, or cost due
to non objective reasons and without appropriate approval;
Negative news may or has already had a slight impact on
the company, spreading within the company or locally, and
will not attract the attention of stakeholders; Violation of
company regulations or conflicts with self established
rules and regulations may have caused minor social impact
and will not attract the attention of regulatory authorities.
1. Material misstatement:
amount of misstatement≥1%
of total assets 1. Material misstatement: amount of direct property
2. Significant misstatement: losses≥RMB 10,000,000
0.5% of total assets≤amount 2. Significant misstatement: RMB 5,000,000≤ amount of
Quantitative criteria
of misstatement < 1% of total direct property losses < RMB 10,000,000
assets 3. General misstatement: RMB 100,000≤amount of
3. General misstatement: property losses < RMB 5,000,000
amount of misstatement <
0.5% of total assets
Number of material defects in financial
0
reports
Number of material defects in
0
non-financial reports
Number of significant defects in
0
financial reports
Number of significant defects in
0
non-financial reports
2.Audit report for internal control
√ Applicable □ Not applicable
Audit opinion on internal control
Shougang Co. has kept the effective internal control over financial reporting in all material matters on 31 December 2023, in
accordance with the “Basic Standards for Internal Control of Enterprises” and other relevant regulations.
44
Beijing Shougang Co. Ltd Annual Report 2023
Disclosure of internal control audit
Disclosed
report
Date of disclosure of the internal
22 April 2024
control audit report
Source for the internal control audit
Searching for: http://www.cninfo.com.cn/.
report
Audit opinion on internal control Standard unqualified opinion
Whether material deficiency over
No
non-financial reporting
Whether non-standard opinions from independent auditors in the audit report on internal control
□ Yes √ No
Whether there is consistent opinion between the audit report on internal control and the self-assessment report on internal control
√ Yes □ No
XV. Rectification of problems found in self-inspection under the special initiative on
corporate governance of the listed company
The Company has no problems found in self-inspection under the special initiative on corporate governance of the listed company.
45
Beijing Shougang Co. Ltd Annual Report 2023
Section V. Environment and Social Responsibility
I. Major environmental protection matters
Whether the listed company and its subsidiaries belong to the key pollutant discharge units announced by the environmental
protection department
√ Yes □ No
1. Environmental protection related policies and industry standards
The policies and industry standards related to environmental protection implemented by the Company and its subsidiaries mainly
include: Environmental Protection Law of the People's Republic of China, Cleaner Production Promotion Law of the People's
Republic of China, Air Pollution Prevention and Control Law of the People's Republic of China, Water Pollution Prevention and
Control Law of the People's Republic of China, Environmental Pollution Prevention and Control Law of the People's Republic of
China by Solid Waste, Noise Pollution Prevention and Control Law of the People's Republic of China, Soil Pollution Prevention and
Control Law, Environmental Impact Assessment Law of the People's Republic of China, Regulations on the Administration of
Pollutant Emission Permits, Regulations of Hebei Province on Ecological and Environmental Protection, Ultra-Low Emission
Standards of Air Pollutants for the Iron and Steel Industry, Regulations of Tangshan City on Ecological and Environmental Protection,
etc.
2. Administrative license for environmental protection
During the reporting period, Qiangang Co. has completed environmental protection acceptance work for three projects, including the
15MWCCPP project of the Ministry of Energy and the renovation project of the steel slag pressing ball line drying equipment. It has
organized and carried out environmental impact assessment procedures for 14 construction projects, including the new supporting
white ash kiln project and the thawing warehouse project, to ensure that environmental protection projects comply with laws and
regulations. In October 2023, Qiangang Co. obtained a new version of the pollution discharge permit issued by the Tangshan
Ecological Environment Bureau, which is valid until October 2028.
Jingtang Co. adheres to the principle of attaching equal importance to production development and environmental protection, so it
carries out environmental impact assessment of construction projects strictly in accordance with the Environmental Impact
Assessment Law of the People's Republic of China. In the process of project implementation, Jingtang Co. carries out construction
strictly in accordance with the EIA approval, and all construction projects are supporting the construction of environmental protection
facilities, environmental protection approval procedures are complete, which meets the requirements of "three simultaneous"
management of environmental protection. In August 2017, Jingtang Co. obtained a new version of the sewage discharge permit
issued by Tangshan Environmental Protection Bureau, which enabled the construction of the second-phase one-step project to
proceed smoothly. In April 2019, Jingtang Co. completed the change of sewage discharge permit and obtained relevant certificates,
and incorporated the sewage discharge outlet of the second-phase one-step project into standardized management. In August 2020,
Jingtang Co. completed the extension of the sewage discharge permit, with the validity period extended to August 2025. In February
and May 2023, and January 2024, the re application for the pollution discharge permit was completed, and the validity period was
extended to January 2029.
In strict accordance with the Environmental Impact Assessment Law of the People's Republic of China, Regulations on Pollutant
Emission Permit Management and other laws and regulations, according to the requirements of pollutant emission permit and EIA
management, Zhixin Co. continues to improve the post- emission permit management work, and continues to do a good job in EIA
and acceptance. Apply for a new pollution discharge permit in February 2023, which is valid until February 2028; Complete the
environmental acceptance procedures for the new energy vehicle electrical steel project of Shougang Zhixin Qian'an Electromagnetic
Materials Co., Ltd. in March 2023, and the environmental acceptance procedures for the wastewater station environmental capacity
improvement project of Zhixin Co. in April 2023; Apply for a new pollution discharge permit in October 2023, which is valid until
October 2028. In August 2023, the approval procedures for the environmental impact report form of the high-end silicon steel heat
treatment project (re submitted) of Zhixin Co. were completed.
In October 2017, Cold-R Co. obtained the first pollutant emission permit for key enterprises in Shunyi District, Beijing. In September
2020, Cold-R Co. submitted an application for the renewal of the sewage permit in accordance with relevant regulations, and in
October 2022, the application passed the government review, which extended the validity of the permit to October 2025.
46
Beijing Shougang Co. Ltd Annual Report 2023
3. Industrial discharge standards and details of the discharge of pollutants involved in production and business activities
Name of Company or Types of major pollutants and Names of major pollutants and Total approved Emissions exceed the
Way of Discharge No. of drains Distribution of emission drains Emission concentration Implemented pollutant emission standards Total emissions (tons)
Subsidiary characteristic contaminants characteristic contaminants emissions (tons) standard
Qiangang Co. Water pollutant COD (Chemical Oxygen Demand) Direct 1 1# wastewater discharge port 4.131mg/L 50mg/L 1.5866 648.990 No
Ammonia
Qiangang Co. Water pollutant Direct 1 1# wastewater discharge port 0.185mg/L 5mg/L 0.0689 64.899 No
Nitrogen
Sintering, pelletizing <
Power station boiler chimney, sintering machine
10.87mg/m blast furnace hot Sintering, pelletizing < 35mg/m blast furnace
head flue gas outlet, pellet roasting flue gas outlet,
blast furnace, rolling steel hot blast furnace, rolling steel heating furnace,
Qiangang Co. Air pollutants Sulfur Dioxide Organized 28 CCPP combustion exhaust gas, blast furnace hot 932.52 1465.98 No
heating furnace, lime kiln < lime kiln < 50mg/m power generation <
blast furnace outlet, steel rolling heating furnace
28.3mg/m power generation < 35mg/m
outlet, white ash kiln roof, sleeve kiln roof
26.35mg/m
Sintering, pelletizing <
Power station boiler chimney, sintering machine
30.9mg/m blast furnace hot Sintering, pelletizing < 50mg/m blast furnace
head flue gas outlet, pellet roasting flue gas outlet,
blast furnace, rolling steel hot blast furnace, rolling steel heating furnace,
Qiangang Co. Air pollutants Nitrogen Oxides Organized 28 CCPP combustion exhaust gas, blast furnace hot 1027.14 3032.405 No
heating furnace, lime kiln < lime kiln < 150mg/m power generation <
blast furnace outlet, steel rolling heating furnace
37.76mg/m power generation < 100mg/m
outlet, white ash kiln roof, sleeve kiln roof
34.79mg/m
Power station boiler chimney, sintering machine
head flue gas outlet, pellet roasting flue gas outlet, Sintering, pelleting <
blast furnace iron field dust removal, blast furnace 3.42mg/m blast furnace hot Sintering, pelletizing < 10mg/m blast furnace
silo dust removal, steelmaking converter secondary blast furnace, rolling steel hot blast furnace, rolling steel heating furnace,
Qiangang Co. Air pollutants Particulate Matter Organized 124 1655.93 2302.92902 No
dust removal, converter primary dust removal, heating furnace, lime kiln, other lime kiln < 10mg/m power generation <
CCPP combustion exhaust gas, hot rolling heating environment < 3.26mg/m 5mg/m
furnace exhaust gas, environmental dust removal, power generation < 2.55mg/m
material transfer exhaust gas
Boiler chimney of power station of thermoelectric
branch plant, flue gas outlet of sintering machine
head, flue gas outlet of pellet roasting, primary flue
gas dust removal 1#, primary flue gas dust removal
2#, secondary flue gas dust removal 2#, secondary
Sintering, pelletizing <
flue gas dust removal on silo of 1# and 2# blast
15mg/m blast furnace hot blast Sintering, pelletizing < 35mg/m blast furnace
furnace, secondary dust removal from 1#
furnace, rolling steel heating hot blast furnace, rolling steel heating furnace,
decarbonization converter, secondary dust removal
Jingtang Co. Air pollutants Sulfur Dioxide Organized 50 furnace, lime kiln < 25mg/m lime kiln < 50mg/m coke oven flue gas < 1089 3031 No
from 2# decarbonization converter, coke oven
coke oven flue gas < 15mg/m 30mg/m coal-fired power generation <
chimney 3 emissions Port, coke pushing machine
coal-fired power generation < 35mg/m
ground station discharge port, coke dust removal 3
10mg/m
discharge port, dry extinguishing dust removal 3
discharge port, dry extinguishing dust removal 4
discharge port, 7# converter secondary dust
removal, CCPP combustion exhaust gas, 6#
converter secondary dust removal, etc
Boiler chimney of power station of thermoelectric
branch plant, flue gas outlet of sintering machine
head, flue gas outlet of pellet roasting, primary flue
gas dust removal 1#, primary flue gas dust removal
2#, secondary flue gas dust removal 2#, secondary
Sintering < 25mg/m pelletizing
flue gas dust removal on silo of 1# and 2# blast
< 30mg/m blast furnace hot Sintering, pelletizing < 50mg/m blast furnace
furnace, secondary dust removal from 1#
blast furnace, rolling steel hot blast furnace, rolling steel heating furnace,
decarbonization converter, secondary dust removal
Jingtang Co. Air pollutants Nitrogen Oxides Organized 46 heating furnace, lime kiln < lime kiln < 150mg/m coke oven flue gas < 2735 6110 No
from 2# decarbonization converter, coke oven
50mg/m coke oven flue gas < 130mg/m coal-fired power generation <
chimney 3 emissions Port, coke pushing machine
45mg/m coal-fired power 50mg/m
ground station discharge port, coke dust removal 3
generation < 30mg/m
discharge port, dry extinguishing dust removal 3
discharge port, dry extinguishing dust removal 4
discharge port, 7# converter secondary dust
removal, CCPP combustion exhaust gas, 6#
converter secondary dust removal, etc
47
Beijing Shougang Co. Ltd Annual Report 2023
Name of Company or Types of major pollutants and Names of major pollutants and Total approved Emissions exceed the
Way of Discharge No. of drains Distribution of emission drains Emission concentration Implemented pollutant emission standards Total emissions (tons)
Subsidiary characteristic contaminants characteristic contaminants emissions (tons) standard
Boiler chimney of power station of thermoelectric
branch plant, flue gas outlet of sintering machine
head, flue gas outlet of pellet roasting, primary flue
gas dust removal 1#, primary flue gas dust removal
2#, secondary flue gas dust removal 2#, secondary
flue gas dust removal on silo of 1# and 2# blast Sintering, pelletizing < 5mg/m
Sintering, pelletizing < 10mg/m blast furnace
furnace, secondary dust removal from 1# blast furnace hot blast furnace,
hot blast furnace, rolling steel heating furnace,
decarbonization converter, secondary dust removal rolling steel heating furnace,
Jingtang Co. Air pollutants Particulate Matter Organized 219 lime kiln < 10mg/m coke oven flue gas < 3541 3969 No
from 2# decarbonization converter, coke oven lime kiln < 8mg/m coke oven
10mg/m coal-fired power generation <
chimney 3 emissions Port, coke pushing machine flue gas < 8mg/m coal-fired
10mg/m
ground station discharge port, coke dust removal 3 power generation < 5mg/m
discharge port, dry extinguishing dust removal 3
discharge port, dry extinguishing dust removal 4
discharge port, 7# converter secondary dust
removal, CCPP combustion exhaust gas, 6#
converter secondary dust removal, etc
Continuous annealing furnace, regular annealing
Zhixin Co. Air pollutants Sulfur Dioxide Organized 50 furnace, decarbonization annealing furnace, ring <30mg/m3 30mg/m3 5.53 53.7 No
furnace, hot drawing furnace
Continuous annealing furnace, regular annealing
Zhixin Co. Air pollutants Nitrogen Oxides Organized 50 furnace, decarbonization annealing furnace, ring <100mg/m3 100mg/m3 42.375 164.118 No
furnace, hot drawing furnace
Acid regeneration, continuous annealing furnace, 3
Acid regeneration < 30 mg/m , Heat treatment furnace, pull straightening
constant annealing furnace, decarbonization
Zhixin Co. Air pollutants Particulate Matter Organized 69 heat treatment furnace, score < machine, finishing and shot blasting: 10 20.34 32.5 No
annealing furnace, ring furnace, hot drawing
10 mg/m3 mg/m3, acid regeneration: 30 mg/m3
furnace, scoring
3
Cold-R Co. Water pollutant COD Organized 1 Wastewater stations 1.3891-24.1182 mg/m3 30mg/m 13.796 67.5 No
Ammonia
Cold-R Co. Water pollutant Organized 1 Wastewater stations 0.01304-0.861182mg/m3 1.5(2.5) mg/m3 0.157 3.937 No
Nitrogen
Continuous annealing furnace, 1 # galvanized
Continuous annealing furnace, 1 # galvanized
annealing furnace, 2 # galvanized annealing
annealing furnace, 2 # galvanized annealing
furnace, acid regeneration calcination furnace,
Cold-R Co. Air pollutants Sulfur Dioxide Organized 8 furnace, acid regeneration calcination furnace, 3 mg/m3 3.8646 18 No
hydrogen production conversion furnace: 20
hydrogen production conversion furnace, 1 # boiler
mg/m3;
room, 2 # boiler room, 3 # boiler room
1 #, 2 #, and 3 # boiler rooms: 10 mg/m3
Continuous annealing furnace, 1
# galvanized annealing furnace,
2 # galvanized annealing Continuous annealing furnace, 1 # galvanized
Continuous annealing furnace, 1 # galvanized
furnace: 0.02-99.31 mg/m3; annealing furnace, 2 # galvanized annealing
annealing furnace, 2 # galvanized annealing
Acid regeneration furnace: furnace, acid regeneration calcination furnace,
Cold-R Co. Air pollutants Nitrogen Oxides Organized 8 furnace, acid regeneration calcination furnace, 59.603 99.587 No
35-48 mg/m3; 2 # boiler room: 1 hydrogen production conversion furnace: 100
hydrogen production conversion furnace, 1 # boiler
# boiler room, 3 # boiler room: mg/m3;
room, 2 # boiler room, 3 # boiler room
0.004-78.055 mg/m3; Hydrogen 1 #, 2 #, and 3 # boiler rooms: 80 mg/m3
production conversion furnace
26-33mg/m3
Exhaust gas from straightening
machine:<2.4mg/m3;
Continuous annealing furnace, 1 Waste gas from straightening machine,
# galvanized annealing furnace, continuous annealing furnace, 1 # galvanized
Continuous annealing furnace, 1 # galvanized
2 # galvanized annealing annealing furnace, 2 # galvanized annealing
annealing furnace, 2 # galvanized annealing
furnace, acid regeneration furnace, acid regeneration and calcination
Cold-R Co. Air pollutants Particulate Matter Organized 10 furnace, acid regeneration calcination furnace, 18.722 18.75 No
calcination furnace, hydrogen furnace, hydrogen production conversion
hydrogen production conversion furnace, 1 # boiler
production conversion furnace, waste acid regeneration iron oxide
room, 2 # boiler room, 3 # boiler room
furnace<4.8mg/m3; Waste acid powder bin: 10 mg/m3; 1 #, 2 #, and 3 # boiler
regeneration iron oxide powder rooms: 5 mg/m3
silo<2.3 mg/m3; 1 #, 2 #, and 3
# boiler rooms:<4.979mg/m3
48
Beijing Shougang Co. Ltd Annual Report 2023
4. Treatment of pollutants
Each production process of Qiangang Co. is equipped with perfect environmental protection facilities, which will be regularly
monitored by qualified testing departments. The test results prove that all dust removal facilities achieve ultra-low emission and the
emission concentration of bag dust collector reaches less than 10 mg/m The key pollution sources of Qiangang Co. are equipped
with 56 sets of online monitoring systems, including 1 set of online monitoring system for water pollution, which are all connected
with the ecological environment department. The online monitoring system is compared and monitored quarterly by a qualified
monitoring company, which ensures that the data is true and reliable. Qiangang Co. attaches great importance to saving water
resources and reducing wastewater discharge, so it has invested in the construction of two sewage treatment plants, and the
construction of deep water desalting station, which adopts the international advanced membrane treatment process, can all the
wastewater generated in the production process after treatment and recycling, so the water recycling rate of Qiangang Co. reaches
98.4%.
Jingtang Co. has desulfurization denitrification and other waste gas treatment facilities, which can be highly efficient treatment of all
kinds of waste gas, but also built complete dust removal facilities, the measures using bag dust removal, plastic burning plate dust
removal, electric dust removal and other ways to remove particulate matter; Coke oven flue gas is removed by moving bed calcium
desulfurization +SCR denitration process. The sintering and pellet were removed by circulating fluidized bed desulfurization and
SCR denitration process. Desulfurization of self-built power plant adopts seawater desulfurization +SCR denitration process to
remove, and dense coherent tower desulfurization +SCR denitration process to blast furnace hot blast furnace. Jingtang Co. has
complete wastewater treatment facilities, including coking phenol cyanide sewage treatment system, continuous casting wastewater
treatment system, hot rolling, cold rolling, medium thickness plate, steel rolling wastewater treatment system and comprehensive
sewage treatment station, etc. At the same time, the production wastewater generated by steelmaking and other processes is treated
into the comprehensive sewage treatment station for treatment, so as to achieve coupling zero discharge of wastewater. Jingtang Co.
has complete solid waste treatment facilities, including the construction of rotary hearth furnace - zinc resource recycling project,
slag fine grinding cement production line, full solid waste cementitious material production line, etc., to achieve comprehensive
utilization of solid waste. During the reporting period, all the above environmental protection facilities ran well, and all processes in
the whole process reached ultra-low emission standards.
All environmental protection facilities of Zhixin Co. are operating well, and the production line is equipped with waste gas treatment
facilities such as dust removal and denitrification. After regular monitoring by qualified testing departments, particulate matter is
collected through bag dust removal, plastic firing plate dust removal, and other methods. All dust removal facilities achieve ultra-low
emissions, and the concentration of particulate matter emissions reaches 10mg/m Below, 4 sets of online monitoring systems are
equipped and have been connected to the ecological environment department. The online monitoring system is compared and
monitored quarterly by qualified monitoring units to ensure the authenticity and reliability of data. The emission concentrations of
the three pollutants are all at the optimal level, and the emissions are far below the permitted emissions.
During the reporting period, the pollution prevention and control facilities of Cold-R Co. maintained efficient operation, and all
combustion exhaust gas was generated by using clean fuel natural gas through low nitrogen burners, which minimized the
concentration of pollutants. The dust generated in the production of Cold-R Co. is disposed of by coated bag dust collector, and the
filtration effect reaches 99.99%. The wastewater generated by the cold rolling company is treated by physical, chemical, biochemical
and membrane processes and discharged after treatment. The emission concentration of all pollutants of Cold-R Co. maintains the
leading level in China, and the emissions are far lower than the permitted emissions.
5. Environmental self-monitoring programme
According to the Measures for Self-Monitoring and Information Disclosure of State Key Monitoring Enterprises (Trial), Measures
for Supervisory Monitoring and Information Disclosure of Pollution Sources of State Key Monitoring Enterprises (Trial) and other
relevant provisions, Qiangang Co. has established and improved the pollution source monitoring and information disclosure system
and formulated the Pollutant Emission Monitoring Plan for 2023, and strictly implemented it. In 2023, all environmental monitoring
projects were entrusted to qualified third-party institutions for monitoring, and Qiangang Co. actively organized and coordinated
self-monitoring work and completed monthly monitoring tasks, which strengthened the management of online monitoring operation
and maintenance units and achieved 100% annual monitoring completion rate in 2023. Qiangang Co. fully completed the annual
national pollution source monitoring information disclosure work, up to 100%.
The environmental monitoring system of Jingtang Co. consists of automatic monitoring and manual monitoring. The manual
monitoring system is entrusted to a third-party testing institution. The automatic monitoring regularly conducts environmental
monitoring on pollution sources, waste gas, waste water, noise, radioactive sources and other items in the plant according to the
Self-Monitoring Plan of Key Monitoring Enterprises in 2023, and forms monitoring data and reports at the same time. The
monitoring plan for 2023 has been completed, and all environmental control indicators have reached the standard.
Zhixin Co. adheres to green development, strictly observes the bottom line of environmental protection, and fully implements the
main responsibility of enterprise environmental protection. In 2023, Zhixin Co. will achieve zero pollution of environmental
protection, 100% synchronous operation of environmental protection facilities, and 100% smooth passing of environmental
protection inspection. According to relevant laws and regulations, Zhixin Co. formulates self-monitoring plans and strictly
implements them. While entrusting qualified third-party institutions to conduct monitoring, Zhixin Co. also actively organizes
self-monitoring work. In 2023, Zhixin Co. carried out self-monitoring 98 times, reaching the standard rate of 100%.
Cold-R Co. shall formulate its own monitoring plan in accordance with the requirements of laws and regulations and sewage
discharge permit, entrust a qualified third-party organization to monitor pollutants on a daily, monthly and quarterly basis, and upload
the data to the government-designated information disclosure system. The emission targets of pollution sources will all meet the
standards in 2023.
6. Contingency plan
No ecological and environmental emergencies occurred in the Company and its holding subsidiaries in 2023.
In accordance with the Environmental Protection Law of the People's Republic of China and other laws, regulations, rules and
49
Beijing Shougang Co. Ltd Annual Report 2023
normative documents, Qiangang Co. has formulated the Emergency Plan for Environmental Emergencies. On this basis, Qiangang
Co. also formulated three special plans respectively: Atmospheric Special Emergency Plan for Environmental Emergencies, Water
Special Emergency Plan for Environmental Emergencies and Hazardous Waste Special Emergency Plan for Environmental
Emergencies, which further improved the emergency disposal capacity of air pollution, water pollution and hazardous waste
emergencies.
Jingtang Co. identified gas storage cabinets, pipelines, benzene storage tanks, acid storage tanks, liquid ammonia storage tanks and
other dangerous chemicals and toxic and harmful substances production and storage areas as emergency rescue dangerous targets.
According to the requirements of Shougang Jingtang United Iron&Steel Co., Ltd. 's Emergency Treatment Plan for Environmental
Emergencies (Fourth Edition), in 2023, Jingtang Co. carried out 25 emergency drills such as oil leakage emergency drill, oily sludge
leakage emergency drill and radiation accident emergency drill, which ensures that Jingtang Co. can effectively carry out rescue in
accordance with the requirements of the Plan. At the same time, the emergency drills also improve the skills and actual combat
ability of preventing and dealing with sudden environmental pollution accidents.
In accordance with the requirements of laws and regulations, Zhixin Co. has prepared and put on record the Emergency Plan for
Environmental Emergencies, which mainly consists of atmospheric special plan, water special plan, hazardous waste disposal, risk
assessment, emergency resource investigation, on-site disposal plan and other plans. In 2023, 20 drills were organized and completed
around sudden environmental incidents such as acid leakage, liquid ammonia leakage, and gas leakage. Through the drill, Zhixin Co.
found problems and rectifies them in time, which enhanced the company's ability to deal with environmental emergencies.
In accordance with the requirements of laws and regulations, Cold-R Co. has prepared and put on record the Emergency Plan for
Environmental Emergencies. Cold-R Co. organized acid rolling, continuous annealing, galvanizing operation areas, and public
auxiliary areas to carry out contingency plans annually according to the requirements of the plan, through which the problems are
found and rectifies in time so that the ability to deal with environmental emergencies of Cold-R Co. is enhanced.
7. Environmental protection input and environmental protection tax
During the reporting period, Qiangang Co. continues to implement four projects, including flue gas treatment with roasted pellets,
improvement of dust removal system in sintering finished product warehouse, upgrading and renovation of dust removal in hot
rolling section and rolling line, and desulfurization improvement of second blast furnace hot blast furnace, with a total investment of
RMB202 million completed throughout the year. In 2023, Qiangang Company paid an environmental protection tax of RMB8.623
million, with a reduction of RMB4.603 million.
Jingtang Co. has implemented 3 environmental protection deep treatment projects, including the renovation of the 1700 acid
regeneration flue gas purification system, with a total investment of RMB31.43 million completed throughout the year. In 2023,
environmental protection tax of RMB19.4 million was paid, with a reduction of RMB9.09 million.
The total environmental protection investment of Zhixin Co. in 2023 is RMB11.35 million. By increasing environmental governance
facilities to effectively reduce pollutant emissions, the taxable factors for environmental protection tax of Zhixin Co. mainly includes
dust, nitrogen oxides, toluene, chromic acid mist, sulfur dioxide, sulfuric acid mist, smoke, hydrogen chloride, etc. A total of
RMB1.0099 million of environmental protection tax was paid, with a reduction of RMB155,600.
Cold-R Co. actively promoted environmental management and protection work, with an annual investment of RMB52.2864 million.
In 2023, RMB839,500 was paid for environmental protection tax, with a reduction of RMB13,700.
8. Measures taken to reduce its carbon emissions during the reporting period and their effectiveness
√ Applicable □ Not applicable
In order to accelerate the implementation of national industrial policies in enterprises and promote Shougang Co.'s "carbon
management" activities in a scientific and standardized manner, in 2023, Qiangang Co. was strengthened the construction of a
low-carbon management system, actively promoted the implementation of low-carbon action plans, and focued on creating
low-carbon product dedicated lined to meet the carbon reduction needs of key customers. Organized the preparation and official
release of the "Low Carbon Action Plan of Shougang Co." and its implementation plan, sort out and vigorously promote carbon
reduction measures projects, and accelerated the construction of a green and low-carbon development pattern. The company
comprehensively applied carbon reduction technology, focused on creating low-carbon product dedicated lines, organized the trial
production of low-carbon products with a large proportion of converter scrap steel, conducted experiments on blast furnace large
proportion pellets and biomass rich hydrogen injection, and prepared technical reserves for the company's future low-carbon
development. Successfully completed the annual greenhouse gas emission report and verification work. Participated in the
development of multiple low-carbon standards, among which the international standard "Application of Green Electricity
Identification Based on Blockchain" was officially released on December 6th. Successfully shortlisted as a pilot demonstration unit
for carbon management system construction in Hebei Province. Actively respond to customer needs for sustainable and low-carbon
development, and achieve 100% green electricity for key customer products. Actively respond to CBAM, establish a special working
group to conduct research on data accounting rules and key product data accounting, and successfully complete export product
declaration. Organized carbon emission certification and EPD released to establish a good image of green and low-carbon
development for enterprises.
Jingtang Co. focuses on the ultimate goal of long-term carbon reduction and actively promotes the clean development of energy
structure. In 2023, it purchased 355 million kilowatt hours of green electricity, accounting for 18.8% of all externally purchased
electricity. It fulfilled its commitment to provide 100% green electricity to BMW products, completed the targeted cancellation of
26,000 international I-REC green certificates, and orderly promoted and phased implementation of distributed photovoltaic power
generation projects in the factory. Deepen the construction of the LCA system, successfully pass the organizational level carbon
certification of the International Certification Body (SGS), complete the EPD release of hot-rolled steel plates and strips, and
evaluate weather resistant steel and medium thick plate X80 pipeline steel products as provincial-level green products. Automotive
plates have a comprehensive carbon reduction capacity of 40%. In 2023, the 1 # sintering machine and the 5 # converter respectively
won the championship of the 2022 National Key Large Energy consuming Steel Production Equipment Energy Conservation and
Consumption Reduction Competition, maintaining their position as industry energy consumption benchmarks. Jingtang CO. has been
50
Beijing Shougang Co. Ltd Annual Report 2023
listed as one of the first pilot demonstration units for carbon management system construction in Hebei Province. The China
Environmental Monitoring Station has sent a thank-you letter, expressing high recognition for the carbon monitoring pilot work of
Jingtang Co.
Zhixin Co. focuses on the implementation of the "dual carbon" strategy and actively promotes the clean development of energy
structure. Continuously strengthen the construction of carbon management infrastructure, promote the transformation of heat
treatment production line burners and SCR, vigorously promote the green upgrading of low-carbon process flow, and steadily layout
revolutionary deep decarbonization technology research and development; Simultaneously promoting process carbon reduction and
source carbon reduction, actively promoting the use of green electricity and photovoltaic construction. Existing projects will generate
5.2 million Kwh of photovoltaic power in 2023, and a new high-end heat treatment plant of Zhixin Co. is built to install a
photovoltaic power generation system project. Docking with customer carbon reduction needs, solidly promoting the construction of
LCA system, two series of products for new energy vehicles, non oriented electrical steel and oriented electrical steel, have been
evaluated as green design products by the Energy Conservation Department of the Ministry of Industry and Information Technology,
creating a green manufacturing brand image.
Cold-R Co. adheres to the concept of green development and integrates carbon reduction into the whole process of development and
into all links of production and operation. In 2023, an investment of RMB9 million is made to construct a photovoltaic capacity
increase project of 1.9656mwp, with an average annual power generation of 2.1443 million kWh. According to the construction and
operation of thermal power with a coal consumption of 305g/kWh (standard coal), approximately 603 tons of standard coal can be
saved each year, correspondingly reducing the emissions of various atmospheric pollutants such as carbon dioxide, sulfur oxides, and
nitrogen oxides.
9. Administrative penalties imposed due to environmental problems during the reporting period
During the reporting period, neither the Company nor its holding subsidiaries were punished by regulatory authorities in respect of
environmental protection. At the same time, the Company urges the shareholding companies to abide by the Environmental
Protection Law of the People's Republic of China and other laws, regulations, rules and normative documents.
10. Other environmental information that shall be disclosed
On the basis of adhering to the work of environmental protection, Qiangang Co., Jingtang Co., Zhixin Co. and Cold-R Co. regularly
release environmental protection information on the national key monitoring enterprise self monitoring information disclosure
platform in accordance with the requirements of the environmental protection department, and actively accept social supervision.
11. Other environmental protection related information
In order to develop circular economy and low-carbon economy, build resource-saving, environment-friendly and low-carbon oriented
enterprises, and achieve sound and rapid development of the company, the Company started the preparation of environmental
responsibility report at the end of 2016, covering the preparation scope of Qiangang Co., Jingtang Co., Zhixin Co. and Cold-R Co.
and other subsidiaries. In April 2023, the Company's website (http://www.sggf.com.cn) released the 2022 Annual Environmental
Responsibility Report of Beijing Shougang Co., Ltd.
II.Social responsibility
The Company has independently prepared the "2023 Sustainable Development Report" and submitted it for review at the 7th meeting
of the 8th Board of Directors. The specific content is detailed in the company announcement on April 22, 2024.
III. Consolidate and expand the achievements of poverty alleviation and rural revitalization
1. According to the Opinions of the Central Committee of the Communist Party of China on Continuously Selecting the First
Secretary and Work Team for Key Villages, as well as the deployment of the Organization Department of the Beijing Municipal Party
Committee and the Beijing State owned Assets Supervision and Administration Commission, and in combination with the
arrangement of the Organization Department of the Party Committee of Shougang Group, Shougang Co. and Jingtang Co. each
selected one staff member to serve as the First Secretary of Beijing's Collective Economy Weak Villages. In 2023, under the
leadership of the local Party Committee and government, they conscientiously fulfilled their duties and contributed to the
implementation of the rural revitalization strategy.
2. The Company actively fulfills its social responsibilities, expands the achievements of poverty alleviation, implements poverty
alleviation through consumption, and helps rural revitalization. In 2023, the Company purchased RMB3.7088 million of agricultural
materials for poverty alleviation in paired assistance areas.
51
Beijing Shougang Co. Ltd Annual Report 2023
Section VI. Significant Events
I. Implementation of commitment
1.Commitments made by the company's actual controller, shareholders, related parties, acquirers and the company and
other committed parties have been fulfilled during the reporting period and have not been fulfilled by the end of the
reporting period
√ Applicable □ Not applicable
Commitment Commitment Commitment
Commitment Type Contents Implementation
party date term
Implementing.
1.According to the iron and steel industry development plan of
Shougang Group, Shougang Co. will be the only platform for the In December 2021,
development and integration of the iron and steel and upstream iron Shougang Co., Ltd. and
ore resources industry of Shougang Group in China, and eventually Shougang Group signed
achieve the overall listing of Shougang Group's iron and steel and the "Management
upstream iron ore resources business in China Service Agreement
between Shougang
2. As for the other companies of Shougang Group engaged in iron and
Group Co., Ltd. And
Shougang steel production business, if the profits could be achieved for three Refer to Beijing Shougang Co.,
Group Co., consecutive years through optimizing and adjusting the product 27 Dec. 2018 contents of Ltd. On The Affiliated
Ltd. structure and actively implementing national industrial policies and commitment Enterprises of
environmental protection requirements, and the overall situation of the
Shougang Group Co.,
industry does not appear large fluctuation, Shougang Group will
Ltd. ". Shougang Co.,
activate the manners in line with the interests of shareholders of listed
Ltd. provides
companies, including but not limited to acquisition, merger,
management services
reorganization, etc. to invest relevant high-quality assets in Shougang
for a total of 14 target
Co. in accordance with the requirements of securities laws, regulations
enterprises in the steel
and industrial policies, and will complete the investment within 36
sector of Shougang
months after start-up.
Group.
When the market improves in the future, Shougang Mining
Commitment in assets Corporation achieves stable profits for two consecutive years, and the
restructuring overall situation of the industry is not fluctuated greatly, Shougang
Corporation will start the injection of Shougang Mining Corporation
in Shougang Co. and complete it within 36 months. Before Shougang
Mining Corporation joined in Shougang Co., Shougang Group will
Shougang Refer to
urge Shougang Mining Corporation to conduct necessary related party
Group Co., 20 Apr. 2017 contents of Implementing.
transactions with Shougang Co. in accordance with fair and reasonable
Ltd. commitment
market price, strictly conform to the requirements of laws and
regulations, normative documents, the articles of association of
Shougang Co. and related transaction management system, and
perform the corresponding review, approval and information
disclosure procedures for the necessary related transactions between
Shougang Co. and Shougang Mining Corporation.
The company will not damage the independence of Shougang Co. due
to the increase of the proportion of shares held by Shougang Co. after After the
the completion of the reorganization. The company will maintain "the completion of
Shougang five-aspect separation principle", which means assets, personnel, assets
Implementing of the
Group Co., financial affairs, institution and business should be independent of 20 Jul. 2012 reorganization
long-term commitment.
Ltd. Shougang Co., strictly conform to relevant provisions of the CSRC on (completion
the independence of listed companies, not illegally utilize Shougang date: 25 April
Co. to provide guarantees, not illegally occupy the assets of Shougang 2014)
Co. and keep and maintain the independence of Shougang Co.
52
Beijing Shougang Co. Ltd Annual Report 2023
Shougang Group is the largest shareholder and controlling shareholder
of Shougang.
On July 17, 2012, Shougang Group issued the "Letter of Commitment
of Shougang Corporation on Reducing and Standardizing Related
Party Transactions" (i.e. the commitments listed above, hereinafter
referred to as the "original letter of commitment"), and promised that
after the completion of major asset replacement purchase of assets by
issuing shares between Shougang Co., and Shougang Group
[hereinafter referred to as "the previous major asset restructuring
(completed on April 25, 2014)", Shougang Group will take relevant
measures including joining Shougang Mining Company into
Shougang Co., to reduce and standardize related party transactions
with Shougang Co. In order to reduce and standardize the related party
transactions after the major asset replacement and related party
transactions of Shougang Co. and safeguard the legitimate rights and
interests of Shougang Co. and its public shareholders, the company
promises to continue to fulfill the contents of the original commitment
letter after the major asset replacement, and further promises as
follows:
1. The company will perform its obligations as the controlling
During and
Shougang shareholder of Shougang Co. in good faith, try to avoid and reduce the
after the
Group Co., related transactions with Shougang Co. (including the enterprises it 29 Sep. 2015 Implementing
assets
Ltd. controls); as for the related transactions, which are unavoidable or
replacement
occur for reasonable reasons between the company and other
enterprises under the control of the company, and Shougang Co. and
the enterprises it controls, the company will not require or accept the
more favorable conditions provided by Shougang Co. than the
conditions to an independent third party in any fair market transaction.
The company and other enterprises under the control of the company
will sign a standardized related party transaction agreement with
Shougang Co. in accordance with the law, follow the market principles
of openness, fairness and justice, in accordance with fair and
reasonable market price, conform to relevant provisions of laws,
regulations and normative documents in the decision-making
procedures of related transactions and disclose information in
accordance with the law.
2. The company and other enterprises controlled by the company will
not obtain any improper benefits or make Shougang Co. bear any
improper obligations through related party transactions with Shougang
Co. or the enterprises controlled by Shougang Co.
3. The company will be liable for the losses to Shougang Co. and the
enterprise controlled by Shougang Co. due to the related party
transactions with them in violation of the above commitments.
In respect of the purchase of 51% equity of Jingtang Co. by Shougang
Co., Shougang Group made the following commitments in urging
Jingtang Co. and its holding subsidiary, Tangshan Shougang Jingtang
Caofeidian Port Co., Ltd. (hereinafter referred to as Port Co.) to
complete relevant matters: Jingtang Co. and the
Port Co. have obtained
Shougang 1. The company promises to urge Jingtang Co. not to actually carry Refer to
relevant port operation
Group Co., out port operation business of general bulk cargo berth project 29 Sep. 2015 contents of
licenses, and this
Ltd. (552-meter shoreline wharf project) without obtaining formal or commitment
commitment has been
temporary port operation license.
fulfilled.
2. The company promises to urge Port Co. not to actually carry out
port operation business of general wharf project (1600-meter shoreline
wharf project) without obtaining formal or temporary port operation
license.
In respect of the purchase of 51% of the equity of Jingtang Co. by
Shougang Co., Shougang Group made the following commitments in
urging Jingtang Co. and its holding subsidiary, Tangshan Shougang The operating license
Jingtang Caofeidian Port Co., Ltd. (hereinafter referred to as Port for the 1240m port
Company) to complete relevant matters: supporting the terminal
of Jingtang Co. was
1. Shougang Group promises to urge Jingtang Co. to complete the
Shougang Refer to completed on April 18,
overall acceptance procedures of supporting wharf project
Group Co., 23 Dec. 2022 contents of 2023; The property
(1240-meter shoreline wharf project) and obtain the formal port
Ltd. commitment ownership certificates
operation license before 31 December 2022, and carry out port
for Jingtang Co. and the
operation business in accordance with the requirements of relevant
Port Co. have been
competent departments.
completed on October
2. Shougang Group promises to urge Jingtang Co. to complete the 31, 2023.
application of ownership certificate of all self-built houses of Jingtang
Co. before 31 December 2022.
In respect of the purchase of 51% of the equity of Jingtang Co. by
Shougang Co., the company made the following commitments in
urging Jingtang Co. and its holding subsidiary, Port Company, to
The land ownership
complete the relevant matters of obtaining land use right certificate:
Shougang certificate for Jingtang
The company promises to urge Jingtang Co. to obtain state-owned
Group Co., 23 Dec. 2022 31 Dec. 2023 Co. and the Port Co.
land use right certificate of all the land used before 31 December
Ltd. have been completed on
2023, including but not limited to the land used by Jingtang Co. Phase
January 31, 2023.
I project, Jingtang Co. supporting wharf project (1240-meter shoreline
wharf project), general bulk cargo berth project (552-meter shoreline
wharf project) and Jingtang Co. Phase II project.
The shares of the listed company acquired by the Fund as a result of
Beijing Jing the purchase of assets through the issuance of shares shall not be
Guorui Soe transferred within 36 months from the date of the completion of the
Reform and issuance of shares. If such shares are increased due to the listed 21 May. 2021 20 May. 2024 Implementing
Development company's granting of bonus shares, conversion of capital stock and
Fund(L.P.) other reasons, the additional shares of the listed company shall be
locked in accordance with the above lockup period.
53
Beijing Shougang Co. Ltd Annual Report 2023
1. The shares of the listed company acquired by the company in this
transaction shall not be transferred within 36 months from the date
when the shares are issued. However, transfers permitted by applicable
law are not subject to this restriction. Within six months after
completion of the transaction, if the closing price of the shares of the
listed company for 20 consecutive trading days is lower than the
issuing price of the shares, or the closing price at the end of six
months after the completion of this transaction is lower than the issue
price of this share, the locking period of shares obtained by the
Shougang company through this transaction will be automatically extended for
Group Co., six months on the basis of the above locking period. If such shares are 20 Dec.2022 19 Apr. 2025 Implementing
Ltd. increased due to the listed company's granting of bonus shares,
conversion of capital stock and other reasons, the additional shares of
the listed company shall be locked in accordance with the above
lockup period.
2. If the aforementioned commitment to lock up shares is inconsistent
with the latest regulatory opinions of the securities regulatory
authority, the company shall adjust the aforementioned commitment
according to the regulatory opinions of the relevant securities
regulatory authority.
The Asset Appraisal Report evaluates partial of intellectual property
rights of Jingtang Co. and Shanxi Coking Co., Ltd. (hereinafter
referred to as "performance commitment assets") based on future
earnings expectations. The appraisal value of 1,346 patent rights, 190
proprietary technologies, 32 software copyrights and other assets of
Jingtang Co. is RMB 242.8 million, and the appraisal value of 57
patent rights assets of Shanxi Coking Co., Ltd. is RMB 40 million.
In accordance with the forecast income sharing of the performance
committed assets, if the purchase of assets by issuing shares is Implementing.
Shougang
completed before 31 December 2022, Shougang Group commitments
Group Co., 20 Dec.2021 31 Dec. 2024 The commitments for
that, in 2022, 2023 and 2024, the total income sharing of performance 2022 and 2023 have
Ltd.
commitment assets in the current period shall be no less than RMB been fulfilled
90.9182 million, RMB 79.414 million and RMB 61.5618 million
respectively.
If the above performance commitments are not met, please refer to
"Performance Commitments and Impairment Compensation
Arrangements" in Beijing Shougang Co., Ltd. 's Report on Issuing
Shares to Purchase Assets and Raising Supporting Funds and Related
Party Transactions issued by the Company for detailed compensation
methods and arrangements.
Completed on time Yes
If the commitment is not
fulfilled on time, the
specific reasons for the
unfulfilled performance N/A
and the next step of the
work plan should be
explained in detail
2. Concerning assets or project of the Company, which has profit forecast, and reporting period still in forecasting period,
explain reasons of reaching the original profit forecast
□ Applicable √ Not applicable
II. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party during the reporting period.
III. External guarantees against the rules and regulations
□ Applicable √ Not applicable
No external guarantee provided by the Company which against the rules and regulations during the reporting period.
IV. Explanation from board of directors on the latest modified auditor’s report
□ Applicable √ Not applicable
V. Explanation from board of directors, supervisory committee and independent directors (if
applicable) on the current audit report with modified opinion.
□ Applicable √ Not applicable
VI. Changes in accounting policies, accounting estimates or correction of major accounting
errors as compared to the financial report for the prior year
√ Applicable □ Not applicable
On November 30, 2022, the Ministry of Finance issued Interpretation No. 16 of the Enterprise Accounting Standards (Finance and
Accounting [2022] No. 31), which stipulates that deferred income tax related to assets and liabilities arising from individual
transactions is not subject to the accounting treatment of initial recognition exemption. The above accounting treatment regulations
will be implemented from January 1, 2023.
54
Beijing Shougang Co. Ltd Annual Report 2023
VII. Explanation on the change in the scope of consolidated financial statements during the
reporting period as compared to financial report of the previous year
√ Applicable □ Not applicable
In April 2023, the Company completed the separation of its subsidiary Beijing Shougang New Energy Automobile Material
Technology Co., Ltd. and completed the clear deregistration procedures of the separated Beijing Shougang New Energy Automobile
Material Technology Co., Ltd. in December. After deregistration, the number of subsidiaries within the scope of consolidation in
current period changed from 6 to 5. The 5 subsidiaries are: Shougang Jingtang United Iron & Steel Co., Ltd., Shougang Zhixin
Qian'an Electromagnetic Materials Co., Ltd., Beijing Shougang Cold Rolling Co., Ltd., Beijing Shougang Steel Trading Investment
Management Co., Ltd., and Qian'an Shougang Metallurgical Technology Co., Ltd.
VIII. Appointment and non-reappointment (dismissal) of CPA
Current accounting firm
Name of domestic accounting firm Grant Thornton LLP.
Remuneration for domestic accounting firm (RMB 0,000) 180
Continuous life of auditing service for domestic accounting firm (year) 24
Name of domestic CPA Li Dan, Yu Qike
Continuous life of auditing service for domestic accounting firm (year) 2
Whether to change the accounting firm during the audit period
□ Yes √ No
Appointment of internal control auditing accounting firm, financial consultant or sponsor
√ Applicable □ Not applicable
During the reporting period, the Company engaged Grant Thornton LLP. as the auditor for internal control of the Company for 2023.
IX. Suspension and termination of listing after disclosure of annual report
□ Applicable √ Not applicable
X. Insolvency or restructuring related matters
□ Applicable √ Not applicable
No insolvency or restructuring related matters during the reporting period
XI. Material litigation or arbitration cases
□ Applicable √ Not applicable
No material litigation or arbitration cases during the reporting period.
XII. Punishment or rectification
□ Applicable √ Not applicable
No punishment or rectification during the reporting period.
XIII. Integrity of the Company and its controlling shareholders and actual controllers during
the reporting period
□ Applicable √ Not applicable
XIV. Material related party transactions
1. Related transaction with routine operation concerned
√ Applicable □ Not applicable
Whether it Available
Pricing Related Approved Related
Proportion exceeds market
principle transaction transaction transactio Date of
Related Relationshi Transactio Transactio Transactio in similar the prices for
of price quota n disclosur Disclosure index
parties p n type n content n price transaction approved similar
transactio (RMB’0,000 (RMB’0,000 settlement e
s quota(Y/N transaction
n ) ) methods
) s
"China Securities
Raw fuel,
Shougang Journal" ,"Securities
power
Group and Cash at Times" ,"Shanghai
Parent Related energy, Market Market Market 7 Dec.
its 4,642,653 4,758,480 N bank and Securities News", Juchao
company purchase production price price price 2022
subsidiarie on hand Information Network
services,
s (http://www.cninfo.com.c
etc
n)
Shougang Steel,
Group and solid Cash at
Parent Related Market Market Market 7 Dec.
its waste, 256,142 375,508 N bank and Ditto
company sales price price price 2022
subsidiarie power on hand
s energy, etc
Raw fuel,
Other Joint Cash at
Related power Market Market Market 7 Dec.
related venture and 2,565,419 2,978,818 N bank and Ditto
purchase energy, price price price 2022
parties associates on hand
production
55
Beijing Shougang Co. Ltd Annual Report 2023
services,
etc
Other Joint Steel, Cash at
Related Market Market Market 7 Dec.
related venture and power 419,447 393,643 Y bank and Ditto
sales price price price 2022
parties associates energy, etc on hand
Total -- -- 7,883,661 -- 8,506,449 -- -- -- -- --
Details of large sales returns No
The Company's proposal on the re signing of the Framework Agreement between Shougang Group Co., Ltd. and Beijing Shougang
The Company classifies the daily related Co., Ltd. on Related Party Transactions and the Estimated Amount of Daily Related Party Transactions for the Year 2023, based on the
transactions by category and estimates the estimated total amount of daily related party transactions, was reviewed and approved by the 15th meeting of the 7th Board of
transaction amount that will take place in the Directors of the company on December 7, 2022, and submitted for approval at the 4th Extraordinary General Meeting of Shareholders
current period, and discloses the actual of the company for the year 2022 on December 24, 2022. The total transaction amount approved by the shareholders' meeting for this
transaction amount (if any) period is RMB85,064.49 million, with a total amount of RMB78,836.61 million incurred, which does not exceed the approved limit.
Please refer to Section 10 for specific information on related parties and related transactions.
The reason for the material difference between
the transaction price and the market reference Not Applicable
price (if applicable)
2. Related party transactions by assets or equity acquisition and sold
□ Applicable √ Not applicable
3. Related transactions of mutual investment outside
□ Applicable √ Not applicable
No related party transactions in respect of jointly investment during the reporting period.
4. Related creditor's rights and debts
√ Applicable □ Not applicable
Whether the Company had non-operating contact of related credit and debt
□ Applicable √ Not applicable
No related creditor's rights and debts in the reporting period
5. Transactions with related financial companies
√ Applicable □ Not applicable
Deposit
Current amount
Relationship Maximum daily Closing
Range of deposit Opening balance balance
Related party with the deposit limit Total deposit amount Total withdrawal
(RMB’0,000)
interest rate (RMB’0,000)
Company of current period amount of current (RMB’0,000)
(RMB’0,000) period (RMB’0,000)
Under the
Shougang
control of the
Group Finance 1,600,000 1.15%-1.90% 878,266.33 15,520,954.47 15,486,359.93 912,860.87
same parent
Co., Ltd.
company
Loan
Current amount
Relationship Closing
Amount Loan interest Opening balance
Related party with the balance
(RMB’0,000) rate range (RMB’0,000) Total loan amount of Total repayment
Company current period amount of current (RMB’0,000)
(RMB’0,000) period (RMB’0,000)
Under the
Shougang
control of the
Group Finance 3,025,660 1.85%-2.87% 1,801,689.43 2,142,679.28 2,405,447.59 1,538,921.11
same parent
Co., Ltd.
company
Credit granting or other financial services
Related party Relationship with the Company Business types Total amount(RMB’0,000) Actual amount(RMB’0,000)
Shougang Group Finance Co., Under the control of the same
Credit 3,025,660 1,538,921.11
Ltd. parent company
6. Transactions between financial companies controlled by the company and related parties
□ Applicable √ Not applicable
The Company has no deposits, loans, credits, or other financial services between the financial companies controlled by the Company
and the related parties
7. Other significant related party transactions
□ Applicable √ Not applicable
No other significant related party transaction of the Company during the reporting period.
