Beijing Shougang Co. Ltd Annual Report 2022
Beijing Shougang Company Limited
2022 Annual Report
19 April 2023
1
Beijing Shougang Co. Ltd Annual Report 2022
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.
Mr. Zhao Minge, the representative of the Company, Mr. Liu Jianhui, the general manager of the Company, Mr. Li
Baizheng, the person overseeing the accounting operations of the Company, and Ms. Gong Juanjuan, head of
Accounting Department, made representations in respect of the truthfulness, accuracy and completeness of the
financial report contained in the annual report.
Other directors except the following attended the board meeting to consider the annual report in person:
Name of director not present in Title of director not present in Reasons for not attending in
Name of principal
person person person
Li Jiantao Director Other arrangements Zeng Li
Ye Lin Independent director Other arrangements Liu Shen
Forward-looking statements contained in this annual report do not constitute any substantive commitments to
investors by the Company. Investors should be aware of the relevant investment risks.
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 Company plans not to distribute cash dividends, issue bonus shares, or convert public reserve funds into share
capital.
This report is prepared based on Chinese text and is prepared in both Chinese and English versions. In the event of
any discrepancy between Chinese and English versions, the Chinese version shall prevail.
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Beijing Shougang Co. Ltd Annual Report 2022
CONTENTS
SECTION I. IMPORTANT NOTICE, CONTENT, DEFINITIONS .......................................................................................................... 2
SECTION II. COMPANY PROFILE AND MAJOR FINANCIAL INDICATORS ........................................................................................ 6
SECTION III. MANAGEMENT DISCUSSION AND ANALYSIS .......................................................................................................... 9
SECTION IV. CORPORATE GOVERNANCE................................................................................................................................. 35
SECTION V. ENVIRONMENT AND SOCIAL RESPONSIBILITY ...................................................................................................... 52
SECTION VI. SIGNIFICANT EVENTS ........................................................................................................................................ 58
SECTION VII. MOVEMENTS IN SHARE CAPITAL AND SHAREHOLDERS ....................................................................................... 66
SECTION VIII. PREFERRED SHARES ....................................................................................................................................... 74
SECTION IX. BONDS ............................................................................................................................................................. 75
SECTION X. FINANCIAL REPORT ............................................................................................................................................ 79
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Beijing Shougang Co. Ltd Annual Report 2022
File directory for reference
1.Accounting statements with signatures and seals of Chairman, general manager, chief accountant and person in
charge of accounting institution.
2. Original audit report with seals of accounting firm and signature and seals of CPA.
3. All the original documents and announcements publicly disclosed in newspapers designated by China Securities
Regulatory Commission during the reporting period.
4. The Articles of Association of the Company, etc.
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Beijing Shougang Co. Ltd Annual Report 2022
INTERPRETATION
Items Refers to Contents
CSRC Refers to China Securities Regulatory Commission
SZSE Refers to Shenzhen Stock Exchange
Company, the Company or
Refers to Beijing Shougang Company Limited
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%)
Beijing Shougang New Energy Automobile Material Technology Co., Ltd. (Holding
New-E Co. Refers to
subsidiary of the Company, the Company holds 45.9184%)
Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd. (Holding subsidiary of
Zhixin Co. Refers to
the Company, the Company holds 75.3989%, New-E Co. holds 8.9042%)
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 2022 to 31 December 2022
Thousand, Million, Billion Refers to RMB Thousand, RMB Million, RMB Billion
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Beijing Shougang Co. Ltd Annual Report 2022
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 Beijing Shougang Co., Ltd.
Statutory Chinese name of the Company Shougang Co.
Statutory English name of the Company (if any) Beijing Shougang Co., Ltd.
Legal representative of the Company Zhao Minge
Registered address Shijingshan Road, Shijingshan District, Beijing, PRC
Postal code of the registered address 100041
Historical changes in the company's registered
N/A
address
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 Chen Yi
Correspondence address No. 99 Shijingshan Road, Shijingshan District, Beijing, PRC
Telephone 010-88293727
Fax 010-88292055
Email address Chenyi@shougang.com.cn
III. Information disclosure and place for inspection
Website designated by CSRC for annual report publication http://www.szse.cn/
China Securities Journal, Securities Times, Shanghai Securities News,
Designated media for information disclosure
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 any) No changes
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 Qian Bin, Yu Qike
Sponsor engaged by the Company for performing continuous supervision duties in reporting period
√ Applicable □ Non applicable
Name Office address Representatives Supervision period
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Beijing Shougang Co. Ltd Annual Report 2022
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
China 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
2021 2020
last year
2022
Before the After the After the Before the
After the adjustment
adjustment adjustment adjustment adjustment
Operating revenue 118,142,183,549.47 134,034,486,136.13 132,984,304,668.28 -11.16% 79,951,181,948.10 79,307,013,777.86
Net profit attributable to
shareholders of the listed 1,124,540,659.14 7,014,335,009.45 7,106,480,663.26 -84.18% 1,786,452,832.06 1,860,083,009.29
company
Net profit attributable to
shareholders of the listed
1,052,510,876.43 7,014,226,910.72 7,014,226,910.72 -84.99% 1,714,439,720.83 1,714,439,720.83
company after deducting
non-recurring gain and loss
Net cash flows from operating
10,044,235,497.80 15,043,727,257.76 15,393,189,844.23 -34.75% 10,274,678,796.19 10,585,193,889.71
activities
Basic earnings per share 0.1496 1.1291 1.1439 -86.92% 0.3377 0.3517
Diluted earnings per share 0.1496 1.1291 1.1439 -86.92% 0.3377 0.3517
Weighted average return on net Decrease
2.42% 19.07% 19.42% 6.40% 6.66%
assets 17.00%
Changes over
31 December 2021 end 31 December 2020
31 December 2022 of last year
Before the After the After the Before the
After the adjustment
adjustment adjustment adjustment adjustment
Total assets 143,173,445,003.35 147,211,560,696.41 149,442,546,290.82 -4.19% 144,367,221,971.10 146,501,367,231.01
Net assets attributable to
shareholders of the listed 47,947,672,865.42 41,827,745,395.60 41,647,543,198.14 15.13% 28,959,395,268.02 28,779,193,070.56
company
The Company’s net profit before and after deducting non-recurring gain 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
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Beijing Shougang Co. Ltd Annual Report 2022
accounting standards and Chinese Accounting Standards during the reporting period of the Company.
VIII. Major financial indicators by quarter
Unit: RMB Yuan
Q1 Q2 Q3 Q4
Total revenue 31,840,817,169.27 31,990,228,506.28 27,852,802,729.76 26,458,335,144.16
Net profit attributable to
1,053,885,048.28 707,301,393.66 18,365,744.01 -655,011,526.81
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
1,055,880,984.57 696,792,776.64 -4,573,325.97 -695,589,558.81
after deducting non-recurring gain
and loss
Net cash flows from operating
193,292,850.10 2,091,690,719.74 2,958,070,851.39 4,801,181,076.57
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 gain and loss
√ Applicable □ Non applicable
Unit: RMB Yuan
Item 2022 2021 2020 Note
Gains and losses on disposal of non-current assets
(including the write-off that accrued for impairment of -56,974,152.72 -55,726,886.68 -633,491.79
assets)
Government grant included in the current profit and loss
(except for the government grant which are closely
related to the normal operation of the company that
67,816,372.72 48,447,356.52 58,640,213.30
comply with national policies and regulations and
continue to be enjoyed according to certain standards,
quotas, or quotas)
Current net profit and loss of subsidiaries arising from
business combinations under the same control from the 55,404,276.08 92,145,653.81 135,152,229.04
beginning of the period to the combinations date
Profit and loss from external entrusted loans 11,275,389.73 10,518,170.49 10,361,268.74
Other non-operating income and expenses except the
10,369,331.96 1,941,256.62 -289,865.40
above items
Other profit and loss items conforming to the definition
-6,922,580.64
of non-recurring gain and loss
Less: The impact of income tax 7,764,321.72 -950,188.41 7,022,263.80
The impact on non-controlling interests (post-tax) 8,097,113.34 6,021,986.63 43,642,220.99
Total 72,029,782.71 92,253,752.54 145,643,288.46 --
Specific situation of other profit and loss items that meet the definition of non-recurring gain and loss:
□ Applicable √ Non applicable
The Company has no specific situation of other profit and loss items that meet the definition of non-recurring gain and loss.
Explanation of reclassifying the non-recurring gain and loss items listed in the Explanatory Announcement No. 1 on Information
Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss Items as recurring items:
□ Applicable √ Non applicable
The Company has no non-recurring profit and loss item listed in the Explanatory Announcement No. 1 on Information Disclosure for
Companies Offering Their Securities to the Public—Exceptional Gain/Loss Items is reclassied as recurring item.
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Beijing Shougang Co. Ltd Annual Report 2022
Section III. Management Discussion and Analysis
I. The industry situation of the Company during the reporting period
In 2022, due to the turbulence of the international situation, the interest rate hike of the US dollar, and other factors, the demand for
steel market will decline more than expected, the steel price will continue to weaken, the raw fuel price will remain relatively high,
and the industry benefit will decline significantly year-on-year. At present, the contradiction between supply and demand in the iron
and steel industry is prominent, showing the characteristics of higher output, higher inventory, higher cost and low demand, low price
and low profit "three high and three low". Steel prices remain sluggish in the second half of the year, resulting in a large proportion of
losses in the steel industry.
In 2022, CISA key statistics member iron and steel enterprises achieved operating revenue of RMB6,587.5 billion, down by 6.35%
year on year, and total profit of RMB98.2 billion, down by 72.27% year on year. Affected by the policy of dual control of production
capacity and output and downstream demand, China's cumulative production of pig iron in 2022 was 864 million tons, down by
0.80% year on year, 1.018 billion tons of crude steel with a year on year decrease of 1.7%, and 1.340 billion tons of steel whith a year
on year increase of 0.22%.
During the reporting period, the Ministry of Industry and Information Technology and other three ministries and commissions jointly
issued the Guiding Opinions on Promoting the High-quality Development of the Iron and Steel Industry, and The State Council
issued the Outline of the Strategic Plan for Expanding Domestic Demand (2022-2035). The two documents pointed out the direction
for the high-quality development of the iron and steel industry, and the enterprises in the industry will continue to develop in the
direction of high-end, intelligent and green.
In 2022, China's electrical steel industry will develop healthily, with the output of oriented electrical steel about 2.17 million tons and
non-oriented electrical steel about 10.92 million tons, making it the world's largest electrical steel producer. The use of high-grade
materials such as energy-saving transformers and driving motors for new energy vehicles has increased significantly, and high-end
electrical steel products have provided strong support for the implementation of the national "dual carbon" policy, the upgrading of
the manufacturing industry and the development of the power industry.
II. Main business of the Company during the reporting period
The main business of the Company is the production and sales of steel products and metal soft magnetic materials (electrical steel)
1. Zhixin Co.
Electric steel is an indispensable electromagnetic material in the fields of power, electronics and military industry. It is the core soft
magnetic functional material applied in the power industry and serves the generation, transmission and use of electric energy. Electric
steel is divided into oriented electric steel and non-oriented electric steel. Oriented electric steel is mainly used in the field of
ultra-high voltage, ultra-high voltage and high energy efficiency distribution transformers. It is used to manufacture transformer cores.
Non-oriented electric steel is mainly used in new energy vehicles, household appliances, industrial motors, small and medium-sized
motors and other industries or fields, used to manufacture motors, frequency conversion compressors and other products.
Zhixin Co is a research and development, manufacturing and sales base of metallic soft magnetic materials (electric steel), and has
become the world's leading manufacturer and service provider of electric steel. Products include oriented electric steel and electric
steel without orientation two big series, oriented electric steel including high magnetic induction, magnetic domain refinement, low
noise, low excitation, no underlying, intermediate frequency six products, independent research and development of low temperature
slab reheating technics producing high magnetic induction orientation technology of electric steel, as the world's fourth all cryogenic
technology industrialization enterprises. Non-oriented electric steel includes four categories of products including new energy
vehicles, stress relief annealing, high efficiency and general, with stable batch production capacity of all grades。
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, 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,
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. Market-leading technology
The Company, Jingtang Co., Zhixin Co., Cold-R Co. are high-tech enterprises, R&D investment of RMB5.386 billion in 2022,
accounts for 4.56% of the operating revenue. Technological innovation is guided by benefit and demand, relying on the research and
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Beijing Shougang Co. Ltd Annual Report 2022
development system of "one institute and multiple centers", making technical research projects, expert workstations and platforms for
external cooperation. The cultivation of new products, new technologies and new technological processes is accelerating.