56
Beijing Shougang Co. Ltd Annual Report 2023
XV. Material contracts and implementation
1. Entrustment, contract and leasing
(1) Entrustment
□ Applicable √ Not applicable
No entrustment during the reporting period.
(2) Contract
□ Applicable √ Not applicable
No contract during the reporting period.
(3) Leasing
□ Applicable √ Not applicable
No leasing during the reporting period.
2. Material guarantees
√ Applicable □ Not applicable
Unit: RMB0,000
External guarantees of the Company and its subsidiaries (excluding guarantees to subsidiaries)
Date of the
related Guarantee to
Name of announcement Amount of Guarantee Guarantee Type of Collateral (if Counterguarantee Fulfilled or related
Term
obligee disclosing the guarantee date provided guarantee any) (if any) not parties or
guarantee not
amount
Shougang
Guarantee of
(Qingdao) 18
joint and
Steel 10 June 2023 21,000 September 14,203 One year No Yes
several
Industry Co., 2023
liability
Ltd.
Ningbo Guarantee of
Shougang 15 February joint and
10 June 2023 4,400 3,275.52 One year No Yes
Zhejin Steel 2023 several
Co., Ltd. liability
Total external guarantees Total actual external
approved during the 25,400 guarantees during the 17,478.52
reporting period (A1) reporting period (A2)
Total external guarantees Balance of total actual
approved at the end of the 25,400 guarantees at the end of 17,478.52
reporting period (A3) the reporting period (A4)
Guarantees between the Company and its subsidiaries
Date of the
related Guarantee to
Name of announcement Amount of Guarantee Guarantee Type of Collateral (if Counterguarantee Fulfilled or related
Term
obligee disclosing the guarantee date provided guarantee any) (if any) not parties or
guarantee not
amount
Shanghai
Guarantee of
Shougang
joint and
Steel & Iron 10 June 2023 16,050 17 July 2023 4,875 One year No Yes
several
Trading Co.,
liability
Ltd.
Total amount of guarantee Total amount of guarantee
provided for subsidiaries provided for subsidiaries
16,050 4,875
approved during the during the reporting period
reporting period (B1) (B2)
Total amount of guarantee Total balance of guarantee
provided for subsidiaries provided for subsidiaries
16,050 4,875
approved as at the end of the as at the end of the
reporting period (B3) reporting period (B4)
Total actual amount of
Total approved guarantee
guarantees incurred during
amount during the reporting 41,450 22,353.52
the reporting period
period (A1+B1)
(A2+B2)
Total approved guarantee Total actual guarantee
amount at the end of the 41,450 balance at the end of the 22,353.52
reporting period (A3+B3) reporting period (A4+B4)
The percentage of total amount of guarantee provided
0.45%
(i.e. A4+B4) to the net assets of the Company
Explanation of the specific situation of using composite guarantee
Not applicable
3. Entrusted asset management, entrusted loans and other wealth management and derivatives investment
(1) Entrusted asset management and other wealth management and derivatives investment
□ Applicable √ Not applicable
57
Beijing Shougang Co. Ltd Annual Report 2023
No entrusted asset management and other wealth management and derivatives investment during the reporting period.
(2) Entrusted loans
□ Applicable √ Not applicable
No entrusted loan during the reporting period.
4. Other material contracts
□ Applicable √ Not applicable
No other material contracts during the reporting period.
XVI. Explanation of other significant matters
√ Applicable □ Not applicable
1. Ye Lin, an independent director, served for 6 consecutive years in the company and resigned on December 25, 2023; Supervisor
Guo Liyan resigned from position as supervisor on January 9, 2024 due to job transfer. On February 22, 2024, the first
extraordinary general meeting of shareholders of the Company elected Comrade Wang Cuimin as an independent director and
Dai Jun as the supervisor of the Company.
2. Zhu Guosen resigned from the position of General Manager on March 21, 2024 due to work transfer. On March 22, 2024, the
6th meeting of the 8th Board of Directors of the Company appointed Sun Maolin as the new General Manager of the Company.
3. Zhu Guosen and Zeng Li both resigned from positions as directors of the Company on March 21, 2024 due to job transfers. On
April 8, 2024, the second extraordinary general meeting of shareholders of the Company elected Sun Maolin and Li Ming as
directors of the Company.
4. On April 18, 2024, the seventh session of the eighth board of directors of the Company appointed Zhao Peng as the deputy
general manager of the Company.
XVII. Significant matters of subsidiaries of the Company
√ Applicable □ Not applicable
1. About Zhixin Co.
(1) In December 2022, the Company signed the "Capital Increase Agreement on Shougang Zhixin Qian'an Electromagnetic
Materials Co., Ltd." with Zhixin Co., the original shareholders of Zhixin Co. and all investors participating in the capital
increase, and the investors jointly invested RMB 2 billion to become the strategic investors of Zhixin Co. On January 28, 2023,
Zhixin Co. completed the industrial and commercial registration procedures for the capital increase and obtained a new business
license. The company's shareholding in Zhixin Co. changed to 68.0293%.
(2) According to the resolution of the 5th extraordinary meeting of the board of directors of Shougang Co. in 2023, the company,
together with Shougang Group and Zhixin Co.’s employee shareholding platform jointly increased capital to Zhixin Co. On
November 28, 2023, Zhixin Co. completed the industrial and commercial registration procedures for the capital increase and
obtained a new business license. The company's shareholding in Zhixin Co. changed to 66.2310%.
(3) According to the resolution of the 5th meeting of the 8th Board of Directors of Shougang Co., Zhixin Co. was undergoing a
shareholding reform, and its registered capital changed from RMB 11.29982844519 billion to RMB 300 million. The founding
meeting was held on March 22, 2024. On March 27, 2024, Zhixin Co. completed the industrial and commercial registration
change, and the name was changed to Shougang Zhixin Electromagnetic Materials (Qian'an) Co., Ltd. The company still holds
66.2310% equity in the Zhixin Co.
2. About Beijing Shougang New Energy Automobile Material Technology Co., Ltd.
(1) According to the resolution of the first extraordinary meeting of the board of directors of Shougang Co., Ltd. in 2023, the
controlling subsidiary of the company, Beijing Shougang New Energy Automobile Material Technology Co., Ltd. (hereinafter
referred to as "New-E Co."), was implementing a continuing separation. After the separation, New-E Co. became the surviving
company, with its shareholders changed to Shougang Group Co., Ltd. and Qian'an Jingji Equity Investment Fund (Limited
Partnership), and a new Beijing Shougang New Energy Materials Technology Co., Ltd. (hereinafter referred to as "New Energy
Materials") was established, with its shareholders being Shougang Co., Ltd. and Beijing Shouxin Jinyuan Management
Consulting Center (Limited Partnership). As of April 25, 2023, the industrial and commercial registration procedures for the
current separation have been completed, and New-E Co. and New Energy Materials have obtained their respective business
licenses.
(2) According to the resolution of the 5th extraordinary meeting of the board of directors of Shougang Co., Ltd. in 2023, New
Energy Materials plans to dissolve and liquidate. As of December 22, 2023, New Energy Materials have obtained the
"Cancellation Approval Notice" and "Cancellation Registration Notice" issued by the Shunyi District Market Supervision
Administration of Beijing, and have completed tax cancellation, bank account cancellation, and industrial and commercial
deregistration.
58
Beijing Shougang Co. Ltd Annual Report 2023
Section VII. Movements in share capital and shareholders
I. Share movement
1. Share movement
Unit: share
Before change Increase (/decrease) during the year After change
Converted
New shares Bonus
Amount Ratio from Others Subtotal Amount Ratio
issued issue
reserves
I. Restricted shares 1,806,563,829 23.10% -25,257,565 -25,257,565 1,781,306,264 22.85%
1. State ownership
2. State-owned
1,741,662,029 22.27% 1,741,662,029 22.34%
corporation shares
3. Shares held by
other domestic 64,901,800 0.83% -25,257,565 -25,257,565 39,644,235 0.51%
investors
Of which:
Shares held by
domestic legal
persons
Shares held
by domestic natural 64,901,800 0.83% -25,257,565 -25,257,565 39,644,235 0.51%
persons
4.Foreign
ownership
Of which:
Shares held by
overseas legal
persons
Shares held
by overseas natural
persons
II. Non-restricted
6,013,305,341 76.90% 6,013,305,341 77.15%
shares
1. RMB ordinary
6,013,305,341 76.90% 6,013,305,341 77.15%
shares
2. Domestic listed
foreign shares
3. Overseas listed
foreign shares
4.Others
III. Total number of
7,819,869,170 100.00% -25,257,565 -25,257,565 7,794,611,605 100.00%
shares
Reasons of shares movements
√Applicable □ Not applicable
According to the Incentive Plan, with the approval of the company's shareholders meeting, the company has repurchased and
cancelled 25,257,565 restricted shares during the reporting period, and share capital of the company have been reduced from
7,819,869,170 shares to 7,794,611,605 shares.
Approval of share movements
√ Applicable □ Not applicable
The restricted stocks repurchased and cancelled by the company during the reporting period have been reviewed and approved at the
2022 annual shareholders meeting on June 30, 2023 and the first extraordinary shareholders meeting on September 28, 2023.
Transfer of shares arising from changes in shareholding
√ Applicable □ Not applicable
The restricted shares repurchased by the company have been cancelled in accordance with regulations.
Influences of shares movements on basic EPS, diluted EPS, net assets per share attributable to common shareholders of the
company and other financial indicators for both the latest year and the latest period
√ Applicable □ Not applicable
During the reporting period, after completed the repurchase and cancellation of the restricted shares mentioned above, the total share
capital of the company decreased, which resulted in an increase in earnings per share and net assets per share for the most recent year
and period.
59
Beijing Shougang Co. Ltd Annual Report 2023
Other information necessary to disclose for the Company or need to disclosed under requirement from security regulators
□ Applicable √ Not applicable
2. Movements of restricted shares
√ Applicable □ Not applicable
Unit: share
Restricted
Restricted Restricted
shares Restricted
Name of shares at the shares increased Date of release
released shares at the Reason for restriction
shareholders beginning of during the from restriction
during the end of period
period period
period
Reasons for restricted sales of
232,286,354 shares:
The commitments made by Shougang
Group when the Company was first
restructured are still being fulfilled. For
details, please refer to the company's
The restriction can
announcements in "China Securities
be lifted after the
Shougang Group Journal" "Securities Times" "Shanghai
1,247,703,723 0 0 1,247,703,723 performance of the
Co., Ltd. Securities News", CNINFO
commitment;
(http://www.cninfo.com.cn)on 28
19 April 2025
September 2019.
Reasons for restricted sales of other
shares:
Share lock up commitment made as the
counterparty to the company's issuance
of shares to purchase assets.
For details, please refer to the relevant
Beijing Jing
announcement issued by the Company on
Guorui Soe
20 May 2021.
Reform and 493,958,306 0 0 493,958,306 20 May 2024
Share lock up commitment made as the
Development
counterparty to the company's issuance
Fund(L.P.)
of shares to purchase assets.
According to the
Incentive Plan, the
Company has
repurchased and
cancelled the
restricted stocks
corresponding to
In accordance with relevant regulations,
the first period of
Shougang the Company's 2021 restricted stock
lifting restrictions;
Directors, senior incentive plan will arrange the lock-up
The restricted
executives and 64,901,800 0 25,257,565 39,644,235 period of the restricted stock grants.
period for the
other equity For details, please refer to the relevant
remaining restricted
incentive targets announcement issued by the Company on
stocks is 36 months
13 November 2021.
and 48 months from
the date of
completion of grant
registration, namely
December 24, 2024
and December 24,
2025, respectively
Total 1,806,563,829 0 25,257,565 1,781,306,264 -- --
II. Securities issuance and listing
1. Security offering (without preferred stock) in reporting period
□ Applicable √ Not applicable
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and liability structure
√ Applicable □ Not applicable
According to the Incentive Plan, with the approval of the company's shareholders meeting, a total of 25,257,565 shares of restricted
stock have been repurchased and cancelled by the company during the reporting period. There has been a change in shareholder
structure and the decrease in the total number of shares of the Company. There is no impact on the asset and liability structure of the
Company.
3. Current internal staff shares
□ Applicable √ Not applicable
III. Shareholders and the actual controller
1. Amount of shareholders and shareholding
Unit: Share
60
Beijing Shougang Co. Ltd Annual Report 2023
Total preference
shareholders with
Total common Total preference
voting rights
stock shareholders shareholders with voting
Total common stock recovered at end of
at end of last rights recovered at end
shareholders in 93,835 94,900 0 last month before 0
month before of reporting period (if
reporting period-end annual report
annual report applicable) (found in
disclosed (if
disclosed note 8)
applicable) (found
in note 8)
Shareholders holding above 5% or top 10 shareholders
Total Shares pledged or
Amount of Amount of
Nature of Shareholding shareholders at Changes in frozen
Name of shareholder restricted unrestricted
shareholder ratio the end of report report period
shares held shares held Status Amount
period
State-owned
Shougang Group 56.72% 4,420,769,800 0 1,247,703,723 3,173,066,077 N/A 0
legal entity
State-owned
Baowu Group 10.18% 793,408,440 0 0 793,408,440 N/A 0
legal entity
Beijing Jingtou Investment State-owned
9.51% 740,940,679 0 0 740,940,679 N/A 0
Holding Co., Ltd. legal entity
Beijing Jing Guorui Soe
State-owned
Reform and Development 6.34% 493,958,306 0 493,958,306 0 N/A 0
legal entity
Fund(L.P.)
Sunshine Life Insurance Co.,
Ltd. - Traditional insurance Others 0.98% 76,692,529 0 0 76,692,529 N/A 0
products
Domestic
Liu Wei 0.87% 682,000,000 +14,200,000 0 68,200,000 N/A 0
natural person
Sunshine Life Insurance Co.,
Ltd. - Dividend insurance Others 0.72% 56,159,243 0 0 56,159,243 N/A 0
products
Hong Kong Securities Overseas
0.72% 55,782,302 +12,051,904 0 55,782,302 N/A 0
Clearing Company Limited legal entity
Shanxi Coking Coal Group State-owned
0.41% 32,155,928 0 32,155,928 N/A 0
Finance Co., Ltd. legal entity
National Social Security Fund
Others 0.35% 27,661,700 -39,885,983 0 27,661,700 N/A 0
- Eight combinations
Strategic investor or general legal person
becoming a top-10 ordinary shareholder due Not applicable
to rights issue (if any) (found in note 10)
Subsidiary of Shougang Group holds 0.68% of Baosteel Co., Baowu Group Co., Ltd. and its persons
Related or acting-in-concert parties among the acting in concert hold 62.30%of Baosteel Co. Except which, Shougang Group has no relationship or
shareholders above concerted acting relationship with other top 10 shareholders; The relationship between other
shareholders or the relationship of cooperators is unknown.
Above shareholders involved in entrusting /
being entrusted with voting rights and giving Not applicable
up voting rights
Special account for share repurchases (if any)
among the top 10 shareholders(found in note Not applicable
10)
Shareholding of the top 10 shareholders unrestricted shares held
Type of shares
Name of shareholders Amount of unrestricted shares held at period-end
Type Amount
RMB ordinary
Shougang Group 3,173,066,077 3,173,066,077
shares
RMB ordinary
Baowu Group 793,408,440 793,408,440
shares
RMB ordinary
Beijing Jingtou Investment Holding Co., Ltd. 740,940,679 740,940,679
shares
Sunshine Life Insurance Co., Ltd.- Traditional RMB ordinary
76,692,529 76,692,529
insurance products shares
RMB ordinary
Liu Wei 68,200,000 68,200,000
shares
Sunshine Life Insurance Co., Ltd. - Dividend RMB ordinary
56,159,243 56,159,243
insurance products shares
Hong Kong Securities Clearing Company RMB ordinary
55,782,302 55,782,302
Limited shares
RMB ordinary
Shanxi Coking Coal Group Finance Co., Ltd. 32,155,928 32,155,928
shares
61
Beijing Shougang Co. Ltd Annual Report 2023
National Social Security Fund - eight RMB ordinary
27,661,700 27,661,700
combinations shares
Guoshou Pension Strategy No. 4 Stock based
RMB ordinary
Pension Product - Industrial and Commercial 22,036,104 22,036,104
shares
Bank of China Limited
Connected associated relationship or acting in
concert among the top 10 shareholders Subsidiary of Shougang Group holds 0.68% of Baosteel Co., Baowu Group Co., Ltd. and its persons
holding tradable shares without selling acting in concert hold 62.30%of Baosteel Co. Except which, Shougang Group has no relationship or
restrictions, and between the top 10 concerted acting relationship with other top 10 shareholders; The relationship between other
shareholders holding tradable shares without shareholders or the relationship of cooperators is unknown.
selling restrictions and the top 10 shareholders
Top 10 ordinary shareholders involved in
Liu Wei holds 68,200,000 shares of the company through its credit securities account.
securities margin trading (if any)
The top ten shareholders participating in the lending of shares through refinancing business
□ Applicable √ Not applicable
Changes of the top ten shareholders compared to the previous period
√ Applicable □ Not applicable
Unit: Share
Changes in the top 10 shareholders compared to the end of the previous period
The number of shares held in the ordinary
New At the end of the period, the number account and credit account of shareholders at the
additions/exi of shares lent through refinancing end of the period, as well as the shares lent
Shareholder Name ts during this and not yet repaid through refinancing, that have not yet been
reporting returned
period Proportion to total Proportion to total
Total quantity Total quantity
share capital share capital
New
Shougang Group Co., Ltd. 0 0.00% 0 0.00%
addition
China Baowu Steel Group Corporation New
0 0.00% 0 0.00%
Ltd. addition
Beijing Jingtou Investment Holding Co., New
0 0.00% 0 0.00%
Ltd. addition
Beijing Jing Guorui Soe Reform and New
0 0.00% 0 0.00%
Development Fund(L.P.) addition
Sunshine Life Insurance Co., Ltd.- New
0 0.00% 0 0.00%
Traditional insurance products addition
New
Liu Wei 0 0.00% 0 0.00%
addition
Sunshine Life Insurance Co., Ltd. - New
0 0.00% 0 0.00%
Dividend insurance products addition
Hong Kong Securities Clearing Company New
0 0.00% 0 0.00%
Limited addition
Shanxi Coking Coal Group Finance Co., New
0 0.00% 0 0.00%
Ltd. addition
National Social Security Fund - eight New
0 0.00% 0 0.00%
combinations addition
Whether top ten common stock shareholders or top ten common stock shareholders with unrestricted shares have a buy-back
agreement dealing during the reporting period
□ Yes √ No
The top ten common stock shareholders or top ten common stock shareholders with unrestricted shares of the Company have no
buy-back agreement dealing during the reporting period.
2. Controlling shareholders
Nature of controlling shareholders: local state-owned holding
Type of controlling shareholders: legal person
Name of Legal representative /
Date of
controlling person in charge of Organization code Main businesses
establishment
shareholders the company
Industry, construction, geological examination, transportation,
foreign trade, post and telecommunications, finance and
insurance, scientific research and comprehensive technical
services, domestic commerce, public catering, material supply and
marketing, warehousing, real estate, residential services,
Shougang consulting services, leasing, agriculture, forestry, animal
Zhao Minge 13 May 1981 911100001011200015
Group husbandry and fishery (excluding business without special
permission); authorized operation and management of
state-owned assets; hosted Shougang Daily newspaper; design
and production of TV advertisements; use of self-owned TV
stations to publish advertisements; design and production of print
advertising; use of self-owned Shougang Daily to publish
62
Beijing Shougang Co. Ltd Annual Report 2023
advertisements; sewage treatment and recycling; seawater
desalination; literary and artistic creation and performance: sports
project management (excluding high-risk sports projects); stadium
management; Internet information services; Municipal solid waste
treatment. (enterprises shall independently choose business
projects and carry out business activities in accordance with the
law; municipal solid waste treatment, Internet information
services and projects subject to approval in accordance with the
law after licensing; they shall not engage in business projects
prohibited or restricted by local policies)
Shareholdings
of controlling
shareholders
who have 1. Domestic: (1) Hua Xia Bank Co., Ltd., holds 21.68%; (2) Beiqi Foton Motor Co., Ltd., holds 0.15%; (3) BAIC MOTOR
control or hold Corporation., Ltd. (H-share), holds 12.83%.
shares in other 2. Overseas: (1) Capital Industrial Financial Services Group Limited, holds 60.88%; (2) Shoucheng Holdings Limited, holds 24.66%;
domestic or (3) Shougang Fushan Resources Group Ltd., holds 33.24%; (4) Shougang Century Holdings Limited, holds 49.71%; (5) Global
overseas listed Digital Creations Holdings Limited, holds 41.18%; (6) CWT International Limited，holds 3.11%; (7) Newton Resources Limited,
companies holds 27.46%; (8) Sunshine Insurance Group Co., Ltd., holds 0.58%.
during the
reporting
period
Controlling shareholder turnover during the reporting period
□ Applicable √ Not applicable
There were no changes of controlling shareholders during the reporting period.
3. Actual controller of the company and persons acting in concert
Nature of actual controller: local management agency of state-owned assets
Type of actual controller:
Actual controller turnover during the reporting period
□ Applicable √ Not applicable
The actual controller of the company was not changed during the reporting period.
Block diagram of property rights and controlling relations between the Company and actual controllers is as follows:
Actual controller controlling the company through trust or other asset management methods
□ Applicable √ Not applicable
4. The number of shares pledged by the controlling shareholder or the largest shareholder of the Company and persons
acting in concert with it reaches 80% of the number of shares held by them in aggregate
□ Applicable √ Not applicable
5. Other legal person shareholders with over 10% shares held
√ Applicable □ Not applicable
Name of legal person Legal representative / person in Date of
Registered capital Main businesses
shareholders charge of the company establishment
63
Beijing Shougang Co. Ltd Annual Report 2023
Licensed project: Retail of publications;
Wholesale of publications. (For projects that
require approval according to law, business
activities can only be carried out with the
approval of relevant departments. The specific
business projects shall be subject to the
approval documents or licenses of relevant
departments.) General projects: engaging in
investment activities with self owned funds;
Investment management; Asset management
services for self owned fund investment;
Enterprise headquarters management; Land
China Baowu Steel
Hu Wangming 1 Jan. 1992 RMB 52,791,101,000 use right leasing; Non residential real estate
Group Corporation Ltd.
leasing; Tax services; Human resources
services (excluding occupational intermediary
activities and labor dispatch services);
Registration and agency of market entities;
Business agency services; Undertake
outsourcing of archival services; Tendering
and bidding agency services; Big data services;
Enterprise management consulting. (Except for
projects that require approval according to law,
business activities shall be conducted
independently based on the business license in
accordance with the law)
6. Limitation on reducing the holdings of shares of controlling shareholders, actual controllers, restructuring side and other
commitment subjects
□ Applicable √ Not applicable
IV. The implementation of share repurchase during the reporting period
Progress of share repurchase
□ Applicable √ Not applicable
Implementation progress of reducing and repurchasing shares through centralized bidding
□ Applicable √ Not applicable
64
Beijing Shougang Co. Ltd Annual Report 2023
Section VIII. Preferred Shares
□ Applicable √ Not applicable
No preferred shares issued by the Company during the reporting period.
65
Beijing Shougang Co. Ltd Annual Report 2023
Section IX. Bonds
√ Applicable □ Not applicable
Ⅰ. Enterprise bonds
□ Applicable √ Not applicable
The Company had no enterprise bonds during the reporting period.
II. Corporate Bonds
√ Applicable □ Not applicable
1. Basic information on Corporate Bonds
Unit: RMB’0,000
Outstanding
Bond Interest Trading
Name of bond Bond code Issue date Value date Maturity date amount of the Payment method
abbreviation rate venue
bonds
Interest is
calculated on an
annual basis, not
Beijing
compound. The
Shougang Co.,
interest is paid once
Ltd.2020 Public
a year, and the Shenzhen
Offering of 20 Shouqian 15 September 17 September 17 September
149236 0 3.98% principal is repaid Stock
corporate bonds 01 2020 2020 2025
once it is due. The Exchange
to Professional
last installment of
Investors (Phase
interest is paid
I)
together with the
repayment of the
principal.
Investor eligibility arrangement (if any) Public offering for professional investors
Applicable trading mechanism Matching transaction, click transaction, inquiry transaction, bidding transaction, negotiation transaction
Whether there are delisting risks (if any)
No
and counter-measures
Overdue and outstanding bonds
□ Applicable √ Not applicable
2. Triggering and execution of issuer’s or investor’s option clause or investor protection clause
√ Applicable □ Not applicable
The bond (20 Shouqian 01) has a five-year maturity with an issuer option to adjust the coupon rate at the end of the third year and an
investors’ put option. In September 2023, the bondholders of 20 Shouqian 01 chose to sell all their bonds back to the issuer. After the
issuer completed the redemption payment process, 20 Shouqian 01 was delisted on September 18, 2023.
3.Particulars of intermediary organisations
Name of the Name of Contact person of
Bond Name intermediary Business address signing the intermediary Tel.
organisation accountant organisation
Beijing Shougang Co.,
5F, Saite Plaza, 22
Ltd.2020 Public Offering of
Grant Thornton Jianguomenwai Dajie, Qian Bin, Yu Qike, Qian Bin, Yu Qike,
corporate bonds to 010-85665231
LLP Chaoyang District, Beijing, Long Chuanxi Long Chuanxi
Professional Investors
China
(Phase I)
Beijing Shougang Co.,
6F, Building A, Fengming
Ltd.2020 Public Offering of
Huatai United International Building, 22
corporate bonds to Jiang Jiaxiang 010-56839300
Securities Co., Ltd. Fengsheng Hutong, Xicheng
Professional Investors
District, Beijing
(Phase I)
Beijing Shougang Co.,
16F, Building B, Kaiheng
Ltd.2020 Public Offering of
CITIC Securities Center, No.2 Chaonei Street,
corporate bonds to Liu Chuyu 010-65608485
Co., Ltd Dongcheng District, Beijing,
Professional Investors
China
(Phase I)
Beijing Shougang Co.,
33F, Tower 2, Guomao
Ltd.2020 Public Offering of China International
Building, Jianguomenwai
corporate bonds to Capital Corporation Wang Hongtai 010-65051166
Street, Chaoyang District,
Professional Investors Limited
Beijing, China
(Phase I)
66
Beijing Shougang Co. Ltd Annual Report 2023
Name of the Name of Contact person of
Bond Name intermediary Business address signing the intermediary Tel.
organisation accountant organisation
Beijing Shougang Co.,
11-21/F, Building A, Building
Ltd.2020 Public Offering of Capital Securities
13, Yard 5, Anding Road,
corporate bonds to Corporation Li Kang 010-81152595
Chaoyang District, Beijing,
Professional Investors Limited
China
(Phase I)
Beijing Shougang Co.,
34F, Office Building No.3,
Ltd.2020 Public Offering of Beijing Jingtian
Huamao Center, 77 Jianguo 010-58091281
corporate bonds to Gongcheng Law Deng Qing, Yang Yao
Road, Chaoyang District, 010-58091048
Professional Investors Firm
Beijing, China
(Phase I)
Beijing Shougang Co.,
3F, China Foreign Language
Ltd.2020 Public Offering of Dagong Global
Building, 89 Xisanhuan North
corporate bonds to Credit Rating Co., Liu Yinling 010-67413322
Road, Haidian District,
Professional Investors Ltd.
Beijing, China
(Phase I)
Change of the above intermediary organisations during the reporting period
□ Yes √ No
4. Use of proceeds
Unit: RMB’0,000
Is the use of
proceeds consistent
with the use of
Rectification
Operation of special proceeds
Total amount Utilised Unutilised of irregularities guaranteed under
Bond Name account for the
of proceeds amount amount in the use of
proceeds (if any) the prospectus,
proceeds (if any)
proposed use of
proceeds and other
agreement？
During the
Beijing Shougang Co., reporting period,
Ltd.2020 Public the operation of the
Offering of corporate 250,000 250,000 0.00 Company's special No Consistent
bonds to Professional account for raised
Investors (Phase I) funds conforms to
the standard
Proceeds to be used for construction projects
□ Applicable √ Not applicable
During the reporting period, the company changed the purpose of raising funds through the aforementioned bonds
□ Applicable √ Not applicable
5. Adjustment of credit rating results during the reporting period
□ Applicable √ Not applicable
6. Implementation of and changes in guarantee, debt repayment plan and other repayment guarantee measures during the
reporting period and their impacts on the rights and interests of bond investors
□ Applicable √ Not applicable
III. Non-financial corporate debt financing instruments
√ Applicable □ Not applicable
1.Basic information of non-financial corporate debt financing instruments
Unit: RMB’0,000
Outstanding
Maturity Interest Payment Trading
Name of bond Bond abbreviation Bond code Issue date Value date amount of the
date rate method venue
bonds
Beijing Shougang
Co., Ltd.2022 Repayment National
22Shougang
Ultra-short-term 18 August 19 August 24 April of principal inter-bank
SCP002 (Kechuang 012282924 0 1.68%
financing note 2022 2022 2023 and interest bond
Note)
(Phase II) once due market
(Kechuang Note)
Beijing Shougang
Repayment National
Co., Ltd. 2023 20
23Shougang 17 April of principal inter-bank
Ultra-short-term 012381548 14 April 2023 October 0 2.37%
SCP001 2023 and interest bond
financing note 2023
once due market
(Phase I)
67
Beijing Shougang Co. Ltd Annual Report 2023
Outstanding
Maturity Interest Payment Trading
Name of bond Bond abbreviation Bond code Issue date Value date amount of the
date rate method venue
bonds
Beijing Shougang
Repayment National
Co., Ltd. 2023 8 22
22Shougang 7 September of principal inter-bank
Ultra-short-term 012383409 September December 0 2.21%
SCP002 2023 and interest bond
financing note 2023 2023
once due market
(Phase II)
Beijing Shougang
Co., Ltd.2023 Repayment National
23Shougang 16
Ultra-short-term 15 November 19 April of principal inter-bank
SCP003 (Kechuang 012384132 November 100,000 2.56%
financing note 2023 2024 and interest bond
Note) 2023
(Phase III) once due market
(Kechuang Note)
Institutional investors in the national inter-bank bond market (except purchasers prohibited by
Investor eligibility arrangement (if any)
national laws and regulations)
Applicable trading mechanism Non-financial enterprise debt financing instrument trading system
Whether there are delisting risks (if any) and
No
countermeasures
Overdue and outstanding bonds
□ Applicable √ Not applicable
2. Triggering and execution of issuer’s or investor’s option clause or investor protection clause
□ Applicable √ Not applicable
3. Particulars of intermediary organisations
Name of the Name of Contact person of
Bond Name intermediary Business address signing the intermediary Tel
organisation accountant organisation
Beijing Shougang Co.,
5F, Saite Plaza, 22
Ltd.2022
Jianguomenwai Dajie,
Ultra-short-term Grant Thornton LLP Qian Bin, Liu Yiwei Qian Bin, Liu Yiwei 010-85665231
Chaoyang District,
financing note (Phase
Beijing, PRC.
II) (Kechuang Note)
Beijing Shougang Co., 34F, Office Building
Ltd.2022 no.3, Huamao Center, 010-58091281
Beijing Jingtian
Ultra-short-term 77 Jianguo Road, Deng Qing, Yang Yao
Gongcheng Law Firm 010-58091048
financing note (Phase Chaoyang District,
II) (Kechuang Note) Beijing, PRC.
Beijing Shougang Co.,
Ltd.2022 No. 17 C, Financial
Bank of Beijing Co.,
Ultra-short-term Street, Xicheng District, Zhang Guoxia 010-66223400
Ltd.
financing note (Phase Beijing, PRC.
II) (Kechuang Note)
Beijing Shougang Co., 5F, Saite Plaza, 22
Ltd. 2023 Jianguomenwai Dajie,
Grant Thornton LLP Qian Bin, Liu Yiwei Qian Bin, Liu Yiwei 010-85665231
Ultra-short-term Chaoyang District,
financing note (Phase I) Beijing, PRC
34F, Office Building
Beijing Shougang Co.,
no.3, Huamao Center, 010-58091281
Ltd. 2023 Beijing Jingtian
77 Jianguo Road, Deng Qing, Yang Yao
Ultra-short-term Gongcheng Law Firm 010-58091048
Chaoyang District,
financing note (Phase I)
Beijing, PRC
Beijing Shougang Co., 345 Ningdong Road,
Ltd. 2023 Bank of Ningbo Co., Yinzhou District,
Hu Qiang 0574-87002735
Ultra-short-term Ltd. Ningbo, Zhejiang
financing note (Phase I) Province, PRC
Beijing Shougang Co.,
No. 17 C, Financial
Ltd. 2023 Bank of Beijing Co.,
Street, Xicheng District, Zhang Guoxia 010-66223400
Ultra-short-term Ltd.
Beijing, PRC
financing note (Phase I)
Beijing Shougang Co.,
5F, Saite Plaza, 22
Ltd. 2023
Jianguomenwai Dajie,
Ultra-short-term Grant Thornton LLP Qian Bin, Yu Qike Qian Bin, Yu Qike 010-85665231
Chaoyang District,
financing note (Phase
Beijing, PRC
II)
68
Beijing Shougang Co. Ltd Annual Report 2023
Beijing Shougang Co.,
345 Ningdong Road,
Ltd. 2023 010-58091281
Beijing Jingtian Yinzhou District,
Ultra-short-term Deng Qing, Yang Yao
Gongcheng Law Firm Ningbo, Zhejiang 010-58091048
financing note (Phase
Province, PRC
II)
Beijing Shougang Co.,
Building 2, No.1,
Ltd. 2023 Beijing Rural
Yuetan South Street, Guan Yuming, Niu
Ultra-short-term Commercial Bank Co., 010-632299793
Xicheng District, Caiping
financing note (Phase Ltd
Beijing, PRC
II)
Beijing Shougang Co.,
Ltd. 2023 25 Financial Street,
China Construction
Ultra-short-term Xicheng District, Wang Wenjun 010-67594276
Bank Co., Ltd
financing note (Phase Beijing, PRC
II)
Beijing Shougang Co.,
5F, Saite Plaza, 22
Ltd.2023
Jianguomenwai Dajie,
Ultra-short-term Grant Thornton LLP Qian Bin, Yu Qike Qian Bin, Yu Qike 010-85665231
Chaoyang District,
financing note (Phase
Beijing, PRC
III) (Kechuang Note)
Beijing Shougang Co.,
345 Ningdong Road,
Ltd.2023 010-58091281
Beijing Jingtian Yinzhou District,
Ultra-short-term Deng Qing, Yang Yao
Gongcheng Law Firm Ningbo, Zhejiang 010-58091048
financing note (Phase
Province, PRC
III) (Kechuang Note)
Beijing Shougang Co.,
Ltd.2023 No. 17 C, Financial
Bank of Beijing Co.,
Ultra-short-term Street, Xicheng District, Zhang Guoxia 010-66223400
Ltd.
financing note (Phase Beijing, PRC.
III) (Kechuang Note)
Beijing Shougang Co.,
Building 2, No.1,
Ltd.2023 Beijing Rural
Yuetan South Street, Guan Yuming, Niu
Ultra-short-term Commercial Bank Co., 010-632299793
Xicheng District, Caiping
financing note (Phase Ltd
Beijing, PRC
III) (Kechuang Note)
Change of the above intermediary organisations during the reporting period
□ Yes √ No
4. Use of proceeds
Unit: RMB0,000
Is the use of
proceeds consistent
with the use of
Rectification
Operation of special proceeds guaranteed
Total amount Utilised Unutilised of irregularities
Bond Name account for the under the
of proceeds amount amount in the use of
proceeds (if any) prospectus,
proceeds (if any)
proposed use of
proceeds and other
agreement
During the reporting
Beijing Shougang
period, the operation
Co., Ltd.2022
of the Company's
Ultra-short-term
100,000 100,000 0.00 special account for No Consistent
financing note
raised funds
(Phase II) (Kechuang
conforms to the
Note)
standard
During the reporting
Beijing Shougang period, the operation
Co., Ltd. 2023 of the Company's
Ultra-short-term 100,000 100,000 0 special account for No Consistent
financing note raised funds
(Phase I) conforms to the
standard
69
Beijing Shougang Co. Ltd Annual Report 2023
Is the use of
proceeds consistent
with the use of
Rectification
Operation of special proceeds guaranteed
Total amount Utilised Unutilised of irregularities
Bond Name account for the under the
of proceeds amount amount in the use of
proceeds (if any) prospectus,
proceeds (if any)
proposed use of
proceeds and other
agreement
During the reporting
Beijing Shougang period, the operation
Co., Ltd. 2023 of the Company's
Ultra-short-term 100,000 100,000 0 special account for No Consistent
financing note raised funds
(Phase II) conforms to the
standard
During the reporting
Beijing Shougang
period, the operation
Co., Ltd.2023
of the Company's
Ultra-short-term
100,000 100,000 0 special account for No Consistent
financing note
raised funds
(Phase III)
conforms to the
(Kechuang Note)
standard
Proceeds to be used for construction projects
□ Applicable √ Not applicable
Change in the use of proceeds from the above bonds during the reporting period
□ Applicable √ Not applicable
5. Adjustment of credit rating results during the reporting period
□ Applicable √ Not applicable
6. Implementation of and changes in guarantee, debt repayment plan and other repayment guarantee measures during the
reporting period and their impacts on the rights and interests of bond investors
□ Applicable √ Not applicable
IV. Convertible bonds
□ Applicable √ Not applicable
The Company has no convertible bonds during the reporting period.
V. The loss in the scope of the consolidated financial statements during the reporting
periodexceeding 10% of the net assets as at the end of the prior year
□ Applicable √ Not applicable
VI. Overdue interest-bearing debts other than bonds at the end of the reporting period
□ Applicable √ Not applicable
VII. Breaches of the regulations during the reporting period
□ Yes √ No
VIII. Major accounting data and financial indicators of the Company over the past two years
as at the end of the reporting period
Unit: RMB0’000
Increase/decrease as at the end
As at the end of the reporting of the reporting period as
Items As at the end of the prior year
period compared to the end of the prior
year
Current ratio 0.50 0.45 11.11%
Gearing ratio 60.43% 65.03% -4.60%
Quick ratio 0.32 0.30 6.67%
Increase/decrease of the
The corresponding period of the reporting period as compared to
The reporting period
prior year corresponding period of the
prior year
Net profit after extraordinary
52,767.21 105,251.09 -49.87%
gains or losses
70
Beijing Shougang Co. Ltd Annual Report 2023
Proportion of EBITDA to total
12.37% 12.28% 0.09%
debts
Interest coverage ratio 1.62 1.95 -16.92%
Cash interest coverage ratio 5.18 6.92 -25.14%
EBITDA interest coverage ratio 7.04 6.08 15.79%
Loans payment ratio 100.00% 100.00%
Interest payment ratio 100.00% 100.00%
71
Beijing Shougang Co. Ltd Annual Report 2023
Section X. Financial Report
(This section is translated based on the Chinese version of the full audit report of the Company. Immaterial difference may exist
beween this section in Chinese version annual report and English version annual report. The difference is due to the specific template
required by the Shenzhen Stock Exchange in Chinese version which is not applied in English version.)
Auditor’s Report
Type of audit opinion Standard unqualified opinion
Date of signing of audit report 18 April 2024
Name of audit institution Grant Thornton LLP
Number of audit report GTSZ (2024) No. 110A011630
Chinese Certified Public Accountant Qian Bin, Yu Qike
Main Body of Audit Report
To the Shareholders of Beijing Shougang Company Limited：
I. Opinion
We have audited the financial statements of Beijing Shougang Company Limited (the
Company), which are comprised of the consolidated and company statements of
financial position as of 31 December 2023, and the consolidated and company
income statements, statements of changes in equity and statements of cash flows for
the year then ended, and notes to the financial statements.
In our opinion, the accompanying financial statements present fairly, in all material
respects, the consolidated and company financial position of the Company as of 31
December 2023, and the consolidated and company’s financial performance and cash
flows for the year then ended in accordance with Accounting Standards for Business
Enterprises.
II. Basis for Opinion
We conducted our audit in accordance with China Standards on Auditing. Our
responsibilities under those standards are further described in the Auditor’s
Responsibilities for the Audit of the financial statements section of our report. We are
independent of the Company in accordance with the Code of Ethics for Chinese
Certified Public Accountants, and we fulfilled our other ethical responsibilities. We
believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These
matters were addressed in the context of our audit of the financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters.
(I) The provision for inventory impairments
72
Beijing Shougang Co. Ltd Annual Report 2023
The disclosures related to the impairment of inventories are disclosed in Notes III.13
and V.7 to the financial statements.
1. Description of the matter
As of 31 December 2023, the carry value of inventory of the Company amounted to
RMB 12.413 billion with an impairment of RMB 235 million in the consolidated
financial statements. Inventory had been regarded as the material part of the current
assets of the Company at the end of the period, and the provision for inventory
impairment referred to the application of management’s accounting estimates. Hence,
we have identified the provision for inventory impairments as a key audit matter.
According to the accounting policy of the Company, if the cost is in excess of the net
realizable value, impairment of inventories is recognized on the date of balance sheet.
Net realizable value is determined based on the estimated selling price on normal
business terms deducted by the estimated costs to completion and the related
expenses.
2. How our audit addressed the Key Audit Matter
Our main procedures in relation to provision for inventory impairment includes:
(1) Understanding and assessing the management’s internal controls related to
impairment testing of inventories, and testing the effectiveness of key control
executions.
(2) Testing, on a sample basis during the inventory monitoring procedure, observing
the inventory status and checking the inventory age
(3) Recalculating the impairment of inventories at the end of the reporting period
(4) Implementing the analysis procedure to determine whether there is a significant
difference between the estimated selling price and the market price, and examining
whether there is a significant difference between the post-period selling price and the
estimated price in conjunction with a subsequent-event audit.
(5) Evaluating the reasonableness of carrying value of the inventory as at 31
December 2023 by analyzing manufacturing costs of current inventories.
(6) Inspecting whether the related information of inventory impairments provision is
properly, appropriately and adequately presented and disclosed in the financial
statements.
(II) Recognition of Revenue
The disclosures related to the recognition of revenue are disclosed in Notes III.26 and
V.42 to the financial statements.
1. Descriptions of the matter
In 2023, the revenue was RMB 113.761 billion in the consolidated financial
statements. Considering that the revenue has a significant impacted on the financial
73
Beijing Shougang Co. Ltd Annual Report 2023
statements of the Company and steel price could exert a great influence on the profits
of the Company since the steel industry is a cyclical industry, we regarded the
recognition of revenue as a key audit matter.
2. How our audit addressed the Key Audit Matter
Our main procedures in relation to recognition of revenue includes:
(1) Understanding and assessing the management’s internal controls related to
recognition of revenue, and testing the effectiveness of key control executions.
(2) Assessing whether the revenue recognition conditions, methods and time
complied with the related standards in Accounting Standards for Business
Enterprises.
(3) Selecting revenue transaction samples, checking the supporting documents of
revenue recognition such as sales contracts, orders, delivery records, etc. to evaluate
the truthfulness of revenue recognition.
(4) Selecting major customers to perform the confirmation procedures on annual sales
to evaluate the accuracy of revenue recognition.
(5) Implementing cut-off tests on revenue recognition before and after balance sheet
date.
(6) Checking the adequacy and appropriateness of disclosures in relation to revenue
in the financial statements.
IV. Other Information
The management of the Company is responsible for the other information. The other
information comprises the information included in the Annual Report of 2023, other
than the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we
do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read
the other information and, in doing so, consider whether the other information is
materially inconsistent with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated.
Based on the work we have performed on other information we obtained before the
audit report date, if we conclude that there is material misstatement of other
information, we are required to report that fact. We have nothing to report in this
regard.
V. Responsibilities of the Management and Those Charged with Governance for
the Financial Statements
Management of the Company is responsible for the preparation and fair presentation
of the financial statements in accordance with Accounting Standards for Business
74
Beijing Shougang Co. Ltd Annual Report 2023
Enterprises, and designing, implementing and maintaining internal control as
management determines is necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the
Company’s ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless the
management either intends to liquidate the Company or to cease operations, or has no
realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s
financial reporting process.
VI. Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to fraud or
error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with China Standards on Auditing will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are
generally considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with China Standards on Auditing, we exercise
professional judgment and maintain professional skepticism throughout the audit. We
also:
(1) Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to
those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from
fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness
of accounting estimates and related disclosures made by the management.
(4) Conclude on the appropriateness of management’s use of the going concern basis
of accounting and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on
the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor’s report to the
related disclosures in the financial statements or, if such disclosures are inadequate, to
75
Beijing Shougang Co. Ltd Annual Report 2023
modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, further events or conditions may cause the
Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements,
and whether the financial statements represent the underlying transactions and events
in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of
the entities or business activities within the Company to express an opinion on the
financial statements. We are responsible for the direction, supervision and
performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters,
the planned scope and timing of the audit and significant audit findings, including
any significant deficiencies in internal control that we identify during our audit.
We also provide the governance with a statement that we have complied with relevant
ethical requirements regarding independence and to communicate with them all
relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards (if any).
From the matters communicated with the governance, we determine those matters
that were of most significance in the audit of the financial statements of the current
period and are therefore the key audit matters. We describe these matters in our
auditor’s report unless law or regulation precludes public disclosure about the matter
or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such
communication.
76
Beijing Shougang Co. Ltd Annual Report 2023
Consolidated and Parent Company Statement of Financial Position
Beijing Shougang Co., Ltd. as at 31 December 2023
Unit: RMB Yuan
31 December 2023 31 December 2022
Item Notes
Consolidated Company Consolidated Company
Current assets:
Cash at bank and on hand V. 1 9,153,205,626.37 1,806,064,978.27 9,470,472,522.05 1,973,471,254.47
Notes receivable V. 2 3,958,135,183.83 825,606,179.97 6,691,086,020.85 898,640,149.83
Accounts receivable V. 3 1,365,633,725.20 1,433,327,640.47 1,450,008,897.10 1,396,660,925.53
Financing receivables V. 4 2,223,431,426.46 823,200,805.55 3,489,134,871.56 835,526,685.55
Prepayments V. 5 2,111,891,544.80 534,795,080.00 636,469,216.98 326,340,746.62
Other receivables V. 6 9,509,909.78 136,314,481.16 13,168,697.56 1,163,994,995.68
Including: Interest receivable
Dividends receivable 2,407,634.67 200,000.00 9,713,244.06
Inventories V. 7 12,177,610,585.90 1,967,980,821.94 11,960,246,748.15 1,904,197,806.47
Other current assets V. 8 1,529,327,917.77 720,044,580.92 1,025,942,949.49 565,959,166.92
Total current assets 32,528,745,920.11 8,247,334,568.28 34,736,529,923.74 9,064,791,731.07
Non-current assets:
Long-term equity investments V. 9 2,420,775,096.36 37,020,179,840.15 2,724,285,925.35 37,687,890,460.88
Other equity instruments investments V. 10 340,204,092.21 340,204,092.21 232,766,133.81 232,766,133.81
Other non-current financial assets V. 11 75,009,218.61 75,009,218.61 79,234,007.60 79,234,007.60
Investment properties
Fixed assets V. 12 89,895,037,102.17 18,294,054,760.24 93,331,072,969.17 19,254,378,866.41
Construction in progress V. 13 5,320,613,251.88 2,096,054,577.18 7,673,649,852.77 1,490,601,326.57
Right-of-use assets V. 14 489,044,162.56 18,009,629.54 83,107,359.45 27,014,444.30
Intangible assets V. 15 6,004,370,080.22 1,650,621,035.40 3,906,907,128.11 1,702,786,981.19
Development expenditures
Goodwill
Long-term prepaid expenses V. 16 4,791,419.09 3,535,748.04
Deferred tax assets V. 17 441,070,785.12 191,520,829.30 402,355,955.31 205,022,924.46
Other non-current assets
Total non-current assets 104,990,915,208.22 59,685,653,982.63 108,436,915,079.61 60,679,695,145.22
Total assets 137,519,661,128.33 67,932,988,550.91 143,173,445,003.35 69,744,486,876.29
77
Beijing Shougang Co. Ltd Annual Report 2023
Consolidated and Parent Company Statement of Financial Position (Continued)
Beijing Shougang Co., Ltd. as at 31 December 2023
Unit: RMB Yuan
31 December 2023 31 December 2022
Item Notes
Consolidated Consolidated Consolidated Company
Current liabilities:
Short-term borrowings V. 19 26,661,355,641.29 9,697,875,763.85 29,580,006,103.39 10,586,336,291.69
Notes payable V. 20 3,433,752,366.00 50,000,000.00 7,261,510,000.00 989,500,000.00
Accounts payable V. 21 20,734,040,709.58 9,850,290,958.06 19,810,594,484.05 9,833,463,235.41
Receipts in advance
Contract liabilities V. 22 4,699,449,813.28 1,036,301,337.72 4,508,016,725.74 521,402,199.01
Employee benefits payable V. 23 762,360,797.04 278,758,236.87 620,796,429.60 207,863,353.07
Taxes payable V. 24 184,929,853.68 30,265,576.48 172,300,416.40 22,570,197.17
Other payables V. 25 431,690,700.91 218,440,824.20 2,761,819,276.69 1,100,551,048.35
Including: Interest payable
Dividend payable 11,440,046.38
Liabilities classified as held for sale
Current portion of non-current liabilities V. 26 1,337,686,760.50 513,180,977.19 4,038,768,022.60 3,419,903,869.77
Other current liabilities V. 27 6,207,392,240.67 2,016,969,625.15 8,088,749,910.74 1,927,653,981.82
Total current liabilities 64,452,658,882.95 23,692,083,299.52 76,842,561,369.21 28,609,244,176.29
Non-current liabilities:
Long-term borrowings V. 28 12,789,060,000.00 3,946,830,000.00 10,594,350,000.00 1,267,120,000.00
Bonds payable V. 29
Lease liabilities V. 30 471,745,760.35 9,850,828.20 72,439,836.79 19,284,063.32
Long-term payable V. 31 2,300,000.00 2,300,000.00 2,300,000.00 2,300,000.00
Long-term payroll and employee benefits V. 32 77,050,280.88 77,050,280.88 82,565,651.02 82,565,651.02
Provisions
Deferred income V. 33 852,384,301.36 99,843,517.79 472,861,881.90 85,269,577.62
Deferred tax liabilities V. 17 554,522,851.81 359,787,326.79 502,268,362.26 365,393,047.63
Other non-current liabilities V. 34 3,899,674,951.80 4,532,018,467.20
Total non-current liabilities 18,646,738,146.20 4,495,661,953.66 16,258,804,199.17 1,821,932,339.59
Total liabilities 83,099,397,029.15 28,187,745,253.18 93,101,365,568.38 30,431,176,515.88
Shareholders’equity：
Share capital V. 35 7,794,611,605.00 7,794,611,605.00 7,819,869,170.00 7,819,869,170.00
Capital reserve V. 36 30,359,081,190.35 22,108,845,278.76 29,644,048,551.50 22,176,353,536.77
Less: treasury shares V. 37 130,627,194.09 130,627,194.09 210,930,850.00 210,930,850.00
Other comprehensive income V. 38 249,573,973.65 249,574,039.56 158,251,774.94 158,251,774.94
Special reserve V. 39 32,813,410.14 31,852,310.79
Surplus reserve V. 40 1,944,190,492.65 1,944,190,492.65 1,908,883,208.67 1,908,883,208.67
Retained earnings V. 41 9,224,145,934.95 7,778,649,075.85 8,595,698,699.52 7,460,883,520.03
Equity attributable to shareholders of the Company 49,473,789,412.65 39,745,243,297.73 47,947,672,865.42 39,313,310,360.41
Non-controlling interests 4,946,474,686.53 2,124,406,569.55
Total shareholders' equity 54,420,264,099.18 39,745,243,297.73 50,072,079,434.97 39,313,310,360.41
Total liabilities and shareholders' equity 137,519,661,128.33 67,932,988,550.91 143,173,445,003.35 69,744,486,876.29
78
Beijing Shougang Co. Ltd Annual Report 2023
Consolidated and Parent Company Income Statement
Beijing Shougang Co., Ltd. for the year ended 31 December 2023
Unit: RMB Yuan
Item 2023 2022
Notes
Consolidated Company Consolidated Company
I. Operating revenue V. 42 113,761,443,633.43 38,926,306,222.11 118,142,183,549.47 39,004,809,105.09
Less: Cost of sales V. 42 108,450,939,228.35 37,636,422,870.72 111,067,555,320.28 38,195,755,653.87
Taxes and surcharges V. 43 773,788,277.52 186,759,975.87 823,261,082.93 215,684,348.68
Selling expenses V. 44 247,978,613.12 145,715,400.04 237,997,026.22 147,362,228.16
General and administrative expenses V. 45 1,289,613,009.53 511,892,492.19 1,271,175,739.06 533,105,120.91
R&D expenses V. 46 491,078,795.33 188,022,863.16 626,923,257.36 207,810,181.56
Financial expenses V. 47 1,353,210,253.87 412,626,659.67 1,731,584,291.35 460,293,091.81
Including: Interest expense 1,459,986,955.71 472,742,471.44 1,863,709,861.13 507,359,008.32
Interest income 107,859,174.95 16,560,676.53 132,829,545.65 27,521,639.77
Add: Other income V. 48 497,165,799.61 192,257,211.40 76,142,005.96 11,800,586.33
Investment gain/ (loss) V. 49 -173,640,314.78 468,027,906.62 -211,209,023.35 59,234,973.72
Including: Share of profits or loss of associates and joint ventures -192,776,595.40 -132,155,436.66 -227,515,854.43 -178,256,786.93
Gain/ (loss) on the changes in fair value V. 50 -4,224,788.99 -4,224,788.99 -765,992.40 -765,992.40
Credit impairment losses V. 51 48,197,342.07 8,342,561.87 5,643,463.88 337,922.33
Assets impairment losses V. 52 -600,099,065.24 -151,383,222.76 -402,994,496.88 -63,210,278.38
Gain/ (loss) from disposal of assets V. 53 567,839.38 5,475,499.08 -611,088.11 -611,088.11
II. Operating profit/ (loss) 922,802,267.76 363,361,127.68 1,849,891,701.37 -748,415,396.41
Add: Non-operating income V. 54 6,975,486.44 1,803,907.74 11,304,199.78 4,718,009.36
Less: Non-operating expenses V. 55 29,457,854.70 20,311,515.08 68,082,023.32 51,970,642.22
III. Profit/ (loss) before tax 900,319,899.50 344,853,520.34 1,793,113,877.83 -795,668,029.27
Less: Income tax expense V. 56 146,515,055.29 -8,219,319.46 283,698,478.31 -6,832,474.51
IV. Net profit / (loss) 753,804,844.21 353,072,839.80 1,509,415,399.52 -788,835,554.76
(1) Categorized by operation continuity:
Including: Net profit/ (loss) from continuing operations 753,804,844.21 353,072,839.80 1,509,415,399.52 -788,835,554.76
Net profit/ (loss) from discontinuing operations
(2) Categorized by ownership:
Including: Net profit/ (loss) attributable to shareholders of the Company 663,754,519.41 1,124,540,659.14
Net profit/ (loss) attributable to non-controlling interests 90,050,324.80 384,874,740.38
V. Other comprehensive income, net of tax 91,322,198.71 91,322,264.62 -27,314,435.65 -27,314,435.65
Other comprehensive income, net of tax, attributable to shareholders of
91,322,198.71 91,322,264.62 -27,314,435.65 -27,314,435.65
the company
(1) Other comprehensive income that will not be reclassified to profit or
91,322,264.62 91,322,264.62 -27,314,435.65 -27,314,435.65
loss
Changes in fair value of other equity instrument investments 91,322,264.62 91,322,264.62 -27,314,435.65 -27,314,435.65
(2) Other comprehensive income to be reclassified to profit or loss -65.91
Foreign currency translation differences -65.91
Other comprehensive income, net of tax, attributable to non-controlling interests
VI. Total comprehensive income 845,127,042.92 444,395,104.42 1,482,100,963.87 -816,149,990.41
Total comprehensive income attributable to shareholders of the company 755,076,718.12 1,097,226,223.49
Total comprehensive income attributable to non-controlling interests 90,050,324.80 384,874,740.38
VII. Earnings per share
(1) Basic earnings per share 0.0856 0.1496
(2) Diluted earnings per share
79
Beijing Shougang Co. Ltd Annual Report 2023
Consolidated and Parent Company Statement of Cash Flows
Beijing Shougang Co., Ltd. for the year ended 31 December 2023
Unit: RMB Yuan
2023 2022
Items Note
Consolidated Company Consolidated Company
I. Cash flows from operating activities
Cash receipts from the sale of goods and the rendering of services 64,299,847,202.27 20,828,679,035.96 60,167,389,548.82 16,484,868,626.13
Tax refunds received 123,551,111.37 9,607,663.70 189,506,469.09 42,188,257.67
Cash received relating to other operating activities V. 57 1,075,599,962.13 522,648,828.19 767,214,052.71 20,415,777.73
Sub-total of cash inflows 65,498,998,275.77 21,360,935,527.85 61,124,110,070.62 16,547,472,661.53
Cash paid for purchase of goods and services 51,471,616,413.84 18,321,312,770.37 43,094,229,128.26 11,560,257,021.52
Cash paid to and on behalf of employee 4,527,216,997.76 1,506,335,099.63 4,581,065,361.90 1,542,021,128.22
Cash paid for taxes 2,863,616,678.56 810,940,804.12 3,011,630,025.15 471,766,716.43
Cash paid relating to other operating activities V. 57 482,242,113.79 133,600,503.19 392,950,057.51 200,956,450.23
Sub-total of cash outflows 59,344,692,203.95 20,772,189,177.31 51,079,874,572.82 13,775,001,316.40
Net cash flows from operating activities 6,154,306,071.82 588,746,350.54 10,044,235,497.80 2,772,471,345.13
II. Cash flows from investing activities
Cash received from disposal of investments 1,260,401,500.00 702,413,695.89 38,609,883.16
Cash received from investment income 115,230,658.40 591,297,147.99 82,626,235.37 242,968,827.72
Net proceeds from disposal of property, plant and equipment, intangible assets and other
4,617,334.55 8,667,874.82 12,405,207.57 9,996,517.46
long-term assets
Cash received from disposal of subsidiaries and other business units
Cash received relating to other investing activities V. 57 106,533,297.74 16,548,922.08 132,789,335.69 28,160,581.65
Sub-total of cash inflows 1,486,782,790.69 1,318,927,640.78 266,430,661.79 281,125,926.83
Purchase of property, plant and equipment, intangible assets and other non-current assets 1,766,380,951.48 302,621,704.63 2,639,013,873.80 493,955,501.86
Cash paid for investments 662,474,008.68 650,162,899.68 789,480,592.71 781,780,592.71
Net cash paid for acquisition of a subsidiary and other operating units
Cash paid relating to other investing activities 153,910,000.00
Sub-total of cash outflows 2,428,854,960.16 952,784,604.31 3,428,494,466.51 1,429,646,094.57
Net cash flows from investing activities -942,072,169.47 366,143,036.47 -3,162,063,804.72 -1,148,520,167.74
III. Cash flows from financing activities
Cash received from investment 1,565,806,677.81 1,278,391,712.18 287,603,983.82
Including: Cash receipts from capital contributions from non-controlling interests of
1,565,806,677.81 990,787,728.36
subsidiaries
Proceeds from borrowings 31,847,552,691.12 13,583,351,200.88 33,162,321,539.41 13,549,741,539.41
Proceeds from issuing bonds 3,000,000,000.00 3,000,000,000.00 2,000,000,000.00 2,000,000,000.00
Cash receipts relating to other financing activities 1,039,800,000.00
Sub-total of cash inflows 36,413,359,368.93 17,623,151,200.88 36,440,713,251.59 15,837,345,523.23
Repayments for debts 38,229,681,200.88 17,654,331,200.88 40,872,794,754.59 15,706,004,754.59
Cash payments for distribution of dividends or profit and interest expenses 1,731,838,601.55 490,762,007.33 2,519,777,625.43 1,150,312,727.17
Including: Dividends or profits paid to non-controlling shareholders of subsidiaries 245,520,943.15 45,895,343.51
Cash payments relating to other financing activities V. 57 1,088,617,421.92 91,365,753.67 136,968,934.05 163,699,124.52
Sub-total of cash outflows 41,050,137,224.35 18,236,458,961.88 43,529,541,314.07 17,020,016,606.28
Net cash flows from financing activities -4,636,777,855.42 -613,307,761.00 -7,088,828,062.48 -1,182,671,083.05
IV. Effect of exchange rate changes on cash and cash equivalents -10,372.53
V. Net increase in cash and cash equivalents 575,445,674.40 341,581,626.01 -206,656,369.40 441,280,094.34
Add: Cash and cash equivalents as at the beginning of year 8,329,215,003.68 1,464,146,635.34 8,535,871,373.08 1,022,866,541.00
VI. Cash and cash equivalent as at the end of year 8,904,660,678.08 1,805,728,261.35 8,329,215,003.68 1,464,146,635.34
80
Beijing Shougang Co. Ltd Annual Report 2023
Consolidated Statement of Changes in Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2023
Unit: RMB Yuan
2023
Item Equity attributable to shareholders of the parent
Non-controlling Total shareholders’
Other interests equity
Less: treasury
Share capital Capital reserve comprehensive Special reserve Surplus reserve Retained earnings
shares
income
I. Balance at the end of previous
7,819,869,170.00 29,644,048,551.50 210,930,850.00 158,251,774.94 31,852,310.79 1,908,883,208.67 8,595,698,699.52 2,124,406,569.55 50,072,079,434.97
year
Add: Changes in accounting policies
Corrections of prior period
errors
Others
II. Balance at the beginning of the
7,819,869,170.00 29,644,048,551.50 210,930,850.00 158,251,774.94 31,852,310.79 1,908,883,208.67 8,595,698,699.52 2,124,406,569.55 50,072,079,434.97
year
III. Increase/(decrease) during the
-25,257,565.00 715,032,638.85 -80,303,655.91 91,322,198.71 961,099.35 35,307,283.98 628,447,235.43 2,822,068,116.98 4,348,184,664.21
period
(1)Total comprehensive income 91,322,198.71 663,754,519.41 90,050,324.80 845,127,042.92
(2)Shareholders' contributions
-25,257,565.00 714,657,637.11 -80,303,655.91 2,969,269,451.03 3,738,973,179.05
and reduction
(i) Shareholders’ contributions
-25,257,565.00 -55,046,090.91 -80,303,655.91 2,969,269,451.03 2,969,269,451.03
in ordinary share
(ii) Amount of share-based
-11,692,261.51 -11,692,261.51
payments recognized in equity
(iii) Others 781,395,989.53 781,395,989.53
(3) Profit distribution 35,307,283.98 -35,307,283.98 -234,080,896.77 -234,080,896.77
(i) Transfer to surplus reserve 35,307,283.98 -35,307,283.98
(ii) Distribution to shareholders -234,080,896.77 -234,080,896.77
(iii) Others
(4) Transfer within equity
(i) Capital reserves converted to
share capital
(ii) Surplus reserves converted
to share capital
(iii) Loss made up by surplus
reserves
(iv) Other comprehensive
income transferred to retained
earnings
(v) Others
(5) Special reserve 375,001.74 961,099.35 -3,170,762.08 -1,834,660.99
(i) Additions 375,001.74 961,099.35 -3,170,762.08 -1,834,660.99
(ii) Utilisation
(6) Others
IV. Balance at the end of the year 7,794,611,605.00 30,359,081,190.35 130,627,194.09 249,573,973.65 32,813,410.14 1,944,190,492.65 9,224,145,934.95 4,946,474,686.53 54,420,264,099.18
81
Beijing Shougang Co. Ltd Annual Report 2023
Consolidated Statement of Changes in Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2023
Unit: RMB Yuan
2022
Item Equity attributable to shareholders of the parent
Total shareholders’
Non-controlling interests
Other equity
Less: treasury Special
Share capital Capital reserve comprehensive Surplus reserve Retained earnings
shares reserve
income
I. Balance at the end of previous
6,750,325,410.00 24,861,776,641.72 210,930,850.00 185,566,210.59 21,054,371.78 1,908,883,208.67 8,130,868,205.38 7,348,614,099.26 48,996,157,297.40
year
Add: Changes in accounting policies
Corrections of prior period
errors
Others
II. Balance at the beginning of the
6,750,325,410.00 24,861,776,641.72 210,930,850.00 185,566,210.59 21,054,371.78 1,908,883,208.67 8,130,868,205.38 7,348,614,099.26 48,996,157,297.40
year
III. Increase/(decrease) during the
1,069,543,760.00 4,782,271,909.78 -27,314,435.65 10,797,939.01 464,830,494.14 -5,224,207,529.71 1,075,922,137.57
period
(1)Total comprehensive income -27,314,435.65 1,124,540,659.14 384,874,740.38 1,482,100,963.87
(2)Shareholders' contributions
1,069,543,760.00 4,795,867,598.63 -5,544,665,254.82 320,746,103.81
and reduction
(i) Shareholders’ contributions
1,069,543,760.00 4,738,436,210.82 -5,544,665,254.82 263,314,716.00
in ordinary share
(ii) Amount of share-based
36,147,743.13 36,147,743.13
payments recognized in equity
(iii) Others 21,283,644.68 21,283,644.68
(3) Profit distribution -659,710,165.00 -57,585,389.89 -717,295,554.89
(i) Transfer to surplus reserve
(ii) Distribution to shareholders -625,589,533.60 -57,585,389.89 -683,174,923.49
(iii) Others -34,120,631.40 -34,120,631.40
(4) Transfer within equity
(i) Capital reserves converted to
share capital
(ii) Surplus reserves converted
to share capital
(iii) Loss made up by surplus
reserves
(iv) Other comprehensive
income transferred to retained
earnings
(v) Others
(5) Special reserve 7,687,955.83 10,797,939.01 -6,831,625.38 11,654,269.46
(i) Additions 7,687,955.83 10,797,939.01 -6,831,625.38 11,654,269.46
(ii) Utilisation
(6) Others -21,283,644.68 -21,283,644.68
IV. Balance at the end of the year 7,819,869,170.00 29,644,048,551.50 210,930,850.00 158,251,774.94 31,852,310.79 1,908,883,208.67 8,595,698,699.52 2,124,406,569.55 50,072,079,434.97
82
Beijing Shougang Co. Ltd Annual Report 2023
Parent Company Statement of Changes in Shareholders’ Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2023
Unit: RMB Yuan
2023
Item
Other Total shareholders’
Less: treasury
Share capital Capital reserve comprehensive Special reserve Surplus reserve Retained earnings
shares equity
income
I. Balance at the end of previous year 7,819,869,170.00 22,176,353,536.77 210,930,850.00 158,251,774.94 1,908,883,208.67 7,460,883,520.03 39,313,310,360.41
Add: Changes in accounting policies
Corrections of prior period errors
Others
II. Balance at the beginning of the year 7,819,869,170.00 22,176,353,536.77 210,930,850.00 158,251,774.94 1,908,883,208.67 7,460,883,520.03 39,313,310,360.41
III. Increase/(decrease) during the period -25,257,565.00 -67,508,258.01 -80,303,655.91 91,322,264.62 35,307,283.98 317,765,555.82 431,932,937.32
(1) Total comprehensive income 91,322,264.62 353,072,839.80 444,395,104.42
(2) Shareholders' contributions and reduction -25,257,565.00 -67,508,258.01 -80,303,655.91 -12,462,167.10
(i) Shareholders’ contributions in ordinary
-25,257,565.00 -55,046,090.91 -80,303,655.91
share
(ii) Amount of share-based payments
-12,462,167.10 -12,462,167.10
recognized in equity
(iii) Others
(3) Profit distribution 35,307,283.98 -35,307,283.98
(i) Transfer to surplus reserve 35,307,283.98 -35,307,283.98
(ii) Distribution to shareholders
(iii) Others
(4) Transfer within equity
(i) Capital reserves converted to share capital
(ii) Surplus reserves converted to share
capital
(iii) Loss made up by surplus reserves
(iv) Other comprehensive income transferred
to retained earnings
(v) Others
(5) Special reserve
(i) Additions
(ii) Utilisation
(6) Others
IV. Balance at the end of the year 7,794,611,605.00 22,108,845,278.76 130,627,194.09 249,574,039.56 1,944,190,492.65 7,778,649,075.85 39,745,243,297.73
83
Beijing Shougang Co. Ltd Annual Report 2023
Parent Company Statement of Changes in Shareholders’ Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2023
Unit: RMB Yuan
2022
Item
Other Total shareholders’
Less: treasury
Share capital Capital reserve comprehensive Special reserve Surplus reserve Retained earnings
shares equity
income
I. Balance at the end of previous year 6,750,325,410.00 17,070,281,351.14 210,930,850.00 185,566,210.59 1,908,883,208.67 8,909,429,239.79 34,613,554,570.19
Add: Changes in accounting policies
Corrections of prior period errors
Others
II. Balance at the beginning of the year 6,750,325,410.00 17,070,281,351.14 210,930,850.00 185,566,210.59 1,908,883,208.67 8,909,429,239.79 34,613,554,570.19
III. Increase/(decrease) during the period 1,069,543,760.00 5,106,072,185.63 -27,314,435.65 -1,448,545,719.76 4,699,755,790.22
(1) Total comprehensive income -27,314,435.65 -788,835,554.76 -816,149,990.41
(2) Shareholders' contributions and reduction 1,069,543,760.00 5,127,355,830.31 6,196,899,590.31
(i) Shareholders’ contributions in ordinary
1,069,543,760.00 5,062,782,685.03 6,132,326,445.03
share
(ii) Amount of share-based payments
43,289,500.60 43,289,500.60
recognized in equity
(iii) Others 21,283,644.68 21,283,644.68
(3) Profit distribution -659,710,165.00 -659,710,165.00
(i) Transfer to surplus reserve
(ii) Distribution to shareholders -625,589,533.60 -625,589,533.60
(iii) Others -34,120,631.40 -34,120,631.40
(4) Transfer within equity
(i) Capital reserves converted to share capital
(ii) Surplus reserves converted to share
capital
(iii) Loss made up by surplus reserves
(iv) Other comprehensive income transferred
to retained earnings
(v) Others
(5) Special reserve
(i) Additions
(ii) Utilisation
(6) Others -21,283,644.68 -21,283,644.68
IV. Balance at the end of the year 7,819,869,170.00 22,176,353,536.77 210,930,850.00 158,251,774.94 1,908,883,208.67 7,460,883,520.03 39,313,310,360.41
84
Beijing Shougang Co. Ltd Annual Report 2023
Notes to the Financial Statements
I. General Informantion of the Company
Beijing Shougang Co., Ltd. (hereinafter referred to as the Company) is a limited liability company
established solely by Shougang Group Co., Ltd. through fundraising and with the approval of
Beijing Municipal Government's Jingzheng Letter [1998] No. 34. The Company was approved and
registered by the Beijing Administration for Industry and Commerce on October 15, 1999, with a
unified social credit code of 91110007002343182. The registered address is Shijingshan Road,
Shijingshan District, Beijing.
After years of equity changes such as issuing new shares, as of December 31, 2023, the cumulative
total issued share capital of the Company is 7,794,611,605 shares. Among them, there are
6,013,305,341 unrestricted RMB ordinary shares and 1,781,306,264 restricted RMB ordinary
shares.
The Company and its subsidiaries are mainly engaged in the production and sales of steel products
and by-products.
This financial statement and its notes have been approved by the 7th meeting of the 8th Board of
Directors of the Company on April 18, 2024.
II. Basis of preparation
The financial statements are prepared in accordance with the latest “China Accounting Standards
for Business Enterprises” and other issued application guidance, interpretations and other related
regulations (collectively known as the “CASBE”) issued by the Ministry of Finance of the PRC
(MOF). In addition, the Company also discloses relevant financial information in accordance with
the General Provisions on Financial Reporting (Revised in 2023) of the Compilation Rules for
Information Disclosure of Companies Issuing Securities to the Public No. 15 of the China Securities
Regulatory Commission.
The financial statements are prepared on a going concern basis.
The Company adopts the accrual basis of accounting. The financial statements have been prepared
under the historical cost convention, except for certain financial instruments. If the assets are
impaired, corresponding provisions for impairment shall be made in accordance with related
regulations.
III. Significant accounting policies and estimates
The Company has determined the accounting policies and accounting estimates based on the
characteristics of the operation, especially those related to depreciation of fixed assets, construction
in progress converted to fixed assets, amortization of intangible assets, capitalization conditions of
R&D expenses and revenue recognition policies, the detailed accounting policies refer to Note III.
15, Note III. 16, Note III. 19, Note III. 20 and Note III. 26.
1. Statement of compliance with the CAS
The financial statements have been prepared in accordance with CAS, and present truly and
completely the financial position of the consolidated and the Company as at 31 December 2023,
and the financial performance and cash flows for FY 2023.
85
Beijing Shougang Co. Ltd Annual Report 2023
2. Accounting period
The accounting year of the Company is from 1 January to 31 Decemeber of each calendar year.
3. Operating cycle
The operating cycle of the Company is 12 months.
4. Functional currency
The Company and domestic subsidiaries use Renminbi (“RMB”) as functional currency. The
overseas subsidiaries use the currency of the main economic environment in which the business
operate as the functional currency.
The financial statements of the Company have been prepared in RMB.
5. Method for determination and selection criteria of the materiality level
Item Materiality Level
Material accounts receivable with individual
≥RMB 10 million
provision for bad debts
Material accounts receivable written off
≥RMB 10 million
during current period
1% of the latest audited net assets attributable to the
Material construction in progress
parent company
Single contribution amount exceeding 500 million
Material non wholly-owned subsidiary
yuan (inclusive)
1% of the latest audited net assets attributable to the
Material investing activities
parent company
6. Accounting treatments for business combination involving entities under common control and
business combination involving entities not under common control.
(1) Business combination involving entities under common control
For the business combination involving entities under common control, the assets and liabilities that
are obtained in the business combination shall be measured at original carrying amounts at the
combination date as recorded by the party being combined. The difference between the carrying
amount of the net assets obtained and the carrying amount of consideration paid for the combination
shall be adjusted to capital reserve (equity premium), if the capital reserve (equity premium) is not
sufficient to absorb the difference, any excess shall be adjusted to retained earnings.
Business combinations involving entities under common control through multiple transactions to
achieve in stages
In the consolidated financial statements, the assets and liabilities obtained at the combination shall
be measured at the carrying value as recorded by the ultimate controlling party at the acquisition
date. The difference between the sum of the carrying value from original shareholding portion and
the new consideration incurred at the acquisition date and the carrying value of net assets obtained
at acquisition date shall be adjusted to capital reserve (equity premium), if the balance of capital
reserve is not sufficient to absorb the differences, any excess is adjusted to retained earnings. The
86
Beijing Shougang Co. Ltd Annual Report 2023
long-term investment held by combining party before acquisition of control, the profit or loss,
comprehensive income and other change of shareholder’s equity recongnized at the closer date of
the acquisition date and combination date under common control shall separately offset the opening
balance of retained earnings and profit or loss during comparative statements.
(2) Business combinations involving entities not under common control
For business combinations involving entities not under common control, the consideration costs
include acquisition-date fair value of assets transferred, liabilities incurred or assumed and equity
securities issued by the acquirer in exchange for control of the acquiree. The acquirer shall
recognize the acquiree’s identifiable asset, liabilities and contingent liabilities that satisfy the
recognition criteria at fair values at the date of acquisition.
The excess of combination costs and the acquirer’s interest in the fair value of the acquiree’s
identifiable net assets is recognized as goodwill, which is measured at cost less any accumulated
impairment losses subsequently. If the acquirer’s interest in the net fair value of the acquiree’s
identifiable net assets exceeds the combination costs, the acquirer shall reassess the measurement
and recognize any excess remaining in profit or loss after reassessment.
Business combinations involving entities not under common control through multiple transactions
to achieve in stages
In the consolidated financial statements, the combination cost is the sum of consideration paid at
acquisition date and fair value of the acquiree’s equity held prior to acquisition date; the equity of
the acquiree held prior to acquisition date shall be re-measured at the fair value at acquisition date,
the difference between the fair value and book value shall be recognized as investment gain or loss
for the current period. Other comprehensive income and changes of other shareholder’s equity
related with acquiree’s equity held prior to acquisition date shall be transferred to profit or loss for
current period at acquisition date, besides the other comprehensive income arising from the
remeasurement of net liabilities or changes in net assets of the defined benefit plan by the invested
party, as well as other comprehensive income related to non trading equity instrument investments
originally designated to be measured at fair value through other comprehensive income.
(3) Transaction costs for business combination
The overheads for the business combination, including the expenses of audit, legal services,
valuation advisory, and other related administrative expenses, are recorded in profit or loss for the
current period when expenditure incurred. The transaction costs of equity or debt securities issued
as the considerations of business combination are included in the initial recognition amount of the
equity or debt securities.
7. Critiria of control and method of preparing consolidated financial statements
(1) Critiria of control
The consolidation scope of the consolidated financial statements is determined based on control.
Control refers to the company having the power over the invested entity, enjoying variable returns
through participating in related activities of the invested entity, and having the ability to use the
power over the invested entity to influence its return amount. When changes in relevant facts and
circumstances result in changes in the relevant elements involved in the definition of control, the
Company will conduct a reassessment.
87
Beijing Shougang Co. Ltd Annual Report 2023
When determining whether to include a structured entity in the scope of consolidation, the
Company takes into account all facts and circumstances, including evaluating the purpose and
design of the establishment of the structured entity, identifying the types of variable returns, and
evaluating whether to control the structured entity by participating in its related activities and
assuming some or all of the variability of returns.
(2) Scope of consolidated financial statements
The scope of consolidated financial statements is determined on the control basis. Control exists
when the Company has power over the investee, rights to variable returns from involvement with
related activities of investee and has the ability to affect its returns through its power over the
investee. A subsidiary is an entity that is controlled by the Company (including separable parts of an
enterprise or investee and structured entities controlled by the Company, etc).
(2) Method of preparing consolidated financial statements
The consolidated financial statements are based on the financial statements of the Company and its
subsidiaries, and are prepared by the Company in accordance with other relevant information. In
preparing the consolidated financial statements, the Company and its subsidiaries are required to
apply consistent accounting policy and accounting period, intra-group transactions and balances
shall be offset.
The subsidiary acquired through a business combination involving entities under common control
in the reporting period shall be included in the scope of the consolidation from the beginning of the
combination date, the subsidiary’s income, expenses and profits should be included in the
consolidated results of operations and cash flows from the acquisition date respectively.
The subsidiary acquired through a business combination involving entities not under common
control in the reporting period, the subsidiary’s income, expenses and profits are included in the
consolidated results of operations, and cash flows are included in the consolidated cash flow
statement from the acquisition date to the end of the reporting date.
The portion of the subsidiary’s equity that is not attributable to the Company is treated as
non-controlling interests and separately presented in the consolidated balance sheet within
shareholders’ equity. The portion of a subsidiary’s profit or loss that is attributable to
non-controlling interests presented in the consolidated income statement of net profit or loss as “net
profit attributable to non-controlling interests”. Where the amout of losses of a subsidiary
attributable to the non-controlling shareholders in the current period exceeds the share of the
opening balance of owner’s equity of the subsidiary, the excess shall offset non-controlling
interests.
(3) Purchase of the minority equity in the subsidiary
The difference between the long-term equity investments costs acquired by the purchase of minority
equity and the share of the net assets that the subsidiaries have to continue to calculate from the date
of purchase or the date of consolidation in proportion to the new shareholding ratio is adjusted to
the capital reserve (equity premium), if the capital reserve is not sufficient, any excess is adjusted to
retained earning. The difference between disposal of partial equity investment without losing
88
Beijing Shougang Co. Ltd Annual Report 2023
control over its subsidiary and the disposal of long-term equity investment corresponding to the
share of the net assets of the subsidiaries from the date of purchase or the date of consolidation is as
well.
(4) Loss of control of subsidiaries
If the control right is lost due to disposal of partial equity investment or other reasons, the
remaining equity shall be re-measured according to its fair value on the date of losing control. The
difference between the summary of consideration obtained from the disposal of the equity and the
fair value of the remaining equity, less the difference between the share of the original assets and
the share of the net assets that have been continuously calculated from the date of purchase from the
date of the original shareholding, is included in the current period profit or loss and; if there is a
goodwill for the subsidiary, the amount of the goodwill also shall be deducted.
Other comprehensive income related to equity investments in the original subsidiary should be
accounted for on the same basis as the direct disposal of related assets or liabilities by the original
subsidiary when control is lost. Other changes in other shareholders' equity related to the original
subsidiary should be transferred to the current period's profit and loss when control is lost.
(5) Treatment of step disposal until the loss of control of subsidiaries
By stepping through multiple transactions to dispose of the equity investment in the subsidiary until
it loses control, if the clauses, conditions and economic impacts of the transaction satisfy one or
more of the following criteria, the Company will consider the transactions as a package transaction
for the accounting treatment:
①The transactions are entered simultaneously or in consideration of the mutual influence;
②Only the transactions as a whole can achieve one complete business outcome;
③The occurrence of a transaction is depending on the occurance of at least one of other
transactions;
④The transaction alone is not economical, however, it becomes economical to consider the other
transactions together.
In the consolidated financial statements, the measurement of the remaining equity and treatment of
the loss of disposal is in accordance to “Treatment of loss of control of subsidiaries” as described
above. The difference between the disposal consideration and the related share of net assets of the
subsidiaries, which has been continuously calculated since the purchase date corresponding to the
equity disposal should be treated as follows:
①When it is a package transaction, the difference shall be recognized as the other comprehensive
income and transferred to the current period profit or loss of control when the control is lost
②When it is not a package transaction, the difference shall be recorded to capital reserve (share
premium) as equity transaction and could not be transferred to the current period profit or loss of
control when the control is lost.
8. Joint arrangement and joint operations
Joint arrangement refers to an arrangement under the joint control of two or more entities. The joint
89
Beijing Shougang Co. Ltd Annual Report 2023
arrangement of the Company is classified as either a joint operation or a joint venture.
(1) Joint operation
Joint operation is a joint arrangement whereby the Company have rights to the assets, and
obligations for the liabilities, relating to the arrangement.
The Company recognizes the following items in relation to its interest in a joint operation in
accordance with CAS:
A. its solely-held assets, and its share of any assets held jointly;
B. its solely-assumed liabilities, and its share of any liabilities incurred jointly;
C. its revenue from the sale of its share of the output arising from the joint operation;
D. its share of the revenue from the sale of the output by the joint operation;
E. its solely-incurred expenses, and its share of any expenses incurred jointly.
(2) Joint venture
A joint venture is a type of joint arrangement whereby the Company that has joint control of the
arrangement has rights to the net assets of the joint venture.
The Company conducts accounting treatment for the investment of joint ventures in accordance
with the provisions of equity method accounting related to long-term equity investment.
9. Cash and cash equivalents
Cash represents the cash on hand and deposits which are readily available for payment. Cash
equivalents represent the Company’s short-term highly liquid investments which are readily
convertible into known amounts of cash and subject to an insignificant risk of changes in value.
10. Foreign currency transactions and foreign currency statement translation
(1) Foreign currency transactions
When the foreign currency transactions are engaged, the amount shall be converted into the
functional currency at the spot exchange rate on the transaction date (or using an exchange rate
determined by a system reasonable method that is similar to the spot exchange rate on the
transaction date).
On the balance sheet date, foreign currency monetary items are converted using the spot exchange
rate on the balance sheet date. The exchange difference arising from the difference between the spot
exchange rate on the balance sheet date and the initial recognition or the spot exchange rate on the
previous balance sheet date shall be recognized in the current period's profit and loss; For foreign
currency non monetary items measured at historical cost, the spot exchange rate on the transaction
date shall still be used for translation; For foreign currency non-monetary items measured at fair
value, the spot exchange rate on the date of fair value determination is used for translation. The
difference between the converted amount in the functional currency and the original amount in the
functional currency is recognized in the current period's profit or loss or other comprehensive
income based on the nature of the non-monetary item.
90
Beijing Shougang Co. Ltd Annual Report 2023
(2) Foreign currency statement translation
On the balance sheet date, when converting the foreign currency financial statements of overseas
subsidiaries, the asset and liability items in the balance sheet are converted using the spot exchange
rate on the balance sheet date. Except for "undistributed profits", other items in shareholder equity
are converted using the spot exchange rate on the date of occurrence.
The income and expense items in the income statement are converted using the spot exchange rate
on the transaction date (or using an exchange rate determined by a systematic and reasonable
method that is similar to the spot exchange rate on the transaction date).
All items in the cash flow statement are converted at the spot exchange rate on the date of cash flow
occurrence (or an exchange rate determined by a reasonable system method that is similar to the
spot exchange rate on the date of cash flow occurrence). The impact of exchange rate changes on
cash is treated as an adjustment item and is separately reflected in the cash flow statement under the
item "Impact of exchange rate changes on cash and cash equivalents".
The difference arising from the conversion of financial statements is reflected in the "other
comprehensive income" item under the shareholder's equity item on the balance sheet.
When disposing of overseas operations and losing control, the foreign currency translation
differences related to the overseas operations listed under the shareholder's equity item in the
balance sheet shall be fully or proportionally transferred to the current profit and loss for disposal.
11. Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial
liability or equity instrument of another entity.
(1) Recognition and derecognition of financial instruments
The Company recognises a financial asset or a financial liability when, and only when, it becomes a
party to the contractual provisions of the instrument.
A financial asset will be derecognized when it satisfies one or more of the following conditions:
① The contractual rights to receive cash flows from the financial asset expire;
② The financial asset has been transferred, and it satisfies the following conditions for
derecognition.
The financial liability (or part of it) is derecognized when its contractual rights (or part of it) expire.
If the Company (as a debtor) makes an agreement with the creditor to replace the current financial
liability with assuming a new financial liability, and contractual provisions are different in
substance, the current financial liability shall be derecognized and a new financial liability shall be
recognized.
All financial assets purchased or sold in regular way are recognised or derecognised on the trading
date when the Company commits to purchase or sell the asset.
(2) Classification and measurement of financial assets
The Company classifies its financial assets, based on the entity's business model for managing the
91
Beijing Shougang Co. Ltd Annual Report 2023
financial assets and the contractual cash flow characteristics of the financial assets, as financial
assets at amortized cost, financial assets at fair value through other comprehensive income and
financial assets at fair value through profit or loss.
Financial assets are measured at fair value at initial recognition. For financial assets measured at
fair value with changes recognized in the current period's profit or loss, the relevant transaction
costs are directly recognized in the current period's profit or loss; For other categories of financial
assets, relevant transaction costs are included in the initial recognition amount. The initial
recognition amount of accounts receivable arising from the sale of products or provision of services,
which do not include or consider significant financing components, shall be the expected amount of
consideration that the company is entitled to receive.
Financial assets measured at amortized cost
The Company shall classify financial assets that meet the following conditions and are not
designated as financial assets at fair value through profit or loss as financial assets measured at
amortized cost:
The financial asset is held whose objective is to collect contractual cash flows;
The contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding.
After initial recognition, this type of financial asset using effective interest rate method to be
measured at amortized cost. The gain or loss generated by the financial assets measured at
amortized cost and not part of any hedging relationship shall be accounted in the profit or loss for
the year when the financial assets are derecognized, amortized by effective interest method or
recognized impairment.
Financial assets measured at fair value through other comprehensive income
The Company shall classify financial assets that meet the following conditions and are not
designated as financial assets at fair value through profit or loss as financial assets measured at fair
value through other comprehensive income:
The financial asset is held within a business model whose objective will be achieved by both
collecting contractual cash flows and trading financial assets;
The contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding.
After initial recognition, the financial assets are subsequently measured at fair value. Interest,
impairment loss/gain and exchange loss/gain calculated by the effective interest rate method are
recognised in profit or loss, while other profit or loss shall be recognised in other comprehensive
income. When derecognized, the accumulated profit or loss previously recognised in other
comprehensive gains shall be transferred to current profit or loss.
Financial assets measured at fair value through profit or loss
In addition to the aboving financial assets which are measured at amortized cost or at fair value
through other comprehensive income, the Company classifies all other financial assets as financial
assets measured at fair value through profit or loss. In order to eliminate and significantly reduce
accounting mismatches, the Company irrevocably designates some financial assets that should be
92
Beijing Shougang Co. Ltd Annual Report 2023
measured at amortized cost or at fair value through other comprehensive income as financial assets
at fair value through profit or loss during the initial recognition.
After initial recognition, the financial assets are subsequently measured at fair value, and the profit
or loss (including interest and dividend income) generated shall be recognised in current profit or
loss, unless the financial assets are part of the hedging relationship.
The Company evaluates the characteristics of the contract cash flow of financial assets to determine
whether the contract cash flow generated by the relevant financial assets on a specific date is only to
pay principal and the interest, which is based on the amount of unpaid principal. Among them,
principal refers to the fair value of financial assets at initial recognition; interest includes the
consideration of time value of money, credit risk related to the unpaid principal in a specific period,
and other basic credit risks, costs and profits. Additionally, the Company evaluates the terms and
conditions of the contracts that may alter time distribution or amount of cash flow in financial asset
contracts to determine whether they satisfy the requirements of the aboving contract cash flow’s
characteristics.
Only when the Company changes its business model of managing financial assets, all the financial
assets affected shall be reclassified on the first day of the first reporting period after the business
model alteration, otherwise, financial assets shall not be reclassified after initial recognition.
(3) Classification and measurement of financial liabilities
The Company classifies its financial liabilities at initial recognition as financial liabilities measured
at fair value through profit or loss and financial liabilities at amortized cost. With respect to
financial liabilities not classified as at fair value through profit or loss, transactions costs are
charged to initial recognition cost.
Financial liabilities measured at fair value through profit or loss
Financial liabilities at fair value through profit or loss, including financial liabilities held for trading
and those are designated as at fair value through profit or loss at initial recognition. For these
financial liabilities, they are subsequently measured at fair value and gains or lossess from the
change of fair value and related dividend and interest expense are recognized in profit or loss for the
year.
Financial liabilities measured at amortized cost
Other financial liabilities are subsequently measured at amortized cost using the effective interest
method, the gains and losses arising from derecognition or amortization is recognised in profit or
loss for the year.
Distinction between financial liabilities and equity instruments
The financial liability is the liability that satisfies one of following cateria:
① Contractual obligation to deliver cash or other financial instruments to another entity.
② Under potential adverse conditions, contractual obligation to exchange financial assets or
financial liabilities with other entity.
③ The contract that will or may be settled in the entity’s own equity instruments and is a
non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s
93
Beijing Shougang Co. Ltd Annual Report 2023
own equity instruments.
④ The derivative contract that will or may be settled in the entity’s own equity instruments other
than by the exchange of a fixed number of the entity’s own equity instruments for a fixed amount of
cash or other financial assets.
Equity instrument is the contract that evidences the residual equity in the assets of an entity after
deducting all of its liabilities.
If the Company cannot unconditionally avoid fulfilling a contractual obligation by delivering cash
or other financial assets, the contractual obligation satisfies the definition of financial liability.
If the financial instrument must or could be settled by the Company’s own equity instrument, the
Company should consider whether the Company’s equity instrument as the settlement instrument is
a substitute of cash or other financial assets or the residual equity in the assets of an entity after
deducting all of its liabilities. If it is the former one, the financial instrument is the Company’s
financial liability; if it is the latter one, the tool is the equity instrument of the Company.
(4) Fair value of financial instruments
For the determination method of fair value of financial assets and financial liabilities, please refer to
Note III.12.
(5) Impairment of financial assets
The Company performs impairment assessment and recognizes loss allowance for the following
financial assets based on the expected credit losses.
Financial assets measured at amortized cost;
Debt investment and trade receivables measured at fair value through other comprehensive
income;
Contract assets as defined in Accounting Standards for Enterprises No.14- Revenues;
Lease receivables;
Financial guarantee contracts (expect for the contracts measured at fair value through profit or
loss, financial assets transformation not qualify for derecognition and continuing involvement
of transferred financial assets).
Measurement of expected credit loss
The expected credit loss refers to the weighted average of the credit loss of financial instruments
that are weighted by the risk of default. Credit loss refers to the difference between all contractual
cash flows receivable from the contracts and all cash flows expected to be received, that is, the
present value of all cash shortages.
The Company considers the reasonable and basis information about past events, current situation
and forecast of future economic situation, calculates the probability weighted amount of the present
value of the difference between the receivable cash flow of the contract and the expected cash flow
with the risk of default as the weight, and confirms the expected credit loss.
The Company separately measures the expected credit losses of financial instruments at different
94
Beijing Shougang Co. Ltd Annual Report 2023
stages. The credit risk on a financial instrument has not increased significantly since initial
recognition, which is in Stage I. The Company measures the loss provision in accordance with
expected credit losses for the next 12 months. If the credit risk of financial instruments has
increased significantly since the initial recognition, but no credit impairment has occurred, which is
in Stage II. The Company measures the loss provision in accordance with the expected credit losses
for the whole lifetime of the financial instrument. If the financial instrument has occurred credit
impairment since initial recognition, which is in Stage III, and the Company measures the loss
provision in accordance with the expected credit losses for the whole lifetime of the financial
instrument.
For the financial instruments with lower credit risk at the balance sheet date, the Company assumes
that the credit risk has not increased significantly since the initial recognition, and measures the loss
provision in accordance with expected credit losses for the next 12 months.
The whole lifetime expected credit loss, refers to the expected credit loss caused by all possible
defaults during the whole expected lifetime. The 12-month expected credit losses, refer to the
expected credit loss caused by all possible defaults during the next 12 months after balance sheet
date (if the expected duration of financial instrument is less than 12 months, then for the expected
duration), which is part of the whole lifetime expected credit losses.
When measuring the expected credit loss, the maximum maturity period that the Company needs to
consider is the maximum contract maturity period (including the consideration of option of renewal)
the enterprise facing credit risk.
For financial instruments in Stage I, Stage II and with lower credit risk, the Company calculates
interest income on the basis of the book balances without deduction of impairment provisions and
with effective interest rates. For financial instruments in Stage III, the Company calculates interest
income on the basis of the book balances minus the impairment provision and with effective interest
rate.
For accounts receivable such as notes receivable, accounts receivable, accounts receivable financing,
and other receivables, if the credit risk characteristics of a certain customer are significantly
different from those of other customers in the portfolio, or if there is a significant change in the
credit risk characteristics of that customer, the Company will make a provision for bad debts on a
single item for that receivables. Except for accounts receivable with individual provision for bad
debts, the Company divides accounts receivable into combinations based on credit risk
characteristics and calculates bad debt provisions on the basis of the combination.
Notes Receivable and Accounts Receivable
For notes receivable, accounts receivable, whether or not there are significant financing elements,
the Company always measures the loss provision in accordance with the whole lifetime expected
credit losses.
If the expected credit loss information of the the independent financial asset cannot be evaluated by
a reasonable cost, the Company divides and combines notes receivable and accounts receivable
according to the characteristics of credit risk. On the basis of the combination, the Company
calculates the expected credit losses. The basis of determining combination is as follows:
A. Notes receivable
Notes receivable combination 1: Bank acceptances notes with higher credit ratings
95
Beijing Shougang Co. Ltd Annual Report 2023
Notes receivable combination 2: Bank acceptances notes with lower credit ratings and
Commercial acceptances
B. Accounts receivable: Accounts of receivable-trade
For the notes receivable divided into portfolios, the Company refers to historical credit loss
experience, combines current conditions with predictions of future economic conditions, calculates
expected credit losses through default risk exposure and expected credit loss rate over the entire
duration.
For accounts receivable divided into combinations, the Company refers to historical credit loss
experience, combines current conditions with predictions of future economic conditions, and
prepares a comparison table between the aging/overdue days of accounts receivable and the
expected credit loss rate for the entire existence period to calculate the expected credit loss. The age
of accounts receivable shall be calculated from the date of recognition.
Other receivables
According to the characteristics of credit risk, the Company divides other receivables into serval
combinations. On the basis of the combination, the Company calculates the expected credit losses.
The basis of determining the combination is as follows:
Other receivables Combination 1: Imprest and deposit, etc.
Other receivables Combination 2: Other current account
For other receivables divided into portfolios, the Company calculates expected credit losses based
on default risk exposure and expected credit loss rate over the next 12 months or the entire duration.
For other receivables grouped by aging, the aging shall be calculated from the date of recognition.
Debt investments and other debt investments
For debt investments and other debt investments, the Company calculates expected credit losses
based on the nature of the investment, various types of counterparty and risk exposure, default risk
exposure, and expected credit loss rate for the next 12 months or the entire duration.
Assessment of Significant Increase in Credit Risk
By comparing the default risk of financial instruments on balance sheet date with the default risk on
initial recognition date, the Company determines the relative change of default risk of financial
instruments during the expected lifetime of financial instruments to evaluate whether the credit risk
of financial instruments has increased significantly since the initial recognition.
When determining whether credit risk has increased significantly since the initial recognition, the
Company considers reasonable and valid information, including forward-looking information,
which can be obtained without unnecessary additional costs or efforts. Information considered by
the Company includes:
The debtor cannot pay principal and interest on the expiration date of the contract;
Serious deterioration of external or internal credit ratings (if any) of financial instruments that
have occurred or are expected to occur;
96
Beijing Shougang Co. Ltd Annual Report 2023
Serious deterioration of the debtor’s operating results that have occurred or are expected to
occur;
Changes in the existing or anticipated technological, market, economic or legal environment
will have the significant negative impact on the debtor’s repayment capacity.
According to the nature of financial instruments, the Company evaluates whether credit risk has
increased significantly on the basis of an independent financial instrument or a combination of
financial instruments. When assessing on the basis of the combination of financial instruments, the
Company can classify financial instruments based on common credit risk characteristics, such as
overdue information and credit risk rating.
If the delay exceeds 30 days, the Company determines that the credit risk of financial instruments
has increased significantly.
Financial assets that have occured credit impairment
On the balance sheet date, the Company assesses whether credit impairment has occurred in
financial assets measured at amortized cost and debt investments measured at fair value through
other comprehensive income. When one or more events adversely affect the expected future cash
flow of the financial assets occur, the financial assets transfer to the financial assets with credit
impairment. Evidence of credit impairment of financial assets includes the following observable
information:
Issuer or debtor suffer from significant financial difficulties;
Debtor breaches any of the contractual stipulations, for example, fails to pay or delays the
payment of interests or the principal, etc.;
In consideration of economic situationand contract related to the financial difficulties of the
debtor, the Company grants concessions to the debtor that will not be made under any other
circumstances.
Debtor is probable to go bankrupt or undergo other financial restructuring.
Financial difficulties of issuer or debtor lead to the disappearance of financial assets active
market.
Presentation of expected credit loss reserve
In order to reflect the changes happened to the credit risk of financial instruments since the initial
recognition, the Company recalculates the expected credit loss on each balance sheet date. The
increase or reversal of the loss provision resulting therefrom is recognised as an impairment loss or
gain in the current profit or loss.For financial assets measured at amortized cost, loss provision
offsets the carrying amount of the financial assets presentated on the balance sheet; for debt
investments measured at fair value through other comprehensive income, the Company recognizes
its loss provision through other comprehensive income and does not offset the financial assets’
carrying amount.
Write off
If the Company no longer reasonably expects that the financial assets contract cash flow can be
recovered fully or partially, the financial assets book balance will be reduced directly. Such
97
Beijing Shougang Co. Ltd Annual Report 2023
reduction constitutes derecognition of the financial assets. The situation usually occurs when the
Company determines that the debtor has no assets or income to generate sufficient cash flows to
pay the amount to be reduced. However, in accordance with the Company’s procedures for
recovering due payment, the financial assets reduced may still be affected by enforcement activities.
If the reduced financial assets can be recovered later, the returns as impairment losses shall be
recorded in the profit or loss.
(6) Transfer of financial assets
Transfer of financial assets is the transfer or delivery of financial assets to another entity (the
transferee) other than the issuer of financial assets.
A financial asset is derecognised when the Company has transferred substantially all the risks and
rewards of the asset to the transferee. A financial asset is not derecognised when the Company
retains substantially all the risks and rewards of the financial asset.
When the Company has neither transferred nor retained substantially all the risks and rewards of the
financial asset, it either (i) derecognises the financial asset and recognises the assets and liabilities
created in the transfer when it has not retained control of the asset; or (ii) continues to recognise the
transferred asset to the extent of the Company’s continuing involvement, in which case, the
Company also recognises an associated liability.