New Product development: 20SW1200H and ESW1230 are the first electrical steels for new energy vehicles in the world, which
surpass the performance of conventional electrical steels and can greatly improve the power density and efficiency of motors. Five
products, represented by HJAC980B2M with high respreading and ultra-high strength and S100VD with high fatigue performance
steel for compressor valve plate, were first launched in China. 16 high-end materials represented by automobile outer plate 490+Z
and automobile stabilizer bar steel 34MnB5 have been replaced by localization and supplied in batches.
Key technological breakthroughs: The "large proportion pellet iron making technology" of blast furnace with obvious carbon
reduction effect in China can be assembled up to 65% in pellet ore.
Patents: The Company has obtained 654 patents, including 166 invention patents and 488 utility model patents. Two patents "A
method and system of electricity, heat and water co-generation" and "R&D and Application of unmanned operation of pellet
intelligent control" won gold awards at the 121th International Exhibition of Inventions in Paris.
Standards: The Company establishes the standardization industry benchmark, participates in the formulation of 46 standards at all
levels, among which, 22 standards are the lead formulation. Cold-rolled Oriented Electrical Steel Belt won the title of "Leader" of
national Enterprise Standards in 2022.
Science and technology awards: The company has won 5 science and technology awards above the provincial and ministerial level
(the first enterprise to complete), 18 provincial management innovation awards, among which "the construction and practice of
efficient collaborative steel whole process manufacturing control system" won the first prize of metallurgical enterprise management
innovation. Deng Zhenyue of iron making Operation Department of the company won the front-line worker Award of Metallurgical
Science and Technology Award of China Steel Association and China Metal Society for his innovative achievements of "Research
and Application of Stable and long life Technology of blast furnace top Equipment".
2. High-end products
The Company's three strategic products adhere to the development strategy of continuous leadership of electrical steel, refinement
and strength of automobile plate, and high-end breakthrough of tin plate, and continusly to optimize the product structure, production
line structure and customer structure, and achieve the double improvement of product quality and benefit. During the reporting period,
the output of three strategic products (electrical steel, automotive plate, tin (chromium) plate) totaled 5.71 million tons, the output of
eight types of key products (cold-rolled special steel, hot-rolled pickling plate, climate resistant steel, energy steel, automotive
structural steel, high-strength construction machinery steel, pipeline steel, bridge steel) totaled 8.19 million tons, and the total output
of strategic and key products was 13.9 million tons. The above products account for 63% of the company's total steel output.
The output of electrical steel reached 1.48 million tons, with the proportion of high-end products steadily increasing. With the
promotion of the national "dual carbon" strategy, the electrification level of the whole society is further improved, and the demand
for high-end electrical steel products continues to grow. The company's high-end electrical steel products account for 63%, which is
15% higher than last year.
In terms of high magnetic susceptibility orientation electrical steel, the output of 0.20mm and below ultra-thin specifications high
magnetic susceptibility orientation electrical steel products reached 70,000 tons, with a year-on-year growth of about 30%, achieving
the first domestic sales for five consecutive years. The product structure of non-oriented electrical steel continued to be optimized,
and the output of high-grade non-oriented electrical steel products was 728,000 tons, up 33% year on year, among which the output
of high-grade non-oriented electrical steel products for new energy vehicles increased 144% year on year. The stable supply of 7 of
the top 10 global sales of new energy vehicles was achieved by all the top 10 domestic sales.
The output of automobile board was 3.61 million tons, up nearly 2% year on year, and new breakthroughs were made in product and
channel structure adjustment. The product mix was further optimized, with the output of galvanized, high-strength and outer plate
increasing by 5%, 23% and 7% year-on-year respectively. Ultra-high strength and aluminized silicon products increased by 80% and
54% year-on-year respectively. The company is the second enterprise in the world to pass the GA product certification of 980MPa
and above of a Japanese automobile enterprise. Zinc-aluminum-magnesium coating products are used in batches for automobile side
cladding. UF steel domestic first and realize batch supply. The user structure was further optimized, and the share of core oems was
stable and rising. The supply of Japanese customers increased by more than 80% year on year, while the supply of joint venture
brand customers increased by 28% year on year.
The output of tin-plated (chrome) plates was 620,000 tons, and the proportion of high-end products further increased. The Company
bulk supply domestic leading enterprises this product for milk powder cans. The Company has batch supply of deep drawing cupping
DI materials for export to the world's largest metal packaging enterprises. The Company's DR Material has achieved 0.14mm
ultra-thin specifications of mass production. The Company has successfully trial-produced chromium-free passivated high-end tin
plate, the corrosion resistance of this material far exceeds similar chromium-containing products. The Company's "wing steel"
products appeared in the Beijing Winter Olympics and the 20th CPC National Congress.
The Company attaches great importance to the product characteristics, differentiation, and in this respect to make new progress. The
company's 9Ni steel for Marine LNG fuel tanks and LPG Marine container steel products achieve batch supply. The Company
became the first domestic high-steel grade hydrogen transmission pipeline steel mass production, and the product supplied the first
domestic long-distance, high-pressure hydrogen doped pipeline project. The Company's high strength hydropower steel for the first
batch supply of Ninghai pumped storage hydropower project.
3. Green and low-carbon
The Company takes the lead in achieving ultra-low emissions in the whole process and is the first enterprise in the world to achieve
ultra-low emissions in the whole process, making ultra-low emissions in the steel industry possible. The Company actively leads and
participates in the formulation of green product design standards and green production evaluation standards for iron and steel,
integrates advanced technical indicators and green manufacturing concepts into industry standards, and guides the high-quality
development of enterprises.
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Beijing Shougang Co. Ltd Annual Report 2022
Qiangang Co. and Jingtang Co. continue to maintain the "Grade A" enterprises in environmental protection performance evaluation
of Hebei Province, and take independent emission reduction measures in accordance with policy requirements; Qian Steel Company
promotes ultra-low emission advanced technology and management experience, and has helped nearly 50 iron and steel enterprises
improve their environmental performance. The Company has steadily promoted the construction of LCA system, and the EPD
platform of hot rolled products in the steel industry has been successfully released. The columns of CCTV's "Morning News" and
"Focus Interview" have focused on Shougang Co., which fully affirmed the road of green manufacturing and low-carbon
development of Shougang Co.
The Company has been awarded the title of national "Industrial Product Green Design Demonstration Enterprise", awarded the label
of "double carbon Best Practice Energy Efficiency Benchmark Demonstration Plant Cultivation Enterprise" by China Iron and Steel
Association, and awarded the "2022 Industrial Wastewater Recycling Pilot Enterprise" by the Ministry of Industry and Information
Technology. Five types of products, including cold-rolled high-strength steel plate and steel belt for automobiles and oriented
electrical steel, have been awarded the green design products of the Ministry of Industry and Information Technology.
4. Intelligent manufacturing
New progress was made in intelligent development. The company has built a cross-regional, multi-base and unified production and
marketing integration collaborative management platform, and the evaluation level of the integration of information and
industrialization has generally reached the "innovation breakthrough stage". The digital rate of the company's production equipment
is more than 90%, the amount of "one-click control" process has reached 50, 129 sets of "industrial robots" have been applied, and 15
unmanned intelligent warehouse areas have been built. During the reporting period, 11 sub-projects including 55 use cases of the first
phase of Lighthouse Factory of cold rolling Company were all put into operation. The monthly closed volume of automobile plate
products decreased by about 1000 tons, the monthly turnover days of cold rolling inventory decreased by 1 day, and the service
response time increased from days to minutes. Jingtang Company was awarded the "2022 Intelligent Manufacturing Demonstration
Plant" by four departments including the Ministry of Industry and Information Technology. Shougang's quality digital solution was
rated as an excellent case by the Science and Technology Department of the Ministry of Industry and Information Technology and
China Steel Association, and the company's digital application practice won the "Best Industry Application Award" and "Silver
Award of China Data Productivity Competition" respectively.
5. Supply chain security
The company is the only platform for the development and integration of iron and steel and upstream iron ore resources industry of
Shougang Group, the controlling shareholder, in China, and the supply of iron ore, coke and coal resources for production is
guaranteed. In terms of iron ore, Shousteel Group owns Shuichang Iron Mine and Xingshan Iron Mine with an annual production
capacity of 4 million tons of iron refined powder in China, Peru iron mine with an annual production capacity of 20 million tons of
iron refined powder held abroad, and Macheng Iron mine under construction with high reserves, low cost, environmentally friendly
and efficient transportation, with an annual production capacity of 7 million tons of iron refined powder, which is expected to be
partly put into operation by the end of 2023. The company's iron ore resources security ability will be further improved. In terms of
coke, the coke of Qian Steel Company is mainly supplied by Qian 'an Zhonghua Coal Chemical Co., LTD., a joint venture between
Shougang Company and Kailuan Company, while the coke of Jingtang Company is supplied by Tangshan Shougang Jingtang Xishan
Coking Co., LTD., a joint venture between Jingtang Company and Shanxi Coking Coal, so the supply of coke resources is
guaranteed. In terms of coal, the company has signed a long-term agreement with large state-owned coal groups for resources.
Shougang Fushan Resources Group Co., LTD., in which Shougang Group is a shareholder, also provides part of high-quality coking
coal resources to the company, with 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,
64 EVI projects were promoted, EVI supply quantity increased by more than 20% year on year, and the share of new car contracting
obtained by automobile board increased by more than 60% 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.
The Company has formed a centralized, unified, rapid response and efficient operation of marketing management network with
marketing center as the core, 5 regional steel trade subsidiaries and 11 processing centers and has effectively guaranteed the
production stability of downstream customers and consolidated and improved the channel structure combining leading enterprises in
the industrial chain with high-quality small and medium-sized customers. Shenyang Shougang Steel Processing and Distribution Co.,
Ltd. was awarded the "Excellent service provider" of a customer's logistics workshop. By cultivating the comparative advantages of
industrial chain cooperation, the Company carries out all-round, multi-level and high-quality cooperation with key customers in the
industry, which further enhances the depth of cooperation and improves the viscosity of cooperation, which stabilizes the company's
position in the market.
7. Talent thriving enterprise
The company further promotes the strategy of strengthening the enterprise with talents and builds a multi-level training system for all
staff. Move the normal production line and Zhixin electromagnetic establish the career development system of the whole life cycle of
"voyage" for high-potential talents, hold deep blue special training camp and Azure Blue youth training camp to strengthen talent
empowerment. Jingtang Company has built a "four horizontal and three vertical" training system for all staff, steadily promoted the
"Qinglan Project", and built a platform for cadre improvement and talent growth. During the reporting period, 1 employee was
awarded the Capital Labor Medal, 1 employee was awarded the top ten annual list of "2022 Beijing Model", 3 employees were
awarded the "Capital Citizen Learning Star", 4 employees were awarded the "Post Expert" in the national mechanical metallurgy and
building materials industry, and 4 employees were awarded the Shougang Scientist.
11
Beijing Shougang Co. Ltd Annual Report 2022
The Company improves the talent promotion and evaluation mechanism to smooth the career development path of talents. The
Company strengthens performance orientation and practical orientation, and refines the vertical development performance evaluation
mechanism of the three talent teams of operation and management, professional technology and skill operation, which opens up the
channel of horizontal flow of different sequences of talents. By strengthening the training and development of high-level personnel,
the proportion of high-tech and highly skilled personnel in the Company has steadily increased in recent years.
IV. Analysis of principal business
1. Overview
In 2022, centering on laying a solid foundation for high-quality development, the Company will actively respond to many difficulties
such as stricter environmental protection of major national events and limited logistics, and actively resolve the adverse impact of the
market through the implementation of "environmental protection improvement, structural optimization, cost reduction and efficiency
improvement, capital control and standard improvement". However, affected by the overall market environment, the company's
operating performance during the reporting period still showed a significant year-on-year decrease.
The achievement of major accounting data and financial indicators:
Operating revenue is RMB118.142 billion (11.16% year on year decrease); total profit is RMB1.793 billion (81.90% year on year
decrease); net profit attributable to shareholders of the listed company is RMB1.125 billion (84.18% year on year decrease); EPS is
RMB0.15 (86.92% year on year decrease); total asset is RMB143.173 billion; equity attributable to shareholders of the listed
company is RMB 47.948 billion.
The achievement of major products:
(1) Metallic soft magnetic material (Electric steel)
Zhixin Co.：Electric steel 1.485 million tons, 1.0% year on year decrease, of which the output of non-oriented electric steel is 1.279
million tons, 2.2% year on year decrease, of which the output of oriented electric steel is 206,000 tons, 6.8% year on year increase.
Metal soft magnetic materials sales revenue of RMB 13.401 billion, accounts for 11.34 % of the Company's operating income.
(2) Iron and steel products
Qiangang Co.: Iron 8.122 million tons, (1.5% year on year increase); steel 8.457 million tons (0.4% year on year decrease); material
8.109 million tons (including Cold rolling raw material), 1.3% year on year decrease.
Jingtang Co.: Iron 14.096 million tons (1.3% year on year increase); steel 14.77 million tons (3% year on year decrease); material
14.307 million tons (0.2% year on year decrease).
Cold-R Co.: Cold-rolled plate 1.839million tons (9.3% year on year decrease).
Iron and steel products sales revenue RMB 101.202 billion, accounts for 85.66% of the Company's operating revenue.
2. Revenue and cost
(1) Composition of operating revenue
Unit：RMB Yuan
2022 2021
Year-on-year
Proportion of operating Proportion of operating Changes
Amount Amount
revenue revenue
Total operating revenue 118,142,183,549.47 100% 132,984,304,668.28 100% -11.16%
According to industries
Metallurgy 118,142,183,549.47 100.00% 132,984,304,668.28 100.00% -11.16%
According to products
Billet 546,474,748.00 0.46% 577,251,931.16 0.43% -5.33%
Hot-rolled steel 48,304,009,189.85 40.89% 55,678,740,307.61 41.86% -13.25%
Cold-rolled steel 50,168,306,781.05 42.46% 56,592,919,705.57 42.56% -11.35%
Metallic soft magnetic
13,401,000,073.28 11.34% 13,307,346,567.78 10.01% 0.70%
material
Other steels 2,182,776,642.12 1.85% 3,159,205,203.29 2.38% -30.91%
Other businesses 3,539,616,115.17 3.00% 3,668,840,952.87 2.76% -3.52%
According to regions
North China 45,126,988,057.24 38.20% 48,802,241,326.04 36.71% -7.53%
Northeast China 2,585,270,587.07 2.19% 4,123,150,971.76 3.10% -37.30%
East China 40,848,885,782.99 34.58% 49,632,951,146.49 37.32% -17.70%
Mid-South China 3,246,213,129.88 2.75% 2,623,070,863.28 1.97% 23.76%
South China 15,338,953,399.84 12.98% 19,205,674,818.92 14.44% -20.13%
Southwest China 2,048,028,590.12 1.73% 1,608,695,620.53 1.21% 27.31%
Northwest China 1,256,111,815.93 1.06% 786,965,070.05 0.59% 59.61%
12
Beijing Shougang Co. Ltd Annual Report 2022
Export 7,691,732,186.40 6.51% 6,201,554,851.21 4.66% 24.03%
Distribution model
Direct selling 110,450,451,363.07 93.49% 126,782,749,817.07 95.34% -12.88%
Sale by proxy 7,691,732,186.40 6.51% 6,201,554,851.21 4.66% 24.03%
(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 114,602,567,434.30 108,013,843,862.04 5.75% -11.38% -5.72% -5.66%
According to products
Billet 546,474,748.00 473,163,072.64 13.42% -5.33% -10.66% 5.17%
Hot-rolled steel 48,304,009,189.85 46,623,686,161.87 3.48% -13.25% -5.12% -8.27%
Cold-rolled steel 50,168,306,781.05 47,165,512,678.21 5.99% -11.35% -6.88% -4.51%
Metallic soft
13,401,000,073.28 11,852,098,130.92 11.56% 0.70% 2.04% -1.16%
magnetic material
Other steels 2,182,776,642.12 1,899,383,818.40 12.98% -30.91% -27.89% -3.65%
According to regions
North China 41,587,371,942.07 39,895,374,706.20 4.07% -7.86% -2.56% -5.21%
Northeast China 2,585,270,587.07 2,327,747,756.40 9.96% -37.30% -32.92% -5.88%
East China 40,848,885,782.99 38,501,245,807.59 5.75% -17.70% -11.33% -6.76%
Mid-South China 3,246,213,129.88 2,920,739,182.48 10.03% 23.76% 25.53% -1.27%
South China 15,338,953,399.84 14,792,037,695.12 3.57% -20.13% -11.25% -9.65%
Southwest China 2,048,028,590.12 1,803,747,281.66 11.93% 27.31% 27.39% -0.05%
Northwest China 1,256,111,815.93 1,087,317,561.84 13.44% 59.61% 52.15% 4.25%
Export 7,691,732,186.40 6,685,633,870.75 13.08% 24.03% 19.30% 3.45%
Distribution model
Direct selling 106,910,835,247.90 101,328,209,991.29 5.22% -13.24% -7.21% -6.16%
Sale by proxy 7,691,732,186.40 6,685,633,870.75 13.08% 24.03% 19.30% 3.45%
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 2022 2021 Year-on-year change
Sales Ton 22,066,038.00 22,288,362.00 -1.00%
Metallurgy Output Ton 22,175,618.00 22,316,080.00 -0.63%
Storage Ton 1,007,071.00 897,490.00 12.21%
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
13
Beijing Shougang Co. Ltd Annual Report 2022
2022 2021
Year-on-year
Industry Item Proportion of Proportion of
Amount Amount change
costs of sales costs of sales
Metallurgy Raw materials 56,640,251,091.58 52.44% 66,316,924,003.84 57.88% -5.44%
Metallurgy Fuels 31,007,832,547.47 28.71% 25,364,248,318.11 22.14% 6.57%
Metallurgy Power cost 1,825,623,929.41 1.69% 1,840,911,083.84 1.61% 0.08%
Metallurgy Staff cost 3,111,375,214.85 2.88% 3,271,961,950.60 2.86% 0.02%
Metallurgy Depreciation 7,279,948,522.16 6.74% 7,057,100,771.85 6.16% 0.58%
Manufacturing
Metallurgy 8,148,812,556.57 7.54% 10,712,885,107.17 9.35% -1.81%
cost
Total 108,013,843,862.04 100.00% 114,564,031,235.41 100.00% 0.00%
(6) Whether the scope of consolidation changes during the reporting period
√ Yes □ No
Please refer to the relevant contents of Section X. "VI. Change in the scope of consolidation" 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) 8,806,467,982.21
Proportion of total sales for the top 5 clients in total annual sales 7.46%
Proportion of the sales from related parties in total annual sales among the top five clients 4.10%
Information for top five clients of the Company
Serial Name Sales (RMB Yuan) Proportion of total annual sales
1 Client A 2,901,632,590.54 2.46%
2 Client B 1,942,972,468.05 1.64%
3 Client C 1,638,110,305.32 1.39%
4 Client D 1,227,858,153.88 1.04%
5 Client E 1,095,894,464.42 0.93%
Total -- 8,806,467,982.21 7.46%
Other information for the major customers of the Company
□ Applicable √ Non applicable
Major suppliers
Total purchase amount from top five suppliers (RMB) 80,085,970,883.14
Proportion of total annual purchase amount for top five suppliers 69.18%
Proportion of the purchase from related parties in total annual purchase among the top five suppliers 65.56%
Information for the top five suppliers of the Company
Serial Name Procurement (RMB Yuan) Proportion of total annual procurement
1 Shougang Group Co., Ltd. 49,689,484,312.24 42.92%
2 Supplier B 18,806,466,418.30 16.25%
3 Supplier C 7,398,085,463.60 6.39%
4 Supplier D 2,874,135,975.51 2.48%
5 Supplier E 1,317,798,713.49 1.14%
Total -- 80,085,970,883.14 69.18%
Other information for the major suppliers of the Company
□ Applicable √ Non applicable
3. Expenses
Unit: RMB Yuan
14
Beijing Shougang Co. Ltd Annual Report 2022
2022 2021 Year-on-year change Notes of material changes
Selling expenses 237,997,026.22 213,309,534.38 11.57%
Administrative expenses 1,271,175,739.06 1,301,197,936.20 -2.31%
Finance expenses 1,731,584,291.35 2,260,406,032.80 -23.39%
Research and development
626,923,257.36 652,926,385.56 -3.98%
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
Sintering process is the process
The implementation of the project
with the largest air pollution
provides theoretical support for similar
Co-treatment emissions in the iron and steel
flue gas treatment, will also open up new
technology of CO industry, and its NOx emissions Develop new
ideas for the sustainable emission
and NOx can account for 50% of the total Pilot scale technology, new
reduction of CO and NOx in the steel
multi-pollutants in emissions of iron and steel process
process, and provide technical reserves
sintering flue gas enterprises, so the treatment of
for the green upgrading of the steel
sintering flue gas NOx is
industry in the 14th Five-Year Plan
imminent.
The carbon emissions of China's
iron and steel industry account
for about 18% of the national
The metallurgical reduction process is
carbon emissions, and the total
dominated by hydrogen, and the carbon
energy consumption accounts for
content in the flue gas discharged is also
Basic research on about 15% of China's total Develop new
greatly reduced to achieve the effect of
rotary kiln hydrogen energy consumption. Among Pilot scale technology, new
energy saving and emission reduction,
metallurgy them, the carbon emissions process
which is in line with the dual carbon
mainly come from the iron
policy of "carbon peak and carbon
making process, and 70% of the
emission reduction" in China.
energy consumption is
concentrated in the iron making
process.
The surface temperature and
solidification end point of the
casting billet can be maintained Improve the familiarity with continuous
within the preset range through casting machine, deeply understand the
Research on
the control of two cold water and Develop new influence of continuous casting machine
optimization
pulling speed, and the defects Pilot scale technology, new parameters on product quality, enhance
technology of slab
such as internal crack, corner process quality control ability, improve product
cooling system
crack, bulge, rhomboidal quality, and further enhance the market
deformation and central competitiveness of enterprises.
segregation of the casting billet
can be improved.
Improve the central segregation
of coiled tubing slab, reduce the
sum of inclusions, ribbon
organization and transverse
temperature difference control,
Research on key improve the comprehensive
Develop new Improve the profitability of enterprises by
control technology performance of coiled tubing
Pilot scale technology, new developing high and fine end products
of coiled tubing slab, enhance the ability to
process and new differentiated products.
production receive orders, expand the
competitiveness and brand effect
of Shougang products in the
international market, and
constantly expand the market
share.
This project is dedicated to the
Development of YS development of a high strength It is conducive to adjusting product
series products with and low iron loss non-oriented Develop new structure, improving technology leading
Pilot scale
low iron loss for electrical steel product suitable product edge, expanding market share and
new energy vehicles for the rotor of high speed drive enhancing brand image
motor for new energy vehicles.
15
Beijing Shougang Co. Ltd Annual Report 2022
Narrow the gap between the
production and application of
Key technology and
automotive steel in Hebei
application Develop Jipa grade advanced automotive
province and the level of
demonstration of high-strength steel, realize the
advanced foreign enterprises, and Develop new
high strength steel Finished development of high-quality automotive
realize the substantial product
for advanced steel, enhance the core competitiveness of
improvement of the supply
automobile of Jipa the enterprise
capacity of advanced
grade
high-strength steel varieties of
Jipa grade for automotive.
The drive axle housing is one of
the important parts of medium
and heavy commercial vehicles.
Research and
With the progress of material The development of lightweight
development of
technology and the requirement high-strength bridge housing steel, while
mechanical Develop new
of lightweight, the mechanical Finished meeting the needs of the market and
expansion axle product
expansion axle housing has been users, reduces the cost, and becomes the
housing steel in hot
gradually promoted at present. first product of Shougang Group.
rolling line
The development of mechanical
expansion axle housing steel can
meet the market demand.