(7) Offsetting of financial assets and financial liabilities
When the Company has currently enforceable legal rights to offset the recognized financial assets
and financial liabilities, and there is an intention to settle on a net basis or to realize the financial
assets and settle the financial liabilities, the financial assets and financial liabilities shall be
presented in balance sheet with the amount after offsets. Besides, the financial assets and financial
liabilities shall be presented separately in balance sheet and are not allowed to be offset.
12. Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date.
The Company measures related assets or liabilities at fair value and assumes that selling assets or
transferring liabilities in an orderly transaction in the principal market of related assets or liabilities;
in the absence of a principal market, the Company assumes the transaction in the most
advantageous market. Principal market (or the most advantageous market) is the market that the
Company can enter into on measurement date. The Company adopts the presumptions used by
market participants in achieving the maximum economic value of pricing the assets or liabilities.
For financial assets or financial liabilities in the active market, the Company uses the quoted price
in active market as fair value. Otherwise, the Company uses valuation technique to determine the
fair value.
Fair value measurement of non-financial assets considers market participants’ ability to generate
economic benefits by using the assets in its highest and best use or by selling it to another market
participant that would use the asset in its highest and best use.
The Company adopts the valuation techniques that are appropriate under current circumstances and
for which sufficient data and other supporting information are available to measure fair value,
98
Beijing Shougang Co. Ltd Annual Report 2023
giving priority to the use of relevant observable inputs, and using unobservable inputs only if the
observable inputs are unavailable or not feasible to obtain.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are
categorized within the fair value hierarchy, described as follows, based on the lowest level input
that is significant to the fair value measurement as a whole: Level 1 inputs are quoted (unadjusted)
market prices in active markets for identical assets or liabilities; Level 2 inputs are observable
inputs for related assets or liabilities, either directly or indirectly other than the inputs within Level
1; Level 3 inputs are unobservable inputs for related assets or liabilities.
For assets and liabilities that are recognized in the financial statements on a recurring basis, the
Company determines whether transfers have occurred between levels in the hierarchy by
reassessing categorization at the end of each reporting period.
13. Inventories
(1) Classification
Inventories of the Company include raw materials, finished goods, lower-valued consumables and
self-made semi-finished goods, etc.
(2) Mesurement method of cost of delivered inventories
Inventories are quoted at actual costs when acquired. Raw materials, finished goods and self-made
semi-finished goods are determined on the weighted average basis.
(3) Determination basis and provision method for inventory impairment provision
On the balance sheet date, inventory is measured at the lower of cost and net realizable value. When
its net realizable value is lower than cost, a provision for inventory impairment is made.
Net realisable value is the estimated selling price deducted by the estimated costs to completion, the
estimated selling expenses and related taxes. The net realisable value is measured on the basis of
obtained verified evidences and considerations for the purpose of holding inventories and the effect
of post balance sheet events.
The Company usually makes provisions for inventory impairment based on individual inventory
items. For inventory with a large quantity and low unit price, provision for inventory impairment
shall be made according to the inventory category.
On the balance sheet date, if the factors affecting the previous write down of inventory value have
disappeared, the provision for inventory impairment shall be reversed within the originally
provisioned amount.
(4) Inventory system
Inventories are accounted for using the perpetual inventory system.
(5) Amortization method for consumables
Low-valued consumables are charged with the one-off amortization method and multi-stage
amortization method at consumption.
14. Long-term equity investments
99
Beijing Shougang Co. Ltd Annual Report 2023
Long-term equity investments consist of equity investments in subsidiaries, joint ventures and
associates. An associate is an enterprise over which the Company has significant influence.
(1) Recognition of initial investment cost
Long-term equity investment from the business combination: For a long-term equity investment
acquired through a business combination under common control, the initial investment cost of the
long-term equity investment shall be the absorbing party’s share of the carrying amount of the
owners’ equity of the party being absorbed in the consolidated financial statements of the ultimate
controlling party at combination date. For business combination involving entities not under
common control, the initial investment cost of long-term equity should be the cost of acquisition.
Long-term equity investment from other methods：for a long-term equity investment acquired by
paying cash, the initial investment cost shall be the actual purchase price paid; for those acquired by
the issue of equity securities, the initial investment cost shall be the fair value of the equity
securities issued.
(2) Subsequent measurement and recognition of profit or loss
The cost method is applied for the investment of subsidiaries unless the investment satisfies the
conditions of held for sale; the equity method is applied for the investment of joint ventures and
associates.
When the cost method is adopted in long-term equity investments, except for cash dividends or
profit distributions declared but not yet distributed in the purchase price or consideration of
obtaining the investment, profits or cash dividends declared to be distributed by the investee should
be recognised as investment income in the current period.
When the equity method is adopted in long-term equity investments, the initial cost of an
investment in excess of the share of investee’s fair value on identifiable net assets remains
unchanged; the initial cost of the investment that falls short of the share of investee’s fair value on
identifiable net assets shall be adjusted, for the difference which had been charged to current profit
or loss.
When the equity method is adopted, the Company recognises its share of the investee’s profit or
loss, as well as its share of the investee’s other comprehensive income, as investment income or loss
and other comprehensive income, and adjusts the carrying amount of the investment accordingly;
the investor’s share of profit distributions or cash dividends declared by the investee is deducted
from the carrying amount of the investment. For the changes of equity in an investee other than
profit or loss, the investor adjusts the carrying amount of the investment and recognised it in capital
reserve (other capital reserves). The recognition of the investee’s results should be based on the fair
values of the individual identifiable assets of the investee according to the Company’s accounting
policies and accounting period. Additionally, the recognition should be based on the adjusted net profit
of the investee.
If the Company has significant influences or can implement joint control over investees due to
additional investment, the initial investment cost is recognized as the sum of the fair value of the
original portion of equity investment and the additional investment cost under equity method on the
transformation date. The accumulated fair value changes accounted in other comprehensive income
of non tradable equity instrument investment which is initially classified as fair value through other
comprehensive income are transferred to retained earnings while accounting by equity method
instead.
100
Beijing Shougang Co. Ltd Annual Report 2023
If the Company loses control of an investee with joint control or significant influence retained after
partial disposal of its shares, the remaining equity after disposal should be accounted in accordance
with the rules “CASBE 22-Recognition and Measurement of Financial Instruments” and the
difference between the fair value on the day of losing control and the book value is recognised in
profit or loss. For the other comprehensive income recognized by equity investment under the
equity method, the basis of the accounting treatment is the same as that on disposal of related assets
or liabilities by the investee, the amount recognised in the equity on the changes in other equity
movements should be all charged to the profit or loss for the year.
If the Company loses control of an investee after partial disposal of its shares, the remaining equity
after disposal has joint control or significant influence over the investee, the equity method shall be
adopted and the remaining equity shall be deemed to be recognized under equity method since the
acquisition date; if the remaining equity has no joint control or significant influence over the
investee, the remaining equity after disposal should be accounted in accordance with the
rules“CASBE 22-Recognition and Measurement of Financial Instruments” and the difference
between the fair value on the day of losing control and the book value is recognised in profit or loss.
If the shareholding ratio of the Company is reduced due to the increase of investments of other
investors and thus the control is lost, but the joint control or significant influence can be exerted on
the investee, the Company should recognize the incremental shares of net assets according to the
new investments. The difference between the original book value of the long-term equity
investment corresponding to the decrease in the shareholding ratio should be included in the current
profit or loss; then, the equity shall be deemed to be recognized under equity method since the
investment date and adjusted according to the new shareholding ratio.
Unrealised profit or loss resulting from transactions between the Company and its associates or
joint ventures shall be calculated according to the proportion of its shareholding, which is
attributable to the Company, and then to be recognized in investment income after offset. While
unrealised profit or loss resulting from transactions between the Company and investee belongs to
impairment loss of transferred assets cannot be offset.
(3) Basis of determining the existence of joint control or significant influence over an investee
Joint control is the agreed sharing of control of an arrangement, which exists only when decisions
about the relevant activities require unanimous consent of the parties sharing control. In
determining whether there is a joint control, the first judge is determining whether the relevant
arrangement is controlled collectively by all the participants involved or the group of the
participants involved and then to determine whether the decisions related to the basic operating
activities should require the unanimous consent of the participants involved. If all participants or the
group of the participants involved must act consistently to determine the relevant arrangement, it is
considered that all participants or the group of the participants control the arrangement. If two or
more participants in the collectively control of certain arrangement, it shall not be considered as
joint control. Protection of rights shall not be considered in determining whether there is joint
control.
Significant influence is the power to participate in the financial and operating policy decisions of
the investee but is not control or joint control over those policies. When determining whether there
is the significant influence over the investee, the voting rights held by the investors or the other
entites and the effect of potential voting rights if it can be converted into the equity of investee,
including the effect of current convertible warrants, security option and convertible bonds.
When the Company, directly or indirectly through subsidiaries, owns 20% of the investee (including
101
Beijing Shougang Co. Ltd Annual Report 2023
20% ) or more but less than 50% of the voting shares, it has significant impact on the investee
unless there is clear evidence to show that in this case the Company cannot participate in the
production and business decisions of the investee, and has no significant influence; when the
Company owns 20% (excluding) or less of the voting shares, it is not considered to have significant
impacts on the investee in general, unless there is clear evidence to show that in this case the
Company can participate in the production and business decisions of the investee so as to have the
significant influence.
(4) Method of impairment testing and impairment provision
For investment in subsidiaries, associates and joint ventures, refers to Note III, 21 for the method of
asset impairment provision.
15. Fixed assets
(1) Recognition of fixed assets
Fixed assets represent the tangible assets held by the Company for use in production of goods, use
in supply of services, rental or for administrative purposes with useful lives over one accounting
year.
Fixed assets are recognised when it is probable that the related future economic benefits will flow
into the company, and the cost can be measured reliably.
Fixed assets of the Company are initially measured at actual costs in acquisition.
The subsequent expenditure related to fixed assets is included in cost of the fixed assets when the
relevant economic benefits are likely to flow into the Company and its cost can be measured
reliably; routine repair expenditure of fixed assets that do not meet the conditions for capitalization
is included in the profit and loss or the cost of relevant assets according to the beneficiaries when it
occurs. The book value of the replaced part shall be derecognized.
(2) Depreciation of fixed assets
Depreciation of the fixed assets is calculated on the straight-line basis. The fixed asset is
depreciated since the state of intended use and no longer depreciated when recognition is terminated
or being classified as non-current assets held for sale. Without considering impairment provision,
the estimated useful lifetime, estimated residual values, and the annual depreciation rates of each
category of fixed assets are as follows:
Estimated Estimated Annual
Category
useful life (year) residual rate (%) depreciation rate (%)
Pant and buildings 25-43 5 3.80-2.21
Machinery and equipment 12-28 5 7.92-3.39
Vehicles 10 5 9.50
Electronic equipment 10 5 9.50
Industrial furnace 13 5 7.31
102
Beijing Shougang Co. Ltd Annual Report 2023
Metallurgical equipment 19 5 5.00
Others 14-22 5 6.79-4.32
The fixed assets that have been withdrawn for impairment provision shall also be deducted from the
accumulative amount of impairment provision to recognize depreciation rate.
(3) Impaitment test and impairment provision of fixed assets refer to Note III, 21.
(4) Useful lives, residual values and the depreciation method are reviewed by the Company at least at
each financial year end.
Useful lives are adjusted if the expected useful lives are different from the original estimates; the
estimated net residual values are adjusted if they are different from the original estimates.
(5) Disposal of fixed assets
The fixed assets are derecognied when the fixed assets are diposed or when it is not expected to
generate economic benefits through use or disposal of the fixed assets. The amount of the disposal
income from the sale, transfer, scrapping or damage of fixed assets after deducting its book value
and relevant taxes shall be included in the current profit and loss.
16. Construction in progress
Cost of construction in progress is determined based on actual project expenses, including
necessary project expenses incurred during the construction period, borrowing costs that should be
capitalized before the project reaches its intended usable state, and other related expenses.
Self-built fixed assets are transferred to fixed assets while reaching the intended usable state, which
were recognised in construction in progress before transfer to fixed assets and are not subject to
depreciation.
When the construction in progress reaches the predetermined usable state, it shall be transferred to
fixed assets based on the actual cost of the project. For those that have reached the predetermined
usable state but have not yet processed the final accounts for completion, it shall be transferred to
fixed assets based on the estimated value. After the final accounts for completion are processed, the
original estimated value shall be adjusted based on the actual cost, but the depreciation already
provisioned shall not be adjusted.
Types Standards and timing for transferring construction in progress to fixed assets
Machinery and equipment Achieving the design requirements or contractual standards after installation and debugging
Preliminary acceptance is qualified and meets the predetermined usable state or the standards
Plant and buildings
specified in the contract
Impairment provision of construction in progress refers to Note III. 21.
17. Materials for construction of fixed assets
The materials for construction of fixed assets of the Company refers to the material prepared for
construction in progress, including engineering materials, equipments not yet installed and tools
prepared for production, etc.
Purchase measured at cost, the recipients transfer to construction in progree, and the remaining
103
Beijing Shougang Co. Ltd Annual Report 2023
transfer to inventory after the completion of construction.
Impairment provision of materials for construction of fixed assets refers to Note III, 21.
Closing balance of materials for construction of fixed assets is presented in “Construction in
progress” in balance sheet.
18. Borrowing costs
(1) Principles of capitalising borrowing costs
All the borrowing costs that are directly attributable to construction or production of all qualifying
assets are capitalized and recorded in relevant assets costs. Other borrowing costs are treated as an
expense and recorded in the profit or loss. The capitalization of borrowing costs commences when:
① Expenditures for the assets are incurred, including paying cash, transferring non-cash assets or
undertaking interest-bearing debt for acquisition or construction of the assets, which could be
capitalized;
② Borrowing costs are incurred; or
③ The acquisition and construction activities that are necessary to bring the assets to get ready for
the intended use or sale have commenced.
(2) Capitalization period of borrowing costs
The capitalization of borrowing costs ceases when the asset being acquired or constructed is
substantially ready for its intended use or sale and borrowing costs incurred thereafter are treated as
an expense to be recorded in the profit or loss.
Capitalization of borrowing costs is suspended during extended periods in which the acquisition or
construction of a fixed asset is interrupted abnormally and the interruption lasts for more than three
months until the acquisition or construction is resumed; borrowing costs in normal interruption
period continue to be capitalized.
(3) Calculation of capitalization rate and amount of borrowing costs.
For specific borrowings, the borrowing costs eligible for capitalization are the actual borrowing
costs incurred during the current period deducted by any temporary interest or investment income;
for general borrowings, the borrowing costs eligible for capitalization are determined by applying a
capitalization rate to the weighted average of capital expenditure that exceeds the specific
borrowings. The capitalization rate is calculated based on the weighted average interest rate of
general borrowings.
During the capitalization period, exchange differences on foreign currency specific borrowings shall
be capitalized; exchange differences on foreign currency general borrowings shall be recognized as
current profit or loss.
19. Intangible assets
(1) Valuation method, service life and impairment test
Intangible assets include land use rights, software and etc.
104
Beijing Shougang Co. Ltd Annual Report 2023
Intangible assets are measured at cost initially and its useful lifetime shall be analyzed and
recognized when obtained. An intangible asset with finite useful lifetime shall be amortized over the
expected useful life using method which can reflect the expected recognition of economic benefits
related to the assets when the intangible asset is available for use; an intangible asset whose
expected recognition cannot be reliably determined is amortized at straight-line amortization
method; an intangible asset with indefinite useful lifetime shall not be amortized.
The useful life, determination basis, and amortization method of various intangible assets are:
Basis for determining
Category Useful life (years) Amortisation method
useful life
Expected period for
Software 5-10 Straight line method bringing economic benefits to
the company
Land use rights 40-50 Straight line method Legal useful life
The Company reviews the useful lives and amortization method of intangible assets with finite
useful lifetime, adjusts original estimated amount and processes according to the accounting
estimate change if there are any differences with original estimated, at least at the end of each
reporting period.
The Company estimates an intangible asset can no longer bring future economic benefits at the
balance sheet date, and then the carrying amount of the intangible asset should be reversed to the
current profit or loss.
For the impairment provision of intangible assets, refers to Note III, 21.
20. Research and development expenditure
The Company's R&D expenses are directly related to the R&D activities, including employee
salaries, technical service fees, testing fees, etc. The salaries of R&D personnel are allocated to
R&D expenses based on project working hours.
Expenditure on internal research and development projects is classified into expenditure on the
research stage and expenditure on the development stage.
Expenditure on the research stage is recognised in the profit or loss when incurred.
Expenditure on the development stage is capitalized only when: the technical feasibility of
completing the intangible asset so that it is available for use or sale; the intention to complete the
intangible asset is to use or sell it; the method of generating economic benefits by the intangible
assets, including that the intangible asset can be proved that the output or the intangible asset itself
has market or, if it is to be used internally, the usefulness of the intangible asset also need to be
proved; the availability of adequate technical, financial and other resources to complete the
development and the ability to use or sell the intangible asset; the expenditure attributable to the
development stage can be measured reliably. Otherwise, it shall be presented in the profit or loss.
105
Beijing Shougang Co. Ltd Annual Report 2023
The research and development projects of the Company will enter into the development stage after
meeting the above conditions and passing through the studies of technical feasibility and economic
feasibility, and the projects approval.
Capitalized expenditure on the development stage is presented as “Development expenditures” in
the balance sheet and shall be transferred to intangible assets when the project is completed to its
intended use state.
21. Impairment of assets
The impairment for the long-term equity investments, fixed assets, construction in progress,
right-of-use asset, intangible assets, etc. (excluding inventories, deferred income tax assets and
financial assets) of subsidiaries, associates and joint ventures are determined as follows:
The Company assesses whether any indicator of impairment exists as of the end of each reporting
period, and, if yes, performs impairment test by estimation of the asset’s recoverable amount. For
goodwill acquired in business combinations, intangible assets with indefinite lives and intangible
assets without intended use state, an annual impairment test is performed no matter whether there is
any indicator of impairment.
An asset’s recoverable amount is calculated as the higher of the asset’s fair value less costs to sell
and the present value of estimated future cash flows generated from the use of assets. The
recoverable amount is calculated on individual basis unless it is not applicable, in which case the
recoverable amount is determined for the asset group to which the asset belongs. An asset group is
recognized based on whether the cash inflows generated by the asset group are largely independent
to those of other assets or asset groups.
When the recoverable amount of an asset or an asset group is less than its carrying amount, the
carrying amount is reduced to its recoverable amount. The reduction amount is charged to profit or
loss and an impairment allowance is provided.
In terms of impairment test of the goodwill, the carrying amount of the goodwill arising from
business combination shall be allocated to the related asset group in accordance with a reasonable
basis at acquisition date. Those that are difficult to be allocated to relevant assets shall be allocated
to relevant assets groups. Relevant assets or assets groups refer to those that can benefit from the
synergies of business combination and are not larger than the Company’s recognized reporting
segment.
When there is an indication that the goodwill related asset and asset group are prone to impair, the
Company should execute impairment test for the asset and asset group excluding goodwill,
calculate the recoverable amount and recognize the corresponding impairment loss. The Company
should execute impairment test for the asset or asset group including goodwill and compare the
recoverable amount with carrying amount, provision for impairment of assets shall be recognized
when the recoverable amount of assets is lower than its carrying amount.
Impairment losses cannot be reversed in subsequent accounting periods after recognition.
22. Long-term prepaid expenses
The long-term prepaid expenses of the Company are recorded as the actual cost and evenly
amortized on straight-line basis over the expected beneficial period. For the long-term prepaid
106
Beijing Shougang Co. Ltd Annual Report 2023
expense items that cannot benefit the later accounting period, the amortized value is recognized in
the profit or loss.
23. Payroll and employee benefits payable
(1) The scope of employee benefits payable
Payroll and employee benefits payable are all forms of consideration given by an entity in exchange
for service rendered by employees or the termination of employment, including short-term
employee benefits, post-employment benefits, termination benefits and other long-term employee
benefits. The benefits that the Company provides to the spouses, children and dependents of
employees, the late employees’ family and other beneficiaries also shall be deemed as payroll and
employee benefits payable.
According to liquidity, employment benefits are presented separately as “Payroll and employee
benefits payable” and “Long-term payroll and employee benefits payable” in the balance sheet.
(2) Short-term employee benefits payable
A liability when an employee has provided service in exchange for employee benefits, such as
wages, bonuses, social security contributions (including medical insurance, injury insurance,
maternity insurance, etc.) and house funding to be paid is recognized as the current profit or loss or
costs of related assets.
(3) Post-employment benefits
Post-employment benefit plan includes defined contribution plan and defined benefit plan. Defined
contribution plan is the post-employment benefit plan under which the Company pays fixed
contributions into a separate fund and will have no future obligations to pay the contributions.
Defined benefit plan is the post-employment benefit plan other than defined contribution plan.
Defined contribution plan
Defined contribution plan includes basic pension insurance, unemployment insurance, and
corporate pension plans, etc.
In addition to basic pension insurance, the Company has established an enterprise pension plan
("Pension Plan") in accordance with the relevant policies of the national enterprise pension system,
and employees can voluntarily participate in this pension plan. Except above, the Company has no
other significant employee social security commitments.
During the accounting period of service provided by the employee, the Company shall recognise the
contribution payable according to the defined contribution plan as the liability and record the
corresponding amount in the current profit or loss or the cost of the relevant asset.
(4) Termination benefits
The Company is required to recognize termination benefits with a corresponding charge to profit or
loss at the earlier of when the entity can no longer withdraw an offer of those benefits and when it
recognizes any related restructuring costs.
For implementing the internal retirement plan, the economic compensation before the official
retirement date belongs to termination benefits. From the date of ceasing service to the normal
107
Beijing Shougang Co. Ltd Annual Report 2023
retirement date, the wages of the internally retired employees and the social insurance premiums to
be paid are included in the current profit or loss one time. Economic compensation after the official
retirement date (such as normal pension) should be treated as post-employment benefits.
24. Provisions
If the contingent considerations or contingent liabilities satisfy the following conditions
simultaneously, a provision will be recognized by the Company:
(1) The obligation is a present obligation assumed by the Company; and
(2) It is probable that an outflow of resources embodying economic benefits will be required to
settle the obligation; and
(3) A reliable estimate can be made of the amount of the obligation.
Provisions are initially measured at the best estimate of the expenditure required to settle the present
obligation, after considering risks, uncertainties, present value, etc. If the impact of time value of
money is significant, the best estimate is determined as its present value of future cash outflow.
Provisions shall be reviewed at the end of each reporting period and adjusted to reflect the current
best estimate.
If the settlement of provision is fully or partially compensated by a third party or the others, and the
compensated amount can be definitely received, then the provision can be recognised as asset
separately. The compensated amount shall not be greater than the carrying amount of the recognized
liability.
25. Share-based payments and equity instruments
(1) Category of share-based payments
The Company’s share-based payment is either equity-settled share-based payment or cash-settled
share-based payment.
(2) Determination of fair value of equity instruments
For the existence of an active market for options and other equity instruments granted by the
Company, the fair value is determined at the quoted price in the active market. For options and
other equity instruments with no active market, option pricing model shall be used to estimate the
fair value of the equity instruments. The following factors shall be taken into account using option
pricing models: A. the exercise price of the option; B. the validity period of the option; C. the
current market price of the share; D. the expected volatility of the share price; E. predicted dividend
of the share; and F. risk-free rate of the option within the validity period.
(3) Recognition of vesting of equity instruments based on the best estimate
On each balance sheet date within the vesting period, the estimated number of equity instruments
expected to vest is revised based on the best estimate made by the Company according to the latest
available subsequent information as to changes in the number of employees with exercisable rights.
On the vesting date, the final estimated number of equity instruments expected to vest should equal
the actual number of equity instruments expected to vest.
108
Beijing Shougang Co. Ltd Annual Report 2023
(4) Accounting treatment of implementation, modification and termination of share-based payment
Equity-settled share-based payment shall be measured at the fair value of the equity instruments
granted to employees. If the right may be exercised immediately after the grant, the fair value of
equity instrument shall, on the date of the grant, be included in the relevant costs or expenses, and
the capital reserve shall be increased accordingly. If the right can not be exercised until the vesting
period comes to an end or until the specified performance conditions are met, then on each balance
sheet date within the vesting period, the services obtained in the current period shall, based on the
best estimate of the number of vested equity instruments, be included in the relevant costs or
expenses and the capital reserve at the fair value of the equity instrument on the date of the grant.
After the vesting date, the Company make no adjustment to the relevant costs or expenses as well as
the total amount of the owner’s equities which have been confirmed.
Cash-settled share-based payment shall be measured in accordance with the fair value of liability
calculated and recognised based on the shares or other equity instruments undertaken by the
Company. If the right may be exercised immediately after the grant, the fair value of the liability
undertaken by the Company shall, on the date of the grant, be included in the relevant costs or
expenses, and the liabilities shall be increased accordingly. If the right may not be exercised until
the vesting period comes to an end or until the specified performance conditions are met, on each
balance sheet date within the vesting period, the services obtained in the current period shall, based
on the best estimate of the information about the exercisable right, be included in the relevant costs
or expenses and the corresponding liabilities at the fair value of the liability undertaken by the
Company. On each balance sheet date and on each account date prior to the settlement of the
relevant liabilities, the Company re-measures the fair value of the liabilities and include the changes
in the current profits and losses.
When there are changes in Company’s share-based payment plans, if the modification increases the
fair value of the equity instruments granted, corresponding recognition of service increase in
accordance with the increase in the fair value of the equity instruments; if the modification
increases the number of equity instruments granted, the increase in fair value of the equity
instruments is recognised as a corresponding increase in service achieved. Increase in the fair value
of equity instruments refer to the difference between the fair values of the modified date. If the
modification reduces the total fair value of shares paid or not conductive to the use of other
employees share-based payment plans to modify the terms and conditions of service, it will
continue to be accounted for in the accounting treatment as if the change had not occurred, unless
the Company cancelled some or all of the equity instruments granted.
During the vesting period, if the cancelled equity instruments (except for failure to meet the
conditions of the non-market vesting conditions) granted by the Company to cancel the equity
instruments granted amount treated as accelerated vesting of the remaining period should be
recognised immediately in profit or loss, while recognising capital reserves. If employees or other
parties can choose to meet non-vesting conditions but they are not met in the vesting period, the
Company will treat them as cancelled equity instruments granted.
(5) Restricted stock
In the equity incentive plan, the Company grants restricted stocks to the incentivized objects, and
the incentivized objects first subscribe to the stocks. If the unlocking conditions specified in the
equity incentive plan are not met in the future, the Company will repurchase the stocks at the pre
agreed price. If the restricted stocks issued to employees have completed the registration and capital
increase procedures in accordance with relevant regulations, on the grant date, the Company shall
109
Beijing Shougang Co. Ltd Annual Report 2023
confirm the share capital and capital reserve (share premium) based on the subscription payments
received from employees; Simultaneously, recognize treasury shares and other payables for
repurchase obligations.
26. Revenue
(1) General principle
Revenue is recognized when the Company has satisfied its performance obligations in the contract,
that is, when the customer obtains control of the relevant goods or services.
Where a contract has two or more performance obligations, the Company determines the
stand-alone selling price at contract inception of the distinct good or service underlying each
performance obligation in the contract and allocates the transaction price in proportion to those
stand-alone selling prices. The Company recognises as revenue the amount of the transaction price
that is allocated to each performance obligation.
If one of the following conditions is met, it belongs to fulfilling the performance obligation within a
certain period of time; Otherwise, it belongs to fulfilling the performance obligation at a certain
point in time:
① The customer simultaneously receives and consumes the benefits provided by the Company’s
performance as the Company performs;
② The customer can control the asset created or enhanced during the Company’s performance;
③ The Company’s performance does not create an asset with an alternative use to it and the
Company has an enforceable right to payment for performance completed to date.
For performance obligation satisfied over time, the Company recognises revenue over time by
measuring the progress towards complete satisfaction of that performance obligation. When the
outcome of that performance obligation cannot be measured reasonably, but the Company expects
to recover the costs incurred in satisfying the performance obligation, the Company recognises
revenue only to the extent of the costs incurred until such time that it can reasonably measure the
outcome of the performance obligation.
For performance obligation satisfied at a point in time, the Company recognises revenue at the point
in time at which the customer obtains control of relevant goods or services. To determine whether a
customer has obtained control of goods or services, the Company considers the following
indicators:
① The Company has a present right to payment for the goods or services, as the customer obtains
the current payment obligation for the goods.
② The Company has transferred the legal title of the goods, as the customer has obtained the legal
title of the goods.
③ The Company has transferred physical possession of the goods to the customer, as the customer
has obtained the physical possession of the goods.
④ The Company has transferred the significant risks and rewards of legal title of the goods to the
customer, as the customer has obtained the significant risks and rewards of legal title of the goods.
110
Beijing Shougang Co. Ltd Annual Report 2023
⑤ The customer has accepted the goods or services.
⑥ Other indications that the customer has obtained control of goods.
(2) Specific recognition methods
Contracts for the sale of goods
Contracts for the sale of goods between the Company and its customers usually only involves the
performance obligations of the transferring of the goods. The Company generally recognizes
revenue based on the following considerations, taking into account the timing of control transfer.
This includes obtaining the current collection rights of the goods, the transfer of the main risks and
rewards of the ownership of the goods, the transfer of the legal ownership of the goods, the transfer
of the physical assets of the goods, and the acceptance of the goods by the customer.
Contracts for rendering of services
The service contract between the Company and its customers usually includes performance
obligations for labor services, technical consulting or technical services. As a result of the
satisfaction of the performance obligation the Company, the customers obtain and consume the
economic benefits of the service while the Company provides the service simultaneously. The
Company is entitled to recover from the accumulative performance of the contract that has been
completed to date, except when progress of the performance cannot be reasonably determined. The
Company determines the progress of the performance of the services provided in accordance with
the input method. When the progress of the performance cannot be reasonably determined, and the
costs incurred by the Company are expected to be compensated, the revenue will be recognized
based on the amount of costs incurred, until the progress of the performance can be reasonably
determined.
27. Contract cost
Contract costs are either the incremental costs of obtaining a contract with a customer or the costs to
fulfil a contract with a customer.
Incremental costs of obtaining a contract are those costs that the Company incurs to obtain a
contract with a customer that it would not have incurred if the contract had not been obtained e.g.
an incremental sales commission. The Company recognises as an asset the incremental costs of
obtaining a contract with a customer if it expects to recover those costs. Other costs of obtaining a
contract are expensed when incurred.
If the costs to fulfil a contract with a customer are not within the scope of inventories or other
accounting standards, the Company recognises an asset from the costs incurred to fulfil a contract
only if those costs meet all of the following criteria:
① The costs relate directly to an existing contract or to a specifically identifiable anticipated
contract, including direct labour, direct materials, allocations of overheads (or similar costs), costs
that are explicitly chargeable to the customer and other costs that are incurred only because the
Company entered into the contract;
② The costs generate or enhance resources of the Company that will be used in satisfying (or in
continuing to satisfy) performance obligations in the future;
111
Beijing Shougang Co. Ltd Annual Report 2023
③ The costs are expected to be recovered.
Assets recognised for the incremental costs of obtaining a contract and assets recognised for the
costs to fulfill a contract (the “assets related to contract costs”) are amortised on a systematic basis
that is consistent with the transfer to the customer of the goods or services to which the assets relate
and recognised in profit or loss for the current period.
The Company recognises an impairment loss in profit or loss to the extent that the carrying amount
of an asset related to contract costs exceeds:
① Remaining amount of consideration that the Company expects to receive in exchange for the
goods or services to which the asset relates; less
② The costs that relate directly to providing those goods or services that have not yet been
recognised as expenses.
28. Government grants
Government grants are recognized in profit or loss, when they are highly probable to be received
and all conditions are fulfilled.
If a government grant is in form of monetary asset, it is measured at the amount received or
receivable. If a government grant is in form of nonmonetary asset, it is measured at fair value of the
asset. If the fair value cannot be reliably determined, it is measured at the nominal amount as RMB
1.
Asset-related government grants are recognized when the government document designates that the
government grants are used for constructing or forming long-term assets. Otherwise, the
government grants should be income-related.
If the government document is inexplicit, the Company should recognize the part corresponding to
assets value of government grants as asset-related government grants if the conditions are to form
long-term assets and the remaining part as income-related grants. As for indistinguishable
government grants, the whole should be recognized as income-related grants.
Government grants related to assets are recognized as deferred income and are recognized in profit
or loss in a reasonable and systematic manner over the useful life of the relevant assets.
Government grants related to income, used to compensate for related costs or losses that have
already occurred, shall be included in the current period's profit and loss; If it is used to compensate
for related costs or losses in the future period, it shall be recognized in deferred income and
recognized in the current period's profit or loss or offset against related costs during the recognition
period of related costs or losses. Government grants measured at nominal amounts are directly
recognized in the current period's profit and loss. The Company adopts a consistent approach for
handling the same or similar government grants businesses.
Government grants related to daily activities are recognized in other income based on the essence of
economic transactions. Government grants unrelated to daily activities are included in non
operating income.
When the recognized government grants need to be returned, the carrying amount of the assets shall
be adjusted if the carrying amount of related assets is written down during the initial recognition; if
there is the balance of related deferred income, the book balance of related deferred income shall be
112
Beijing Shougang Co. Ltd Annual Report 2023
written off, and the excess part shall be recognized in the current profit or loss; for the other
circumstances, the government grants shall be recognized in the current profit or loss directly.
29. Deferred tax assets and deferred tax liabilities
Income tax comprises current tax and deferred tax, and is normally recognized as income tax
expense in profit or loss, except for goodwill generated in a business combination or related
deferred tax items that have been recognized directly in equity.
Based on the differences between the carrying amount of an asset or liability in the statement of
financial position and its tax base, the Company adopts the liability method for the provision of
deferred tax.
A deferred tax liability is recognized in respect of all taxable temporary differences except those
arising from the following transactions:
(1) The initial recognition of goodwill; or the initial recognition of an asset or liability in a
transaction which is not a business combination, and at the time of the transaction, affects neither
accounting profit nor taxable profit (Excluding individual transactions that result in equal taxable
temporary differences and deductible temporary differences due to initially recognized assets and
liabilities);
(2) As for the temporary differences associated with subsidiaries, joint ventures and associates: the
Company is able to control the timing of the reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable future.
A deferred tax asset is recognized in respect of all deductible temporary differences to the extent
that it is probable that taxable profit will be available against which the deductible temporary
difference will be utilized except those arising from the initial recognition of an asset or liability in
a transaction which:
(1) The transaction is not a business combination, and at the time of the transaction, affects neither
accounting profit nor taxable profit (Excluding individual transactions that result in equal taxable
temporary differences and deductible temporary differences due to initially recognized assets and
liabilities);
(2) As for deductible temporary differences associated with subsidiaries, joint ventures and
associates: a deferred tax asset is recognized to the extent that it is probable that the temporary
difference will reverse in the foreseeable future, and taxable profit will be available against which
the temporary difference can be utilized.
On the balance sheet date, the Company measures deferred income tax assets and liabilities at the
applicable tax rate during the expected period of asset recovery or liability settlement, and reflects
the income tax impact of the expected method of asset recovery or liability settlement on the
balance sheet date.
On the balance sheet date, the Company reviews the book value of deferred income tax assets. If it
is likely that sufficient taxable income will not be obtained in the future period to offset the benefits
of deferred income tax assets, the book value of deferred income tax assets shall be written down.
When it is highly possible to obtain sufficient taxable income, the amount of write down shall be
reversed.
On the balance sheet date, deferred income tax assets and deferred income tax liabilities are
113
Beijing Shougang Co. Ltd Annual Report 2023
presented at the net amount after offsetting when they simultaneously meet the following
conditions:
(1) The taxpayer within the company has the legal right to settle current income tax assets and
current income tax liabilities on a net basis;
(2) Deferred income tax assets and deferred income tax liabilities are related to the income tax
levied by the same tax administration department on the same taxpayer within the company.
30. Lease
(1) Identification of lease
On the commencement date of the contract, as the lessee or lessor, the Company evaluates whether
the customer in the contract has the right to obtain almost all the economic benefits arising from the
use of the identified assets during the use period, and has the right to dominate the use of the
identified assets during the use period. If one party in the contract transfers the right to control the
use of one or more identified assets within a certain period in exchange for consideration, the
Company recognizes the contract as lease or includes lease.
(2) The Company as lessee
On the beginning date of the lease, the Company recognises right-of-use assets and lease liabilities
for all leases, except for short-term lease and low-value asset lease with simplified approach.
For the right-of-use assets, refers to Note III.31.
Lease liabilities are initially measured according to the present value of the unpaid lease payments
at the beginning of the lease term calculated by the embedded interest rate of the lease. Where the
embedded interest rate cannot be determined, the incremental loan interest rate shall be used as the
discount rate. Lease payments includes: fixed payments and in-substance fixed payments, and
where the lease incentives exists, the lease payment is the payment amount less any lease incentives
receivable; variable lease payments depending on index or ratio; the exercise price of a purchase
option if the lessee is reasonably certain to exercise that option; payments for terminating the lease,
if the lease term reflects the lessee exercising that option of terminating; and amounts expected to
be payable by the lessee under residual value guarantees. Subsequently, the interest expense on the
lease liability for each period during the lease term is calculated using a constant periodic rate of
interest and is recognised in current profit or loss. The variable lease payments that are not included
in the measurement of the lease liability are recognised in profit or loss when actually incurred.
Short-term lease
Short-term leases refer to leases with a lease term of less than 12 months from the commencement
date, except for those with a purchase option.
Lease payments of short-term leases are recognised in the cost of related assets or current profit or
loss on a straight-line basis over the lease term.
For short-term leasing, the Company selects the following types of assets that meet the conditions
for short-term leasing based on the category of leased assets and adopts the simplified processing
method mentioned above.
Low-value asset lease
114
Beijing Shougang Co. Ltd Annual Report 2023
Low-value asset lease refers to the lease with lower value when the single leased asset is a
brand-new asset.
Lease payments of low-value asset lease are recognised in the cost of related assets or current profit
or loss on a straight-line basis over the lease term.
For a low-value asset lease, the Company chooses to adopt the above simplified approach according
to the specific conditions of each lease.
Lease modification
The Company accounts for a lease modification as a separate lease when the modification occurs
and the following conditions are met: ① the lease modification expands the scope of lease by
adding the right to use one or more of the leased assets; and ② the increased consideration is
equivalent to the amount of the separate price for the expansion of the lease scope adjusted
according to the conditions of the contract.
Where the lease modification is not accounted for as a separate lease, on the effective date of the
lease modification, the Company will reallocate the consideration of the contract after the
modification, redefine the lease term, and remeasure the lease liability based on the present value of
the lease payments after the modification and the revised discount rate.
If a lease modification results in reduction in the scope of the lease or a shortening of the lease term,
the Company reduces the carrying amount of the right-of-use asset accordingly and includes the
profit or loss related to the partial or complete termination of the lease is included in the current
profits and losses.
Other lease modifications result in a remeasurement of the lease liability, the Company adjusts the
carrying amount of the right-of-use asset accordingly.
(3) The Company as lessor
When the Company is a lessor, a lease is classified as a finance lease when the terms of the lease
transfer substantially all the risks and rewards of asset ownership to the lessee. All leases other than
financial leases are classified as operating leases.
Finance lease
Under finance lease, the Company accounts for finance lease receivables at the beginning of the
lease term at the net lease investment, which is the sum of the unsecured residual value and the
present value of the lease receipts outstanding at the commencement date of the lease, discounted at
the interest rate implicit in the lease. The Company as lessor calculates and recognises interest
income for each period of the lease term based on a fixed periodic interest rate. Variable lease
payments acquired by the Company as lessor that are not included in the net measurement of lease
investments are included in profit or loss for the period when actually incurred.
Derecognition and impairment of finance lease receivables are accounted for in accordance with the
requirements under the Accounting Standard for Business Enterprises No. 22 – Recognition and
Measurement of Financial Instruments and the Accounting Standards for Business Enterprises No.
23 – Transfer of Financial Assets.
Operating lease
115
Beijing Shougang Co. Ltd Annual Report 2023
Lease payments under operating lease are recognised in profit or loss on a straight-line basis over
the lease term. Initial direct costs incurred in relation to operating leases are capitalised and
amortised over the lease term on the same basis as rental income and recognised in profit or loss for
the according period. The variable lease payments obtained in relation to operating leases that are
not included in the lease payments are recognised in profit or loss in the period when actually
incurred.
Lease modification
Where the operating lease is modified, the Company accounts for the modification as a new lease
from the effective date of the modification. The amount of lease receipts received in advance or
receivable in respect of the lease prior to the modification is treated as a receipt under the new lease.
Where a finance lease is modified and the following conditions are met, the Company accounts for
the modification as a separate lease: ① the lease modification expands the scope of lease by
adding the right to use one or more of the leased assets; and ② the increased consideration is
equivalent to the amount of the separate price for the expansion of the lease scope adjusted
according to the conditions of the contract.
Where a finance lease is modified and not accounted for as a separate lease, the Company accounts
for the modified lease in the following circumstances: ① If the modification effectives on the
lease commencement date, the lease will be classified as an operating lease, the Company accounts
as a new lease from the effective date of the lease modification, and the net amount of the lease
investment before the effective date of the lease modification shall be taken as the book value of the
leased asset; ② If the modification effectives on the lease commencement date, the lease will be
classified as a finance lease, and the Company conducts accounting treatment in accordance with
the Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of
Financial Instruments on modifying or renegotiating contracts.
31. Use-right assets
(1) Recognition conditions of use-right assets
Right-of-use assets refer to the right of the Company as the lessee to use the leased assets during the
lease term.
On the commencement date of the lease term, the use-right assets shall be initially measured at cost.
The cost includes: the initial measurement amount of the lease liability; The lease payment made on
or before the commencement date of the lease term, if there is a lease incentive, shall be deducted
from the amount related to the lease incentive already enjoyed; Initial direct expenses incurred by
the Company as the lessee; The costs expected to be incurred by the Company, as the lessee, to
dismantle and remove the leased assets, restore the leased assets to the site where they are located
or restore the leased assets to the state specified in the lease terms. As the lessee, the Company shall
recognize and measure the costs of demolition and restoration in accordance with the rules“CASBE
13- Contingencies”. Subsequent adjustments are made for any remeasurement of lease liabilities.
(2) Depreciation method of use-right assets
The Company uses the straight-line method of depreciation. If the Company, as the lessee, can
reasonably determine the ownership of the leased asset at the end of the lease term, depreciation
shall be calculated and withdrawn during the remaining service life of the leased asset. Where it is
not reasonably certain that the ownership of the leased asset can be acquired at the end of the lease
116
Beijing Shougang Co. Ltd Annual Report 2023
term, depreciation shall be calculated and withdrawn during the period during which the lease term
and the remaining service life of the leased asset are shorter.
(3) For the impairment test method and impairment provision method of use-right assets, please refer to
Note III. 20.
32. Safety fund and maintenance fee
The Company has accrued safety production fees in accordance with the relevant provisions of the
Ministry of Finance and the Ministry of Emergency Management's Cai Zi [2022] No. 136. The
safety production expenses and maintenance expenses are included in the cost of relevant products
or current profit and loss when accrued, and are also included in the "special reserve" account.
When safety funds and maintenance fees are utilized in compliance with relevant regulations, if the
costs incurred can be categorized as expenditure, the costs incurred should be charged against the
special reserve; if the reserve is used to build up fixed assets, the costs should be charged to
construction in progress, and reclassified to fixed assets when the projects reach the status ready for
intended use. Meantime, expenditures in building up fixed assets are directly charged against the
special reserve with the accumulated depreciation recognized at the same amount and the fixed
assets will not be depreciated in the future.
33. Share repurchase
The shares repurchased by the Company shall be managed as treasury shares before cancellation or
transfer, and all expenses related to repurchased shares shall be transferred to the cost of treasury
shares. The consideration and transaction costs paid in share repurchase reduce owner's equity, and
no gains or losses are recognized when repurchasing, transferring, or canceling the company's
shares.
When transferring treasury shares, the difference between the actual amount received and the book
value of the treasury shares shall be included in the capital reserve. If the capital reserve is
insufficient to offset, the surplus reserve and undistributed profits shall be offset. Cancellation of
treasury shares shall reduce the share capital based on the face value and number of cancelled
shares, and offset the capital reserve based on the difference between the book balance and face
value of cancelled treasury shares. If the capital reserve is insufficient to offset, offset the surplus
reserve and undistributed profits.
34. Significant accounting judgments and estimates
The Company provides continuous assessment of the reasonable expectations of future events, the
critical accounting estimates and key assumptions based on the historical experience and other
factors. The critical accounting estimates and key assumptions that are likely to lead to significant
adjustment risks of the carrying amount of assets and liabilities for the next accounting period are
listed as follows:
Classification of financial assets
The major judgments of the Company involved in determining the classification of financial assets
includes the analysis of business models and the characteristics of contract cash flows, etc.
At the level of financial assets portfolio, the Company determines the business model for managing
financial assets, taking into account factors such as methods of evaluating and reporting financial
assets performance to key managers, the risks of affecting financial assets performance and risk
117
Beijing Shougang Co. Ltd Annual Report 2023
management methods, and the way in which relevant business managers are paid.
In assessing whether the contract cash flow of financial assets is consistent with the basic lending
arrangements, the Company has the following judgments: whether the principal’s time distribution
or amount may change during the lifetime for early repayment and other reasons; whether the
interest only includes the time value of money, credit risk, other basic lending risks and the
consideration with cost and profit. For example, whether the advance payment only reflects the
unpaid principals and interests based on the unpaid principal, and reasonable compensation paid for
the early termination of the contract.
Measurement of expected credit loss of account receivables
The Company calculates the expected credit losses of accounts receivable through default risk
exposure and expected credit losses rate, and determines the expected credit losses rate on the basis
of default probability and default loss rate. In determining the expected credit losses rate, the
Company uses the experience of internal historical credit loss, and adjusts the historical data with
current situation and forward-looking information. In considering forward-looking information, the
indicators include the risks of economic downturn, external market environment, technological
environment and changes of customer conditions. The Company monitors and reviews regularly the
assumptions related to the calculation of expected credit losses.
Deferred tax assets
Deferred tax assets are recognized to the extent that it is probable that taxable profit will be
available against which the deductible temporary difference and unused tax credit can be utilized.
Significant management judgement is required to determine the amount of deferred tax assets that
can be recognized, based upon the likely timing and level of future taxable profits together with tax
planning strategies.
Determination of unlisted equity investment fair value
The fair value of unlisted equity investment is the estimated future cash flow discounted by the
current discount rate of the project with similar terms and risk characteristics. The valuation
requires the Company to estimate the expected future cash flow and discount rate and is therefore
uncertain. Under limited circumstances, if the information used to determine the fair value is
insufficient, or the possible estimates of the fair value are widely distributed, and the cost represents
the best estimate of the fair value within the range, the cost could represent the appropriate estimate
of the fair value within the distribution range.
35. Changes in significant accounting policies and estimates
(1) Changes in significant accounting policies
① Accounting Standards for Business Enterprises Interpretation No. 16
The Ministry of Finance issued Interpretation No. 16 of the Accounting Standards for Enterprises
(Caihui [2022] No. 31) in November 2022 (hereinafter referred to as "Interpretation No. 16").
Interpretation No. 16 stipulates that for a single transaction that is not a business merger, does not
affect accounting profits or taxable income (or deductible losses) at the time of transaction, and
results in equal taxable temporary differences and deductible temporary differences due to the
initial recognition of assets and liabilities, the corresponding deferred income tax liabilities and
deferred income tax assets shall be recognized separately at the time of transaction in accordance
118
Beijing Shougang Co. Ltd Annual Report 2023
with relevant provisions such as Enterprise Accounting Standard No. 18- Income Tax. For the
above-mentioned transactions that occurred between the beginning of the earliest period for the first
implementation of the above regulations in financial statement presentation and the date of
implementation of this interpretation, the enterprise shall adjust the cumulative impact to the
beginning retained earnings and other related financial statement items in the earliest period for
financial statement presentation in accordance with the above regulations. The above accounting
treatment regulations will be implemented from January 1, 2023.
For the taxable temporary differences and deductible temporary differences arised from the
recognision of lease liabilities and right of use assets by the Company for leasing business,
adjustments shall be made in accordance with the provisions of Interpretation No. 16.
The impact of implementing the above accounting policies on the consolidated balance sheet as of
December 31, 2023 and the consolidated income statement for the year 2023 is as follows:
Consolidated balance sheet items
Affected amount
(December 31, 2023)
Deferred tax assets 86,977,838.59
Deferred tax liabilities 85,684,032.63
Consolidated income statement items
Affected amount
(FY 2023)
Income tax expense -1,293,805.96
The impact of implementing the above accounting policies on the consolidated balance sheet as of
December 31, 2022 and the consolidated income statement for the year 2022 is as follows:
Consolidated balance sheet items Before After
Adjustment
(December 31, 2022) adjustment adjustment
Deferred tax assets 402,355,955.31 18,075,395.43 420,431,350.74
Deferred tax liabilities 502,268,362.26 18,075,395.43 520,343,757.69
Consolidated income statement items Before After
Adjustment
(FY 2022) adjustment adjustment
Income tax expense 283,698,478.31 -- 283,698,478.31
The impact of implementing the above accounting policies on the consolidated balance sheet as of
January 1, 2022 is as follows:
Consolidated balance sheet items Before After
Adjustment
(January 1, 2022) adjustment adjustment
Deferred tax assets 189,721,423.29 21,468,073.51 211,189,496.80
Deferred tax liabilities 208,958,292.75 21,468,073.51 230,426,366.26
② The cumulative impact of changes in accounting policies in this period
The implementation of the above accounting policies has not had a significant impact on the
financial statements of the Company.
119
Beijing Shougang Co. Ltd Annual Report 2023
(2) Changes in significant accounting estimates
The Company did not have any change in significant accounting estimates during the year.
IV. Tax
1. Main types of taxes and corresponding tax rates
Tax type Tax basis Tax rate%
Taxable Value Added (The taxable amount is
calculated by multiplying the taxable sales amount by
Value-added tax 13/9/6
the applicable tax rate and deducting the input tax
allowed for deduction in the current period)
City construction
Levy based on the actual paid value-added tax 7/5
and maintenance tax
Education surcharge Levy based on the actual paid value-added tax 3
Local education surcharge Levy based on the actual paid value-added tax 2
Income tax Taxable Income 25
2. Tax preferential benefits and approvals
On 25 October 2021, the Company obtained the high-tech enterprise certificate issued by Beijing
Municipal Science and Technology Commission with the certificate number of GR202111003103
and the certificate is valid for three years.
On 14 September 2021, Beijing Shougang Cold Rolling Co., Ltd., a subsidiary of the Company
obtained the high-tech enterprise certificate issued by Beijing Municipal Science and Technology
Commission with the certificate number of GR202111000699 and the certificate is valid for three
years.