0.5 and 11.2 To solve the domestic market
Improve the corrosion resistance of
Coating Study on sales of tin plating less than
Develop new extremely low tin-plated plates to meet
uniformity and 1.1g/m2 of low tin products, can
Finished technology, new customer needs and enhance the core
corrosion resistance not meet the market requirements
process competitiveness of enterprises in
of tin layer of tin of very low tin plate corrosion
tin-plated products.
plate resistance.
The strengthening mechanism
Study on and control process of high It will help enrich Shougang's metal
strengthening nitrogen strength tin plate are packaging steel products, improve
Develop new
mechanism and studied to provide strong Shougang's high-strength tin plate
Finished technology, new
control technology theoretical and technical support production technology level, and fill part
process
of high nitrogen for the research and development of the gap in the domestic market, and
plated tin plate of high nitrogen strength tin plate achieve industry leadership
products.
Form the company's unique thin
Optimization of In order to improve the specification plate shape control core
Develop new
rolling rhythm and performance, size and yield of technology and intelligent production
Finished technology, new
shape control of plate, the problem of plate shape rhythm control core technology, greatly
process
Jingtang Plate control is solved. improve Shougang intelligent level and
market competitiveness.
Complete
Provide strip production line project
Research and The shutdown control of strip production
control system, to solve the approval and
application of strip Develop new line is realized, and the efficiency of
related technology in the strip demand
production line process shutdown of strip production line is
production line shutdown, low analysis,
control technology improved.
efficiency of technical problems. complete
scheme design
Complete
Research and The control method of strip in project
application of cold rolling process is provided approval and Effectively solve the strip deviation,
Develop new
control technology to prevent strip deviation and demand greatly improve the strip surface quality,
process
in strip cold rolling improve the stability of analysis, reduce the quality loss.
process production line. complete
scheme design
1. Complete
the overall
Study and
Development and development planning and
application of high While improving the safety performance
of high strength, good design of the Develop new
strength steel of automobiles, it can increase the sales
formability of stamping steel project. process, new
containing income of enterprises and improve the
plate, with excellent molding 2. Consult product
phosphorus and its economic benefits of enterprises.
performance and surface quality. relevant
preparation method
technical
information.
2. Refer to relevant
technical materials
16
Beijing Shougang Co. Ltd Annual Report 2022
1. Complete
the overall
Research and To solve the existing acid rolling
planning and
application of acid process barrier, improve the It can solve the existing technical
design of the
rolling for mechanical properties of TRIP Develop new problems and realize industrial
project.
producing 600MPa steel, so as to produce the process production, which can bring considerable
2. Consult
grade and 700MPa strength of 600MPa and 700MPa economic benefits.
relevant
grade TRIP steel TRIP steel.
technical
information.
2. Refer to relevant
technical materials
Produce materials with high
Steel for automobile strength, high elongation, good Process
Develop new Accelerate product structure adjustment,
construction and weldability and other curing, batch
process, new improve product performance, increase
production method characteristics, improve impact trial
product sales revenue.
thereof safety and meet the needs of production
lightweight.
Complete the corrosion It is conducive to make up for the
Research and resistance research of the coating shortcomings of Shougang electrical steel
development of under high temperature and high Develop new in coating, narrow the gap with advanced
high tension coating humidity environment, and put Finished technology, new enterprises in the surface quality of
for oriented silicon forward the improvement plan to process electrical steel, and improve the
steel improve the corrosion resistance application capacity of Shougang
of the steel strip surface. electrical steel.
The influence of inclusion
Study on the characteristics (quantity, type, It is beneficial to explore the evolution
influence of size and distribution) in smelting law of inclusion under different
different process is not clear, and the deoxidization processes, determine the
Develop new
deoxidation process influence of different deoxidation deoxidization process and deoxidization
Pilot scale technology, new
on inclusions and processes on slag composition conditions of inclusion in stable control
process
slag system of and slag adsorption capacity has oriented steels, and to meet the growing
oriented silicon not been studied, so it is high quality requirements of oriented
steel necessary to carry out research electrical steels.
and technology accumulation.
This project is dedicated to the
Development of YS development of a high strength It is conducive to adjusting the product
series products with and low iron loss non-oriented Develop new structure, improving the leading edge of
Pilot scale
low iron loss for electrical steel product suitable product technology, expanding the market share,
new energy vehicles for the rotor of high speed drive and enhancing the brand image.
motor for new energy vehicles.
Research on
processing Research 0.15mm material
Develop new To meet the needs of more customers,
technology of processing, cutting, stamping,
Lab scale technology, new conducive to market development,
0.15mm unoriented core production and other
process improve the visibility of enterprises.
silicon steel thin processing technology.
strip core
Through the project
development, the formation
mechanism of the primary
recrystaling tissue was clarified,
the influence law of the rapid
induction heating process on the
Effect of rapid
texture of the primary It is beneficial to improve product
induction heating on Develop new
recrystaling tissue was obtained, quality, improve quality and efficiency,
the texture of Lab scale technology, new
and the influence law of the rapid and enhance the market competitiveness
oriented silicon process
induction heating process on the of oriented silicon steel.
steel
texture and properties of the
secondary recrystaling tissue was
obtained by analyzing the
structural characteristics of the
finished product and the
secondary recrystaling process.
Research and development investment
2022 2021 Proportion of changes
Number of R&D staff 2,342 2,295 2.05%
17
Beijing Shougang Co. Ltd Annual Report 2022
Proportion of R&D staff 12.59% 12.86% -0.27%
Educational background of R&D personnel
Bachelor’s degree 1,212 1,179 2.80%
Master’s degree 670 662 1.21%
Age structure of R&D personnel
Below 30 105 111 -5.41%
30~40 1,273 1,348 -5.56%
Details about R&D investments:
2022 2021 Proportion of changes
R&D investments (RMB Yuan) 5,386,070,865.84 5,321,486,664.95 1.21%
R&D investments as % of operating
4.56% 4.00% 0.56%
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 2022 2021 Year-on-year changes
Cash inflow from operating activities 61,124,110,070.62 78,330,821,588.46 -21.97%
Cash outflow from operating activities 51,079,874,572.82 62,937,631,744.23 -18.84%
Net cash flow from operating activities 10,044,235,497.80 15,393,189,844.23 -34.75%
Cash inflow from investing activities 266,430,661.79 599,102,178.51 -55.53%
Cash outflow from investing activities 3,428,494,466.51 3,683,994,609.78 -6.94%
Net cash flow from investing activities -3,162,063,804.72 -3,084,892,431.27 -2.50%
Cash inflow from financing activities 36,440,713,251.59 33,854,046,954.17 7.64%
Cash outflow from financing activities 43,529,541,314.07 42,586,386,910.41 2.21%
Net cash flow from financing activities -7,088,828,062.48 -8,732,339,956.24 18.82%
Net increase in cash and cash equivalents -206,656,369.40 3,575,957,456.72 -105.78%
Main reasons for significant year-on-year changes in relevant data
√ Applicable □ Non applicable
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.
The decrease in cash inflow from investment activities is mainly due to the decrease in cash received from disposal of investments
and cash received from investment income.
The decrease in the net increase in cash and cash equivalents is mainly due to the decrease in net cash flow from operating activities.
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 from operating activities is RMB10.044 billion, and the annual net profit is RMB 1.509
billion, with a difference of RMB 8.535 billion. The main factors causing the difference are: asset impairment provision of RMB 397
million, depreciation and amortization of RMB 7.799 billion, financial expense of RMB 1.732 billion, decrease in receivables from
operating activities of RMB 851 million, decrease in payable from operating activities of RMB -2.899 billion, increase in inventory
of RMB -344 million, investment losses of RMB 211 million, and others of RMB 788 million.
18
Beijing Shougang Co. Ltd Annual Report 2022
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 2022 Year-begin of 2022
Proportion
Proportion of total Proportion of Notes
Amount Amount changes
assets total assets
Cash and Cash
9,470,472,522.05 6.61% 10,284,988,713.99 6.88% -0.27%
equivalents
Accounts receivable 1,450,008,897.10 1.01% 1,678,608,393.71 1.12% -0.11%
Inventories 11,960,246,748.15 8.35% 12,425,502,043.91 8.31% 0.04%
Long-term equity
2,724,285,925.35 1.90% 3,065,928,898.28 2.05% -0.15%
investments
Fixed assets 93,331,072,969.17 65.19% 97,227,169,862.20 65.06% 0.13%
Construction in
7,673,649,852.77 5.36% 7,186,767,838.55 4.81% 0.55%
progress
Right-of-use assets 83,107,359.45 0.06% 100,279,997.64 0.07% -0.01%
Short-term
29,580,006,103.39 20.66% 25,278,373,316.25 16.92% 3.74%
borrowings
Contract liabilities 4,508,016,725.74 3.15% 5,230,456,327.37 3.50% -0.35%
Long-term
10,594,350,000.00 7.40% 11,692,710,000.00 7.82% -0.42%
borrowings
Lease liabilities 72,439,836.79 0.05% 86,123,210.35 0.06% -0.01%
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 sales in Other
Item Opening balance changes in value changes in accrual in purchase in Closing balance
the period changes
the period equity the period the period
Financial assets
Other equity
instruments 264,900,763.97 -32,134,630.16 232,766,133.81
investments
Financing
4,015,188,495.05 3,489,134,871.56
receivables
Other non-current
80,000,000.00 -765,992.40 79,234,007.60
financial assets
Total 4,360,089,259.02 -765,992.40 -32,134,630.16 0.00 0.00 0.00 0.00 3,801,135,012.97
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
Item Carrying amount at 31.12.2022 (RMB) Restriction reason
Cash and Cash equivalents 1,140,407,749.24 All kinds of deposits
Notes receivable 328,829,159.08 Pledged notes
Accounts receivable 24,223,581.32 Pledged notes
Total 1,493,460,489.64
(1) As of December 31, 2022, except for RMB 1,090,407,749.24 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 849,769.13. This part of interest does not belong to "cash and
cash equivalents."
19
Beijing Shougang Co. Ltd Annual Report 2022
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)
4,701,092,730.53 3,400,636,748.78 38.24%
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 Realized
non-achievement
asset Related Investment amount investment income up to Date of Index of
Project Investme Capital Project Anticipated of planned
investme industri during the reporting amount up to the the end of disclosure disclosure
name nt method source schedule benefits schedule and
nt or not es period end of reporting reporting (if any) (if any)
anticipated
(Y/N) period period
income
New During trial
energy production, the
automoti Iron project has been
ve Self-built Y and 665,663,669.96 1,663,048,752.15 Self-raised 94.96% 437,370,000.00 9,678,561.03 provisionally
electrical steel estimated to be
steel transferred to
project fixed assets
Zhixin
Co. Iron The devices of
Oriented Self-built Y and 641,119,636.03 1,314,052,905.22 Self-raised 88.23% 391,380,000.00 the project are
phase II steel being installed
project
Zhixin
Co.
High-end
Iron The project is
heat
Self-built Y and 183,731,602.88 183,731,602.88 Self-raised 10.65% 436,810,000.00 undergoing civil
treatment
steel construction
engineeri
ng
project
Total -- -- -- 1,490,514,908.87 3,160,833,260.25 -- -- 1,265,560,000.00 9,678,561.03 -- -- --
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
Total raised
Proportion of
Total raised funds with Total Use and
Total raised total Total raised Raised funds
funds that have altered accumulative ownership
Year for Method of Total raised funds that have accumulative funds that have that have been
been used in purposes raised funds change of
fund-rai sing fund-raising funds been used raised funds not been used left unused for
the current during the with altered unused raised
accumulatively with altered yet over two years
period Reporting purposes funds
purposes
Period
Deposit in
Non-public Jingtang Co.
2022 29,120 21,852.33 21,852.33 0 0 0.00% 6,935.83 0
offering fund raising
special account
Total -- 29,120 21,852.33 21,852.33 0 0 0.00% 6,935.83 -- 0
Explanation of the overall use of raised funds
During the reporting period, the total amount of supporting funds raised by the Company through non-public issuance of ordinary shares is RMB291,199,983.58, and after deducting the
underwriting fees of the lead underwriter, the special account of the Company for raising funds received subscription funds of RMB287,603,983.82; After deducting the fees of
independent financial advisers and other related fees for the restructuring, the net capital raised is RMB 273,368,221.41.