On 18 September 2021, Shougang Jingtang United Iron & Steel Co., Ltd., a subsidiary of the
Company, obtained the high-tech enterprise certificate issued by Hebei Science and Technology
Commission with the certificate number of GR202113000808 and the certificate is valid for three
years.
On 18 October 2022, Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd., a subsidiary of
the Company, obtained the high-tech enterprise certificate issued by Hebei Science and Technology
Commission with the certificate number of GR202213001060 and the certificate is valid for three
years.
On September 3, 2023, the Ministry of Finance and the State Administration of Taxation issued a
notice on the policy of adding and deducting value-added tax for advanced manufacturing
enterprises (Caishui [2023] No. 43), allowing advanced manufacturing enterprises to add 5% of the
current deductible input tax to offset the payable value-added tax from January 1, 2023 to
December 31, 2027. According to this policy, our company will enjoy the above preferential
policies for the year 2023.
120
Beijing Shougang Co. Ltd Annual Report 2023
V. Notes to consolidated financial statements
1. Cash at bank and on hand
Item 2023.12.31 2022.12.31
Cash on hand 33,669.68 23,581.90
Bank deposits 8,906,802,642.00 8,330,041,178.17
Including: financial companies deposited 8,900,208,670.91 7,693,973,274.02
Other monetary assets 246,369,314.69 1,140,407,761.98
Including: financial companies deposited 228,400,000.00 1,088,690,000.00
Total 9,153,205,626.37 9,470,472,522.05
Including: total amount of funds stored overseas 1,898,333.02 --
(1) As at December 31, 2023, except for RMB 196,369,301.95 of security deposit, RMB
50,000,000.00 of fixed term deposit, the Company has no balance of cash and cash equivalents that
are pledged, guaranteed or blocked frozen or overseas balances that restricted to remittance back.
(2) Bank deposits include interest receivable from deposits of RMB 2,175,646.34. This part of
interest does not belong to "cash and cash equivalents."
2. Notes receivable
2023.12.31
Item
Book balance Bad debt provision Carrying value
Bank acceptance notes 1,435,554,918.92 1,435,554.92 1,434,119,364.00
Commercial acceptance notes 2,526,542,362.18 2,526,542.35 2,524,015,819.83
Total 3,962,097,281.10 3,962,097.27 3,958,135,183.83
Continued:
2022.12.31
Item
Book balance Bad debt provision Carrying value
Bank acceptance notes 1,096,900,639.55 1,096,900.64 1,095,803,738.91
Commercial acceptance notes 5,600,883,165.11 5,600,883.17 5,595,282,281.94
Total 6,697,783,804.66 6,697,783.81 6,691,086,020.85
(1) The pledged notes receivable of the Company at the end of the year
Item Amount pledged at the end of the year
Commercial acceptance notes 284,201,490.24
(2) Outstanding endorsed or discounted notes that have not matured at the end of the year
121
Beijing Shougang Co. Ltd Annual Report 2023
Amount derecognized as of December Amount not-derecognized as of December
Item
31, 2023 31, 2023
Bank acceptance notes -- 1,102,142,826.07
Commercial acceptance notes -- 2,354,044,085.43
Total -- 3,456,186,911.50
(3) Notes transferred to accounts receivable due to non-performance of the issuers at the end of the
year
Item Amount transferred to accounts receivable as of December 31, 2023
Commercial acceptance notes 4,123,997.19
(3) Classified by bad debt provision method
2023.12.31
Category Book balance Bad debt provision
Carrying value
Proportion Expected credit loss
Amount Amount
(%) (%)
Assessed bad debt
-- -- -- -- --
provision individually
Assessed bad debt
provision in portfolios
3,962,097,281.10 100.00 3,962,097.27 0.10 3,958,135,183.83
based on credit risk
characteristics
Portfolio 1 -- -- -- -- --
Portfolio 2 3,962,097,281.10 100.00 3,962,097.27 0.10 3,958,135,183.83
Total 3,962,097,281.10 100.00 3,962,097.27 0.10 3,958,135,183.83
Continued:
2022.12.31
Category Book balance Bad debt provision
Carrying value
Proportion Expected credit loss
Amount Amount
(%) (%)
Assessed bad debt
-- -- -- -- --
provision individually
Assessed bad debt
provision in portfolios
6,697,783,804.66 100.00 6,697,783.81 0.10 6,691,086,020.85
based on credit risk
characteristics
Portfolio 1 -- -- -- -- --
Portfolio 2 6,697,783,804.66 100.00 6,697,783.81 0.10 6,691,086,020.85
Total 6,697,783,804.66 100.00 6,697,783.81 0.10 6,691,086,020.85
(5) Provision, recovery or reversal of bad debt
Item Bad debt provision
122
Beijing Shougang Co. Ltd Annual Report 2023
Item Bad debt provision
Opening balance 6,697,783.81
Provision --
Recovery or reversal 2,735,686.54
Closing balance --
(6) There is no notes receivable written off during the reporting period.
3. Accounts receivable
(1) Disclosed by the ageing
Ageing 2023.12.31 2022.12.31
Within 1 year 1,411,727,072.17 1,492,629,056.11
1 – 2 years 3,579,859.18 13,542,310.43
2 – 3 years 7,373,272.12 3,980,837.55
Over 3 years 4,770,547.62 13,036,557.92
Subtotal 1,427,450,751.09 1,523,188,762.01
Less: provision for bad debts 61,817,025.89 73,179,864.91
Total 1,365,633,725.20 1,450,008,897.10
(2) Disclosed by bad debt provision
2023.12.31
Category Book balance Bad debt provision
Expected credit Carrying value
Amount Proportion (%) Amount
loss (%)
Assessed bad debt
4,770,547.62 0.33 4,770,547.62 100.00 --
provision individually
Assessed bad debt
provision in portfolios
1,422,680,203.47 99.67 57,046,478.27 4.01 1,365,633,725.20
based on credit risk
characteristics
Total 1,427,450,751.09 100.00 61,817,025.89 4.33 1,365,633,725.20
Disclosed by bad debt provision (continued):
2022.12.31
Category Book balance Bad debt provision
Expected Carrying value
Amount Proportion (%) Amount
credit loss (%)
Assessed bad debt
13,036,557.92 0.86 13,036,557.92 100.00 --
provision individually
Assessed bad debt
provision in portfolios
1,510,152,204.09 99.14 60,143,306.99 3.98 1,450,008,897.10
based on credit risk
characteristics
123
Beijing Shougang Co. Ltd Annual Report 2023
2022.12.31
Category Book balance Bad debt provision
Expected Carrying value
Amount Proportion (%) Amount
credit loss (%)
Total 1,523,188,762.01 100.00 73,179,864.91 4.80 1,450,008,897.10
Assessed bad debt provision individually:
2023.12.31
Accounts receivable
(by debtor) Expected credit loss Reason for
Book balance Bad debt provision
(%) bad debts
Accounts receivable over 3
646,550.43 646,550.43 100.00 Long aging
years
Overdue recourse notes 4,123,997.19 4,123,997.19 100.00 Overdue recourse notes
Total 4,770,547.62 4,770,547.62 100.00
Continued:
2022.12.31
Accounts receivable
(by debtor) Expected credit loss Reason for
Book balance Bad debt provision
(%) bad debts
Accounts receivable over 3
7,362,963.07 7,362,963.07 100.00 Long aging
years
Overdue recourse notes 5,673,594.85 5,673,594.85 100.00 Overdue recourse notes
Total 13,036,557.92 13,036,557.92 100.00
Assessed bad debt provision in portfolios:
2023.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
Within 1 year 1,411,727,072.17 50,467,105.47 3.57
1 – 2 years 3,579,859.18 1,069,967.11 29.89
2 – 3 years 7,373,272.12 5,509,405.69 74.72
Over 3 years -- -- --
Total 1,422,680,203.47 57,046,478.27 4.01
Continued:
2022.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
Within 1 year 1,492,629,056.11 53,147,749.56 3.56
1 – 2 years 13,542,310.43 4,032,265.53 29.78
2 – 3 years 3,980,837.55 2,963,291.90 74.44
Over 3 years -- -- --
124
Beijing Shougang Co. Ltd Annual Report 2023
2022.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
Total 1,510,152,204.09 60,143,306.99 3.98
(3) Provision, recovery or reversal of bad debt
Item Bad debt provision
Opening balance 73,179,864.91
Provision --
Recovery or reversal 11,362,839.02
Closing balance --
(4) There is no accounts receivable write-off during reporting period.
(5) The top five accounts receivable classified by debtors are as follows:
During the year, the total amount of the top five accounts receivable collected by debtors at the end
of the period is RMB735,908,803.70, accounts for 51.55% of the total amount of accounts
receivable at the end of the period, and the total amount of the corresponding bad debt provision at
the end of the period is RMB 26,307,625.57.
Closing balance
Percentage of total
Company Name Closing balance of bad
accounts receivable (%)
debt provision
Shougang Casey Steel Co., Ltd. 264,947,857.43 18.56 9,471,484.77
China First Automobile Co., Ltd. 188,849,244.42 13.23 6,751,074.57
BYD (Shenzhen)Supply Chain Management
100,538,266.93 7.04 3,594,090.83
Co., Ltd.
BMW Brilliance Automotive Ltd. 94,541,837.25 6.62 3,379,727.55
Chongqing Procurement Branch of Great Wall
87,031,597.67 6.10 3,111,247.85
Motors Co., Ltd
Total 735,908,803.70 51.55 26,307,625.57
4. Financing receivable
Item 2023.12.31 2022.12.31
Notes receivable 2,223,431,426.46 3,489,134,871.56
Less：Other comprehensive income - fair value changes -- --
Closing balance of fair value 2,223,431,426.46 3,489,134,871.56
The Company discounts and endorses a portion of bank acceptance bills based on the needs of daily
fund management, therefore the bank acceptance notes are classified as financial assets at fair value
through other comprehensive income.
(1) Classified by bad debt provision method
125
Beijing Shougang Co. Ltd Annual Report 2023
2023.12.31
Category Book balance Bad debt provision
Carrying value
Expected credit
Amount Proportion (%) Amount
loss (%)
Assessed bad debt
provision -- -- -- -- --
individually
Assessed bad debt
provision in
portfolios based on 2,223,876,201.69 100.00 444,775.23 0.02 2,223,431,426.46
credit risk
characteristics
Portfolio 1 2,223,876,201.69 100.00 444,775.23 0.02 2,223,431,426.46
Portfolio 2 -- -- -- -- --
Total 2,223,876,201.69 100.00 444,775.23 0.02 2,223,431,426.46
Continued:
2022.12.31
Category Book balance Bad debt provision
Carrying value
Expected credit
Amount Proportion (%) Amount
loss (%)
Assessed bad debt
provision -- -- -- -- --
individually
Assessed bad debt
provision in
portfolios 3,489,832,838.11 100.00 697,966.55 0.02 3,489,134,871.56
based on credit risk
characteristics
Portfolio 1 3,489,832,838.11 100.00 697,966.55 0.02 3,489,134,871.56
Portfolio 2 -- -- -- -- --
Total 3,489,832,838.11 100.00 697,966.55 0.02 3,489,134,871.56
(2) Provision, recovery or reversal of bad debt
Item Bad debt provision
Opening balance 697,966.55
Provision --
Recovery or reversal 253,191.32
Written-off --
Closing balance 444,775.23
(3) The pledged notes receivable of the Company at the end of the year
Item Pledged amount at the end of the year
Bank acceptance notes 13,000,000.00
126
Beijing Shougang Co. Ltd Annual Report 2023
(4) Outstanding endorsed or discounted notes that have not matured at the end of the year
Amount derecognized at the end of the Amount not-derecognized at the end of the
Item
year year
Bank acceptance notes 34,352,891,721.24 --
Commercial acceptance notes -- --
Total 34,352,891,721.24 --
5. Prepayments
(1) Disclosed by the ageing of prepayments
2023.12.31 2022.12.31
Ageing
Amount Proportion (%) Amount Proportion (%)
Within 1 year 2,095,132,119.83 99.21 630,526,142.92 99.07
1 – 2 years 16,029,793.14 0.76 4,353,052.19 0.68
2 – 3 years -- -- 859,392.60 0.14
Over 3 years 729,631.83 0.03 730,629.27 0.11
Total 2,111,891,544.80 100.00 636,469,216.98 100.00
(2) As at December 31, 2023, there is no material prepayment with an aging of over 1 year.
(3) The top five prepayments classified by debtors are as follows:
During the year, the total amount of the top five prepayments classified by debtors at the end of the
period is RMB 1,632,577,027.17, accounts for 77.31% of the total amount of prepayments at the end
of the period.
Percentage of total
Company Name 2023.12.31
prepayments (%)
Shougang Group Co., Ltd. 959,767,074.26 45.45
Tangshan Caofeidian Ganglian Logistics Co., Ltd. 312,574,923.41 14.80
Beijing Hegang Steel Trade Co., Ltd. 256,760,387.02 12.16
Shanxi Coking Co., Ltd. 53,668,861.21 2.54
Wuhan Hongda Ruike Automotive Parts Co., Ltd 49,805,781.27 2.36
Total 1,632,577,027.17 77.31
6. Other receivables
Item 2023.12.31 2022.12.31
Dividends receivable 2,407,634.67 200,000.00
Other receivables 7,102,275.11 12,968,697.56
Total 9,509,909.78 13,168,697.56
127
Beijing Shougang Co. Ltd Annual Report 2023
(1) Dividends receivable
Item 2023.12.31 2022.12.31
Guangzhou Jinghai Shipping Co., Ltd. -- 200,000.00
Hebei Jingji Industry & Trading Co., Ltd. 2,407,634.67 --
Subtotal 2,407,634.67 200,000.00
Less: bad debt provision -- --
Total 2,407,634.67 200,000.00
(2) Other receivables
①Disclosed by the ageing of other receivables
Ageing 2023.12.31 2022.12.31
Within 1 year 5,120,670.55 9,880,237.95
1 – 2 years 79,076.40 3,309,333.81
2 – 3 years 2,293,030.11 143,721.00
3 – 4 years 1,395.00 1,074,861.94
4 – 5 years 30,999.94 813,907.90
Over 5 years 6,255,415.11 5,143,256.32
Subtotal 13,780,587.11 20,365,318.92
Less: provision for bad debts 6,678,312.00 7,396,621.36
Total 7,102,275.11 12,968,697.56
②Disclosed by nature of other receivables
2023.12.31
Item Closing
Provision for bad debts Carrying value
balance
Petty cash 250,018.71 20,250.95 229,767.76
Deposits 6,418,024.34 785,678.17 5,632,346.17
Due from other companies 4,807,494.46 3,567,333.28 1,240,161.18
Court debit 2,305,049.60 2,305,049.60 --
Total 13,780,587.11 6,678,312.00 7,102,275.11
Continued:
2022.12.31
Item Closing
Provision for bad debts Carrying value
balance
Petty cash 1,550,710.10 483,358.60 1,067,351.50
Deposits 11,399,556.26 864,254.76 10,535,301.50
Due from other companies 5,110,002.96 3,743,958.40 1,366,044.56
128
Beijing Shougang Co. Ltd Annual Report 2023
2022.12.31
Item Closing
Provision for bad debts Carrying value
balance
Court debit 2,305,049.60 2,305,049.60 --
Total 20,365,318.92 7,396,621.36 12,968,697.56
③Provision for bad debts
As at 31 December 2023, Phase I bad debts provision:
Expected credit
Provision for bad
Category Book balance loss within 12 Carrying value
debts
months (%)
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
5,120,670.55 5.00 256,033.52 4,864,637.03
portfolios
Petty cash and deposits 4,360,962.05 5.00 218,048.12 4,142,913.93
Due from other companies 759,708.50 5.00 37,985.40 721,723.10
Total 5,120,670.55 5.00 256,033.52 4,864,637.03
As at 31 December 2023, Phase II bad debts provision:
Expected credit
Provision for bad
Category Book balance loss within the Carrying value
debts
lifetime (%)
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
3,118,409.35 28.24 880,771.27 2,237,638.08
portfolios
Petty cash and deposits 2,306,000.00 25.45 586,800.00 1,719,200.00
Due from other companies 812,409.35 36.19 293,971.27 518,438.08
Total 3,118,409.35 28.24 880,771.27 2,237,638.08
As at 31 December 2023，Phase III bad debts provision:
Expected credit
Provision for bad
Category Book balance loss over the Carrying value
debts
lifetime (%)
Assessed bad debt provision
individually
Henan Taihang Vibrating Machinery
2,305,049.60 100.00 2,305,049.60 --
Co., Ltd.
Due from other companies over 5 years 3,236,457.61 100.00 3,236,457.61 --
Total 5,541,507.21 100.00 5,541,507.21 --
As at 31 December 2022, Phase I bad debts provision:
Expected credit
Provision for bad
Category Book balance loss within 12 Carrying value
debts
months (%)
129
Beijing Shougang Co. Ltd Annual Report 2023
Expected credit
Provision for bad
Category Book balance loss within 12 Carrying value
debts
months (%)
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
9,880,237.95 5.00 494,011.88 9,386,226.07
portfolios
Petty cash and deposits 9,046,161.66 5.00 452,308.08 8,593,853.58
Due from other companies 834,076.29 5.00 41,703.80 792,372.49
Total 9,880,237.95 5.00 494,011.88 9,386,226.07
As at 31 December 2022, Phase II bad debts provision:
Expected credit
Provision for bad
Category Book balance loss within the Carrying value
debts
lifetime (%)
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
4,327,962.65 17.22 745,491.16 3,582,471.49
portfolios
Petty cash and deposits 3,532,303.64 14.82 523,504.28 3,008,799.36
Due from other companies 795,659.01 27.90 221,986.88 573,672.13
Total 4,327,962.65 17.22 745,491.16 3,582,471.49
As at 31 December 2022，Phase III bad debts provision:
Expected credit loss Provision for bad
Category Book balance Carrying value
over the lifetime (%) debts
Assessed bad debt provision
individually
Henan Taihang Vibrating Machinery
2,305,049.60 100.00 2,305,049.60 --
Co., Ltd.
Petty cash over 5 years 370,720.00 100.00 370,720.00 --
Due from other companies over 5 years 3,481,348.72 100.00 3,481,348.72 --
Total 6,157,118.32 100.00 6,157,118.32 --
④Provision, recovery or reversal of bad debt
Phase I Phase II Phase III
Expected credit loss
Provision for bad debts Expected credit Expected credit loss Total
over the lifetime
loss within 12 over the lifetime (no
(credit impairment
months credit impairment)
occurred)
Beginnging balance 494,011.88 745,491.16 6,157,118.32 7,396,621.36
Changes during the year -- -- -- --
-- Shift to Phase II -- -- -- --
-- Shift to Phase III -- -- -- --
-- Back to Phase II -- -- -- --
130
Beijing Shougang Co. Ltd Annual Report 2023
Phase I Phase II Phase III
Expected credit loss
Provision for bad debts Expected credit Expected credit loss Total
over the lifetime
loss within 12 over the lifetime (no
(credit impairment
months credit impairment)
occurred)
-- Back to Phase I -- -- -- --
Provision -- 135,280.11 -- 135,280.11
Reversal 237,978.36 -- 615,611.11 853,589.47
Converse -- -- -- --
Written-off -- -- -- --
Other movements -- -- -- --
Closing balance 256,033.52 880,771.27 5,541,507.21 6,678,312.00
⑤There is no write-off of provision for bad debts during reporting period.
⑥The top five other receivables classified by debtors are as follows:
Percentage of Closing balance
Company Name Nature Closing balance Ageing total other of bad
receivable (%) debt provision
Henan Taihang Vibrating Court
2,305,049.60 Over 5 years 16.73 2,305,049.60
Machinery Co., Ltd. debit
China Petrochemical Security
1,875,361.36 Within 1 year 13.61 93,768.07
International Co., Ltd. fund
China National Chemical
Security
Construction International 600,000.00 Within 1 year 4.35 30,000.00
fund
Tendering Co., Ltd
China Railway Major Bridge Security
600,000.00 Within 1 year 4.35 30,000.00
Engineering Group Co., Ltd. fund
Zhuzhou Geckor Group Co., Security
525,000.00 2-3 years 3.81 52,500.00
Ltd. fund
Total 5,905,410.96 42.85 2,511,317.67
7. Inventories
(1) Classification of inventories
2023.12.31
Item
Book balance Provision for impairment Carrying value
Raw materials 2,646,014,681.91 38,073,815.60 2,607,940,866.31
Finished goods 5,140,798,217.37 80,895,474.59 5,059,902,742.78
Consumables 673,837,073.34 -- 673,837,073.34
Self-made semi-finished goods 3,952,354,739.89 116,424,836.42 3,835,929,903.47
Total 12,413,004,712.51 235,394,126.61 12,177,610,585.90
Continued:
2022.12.31
Item
131
Beijing Shougang Co. Ltd Annual Report 2023
Book balance Provision for impairment Carrying value
Raw materials 2,887,646,758.41 42,207,819.20 2,845,438,939.21
Finished goods 5,232,868,448.19 109,101,783.90 5,123,766,664.29
Consumables 605,976,815.09 -- 605,976,815.09
Self-made semi-finished goods 3,576,657,167.28 191,592,837.72 3,385,064,329.56
Total 12,303,149,188.97 342,902,440.82 11,960,246,748.15
(2) Impairment provision for inventories or performance costs
Increase Decrease
Item 2023.1. 1 2023.12.31
Reversal or
Provision Others Others
Write-off
Raw materials 42,207,819.20 500,634.69 -- 4,634,638.29 -- 38,073,815.60
Finished goods 109,101,783.90 238,193,699.44 -- 266,400,008.75 -- 80,895,474.59
Self-made semi-finished goods 191,592,837.72 361,404,731.11 -- 436,572,732.41 -- 116,424,836.42
Total 342,902,440.82 600,099,065.24 -- 707,607,379.45 -- 235,394,126.61
8. Other current assets
Item 2023.12.31 2022.12.31
Input value added tax 3,993,436.29 2,814,012.14
Input value added tax to be certified 1,027,726,549.40 655,944,515.37
Prepaid income tax 42,916,429.07 200,264,001.14
Entrusted Loans -- 166,880,103.67
Transfer payment for special steel debt 109,717,639.69 --
Carbon emission rights assets 263,718.45 40,317.17
Value added tax deduction 344,710,144.87 --
Total 1,529,327,917.77 1,025,942,949.49
132
Beijing Shougang Co. Ltd Annual Report 2023
9. Long-term equity investments
Movements during the year
Impairment Investment
Impairment
at the gains and Adjustment Cash
Company Name 2023.1.1 Other Provision 2023.12.31 at the end
beginning Additional Reduce losses of other dividend
equity for Others of the year
of the year investment investment confirmed comprehensive or profit
movement impairment
under the income declared
equity method
①Joint ventures
Tangshan Guoxing
38,183,246.93 -- -- -- 5,996,978.58 -- 2,852.23 1,500,000.00 -- -- 42,683,077.74 --
Industrial Co., Ltd.
Tangshan Zhonghong
9,640,303.21 -- -- 1,083,075.06 -8,557,228.15 -- -- -- -- -- -- --
Carbon Chemical Co., Ltd.
Tangshan Shougang
Jingtang Xishan Coking 1,098,143,631.05 -- -- -- 14,406,512.87 -- 368,993.07 20,000,000.00 -- -- 1,092,919,136.99 --
Co., Ltd.
Subtotal 1,145,967,181.19 -- -- 1,083,075.06 11,846,263.30 -- 371,845.30 21,500,000.00 -- -- 1,135,602,214.73 --
②Associates
Tangshan Tangcao Railway
312,745,653.19 -- -- -- -70,627,099.55 -- 46,580.93 -- -- -- 242,165,134.57 --
Co., Ltd.
Tangshan Caofeidian
Dunshi New Construction 67,466,999.44 -- -- -- -5,227,673.16 -- -- 5,000,000.00 -- -- 57,239,326.28 --
Material Co., Ltd.
Qian'an Sinochem Coal
Chemical Industrial Co., 891,510,510.32 -- -- -- -218,489,120.70 -- -- -- -- -- 673,021,389.62 --
Ltd.
Beijing Shouxin Jinyuan
Management Consulting
122,430,402.99 -- -- -- 84,209,307.09 -- -- 77,539,284.02 -- -- 129,100,426.06 --
Center (Limited
Partnership)
Beijing Dingshengcheng
Packaging Materials Co., 16,830,558.74 -- -- -- 4,597,037.20 -- -- -- -- -- 21,427,595.94 --
Ltd.
Ningbo Shougang Zhejin
20,211,004.90 -- -- -- -1,317,064.73 -- 5,816.78 -- -- -- 18,899,756.95 --
Steel Co., Ltd.
Guangzhou Jinghai
28,866,411.30 -- -- -- 22,950.04 -- -- 200,000.00 -- -- 28,689,361.34 --
Shipping Co., Ltd.
Shougang (Qingdao) Steel
58,000,726.24 -- -- -- 1,414,158.20 -- -- 700,000.00 -- -- 58,714,884.44 --
Industry Co., Ltd.
Tianjin Shougang Steel
Processing&Distribution 16,693,129.11 -- -- -- 47,862.59 -- -49,241.27 -- -- -- 16,691,750.43 --
Co., Ltd.
133
Beijing Shougang Co. Ltd Annual Report 2023
Movements during the year
Impairment Investment
Impairment
at the gains and Adjustment Cash
Company Name 2023.1.1 Other Provision 2023.12.31 at the end
beginning Additional Reduce losses of other dividend
equity for Others of the year
of the year investment investment confirmed comprehensive or profit
movement impairment
under the income declared
equity method
Hebei Jingji Industry &
7,828,779.08 -- -- -- 3,219,444.57 -- -- 5,086,876.25 -- -- 5,961,347.40 --
Trading Co., Ltd.
Qian'an Jinyu Shougang
Environmental Protection 35,734,568.85 -- -- -- -2,472,660.25 -- -- -- -- -- 33,261,908.60 --
Technology Co., Ltd.
Subtotal 1,578,318,744.16 -- -- -- -204,622,858.70 -- 3,156.44 88,526,160.27 -- -- 1,285,172,881.63 --
Total 2,724,285,925.35 -- -- 1,083,075.06 -192,776,595.40 -- 375,001.74 110,026,160.27 -- -- 2,420,775,096.36 --
134
Beijing Shougang Co. Ltd Annual Report 2023
10. Other equity instrument investments
Item 2023.12.31 2022.12.31
Beijing TIEKE Shougang RAILWAY-TECH Co., Ltd. 310,601,456.00 197,880,464.00
Minmetals Special Steel (Dongguan) Co., Ltd. 1,786,138.70 4,103,981.86
Qian'an Shoujia Construction Material Co., Ltd. -- 5,456,139.10
Qian'an PetroChina Kunlun Gas Co., Ltd 21,342,418.64 19,084,152.28
Minmetals Tianwei Steel Co., Ltd. 6,474,078.87 6,241,396.57
Total 340,204,092.21 232,766,133.81
Continued:
Other
comprehensive
Dividend Accumulated Accumulated income
Item recognized Reasons
gain loss transferred
during the year
to retained
earnings
Beijing TIEKE Shougang
95,812,843.18 255,765,217.54 3,937,360.00 --
RAILWAY-TECH Co., Ltd.
Minmetals Special Steel
-1,970,166.69 -2,731,782.11 -- --
(Dongguan) Co., Ltd.
Qian'an Shoujia Construction
-4,637,718.24 -19,436,418.75 -- --
Material Co., Ltd.
Qian'an PetroChina Kunlun
1,919,526.41 16,611,055.84 3,474,772.80 --
Gas Co., Ltd
Minmetals Tianwei Steel Co.,
197,779.96 -634,032.96 -- --
Ltd.
Total 91,322,264.62 249,574,039.56 7,412,132.80
11. Other non-current financial assets
Item 2023.12.31 2022.12.31
Financial assets measured at fair value
75,009,218.61 79,234,007.60
through profit and loss
Continued:
Item 2023.12.31 2022.12.31
Beijing Shouxin Jin'an Equity Investment
75,009,218.61 79,234,007.60
Partnership (Limited Partnership)
Note: The fair value and investment of Beijing Shouxin Jin'an Equity Investment Partnership
(Limited Partnership) refer to Note Ⅶ. 4 and Note X.
12. Fixed assets
Item 2023.12.31 2022.12.31
Fixed assets 89,895,037,102.17 93,331,072,969.17
Fixed assets to be disposed -- --
135
Beijing Shougang Co. Ltd Annual Report 2023
Total 89,895,037,102.17 93,331,072,969.17
136
Beijing Shougang Co. Ltd Annual Report 2023
Fixed assets
①Details of fixed assets
Machinery and Metallurgical
Item Plant and buildings Motor vechiles Electronic equipment Industrial furnace Other tools Total
equipment equipment
Cost：
1. At 1 January 2023 38,934,539,623.18 47,546,349,011.50 2,818,452,661.79 10,305,684,242.67 1,328,119,282.41 62,465,727,447.79 1,126,504,291.87 164,525,376,561.21
2. Increase 483,862,736.98 5,615,025,448.74 1,047,612,440.92 1,384,890,184.51 111,758,777.97 -4,355,222,086.31 41,185,038.90 4,329,112,541.71
(1) Purchase 79,581,348.67 84,459,549.14 7,627,492.79 48,414,764.43 84,938,332.04 6,277,432.81 311,298,919.88
(2) Transferred from
construction in progress
404,281,388.31 5,530,565,899.60 1,039,984,948.13 1,336,475,420.08 111,758,777.97 -4,440,160,418.35 34,907,606.09 4,017,813,621.83
3. Decrease 16,606,436.19 31,967,740.43 46,441,470.62 15,779,198.32 -- 31,039,860.38 4,464,790.86 146,299,496.80
(1) Disposal or retirement 16,606,436.19 31,967,740.43 46,441,470.62 15,779,198.32 -- 31,039,860.38 4,464,790.86 146,299,496.80
4. At 31 December 2023 39,401,795,923.97 53,129,406,719.81 3,819,623,632.09 11,674,795,228.86 1,439,878,060.38 58,079,465,501.10 1,163,224,539.91 168,708,189,606.12
Accumulated depreciation:
1. At 1 January 2023 12,252,168,847.57 19,574,553,859.62 1,998,285,554.89 6,561,030,235.99 644,940,661.15 29,673,771,570.40 489,552,862.42 71,194,303,592.04
2. Increase 1,301,080,521.41 5,058,474,034.97 723,463,167.87 1,314,428,653.33 94,509,563.18 -849,506,621.19 93,089,819.07 7,735,539,138.64
(1) Depreciation 1,281,394,033.31 2,494,347,069.38 191,390,881.97 611,822,015.14 75,737,384.05 2,994,337,918.40 86,509,836.39 7,735,539,138.64
(2) Other increases 19,686,488.10 2,564,126,965.59 532,072,285.90 702,606,638.19 18,772,179.13 -3,843,844,539.59 6,579,982.68 --
3. Decrease 3,477,194.33 23,692,641.77 43,718,891.01 14,700,251.00 -- 27,679,841.04 3,421,407.58 116,690,226.73
(1) Disposal or retirement 3,477,194.33 23,692,641.77 43,718,891.01 14,700,251.00 -- 27,679,841.04 3,421,407.58 116,690,226.73
4. At 31 December 2023 13,549,772,174.65 24,609,335,252.82 2,678,029,831.75 7,860,758,638.32 739,450,224.33 28,796,585,108.17 579,221,273.91 78,813,152,503.95
Impaiment
1. At 1 January 2023 -- -- -- -- -- -- -- --
137
Beijing Shougang Co. Ltd Annual Report 2023
Machinery and Metallurgical
Item Plant and buildings Motor vechiles Electronic equipment Industrial furnace Other tools Total
equipment equipment
2. Increase -- -- -- -- -- -- -- --
3. Decrease -- -- -- -- -- -- -- --
4. At 31 December 2023 -- -- -- -- -- -- -- --
Carrying value
1. 31 December 2023 25,852,023,749.32 28,520,071,466.99 1,141,593,800.34 3,814,036,590.54 700,427,836.05 29,282,880,392.93 584,003,266.00 89,895,037,102.17
2. 1 January 2023 26,682,370,775.61 27,971,795,151.88 820,167,106.90 3,744,654,006.68 683,178,621.26 32,791,955,877.39 636,951,429.45 93,331,072,969.17
138
Beijing Shougang Co. Ltd Annual Report 2023
Note: As at 31 December 2023, there is no mortgaged or guaranteed fixed assets.
②As at 31 December 2023, there is no temporarily idle fixed assets.
③As at 31 December 2023, fixed assets leased through operating leases are as follows:
Item Carrying value
Plant and buildings 104,212,352.21
④Fixed assets pending certificates of ownership
Item Carrying value Reasons for pending certificates
Property of Beijing Shougang Cold Rolling
34,888,371.00 Property certificate is in the process
Co., Ltd.
Property of Beijing Shougang Co., Ltd. 105,814,346.03 Property certificate is in the process
Property of Beijing Shougang Steel Trading
72,550,845.23 Property certificate is in the process
Investment Management Co., Ltd.
13. Construction in progress
Item 2023.12.31 2022.12.31
Construction in progress 5,279,317,813.90 7,598,541,035.50
Construction materials 41,295,437.98 75,108,817.27
Total 5,320,613,251.88 7,673,649,852.77
(1) Construction in progress
①Details of construction in progress
2023.12.31
Item
Book balance Provision for impairment Carrying value
Jingtang technical renovation project 714,355,677.48 -- 714,355,677.48
New energy automotive electrical steel
84,878,191.46 -- 84,878,191.46
project
Zhixin Co. oriented phase II project 71,554,023.86 -- 71,554,023.86
Zhixin Co. high-end heat treatment
1,315,631,740.70 -- 1,315,631,740.70
engineering project
Qiangang technical renovation project 2,094,608,579.82 -- 2,094,608,579.82
Other projects 998,289,600.58 -- 998,289,600.58
Total 5,279,317,813.90 -- 5,279,317,813.90
Continued:
2022.12.31
Item
Book balance Provision for impairment Carrying value
Jingtang technical renovation project 3,076,233,760.72 -- 3,076,233,760.72
139
Beijing Shougang Co. Ltd Annual Report 2023
2022.12.31
Item
Book balance Provision for impairment Carrying value
New energy automotive electrical steel
37,653,248.54 -- 37,653,248.54
project
Zhixin Co. oriented phase II project 1,314,052,905.22 -- 1,314,052,905.22
Zhixin Co. high-end heat treatment
183,731,602.88 -- 183,731,602.88
engineering project
Qiangang technical renovation project 1,484,877,863.66 -- 1,484,877,863.66
Other projects 1,501,991,654.48 -- 1,501,991,654.48
Total 7,598,541,035.50 -- 7,598,541,035.50
②The major construction projects in progress are as follows:
Accumulated Capitalized
Transferred to Other % of interest
Project name 2023.1.1 Additions interest Interest during 2023.12.31
fixed assets deduction capitalization
capitalization reporting year
Zhixin Co.
oriented phase II 1,314,052,905.22 1,922,416.03 1,244,421,297.39 -- -- -- -- 71,554,023.86
project
Zhixin Co.
high-end heat
treatment 183,731,602.88 1,131,900,137.82 -- -- -- -- -- 1,315,631,740.70
engineering
project
Total 1,497,784,508.10 1,133,822,553.85 1,244,421,297.39 -- -- -- -- 1,387,185,764.56
The major construction projects in progress are as follows (continued): (Unit: RMB hundred
million)
The propotion of
Source of
Project name Budget projects investment Progress (%)
fund
account for budget %
Zhixin Co. oriented phase
16.83 88.26 Transfer to fixed assets on estimate value Selfraised
II project
Zhixin Co. high-end heat
treatment engineering 19.49 73.74 The project is undergoing civil construction Selfraised
project
③As at 31 December 2023, there is no provision for impairment of construction in progress.
(2) Construction materials
Item 2023.12.31 2022.12.31
Specific materials 3,298,486.36 12,234,976.71
Specific equipments 37,996,951.62 62,873,840.56
Subtotal 41,295,437.98 75,108,817.27
Provision for impairment of construction
-- --
materials
Total 41,295,437.98 75,108,817.27
14. Right-of-use assets
140
Beijing Shougang Co. Ltd Annual Report 2023
Item Plant and buildings Land use rights Motor vechiles Total
Cost：
1. At 1 January 2023 115,976,725.63 311,888.26 474,802.94 116,763,416.83
2. Increase during the period 439,100,685.41 -- -- 439,100,685.41
(1) Additional lease 436,316,890.81 -- -- 436,316,890.81
(2) Adjustment of lease liabilities 2,783,794.60 -- -- 2,783,794.60
3. Decrease during the period 155,885.58 -- -- 155,885.58
Other decrease 155,885.58 -- -- 155,885.58
4. At 31 December 2023 554,921,525.46 311,888.26 474,802.94 555,708,216.66
Accumulated depreciation
1. At 1 January 2023 33,214,718.55 111,721.20 329,617.63 33,656,057.38
2. Increase during the period 32,979,389.24 55,860.60 128,632.46 33,163,882.30
Provision 32,979,389.24 55,860.60 128,632.46 33,163,882.30
3. Decrease during the period 155,885.58 -- -- 155,885.58
Other decrease 155,885.58 -- -- 155,885.58
4. At 31 December 2023 66,038,222.21 167,581.80 458,250.09 66,664,054.10
Impaiment
1. At 1 January 2023 -- -- -- --
2. Increase during the period -- -- -- --
3. Decrease during the period -- -- -- --
4. At 31 December 2023 -- -- -- --
Carrying value
1. 31 December 2023 488,883,303.25 144,306.46 16,552.85 489,044,162.56
2. 1 January 2023 82,762,007.08 200,167.06 145,185.31 83,107,359.45
Note: As of December 31, 2023, the Company recognizes lease expenses related to short-term
leases and leases of low value assets as shown in Note V, 61.
15. Intangible assets
Details of intangible assets
Item Software Land use rights Total
Cost
1. At 1 January 2023 497,475,518.39 4,591,445,210.91 5,088,920,729.30
2. Increase 16,806,990.57 2,265,472,559.74 2,282,279,550.31
(1) Purchase -- 3,502,128.00 3,502,128.00
(2) Transfer from construction in progress 16,806,990.57 2,261,970,431.74 2,278,777,422.31
141
Beijing Shougang Co. Ltd Annual Report 2023
Item Software Land use rights Total
3. Decrease -- -- --
4. At 31 December 2023 514,282,508.96 6,856,917,770.65 7,371,200,279.61
Accumulated amortization
1. At 1 January 2023 201,774,900.38 980,238,700.81 1,182,013,601.19
2. Increase 41,434,224.14 143,382,374.06 184,816,598.20
Provision 41,434,224.14 143,382,374.06 184,816,598.20
3. Decrease -- -- --
4. At 31 December 2023 243,209,124.52 1,123,621,074.87 1,366,830,199.39
Impairment
1. At 1 January 2023 -- -- --
2. Increase -- -- --
3. Decrease -- -- --
4. At 31 December 2023 -- -- --
Carrying value
1. 31 December 2023 271,073,384.44 5,733,296,695.78 6,004,370,080.22
2. 1 January 2023 295,700,618.01 3,611,206,510.10 3,906,907,128.11
As of December 31, 2023, the Company has no intangible assets with any mortgage, guarantee,
impairment or other situations.
16. Long-term prepaid expenses
Decrease
Item 2023.1.1 Increase 2023.12.31
Amortization Others
Renovation costs 3,535,748.04 2,228,940.09 973,269.04 -- 4,791,419.09
17. Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets and deferred income tax liabilities without offsetting
2023.12.31 2022.12.31
Item Deductible/taxable Deferred tax Deductible/taxable Deferred tax
temporary differences assets/liabilities temporary differences assets/liabilities
Deferred tax assets：
Asset impairment provision 269,626,906.31 43,837,995.70 505,555,574.09 79,322,751.40
Withdrawal amount of payroll
11,968,784.40 1,795,317.66 11,804,882.71 1,770,732.41
payable
Defferred income 418,032,946.24 63,168,702.02 376,219,302.71 56,819,612.63
Asset amortization difference 27,650,565.49 4,147,584.81 5,629,387.82 844,408.16
Unrealized internal transaction 221,305,036.64 33,195,755.50 269,210,907.64 40,381,636.15
142
Beijing Shougang Co. Ltd Annual Report 2023
2023.12.31 2022.12.31
Item Deductible/taxable Deferred tax Deductible/taxable Deferred tax
temporary differences assets/liabilities temporary differences assets/liabilities
Joint commissioning cost 293,407,102.85 44,011,065.43 311,745,046.78 46,761,757.02
Lease liabilities 493,493,671.39 86,977,838.59 3,523,175.04 755,873.27
Equity Incentive 2,074,225.79 320,280.51 6,855,496.85 1,052,157.60
Deferred income assets for loss
1,090,774,966.00 163,616,244.90 1,164,313,511.12 174,647,026.67
provision
Subtotal 2,828,334,205.11 441,070,785.12 2,654,857,284.76 402,355,955.31
Deferred tax liabilities：
Joint commissioning cost 996,181,065.40 149,427,159.81 1,085,461,580.60 162,819,237.09
Other equity instruments
293,616,517.21 44,042,477.65 186,178,558.81 27,926,783.87
investments
Gain on equity disposal -- -- 83,212,329.87 20,803,082.47
Equipment additional deduction 1,835,794,544.82 275,369,181.72 1,938,128,392.15 290,719,258.83
Right-use assets 488,963,025.70 85,684,032.63 -- --
Subtotal 3,614,555,153.13 554,522,851.81 3,292,980,861.43 502,268,362.26
(2) Details of unrecognized deferred tax assets from deductible temporary differences and
deductible tax losses:
Item 2023.12.31 2022.12.31
Deductible temporary differences 49,549,392.54 56,162,050.68
Deductible tax losses 1,817,836,980.09 2,051,259,102.58
Total 1,867,386,372.63 2,107,421,153.26
(3) Unrecognized deferred tax liabilities from deductible tax losses will expire in the following
years:
Years 2023.12.31 2022.12.31 Note
2023 —— 33,894,110.96
2024 33,903,321.35 34,063,776.18
2025 17,290,511.03 18,967,253.01
2026 13,437,096.04 14,769,965.09
2027 1,749,623,032.87 1,949,563,997.34
2028 3,583,018.80 ——
Total 1,817,836,980.09 2,051,259,102.58
18. Restricted assets
2023.12.31
Item
Book balance Carrying value Type of restriction Reason of restriction
143
Beijing Shougang Co. Ltd Annual Report 2023
2023.12.31
Item
Book balance Carrying value Type of restriction Reason of restriction
Security deposits, fixed term depos
Monetary funds 246,369,301.95 246,369,301.95 Frozen
its
Notes receivable 297,201,490.24 297,201,490.24 Pledged Pledge guarantee
Total 543,570,792.19 543,570,792.19
Continued:
2022.12.31
Item
Book balance Carrying value Type of restriction Reason of restriction
Security deposits, fixed term depos
Monetary funds 1,140,407,749.24 1,140,407,749.24 Frozen
its
Notes receivable 328,829,159.08 328,829,159.08 Pledged Pledge guarantee
Accounts
24,223,581.32 24,223,581.32 Pledged Pledge guarantee
receivable
Total 1,493,460,489.64 1,493,460,489.64
19. Short-term loans
Classification of short-term loans
Item 2023.12.31 2022.12.31
Credit loans 21,282,738,873.29 22,671,912,770.04
Pledged loans 284,201,490.24 1,090,000.00
Guaranteed loans 5,094,415,277.76 6,907,003,333.35
Total 26,661,355,641.29 29,580,006,103.39
20. Notes payable
Item 2023.12.31 2022.12.31
Commercial acceptance notes 3,368,752,366.00 7,141,510,000.00
Bank acceptances 65,000,000.00 120,000,000.00
Total 3,433,752,366.00 7,261,510,000.00
21. Accounts payable
Item 2023.12.31 2022.12.31
Payables for goods 18,592,628,297.35 17,215,600,362.40
Payables for construction 2,141,412,412.23 2,594,994,121.65
Total 20,734,040,709.58 19,810,594,484.05
Among which, the material trade payables aged over 1 year was as follows:
Company name 2023.12.31 Reason for non-settlement
Beijing Shougang Resources Comprehensive 46,579,401.86 In the execution
144
Beijing Shougang Co. Ltd Annual Report 2023
Utilization Technology Development Co., Ltd.
Chengdu Huaxi Chemical Technology Co.,
16,663,590.20 In the execution
Ltd
Qinhuangdao Shouqin Metal Materials Co.,
13,303,698.08 In the execution
Ltd.
MCC CCID Engineering Technology Co., Ltd 10,006,250.69 In the execution
Beijing Jingcheng Phoenixfurnace
11,891,531.00 In the execution
Engineering Technology Co., Ltd
Total 98,444,471.83
22. Contract liabilities
Item 2023.12.31 2022.12.31
Advance from product sales 4,699,449,813.28 4,508,016,725.74
Less: contractual liabilities included in other
-- --
non-current liabilities
Total 4,699,449,813.28 4,508,016,725.74
23. Employee benefits payable
Item 2023.1.1 Increase Decrease 2023.12.31
Short-term employee benefits 593,137,177.24 4,035,324,305.25 3,902,233,288.64 726,228,193.85
Post-employment benefits (defined
21,769,252.36 683,416,368.60 674,943,017.77 30,242,603.19
contribution plans)
Termination benefits -- 111,933,739.84 111,933,739.84 --
Other retirement benefits due within one year 5,890,000.00 5,890,000.00
Total 620,796,429.60 4,830,674,413.69 4,689,110,046.25 762,360,797.04
(1) Short-term employee benefits
Item 2023.1.1 Increase Decrease 2023.12.31
Salaries, bonuses and subsidies 145,764,214.16 2,903,844,347.32 2,825,179,927.78 224,428,633.70
Welfare -- 344,895,431.38 344,895,431.38 --
Social insurance 176,331,327.06 341,669,161.11 314,282,422.65 203,718,065.52
Including:
176,123,301.26 314,484,192.70 287,285,145.28 203,322,348.68
1.Medical insurance
2.Work-related injury insurance 206,530.65 27,096,032.02 26,908,764.85 393,797.82
3.Maternity insurance 1,495.15 88,936.39 88,512.52 1,919.02
Housing fund 52,099.00 358,587,957.02 358,582,481.02 57,575.00
Labor union fee and employee education fee
270,989,537.02 97,057,060.52 70,022,677.91 298,023,919.63
employee education fee
Equity incentive -- -12,462,167.10 -12,462,167.10 --
Short-term profit-sharing plan -- -- -- --
Non-monetary benefits -- -- -- --
145
Beijing Shougang Co. Ltd Annual Report 2023
Item 2023.1.1 Increase Decrease 2023.12.31
Other short-term employee benefits -- 1,732,515.00 1,732,515.00 --
Total 593,137,177.24 4,035,324,305.25 3,902,233,288.64 726,228,193.85
(2) Defined contribution plans
Item 2023.1.1 Increase Decrease 2023.12.31
Post-employment benefits
Including:
9,654,550.87 480,833,554.81 481,828,073.14 8,660,032.54
1.Pension insurance
2.Unemployment insurance 12,114,701.49 17,379,338.57 17,576,106.45 11,917,933.61
3. Enterprise Pension -- 185,203,475.22 175,538,838.18 9,664,637.04
Total 21,769,252.36 683,416,368.60 674,943,017.77 30,242,603.19
(3) Termination benefits
Item 2023.1.1 Increase Decrease 2023.12.31
Compensation for employee resettlement -- 111,933,739.84 111,933,739.84 --
24. Taxes payable
Item 2023.12.31 2022.12.31
Value-added tax 137,714,492.68 112,823,148.09
City construction and maintenance tax 777,178.34 939,514.85
Corporate income tax 6,189,412.20 6,615,902.30
Land use tax 440,536.03 440,536.03
Real estate tax 1,361,531.20 1,014,521.32
Education surcharge 600,520.73 681,006.31
Resouorce tax 1,214,784.40 4,912,568.40
Stamp duty 29,910,115.63 33,470,591.03
Individual income tax 872,184.15 2,812,207.41
Environment protection tax 5,828,540.94 8,567,976.00
Other taxes 20,557.38 22,444.66
Total 184,929,853.68 172,300,416.40
25. Other payables
Item 2023.12.31 2022.12.31
Dividends payable -- 11,440,046.38
Other payables 431,690,700.91 2,750,379,230.31
Total 431,690,700.91 2,761,819,276.69
146
Beijing Shougang Co. Ltd Annual Report 2023
(1) Dividends payable
Item 2023.12.31 2022.12.31
Shougang Group Co., Ltd. -- 2,806,049.55
Beijing Shouxin Jinyuan Management -- 6,475,498.15
Consulting Center (Limited Partnership)
Qian'an Jingji Equity Investment Fund -- 2,158,498.68
(Limited Partnership)
Total -- 11,440,046.38
(2) Other payables
Item 2023.12.31 2022.12.31
Deposits 5,749,390.63 6,137,315.23
Guarantee 24,646,861.86 35,705,705.74
Due from Shougang Group 56,517,064.49 56,575,231.05
Due from Shougang Mining Corp. -- 796,194,091.55
Restricted stock repurchase obligations 130,627,194.09 210,930,850.00
Zhixin Co's second round of financing -- 990,787,728.36
Due from other companies 214,150,189.84 654,048,308.38
Total 431,690,700.91 2,750,379,230.31
26. Current portion of non-current liabilities
Item 2023.12.31 2022.12.31
Long-term loans due within one year 1,315,853,024.03 1,480,490,424.42
Bonds payable due within one year -- 2,528,468,055.61
Long-term payables due within one year -- 15,781,907.85
Lease liabilities due within one year 21,833,736.47 14,027,634.72
Total 1,337,686,760.50 4,038,768,022.60
(1) Long-term loans due within one year
Item 2023.12.31 2022.12.31
Guaranteed loans 811,562,222.22 613,355,833.34
Credit loans 504,290,801.81 867,134,591.08
Total 1,315,853,024.03 1,480,490,424.42
(2) Bonds payable due within one year
Item 2023.12.31 2022.12.31
20 shouqian 01 -- 2,528,468,055.61
(3) Long-term payables due within one year
147
Beijing Shougang Co. Ltd Annual Report 2023
Item 2023.12.31 2022.12.31
Long-term payables -- 15,781,907.85
27. Other current liabilities
Item 2023.12.31 2022.12.31
Short-term bonds payable 1,003,296,438.41 1,006,213,698.66
Tax to be exported 875,183,618.12 724,801,203.37
Undue backed notes 3,171,985,421.26 6,357,735,008.71
Shougang Jing Notes 1,156,926,762.88 --
Total 6,207,392,240.67 8,088,749,910.74
Short-term bonds payable:
Bond name Nominal value Coupon rate Issue date Maturity of bond Issue amount
SCP1 1,000,000,000.00 2.56% 2023/11/16 155 Days 1,000,000,000.00
SCP2 1,000,000,000.00 2.21% 2023/9/8 105 Days 1,000,000,000.00
SCP3 1,000,000,000.00 1.68% 2022/8/19 248 Days 1,000,000,000.00
SCP4 1,000,000,000.00 2.37% 2023/4/17 186 Days 1,000,000,000.00
Subtotal 4,000,000,000.00 4,000,000,000.00
Short-term Bonds Payable (continued):
Amortization of
Bond Issued during Interest accrued Repaid in the Breached
2023.1.1 premium and 2023.12.31
name current period per nominal value current period or not
discount
SCP1 -- 1,000,000,000.00 3,296,438.41 -- -- 1,003,296,438.41 No
SCP2 -- 1,000,000,000.00 6,340,163.93 -- 1,006,340,163.93 -- No
SCP3 1,006,213,698.66 -- 5,201,095.86 -- 1,011,414,794.52 -- No
SCP4 -- 1,000,000,000.00 12,044,262.30 -- 1,012,044,262.30 -- No
Total 1,006,213,698.66 3,000,000,000.00 26,881,960.50 -- 3,029,799,220.75 1,003,296,438.41
28. Long-term loans
Range of interest Range of interest
Item 2023.12.31 2022.12.31
rate rate
Credit loans 5,293,350,801.81 2.6%-3.7% 2,661,484,591.08 2.85%-3.85%
Guaranteed loans 8,811,562,222.22 4.65% 9,413,355,833.34 4.65%
Subtotal 14,104,913,024.03 12,074,840,424.42
Less: Long-term loans due
1,315,853,024.03 1,480,490,424.42
within one year
Total 12,789,060,000.00 10,594,350,000.00
29. Bonds payable
148
Beijing Shougang Co. Ltd Annual Report 2023
Item 2023.12.31 2022.12.31
20 shouqian 01 -- --
Increase or decrease in bonds payable
Bond name Par value Coupon rate Issue date Term to maturity Amount on offer
20 shouqian 01 2,500,000,000.00 3.98% 2020/9/15 5 years 2,500,000,000.00
Bonds payable (continued):
Current
Accrued interest by Amortisation Current year Breached
Bond name 2023.1.1 year 2023.12.31
par value of discount repayment or not
issuance
20 shouqian 01 2,528,468,055.61 -- 71,031,944.39 -- 2,599,500,000.00 -- No
Less: Long-term loans due
2,528,468,055.61 -- -- -- -- --
within one year
Total -- -- -- -- -- --
30. Lease liabilities
Item 2023.12.31 2022.12.31
Lease liabilities 493,579,496.82 86,467,471.51
Less: lease liabilities due within one year 21,833,736.47 14,027,634.72
Total 471,745,760.35 72,439,836.79
Note: The amount of interest expense of lease liabilities in 2023 is RMB19,884,783.97, which
is included in financial expense - interest costs.
31. Long-term payables
Item 2023.12.31 2022.12.31
Special payables 2,300,000.00 2,300,000.00
Special payables
Item 2023.1.1 Increase Decrease 2023.12.31
Research and development funds 2,300,000.00 -- -- 2,300,000.00
32. Long-term employee benefits payables
Item 2023.12.31 2022.12.31
Termination benefits 19,620,436.48 23,239,569.30
Other long-term benefits 63,319,844.40 65,216,081.72
Subtotal 82,940,280.88 88,455,651.02
Less: Long-term Employee benefits
5,890,000.00 5,890,000.00
payables due within one year
Total 77,050,280.88 82,565,651.02
149
Beijing Shougang Co. Ltd Annual Report 2023
33. Deferred revenue
Item 2023.1.1 Increase Decrease 2023.12.31 Reason
Government grant 472,861,881.90 70,475,200.00 35,662,925.41 507,674,156.49
Value added tax
-- 702,817,741.40 358,107,596.53 344,710,144.87
additional deduction
Total 472,861,881.90 773,292,941.40 393,770,521.94 852,384,301.36
Note: The government grants which recognized as deferred revenue refer to Note Ⅷ. government
grants.
34. Other non-current liabilities
Item 2023.12.31 2022.12.31
Shougang Group advance payment for construction 3,899,674,951.80 4,532,018,467.20
35. Share capital
Changes in current (+/-)
Item 2023.1.1 Shares 2023.12.31
Bonus
Shares issued transferred from Others Subtotal
issue reserves
Total amount
of shares
7,819,869,170.00 -25,257,565.00 -- -- -- -25,257,565.00 7,794,611,605.00
Note: On October 18, 2023, through the resolution of the Company's 2022 annual general meeting
and the first extraordinary general meeting of shareholders in 2023, a total of 25,257,565 shares of
restricted stock in the 2021 restricted stock incentive plan were repurchased and cancelled. Grant
Thornton LLP has conducted an audit on the reduction of share capital and issued a capital
verification report with GTYZ (2023) No. 110C000511.
36. Capital reserve
Item 2023.1.1 Increase Decrease 2023.12.31
Share premium 29,595,169,702.75 -- 55,046,090.91 29,540,123,611.84
Other capital reserve 48,878,848.75 770,078,729.76 -- 818,957,578.51
Total 29,644,048,551.50 770,078,729.76 55,046,090.91 30,359,081,190.35
Note: The change in share capital premium refers to the repurchase and cancellation of restricted
stocks granted in 2021 by the Company; ② Other changes in capital reserves refer to changes in
equity of joint ventures and associates recognized by the company based on shareholding ratios,
amortization expenses for equity incentives, and changes in equity ratios of subsidiaries.
37. Treasury shares
Item 2023.1.1 Increase Decrease 2023.12.31
Restricted stock incentive plan 210,930,850.00 -- 80,303,655.91 130,627,194.09
Note: Due to the failure of the performance evaluation indicators for the 2022 fiscal year to meet
the Company level of performance evaluation conditions for the first period of lifting restrictions as
150
Beijing Shougang Co. Ltd Annual Report 2023
stipulated in the Incentive Plan, changes in some incentive objects due to organizational or personal
reasons that do not meet the incentive conditions, and the implementation of the employee stock
ownership plan by Zhixin Co., the Company repurchased and cancelled a total of 25,257,565 shares
of restricted stocks that have been granted but have not yet been released, and paid RMB
80,303,655.91 for equity incentive repurchase.
38. Other comprehensive income
Other comprehensive income attributable to the parent company in the balance sheet:
During the period
Item 2023.1.1 Less: Transferred from other 2023.12.31
Attributable to the parent comprehensive income in prior
company after tax periods to retained earnings
during the period
I. Other comprehensive
income which cannot be
reclassified into profits or
losses
Changes in fair value of
other equity instrument 158,251,774.94 91,322,264.62 -- 249,574,039.56
investments
II. Other comprehensive
income to be reclassified
into profits or losses
Translation difference of
foreign currency financial -- -65.91 -- -65.91
statements
Total other
comprehensive incomes
158,251,774.94 91,322,198.71 -- 249,573,973.65
Other comprehensive income attributable to the parent company in the income statement:
During the period
Less: Transferred
from other
Item Less: Attributable to
Incurred before comprehensive Attributable to
Less: Income tax minority
income tax for the income in prior parent company
expenses shareholders after
period periods to profit or after tax
tax
loss during the
period
I. Other
comprehensive
income which
cannot be
reclassified into
profits or losses
Changes in fair
value of other equity
instrument
107,437,958.40 -- 16,115,693.78 -- 91,322,264.62
investments
II. Other
comprehensive
income to be
reclassified into
profits or losses
Translation
difference of foreign
currency financial
-65.91 -- -- -- -65.91
statements
Total other
comprehensive 107,437,892.49 -- 16,115,693.78 -- 91,322,198.71
incomes
151
Beijing Shougang Co. Ltd Annual Report 2023
The net-of-tax amount of other comprehensive income for the period is RMB91,322,198.71, among
which, the net-of-tax amount of other comprehensive income attributable to the parent company is
RMB91,322,198.71; and net-of-tax amount of other comprehensive income attributable to minority
shareholders is RMB 0.00.
39. Special reserve
Item 2023.1.1 Increase Decrease 2023.12.31
Safety fund 31,852,310.79 166,839,138.29 165,878,038.94 32,813,410.14
40. Surplus reserve
Item 2023.1.1 Increase Decrease 2023.12.31
Statutory reserve 1,908,883,208.67 35,307,283.98 -- 1,944,190,492.65
Discretionary surplus
-- -- -- --
reserve
Total 1,908,883,208.67 35,307,283.98 -- 1,944,190,492.65
41. Retained earnings
Appropriation/
Item 2023 2022 Distribution
ratio
Retained earnings at previous year before adjustment 8,595,698,699.52 8,130,868,205.38 --
Adjustment of total retained earnings at previous year
-- -- --
(Increase in “+”, decrease in “-”)
Retained earnings at previous year after adjustment 8,595,698,699.52 8,130,868,205.38
Add: Net profit attributable to shareholders of the company 663,754,519.41 1,124,540,659.14 --
Less: Transfer to statutory surplus reserve 35,307,283.98 --
Transfer to discretionary surplus reserve -- --
Common Stock dividends payable -- 625,589,533.60
Dividends payable to other equity holders -- 34,120,631.40
Common stock dividends converted into share capital -- --
Retained earnings at current year 9,224,145,934.95 8,595,698,699.52
Including: Surplus reserve attributable to shareholders of
the company extracted by subsidiaries
42. Revenue and cost of sales
(1) Revenue and cost of sales
2023 2022
Item
Revenue Cost of sales Revenue Cost of sales
Main business 110,360,385,867.79 105,336,679,879.43 114,602,567,434.30 108,013,843,862.04
Other business 3,401,057,765.64 3,114,259,348.92 3,539,616,115.17 3,053,711,458.24
152
Beijing Shougang Co. Ltd Annual Report 2023
Total 113,761,443,633.43 108,450,939,228.35 118,142,183,549.47 111,067,555,320.28
(2) Revenue and cost of sales presented as products
2023 2022
Item
Revenue Cost of sales Revenue Cost of sales
Main business:
Billet 420,010,787.22 419,214,964.92 546,474,748.00 473,163,072.64
Hot-rolled steel 47,572,138,080.78 45,948,593,124.43 48,304,009,189.85 46,623,686,161.87
Cold-rolled steel 60,288,367,715.32 57,068,321,706.00 63,569,306,854.33 59,017,610,809.13
Other steels 2,079,869,284.47 1,900,550,084.08 2,182,776,642.12 1,899,383,818.40
Subtotal 110,360,385,867.79 105,336,679,879.43 114,602,567,434.30 108,013,843,862.04
Other business
Power 1,438,721,205.53 1,548,462,791.82 1,386,026,949.59 1,380,897,100.66
Solid waste 1,254,710,199.53 1,092,896,195.57 1,338,134,781.31 1,199,982,844.66
Others 707,626,360.58 472,900,361.53 815,454,384.27 472,831,512.92
Subtotal 3,401,057,765.64 3,114,259,348.92 3,539,616,115.17 3,053,711,458.24
Total 113,761,443,633.43 108,450,939,228.35 118,142,183,549.47 111,067,555,320.28
(3) Breakdown of revenue information
Item 2023
Revenue from main business 110,360,385,867.79
Including: recognised at a certain point in time 110,360,385,867.79
recognised during a certain period of time --
Revenue from other business 3,401,057,765.64
Total 113,761,443,633.43
As of 31 December 2023, the amount of revenue corresponding to the performance obligations
that the company has signed but not yet fulfilled is RMB 4,585.0989 million. The Company
expects to recognize all the revenue in 2024.
(4) Sales revenue for pilot run
2023 2022
Item
Revenue Cost of sales Revenue Cost of sales
Sales revenue for fixed assets pilot
727,577,085.52 570,215,586.70 902,657,089.87 897,638,764.80
run
43. Taxes and surcharges
Item 2023 2022
Environmental protection tax 29,378,169.09 33,744,422.88
153
Beijing Shougang Co. Ltd Annual Report 2023
Urban maintenance and construction tax 82,829,113.41 101,654,296.06
Education surcharge 60,232,484.87 74,499,878.54
Resources duty 42,514,815.04 41,927,760.60
Property tax 200,940,588.26 197,700,840.52
Land usage tax 222,030,070.11 221,682,543.86
Vehicle and vessel usage tax 339,296.12 336,360.10
Stamp duty 135,239,940.90 151,537,114.35
Other taxes 283,799.72 177,866.02
Total 773,788,277.52 823,261,082.93
Note: The provision and payment standards of taxes and surcharges refer to Note IV. Taxation.
44. Selling and distribution expenses
Item 2023 2022
Staff costs 177,495,001.31 183,609,735.80
Depreciation and amortization 101,427.85 107,397.02
Other regualr expenses 70,382,183.96 54,279,893.40
Total 247,978,613.12 237,997,026.22
45. General and administrative expenses
Item 2023 2022
Staff costs 662,496,839.12 668,044,773.52
Depreciation and amortization 336,502,316.28 336,647,438.61
Other regular expenses 290,613,854.13 266,483,526.93
Total 1,289,613,009.53 1,271,175,739.06
46. Research and development expenses
Item 2023 2022
Staff costs 418,054,111.94 575,278,177.87
Other regular expenses 73,024,683.39 51,645,079.49
Total 491,078,795.33 626,923,257.36
47. Financial expenses
Item 2023 2022
Interest costs 1,459,986,955.71 1,876,045,277.79
Including: Interest expenses on lease liabilities 19,884,783.97 4,408,691.60
Less: interest capitalized -- 12,335,416.66
154
Beijing Shougang Co. Ltd Annual Report 2023
Interest expenses 1,459,986,955.71 1,863,709,861.13
Less:interest income 107,859,174.95 132,829,545.65
Discount on notes acceptance 69,038,764.98 22,128,963.88
Exchange losses and gains -11,596,478.72 -29,489,525.05
Bank charges and others -56,359,813.15 8,064,537.04
Total 1,353,210,253.87 1,731,584,291.35
Note: Capitalized interest amounts have been accounted for construction in progress. The
capitalization rate used to calculate and determine the capitalization amount of borrowing costs
in previous period is 4.05%.
48. Other income
Item 2023 2022
Related to assets 35,422,925.41 39,401,467.49
Related to income 102,064,691.25 33,934,028.23
Value added tax deduction 358,107,596.53 646,083.96
Refund of personal income tax commission 1,570,586.42 2,160,426.28
Total 497,165,799.61 76,142,005.96
The details of government grants refer to Note Ⅷ government grants.
49. Investment gain
Item 2023 2022
Investment gain from long-term equity investments under
-192,776,595.40 -227,515,854.43
the equity method
Gain on disposal of long-term equity investments -1,083,074.06 -583,440.77
Dividend from other equity instruments investments 7,412,132.80 5,614,882.12
Interest gain from entrusted loans 8,990,991.36 11,275,389.73
Others 3,816,230.52 --
Total -173,640,314.78 -211,209,023.35
50. Gains from changes in fair value
Sources of gains from changes in fair value 2023 2022
Other non-current financial assets designated as measured
-4,224,788.99 -765,992.40
at fair value through profit or loss
51. Credit impairment losses (loss in “-”)
Item 2023 2022
Provision for bad debts of notes receivable 2,735,686.54 139,430.10
Provision for bad debts of accounts receivable 11,362,839.02 5,013,380.11
155
Beijing Shougang Co. Ltd Annual Report 2023
Provision for bad debts of financing receivable 253,191.32 104,938.54
Provision for bad debts of other receivables 718,309.36 385,715.13
Provision for bad debts of other current assets 33,127,315.83 --
Total 48,197,342.07 5,643,463.88
52. Impairment losses on assets (loss in “-”)
Item 2023 2022
Provision for invertory impairment -600,099,065.24 -402,994,496.88
53. Gains on disposal of assets
Item 2023 2022
Gains from disposal of fixed assets (loss in “-”) 567,839.38 -611,088.11
54. Non-operating income
Recognised as
Item 2023 2022 non-recurring gains or
losses in 2023
Gains on assets scrapping or damage 908,690.98 5,051,368.61 908,690.98
Compensation payments 1,861,990.05 243,985.86 1,861,990.05
Others 4,204,805.41 6,008,845.31 4,204,805.41
Total 6,975,486.44 11,304,199.78 6,975,486.44
55. Non-operating expenses
Recognised as non-recur
Item 2023 2022 ring gains or losses in
2023
Losses on assets scrapping or damage 23,542,645.85 61,414,433.22 23,542,645.85
Compensation and penalty 1,493,872.04 17,550.00 1,493,872.04
Carbon emission quota trading 4,006,315.70 5,264,317.89 --
Others 415,021.11 407,108.31 415,021.11
Donation -- 978,613.90 --
Total 29,457,854.70 68,082,023.32 25,451,539.00
56. Income tax expenses
(1) Details of income tax expenses
Item 2023 2022
Current tax in accordance with tax laws and related
112,909,545.39 219,005,828.78
regulations
Deffered income tax expenses 33,605,509.90 64,692,649.53
156
Beijing Shougang Co. Ltd Annual Report 2023
Total 146,515,055.29 283,698,478.31
(2) Reconciliation between income tax expenses and profit before income tax is as follows:
Item 2023 2022
Profit before tax 900,319,899.50 1,793,113,877.83
Tax at the applicable tax rate of 15% 135,047,984.93 268,967,081.67
Taxation effect of different tax rates of subsidiaries 6,900,203.08 9,416,049.20
Adjustment of income tax in the prior year 5,401,974.76 -167,423.08
Share of profit or loss of joint ventures and associates
41,547,885.35 37,956,945.34
under the equity method
Income not subject to tax（expressed in“-”） -1,111,819.92 -842,232.32
Non-deductible costs, expenses and losses 3,612,674.67 9,328,763.06
Taxation effect of the change in the applicable tax rate on
-- --
the Opening balance of the deffered tax
Taxation effect of utilizing previous unrecognized tax
losses and deductible temporary differences (expressed in -23,524,321.54 -39,016,139.47
“-”)
Taxation effect of unrecognized tax losses and deductible
9,405,358.55 296,879,494.17
temporary differences
Taxation effect of research and development expenses
-8,264,888.30 -7,022,222.63
(expressed in “-”)
Others -22,499,996.29 -291,801,837.63
Income tax expenses 146,515,055.29 283,698,478.31
57. Notes to cash flow statement
(1) Proceeds from other operating activities
Item 2023 2022
Government grants received 173,870,477.67 144,356,668.51
Security deposit received 1,714,500.00 7,797,264.28
Other non-operating income received 5,610,435.02 6,252,831.17
Other receivables received 366,102.15 907,256.25
Restricted funds received 894,038,447.29 607,900,032.50
Total 1,075,599,962.13 767,214,052.71
(2) Payments for other operating activities
Item 2023 2022
Expenses paid 469,828,037.02 386,282,467.41
Non-operating expenses paid 5,914,076.77 6,667,590.10
Restricted funds paid 6,500,000.00 --
Total 482,242,113.79 392,950,057.51
157
Beijing Shougang Co. Ltd Annual Report 2023
(3) Proceeds from material investing activities
Item 2023 2022
Proceeds from disposal of equity of Zhixin Co. by New-E
1,260,401,500.00 --
Co.
Proceeds from disposal of Ordos Baotou Steel Shourui
-- 38,609,883.16
Material Technology Co., Ltd. by Steel Trading
Total 1,260,401,500.00 38,609,883.16
(4) Proceeds from other investing activities
Item 2023 2022
Interest income 106,533,297.74 132,789,335.69
(5) Payment for material investing activities
Item 2023 2022
Entrusted loan payment to Zhonghong 12,311,109.00 7,700,000.00
Purchase payment for ball burning 650,162,899.68 781,780,592.71
Total 662,474,008.68 789,480,592.71
(6) Payment for other financing activities
Item 2023 2022
Financial expenses-commissions fee 1,203,876.70 1,087,113.74
Paying back the borrowings from Shougang Group 590,000,000.00 102,661,561.32
Lease payments 51,873,444.07 18,776,827.47
Payment for non-public offering fees -- 14,443,431.52
Investment funds payment to minority shareholders 364,349,130.58 --
Payment for equity incentive repurchasement 80,303,655.91 --
Cash payment for New Energy Materials Co. splitting 887,314.66 --
Total 1,088,617,421.92 136,968,934.05
(7) Changes in liabilities arising from financing activities (Unit: RMB 0,000)
Cash movement Non-cash movement
Item Opening balance Closing balance
Accrued
Cash inflow Cash outflow Fair value changes Others
interest
Short-term
2,958,000.61 2,814,572.27 3,188,867.58 82,430.26 -- -- 2,666,135.56
borrowing
Long-term
1,207,484.04 370,183.00 218,477.13 51,301.39 -- -- 1,410,491.30
borrowing
Bonds payable 353,468.18 300,000.00 562,929.93 9,791.39 -- -- 100,329.64
Lease Liabilities 8,646.75 -- 5,187.35 1,988.48 -- 43,910.07 49,357.95
Total 4,527,599.58 3,484,755.27 3,975,461.99 145,511.52 -- 43,910.07 4,226,314.45
Note: Others refer to the additional lease liabilities for the current period.
158
Beijing Shougang Co. Ltd Annual Report 2023
58. Supplements to statement of cash flows
(1) Supplementary information
Supplementary information 2023 2022
1. Reconciliation of net profit to net cash flows from
operating activities:
Net profit 753,804,844.21 1,509,415,399.52
Add: Impairment losses on assets 600,099,065.24 402,994,496.88
Credit impairment losses -48,197,342.07 -5,643,463.88
Depreciation of fixed assets 7,735,539,138.64 7,606,486,882.19
Depreciation of right-of-use assets 33,163,882.30 17,047,777.32
Amortization of intangible assets 184,816,598.20 174,693,821.90
Amortizaiton of long-term deffered expenses 973,269.04 588,715.53
Losses on disposal of fixed assets, intangible assets and
-567,839.38 611,088.11
other long-term assets (Gains as in “-”)
Losses on written-off fixed assets (Gains as in “-”) 22,633,954.87 56,363,064.61
Losses on fair value changes (Gain as in “-”) 4,224,788.99 765,992.40
Financial expenses (Income as in “-”) 1,353,210,253.87 1,731,584,291.35
Investment losses (Income as in “-”) 173,640,314.78 211,209,023.35
Decrease in deferred tax assets
-38,714,829.81 -212,634,532.02
(Increase as in “-”)
Increase in deferred tax liabilities
56,941,878.24 277,327,181.55
(Decrease as in “-”)
Decrease in inventories (Increase as in “-”) -764,110,188.47 -344,414,864.08
Decrease in receivables from
-551,504,080.80 850,893,260.68
operating activities (Increase as in “-”)
Increase in payables from
-4,243,063,771.00 -2,898,834,775.85
operating activities (Decrease as in “-”)
Others 881,416,134.97 665,782,138.24
Net cash flow from operating activities 6,154,306,071.82 10,044,235,497.80
2. Significant non-cash payments for investing and
financing activities:
Conversion of debt into capital -- --
Convertible bonds due within one year -- --
Newly added right-of-use assets in the current period 436,316,890.81 --
3. Net changes in cash and cash equivalents:
Closing balance of cash 8,904,660,678.08 8,329,215,003.68
Less: Opening balance of cash 8,329,215,003.68 8,535,871,373.08
Add: Closing balance of cash equivalents -- --
Less: Opening balance of cash equivalents -- --
Net increase in cash and cash equivalents 575,445,674.40 -206,656,369.40
Note: The amount of endorsement and transfer of acceptance notes received from goods sales of the
159
Beijing Shougang Co. Ltd Annual Report 2023
Company is RMB 7,075,729.08.
(2) Components of cash and cash equivalents
Item 2023.12.31 2022.12.31
1. Cash 8,904,660,678.08 8,329,215,003.68
Including: Cash on hand 33,669.68 23,581.90
Digital currency -- --
Balances in banks without restriction 8,904,626,995.66 8,329,191,409.04
Other monetary funds without restriction 12.74 12.74
2. Cash equivalents
Including: bonds investment due within three months -- --
3. Closing balance of cash and cash equivalents 8,904,660,678.08 8,329,215,003.68
Including: restricted cash and cash equivalents from the
-- --
parent company or its subsidiaries
(3) Monetary funds not belong to cash and cash equivalents
Reasons for monetary funds not
Item 2023.12.31 2022.12.31 belong to cash and cash
equivalents
Other monetary funds 246,369,301.95 1,140,407,749.24 Security deposit
Accruing interest based on actual
Accrued interest 2,175,646.34 849,769.13
interest rate
Total 248,544,948.29 1,141,257,518.37
59. Notes to Statement of Changes in Shareholders' Equity
Note: There is no amount in the "Other" item of the statement of changes in shareholder equity Ⅵ
for the current period.
60. Foreign currency monetary items
(1) Foreign currency monetary items
Closing balance for foreign Closing balance converted to
Item Exchange rate
currency RMB
Cash at bank and on hand
Including: USD 268,023.92 7.0827 1,898,333.02
Accounts payable
Including: USD 2,020.88 7.0827 14,313.29
(2) Overseas operating entities
Subsidiary of the Company, Zhixin Electromagnetic (Hong Kong) Trading Co., Ltd., mainly
operates in Hong Kong with the Hong Kong dollar as the functional currency. The functional
currency has not changed.
61. Lease
160
Beijing Shougang Co. Ltd Annual Report 2023
(1) The Company as lessee
Item 2023
Short-term leases 2,949,195.71
Low-value leases --
Variable lease payments not measured as lease liabilities -
(2) The Company as lessor
Operating leases:
① lease revenue
Item 2023
Lease revenue 38,277,615.46
Including: income related to variable lease payments not included in lease receipts --
② The amount of undiscounted lease receipts that will be received in each of the five consecutive
fiscal years after the balance sheet date and the total amount of undiscounted lease receipts that will
be received in the remaining fiscal years.
Item 2023.12.31 2022.12.31
Within 1 year 35,735,251.77 33,328,200.36
1 – 2 years 6,920,087.96 1,793,773.33
2 – 3 years 4,658,975.20 --
Over 3 years 37,660,049.61 --
Total 84,974,364.53 35,121,973.69
VI. R&D expenses
2023 2022
Item
Expensed amount Capitalized amount Expensed amount Capitalized amount
Employee benefits
418,054,111.94 -- 575,278,177.87 --
payable expenses
Other expenses 73,024,683.39 -- 51,645,079.49 --
Total 491,078,795.33 -- 626,923,257.36 --
VII. Interests in other entities
1. Interests in subsidiaries
(1) Composition of the Company
Unit：RMB
Shareholding ratio (%)
Main Operation Acquisition
Subsidiary Registered Capital Registration place Business nature
place method
Directly Indirectly
161
Beijing Shougang Co. Ltd Annual Report 2023
Shareholding ratio (%)
Main Operation Acquisition
Subsidiary Registered Capital Registration place Business nature
place method
Directly Indirectly
Business
Shougang Jingtang United Production and combination
Iron & Steel Co., Ltd.
3,582,167.63 Tangshan, PRC Tangshan, PRC
sales
70.18 29.82 under common
control
Beijing Shougang Cold Production and Establish or
Rolling Co., Ltd.
260,000.00 Beijing, PRC Beijing, PRC
sales
70.28 -- investment, etc.
Business
Qian'an Shougang
Consulting combination
Metallurgical Technology 190.00 Qian’an, PRC Qian’an, PRC 100.00 -- under
service common
Co., Ltd.
control
Shougang Zhixin Qian'an
Production and Establish or
Electromagnetic Materials 1,129,982.84 Qian’an, PRC Qian’an, PRC 66.23 -- investment, etc.
sales
Co., Ltd.
Business
Beijing Shougang Steel
Production and combination
Trading Investment 113,679.82 Beijing, PRC Beijing, PRC
sales
100.00 -- under common
Management Co., Ltd.
control
(2) Significant non-wholly owned subsidiaries
Unit：RMB
Net profit/ (loss) attributable Dividends declared and Non-controlling interests
Proportion of minority
Subsidiary to non-controlling interests in distributed to non-controlling at the end of reporting
shareholders (%)
reporting period interests in reporting period period
Beijing Shougang Cold
Rolling Co., Ltd.
29.72 7,621,479.70 -- -309,021,464.85
Shougang Zhixin Qian'an
Electromagnetic Materials 33.77 87,355,475.30 155,505,996.34 4,906,442,911.49
Co., Ltd.
(3) Major financial information of significant non-wholly owned subsidiaries
Unit：RMB
2023.12.31
Subsidiary
Non-current
Current assets Non-current assets Total assets Current liabilities Total liabilities
liabilities
Beijing
Shougang Cold 1,523,555,615.93 3,650,902,283.79 5,174,457,899.72 2,216,553,392.64 3,993,850,445.05 6,210,403,837.69
Rolling Co., Ltd.
Shougang Zhixin
Qian'an
Electromagnetic 5,315,471,057.37 15,796,111,190.51 21,111,582,247.88 5,228,317,348.03 1,401,485,982.54 6,629,803,330.57
Materials Co.,
Ltd.
Continued (1):
2022.12.31
Subsidiary
Non-current
Current assets Non-current assets Total assets Current liabilities Total liabilities
liabilities
Beijing Shougang
Cold Rolling Co., 2,317,199,255.15 3,836,449,761.31 6,153,649,016.46 2,646,502,899.97 4,570,607,323.65 7,217,110,223.62
Ltd.
Shougang Zhixin
Qian'an
5,760,507,592.72 15,459,717,661.10 21,220,225,253.82 7,660,663,373.94 1,401,952,326.63 9,062,615,700.57
Electromagnetic
Materials Co., Ltd.
Continued (2):
Subsidiary 2023 2022
162
Beijing Shougang Co. Ltd Annual Report 2023
Total Cash flow from Total Cash flow from
Operating revenue Net profit comprehensive operating Operating revenue Net profit comprehensive operating
income activities income activities
Beijing Shougang
Cold Rolling Co., 10,222,499,759.89 25,644,278.95 25,644,278.95 490,942,970.07 10,781,367,755.25 216,492,299.49 216,492,299.49 92,949,448.40
Ltd.
Shougang Zhixin
Qian'an
Electromagnetic 14,317,006,979.29 308,135,956.50 308,135,856.97 1,097,996,701.35 13,918,944,889.64 1,080,892,444.41 1,080,892,444.41 1,658,031,259.27
Materials Co.,
Ltd.
2. Changes in the scope of consolidation due to other reasons
In April 2023, the Company completed the separation of its subsidiary Beijing Shougang New
Energy Automobile Material Technology Co., Ltd. and completed the clear deregistration
procedures of the separated Beijing Shougang New Energy Materials Technology Co., Ltd. in
December. After the deregistration, the number of subsidiaries within the scope of consolidation for
current period reduced from 6 to 5.
3. Interests in joint ventures and associates
(1) Significant joint ventures and associates
Shareholding
Joint ventures Main operating proportion (%) Accounting
Place of registration Business nature
or associates place method
Direct Indirect
①Jiont ventures
Tangshan Guoxing Industrial Co., Ltd. Tangshan, PRC Tangshan, PRC Manufacturing 50.00 -- Equity method
Tangshan Shougang Jingtang Xishan Coking
Co., Ltd.
Tangshan, PRC Tangshan, PRC Coking 50.00 -- Equity method
②Associates
Tangshan Tangcao Railway Co., Ltd. Tangshan, PRC Tangshan, PRC Transportation 16.19 -- Equity method
Tangshan Caofeidian Dunshi New Building
Construction Material Co., Ltd.
Tangshan, PRC Tangshan, PRC
Material
25.00 -- Equity method
Qian'an Sinochem Coal Chemical Industrial
Qian’an, PRC Qian’an, PRC Coking 49.82 -- Equity method
Co., Ltd.
Beijing Shouxin Jinyuan Management
Consulting Center (Limited Partnership)
Beijing, PRC Beijing, PRC Investment 20.00 -- Equity method
Beijing Dingshengcheng Packaging Materials
Co., Ltd.
Beijing, PRC Beijing, PRC Manufacturing 45.00 -- Equity method
Ningbo Shougang Zhejin Steel Co., Ltd. Ningbo, PRC Ningbo, PRC Manufacturing 40.00 -- Equity method
Guangzhou Jinghai Shipping Co., Ltd. Guangzhou, PRC Guangzhou, PRC Transportation 20.00 -- Equity method
Shougang (Qingdao) Steel Industry Co., Ltd. Qingdao, PRC Qingdao, PRC Manufacturing 35.00 -- Equity method
Tianjin Shougang Steel
Processing&Distribution Co., Ltd.
Tianjin, PRC Tianjin, PRC Manufacturing 35.00 -- Equity method
Hebei Jingji Industry & Trading Co., Ltd. Shijiazhuang, PRC Shijiazhuang, PRC Manufacturing 35.71 -- Equity method
Qian'an Jinyu Shougang Environmental Building
Protection Technology Co., Ltd.
Tianjin, PRC Tianjin, PRC
Material
35.00 -- Equity method
(2) Primary financial information of significant joint ventures
Tangshan Zhonghong Carbon Chemical Tangshan Shougang Jingtang Xishan
Tangshan Guoxing Industrial Co., Ltd.
Co., Ltd. Coking Co., Ltd.
Item
2023.12.31 2022.12.31 2023.12.31 2022.12.31 2023.12.31 2022.12.31
163
Beijing Shougang Co. Ltd Annual Report 2023
Tangshan Zhonghong Carbon Chemical Tangshan Shougang Jingtang Xishan
Tangshan Guoxing Industrial Co., Ltd.
Co., Ltd. Coking Co., Ltd.
Item
2023.12.31 2022.12.31 2023.12.31 2022.12.31 2023.12.31 2022.12.31
Current assets 87,762,250.00 81,326,897.38 -- 4,453,756.17 2,415,667,328.21 2,203,316,115.22
Including： Cash and cash
11,831,560.37 15,459,879.44 -- 4,153,756.17 921,218,575.78 909,643,194.30
equivalents
Non-current assets 67,486,657.73 76,981,144.98 -- 595,492,113.45 1,124,868,967.63 1,384,560,026.25
Total assets 155,248,907.73 158,308,042.36 -- 599,945,869.62 3,540,536,295.84 3,587,876,141.47
Current liabilities 64,953,492.81 75,404,455.29 -- 580,665,263.21 1,340,411,421.87 1,384,913,879.38
Non-current liabilities 4,929,259.45 6,537,093.21 -- -- 14,286,600.00 6,675,000.00
Total liabilities 69,882,752.26 81,941,548.50 -- 580,665,263.21 1,354,698,021.87 1,391,588,879.38
Net assets 85,366,155.47 76,366,493.86 -- 19,280,606.41 2,185,838,273.97 2,196,287,262.09
Including: Non-controlling
-- -- -- -- -- --
interests
Equity attributable to
shareholders of the 85,366,155.47 76,366,493.86 -- 19,280,606.41 2,185,838,273.97 2,196,287,262.09
company
Net assets calculated by
42,683,077.74 38,183,246.93 -- 9,640,303.21 1,092,919,136.99 1,098,143,631.05
shareholding proportion
Adjustment
Including: Goodwill -- -- -- -- -- --
Unrealized profit or loss of
-- -- -- -- -- --
internal transaction
Impairment -- -- -- -- -- --
Others -- -- -- -- -- --
Carrying value of equity
investment in the joint 42,683,077.74 38,183,246.93 -- 9,640,303.21 1,092,919,136.99 1,098,143,631.05
venture
Fair value of equity
investment with quoted -- -- -- -- -- --
market price
Continued:
Tangshan Zhonghong Carbon Chemical Tangshan Shougang Jingtang Xishan
Tangshan Guoxing Industrial Co., Ltd.
Co., Ltd. Coking Co., Ltd.
Item
2023 2022 2023 2022 2023 2022
Operating revenue 152,846,388.61 164,773,046.58 -- -- 11,913,406,274.48 13,921,855,400.28
Financial expenses 67.65 188,156.32 17,095,669.83 23,772,275.17 18,636,499.11 32,965,577.94
Income tax expense 4,299,552.60 3,565,111.77 -- -- 21,449,766.52 -5,515,983.23
Net profit 11,993,957.13 7,790,570.91 -17,114,456.30 -23,791,852.47 28,813,025.73 56,141,503.88
Net profit from
discontinuing -- -- -- -- -- --
operations
Other comprehensive
-- -- -- -- -- --
income
Total comprehensive
11,993,957.13 7,790,570.91 -17,114,456.30 -23,791,852.47 28,813,025.73 56,141,503.88
income
Dividends received
1,500,000.00 2,000,000.00 -- -- 20,000,000.00 46,000,000.00
from joint venture
(3) Primary financial information of significant associates
164
Beijing Shougang Co. Ltd Annual Report 2023
Tangshan Caofeidian Dunshi New Qian'an Sinochem Coal Chemical
Tangshan Tangcao Railway Co., Ltd.
Construction Material Co., Ltd. Industrial Co., Ltd.
Item
2023.12.31 2022.12.31 2023.12.31 2022.12.31 2023.12.31 2022.12.31
Current assets 11,997,404.09 37,615,636.69 57,009,150.19 77,330,625.86 1,684,760,023.03 2,071,780,230.13
Non-current assets 7,954,587,079.21 8,175,281,488.59 210,901,577.81 224,215,514.07 2,454,695,383.56 2,457,397,455.41
Total assets 7,966,584,483.30 8,212,897,125.28 267,910,728.00 301,546,139.93 4,139,455,406.59 4,529,177,685.54
Current liabilities 2,276,603,433.89 1,026,481,331.40 23,294,131.49 31,678,142.16 2,778,212,894.87 2,727,774,901.17
Non-current liabilities 4,194,211,225.00 5,254,694,650.00 15,659,291.41 -- 18,781,936.85 20,417,377.09
Total liabilities 6,470,814,658.89 6,281,175,981.40 38,953,422.90 31,678,142.16 2,796,994,831.72 2,748,192,278.26
Net assets 1,495,769,824.41 1,931,721,143.88 228,957,305.10 269,867,997.77 1,342,460,574.87 1,780,985,407.28
Including:
Non-controlling -- -- -- -- -- --
interests
Equity attributable to
shareholders of the 1,495,769,824.41 1,931,721,143.88 228,957,305.10 269,867,997.77 1,342,460,574.87 1,780,985,407.28
company
Net assets calculated
by shareholding 242,165,134.57 312,745,653.19 57,239,326.28 67,466,999.44 668,873,969.41 887,363,090.11
proportion
Adjustment
Including: Goodwill -- -- -- -- 4,147,420.21 4,147,420.21
Unrealized profit or
loss of internal -- -- -- -- -- --
transaction
Impairment -- -- -- -- -- --
Others -- -- -- -- -- --
Carrying value of
equity investment in 242,165,134.57 312,745,653.19 57,239,326.28 67,466,999.44 673,021,389.62 891,510,510.32
the associates
Fair value of equity
investment with -- -- -- -- -- --
quoted market price
Continued:
Beijing Shouxin Jinyuan Management Beijing Dingshengcheng Packaging Qian'an Jinyu Shougang Environmental
Consulting Center (Limited Partnership) Materials Co., Ltd. Protection Technology Co., Ltd.
Item
2023.12.31 2022.12.31 2023.12.31 2022.12.31 2023.12.31 2022.12.31
Current assets 49,953,014.72 63,963,941.09 71,276,041.71 59,655,006.56 38,020,972.68 32,667,291.24
Non-current assets 748,940,871.51 694,420,798.63 503,489.11 618,495.73 243,292,858.01 214,254,258.49
Total assets 798,893,886.23 758,384,739.72 71,779,530.82 60,273,502.29 281,313,830.69 246,921,549.73
Current liabilities 159,846,777.25 152,354,244.94 24,261,639.55 22,971,249.27 27,238,639.49 56,004,281.62
Non-current liabilities -- -- --- -- 159,041,166.67 88,818,500.00
Total liabilities 159,846,777.25 152,354,244.94 24,261,639.55 22,971,249.27 186,279,806.16 144,822,781.62
Net assets 639,047,108.98 606,030,494.78 47,517,891.27 37,302,253.02 95,034,024.53 102,098,768.11
Including:
Non-controlling -- -- -- -- -- --
interests
Equity attributable to 639,047,108.98 606,030,494.78 47,517,891.27 37,302,253.02 95,034,024.53 102,098,768.11
shareholders of the
165
Beijing Shougang Co. Ltd Annual Report 2023
Beijing Shouxin Jinyuan Management Beijing Dingshengcheng Packaging Qian'an Jinyu Shougang Environmental
Consulting Center (Limited Partnership) Materials Co., Ltd. Protection Technology Co., Ltd.
Item
2023.12.31 2022.12.31 2023.12.31 2022.12.31 2023.12.31 2022.12.31
company
Net assets calculated
by shareholding 129,100,426.06 122,430,402.99 21,383,051.07 16,786,013.87 33,261,908.60 35,734,568.85
proportion
Adjustment
Including: Goodwill -- -- 44,544.87 44,544.87 -- --
Unrealized profit or
loss of internal -- -- -- -- -- --
transaction
Impairment -- -- -- -- -- --
Others -- -- -- -- -- --
Carrying value of
equity investment in 129,100,426.06 122,430,402.99 21,427,595.94 16,830,558.74 33,261,908.60 35,734,568.85
the associates
Fair value of equity
investment with -- -- -- -- -- --
quoted market price
Continued:
Tangshan Caofeidian Dunshi New Qian'an Sinochem Coal Chemical
Tangshan Tangcao Railway Co., Ltd.
Construction Material Co., Ltd. Industrial Co., Ltd.
Item
2023 2022 2023 2022 2023 2022
Operating revenue 95,540,290.94 93,455,166.47 298,428,204.39 440,890,510.08 7,607,961,864.64 8,253,813,834.07
Net profit -436,239,033.71 -431,009,356.99 -20,910,692.67 3,700,430.86 -438,524,832.41 -414,611,940.11
Net profit from
discontinuing -- -- -- -- -- --
operations
Other comprehensive
-- -- -- -- -- --
income
Total comprehensive
-436,239,033.71 -431,009,356.99 -20,910,692.67 3,700,430.86 -438,524,832.41 -414,611,940.11
income
Dividend received
-- -- 5,000,000.00 12,500,000.00 -- --
from associates
Continued:
Beijing Shouxin Jinyuan Management Beijing Dingshengcheng Packaging Qian'an Jinyu Shougang Environmental
Consulting Center (Limited Partnership) Materials Co., Ltd. Protection Technology Co., Ltd.
Item
2023 2022 2023 2022 2023 2022
Operating income 534,343,438.59 167,658,027.20 183,268,726.98 147,636,999.45 83,963,345.96 34,551,131.55
Net profit 416,836,070.09 123,487,685.42 10,215,638.25 6,318,818.62 -7,064,743.58 1,507,371.77
Net profit from
-- -- -- -- -- --
discontinuing operation
Other comprehensive
-- -- -- -- -- --
income
Total comprehensive
416,836,070.09 123,487,685.42 10,215,638.25 6,318,818.62 -7,064,743.58 1,507,371.77
income
Dividend received from
77,539,284.02 15,232,424.74 -- -- -- --
associates
(4) Summary financial information of no significant joint ventures and associates
166
Beijing Shougang Co. Ltd Annual Report 2023
Item 2023.12.31 or Current period 2022.12.31 or Pervious period
Associates
Total carrying value of investment 128,957,100.56 131,600,050.63
Items calculated according to shareholding ratio -- --
Net profit 3,387,350.67 -473,871.48
Other comprehensive income -- --
Total comprehensive income 3,387,350.67 -473,871.48
4. Interests in unconsolidated structured entities
(1) Basic information of unconsolidated structured entities
The unconsolidated structured entities are the Limited Partnership initiated by the Company-
Beijing Shouxin Jinyuan Management Consulting Center (Limited Partnership) (Hereinafter
referred to as Shouxin Jinyuan Fund or the Partnership) and Beijing Shouxin Jin'an Equity
Investment Partnership (Limited Partnership) (Hereinafter referred to as Shouxin Jin'an Fund or the
Partnership). In accordance with the provisions of the limited partnership agreement, the Company
has no control over the Partnership.
①The purpose of establishing Shouxin Jinyuan Fund is combining the relevant policies of Beijing
on the development of sophisticated industry with the market-oriented operation of M&A
investment, actively responding to the strategic goal of Beijing to build a sophisticated industrial
structure, promoting the upgrading and development of Beijing's sophisticated industry,
contributing to the local economic development and industrial structure adjustment of Beijing, and
creating satisfactory return on investment for investors.
The total subscribed capital of all partners to Shouxin Jinyuan Fund is no less than RMB 1 billion.
The partners of the Fund are divided into general partner and limited partner, the contribution
agreement is as follows: Beijing Shouyuan New Energy Investment Management Co., Ltd., the
general partner, contributes RMB 10,000 thousand; and among the limited partners, the Company
agrees to contribute RMB 200,000 thousand, and the other limited partners agrees to contribute
RMB 790,000 thousand in total.
As at 31 December 2023, Shouxin Jinyuan Fund has conducted investment activities and three
external investment projects has been invested with the amount of RMB 829,432.10 thousand. No
financing activity has been conducted by the Fund.
② The purpose of establishing Shouxin Jin'an Fund is to focus on investment in shougang Group
system of leading enterprises, to enlarge and strengthen shougang Group new material industry, to
focus on the advanced electrical steel materials, casting superalloys and precision alloys, as well as
high performance special steel and other metal new materials that Shougang Group has advantages
in.
The total subscribed capital of all partners to Shouxin Jin'an Fund is no less than RMB 2,070.5455
million. The partners of the Fund are divided into general partner and limited partner, the
contribution agreement is as follows: Beijing Shouyuan Xinneng Investment Management Co., Ltd.,
the general partner, contributes RMB 20.7055 million; and among the limited partners, the
Company agrees to contribute RMB 200,000 thousand, and the other limited partners agrees to
contribute RMB 1,849.84 million in total.
As of 31 December 2023, Shouxin Jin'an Fund has completed fund raising and registered on The
Chinese Association of Securities Investment Funds and two external investment projects has been
invested with the amount of RMB 230 million. No financing activity has been conducted by the
167
Beijing Shougang Co. Ltd Annual Report 2023
Fund.
(2) Carrying value and maximum loss exposure of interests related assets and liabilities
As of 31 December 2023, no assets and liabilities related to the interests in Shouxin Jinyuan Fund
recognized are recognized in the financial statements of the Company except for the partner
contribution agreed in the partner agreement. The maximum loss exposure of the Company's
interests in Shouxin Jinyuan Fund is RMB 45.8864 million. The maximum loss exposure of the
Company's interests in Shouxin Jin'an Fund is RMB 22.2164 million.
(3) The support provided to the unconsolidated structured entities
As of 31 December 2023, the Company had no intention to provide financial support or other
support for Shouxin Jinyuan Fund and Shouxin Jin'an Fund.
(4) Additional information disclosure of unconsolidated structured entities
As of 31 December 2023, no additional information related to Shouxin Jinyuan Fund and Shouxin
Jin'an Fund should be disclosed by the Company.
VIII. Government grants
1. Government grants recognized as deferred income
Items Opening balance Increase Decrease Closing balance Reasons
Deferred income -
472,861,881.90 70,475,200.00 35,662,925.41 507,674,156.49
Government grants
168
Beijing Shougang Co. Ltd Annual Report 2023
Government grants recognized as deferred income and subsequently measured via gross method.