During the reporting period, the company has used the raised funds of RMB 218,523,294.14.1. The Company has used RMB 151,603,440.25 to supplement working capital and repay
debts; 2. The Company transferred RMB 136,149,157.84 to the special account of Jingtang Co. for the comprehensive transformation project of energy saving and consumption
reduction of the front railway system, of which, RMB 66,919,853.89 has been used.
As of December 31, 2022, the accumulated interest income generated by the raised funds is RMB 277,617.54, the balance of the special account for the raised funds of the Company is
RMB 0.00, and the balance of the special account for the raised funds of Jingtang Co. is RMB69,358,307.22.
(2) Committed projects of raised funds
√ Applicable □ Non Applicable
Unit: RMB’0,000
Committed investment Whether Total Adjusted The Accumul Invest ment Date when Benef its Whet her Whet her
projects and investment of projects committe d total investme nt ative progre ss as the projec ts recor ded the estim there are
20
Beijing Shougang Co. Ltd Annual Report 2022
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
(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 saving and
Not
consumption reduction No 125,000 13,614.92 6,691.99 6,691.99 49.15% No
applicable
comprehensive
transformation project
Not
Supplementary liquidity No 125,000 15,160.34 15,160.34 15,160.34 100.00% No
applicable
Subtotal of committed
-- 250,000 28,775.26 21,852.33 21,852.33 -- -- 0 -- --
investment projects
Investment of excessive raised funds
Not applicable 0 0 0 0 0.00% 0
Total -- 250,000 28,775.26 21,852.33 21,852.33 -- -- 0 -- --
Explain the circumstances and
reasons for failing to achieve
the planned progress and
estimated income by item Not applicable
(including the reasons why
"Reach the estimated benefit" is
selected as "Not applicable")
Explanations of the material
Not applicable
changes in the project feasibility
Amount, use, and use progress
Not applicable
of excessive raised funds
Change of the implementation
location of the investment Not applicable
project raised funds
Adjustment of implementation
methods of investment projects Not applicable
with raised funds
Advance investment and
replacement of investment Not applicable
projects with raised funds
Temporary replenishment of
working capital with the idle Not applicable
raised funds
Surplus raised funds for project
impleme ntation and reasons for Not applicable
the surplus
Use of unused raised funds Deposited in a special fund raising account
Problems in the use of raised
funds and disclosure, or other Not applicable
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
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
21
Beijing Shougang Co. Ltd Annual Report 2022
Iron and steel smelting, steel
rolling, other metal smelting and
calendering processing and
Shougang
marketing; Production and sale of
Jingtang United
Subsidiary sinter, pellet, coke and chemical 35,821,676,294.00 79,073,296,194.21 35,454,264,852.74 73,637,550,233.13 1,291,801,366.27 1,122,052,438.96
Iron & Steel
products; Power generation and
Co., Ltd.
supply; Production and sales of
secondary and multiple energy
and resource reuse products
Cold-rolled electrical steel strip
manufacturing; Metallurgical
special equipment manufacturing;
Motor manufacturing;
Manufacturing of transmission,
distribution and control
equipment; Energy-saving
Shougang technology promotion services;
Zhixin Qian'an New material technology
Electromagneti Subsidiary promotion services; Business 9,925,868,384.15 21,220,225,253.82 12,157,609,553.25 13,918,944,889.64 1,176,341,300.51 1,080,892,444.41
c Materials Co., management consulting services;
Ltd. Industrial design services;
Product quality inspection
services; Building materials,
non-metallic minerals and
products, metal materials, metal
products, chemical products
(excluding dangerous chemicals)
wholesale and retail
Production of cold rolled sheet,
hot dip galvanized steel coil;
Beijing General freight; Design and sales
Shougang Cold of cold-rolled sheet, hot-dip
Subsidiary 2,600,000,000.00 6,153,649,016.46 -1,063,461,207.16 10,781,367,755.25 223,905,580.96 216,492,299.49
Rolling Co., galvanized steel coil;
Ltd. Warehousing services; Technical
development, technical
consultation
Beijing
Investment management; Project
Shougang Steel
investment; Asset management;
Trading
Subsidiary Warehousing services; Market 1,136,798,235.00 20,077,500,669.03 12,104,999,464.36 955,028,309.36 403,939,890.69 389,995,788.91
Investment
research; Technology
Management
development; Sale of steel
Co., Ltd.
Technology development,
technology consulting,
technology transfer, technology
Beijing
services; Business management
Shougang New
consulting; Economic
Energy
information consulting; Sales of
Automobile Subsidiary 980,000,000.00 1,115,103,347.20 1,093,813,618.40 8,618,382.01 134,849,692.29 133,942,647.56
machinery and equipment, steel;
Material
Rental of machinery and
Technology
equipment (except motor
Co., Ltd.
vehicles); Import and export of
goods; Technology import and
export; Agent import and export
Metallurgical technology
development and consulting
services; Environmental
protection technology promotion
services; Business management
consulting services; Security
consulting services; Computer
application software
Qian'an
development; Special equipment
Shougang
for environmental protection,
Metallurgical Subsidiary 1,900,000.00 212,187,602.54 -85,375,345.88 39,105,861.65 10,558,507.63 10,558,507.63
steel slag, water slag, slag, dust
Technology
removal ash, desulfurization ash,
Co., Ltd.
steel, chemical products
(excluding hazardous chemicals)
wholesale, retail; Domestic
advertising design, production,
agency, release; Non-owned
house leasing services, etc.
(within the scope authorized by
the owner of the house)
22
Beijing Shougang Co. Ltd Annual Report 2022
Coking; Coke oven gas, tar, crude
benzene, sulfur, ammonium
sulfate, ammonium thiocyanate,
primary coal chemical products
manufacturing; Waste heat
utilization; Hardware products,
building materials, mining special
equipment and spare parts,
Qian'an construction machinery spare
Sinochem Coal parts, rubber products, plastic
Chemical Joint stock products, lubricating grease, pig 992,400,000.00 4,529,177,685.54 1,780,985,407.28 8,253,813,834.07 -409,931,923.56 -414,611,940.11
Industrial Co., iron, ferroalloy, iron concentrate
Ltd. powder, pellet iron ore, sintered
iron ore, iron ore, limestone,
quartzite, dolomite, furnace
charge, bentonite, coke, coke
powder, billet, chemical products
(excluding licensed chemical
products), coal wholesale, zero
Sell; Coking technical
consultation and service
Coke, coal tar, benzene, sulfuric
Tangshan acid, ammonium sulfate, gas,
Shougang CDQ coke waste heat power
Jingtang Joint stock generation, steam production and 2,000,000,000.00 3,587,876,141.47 2,196,287,262.09 13,921,855,400.28 50,756,339.47 54,389,297.30
Xishan Coking sales; Technical consulting
Co., Ltd. services; Labor service
(excluding labor dispatch).
Acquisition and disposal of subsidiaries during the reporting period
□ Applicable √ Non Applicable
X. Structured entity controlled by the Company
□ Applicable √ Non Applicable
XI. Future development prospects
1. Industry competition pattern and development trend
In 2023, under the influence of inflation and geopolitics, global economic growth will slow down, and the economic trend of major
economies will diverge. China's economic growth rate will show a low before and high after, gradually climbing trend. In the first
half of the year, the economic recovery will be relatively slow due to the impact that macroeconomic relaxation policies will take
some time to take effect. In the second half of 2023, China's economic upswing will be more obvious. Iron and steel industry will
still maintain strong supply and weak demand pattern, the competition situation will be more intense, iron and steel enterprises will
still face greater operating pressure.
2. Corporate development strategy
Shougang takes the promotion and implementation of the "Two Strong and three Excellent" project (the steel industry development
goal of strong profitability, strong innovation ability, excellent asset quality, excellent operation efficiency, energy conservation and
environmental protection) as its strategic focus. Shougang is firmly committed to the strategic focus of "green manufacturing,
intelligent manufacturing, high-quality manufacturing, lean manufacturing and precise service", and adheres to the two-wheel drive
of "capital + operation" to promote deepening reform and high-quality development of the enterprise. At the same time, Shougang
continues to adhere to the development direction of "quality + service", and continues to promote the development of high-end
products focusing on electrical steel, automobile plate and tin (chromium) plating plate. By continuously improving the service level
and operating efficiency of steel material manufacturing, Shougang will form a group of strategic product customer clusters with
international competitiveness, and strive to build the company into a listed steel company with international competitiveness and
influence.
3. Operating plans of 2023
(1) Output of Major Products
Iron 21.47 million tons, year-on-year decrease of 3.4%; Steel 22.22 million tons, year-on-year decrease of 4.3%; Material 20.73
million tons, year-on-year decrease of 6.5%. The details are as follows:
① Qiangang Co.: 8.00 million tons of iron, year-on-year decrease of 1.5%; 8.42 million tons of steel, year-on-year decrease of 0.4%;
8.10 million tons of steel products, year-on-year decrease of 0.1%.
② Jingtang Co.: 13.47 million tons of iron, year-on-year decrease of 4.5%; 13.80 million tons of steel, year-on-year decrease of
6.6%; 13.05 million tons of steel products, year-on-year decrease of 8.8%.
③ Zhixin Co.: 1.56 million tons of electric steel, year-on-year increase of 5.1%. Including: 1.30 million tons of non-oriented electric
steel, year-on-year increase of 1.6%; 0.26 million tons of oriented electric steel, year-on-year increase of 26.2%.
④ Cold-R Co.: 1.80 million tons of cold-rolled steel sheets, year-on-year decrease of 2.1%. Including: 0.85 million tons of
continuous annealing line for cold-rolled steel sheets, year-on-year decrease of 2.9%; 0.85 million tons of galvanized sheet,
year-on-year decrease of 6.3%, 0.1 million tons of Cold rolled sheet, year-on-year increase of 78.6%.
(2) Budget arrangement for financial indicators
RMB 107.76 billion for operating revenue, year-on-year decrease of 8.8%, including: RMB 37.25 billion for operating revenue of
parent company, year-on-year decrease of 4.5%; RMB 65 billion for operating revenue of Jingtang Co., year-on-year decrease of
11.7%; RMB14 billion for operating revenue of Zhixin Co., year-on-year increase of 0.6%; RMB10 billion for operating revenue of
Cold-R Co., year-on-year decrease of 7.2%; RMB0.76 billion for operating revenue of Steel Trading, year-on-year decrease of 20%.
(3) Budget arrangement for cashflow
23
Beijing Shougang Co. Ltd Annual Report 2022
RMB 161.088 billion for cash inflows, including RMB 122.017 billion for cash inflow from operating activities, RMB 76 million for
cash inflow from investing activities, RMB 38.994 billion for cash inflow from financing activities.
RMB 162.148 billion for cash outflows, including RMB 110.038 billion for cash outflow from operating activities, RMB 6.240
billion for cash outflow from investing activities, RMB 45.870 billion for cash outflow from financing activities.
(4) Budget arrangement forfixed-assets project capital expenditure
Arrangement of fixed assets investment is RMB 4.808 billion, including: RMB 1.349 billion for Qiangang Co., RMB 2.156 billion
for Jingtang Co., RMB 1.164 billion for Zhixin Co., RMB 70 million for Cold-R Co., RMB 68 million for Steel Trading and RMB 1
million for Qian'an Metallurgical Co.
4. Potential risk
(1) Policy and industry risk
According to the Ministry of Industry and Information Technology, the National Development and Reform Commission, the
Ministry of Environment jointly issued the "Guidance on promoting the High-quality development of the iron and Steel Industry" "to
control the total amount of iron and steel, achieve safe carbon reduction, ensure 2030 carbon peak" provisions, steel production
policy gradually implemented, steel enterprises are facing pressure to limit production generally increased. The capacity utilization
rate of some enterprises has been affected, resulting in a pattern of supply exceeding demand in the market. Meanwhile, the price of
iron ore and other raw materials remains high, which increases the production cost and operation difficulty of steel enterprises.