Transfer to Item recognized in Related to assets/
Item Type 2023.1.1 Increase Other changes 2023.12.31
profit or loss income statement Related to income
Financial
Discount funds for imported equipments 12,106,230.11 -- 1,229,110.56 -- 10,877,119.55 Other income Related to assets
appropriation
Government grants for engineering informationization project (Qian'an Financial
275,000.28 -- 99,999.96 -- 175,000.32 Other income Related to assets
Iron and Steel, Cold-R Co.) appropriation
Government grants for energy central project from the Ministry of Financial
1,999,999.88 -- 1,000,000.00 -- 999,999.88 Other income Related to assets
Industry and Information Technology of the People’s Republic of China appropriation
Financial
Special government grants from the Finance Bureau of Qian'an 4,139,130.42 -- 243,478.32 -- 3,895,652.10 Other income Related to assets
appropriation
Financial
Government grants for hot-rolled steel strip TMCP project 1,263,157.88 -- 105,263.16 -- 1,157,894.72 Other income Related to assets
appropriation
Government grants for dedusting system upgrading project (Qian'an Financial
24,473,684.32 -- 1,631,578.92 -- 22,842,105.40 Other income Related to assets
Iron and Steel) appropriation
Financial
Government grants for advanced sewage treatment 4,819,629.56 -- 342,222.24 -- 4,477,407.32 Other income Related to assets
appropriation
Special government grants for denitration engineering from the Hebei Financial
490,000.00 -- 245,000.00 -- 245,000.00 Other income Related to assets
Provincial Finance Department appropriation
Government grants for online environmental monitoring project from Financial
2,500,000.00 -- 500,000.00 -- 2,000,000.00 Other income Related to assets
the Finance Bureau of Caofeidian appropriation
The steelmaking technology and facilities demonstration project
Financial
through carbon dioxide-oxygen mixed injection, funded by University 3,719,298.24 -- 210,526.32 -- 3,508,771.92 Other income Related to assets
appropriation
of Science and Technology Beijing
Financial
National funds for the national 863 project 556,400.00 -- 278,200.00 -- 278,200.00 Other income Related to assets
appropriation
Financial
Government grants for Phase II seawater dsalination project 16,842,105.32 -- 1,052,631.56 -- 15,789,473.76 Other income Related to assets
appropriation
Financial
Government grants for cold-rolled intelligent manufacturing project 21,224,552.64 2,030,000.00 3,026,931.98 -- 20,227,620.66 Other income Related to assets
appropriation
Financial
Government grants for the desulfurization of pelletizing flue gas 20,805,473.66 -- 1,486,105.28 -- 19,319,368.38 Other income Related to assets
appropriation
Environmental protection government grants for closing limestone Financial
1,600,000.00 -- 80,000.00 -- 1,520,000.00 Other income Related to assets
yards appropriation
Government grants for energy-saving incentive for No.3 hydrogen Financial
950,305.21 -- 67,878.96 -- 882,426.25 Other income Related to assets
generator appropriation
Government grants for cold rolling operation department aluminized Financial
2,873,684.17 -- 191,578.96 -- 2,682,105.21 Other income Related to assets
silicon high strength steel automotive plate renovation project appropriation
Government grants for cold rolling operation department high strength Financial
11,450,943.40 2,100,000.00 726,884.37 -- 12,824,059.03 Other income Related to assets
steel 18 roll single stand project appropriation
Government grants for the operation-control system of Financial
19,772,121.20 -- 2,471,515.20 -- 17,300,606.00 Other income Related to assets
production-marketing integration appropriation
169
Beijing Shougang Co. Ltd Annual Report 2023
Transfer to Item recognized in Related to assets/
Item Type 2023.1.1 Increase Other changes 2023.12.31
profit or loss income statement Related to income
Government grants for the specialized production line project of Financial
84,210,526.36 -- 5,263,157.88 -- 78,947,368.48 Other income Related to assets
Zinc-plated high-strengthen auto sheet appropriation
Government grants for reforming of sinter desulfurization and Financial
24,210,526.34 -- 1,578,947.36 -- 22,631,578.98 Other income Related to assets
denitrification appropriation
Financial
Government grants for thin slab casting and rolling engineering 5,179,642.86 187,500.00 285,714.28 -- 5,081,428.58 Other income Related to assets
appropriation
Government grants for reform project of reducing oxynitride Financial
5,830,263.31 -- 331,578.84 -- 5,498,684.47 Other income Related to assets
concentration in emissed flue gas from annealing furnace appropriation
Financial
Government grants for industrial mechanism model base 4,800,000.00 -- 306,382.98 -- 4,493,617.02 Other income Related to assets
appropriation
Financial
Government grants for 10,000 tons/d desalination project 7,963,157.91 -- 468,421.04 -- 7,494,736.87 Other income Related to assets
appropriation
Financial
Government grants for sintering waste heat power generation project 19,336,283.19 -- 1,074,237.92 -- 18,262,045.27 Other income Related to assets
appropriation
Government grants for comprehensive optimization and upgrading
Financial
project of hot blast furnace system in Phase I of ironmaking Operation 23,683,382.96 -- 1,315,743.48 -- 22,367,639.48 Other income Related to assets
appropriation
Department
Government grants for energy conservation and emission reduction Financial
13,429,293.94 1,500,000.00 798,604.47 -- 14,130,689.47 Other income Related to assets
optimization and improvement projects appropriation
Financial
Government grants for Zinc containing solid waste disposal project 4,878,640.78 -- 291,262.12 -- 4,587,378.66 Other income Related to assets
appropriation
Financial
Government grants for high-tech industry development projects 7,000,000.00 -- -- -- 7,000,000.00 Other income Related to assets
appropriation
Financial
Government grants for new energy automotive electrical steel project 78,890,971.68 7,000,000.00 4,451,697.84 -- 81,439,273.84 Other income Related to assets
appropriation
Financial
Government grants for high performance oriented silicon steel project 19,640,000.00 -- 258,421.05 -- 19,381,578.95 Other income Related to assets
appropriation
Government grants for hot rolling heating furnace flue gas purification Financial
-- 30,000,000.00 377,497.81 -- 29,622,502.19 Other income Related to assets
project appropriation
Government grants for technical transformation of deep flue gas Financial
-- 23,945,000.00 376,113.64 -- 23,568,886.36 Other income Related to assets
treatment by adding hot blast furnaces to blast furnaces appropriation
Financial
Other government grants related to assets 21,907,476.28 3,312,700.00 3,256,238.91 -- 21,963,937.37 Other income Related to assets
appropriation
Financial
Other government grants related to income 40,000.00 400,000.00 240,000.00 -- 200,000.00 Other income Related to income
appropriation
Total 472,861,881.90 70,475,200.00 35,662,925.41 -- 507,674,156.49
2. Government grants directly recorded as profit or loss for the current period and measured via gross method.
170
Beijing Shougang Co. Ltd Annual Report 2023
Item recognized Related to assets/
Amount recognised in profit or loss in Amount recognised in profit or loss in
Item Type in income Related to
prior period the period
statement income
Government grants for steady post Financial appropriation 677,779.73 7,773,848.31 Other income Related to income
Government grants for promoting the
development of enterprises operate in the Financial appropriation 3,900,000.00 -- Other income Related to income
region
Technology innovation support funds Financial appropriation 70,883,400.00 -- Other income Related to income
Other government grants related to income Financial appropriation 26,363,511.52 25,727,347.92 Other income Related to income
Total 101,824,691.25 33,501,196.23
171
Beijing Shougang Co. Ltd Annual Report 2023
IX. Financial instruments and risk management
The major financial instruments of the Company include cash and cash equivalents, notes
receivable, accounts receivable, financing receivables, other receivables, current portion of
non-current assets, other current assets, other equity instrument investments, other non-current
financial assets, long-term receivables, notes payable, accounts payable, other payables, short-term
borrowings, financial liabilities held for trading, current portion of non-current liabilities, long-term
borrowings and bond payables, lease liabilities and long-term payables. The details of financial
instruments are disclosed in the respective notes. Risks relate to these financial instruments and risk
management policies used by the Company to minimize the risks are disclosed as below.
Management of the Company manages and monitors the risk exposures to ensure the risks are
controlled in the limited range.
1. Objectives and policies of risk management
The objective of the Company in risk management is to obtain an appropriate equilibrium between
risk and return, and also focuses on minimizing potential adverse effects on the financial
performance of the Company bring by the unpredictability of financial risk. Based on the objectives
of risk management, certain policies are established to recognize and analyze the risk. Also, in order
to monitor the risk position of the Company, internal control procedures are designed according to
acceptable level of risk. Both the policies and internal control procedures are reviewed and revised
regularly to adapt the changes of the market and business activities of the Company.
The primary risks caused by the financial instruments of the Company are credit risk and liquidity
risk.
(1) Credit risk
Credit risk refers to the risk that the counterparty to a financial instrument would fail to discharge
its obligation under the terms of the financial instrument and cause a financial loss to the Company.
The Company manages the credit risk on portfolio basis. Credit risks are mainly caused by cash and
cash equivalents, notes receivable, accounts receivable, other receivables.
The Company mainly deposits in financial institutions with good reputation and high credit rating
therefore no significant credit risk associated with cash and cash equivalents is expected.
In addition, policies related to limit the credit risk exposure on notes receivable, accounts receivable
and other receivables are established by the Company. The Company evaluates credit quality and
sets credit limits on customers by taking into account the financial position, credit records and other
factors such as current market conditions. The credit history of the customers is regularly monitored
by the Company. In respect of customers with a poor credit history, the Company will use written
payment reminders, or shorten or cancel credit periods, to ensure the overall credit risk of the
Company is limited to a controllable extent.
The highest credit risk exposure to the Company is limited to the carrying value of each financial
instrument illustrated in the financial statements. The Company has not provided any guarantee that
might cause credit risk to the Company.
Among the accounts receivable of the Company, the accounts receivable of the top five customers
accounted for 51.55% (2022: 52.28%); among the other receivables of the Company, the other
receivables of the top five customers accounted for 42.85% (2022: 63.31%).
172
Beijing Shougang Co. Ltd Annual Report 2023
(2) Liquidity risk
Liquidity risk refers to the risks that the Company will not be able to meet its obligations associated
with its financial liabilities that are settled by delivering cash or other financial assets.
The Company maintains and monitors sufficient level of cash and cash equivalents as considered by
the management while managing liquidity risk in order to meet operational needs of the Company
and reduce the effect of floating cash flow. The usage of bank loan is monitored by the management
of the Company and the loan covenants are ensured to be complied. Meanwhile, primary financial
institution commits to provide sufficient reserve funds to satisfy the short term and long term fund
requirement of the Company.
2. Capital management
The capital management policies are made to keep the continuous operation of the Company, to
enhance the return to shareholders, to benefit other related parties and to maintain the best capital
structure to minimize the cost of capital.
To the maintenance or adjustment of the capital structure, the Company might adjust the amount of
dividends paid to shareholders, return capital to shareholders, issue new shares and other equity
instruments, or make an asset disposal to reduce debt liabilities.
The Company monitors the capital structure on the basis of leverage ratio (total liabilities divided
total assets). As at 31 December 2023, the leverage ratio of the Company is 60.43% (31 December
2022: 65.03%).
X. Fair value
Fair value hierarchies are categorized into three levels as the lowest level input that is significant to
the entire fair value measurement.
Level 1: inputs are quoted prices (unadjusted) in active markets for identical assets and liabilities.
Level 2: inputs are inputs other than quoted prices included within Level 1 that are observable for
the asset or liability, either directly or indirectly.
Level 3: inputs are unobservable inputs for the asset or liability.
(1) Fair value of assets and liabilities measured at fair value
As at 31 December 2023, assets and liabilities measured at fair value are shown as follows:
Level 1 fair Level 2 fair Level 3 fair
Item value value value Total
measurement measurement measurement
Recurring fair value measurement
Financing receivable -- -- 2,223,431,426.46 2,223,431,426.46
Other equity instrument investment 310,601,456.00 -- 29,602,636.21 340,204,092.21
Other non-current financial assets -- -- 75,009,218.61 75,009,218.61
Total assets measured at fair value
310,601,456.00 -- 2,328,043,281.28 2,638,644,737.28
on a recurring basis
173
Beijing Shougang Co. Ltd Annual Report 2023
(2) Fair values of items not measured at fair value
Financial assets and financial liabilities measured at amortized cost include: cash and cash
equivalents, notes receivable, accounts receivable, other receivables, short-term borrowings, notes
payable, accounts payable, other payables, long-term borrowings due within one year, long-term
borrowings and bonds payable, etc.
No additional details of financial assets and financial liabilities should be disclosed since the
difference between the fair value and carrying value of financial assets and financial liabilities of
the Company is approximately equal.
XI. Related parties and related party transactions
1. Information about the parent company of the Company
Parent Registration Registered capital Shareholding Percentage of voting
Business nature
company place (RMB 0,000) percentage (%) rights (%)
Shougang Company with limited
Group Co., Beijing liability(wholly 2,875,502.50 56.72 56.72
Ltd. state-owned)
The ultimate controlling party of the Company is State-owned Assets Supervision and
Administration Commission of People’s Government of Beijing Municipality.
During the reporting period, the change of the registered capital of the parent company is as follows
(Unit: RMB 0,000):
Opening balance Increase Decrease Closing balance
2,875,502.50 -- -- 2,875,502.50
2. Information about the subsidiaries of the Company
For information about the subsidiaries of the Company, refer to Note VII, 1.
3. Information about joint ventures and associates of the Company
For information about joint ventures and associates of the Company, refer to Note VII, 3.
Joint ventures and associates that have related transactions with the Company in current period or
the previous period are as follows:
Name of joint venture or associate Relationship with the Company
Tangshan Shougang Jingtang Xishan Coking Co., Ltd. Joint ventures of the Company
Tangshan Guoxing Industrial Co., Ltd. Joint ventures of the Company
Tangshan Tangcao Railway Co., Ltd. Associates of the Company
Qian'an Sinochem Coal Chemical Industrial Co., Ltd. Associates of the Company
Beijing Dingshengcheng Packaging Materials Co., Ltd. Associates of the Company
Guangzhou Jinghai Shipping Co., Ltd. Associates of the Company
Tianjin Shougang Steel Processing&Distribution Co., Ltd. Associates of the Company
174
Beijing Shougang Co. Ltd Annual Report 2023
Name of joint venture or associate Relationship with the Company
Ningbo Shougang Zhejin Steel Co., Ltd. Associates of the Company
Tangshan Caofeidian Dunshi New Construction Material Co., Ltd. Associates of the Company
Hebei Jingji Industry & Trading Co., Ltd. Associates of the Company
Beijing Shouxin Jinyuan Management Consulting Center (Limited Partnership) Associates of the Company
Shougang (Qingdao) Steel Industry Co., Ltd. Associates of the Company
Qian'an Jinyu Shougang Environmental Protection Technology Co., Ltd. Associates of the Company
4. Information about other related parties
Related party Relationship with the Company
Shougang Group Finance Co., Ltd. Under the control of the same parent company
Shougang Mining Corporation Under the control of the same parent company
China Shougang International Trade&Engineering Corporation Under the control of the same parent company
Beijing Shougang Refractory& Metallurgical Burden Co., Ltd. Under the control of the same parent company
Beijing Shougang Construction Group Co., Ltd. Under the control of the same parent company
Beijing Shougang Gas Co., Ltd. Under the control of the same parent company
Beijing Shougang Automation Information Technology Co., Ltd. Under the control of the same parent company
Beijing Shougang Machinery&Electric Co., Ltd. Under the control of the same parent company
Qinhuangdao Shougang Machinery Co., Ltd. Under the control of the same parent company
Qian'an Shouxin Automation Information Technology Co., Ltd. Under the control of the same parent company
Qian'an First Real Packaging Service Co., Ltd. Under the control of the same parent company
Qian'an Shougang Equipment Structure Co., Ltd. Under the control of the same parent company
Beijing Soly Technology Co., Ltd. Under the control of the same parent company
Beijing Shouye Instruments&Meters Co., Ltd. Under the control of the same parent company
Beijing Shoujian Equipment Maintenance Co., Ltd. Under the control of the same parent company
Beijing Shoujian Hengxin Labor Service Co., Ltd. Under the control of the same parent company
Beijing Shoujian Hengji Construction Engineering Co., Ltd. Under the control of the same parent company
Beijing Shougang Landscaping Co., Ltd. Under the control of the same parent company
Beijing Shougang International Engineering&Technology Co., Ltd. Under the control of the same parent company
Beijing Jinanyuan Automobile Transportation Co., Ltd. Under the control of the same parent company
Beijing Huaxia Technology Co., Ltd. Under the control of the same parent company
Beijing Shougang Catering Co., Ltd. Under the control of the same parent company
Beijing Shoujia Steel Construction Co., Ltd. Under the control of the same parent company
Beijing Shougang Ferroalloy Co., Ltd. Under the control of the same parent company
Lujiashan Limestone Mining of Shougang Beijing Co., Ltd. Under the control of the same parent company
175
Beijing Shougang Co. Ltd Annual Report 2023
Related party Relationship with the Company
Qinhuangdao Shounai New Materials Co., Ltd Under the control of the same parent company
Yantai Shougang Mining 3D Co., Ltd. Under the control of the same parent company
Tianjin Shougang Electric Equipment Co., Ltd. Under the control of the same parent company
Beijing Chengxin Engineering Supervision Co., Ltd. Under the control of the same parent company
Beijing Shoucheng Packaging Service Co., Ltd. Under the control of the same parent company
Beijing Shougang Materials Trading Co., Ltd. Under the control of the same parent company
Beijing Shougang Futong Elevator Co., Ltd. Under the control of the same parent company
Tangshan Caofeidian Industrial District Shouhanxin Industrial Co., Ltd. Under the control of the same parent company
Tonghua Iron and Steel Co., Ltd. Under the control of the same parent company
Beijing Shougang Huaxia Engineering&Technology Co., Ltd. Under the control of the same parent company
Shougang Environmental Industry Co., Ltd. Under the control of the same parent company
Beijing Teyu Plate Co., Ltd. Under the control of the same parent company
Beijing Shougang Mining Construction Co., Ltd. Under the control of the same parent company
Qinhuangdao Shouqin Metal Materials Co., Ltd. Under the control of the same parent company
Beijing Shougang Industrial Group Co., Ltd. Under the control of the same parent company
Beijing Shougang Cultural Development Co., Ltd. Under the control of the same parent company
Qinhuangdao Shouqin Steel Machining&Delivery Co., Ltd. Under the control of the same parent company
Shougang Casey Steel Co., Ltd. Under the control of the same parent company
Tangshan Caofeidian First Real Industrial Co., Ltd. Under the control of the same parent company
Qiangang Hotel. Under the control of the same parent company
Beijing Shougang Special Steel Co., Ltd. Under the control of the same parent company
Beijing Shougang Yunxiang Industrial Technology Co., Ltd. Under the control of the same parent company
Bohai International Conference Center Co., Ltd. Under the control of the same parent company
Qian'an Shougang Xingkuang Industrial Co., Ltd. Under the control of the same parent company
Shougang Guiyang Special Steel Co., Ltd. Under the control of the same parent company
Beijing Shougang Park Comprehensive Service Co., Ltd. Under the control of the same parent company
Shougang Changzhi Steel&Iron Co., Ltd. Under the control of the same parent company
Beijing Beiye Functional Materials Co., Ltd. Under the control of the same parent company
Beijing Shougang Metal Co., Ltd. Under the control of the same parent company
Tangshan Caofeidian Industrial Zone Jingtang Industrial Co., Ltd. Under the control of the same parent company
Guizhou Bohong Industrial Co., Ltd. Under the control of the same parent company
Dachang Shougang Machinery&Electric Co., Ltd. Under the control of the same parent company
Beijing Shougang Lanzatech Co., Ltd. Under the control of the same parent company
South China International Leasing Co., Ltd Under the control of the same parent company
176
Beijing Shougang Co. Ltd Annual Report 2023
Related party Relationship with the Company
Jingxi Commercial Factoring Co., Ltd. Under the control of the same parent company
Qinhuangdao Shougang Plate Mill Co., Ltd. Under the control of the same parent company
Bejing Shougang International Travel Co., Ltd. Under the control of the same parent company
Hebei Shougang Jingtang Machinery Co., Ltd. Under the control of the same parent company
Qinhuangdao Shougang Racing Valley Co., Ltd Under the control of the same parent company
Beijing Shougang Property Management Co., Ltd. Under the control of the same parent company
Beijing Shouao Real Estate Co., Ltd Under the control of the same parent company
Beijing Shouronghui Technology Development Co., Ltd. Under the control of the same parent company
Shougang Shuicheng Steel (Group) Co., Ltd Under the control of the same parent company
Shougang Shuicheng Steel (Group) Saide Construction Co., Ltd. Under the control of the same parent company
Beijing Shougang Environmental Engineering Technology Co., Ltd. Under the control of the same parent company
Beijing Shougang Gas Tangshan Co., Ltd. Under the control of the same parent company
Guizhou Shuigang Logistics Co., Ltd. Under the control of the same parent company
Beijing Shouke Xingye Engineering Technology Co., Ltd. Under the control of the same parent company
Beijing Shougang Construction Investment Co., Ltd. Under the control of the same parent company
Shougang Commercial Factoring Co., Ltd. Under the control of the same parent company
Guizhou Liupanshui Shenghongda Mechanical Equipment Manufacturing Co.,
Under the control of the same parent company
Ltd
Guiyang Steel Mills I/E Corp. Under the control of the same parent company
Qinhuangdao Shoufang Property Service Co., Ltd. Under the control of the same parent company
Beijing Shouyi Mining Hospital Co., Ltd. Under the control of the same parent company
Peking University Shougang Hospital Under the control of the same parent company
Shougang Yili Steel Co., Ltd. Under the control of the same parent company
Tangshan Shougang Malanzhuang Iron Ore Co., Ltd. Under the control of the same parent company
Beijing Shougang Gitane New Materials Co., Ltd. Under the control of the same parent company
Beijing Shougang Chengyun Holdings Co., Ltd Under the control of the same parent company
Beijing Shoufang Commercial Management Co., Ltd Under the control of the same parent company
Beijing Aidi Geological Engineering Technology Co., Ltd Under the control of the same parent company
Geological Research Institute of Shougang Geological Exploration Institute Under the control of the same parent company
Joint ventures or associates of the Company’s
Beijing Shougang Shape Metal Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Beijing Jingxi Supply Chain Management Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Beijing Thermal Zhongda Heat Exchange Equipment Co., Ltd.
parent company
Joint ventures or associates of the Company’s
PetroChina Shougang (Beijing) Petroleumsales Co., Ltd.
parent company
177
Beijing Shougang Co. Ltd Annual Report 2023
Related party Relationship with the Company
Joint ventures or associates of the Company’s
Beijing Shoushe Metallurgical Technology Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Beijing Shouyu Industry and Trade Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Beijing Xingyeda Machinery&Electric Equipment Manufacture Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Chaoyang Shougang Beifang Machinery Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Tangshan Caofeidian Ganglian Logistics Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Tangshan Caofeidian Industry Port Co., Ltd.
parent company
Joint ventures or associates of the Company’s
YASKAWA Shougang Robert Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Cmi Engineering (Beijing) Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Qian'an Shoujia Construction Material Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Shoujia Huanke (Qian'an) Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Sanhe Shoujia Construction Material Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Hua Xia Bank Co.,Ltd.
parent company
Beijing Shougang Resources Comprehensive Utilization Technology Joint ventures or associates of the Company’s
Development Co., Ltd. parent company
Joint ventures or associates of the Company’s
Jingxi Shoutang Supply Chain Management Co., Ltd
parent company
Joint ventures or associates of the Company’s
Beijing Shoubang New Material Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Jingtang Port Shougang Terminal Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Beijing Shoutegang Yuandong Magnesium Alloy Products Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Suzhou Tonggang Shunye Steel Materials Processing Distribution Co., Ltd.
parent company
Shougang Shuicheng Iron and Steel (Group) Xingyuan Development Joint ventures or associates of the Company’s
Investment Co., Ltd. parent company
Joint ventures or associates of the Company’s
Chengde Xintong Shoucheng Mining Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Gansu Province, Wenxian Million Litie Alloy Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Tangshan Zhonghong Carbon Chemical Co., Ltd.
parent company
Joint ventures or associates of the Company’s
Beijing Shoutaizhongxin Science & Technology Co., Ltd
parent company
Directors, Supervisors, CFO and Board Secretary Key management personnel
5. Information about related party transactions
(1) Details of related purchase and sales
The following transactions with related parties are conducted at market prices or prices agreed upon
in relevant agreements.
178
Beijing Shougang Co. Ltd Annual Report 2023
①Purchase of goods and receiving of services from related parties
Nature of
Related party 2023 2022
transaction
Shougang Group Co., Ltd. Raw material 21,943,134,524.17 30,738,244,970.15
Shougang Group Co., Ltd. Fuel material 33,925,140.63 1,755,484,533.11
Shougang Group Co., Ltd. Spare parts -- 288,719.70
Shougang Group Co., Ltd. Production service 4,971,874.94 24,483,467.94
Shougang Group Co., Ltd. Fund usage charges 63,104,733.91 71,217,912.21
Shougang Group Finance Co., Ltd. Fund usage charges 363,628,875.86 308,397,762.40
Shougang Mining Corporation Raw material 3,890,862,501.60 3,801,893,028.27
Shougang Mining Corporation Power energy 66,992,366.05 --
Shougang Mining Corporation Spare parts 62,655,062.81 5,484,172.00
Shougang Mining Corporation Production service 281,362,511.82 113,846,405.24
Engineering
Shougang Mining Corporation 1,427,460.00 1,904,158.00
equipment
Shougang Mining Corporation Fund usage charges 910,228.06 2,210,553.86
China Shougang International
Export cost 102,473,113.40 82,530,156.00
Trade&Engineering Corporation
China Shougang International
Raw material 6,657,720.00 2,531,173,902.66
Trade&Engineering Corporation
China Shougang International
Fuel material -- 96,591,728.29
Trade&Engineering Corporation
China Shougang International
Production service 96,393.44 --
Trade&Engineering Corporation
Qian'an Sinochem Coal Chemical
Fuel material 6,501,547,316.63 7,005,052,052.73
Industrial Co., Ltd.
Qian'an Sinochem Coal Chemical
Power energy 458,568,346.04 393,033,410.87
Industrial Co., Ltd.
Beijing Shougang Refractory&
Production service -- 1,458,000.00
Metallurgical Burden Co., Ltd.
Beijing Shougang Refractory&
Engineering service -- 6,000,851.01
Metallurgical Burden Co., Ltd.
Beijing Shougang Construction Group
Production service 548,842,653.85 473,493,304.04
Co., Ltd.
Beijing Shougang Construction Group
Spare parts 35,407,572.28 26,646,250.93
Co., Ltd.
Beijing Shougang Construction Group Engineering
5,292,280.97 --
Co., Ltd. equipment
Beijing Shougang Construction Group
Engineering service 802,524,280.03 704,479,068.44
Co., Ltd.
Beijing Shougang Gas Co., Ltd. Spare parts 3,630,225.01 3,642,954.04
Beijing Shougang Gas Co., Ltd. Production service 65,472,431.39 51,120,800.84
Beijing Shougang Gas Co., Ltd. Power energy 98,773,465.58 94,449,984.15
Beijing Shougang Gas Co., Ltd. Auxiliary material 4,766,510.38 4,742,161.45
Beijing Shougang Automation
Production service 302,133,356.71 314,726,062.22
Information Technology Co., Ltd.
179
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Beijing Shougang Automation
Spare parts 13,606,491.82 6,119,863.00
Information Technology Co., Ltd.
Beijing Shougang Automation
Engineering service 217,757,953.54 164,940,165.69
Information Technology Co., Ltd.
Beijing Shougang Automation Engineering
77,516,317.08 56,830,246.32
Information Technology Co., Ltd. equipment
Beijing Shougang Machinery&Electric
Spare parts 105,629,947.66 108,341,720.51
Co., Ltd.
Beijing Shougang Machinery&Electric
Production service 269,364,838.83 269,594,626.52
Co., Ltd.
Beijing Shougang Machinery&Electric Engineering
26,087,727.28 33,623,091.14
Co., Ltd. equipment
Beijing Shougang Machinery&Electric
Engineering service -- 2,106,619.54
Co., Ltd.
Beijing Shougang Machinery&Electric
Fuel material 36,602,521.60 22,308,500.28
Co., Ltd.
Qinhuangdao Shougang Machinery Co.,
Spare parts 46,579,351.41 49,708,124.60
Ltd.
Qinhuangdao Shougang Machinery Co.,
Production service 134,396,914.04 164,741,681.95
Ltd.
Qinhuangdao Shougang Machinery Co.,
Auxiliary material 3,459,776.00 534,000.00
Ltd.
Qinhuangdao Shougang Machinery Co., Engineering
6,418,986.00 2,849,600.00
Ltd. equipment
Qian'an Shouxin Automation
Production service 126,551,235.38 123,198,193.34
Information Technology Co., Ltd.
Qian'an First Real Packaging Service
Production service 318,627,092.06 330,518,074.43
Co., Ltd.
Qian'an First Real Packaging Service
Raw material 3,473,060.09 --
Co., Ltd.
Qian'an Shougang Equipment Structure
Spare parts 15,910,347.80 16,770,235.00
Co., Ltd.
Qian'an Shougang Equipment Structure
Production service 77,276,252.02 74,615,037.69
Co., Ltd.
Qian'an Shougang Equipment Structure Engineering
4,509,802.74 6,099,531.07
Co., Ltd. equipment
Qian'an Shougang Equipment Structure
Engineering service 1,228,547.58 688,292.46
Co., Ltd.
Qian'an Shougang Equipment Structure
Raw material 191,600,192.02 216,797,429.95
Co., Ltd.
Engineering
Beijing Soly Technology Co., Ltd. -- 612,341.00
equipment
Beijing Shouye Instruments&Meters
Spare parts 34,462,950.17 30,692,578.79
Co., Ltd.
Beijing Shouye Instruments&Meters Engineering
6,651,902.00 4,608,458.59
Co., Ltd. equipment
Beijing Shoujian Equipment
Production service 62,908,007.32 45,870,911.70
Maintenance Co., Ltd.
Beijing Shoujian Equipment
Auxiliary material 5,037,420.00 5,154,000.00
Maintenance Co., Ltd.
Beijing Shoujian Equipment
Engineering service -- 5,962,127.57
Maintenance Co., Ltd.
Beijing Shoujian Equipment Engineering
35,208,132.15 9,790,200.00
Maintenance Co., Ltd. equipment
180
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Beijing Shoujian Hengxin Labor Service
Production service 1,688,340.00 1,785,000.00
Co., Ltd.
Beijing Shoujian Hengji Construction
Spare parts 861,565.70 573,207.00
Engineering Co., Ltd.
Beijing Shougang Landscaping Co., Ltd. Life service 23,862,457.96 25,701,356.25
Beijing Shougang International
Spare parts 16,500,348.33 13,777,316.00
Engineering&Technology Co., Ltd.
Beijing Shougang International Engineering
337,374,815.61 197,970,778.68
Engineering&Technology Co., Ltd. equipment
Beijing Shougang International
Engineering service 424,371,608.45 475,003,098.49
Engineering&Technology Co., Ltd.
Beijing Shougang International
Production service 5,998,467.72 664,296.23
Engineering&Technology Co., Ltd.
Beijing Jinanyuan Automobile
Production service 73,364,927.54 67,493,491.20
Transportation Co., Ltd.
Beijing Huaxia Technology Co., Ltd. Spare parts 6,797,312.96 3,781,380.33
Engineering
Beijing Huaxia Technology Co., Ltd. 7,514,099.00 --
equipment
Beijing Huaxia Technology Co., Ltd. Production service 1,085,300.00 86,000.00
Beijing Shougang Catering Co., Ltd. Life service 13,270,186.01 14,014,372.50
Beijing Shoujia Steel Construction Co.,
Production service 29,492,635.04 44,258,026.72
Ltd.
Beijing Shougang Ferroalloy Co., Ltd. Raw material 448,730,252.54 436,896,664.79
Lujiashan Limestone Mining of
Raw material 368,906,926.36 350,495,042.52
Shougang Beijing Co., Ltd.
Lujiashan Limestone Mining of
Production service 92,165,010.94 53,344,775.21
Shougang Beijing Co., Ltd.
Lujiashan Limestone Mining of
Auxiliary material 9,649,790.64 8,312,204.20
Shougang Beijing Co., Ltd.
Qinhuangdao Shounai New Materials
Auxiliary material 119,255,741.87 128,141,883.61
Co., Ltd
Yantai Shougang Mining 3D Co., Ltd. Spare parts -- 577,091.09
Tianjin Shougang Electric Equipment Engineering
15,148,231.00 19,847,769.10
Co., Ltd. equipment
Tianjin Shougang Electric Equipment
Spare parts 12,392,235.00 4,465,189.00
Co., Ltd.
Tianjin Shougang Electric Equipment
Production service 750,000.00 --
Co., Ltd.
Beijing Chengxin Engineering
Engineering service 6,919,560.20 7,529,528.15
Supervision Co., Ltd.
Beijing Chengxin Engineering
Production service 512,000.00 3,717,879.25
Supervision Co., Ltd.
Beijing Shoucheng Packaging Service
Production service 103,974,097.61 107,663,074.01
Co., Ltd.
Beijing Shougang Materials Trading
Fuel material 1,027,466,982.41 269,025,918.47
Co., Ltd.
Beijing Shougang Materials Trading
Raw material 11,693,600,440.83 996,216,356.30
Co., Ltd.
Tangshan Shougang Jingtang Xishan
Power energy 1,511,756,089.09 1,063,798,684.12
Coking Co., Ltd.
181
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Tangshan Shougang Jingtang Xishan
Fuel material 14,807,402,881.55 17,586,534,301.71
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Raw material 8,375,359.37 3,610,282.21
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Production service 121,400,910.06 152,523,150.26
Coking Co., Ltd.
Beijing Shougang Futong Elevator Co.,
Spare parts 161,610.00 177,460.00
Ltd.
Beijing Shougang Futong Elevator Co.,
Production service 795,660.00 884,800.00
Ltd.
Tangshan Guoxing Industrial Co., Ltd. Production service 139,969,704.64 145,637,666.86
Tangshan Guoxing Industrial Co., Ltd. Engineering service 3,882,874.50 2,236,643.61
Tangshan Caofeidian Industrial District
Production service 365,061,060.71 386,060,741.11
Shouhanxin Industrial Co., Ltd.
Tonghua Iron and Steel Co., Ltd. Steels -- 10,109,524.29
Tonghua Iron and Steel Co., Ltd. Raw material 3,802,885.87 348,504,685.37
Shougang Environmental Industry Co.,
Production service 5,359,304.37 4,790,641.42
Ltd.
Beijing Shougang Mining Construction
Engineering service 45,415,792.24 32,202,238.47
Co., Ltd.
Beijing Shougang Mining Construction
Production service 2,561,705.00 3,124,511.85
Co., Ltd.
Qinhuangdao Shouqin Metal Materials Engineering
-- 2,640,623.65
Co., Ltd. equipment
Qinhuangdao Shouqin Metal Materials
Raw material 4,858,002.24 --
Co., Ltd.
Beijing Shougang Industrial Group Co.,
Life service 2,497,949.85 5,463,312.46
Ltd.
Beijing Shougang Shape Metal Co., Ltd. Raw material 84,278.76 1,157,199.12
Beijing Dingshengcheng Packaging
Production service 139,524,911.82 132,716,435.98
Materials Co., Ltd.
Beijing Dingshengcheng Packaging
Auxiliary material 21,935,504.47 2,588,730.00
Materials Co., Ltd.
Beijing Dingshengcheng Packaging Engineering
3,991,680.00 --
Materials Co., Ltd. equipment
Beijing Shougang Cultural Development
Production service -- 580,274.11
Co., Ltd.
Jingxi Commercial Factoring Co., Ltd. Raw material 34,907,834.40 2,294,124.34
Qinhuangdao Shouqin Steel
Spare parts 125,823.00 202,712.00
Machining&Delivery Co., Ltd.
Shougang Casey Steel Co., Ltd. Production service 89,931,464.45 99,663,335.28
Tangshan Caofeidian First Real
Life service 92,796,533.86 103,510,367.58
Industrial Co., Ltd.
Tangshan Caofeidian First Real
Spare parts 899,038.00 2,092,860.00
Industrial Co., Ltd.
Qiangang Hotel. Production service 19,213,783.47 20,138,607.00
Beijing Shougang Yunxiang Industrial
Spare parts 698,000.00 8,985,583.27
Technology Co., Ltd.
182
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Bohai International Conference Center
Life service 1,709,776.21 872,777.64
Co., Ltd.
Hebei Shoulang New Energy
Power energy 6,469,733.18 5,228,810.04
Technology Co., Ltd.
Qian'an Shougang Xingkuang Industrial
Auxiliary material 46,113,178.52 46,730,677.66
Co., Ltd.
Beijing Thermal Zhongda Heat
Spare parts 18,071,736.05 21,599,664.94
Exchange Equipment Co., Ltd.
Beijing Thermal Zhongda Heat
Production service 12,965,317.00 11,997,608.00
Exchange Equipment Co., Ltd.
Guangzhou Jinghai Shipping Co., Ltd. Production service 287,392,610.41 355,036,509.27
PetroChina Shougang (Beijing)
Spare parts 53,721,366.22 61,667,449.21
Petroleumsales Co., Ltd.
PetroChina Shougang (Beijing)
Production service 757,558.65 810,772.36
Petroleumsales Co., Ltd.
Beijing Shoushe Metallurgical Engineering
1,221,243.79 255,912.13
Technology Co., Ltd. equipment
Beijing Shouyu Industry and Trade Co.,
Auxiliary material 15,867,277.30 11,422,545.27
Ltd.
Chaoyang Shougang Beifang Machinery
Spare parts -- 9,600.00
Co., Ltd.
Tangshan Caofeidian Ganglian Logistics
Production service 224,986,462.57 179,731,432.37
Co., Ltd.
Tangshan Caofeidian Industry Port Co.,
Production service 484,456,068.34 476,275,284.06
Ltd.
Tianjin Shougang Steel
Production service 3,193,694.14 3,093,058.92
Processing&Distribution Co., Ltd.
Tianjin Shougang Steel
Raw material 439,639,719.08 137,219.49
Processing&Distribution Co., Ltd.
Beijing Shoutaizhongxin Science &
Spare parts 14,541,804.30 20,983,879.94
Technology Co., Ltd
Chengde Xintong Shoucheng Mining
Raw material -- 180,923,753.72
Co., Ltd.
Shougang (Qingdao) Steel Industry Co.,
Raw material 4,013,015.40 908,220.09
Ltd.
Beijing Shougang Park Comprehensive
Life service 2,102,293.89 1,477,352.85
Service Co., Ltd.
YASKAWA Shougang Robert Co., Ltd. Production service -- 141,500.00
Qinhuangdao Shougang Racing Valley
Production service 377,358.48 431,358.48
Co., Ltd
Hebei Shougang Jingtang Machinery
Production service 82,765,129.40 37,269,512.82
Co., Ltd.
Beijing Shouao Real Estate Co., Ltd Life service 93,085.00 23,794.00
Engineering
Cmi Engineering (Beijing) Co., Ltd. 17,268,900.00 12,892,700.00
equipment
Shougang Changzhi Steel&Iron Co.,
Raw material -- 1,509,854.85
Ltd.
South China International Leasing Co.,
Fund usage charges 373,598.24 751,226.41
Ltd
Beijing Shouxin Jinyuan Management
Fund usage charges -- 21,900,000.00
Consulting Center (Limited Partnership)
183
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Qinhuangdao Shoufang Property
Life service -- 861,700.00
Service Co., Ltd.
Qian'an Jinyu Shougang Environmental
Production service 26,093,417.36 23,335,032.81
Protection Technology Co., Ltd.
Beijing Shougang Property Management
Production service 2,907,210.97 2,935,902.84
Co., Ltd.
Guiyang Steel Mills I/E Corp. Production service 8,011,169.36 13,153,495.39
Gansu Province, Wenxian Million Litie
Raw material 326,252,685.09 936,100,776.46
Alloy Co., Ltd.
Tangshan Caofeidian Dunshi New
Production service 2,918,833.30 1,858,061.44
Construction Material Co., Ltd.
Beijing Shouyi Mining Hospital Co.,
Production service 2,417,059.93 3,486,466.50
Ltd.
Peking University Shougang Hospital Production service 512,567.00 122,228.18
Beijing Shougang Construction
Production service -- 15,000.00
Investment Co., Ltd.
Engineering
Shougang Yili Steel Co., Ltd. -- 2,096,637.16
equipment
Tangshan Shougang Malanzhuang Iron
Raw material 215,116,886.67 407,104,956.47
Ore Co., Ltd.
Jingtang Port Shougang Terminal Co.,
Production service 2,384,905.66 6,091,794.34
Ltd.
Beijing Shoufang Commercial
Production service 783,360.00 --
Management Co., Ltd
②Sale of goods and rendering of services to related parties
Nature of
Related party 2023 2022
transaction
Management
Shougang Group Co., Ltd. 122,756,957.25 233,378,200.00
service
Shougang Group Co., Ltd. Production service 16,392,473.96 16,202,255.66
Shougang Mining Corporation Steel 576,096.86 2,076,407.04
Shougang Mining Corporation Raw fuel material 19,618,852.83 11,262,064.60
Shougang Mining Corporation Power energy 615,727.71 127,160.60
Shougang Mining Corporation Production service 14,472,724.25 15,600,062.87
Shougang Group Finance Co., Ltd. Interest income 105,646,555.72 130,624,439.00
Qian'an Sinochem Coal Chemical
Power energy 233,075,163.68 247,263,882.72
Industrial Co., Ltd.
Shougang Casey Steel Co., Ltd. Steel 288,823,600.47 535,645,904.62
Shougang Casey Steel Co., Ltd. Production service 1,285,724.26 1,136,801.76
Beijing Shougang Construction Group
Power energy 5,179,677.62 3,264,125.51
Co., Ltd.
Beijing Shougang Construction Group
Steel 15,705,817.85 9,098,035.59
Co., Ltd.
Beijing Shougang Construction Group
Production service 642,905.16 1,985,086.15
Co., Ltd.
184
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Beijing Shougang Gas Co., Ltd. Power energy 132,914,533.68 109,972,645.95
Beijing Shougang Gas Co., Ltd. Production service 126,600.27 80,800.83
Beijing Shougang Machinery&Electric
Steel 615,820,168.93 613,930,630.06
Co., Ltd.
Beijing Shougang Machinery&Electric
Power energy 3,496,581.23 3,913,938.59
Co., Ltd.
Beijing Shougang Machinery&Electric
Production service 1,568,551.19 1,604,228.13
Co., Ltd.
Beijing Shougang Ferroalloy Co., Ltd. Power energy 4,263,420.65 3,676,369.55
Beijing Shougang Ferroalloy Co., Ltd. Raw fuel material 17,872,976.23 21,241,039.12
Beijing Shougang Ferroalloy Co., Ltd. Production service 515,191.79 473,569.14
Tangshan Shougang Jingtang Xishan
Power energy 943,495,390.00 707,298,397.35
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Production service 242,927,266.39 221,751,315.34
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Raw material -- 1,041,626.43
Coking Co., Ltd.
Beijing Beiye Functional Materials Co.,
Billet 1,714,757.18 8,300,691.98
Ltd.
Beijing Shougang Gitane New
Production service 141,509.43 --
Materials Co., Ltd.
Beijing Shougang Huaxia
Raw fuel material 6,302,931.53 6,901,691.83
Engineering&Technology Co., Ltd.
Beijing Shougang Huaxia
Production service -- 118,539.00
Engineering&Technology Co., Ltd.
Beijing Shoucheng Packaging Service
Steel 4,424.78 3,649,548.62
Co., Ltd.
Beijing Shoucheng Packaging Service
Power energy 306,515.16 359,523.37
Co., Ltd.
Beijing Shoucheng Packaging Service
Production service 1,868,192.00 1,872,706.78
Co., Ltd.
Qian'an First Real Packaging Service
Steel 124,456,820.34 102,754,677.80
Co., Ltd.
Beijing Shouronghui Technology
Steel 18,339,265.07 41,264,142.20
Development Co., Ltd.
Tangshan Caofeidian Dunshi New
Raw fuel material 66,729,964.35 167,597,204.04
Construction Material Co., Ltd.
Tangshan Caofeidian Dunshi New
Power energy 134,503,437.66 139,527,704.49
Construction Material Co., Ltd.
Tangshan Caofeidian Dunshi New
Production service 29,024,124.84 28,288,337.62
Construction Material Co., Ltd.
Beijing Shougang International
Production service 28,301.89 1,342,075.48
Engineering&Technology Co., Ltd.
Beijing Shougang Metal Co., Ltd. Steel 841,013.59 40,394,334.29
Beijing Shougang Metal Co., Ltd. Power energy 1,090,805.84 1,445,681.43
Beijing Shougang Metal Co., Ltd. Production service 2,754,311.93 2,754,311.93
Beijing Shougang Mining Construction
Steel 420,015.67 9,394.34
Co., Ltd.
185
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Tangshan Caofeidian Industrial District
Steel 7,901,199.61 --
Shouhanxin Industrial Co., Ltd.
Qinhuangdao Shougang Machinery Co.,
Raw fuel material 624,127,356.87 579,784,184.94
Ltd.
Qinhuangdao Shougang Machinery Co.,
Power energy 1,246,694.69 541,746.35
Ltd.
Qinhuangdao Shougang Machinery Co.,
Production service 1,060,194.56 653,463.03
Ltd.
Qian'an Shougang Equipment Structure
Production service 256,293.58 221,876.15
Co., Ltd.
Qian'an Shougang Equipment Structure
Steel 2,302,743.68 3,027,566.84
Co., Ltd.
Tangshan Guoxing Industrial Co., Ltd. Power energy 2,013,000.88 1,720,010.15
Tangshan Guoxing Industrial Co., Ltd. Raw fuel material 739,083.24 1,253,595.05
Tangshan Guoxing Industrial Co., Ltd. Production service 1,810,872.92 1,736,728.31
Tangshan Caofeidian Industrial Zone
Power energy -- 55,369.38
Jingtang Industrial Co., Ltd.
Tangshan Caofeidian First Real
Power energy 855,939.30 906,051.87
Industrial Co., Ltd.
Tangshan Caofeidian First Real
Production service 78,840.97 14,716.98
Industrial Co., Ltd.
Tangshan Caofeidian First Real
Raw fuel material 20,024.23 --
Industrial Co., Ltd.
Beijing Shougang Automation
Power energy 86,227.79 23,403.49
Information Technology Co., Ltd.
Beijing Shougang Automation
Production service 1,469,843.53 1,045,424.53
Information Technology Co., Ltd.
Hebei Shoulang New Energy
Power energy 118,774,891.36 123,024,177.15
Technology Co., Ltd.
Hebei Shoulang New Energy
Production service -- 2,142,857.14
Technology Co., Ltd.
Beijing Jinanyuan Automobile
Production service 198,165.14 198,165.14
Transportation Co., Ltd.
Beijing Jinanyuan Automobile
Power energy 1,536,753.62 990,792.19
Transportation Co., Ltd.
Tonghua Iron and Steel Co., Ltd. Raw fuel material 410,849.06 283,018.87
Lujiashan Limestone Mining of
Raw fuel material -- 2,764,398.78
Shougang Beijing Co., Ltd.
Lujiashan Limestone Mining of
Raw fuel material 99,056.60 --
Shougang Beijing Co., Ltd.
Beijing Shougang Materials Trading
Production service 5,578.30 54,194.35
Co., Ltd.
Qinhuangdao Shounai New Materials
Steel 6,370,392.42 --
Co., Ltd
Qinhuangdao Shounai New Materials
Raw fuel material 41,493.59 --
Co., Ltd
Shougang Changzhi Steel&Iron Co.,
10,970,355.00 --
Ltd.
Shougang Changzhi Steel&Iron Co.,
Production service 707,547.16 141,509.43
Ltd.
186
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Tangshan Caofeidian Industry Port Co.,
Power energy 3,464,678.00 3,778,635.00
Ltd.
Tangshan Zhonghong Carbon Chemical
Interest income 8,990,991.36 11,275,389.73
Co., Ltd.
Ningbo Shougang Zhejin Steel Co., Ltd. Steel 228,910,735.54 432,375,321.23
Shougang (Qingdao) Steel Industry Co.,
Steel 1,587,159,531.37 1,935,625,780.26
Ltd.
Shougang (Qingdao) Steel Industry Co.,
Production service 212.37 7,346,687.79
Ltd.
Tianjin Shougang Steel
Steel 478,621,811.95 27,569,222.18
Processing&Distribution Co., Ltd.
Qian'an Shoujia Construction Material
Power energy 22,655,171.59 22,884,203.10
Co., Ltd.
Qian'an Shoujia Construction Material
Raw fuel material 18,526,007.89 36,514,508.74
Co., Ltd.
Qian'an Shoujia Construction Material
Production service 248,418.37 248,418.37
Co., Ltd.
Beijing Dingshengcheng Packaging
Power energy 34,272.49 24,442.68
Materials Co., Ltd.
Beijing Dingshengcheng Packaging
Production service 238,634.36 19,625.66
Materials Co., Ltd.
Guizhou Bohong Industrial Co., Ltd. Production service 97,762.04 129,836.50
Beijing Shougang Landscaping Co.,
Power energy 1,625.67 1,430.47
Ltd.
Dachang Shougang
Steel -- 1,547,925.87
Machinery&Electric Co., Ltd.
Guangzhou Jinghai Shipping Co., Ltd. Production service 40,174,324.26 50,495,018.05
PetroChina Shougang (Beijing)
Power energy 25,430.60 32,357.74
Petroleumsales Co., Ltd.
PetroChina Shougang (Beijing)
Steel 31,946,816.54 65,202,291.10
Petroleumsales Co., Ltd.
Qian'an Shougang Xingkuang Industrial
Steel 30,810,804.11 35,007,815.91
Co., Ltd.
Beijing Shougang Gas Tangshan Co.,
Production service 565,714.29 235,714.29
Ltd.
Beijing Shougang Catering Co., Ltd. Power energy 270,031.08 524,090.49
Beijing Jingxi Supply Chain
Steel -- 64,207,092.86
Management Co., Ltd.
Guizhou Liupanshui Shenghongda
Mechanical Equipment Manufacturing Production service -- 65,725.38
Co., Ltd
Guizhou Shuigang Logistics Co., Ltd. Production service 137,151.19 157,558.15
Shougang Shuicheng Iron and Steel
(Group) Xingyuan Development Production service -- 26,335.85
Investment Co., Ltd.
Hebei Jingji Industry & Trading Co.,
Steel 4,690,630.50 8,578,020.68
Ltd.
Qian'an Jinyu Shougang Environmental
Raw fuel material 22,281,604.59 2,194,885.15
Protection Technology Co., Ltd.
Qian'an Jinyu Shougang Environmental
Power energy 31,498,960.08 901,796.43
Protection Technology Co., Ltd.
187
Beijing Shougang Co. Ltd Annual Report 2023
Nature of
Related party 2023 2022
transaction
Qian'an Jinyu Shougang Environmental
34,105.09 --
Protection Technology Co., Ltd.
Jingtang Port Shougang Terminal Co.,
Production service 372,689.61 327,224.25
Ltd.
Shoujia Huanke (Qian'an) Co., Ltd. Raw fuel material 30,939,313.95 26,345,440.31
Beijing Shoujian Equipment
Production service 2,343.39 --
Maintenance Co., Ltd.
Beijing Shoujia Steel Construction Co.,
Power energy 1,436,870.97 1,160,424.21
Ltd.
Beijing Thermal Zhongda Heat
Production service 12,974.53 8,962.26
Exchange Equipment Co., Ltd.
Beijing Shougang Lanzatech Co., Ltd. Production service -- 727,265.93
Tangshan Tangcao Railway Co., Ltd. Production service 323,773.56 3,323,611.75
Beijing Shougang Chengyun Holdings
Steels 218,448,717.31 --
Co., Ltd
Beijing Shougang Resources
Comprehensive Utilization Technology Raw fuel material 510,865.44 --
Development Co., Ltd.
Shougang Shuicheng Steel (Group) Co.,
Production service 471,698.12 --
Ltd
(2) Details of related party leases
① The Company as a lessor
Type of assets Lease income recognized in Lease income recognized in
Lessee
leased 2023 2022
Qian'an Sinochem Coal Chemical
Land use right 1,065,067.58 1,065,067.58
Industrial Co., Ltd.
Tangshan Shougang Jingtang Xishan
Land use right 25,046,418.55 25,046,418.55
Coking Co., Ltd.
Tangshan Caofeidian Dunshi New
Land use right 2,380,761.90 2,380,761.90
Construction Material Co., Ltd.
Beijing Shougang Lanzatech Co., Ltd. Land use right 1,879,619.04 165,333.33
Hebei Shoulang New Energy
Plant and buildings 2,208,517.11 --
Technology Co., Ltd.
② The Company as a lessee
Type of assets Lease expenses recognized in Lease expenses recognized in
Lessor
leased 2023 2022
Shougang Group Co., Ltd. Plant and buildings 25,987,077.88 2,856,131.74
Beijing Shougang Construction
Plant and buildings 10,139,897.90 10,139,897.90
Investment Co., Ltd.
Newly added right-of-use assets during the reporting period
Type of assets Increase in the previous
Lessor increase in the current period
leased period
Shougang Group Co., Ltd. Plant and buildings 363,355,681.31 --
Interest expenses incurred on lease liabilities during the reporting period
188
Beijing Shougang Co. Ltd Annual Report 2023
Type of assets Interest expenses of the Interest expenses of the
Lessor
leased current period previous period
Shougang Group Co., Ltd. Plant and buildings 17,135,143.96 1,470,426.80
Beijing Shougang Construction
Plant and buildings 1,160,311.85 1,566,004.04
Investment Co., Ltd.