In order to cope with the above risks, first, the company actively responds to the external market, strengthens market prediction and
analysis, optimizes resource allocation, fully implements the "three and three" business strategy, and improves the ability to resist
market risks. Second, the company to improve the very low cost operation capacity, continue to increase cost reduction and
efficiency efforts. The company pays close attention to the implementation of measures to improve efficiency and benefit, pays close
attention to the target enterprises, systematically, comprehensively and permanently reduces costs, speeds up the creation of
comparative advantages, and goes all out to complete the cost control target. Third, the company is promoting in key engineering
projects, giving full play to the advantages of production line and green manufacturing, improving the ability of "manufacturing +
service", promoting the optimization of product structure, strengthening the market promotion of initial products and new products,
and providing support for the realization of high-quality development of the enterprise.
(2) Low carbon environmental risk
Under the background of the policy of "carbon peak and carbon neutral", ultra-low emissions have become the norm, and
environmental protection policies in key regions such as Beijing, Tianjin and Hebei are increasingly stricter, putting higher
requirements on enterprises to implement green and sustainable development, resulting in unprecedented pressure on enterprises'
environmental protection costs.
In order to cope with the above risks, first, the company will further build a solid foundation for high-quality development, improve
high-quality development capacity, continue to maintain healthy development, practice the responsibility of the "leader", deeply
implement the green action plan, and make green become the background of high-quality development of the enterprise. Second, the
company deepens the construction of LCA system, promotes the release of EPD and carbon border tax certification, speeds up the
construction of low-carbon management system, and promotes the construction of low-carbon dedicated line of automobile board to
meet the needs of customers for carbon reduction. Third, the company continues to build a green supply chain system, promote the
selection of green materials, promote the whole process of procurement, production, transportation and other green process.
(3) Horizontal competition risk
Shougang Group and its related parties have a certain degree of horizontal competition with the Company.
In order to solve the horizontal competition, during the first restructuring, Shougang Group issued “the commitment on the settlement
measures and avoidance of horizontal competition after the assets restructuring”. According to the iron and steel industry
development plan of Shougang Group, Shougang Co. will be the only platform for the development and integration of the iron and
steel and upstream iron ore resources industry of Shougang Group in China, and eventually achieve the overall listing of Shougang
Group's iron and steel and upstream iron ore resources business in China. Since then, Shougang Group has made further
commitments on the basis of the above-mentioned commitments of horizontal competition. These commitments are fulfilled on
schedule and for details, please refer to “Corporate Governance” in the annual report.
(4) Marketing risk
From the perspective of market environment, China's economic development is facing the triple pressure of shrinking demand,
supply shock and weakening expectations. The market fluctuation is increasing, which leads to the increasingly severe competitive
environment at home and abroad. From the perspective of industrial environment, overcapacity in the iron and steel industry is still
serious, product homogeneity competition is intensifying, and the direction of product structure adjustment is converging.
In order to cope with the above risks, first, the company strengthens market awareness, continues to pay attention to the development
trend of advanced enterprises in the industry, and focuses on creating competitive advantages. At the same time, the company
stabilizes the cooperation with leading enterprises, closely follows the upgrading and development of the industry, actively and
continuously develops the end user market, and extends and expands the full coverage of the middle and high-end user groups.
Second, the company adheres to the responsibility and mission of "service creates value", based on meeting user needs and guided by
improving user service experience, further improves differentiated service ability and consolidates and enhances service brand image.
Third, the company gives full play to the advantages of multiple production lines and rich varieties, promotes the in-depth
optimization and adjustment of product structure and channel structure, and improves the contribution of structural adjustment to
operating benefits. Finally, the company strengthens internal and external, internal coordination to improve efficiency and increase
income and create efficiency, speeds up the market response speed, and supports the improvement of production line efficiency.
(5) Related transactions risk
Related party transactions between Shougang Shares 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 above-mentioned regular related transactions are the continuous related transactions in the ordinary operation and production
24
Beijing Shougang Co. Ltd Annual Report 2022
process of the Company, all of which are signed agreements in accordance with regulations and approved legally, and the
transactions will not affect the independence of the Company. The Company will strictly implement the provisions of related
transactions, perform the obligation of information disclosure in accordance with the requirements of the stock listing rules and the
Articles of Association, ensure the openness, fairness and justice of related transactions, and protect the legitimate rights and interests
of the Company and all shareholders.
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
China Merchants
Securities, Chuangjin
Company future
Hexin Fund, Fengling
product planning,
Capital, Shaoxia The details disclosed on the
January 18, Conference Telephone carbon emission
Institution Capital, Zhonghe interactive platform on January
2022 room Communication reduction measures and
Capital, and Yaolin 20, 2022.
electrical steel future
Capital and other
development, etc
analysts and
institutional investors
Nord Fund Liu Gao,
Wang Chao, Yin Min,
Shaanxi Shiyang
Group Fu Gui,
Chuanjiang Investment
Tu Yulin, Han De Fund
Xie Gui, Southern
Tianchen Jiang Hao,
Weng Kaisong,
Dacheng Investment
Wan Yan, Lin Zhe, Ivy
Capital Xianfeng,
Chuanhua Holdings Lu
Rongqing, Jin Yuan
Asset Management
Huang Yizhong,
Oriental International
Jiang Yumeng, Jin
Chen Investment Wu
Xiufang, Central
African CITIC Bank
Lv Shuang, Hunan
Light Salt Venture
Capital Lei Yu,
Shengquan Hengyuan Electrical steel,
Ouyang Tianyi, Vector automobile plate and
The details disclosed on the
March 17, Conference Telephone Fund Wang Su, Zhao other products,
Institution interactive platform on March 21,
2022 room Communication Xueang, Su Min industry forecast, raw
2022.
Investment Geng Yan, material end guarantee,
Suzhou Guoxin Jin Ye, etc
Taiping Asset Shi
Jiahuan, Wang
Renshuang, Ying
Yuxiang, Liu Hao,
Shanghai Dehui
Investment Prince
Heng, Xinda Asset in
the Ocean, Ruihua
Investment Zhang
Xiaobing, Shengquan
Hengyuan Zhou Zhou
Zhou, Weixing
Investment Yang
Kehua, Shandong
Guohui Xu Qingrui,
Dawan Investment
Feng Rui, Yi Yi
Investment Zhou
Gaohua, Hengtaihua
Shengli Baicun, Dayan
Capital Hua Jie, Huatai
Asset Hu Lan, Jinchen
Investment Tian Yuan,
Wang Xiaoran, Qianhe
25
Beijing Shougang Co. Ltd Annual Report 2022
Capital Xie Ping,
Xinda Asset Ma He,
Yihe Yinfeng Zhao
Fangyi, Yingke Capital
Zhou Fengchun,
Zhuhai Jinteng Huo
Yuchen, Shandong
Guohui Liu Ke,
Shanghai Hanhui
Investment Sun Fan,
Guoren Insurance
Wang Qiong, Beijing
Chuanfa Ao Yukun, Su
Gaoxin Investment Zou
Wenjun, Yongjin
Investment Wen Xin,
Hunan Caixin Deng
Guoyi, Ansteel Group
Capital Zhang Fengjiu,
Caixin Securities Liang
You, Guoxin Securities
Min Xiaoping, Guolian
Securities Liu Xing,
Yuekai Securities
Zhuge Xiuzi, Wu
Yuchen from Jianghai
Securities, Peng Ling
and Fu Miaoquan from
Huatai United
Securities and other 49
institutions and more
than 60 institutional
investors
Nord Fund Liu Gao,
Wang Chao, Yin Min,
Shaanxi Shiyang
Group Fu Gui,
Chuanjiang Investment
Tu Yulin, Han De Fund
Xie Gui, Southern
Tianchen Jiang Hao,
Weng Kaisong,
Dacheng Investment
Wan Yan, Lin Zhe, Ivy
Capital Xianfeng,
Chuanhua Holdings Lu
Rongqing, Jin Yuan
Asset Management
Huang Yizhong,
Oriental International
Jiang Yumeng, Jin
Chen Investment Wu Electrical steel,
Xiufang, Central automobile plate and
The details disclosed on the
March 18, Conference Telephone African CITIC Bank other products,
Institution interactive platform on March 21,
2022 room Communication Lv Shuang, Hunan industry forecast, raw
2022.
Light Salt Venture material end guarantee,
Capital Lei Yu, etc
Shengquan Hengyuan
Ouyang Tianyi, Vector
Fund Wang Su, Zhao
Xueang, Su Min
Investment Geng Yan,
Suzhou Guoxin Jin Ye,
Taiping Asset Shi
Jiahuan, Wang
Renshuang, Ying
Yuxiang, Liu Hao,
Shanghai Dehui
Investment Prince
Heng, Xinda Asset in
the Ocean, Ruihua
Investment Zhang
Xiaobing, Shengquan
Hengyuan Zhou Zhou
Zhou, Weixing
26
Beijing Shougang Co. Ltd Annual Report 2022
Investment Yang
Kehua, Shandong
Guohui Xu Qingrui,
Dawan Investment
Feng Rui, Yi Yi
Investment Zhou
Gaohua, Hengtaihua
Shengli Baicun, Dayan
Capital Hua Jie, Huatai
Asset Hu Lan, Jinchen
Investment Tian Yuan,
Wang Xiaoran, Qianhe
Capital Xie Ping,
Xinda Asset Ma He,
Yihe Yinfeng Zhao
Fangyi, Yingke Capital
Zhou Fengchun,
Zhuhai Jinteng Huo
Yuchen, Shandong
Guohui Liu Ke,
Shanghai Hanhui
Investment Sun Fan,
Guoren Insurance
Wang Qiong, Beijing
Chuanfa Ao Yukun, Su
Gaoxin Investment Zou
Wenjun, Yongjin
Investment Wen Xin,
Hunan Caixin Deng
Guoyi, Ansteel Group
Capital Zhang Fengjiu,
Caixin Securities Liang
You, Guoxin Securities
Min Xiaoping, Guolian
Securities Liu Xing,
Yuekai Securities
Zhuge Xiuzi, Wu
Yuchen from Jianghai
Securities, Peng Ling
and Fu Miaoquan from
Huatai United
Securities and other 49
institutions and more
than 60 institutional
investors
Xu Rong and Jin
Binbin from CICC
Asset Management, He
Xinzhi from Sunshine
Asset Management,
Zheng Xiaobing from
HSBC Jinxin Fund,
Zhu Xiaoling from
Shaoxia Capital, Zhang
Funing from Lide
Investment, Wang
Xiaoran from Jinchen
Investment, Wang Xing
from Shaanxi Company strategic
The details disclosed on the
February 22, Conference Telephone Zhaorong, Zhang Ya product introduction,
Institution interactive platform on March 24,
2022 room Communication from Shanghai Chunda dual carbon policy
2022.