(3) Details of related party guarantees
① The Company as a guarantor
Status of
Guarantee Amount of guarantee Beginning date Maturity date
guarantee
Ningbo Shougang Zhejin Steel Co.,
32,755,200.00 2023/2/15 2024/8/28 Incomplete
Ltd.
Shougang (Qingdao) Steel Industry
142,030,000.00 2023/9/18 2024/12/25 Incomplete
Co., Ltd.
Shanghai Shougang Steel & Iron
48,750,000.00 2023/7/17 2024/3/22 Incomplete
Trading Co., Ltd.
② The Company as a guarantee
Status of
Guarantor Amount of guarantee Beginning date Maturity date
guarantee
Shougang Group Co., Ltd. 5,094,415,277.76 2023/3/27 2024/11/29 Incomplete
Shougang Group Co., Ltd. 8,811,562,222.22 2019/9/6 2031/9/6 Incomplete
(4) Related party financing
Related party Closing balance Beginning date Maturity date Note
Shougang Group Co., Ltd. 54,107,510.15 2022/3/21 2026/11/24 Entrust loans
Shougang Group Finance Co., Ltd. 10,475,231,798.30 2023/1/28 2024/12/27 Short-term loans
Shougang Group Finance Co., Ltd. 1,601,119,444.44 2022/11/4 2026/12/22 Long-term loans
Shougang Group Finance Co., Ltd. 3,258,752,366.00 2023/7/21 2024/6/27 Notes payable
(5) Asset transfer and debt restructuring of related parties
Content of related party
Related party 2023 2022
transactions
Sale of equity and debt of
Beijing Shougang Special Steel Co., Ltd. 221,871,680.02 --
Zhonghong Co.
Hebei Shoulang New Energy Technology Purchase of plant and
49,809,259.88 --
Co., Ltd. buildings
Purchase of the pelletizing
Shougang Mining Corporation -- 1,300,325,799.36
-sintering business
(6) Remuneration of key management personnel
The Company has 21 key management personnel in 2023, and 22 key management personnel in
2022. The remuneration payment is as follows:
Item 2023 2022
189
Beijing Shougang Co. Ltd Annual Report 2023
Item 2023 2022
Remuneration of key management personnel
6.4573 million 8.6681 million
(excluding share payment)
190
Beijing Shougang Co. Ltd Annual Report 2023
6. Receivables from and payables to related parties
(1) Receivables from related parties
As at 31 December 2023 As at 31 December 2022
Item Related party
Book balance Provision for bad debts Book balance Provision for bad debts
Bank deposits Shougang Group Finance Co., Ltd. 9,128,608,670.91 -- 8,782,663,274.02 --
Bank deposits Hua Xia Bank Co.,Ltd. 1,453,039.82 -- 6,713,364.79 --
Accounts receivable Shougang Group Co., Ltd. -- -- 57,479.37 2,047.03
Accounts receivable Shougang Casey Steel Co., Ltd. 264,947,857.43 9,471,484.77 290,361,751.31 10,336,878.35
Beijing Shougang Huaxia Engineering&Technology
Accounts receivable 1,748,412.19 1,245,897.88 1,748,412.19 487,967.75
Co., Ltd.
Accounts receivable Hebei Shoulang New Energy Technology Co., Ltd. -- -- 34,418,648.92 1,225,303.90
Accounts receivable Qian'an Shoujia Construction Material Co., Ltd. 50,221,363.06 1,795,337.69 56,221,363.06 2,002,230.58
Accounts receivable Sanhe Shoujia Construction Material Co., Ltd. -- -- 8,775,968.24 8,214,183.99
Accounts receivable Qinhuangdao Shouqin Metal Materials Co., Ltd. -- -- 1,438,064.93 1,070,495.53
Accounts receivable Tonghua Iron and Steel Co., Ltd. 382,500.00 13,673.79 506,248.00 17,810.17
Tangshan Caofeidian Dunshi New Construction
Accounts receivable 1,185,255.36 42,195.09 -- --
Material Co., Ltd.
Beijing Shougang International
Accounts receivable 354,540.00 259,370.68 428,540.00 297,559.83
Engineering&Technology Co., Ltd.
Accounts receivable Qian'an Shougang Xingkuang Industrial Co., Ltd. 8,776,606.90 313,750.41 6,617,509.64 235,583.34
Accounts receivable Beijing Shougang Mining Construction Co., Ltd. -- -- 9,958.00 349.19
Accounts receivable Tangshan Shougang Jingtang Xishan Coking Co., Ltd. -- -- 734.50 218.70
Accounts receivable Beijing Shougang Machinery&Electric Co., Ltd. 53,000.00 1,887.51 100,000.00 3,561.33
Beijing Shouke Xingye Engineering Technology Co.,
Accounts receivable 400,000.00 298,885.25 400,000.00 112,210.59
Ltd.
191
Beijing Shougang Co. Ltd Annual Report 2023
As at 31 December 2023 As at 31 December 2022
Item Related party
Book balance Provision for bad debts Book balance Provision for bad debts
Accounts receivable Tangshan Tangcao Railway Co., Ltd. 3,866,228.46 138,211.81 3,523,028.46 125,419.81
Accounts receivable Beijing Shougang Construction Group Co., Ltd. -- -- 37,260.00 1,306.55
Beijing Shougang Automation Information Technology
Accounts receivable 1,285,250.00 45,945.74 771,150.00 27,041.00
Co., Ltd.
Accounts receivable Jingtang Port Shougang Terminal Co., Ltd. 30,209.98 1,079.96 -- --
Accounts receivable Guangzhou Jinghai Shipping Co., Ltd. 7,594,241.02 270,354.98 -- --
Prepayments Tonghua Iron and Steel Co., Ltd. 15,507,934.68 -- 20,254,497.50 --
Prepayments Tangshan Caofeidian Ganglian Logistics Co., Ltd. 312,574,923.41 -- 87,043,657.93 --
Prepayments Tangshan Caofeidian Industry Port Co., Ltd. 268,987.95 -- 1,760,930.71 --
Prepayments Beijing Jinanyuan Automobile Transportation Co., Ltd. -- -- 4,996,705.97 --
Prepayments Shougang Group Co., Ltd. 959,767,074.26 -- 74,027,519.11 --
Prepayments Cmi Engineering (Beijing) Co., Ltd. -- -- 50,850.00 --
China Shougang International Trade&Engineering
Prepayments -- -- 7,633,348.80 --
Corporation
Tianjin Shougang Steel Processing&Distribution Co.,
Prepayments 2,045,860.74 -- 4,171,441.39 --
Ltd.
Prepayments Shougang Changzhi Steel&Iron Co., Ltd. 7,609.04 -- 7,609.04 --
Beijing Shougang International
Prepayments 8,894,098.32 -- -- --
Engineering&Technology Co., Ltd.
Dividend receivable Guangzhou Jinghai Shipping Co., Ltd. -- -- 200,000.00 --
Dividend receivable Hebei Jingji Industry & Trading Co., Ltd. 2,407,634.67 -- -- --
Other current assets Tangshan Zhonghong Carbon Chemical Co., Ltd. -- -- 285,013,761.81 118,133,658.14
Other current assets Beijing Shougang Special Steel Co., Ltd. 109,717,639.69 -- -- --
192
Beijing Shougang Co. Ltd Annual Report 2023
(2) Payables to related parties
As at 31 December As at 31 December
Item Related party
2023 2022
Accounts payable Shougang Group Co., Ltd. 617,236,361.47 655,732,407.11
Accounts payable Shougang Mining Corporation 4,100,739,052.40 4,125,595,337.09
Accounts payable Qian'an Sinochem Coal Chemical Industrial Co., Ltd. 348,423,301.67 470,845,391.07
Accounts payable Tangshan Shougang Jingtang Xishan Coking Co., Ltd. 1,621,788,863.85 1,859,004,046.73
Accounts payable Beijing Shoucheng Packaging Service Co., Ltd. 21,962,155.16 13,350,654.51
Beijing Shougang Automation Information Technology
Accounts payable 214,716,103.28 182,889,510.51
Co., Ltd.
Accounts payable Beijing Shougang Construction Group Co., Ltd. 759,749,400.49 618,622,996.56
Accounts payable Beijing Shoujian Equipment Maintenance Co., Ltd. 29,907,449.12 25,594,363.58
Accounts payable Beijing Shougang Landscaping Co., Ltd. 14,095,207.11 23,883,634.56
Accounts payable Beijing Shougang Catering Co., Ltd. 1,302,386.27 1,327,588.66
Accounts payable Beijing Huaxia Technology Co., Ltd. 7,672,411.53 5,762,815.76
Accounts payable Qinhuangdao Shougang Machinery Co., Ltd. 75,135,460.40 64,415,151.43
Accounts payable Beijing Shougang Machinery&Electric Co., Ltd. 119,512,621.21 162,405,176.47
Accounts payable Beijing Shouye Instruments&Meters Co., Ltd. 14,752,752.88 13,442,009.63
Accounts payable Tianjin Shougang Electric Equipment Co., Ltd. 10,175,030.28 9,099,757.38
Accounts payable Beijing Shougang Gas Co., Ltd. 71,674,494.52 66,619,195.56
Beijing Shougang International
Accounts payable 92,902,894.43 310,818,935.04
Engineering&Technology Co., Ltd.
Accounts payable Beijing Jinanyuan Automobile Transportation Co., Ltd. 20,439,879.74 15,100,355.24
Lujiashan Limestone Mining of Shougang Beijing Co.,
Accounts payable 258,149,223.68 158,972,406.25
Ltd.
Accounts payable Qian'an Shougang Equipment Structure Co., Ltd. 88,296,034.17 85,360,764.98
Accounts payable Yantai Shougang Mining 3D Co., Ltd. 93,301.72 313,811.63
Beijing Shoujian Hengji Construction Engineering Co.,
Accounts payable 1,080,783.29 1,602,115.93
Ltd.
Accounts payable Beijing Soly Technology Co., Ltd. 174,438.35 210,904.43
Qian'an Shouxin Automation Information Technology
Accounts payable 22,896,773.32 25,515,132.74
Co., Ltd.
Accounts payable Qian'an First Real Packaging Service Co., Ltd. 156,728,118.14 96,388,811.17
Accounts payable Beijing Shoujia Steel Construction Co., Ltd. 10,670,314.99 14,995,775.16
Accounts payable Beijing Shougang Ferroalloy Co., Ltd. 141,480,547.64 73,607,022.86
Accounts payable Beijing Shougang Materials Trading Co., Ltd. 2,525,304,259.02 426,891,995.64
Beijing Shougang Resources Comprehensive Utilization
Accounts payable 47,067,143.46 57,690,426.64
Technology Development Co., Ltd.
Accounts payable Shougang Environmental Industry Co., Ltd. 1,216,050.02 334,080.00
193
Beijing Shougang Co. Ltd Annual Report 2023
As at 31 December As at 31 December
Item Related party
2023 2022
China Shougang International Trade&Engineering
Accounts payable 686,572,104.40 663,787,332.95
Corporation
Accounts payable Beijing Chengxin Engineering Supervision Co., Ltd. 6,158,477.69 6,127,851.86
Accounts payable Qinhuangdao Shounai New Materials Co., Ltd 54,520,129.50 61,808,291.36
Accounts payable Tangshan Guoxing Industrial Co., Ltd. 57,113,565.06 40,465,093.70
Tangshan Caofeidian Industrial District Shouhanxin
Accounts payable 161,334,340.20 138,903,339.92
Industrial Co., Ltd.
Accounts payable Beijing Shougang Futong Elevator Co., Ltd. 259,255.15 310,319.85
Accounts payable Beijing Teyu Plate Co., Ltd. -- 85,095,430.63
Accounts payable Jingxi Shoutang Supply Chain Management Co., Ltd 926,863.54 9,289,106.10
Accounts payable Beijing Shougang Mining Construction Co., Ltd. 10,935,689.65 3,354,289.89
Accounts payable Qinhuangdao Shouqin Metal Materials Co., Ltd. 13,995,879.69 19,824,419.55
Qinhuangdao Shouqin Steel Machining&Delivery Co.,
Accounts payable 75,377.84 466,070.62
Ltd.
Accounts payable Beijing Shoushe Metallurgical Technology Co., Ltd. 326,107.50 14,002.60
Accounts payable Beijing Shougang Industrial Group Co., Ltd. 17,093,147.98 24,377,193.66
Accounts payable Bejing Shougang International Travel Co., Ltd. -- 8,688.00
Beijing Shougang Yunxiang Industrial Technology Co.,
Accounts payable 1,341,229.23 3,664,099.23
Ltd.
Accounts payable Qiangang Hotel. 10,105,306.58 8,662,628.97
Accounts payable Beijing Dingshengcheng Packaging Materials Co., Ltd. 22,330,278.82 17,452,797.76
Accounts payable Beijing Shougang Special Steel Co., Ltd. -- 94,949,940.33
Accounts payable Hebei Shougang Jingtang Machinery Co., Ltd. 22,699,470.87 18,999,797.17
Ningbo Metallurgical Investigation, Design&Research
Accounts payable -- 7,330,595.55
Co., Ltd.
Accounts payable Qian'an Shougang Xingkuang Industrial Co., Ltd. 11,977,326.09 4,945,999.84
Accounts payable Bohai International Conference Center Co., Ltd. 435,200.00 --
Beijing Thermal Zhongda Heat Exchange Equipment
Accounts payable 15,751,115.32 25,442,826.43
Co., Ltd.
Accounts payable Beijing Shouyi Mining Hospital Co., Ltd. 2,340,923.44 1,958,389.00
Accounts payable Beijing Shouyu Industry and Trade Co., Ltd. 8,789,176.18 7,177,859.06
Accounts payable PetroChina Shougang (Beijing) Petroleumsales Co., Ltd. 15,920,554.74 14,973,290.67
Accounts payable YASKAWA Shougang Robert Co., Ltd. -- 235,384.79
Accounts payable Beijing Shoubang New Material Co., Ltd. 2,280,758.30 2,927,759.28
Beijing Xingyeda Machinery&Electric Equipment
Accounts payable 757,903.49 1,820,277.82
Manufacture Co., Ltd.
Accounts payable Chaoyang Shougang Beifang Machinery Co., Ltd. 377,661.07 931,110.35
Accounts payable Chengde Xintong Shoucheng Mining Co., Ltd. -- 851,714.56
Accounts payable Guangzhou Jinghai Shipping Co., Ltd. 119,729,190.80 102,688,729.55
194
Beijing Shougang Co. Ltd Annual Report 2023
As at 31 December As at 31 December
Item Related party
2023 2022
Accounts payable Jingtang Port Shougang Terminal Co., Ltd. 2,177,836.25 --
Accounts payable Tangshan Caofeidian Industry Port Co., Ltd. 38,098,492.55 55,335,586.91
Accounts payable Shougang Guiyang Special Steel Co., Ltd. -- 6,975,000.00
Tianjin Shougang Steel Processing&Distribution Co.,
Accounts payable 183,740.76 149,948.85
Ltd.
Accounts payable Cmi Engineering (Beijing) Co., Ltd. 3,842,825.00 552,200.00
Beijing Shoutegang Yuandong Magnesium Alloy
Accounts payable 200,408.00 200,408.00
Products Co., Ltd.
Accounts payable Shougang (Qingdao) Steel Industry Co., Ltd. 991,395.09 1,545,599.81
Accounts payable Qinhuangdao Shougang Racing Valley Co., Ltd -- 95,860.00
Beijing Shougang Park Comprehensive Service Co.,
Accounts payable 39,144.42 2,300.00
Ltd.
Accounts payable Beijing Shouao Real Estate Co., Ltd 27,360.00 --
Beijing Shougang Environmental Engineering
Accounts payable 1,109,886.20 1,109,886.20
Technology Co., Ltd.
Accounts payable Guiyang Steel Mills I/E Corp. 3,941,759.44 4,161,841.55
Qian'an Jinyu Shougang Environmental Protection
Accounts payable 5,848,743.70 5,274,968.79
Technology Co., Ltd.
Accounts payable Shougang Commercial Factoring Co., Ltd. 4,360.34 17,148,576.40
Tangshan Caofeidian Dunshi New Construction Material
Accounts payable -- 1,888,425.49
Co., Ltd.
Accounts payable Tangshan Shougang Malanzhuang Iron Ore Co., Ltd. 160,584,083.43 132,159,697.12
Beijing Shoutaizhongxin Science & Technology Co.,
Accounts payable 10,432,612.75 6,185,421.93
Ltd
Accounts payable Peking University Shougang Hospital 3,337,370.93 3,088,704.96
Beijing Aidi Geological Engineering Technology Co.,
Accounts payable 251,381.00 --
Ltd
Accounts payable Beijing Shoufang Commercial Management Co., Ltd 354,240.00 --
Accounts payable Hebei Shoulang New Energy Technology Co., Ltd. 1,428,942.18 --
Geological Research Institute of Shougang Geological
Accounts payable 1,635,972.59 --
Exploration Institute
Contract liabilities Beijing Shoucheng Packaging Service Co., Ltd. 53,217.02 53,217.02
Beijing Shougang Huaxia Engineering&Technology
Contract liabilities 2,081,061.25 1,494,914.05
Co., Ltd.
Contract liabilities Beijing Beiye Functional Materials Co., Ltd. 62,368.53 34,194.22
Contract liabilities Beijing Shougang Gitane New MATERIALS Co., Ltd. 69,810.40 45,093.66
Contract liabilities Beijing Shouronghui Technology Development Co., Ltd. 4,246,745.24 6,564,678.23
Contract liabilities Beijing Shougang Machinery&Electric Co., Ltd. 17,532,836.64 9,143,010.03
Contract liabilities Beijing Shougang Construction Group Co., Ltd. 129,036.27 385,946.71
Tangshan Caofeidian Industrial District Shouhanxin
Contract liabilities 173,402.08 --
Industrial Co., Ltd.
Contract liabilities Qinhuangdao Shougang Machinery Co., Ltd. 1,488,091.21 1,031,671.69
195
Beijing Shougang Co. Ltd Annual Report 2023
As at 31 December As at 31 December
Item Related party
2023 2022
Tangshan Caofeidian Industrial Zone Jingtang Industrial
Contract liabilities -- 50,000.00
Co., Ltd.
Contract liabilities Qian'an First Real Packaging Service Co., Ltd. 2,145,700.29 2,164,319.43
Tangshan Caofeidian Dunshi New Construction Material
Contract liabilities 1,901,702.22 1,901,697.48
Co., Ltd.
Contract liabilities Beijing Shougang Industrial Group Co., Ltd. 17,356.29 --
Contract liabilities Beijing Jinanyuan Automobile Transportation Co., Ltd. 248,913.41 341,185.21
Contract liabilities Qian'an Shougang Equipment Structure Co., Ltd. 17,453.73 14,753.10
Contract liabilities Qinhuangdao Shougang Plate Mill Co., Ltd. -- 13,028.81
Contract liabilities Qinhuangdao Shounai New Materials Co., Ltd 1,329,141.87 182,697.15
Contract liabilities Shougang Changzhi Steel&Iron Co., Ltd. 33,498.85 --
Lujiashan Limestone Mining of Shougang Beijing Co.,
Contract liabilities 1,378,893.98 1,378,893.98
Ltd.
Contract liabilities Qian'an Shougang Xingkuang Industrial Co., Ltd. -- 50,000.00
Contract liabilities Beijing Shougang Materials Trading Co., Ltd. 188,861.00 188,861.00
Contract liabilities Guizhou Bohong Industrial Co., Ltd. 52,093.30 50,000.00
Contract liabilities Beijing Shougang Mining Construction Co., Ltd. 203,221.14 52,088.04
Contract liabilities Tianjin Shougang Electric Equipment Co., Ltd. 169.19 169.19
Shougang Shuicheng Steel (Group) Saide Construction
Contract liabilities 805.61 805.61
Co., Ltd.
Contract liabilities Dachang Shougang Machinery&Electric Co., Ltd. 2,503.67 2,503.67
Contract liabilities Ningbo Shougang Zhejin Steel Co., Ltd. 3,069,243.35 18,320,032.79
Contract liabilities Guangzhou Jinghai Shipping Co., Ltd. -- 810,846.20
Suzhou Tonggang Shunye Steel Materials Processing
Contract liabilities 2,046.68 2,046.68
Distribution Co., Ltd.
Contract liabilities Beijing Shougang Shape Metal Co., Ltd. -- 995,551.60
Contract liabilities PetroChina Shougang (Beijing) Petroleumsales Co., Ltd. 2,026,489.96 7,184,262.58
Contract liabilities Shougang Casey Steel Co., Ltd. 9,932.40 51,682.17
Contract liabilities Shougang (Qingdao) Steel Industry Co., Ltd. 173,809,379.60 154,086,174.29
Tianjin Shougang Steel Processing&Distribution Co.,
Contract liabilities 1,999,256.25 --
Ltd.
Contract liabilities Chaoyang Shougang Beifang Machinery Co., Ltd. 114.02 114.02
Contract liabilities Beijing Shouyu Industry and Trade Co., Ltd. 58,437.91 58,437.91
Contract liabilities Hebei Jingji Industry & Trading Co., Ltd. -- 487,472.16
Beijing Thermal Zhongda Heat Exchange Equipment
Contract liabilities 50,000.00 50,000.00
Co., Ltd.
Contract liabilities Beijing Shoujian Equipment Maintenance Co., Ltd. 50,000.00 50,000.00
Qian'an Jinyu Shougang Environmental Protection
Contract liabilities 252,503.72 111,022.04
Technology Co., Ltd.
196
Beijing Shougang Co. Ltd Annual Report 2023
As at 31 December As at 31 December
Item Related party
2023 2022
Contract liabilities Shoujia Huanke (Qian'an) Co., Ltd. 200,000.00 200,000.00
Contract liabilities Beijing Shoujia Steel Construction Co., Ltd. 249,169.44 198,653.22
Contract liabilities Beijing Huaxia Technology Co., Ltd. 50,848.96 50,000.00
Contract liabilities Beijing Jingxi Supply Chain Management Co., Ltd. -- 747,440.91
Beijing Shougang Resources Comprehensive Utilization
Contract liabilities 50,000.00 --
Technology Development Co., Ltd.
Contract liabilities Hebei Shoulang New Energy Technology Co., Ltd. 26,158,105.48 --
Contract liabilities Shougang Mining Corporation 474,597.55 --
Contract liabilities Beijing Shougang Chengyun Holdings Co., Ltd 4,808.33 --
Other payables Shougang Group Co., Ltd. 56,517,064.49 56,575,231.05
Other payables Shougang Mining Corporation -- 796,194,091.55
Other payables Beijing Shougang Construction Group Co., Ltd. 3,450,000.00 3,450,000.00
Other payables Beijing Shougang Industrial Group Co., Ltd. 4,114,347.23 3,865,587.23
Other payables Tangshan Guoxing Industrial Co., Ltd. 4,450,973.55 4,450,973.55
Other payables Beijing Shougang Gas Co., Ltd. 1,123,099.67 1,123,099.67
Other payables Hebei Shougang Jingtang Machinery Co., Ltd. 2,776,577.52 2,776,577.52
Tangshan Caofeidian Industrial Zone Jingtang Industrial
Other payables 2,910,814.91 2,910,814.91
Co., Ltd.
Other payables Qinhuangdao Shougang Machinery Co., Ltd. 536,392.00 --
Other payables Guangzhou Jinghai Shipping Co., Ltd. 357,800.00 --
Beijing Shouxin Jinyuan Management Consulting
Other payables -- 341,400,000.00
Center (Limited Partnership)
Other current
Shougang Commercial Factoring Co., Ltd. 1,147,263,122.85 --
liabilities
Other non-current
Shougang Group Co., Ltd. 3,899,674,951.80 4,532,018,467.20
liabilities
XII. Share-based payment
1. General information of share-based payment
Current period grants Current period exercises Current period unlock Current period invalid
Types of object
Quantity Amount Quantity Amount Quantity Amount Quantity Amount
Staff -- -- -- -- -- -- 25,257,565.00 80,303,655.91
Stock options or other equity instruments issued to the public at the end of the period
Stock options issued Other equity instruments issued
Types of object Range of exercise Remaining term Range of exercise
Remaining term of the contract
price of the contract price
11 months (33%), 23 months
Staff -- -- 3.25
(34%)
2. Equity-settled share-based payment
197
Beijing Shougang Co. Ltd Annual Report 2023
The price of restricted stock shall be
The method of determining the fair value of equity instrument on the grant date determined at the closing price on the grant
date
Important parameters of fair value of equity instruments on grant date N/A
Based on the latest changes in the number of
employees with exerciseable rights and
Basis for determining the number of exerciseable equity instruments subsequent information, make the best
estimate of the number of equity instruments
with feasible rights and interests
Reasons for significant difference between the current estimate and previous
Performance conditions not met
estimate
Accumulated amount of equity settled share-based payments recognized in capital
37,992,492.22
reserve
The total amount of expenses recognized for equity settled share-based payments in
-12,462,167.10
this period
3. Current share based payment expenses
Notes: On 29 November 2021, approved by Beijing State Owned Assets Supervision and
Administration Commission, confirmed with no objection and recorded by China Securities
Regulatory Commission, Proposal on Beijing Shougang Co., Ltd.2021 Restricted Stock Incentive
Plan (Draft Amendment)and its Summary, Proposal of Beijing Shougang Co., Ltd.2021 Restricted
Stock Incentive Plan Implementation Assessment Management Method (Revised), Beijing
Shougang Co., Ltd. 's Proposal on requesting the General Meeting of Shareholders to authorize the
Board of Directors to handle matters related to 2021 Restricted stock Incentive Plan were
considered and approved at the seventh meeting of the eleventh Board of Directors and the first
extraordinary General Meeting of the year 2021 of the Company. The grant date was 9 December
2021 and a total of 64,901,800.00 restricted stock shares were granted to 386 incentive objects. The
grant price of the restricted stock is RMB3.25 per share. After the completion of subscription of this
incentive plan, as a result of additional issuance of new shares, the Company's share capital and
capital reserve increased by RMB 64,901,800.00 and RMB 146,029,050.00 respectively, and
treasury shares increased by RMB 210,930,850.00. At the same time, equity incentive repurchase
obligations are recognized in RMB 210,930,850.00 in other payables. The restriction period of
restricted shares granted by the incentive plan shall be 24 months, 36 months and 48 months
respectively from the registration date of the corresponding partial equity grant. The restricted
shares granted under this incentive Plan shall not be transferred, used for security or debt repayment
during the restricted sale period.
The Company has provided lock-up periods and unlock-up conditions for the stock granted to the
incentive subjects by way of non-public offering, and the Company has fully recognized other
payables - restricted stock repurchase obligations and treasury share in respect of the repurchase
obligations based on the subscription amounts received. If the unlocking conditions specified in the
final Equity Incentive Plan are not met, the Company will repurchase the shares at the grant price
and write down the outstanding shares. The portion of restricted stock that meets the unlocking
conditions is offset from the treasury share.
Due to the performance in 2022 and 2023 did not meet the incentive conditions, the cost and
expense recognized during current waiting period is RMB -12,462,167.10, and the consolidated
capital reserve is decreased by RMB 11,692,261.51 according to the shareholding ratio of the
subsidiaries.
4. Current share based payment expenses
198
Beijing Shougang Co. Ltd Annual Report 2023
Modification of share-based payment N/A
Termination of share-based payment N/A
XIII. Commitments and contingencies
1. Material commitments
As of 31 December 2023, the Company has no commitments that should be disclosed.
2. Contingencies
As of 31 December 2023, the Company has no pending litigation, external guarantees or other
contingencies that should be disclosed.
XIV Events after balance sheet date
1. Profit distribution after the balance sheet date
Proposed profits or dividends to be distributed 233,838,348.15
Approved profit or dividend declared for
--
distribution
According to the resolution of the 7th meeting of the 8th board of directors on April 18, 2024, the
board of directors proposes that the Company distribute cash dividends to all shareholders based on
the share capital on the equity registration date when the annual equity distribution is implemented
in 2023, and distribute cash dividends of RMB233,838,348.15 (including tax) to all shareholders. If
calculated based on the share capital of 7,794,611,605 shares as of April 18, 2024, which is
RMB0.3 (including tax) per 10 shares, the remaining undistributed profits will be carried forward to
the next year.
If there is a change in the total number of shares of the Company entitled to distribution rights
before the implementation of the distribution plan, based on the principle that the total amount of
cash distribution remains unchanged, the cash dividend per share will be adjusted based on the total
number of shares entitled to distribution rights on the registration date of dividend distribution
equity.
The proposed dividend distribution is yet to be approved by the shareholders' meeting and has not
been recognized as a liability in this financial statement.
2. Explanation of other events after the balance sheet date
As of April 18, 2024, there are no other post balance sheet events that should be disclosed by the
Company.
XV. Other significant events
1. The main content and significant changes of pension plans
In order to ensure and improve the level of benefits for employees after retirement, and to stimulate
their labor enthusiasm, the Company has decided to establish an enterprise pension plan. The
enterprise annuity established by the Company belongs to the defined contribution plan. The
expenses required for raising enterprise annuities shall be jointly borne by the company and
employees. The payment channels for unit contributions shall be implemented in accordance with
199
Beijing Shougang Co. Ltd Annual Report 2023
relevant national regulations, and individual employee contributions shall be withheld and paid by
the company from the employee's salary.
2. Segment information
According to internal organizational structure, management requirement and requirement of internal
reporting system, the Company divides businesses into iron and steel segment. Therefore, there is
no need to present more detailed information on operating segments.
① External revenue of goods and services
Item 2023 2022
Iron and steel 113,761,443,633.43 118,142,183,549.47
② Geographical information
Current period or end of
Mainland China Hong Kong Offset Total
current period
External trading revenue 113,761,182,300.41 1,914,228.76 -1,652,895.74 113,761,443,633.43
Non-current assets 104,990,915,208.22 -- -- 104,990,915,208.22
Continued:
Prior period or end of prior
Mainland China Hong Kong Offset Total
period
External trading revenue 118,142,183,549.47 -- -- 118,142,183,549.47
Non-current assets 108,436,915,079.61 -- -- 108,436,915,079.61
XVI. Notes to the financial statements of parent company
1. Notes receivable
2023.12.31
Item
Book balance Bad debt provision Net carrying value
Bank acceptances -- -- --
Commercial acceptances 826,432,612.58 826,432.61 825,606,179.97
Total 826,432,612.58 826,432.61 825,606,179.97
2022.12.31
Item
Book balance Bad debt provision Net carrying value
Bank acceptances -- -- --
Commercial acceptances 899,539,689.52 899,539.69 898,640,149.83
Total 899,539,689.52 899,539.69 898,640,149.83
(1) Outstanding endorsed or discounted notes that have not matured at the end of the year
Item Amount derecognized as of December 31, 2023 Amount not-derecognized as of December 31, 2023
200
Beijing Shougang Co. Ltd Annual Report 2023
Item Amount derecognized as of December 31, 2023 Amount not-derecognized as of December 31, 2023
Commercial acceptances -- 756,922,960.96
(2) Notes transferred to accounts receivable due to non-performance of the issuers at the end of the
year
Item Amount transferred to accounts receivable as of December 31, 2023
Commercial acceptance notes 2,000,000.00
(3) Classified by bad debt provision method
2023.12.31
Category Book balance Bad debt provision
Net carrying
Expected value
Amount Proportion (%) Amount
credit loss (%)
Assessed bad debt
--
provision individually
Assessed bad debt
provision in portfolios
826,432,612.58 100.00 826,432.61 0.10 825,606,179.97
based on credit risk
characteristics
Portfolio 1 -- -- -- -- --
Portfolio 2 826,432,612.58 100.00 826,432.61 0.10 825,606,179.97
Total 826,432,612.58 100.00 826,432.61 0.10 825,606,179.97
Continued:
2022.12.31
Category Book balance Bad debt provision
Net carrying
Expected value
Amount Proportion (%) Amount
credit loss (%)
Assessed bad debt
-- -- -- -- --
provision individually
Assessed bad debt
provision in portfolios
899,539,689.52 100.00 899,539.69 0.10 898,640,149.83
based on credit risk
characteristics
Group 1 -- -- -- -- --
Group 2 899,539,689.52 100.00 899,539.69 0.10 898,640,149.83
Total 899,539,689.52 100.00 899,539.69 0.10 898,640,149.83
(4) Provision, recovery or reversal of bad debt
Item Bad debt provision
Opening balance 899,539.69
Provision --
Recovery or reversal 73,107.08
201
Beijing Shougang Co. Ltd Annual Report 2023
Item Bad debt provision
Written-off --
Closing balance 826,432.61
(5) The Company has no notes receivable actually written off in reporting period.
2. Accounts receivable
(1) Disclosed by ageing of account receivables
Ageing 2023.12.31 2022.12.31
Within 1 year 1,435,785,435.03 1,398,579,212.14
1 – 2 years -- --
2 – 3 years -- 2,197,756.62
Over 3 years 2,000,000.00 8,578,211.62
Subtotal 1,437,785,435.03 1,409,355,180.38
Less: provision for bad debts 4,457,794.56 12,694,254.85
Total 1,433,327,640.47 1,396,660,925.53
(2) Disclosed by bad debt provision
2023.12.31
Book balance Bad debt provision
Category
Net carrying
Expected
Proportion value
Amount Amount credit loss
(%)
(%)
Assessed bad debt
2,000,000.00 0.14 2,000,000.00 100.00 --
provision individually
Assessed bad debt
provision in portfolios
1,435,785,435.03 99.86 2,457,794.56 0.17 1,433,327,640.47
based on credit risk
characteristics
Portfolio of aging analysis 68,752,409.77 4.78 2,457,794.56 3.57 66,294,615.21
Portfolio of consolidation
1,367,033,025.26 95.08 -- -- 1,367,033,025.26
scope
Total 1,437,785,435.03 100.00 4,457,794.56 0.31 1,433,327,640.47
Continued:
2022.12.31
Book balance Bad debt provision
Category
Net carrying
Expected
Proportion value
Amount Amount credit loss
(%)
(%)
Assessed bad debt
8,578,211.62 0.61 8,578,211.62 100.00 --
provision individually
202
Beijing Shougang Co. Ltd Annual Report 2023
2022.12.31
Book balance Bad debt provision
Category
Net carrying
Expected
Proportion value
Amount Amount credit loss
(%)
(%)
Assessed bad debt
provision in portfolios
1,400,776,968.76 99.39 4,116,043.23 0.29 1,396,660,925.53
based on credit risk
characteristics
Portfolio of aging analysis 71,836,571.46 5.10 4,116,043.23 5.73 67,720,528.23
Portfolio of consolidation
1,328,940,397.30 94.29 -- -- 1,328,940,397.30
scope
Total 1,409,355,180.38 100.00 12,694,254.85 0.90 1,396,660,925.53
Assessed bad debt provision individually：
2023.12.31
Accounts receivable (by
debtor) Expected credit loss Reason for
Book balance Bad debt provision
(%) bad debts
Recourse for overdue
Recourse for overdue bills 2,000,000.00 2,000,000.00 100.00
bills
Continued:
2022.12.31
Accounts receivable (by
debtor) Expected credit loss Reason for
Book balance Bad debt provision
(%) bad debts
Accounts receivable over
6,578,211.62 6,578,211.62 100.00 Long aging
3 years
Recourse for overdue
Recourse for overdue bills 2,000,000.00 2,000,000.00 100.00
bills
Total 8,578,211.62 8,578,211.62 100.00
Assessed bad debt provision in portfolios：
2023.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
Within 1 year 1,435,785,435.03 2,457,794.56 0.17
1 – 2 years -- -- --
2 – 3 years -- -- --
Over 3 years -- -- --
Total 1,435,785,435.03 2,457,794.56 0.17
Continued:
2022.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
Within 1 year 1,398,579,212.14 2,480,070.86 0.18
203
Beijing Shougang Co. Ltd Annual Report 2023
2022.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
1 – 2 years -- -- --
2 – 3 years 2,197,756.62 1,635,972.37 74.44
Over 3 years -- -- --
Total 1,400,776,968.76 4,116,043.23 0.29
(3) Provision, recovery or reversal of bad debt
Item Bad debt provision
Opening balance 12,694,254.85
Provision --
Recovery or reversal 8,236,460.29
Written-off --
Closing balance 4,457,794.56
(4) The Company has no accounts receivable write-off during the reporting period.
(5) The top five accounts receivable classified by debtors are as follows:
During the year, the total amount of the top five accounts receivable collected by debtors at the end
of the period is RMB 1,412,087,165.65, accounting for 98.21% of the total amount of accounts
receivable at the end of the period, and the total amount of the corresponding bad debt provision at
the end of the period is RMB 2,139,000.61.
Closing balance of Closing balance of
Company Name Percentage %
accounts receivable provision
Beijing Shougang Cold Rolling Co., Ltd. 1,327,107,169.50 92.30 --
Qian'an Shoujia Construction Material Co., Ltd. 50,221,363.06 3.49 1,795,337.69
Shougang Zhixin Qian'an Electromagnetic
25,145,277.41 1.75 --
Materials Co., Ltd.
Xinhui CIMC Container Co., Ltd. 6,720,973.91 0.47 240,264.64
Zhangjiagang CIMC Shengdayin Low Temperature
2,892,381.77 0.20 103,398.27
Equipment Co., Ltd.
Total 1,412,087,165.65 98.21 2,139,000.60
3. Financing receivables
Item 2023.12.31 2022.12.31
Notes receivable 823,200,805.55 835,526,685.55
Less：Other comprehensive income - fair value changes -- --
Closing balance of fair value 823,200,805.55 835,526,685.55
(1) Classified by bad debt provision method
204
Beijing Shougang Co. Ltd Annual Report 2023
2023.12.31
Book balance Bad debt provision
Category
Expected Net carrying value
Proportion
Amount Amount credit loss
(%)
(%)
Assessed bad debt provision
-- -- -- -- --
individually
Assessed bad debt provision
in portfolios
823,365,478.65 100.00 164,673.10 0.02 823,200,805.55
based on credit risk
characteristics
Portfolio 1 823,365,478.65 100.00 164,673.10 0.02 823,200,805.55
Portfolio 2 -- -- -- -- --
Total 823,365,478.65 100.00 164,673.10 0.02 823,200,805.55
Continued:
2022.12.31
Book balance Bad debt provision
Category
Expected Net carrying value
Proportion
Amount Amount credit loss
(%)
(%)
Assessed bad debt provision
-- -- -- -- --
individually
Assessed bad debt provision
in portfolios
835,693,824.31 100.00 167,138.76 0.02 835,526,685.55
based on credit risk
characteristics
Portfolio 1 835,693,824.31 100.00 167,138.76 0.02 835,526,685.55
Portfolio 2 -- -- -- -- --
Total 835,693,824.31 100.00 167,138.76 0.02 835,526,685.55
(2) Provision, recovery or reversal of bad debt
Item Bad debt provision
Opening balance 167,138.76
Provision --
Recovery or reversal 2,465.66
Written-off --
Closing balance 164,673.10
(3) The company has no pledged notes receivable at the end of the year
(4) Outstanding endorsed or discounted notes that have not matured at the end of the year
Amount derecognized as of Amount not-derecognized as of
Item
December 31, 2023 December 31, 2023
Bank acceptance notes 6,233,990,659.20 --
205
Beijing Shougang Co. Ltd Annual Report 2023
Amount derecognized as of Amount not-derecognized as of
Item
December 31, 2023 December 31, 2023
Commercial acceptance notes -- --
Total 6,233,990,659.20 --
4. Other receivables
Item 2023.12.31 2022.12.31
Dividends receivable -- 9,713,244.06
Other receivables 136,314,481.16 1,154,281,751.62
Total 136,314,481.16 1,163,994,995.68
(1) Dividends receivable
Item 2023.12.31 2022.12.31
Beijing Shougang New Energy Automobile Material
-- 9,713,244.06
Technology Co., Ltd.
Less: Bad debt provision -- --
Total -- 9,713,244.06
(2) Other receivables
① Disclosed by the ageing of other receivables
Ageing 2023.12.31 2022.12.31
Within 1 year 136,323,182.39 1,154,320,981.69
Less: provision for bad debts 8,701.23 39,230.07
Total 136,314,481.16 1,154,281,751.62
② Disclosed by nature of other receivables
2023.12.31
Item
Book balance Provision for bad debts Carrying value
Petty cash 74,024.55 3,701.23 70,323.32
Deposits 100,000.00 5,000.00 95,000.00
Due from intra-companies 136,149,157.84 -- 136,149,157.84
Total 136,323,182.39 8,701.23 136,314,481.16
Continued:
2022.12.31
Item
Book balance Provision for bad debts Carrying value
Petty cash 282,590.68 14,129.53 268,461.15
206
Beijing Shougang Co. Ltd Annual Report 2023
2022.12.31
Item
Book balance Provision for bad debts Carrying value
Deposits 500,000.00 25,000.00 475,000.00
Due from other companies 2,010.86 100.54 1,910.32
Due from intra-companies 1,153,536,380.15 -- 1,153,536,380.15
Total 1,154,320,981.69 39,230.07 1,154,281,751.62
③ Provision for bad debts
As at 31 December 2023, bad debts provision for Phase I:
Expected credit loss
Carrying
Category Book balance within 12 months Provisions
value
(%)
Assessed bad debt provision
individually
Assessed bad debt provision in
136,323,182.39 0.01 8,701.23 136,314,481.16
portfolios
Petty cash and deposits 174,024.55 5.00 8,701.23 165,323.32
Due from intra-companies 136,149,157.84 -- 136,149,157.84
Total 136,323,182.39 0.01 8,701.23 136,314,481.16
As at 31 December 2023, the Company has no other receivables in Phase II
As at 31 December 2023, the Company has no other receivables in Phase III
As at 31 December 2022, bad debts provision for Phase I:
Expected credit loss
Carrying
Category Book balance within 12 months Provisions
value
(%)
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
1,154,320,981.69 -- 39,230.07 1,154,281,751.62
portfolios
Petty cash and deposits 782,590.68 5.00 39,129.53 743,461.15
Due from other companies 2,010.86 5.00 100.54 1,910.32
Due from intra-companies 1,153,536,380.15 -- -- 1,153,536,380.15
Total 1,154,320,981.69 -- 39,230.07 1,154,281,751.62
As at 31 December 2022, the Company has no other receivables in Phase II
As at 31 December 2022, the Company has no other receivables in Phase III
④ Provision, recovery or reversal of bad debt
Provision for bad debts Phase I Phase II Phase III Total
207
Beijing Shougang Co. Ltd Annual Report 2023
Expected credit loss
Expected credit Expected credit loss
over the lifetime
loss within 12 over the lifetime (no
(credit impairment
months credit impairment)
occurred)
As at 1 January 2023 39,230.07 -- -- 39,230.07
Changes during the year: -- -- -- --
-- Shift to Phase II -- -- -- --
-- Shift to Phase III -- -- -- --
-- Back to Phase II -- -- -- --
-- Back to Phase I -- -- -- --
Provision -- -- -- --
Reversal 30,528.84 -- -- 30,528.84
Converse -- -- -- --
Written-off -- -- -- --
Other movements -- -- -- --
As at 31 December 2023 8,701.23 -- -- 8,701.23
⑤ No write-off of provision for bad debts during the reporting period.
⑥ The top five other receivables classified by debtors are as follows:
Closing
Percentage
Company Name Nature of transaction Closing balance Ageing balance
(%)
of provisions
Shougang Jingtang United Iron & Due from Within 1
136,149,157.84 99.88 --
Steel Co., Ltd. intra-companies year
China Petroleum Materials Company Within 1
Deposits 100,000.00 0.07 5,000.00
Limited year
Within 1
Petty cash Petty cash 74,024.55 0.05 3,701.23
year
Total 136,323,182.39 100.00 8,701.23
5. Long-term equity investments
2023.12.31 2022.12.31
Item Provision for Provision for
Book balance Carrying value Book balance Carrying value
impairment impairment
Investments in
36,163,368,519.93 -- 36,163,368,519.93 36,621,384,419.98 -- 36,621,384,419.98
subsidiaries
Investment in
856,811,320.22 -- 856,811,320.22 1,066,506,040.90 -- 1,066,506,040.90
associates
Total 37,020,179,840.15 -- 37,020,179,840.15 37,687,890,460.88 -- 37,687,890,460.88
(1) Investments in subsidiaries
Impairment
Provision for
Subsidiaries 2023.1.1 Increase Decrease 2023.12.31 at the end of
impairment
the year
208
Beijing Shougang Co. Ltd Annual Report 2023
Impairment
Provision for
Subsidiaries 2023.1.1 Increase Decrease 2023.12.31 at the end of
impairment
the year
Shougang Jingtang United
16,308,208,739.58 -- 5,449,033.64 16,302,759,705.94 -- --
Iron & Steel Co., Ltd.
Beijing Shougang Cold
1,832,315,853.00 -- 142,337.81 1,832,173,515.19 -- --
Rolling Co., Ltd.
Qian'an Shougang
Metallurgical Technology 1,900,000.00 -- -- 1,900,000.00 -- --
Co., Ltd.
Shougang Zhixin Qian'an
Electromagnetic materials 7,486,106,290.71 -- 1,954,794.69 7,484,151,496.02 -- --
Co., Ltd.
Beijing Shougang New
Energy Automobile
450,157,812.20 -- 450,157,812.20 -- -- --
Material Technology Co.,
Ltd.
Beijing Shougang Steel
Trading Investment 10,542,695,724.49 -- 311,921.71 10,542,383,802.78 -- --
Management Co., Ltd.
Total 36,621,384,419.98 -- 458,015,900.05 36,163,368,519.93 -- --
(2) Investments in associates
Changes during the year
Impairment
Associates 2023.1.1 Investment 2023.12.31 at the end of
Other Other the year
income under Cash Provision for
Increase Decrease comprehensive equity Others
the equity dividend impairment
income movement
method
Qian'an Sinochem
Coal Chemical 891,510,510.32 -- -- -218,489,120.70 -- -- -- -- -- 673,021,389.62 --
Industrial Co., Ltd.
Beijing Shouxin
Jinyuan
Management
122,430,402.99 -- -- 84,209,307.09 -- -- 77,539,284.02 -- -- 129,100,426.06 --
Consulting Center
(Limited
Partnership)
Beijing
Dingshengcheng
16,830,558.74 -- -- 4,597,037.20 -- -- -- -- -- 21,427,595.94 --
Packaging
Materials Co., Ltd.
Qian'an Jinyu
Shougang
Environmental
35,734,568.85 -- -- -2,472,660.25 -- -- -- -- -- 33,261,908.60 --
Protection
Technology Co.,
Ltd.
Total 1,066,506,040.90 -- -- -132,155,436.66 -- -- 77,539,284.02 -- -- 856,811,320.22 --
6. Operating revenue and costs of sales
(1) Operating revenue and costs of sale
2023 2022
Item
Revenue Cost of sales Revenue Cost of sales
Main business 37,731,133,730.37 36,510,420,909.92 37,952,493,407.65 37,315,733,518.02
Other business 1,195,172,491.74 1,126,001,960.80 1,052,315,697.44 880,022,135.85
Total 38,926,306,222.11 37,636,422,870.72 39,004,809,105.09 38,195,755,653.87
(2) Operating revenue and operating costs of sale by product
2023 2022
Product type
Revenue Cost of sales Revenue Cost of sales
209
Beijing Shougang Co. Ltd Annual Report 2023
2023 2022
Product type
Revenue Cost of sales Revenue Cost of sales
Main business:
Billet 420,010,787.22 419,214,964.92 546,474,748.00 473,163,072.64
Hot rolled 36,572,541,034.81 35,338,824,605.16 36,748,637,995.88 36,218,585,936.96
Cold rolled 232,556,455.45 200,135,560.77 -- --
Other steel products 506,025,452.89 552,245,779.07 657,380,663.77 623,984,508.42
Subtotal 37,731,133,730.37 36,510,420,909.92 37,952,493,407.65 37,315,733,518.02
Other business:
Power 734,868,775.06 832,154,398.91 603,897,153.58 692,208,727.34
Solid waste 89,176,748.38 82,967,188.13 16,142,266.98 14,549,025.28
Others 371,126,968.30 210,880,373.76 432,276,276.88 173,264,383.23
Subtotal 1,195,172,491.74 1,126,001,960.80 1,052,315,697.44 880,022,135.85
Total 38,926,306,222.11 37,636,422,870.72 39,004,809,105.09 38,195,755,653.87
(3) Breakdown of operating revenue
Item 2023
Main operating revenue 37,731,133,730.37
Including: recognized at a certain point 37,731,133,730.37
Recognized during a certain period of time --
Other revenue 1,195,172,491.74
Total 38,926,306,222.11
7. Investment income
Item 2023 2022
Investment income from long-term investment under cost method 492,295,603.66 230,168,137.37
Investment income from long-term investment under equity method -132,155,436.66 -178,256,786.93
Investment income from disposal of long-term equity investments 96,523,695.89 --
Dividend from other equity instruments investments 7,412,132.80 5,614,882.12
Interest income from entrusted loans 3,951,910.93 1,708,741.16
Total 468,027,906.62 59,234,973.72
XVII. Supplementary information
1. Non-recurring gains or losses
Item 2023 Note
Gains or losses on disposal of non-current assets -22,066,115.49
210
Beijing Shougang Co. Ltd Annual Report 2023
Item 2023 Note
Government grants recognized in profit or loss during reporting period
(excluding those close related to the Company’s normal business,
137,487,616.66
conforming to the national policies and regulations and enjoying
ongoing fixed amount or quantity according to certain standard)
Reversal of impairment provisions for separate impairment testing 33,127,315.83
Gains or losses from external entrusted loans 8,990,991.36
Non-operating income/(expenses) except the above 4,157,902.31
Total non-recurring gains or losses 161,697,710.67
Less: income tax effect on non-recurring gains or losses 21,652,772.59
Net non-recurring gains or losses 140,044,938.08
Less: non-recurring gains or losses attributable to non-controlling
3,962,558.39
interests of the Company (after tax)
Non-recurring gains or losses attributable to shareholders of the
136,082,379.69
Company
2. Return on net assets and earnings per share
Weighted average Earnings per share
Profit of reporting period
return on net assets % Basic Diluted
Net profit/ (loss) attributable to shareholders of the
1.35% 0.0856
company
Net profit/ (loss) attributable to shareholders of the
1.07% 0.0680
Company excluding non-recurring gains or losses
Board of Directors of Beijing Shougang Company Limited
18 April 2024
211