Fund, Ning Bo impact, etc
Renqing Liyao from
Ningbo, Tang Changfu
from Yihe Yinfeng,
Jiang Hao and Weng
Kaisong from Southern
Tianchen, Tan Qiang
from Dongfang
Cangshan, Jin Yifeng
from Changzhou
Investment, Hu Lina
from Guitie Fund, and
Li Qiwen from China
Africa CITIC Bank,
27
Beijing Shougang Co. Ltd Annual Report 2022
Chang Yulei from
China Electronics
Technology
Investment, Chai Yan
from Jimin Trust
Group, Liu Yanxi from
China State Investment
Group, Shen Bohan
from Guoxin
Investment, Chen Mo
from Evergrande Life
Insurance, Qin Daocen
from Beijing Trust, Hu
Yamin from Special
Investment, Jin
Zhonglei from
Greenland Equity
Investment, Yang
Xuexiang from New
Fox Investment, Shen
Zhaojun from Huaxi
Yinfeng, Zheng Lingqi
from China National
Science and
Technology Reform
Fund, Fan Mingkai
from Xiamen
International Trade,
Gao Hongtao and
Chang Jing from
Yunnan Trust, Gao
Yi'an from Donghai
Fund, and Guo Qing
from Zhongji Taikang,
Xingyin Growth Jiang
Ming, Qianlu Capital
Li Xiang, Golden
Eagle Fund Mai
Jiahuang, Hengrui
Capital Song
Qingxiang, Beijing
Jinta Wang Dan, Yiluo
Capital Qian Lin,
CICC Haotian
Zhanhui, Jiashi Dayan
Cheng Huanqing,
Gong Xiaoqin,
Marshall Wace Li Li,
Shen Wanhongyuan
Wu Bin, Ping An
Securities Qin Shi,
Donghai Securities Ma
Ziqiang, CITIC
Construction
Investment Securities
Wang Jiechao, Kou
Liyao and other 43
institutions and more
than 50 institutional
investors
Xu Rong and Jin
Binbin from CICC
Asset Management, He
Xinzhi from Sunshine
Asset Management,
Zheng Xiaobing from
Company strategic
HSBC Jinxin Fund, The details disclosed on the
March 23, Conference Telephone product introduction,
Institution Zhu Xiaoling from interactive platform on March 24,
2022 room Communication dual carbon policy
Shaoxia Capital, Zhang 2022.
impact, etc
Funing from Lide
Investment, Wang
Xiaoran from Jinchen
Investment, Wang Xing
from Shaanxi
Zhaorong, Zhang Ya
28
Beijing Shougang Co. Ltd Annual Report 2022
from Shanghai Chunda
Fund, Ning Bo
Renqing Liyao from
Ningbo, Tang Changfu
from Yihe Yinfeng,
Jiang Hao and Weng
Kaisong from Southern
Tianchen, Tan Qiang
from Dongfang
Cangshan, Jin Yifeng
from Changzhou
Investment, Hu Lina
from Guitie Fund, and
Li Qiwen from China
Africa CITIC Bank,
Chang Yulei from
China Electronics
Technology
Investment, Chai Yan
from Jimin Trust
Group, Liu Yanxi from
China State Investment
Group, Shen Bohan
from Guoxin
Investment, Chen Mo
from Evergrande Life
Insurance, Qin Daocen
from Beijing Trust, Hu
Yamin from Special
Investment, Jin
Zhonglei from
Greenland Equity
Investment, Yang
Xuexiang from New
Fox Investment, Shen
Zhaojun from Huaxi
Yinfeng, Zheng Lingqi
from China National
Science and
Technology Reform
Fund, Fan Mingkai
from Xiamen
International Trade,
Gao Hongtao and
Chang Jing from
Yunnan Trust, Gao
Yi'an from Donghai
Fund, and Guo Qing
from Zhongji Taikang,
Xingyin Growth Jiang
Ming, Qianlu Capital
Li Xiang, Golden
Eagle Fund Mai
Jiahuang, Hengrui
Capital Song
Qingxiang, Beijing
Jinta Wang Dan, Yiluo
Capital Qian Lin,
CICC Haotian
Zhanhui, Jiashi Dayan
Cheng Huanqing,
Gong Xiaoqin,
Marshall Wace Li Li,
Shen Wanhongyuan
Wu Bin, Ping An
Securities Qin Shi,
Donghai Securities Ma
Ziqiang, CITIC
Construction
Investment Securities
Wang Jiechao, Kou
Liyao and other 43
institutions and more
than 50 institutional
investors
29
Beijing Shougang Co. Ltd Annual Report 2022
Explain the company's
Panorama
performance in 2021
Network The details disclosed on the
and the first quarter of
April 29, 2022 studio Others Institution All investors interactive platform on May 6,
2022, and answer the
(http://ir.p5w. 2022.
questions concerned by
net)
investors
Picc Wang Hui. China
Life Pension Yu Lei,
Shanghai Investment
Morgan Xing Da,
Chengtong Fund Liu
Bo, Huaxia Fund Mao
Ying, Huaxia Wealth
Management Lv
Meng'en, Shenzhen
Chuangfu Zhaoye Liu
Zhengke, Shanghai
Shenzhi Asset Li
Haotian, Pengyang
Fund Luo Cheng,
Ruiyuan Fund Wu Fei,
Shenzhen Red Chip
Investment Wang
Zhidong, Chunhou
Fund Wu Ruozong,
Danshui Quanqian
Yueqiang, Ye Zhishen,
Fuanda Zhang Yixin,
ICBC Ansheng Fan
Yanjun, Guojin Fund
Wu Peiwei, Han Qing
Hongru Yan Xin,
Hangzhou Weiman Li
Electrical steel
Qiang, Huamei
products future
International Fu Nan, The details disclosed on the
Conference Telephone planning, iron ore price
May 12, 2022 Institution Huarun Yuan Da Su interactive platform on May 13,
room Communication trend, reduce crude
Zhan, Golden Eagle 2022.
steel output policy
Fund Xi Junfeng,
impact, etc
Shanghai Mingda
Industrial Prince Heng,
Shanghai Qushi Zhang
Xiuqi, Tianjin Bank
Jiang Yunya, Tibet
United Yisheng Pang
Yuming, Xingyin Fund
Shi Liang, Ordinary
(Shanghai) Investment
Gong Yiming, China
Shandong Expressway
Capital Wang Zijian,
China Science and
Technology Wotu Xu
Wei, CITIC Prudential
Hu Zhe, Shanghai
Oriental Securities
Wang Yanfei, Huafu
Securities Wei
Zhengyu, Zeng Zheng
and Wang Han from
CITIC Securities, Li
Sha from GF Securities
and other 35
institutions and more
than 40 institutional
investors
China Taibao Chen
Xiaoxiao, ICBC Credit
The sales growth of
Suisse Yin Yue, Bank
electrical steel for
of Communications
energy vehicles, the The details disclosed on the
Conference Telephone Wealth Management
June 15, 2022 Institution impact of crude steel interactive platform on June 17,
room Communication Wang Zhejun, HSBC
production policy, and 2022.
Jinxin Zheng Xiaobing,
rising raw material
CICC Asset
prices, etc
Management Xu Rong,
Shanghai Guqu Zhao
30
Beijing Shougang Co. Ltd Annual Report 2022
Zhen, Guohai Franklin
Zhang Dengke,
Ruiyuan Fund Cui Lin,
Taiping Fund Wei
Zhiyu, China National
Offshore Fund Ma Tao
and Bao Jianglin,
Boshi Fund Chen Xi,
Guoshou Asset Cui
Xinyang, Taibao Asset
Zhang Zhe and Wei
Wei, Jingshun Great
Wall Li Jianlin, Runhui
Investment Jiang
Yangjing, Rongtong
Fund Zhao Yixiang,
Zhu Min from
Changxin Fund, Ma
Rui from Changjiang
Pension, He Xinzhi
from Sunshine Asset,
Wang Huixian from
CITIC Securities (self
operated), Pang
Xinghua from Yanhang
Investment, Ma
Zhefeng from Heyong
Investment (Beijing),
Chen Yongqiang from
Tailin Investment,
Yang Liyuan from
Jianxin Fund, Tong
Wei from Huaxia Fund,
Jiao Yun from Jiashi
Fund, Gu Liping from
Everbright Baode
Trust, Fan Yaoyu from
Shenzhen Qiyuan
Wealth, Zhang Tingjian
from Yingfeng Capital,
Wei Hua from Yuanxin
(Zhuhai) Private Equity
Fund, and Li Xiang
from Hangzhou Qianlu
Investment,
Chongyang Investment
He Jianqing,
Zhengyuan Investment
Tang Zhe, Everbright
Securities Dai Mo,
Guotai Junan Li
Pengfei, Wei Yudi,
Wang Hongyu
China Taibao Chen
Xiaoxiao, ICBC Credit
Suisse Yin Yue, Bank
of Communications
Wealth Management
Wang Zhejun, HSBC
Jinxin Zheng Xiaobing,
CICC Asset
The sales growth of
Management Xu Rong,
electrical steel for
Shanghai Guqu Zhao
energy vehicles, the The details disclosed on the
Conference Telephone Zhen, Guohai Franklin
June 16, 2022 Institution impact of crude steel interactive platform on June 17,
room Communication Zhang Dengke,
production policy, and 2022.
Ruiyuan Fund Cui Lin,
rising raw material
Taiping Fund Wei
prices, etc
Zhiyu, China National
Offshore Fund Ma Tao
and Bao Jianglin,
Boshi Fund Chen Xi,
Guoshou Asset Cui
Xinyang, Taibao Asset
Zhang Zhe and Wei
Wei, Jingshun Great
31
Beijing Shougang Co. Ltd Annual Report 2022
Wall Li Jianlin, Runhui
Investment Jiang
Yangjing, Rongtong
Fund Zhao Yixiang,
Zhu Min from
Changxin Fund, Ma
Rui from Changjiang
Pension, He Xinzhi
from Sunshine Asset,
Wang Huixian from
CITIC Securities (self
operated), Pang
Xinghua from Yanhang
Investment, Ma
Zhefeng from Heyong
Investment (Beijing),
Chen Yongqiang from
Tailin Investment,
Yang Liyuan from
Jianxin Fund, Tong
Wei from Huaxia Fund,
Jiao Yun from Jiashi
Fund, Gu Liping from
Everbright Baode
Trust, Fan Yaoyu from
Shenzhen Qiyuan
Wealth, Zhang Tingjian
from Yingfeng Capital,
Wei Hua from Yuanxin
(Zhuhai) Private Equity
Fund, and Li Xiang
from Hangzhou Qianlu
Investment,
Chongyang Investment
He Jianqing,
Zhengyuan Investment
Tang Zhe, Everbright
Securities Dai Mo,
Guotai Junan Li
Pengfei, Wei Yudi,
Wang Hongyu
Danshui Spring
(Beijing) Investment
Management Cao
Yang, Guohua Xingyi
Insurance Asset
Management Co., Ltd.
Han Dongwei,
Guanfeng Asset Tang
Competitive advantage
Zhe, Chongyang
of electrical steel The details disclosed on the
Conference Telephone Investment He
July 7, 2022 Institution products, impact of interactive platform on July 8,
room Communication Jianqing, 3w Fund Liu
crude steel output 2022.
Siming, Zhanbo
policy, etc
Investment Xiao Bin,
Leike Asset
Management Guo
Jiayi, Yinyou Asset
Sun Jiaqi, China
Merchants Securities
Yue Hengyu, Tang
Xiao
Guohua Xingyi
Electrical steel product
Insurance Asset Han
future planning,
Dongwei, Zhongcheng The details disclosed on the
Conference Telephone technical barriers,
July 13, 2022 Institution Automobile Insurance interactive platform on July 14,
room Communication automotive plate,
Yang Zhi, Dongwu 2022.
galvanized plate
Securities Research
orders, etc
Institute Wang Qinyang
8:00am-12:00 8:00am-12:00am:
am: Panorama Small and medium Explain the company's
Network investors 2022 semi-annual The details disclosed on the
August 24,
studio Others Others 1:00pm-5:00pm: Dai performance and interactive platform on August
2022
(http://ir.p5w. Mo, Shen Yuting, Fan answer the questions 25, 2022.
net) Qin from Everbright concerned by investors
1:00pm-5:00p Securities, Chen Qiwei
32
Beijing Shougang Co. Ltd Annual Report 2022
m: Conference from Guangfa
room Securities, Li Pengfei
and Wang Hongyu
from Guotai Jun'an, Fu
Lianxi from Huatai
Securities, Zhang Hao
from Industrial
Securities, Wang
Jiechao and Guo
Yanzhe from CITIC
Securities, Yue Hengyu
from China Merchants
Securities, Lv
Shicheng from
Changjiang Securities,
Liu Yaoqi, Wu Yuan,
Song Hanqing from
Zhongtai Securities,
Zhao Yutian from
Northeast Securities,
Xu Xinzhe from China
Europe Fund, Xu Rong
from CICC Asset
Management, and
Zhang Zexun from
China Canada Fund, Yu
Lei from China Life
Pension Insurance, Li
Jianlin from Jingshun
Great Wall, Huang
Jingwen from Southern
Fund, Zhang Zhe from
Pacific Asset
Management, Li
Weifeng from
Pengyang Fund, Yao
Xuzeng from Guangfa
Fund, Lu Heng from
Huabao Fund, Wang
Xiaodan from Hua'an
Fund, Han Dongwei
from Guohua Xingyi
Insurance, Han
Chenhao from Fuguo
Fund, Hu Xiao from
Dongzheng Asset
Management, Chen
Lirui and Zhang
Baiyang from ICBC
Credit Suisse, Gong
Runhua from Boshi
Fund etc.
8:00am-12:00am:
Small and medium
investors
1:00pm-5:00pm: Dai
Mo and Liu Na from
Everbright Securities,
Ma Ye from Zhejiang
8:00am-12:00 Securities, Li Pengfei
am: Panorama and Wang Hongyu
Network from Guotai Junan, Yue Explain the company's
studio Hengyu from China performance in the first The details disclosed on the
October 28,
(http://ir.p5w. Others Others Merchants Securities, three quarters of 2022 interactive platform on October
2022
net) Su Xiaojie from CITIC and answer investors' 31, 2022.
1:00pm-5:00p Securities, Wang Le questions
m: Conference and Chen Qiwei from
room Guangfa Securities,
Liu Yaoqi from
Zhongtai Securities,
Hu Xiao from
Dongfang Securities,
Luo Weiyu from
Changjiang Securities,
Zhao Liming and Zhao
33
Beijing Shougang Co. Ltd Annual Report 2022
Yutian from Northeast
Securities, Xu Rong
from CICC Asset
Management, Chen
Lirui from ICBC
Credit Suisse, Guo
Chen from Dice
Investment, Zhao Jun
from Shanghai
Shangjin Investment,
and Gao Yunfei from
Capital Management,
Taikang Pension
Insurance Bi Yunpeng
and Xu Dong etc.
Analysts and
institutional investors
such as Huitianfu
Fund, Danshui Spring
(Beijing) Investment
Management Co., Ltd.,
Bank of China Fund, Electrical steel
Hengyue Fund, Qushi production situation,
The details disclosed on the
December 28, Conference Telephone Asset Management, future supply and
Institution interactive platform on December
2022 room Communication Zhonghe Capital, Teda demand situation,
30, 2022.
Hongli Fund, Beijing automobile plate output
Jingxi Venture Capital situation, etc
Fund Management Co.,
Ltd., Fidelity Funds,
China Post Securities,
Changjiang Securities,
Huachuang Securities,
CITIC Securities, etc
Analysts and
institutional investors
such as Huitianfu
Fund, Danshui Spring
(Beijing) Investment
Management Co., Ltd.,
Bank of China Fund, Electrical steel
Hengyue Fund, Qushi production situation,
The details disclosed on the
December 29, Conference Telephone Asset Management, future supply and
Institution interactive platform on December
2022 room Communication Zhonghe Capital, Teda demand situation,
30, 2022.
Hongli Fund, Beijing automobile plate output
Jingxi Venture Capital situation, etc
Fund Management Co.,
Ltd., Fidelity Funds,
China Post Securities,
Changjiang Securities,
Huachuang Securities,
CITIC Securities, etc
34
Beijing Shougang Co. Ltd Annual Report 2022
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 and Rules of Procedures of the General Shareholders Meeting, the Board of Directors, the
Supervisory Committee, the company organizes the General Shareholders Meeting, the meeting of director board, and the meeting of
supervisory committee. Directors and supervisors are assiduous and dutiful, complying with the applicable rules and regulations,
diligently safeguarding the lawful rights and interests of the company and its all shareholders. The management regularly operates
the company, and faithfully abide by the rules of internal system. In accordance with the relevant regulations such as the Listing
Rules of Shenzhen Stock Exchange, the Company perform the duty of information disclosure, and guarantee the truthiness, accuracy
and completeness of the prepared information, without any false record, misleading or major omission.
During the reporting period, the Company did its corporate governance work in the following aspects: First, the articles of
Association shall be amended according to the fact that issuance of shares to purchase assets leads to an increase in the total share
capital. Second, according to operational needs, the Company has formulated 48 systems such as Authorization Management System
of the Board of Directors to Managers and Compliance Management System and revised 78 systems such as Rules of Procedure of
the Board of Directors Fund Management System. Thirdly, in response to business adjustments and system updates, the Company
organised internal control self-evaluation in conjunction with the Risk Control Process Manual and the Risk Control Evaluation
Manual. Fourthly, the company carries out the construction of compliance management system centering on organizational
responsibilities, risk identification, system construction and operation mechanism, and establishes a three-database business
management mode guided by risk management and promoted with the "compliance obligation list database" as the core. The contract
legal audit rate and system compliance audit rate have achieved 100%, and no major compliance risk has occurred. Finnally, in
accordance with the Articles of Association, the Rules of Procedure for General Meetings and relevant regulations, the General
Meetings were held by way of "on-site + online voting" to ensure that the matters submitted to the General Meetings for
consideration and approval were in compliance with the law.
As at the end of the reporting period, the Company has 529 systems, among which 516 systems are formulated and implemented by
the company and 13 systems 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 has established a corporate governance structure that conforms to the characteristics of the iron and steel industry
process, supports the strategic development of the enterprise, and ADAPTS to the company's operation and production, and plans and
operates in strict accordance with the law. The company and the controlling shareholders remain completely independent in business,
personnel, assets, institutions, finance and other aspects. The company has a complete procurement, production, marketing and
operation management system, product research and development institutions and personnel are complete, and has the ability of
independent production and operation.
1. 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.
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. 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.
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. 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.
35
Beijing Shougang Co. Ltd Annual Report 2022
III. Horizontal competition
√ Applicable □ Not applicable
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 In December 2021,
Shougang Co. Shougang Co., Ltd. and
(3) The Company will, as far as possible, Shougang Group signed
safeguard the normal operation and the "Management Service
profitability of the existing steel assets not Agreement between
injected into Shougang Co. and ensure that Shougang Group Co., Ltd.
Since the listing the aforesaid assets and businesses do not fall And Beijing Shougang
of the Company, into operational difficulties due to the Co., Ltd. On The Affiliated
there has been Company or other circumstances that prevent Enterprises of Shougang
inter-sector the ultimate injection into Shougang Co. or Group Co., Ltd. ".
The Shougang competition and render such injection legally impeded. Shougang Co., Ltd.
Competition in the
controlling Group Co., Local SASAC connected (4) Each commitment made by the provides management
same industry
shareholder Ltd. transactions Company in eliminating or avoiding services for a total of 14
resulting from competition in the same line of business shall target enterprises in the
the partial also apply to other enterprises under the steel sector of Shougang
conversion to direct or indirect control of the Company Group. Shougang shares
listing. other than Shougang Co. and its subsidiaries, will continue to negotiate
and the Company is obliged to supervise and with Shougang Group and
ensure that the other subsidiaries of the actively promote the
Company implement the arrangements for follow-up work in
each of the matters described in this accordance with the
document and strictly comply with all the commitment to resolve
commitments. horizontal competition.
2. As approved by the second
extraordinary general meeting of the
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
36
Beijing Shougang Co. Ltd Annual Report 2022
Type of
Name of Nature of
association Work progress and
Type controlling controlling Causes Solutions
with the follow-up plan
shareholder shareholder
Company
policies, initiate a process including but not
limited to acquisition, merger, restructuring
and other means in the interests of
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
Extraordinary
Please refer to the company announcement
2022 First Extraordinary General
81.73% March 18, 2022 March 19, 2022 on the disclosure date of the meeting
General Meeting Shareholders
resolution
Meeting
Annual General Please refer to the company announcement
2021 Annual General
Shareholders 83.64% June 29, 2022 June 30, 2022 on the disclosure date of the meeting
Meeting
Meeting resolution
Extraordinary
2022 Second Please refer to the company announcement
General September 09, September 10,
Extraordinary General 83.35% on the disclosure date of the meeting
Shareholders 2022 2022
Meeting resolution
Meeting
Extraordinary
2022 Third Please refer to the company announcement
General November 15, November 16,
Extraordinary General 27.96% on the disclosure date of the meeting
Shareholders 2022 2022
Meeting resolution
Meeting
Extraordinary
2022 Fourth Please refer to the company announcement
General December 23, December 24,
Extraordinary General 83.98% on the disclosure date of the meeting
Shareholders 2022 2022
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 for
of shares Number
of shares of shares changes in
reduced of shares
Status of Start date of End date of held at the increased Other the
Name Post Gender Age in the held at
employment term term beginning in the changes increase
current the end of
of the current or
period the period
period period decrease
(shares)
of shares
Zhao Minge Chairman Incumbent Male 56 2022/12/23 2025/12/22 0 0 0 0 0
Liu Jianhui Director Incumbent Male 57 2022/12/23 2025/12/22 290,000 0 0 0 290,000
Zeng Li Director Incumbent Male 51 2022/12/23 2025/12/22 290,000 0 0 0 290,000
Li Jiantao Director Incumbent Male 44 2022/12/23 2025/12/22 0 0 0 0 0
Independent
Ye Lin Incumbent Male 59 2022/12/23 2025/12/22 0 0 0 0 0
director
Independent
Gu Wenxian Incumbent Male 61 2022/12/23 2025/12/22 0 0 0 0 0
director
Independent
Yu Xingxi Incumbent Male 64 2022/12/23 2025/12/22 0 0 0 0 0
director
Independent
Liu Shen Incumbent Male 47 2022/12/23 2025/12/22 0 0 0 0 0
director
Independent
Peng Feng Incumbent Male 43 2022/12/23 2025/12/22 0 0 0 0 0
director
Supervisory
Sun Yi Incumbent Male 57 2022/12/23 2025/12/22 0 0 0 0 0
board chairman
Guo Liyan Supervisory Incumbent Female 47 2022/12/23 2025/12/22 0 0 0 0 0
Chang
Supervisory Incumbent Female 38 2022/12/23 2025/12/22 0 0 0 0 0
Haiyu
37
Beijing Shougang Co. Ltd Annual Report 2022
Reasons
Number
Number Number for
of shares Number
of shares of shares changes in
reduced of shares
Status of Start date of End date of held at the increased Other the
Name Post Gender Age in the held at
employment term term beginning in the changes increase
current the end of
of the current or
period the period
period period decrease
(shares)
of shares
Employee
Wang
representative Incumbent Male 44 2022/12/23 2025/12/22 0 0 0 0 0
Xingtao
supervisor
Employee
Qu Erlong representative Incumbent Male 41 2022/12/23 2025/12/22 0 0 0 0 0
supervisor
Liu Jianhui General manager Incumbent Male 57 2022/12/23 2025/12/22 0 0 0 0 0
Zhang Vice general
Incumbent Male 46 2022/12/23 2025/12/22 232,000 0 0 0 232,000
Binglong manager
Li Baizheng Chief accountant Incumbent Male 57 2022/12/23 2025/12/22 261,000 0 0 0 261,000
Vice general
Sun Maolin Incumbent Male 46 2022/12/23 2025/12/22 261,000 0 0 0 261,000
manager
Vice general
Li Jingchao Incumbent Male 57 2022/12/23 2025/12/22 261,000 0 0 0 261,000
manager
Vice general
manager/
Chen yi Incumbent Male 55 2022/12/23 2025/12/22 261,000 0 0 0 261,000
secretary of the
Board
Vice general
Xie Tianwei Incumbent Male 41 2022/12/23 2025/12/22 203,300 0 0 0 203,300
manager
Vice general
Wang Kai Incumbent Male 40 2022/12/23 2025/12/22 203,000 0 0 0 203,000
manager
Qiu Yinfu Director Dismissed Male 55 2019/12/23 2022/08/16 290,000 0 0 0 290,000
Wu
Director Dismissed Male 59 2019/12/23 2022/12/22 0 0 0 0 0
Dongying
Independent
Yin Tian Dismissed Male 68 2019/12/23 2022/1/6 0 0 0 0 0
director
Yang Mulin Supervisory Dismissed Male 51 2019/12/23 2022/12/22 0 0 0 0 0
Employee
Cui Aimin representative Dismissed Female 54 2021/7/7 2022/12/22 0 0 0 0 0
supervisor
Vice general
Peng Kaiyu Dismissed Male 42 2019/12/23 2022/08/05 261,000 0 0 0 261,000
manager
Vice general
Li Ming Dismissed Male 48 2019/12/23 2021/10/20 261,000 0 0 0 261,000
manager
Ma Jiaji Chief engineer Dismissed Male 59 2019/12/23 2022/10/20 0 0 0 0 0
Total -- -- -- -- -- -- 3,074,300 0 0 0 3,074,300 --
During the reporting period, did any directors and supervisors resign and was any members of the senior management dismissed
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 Post Type Date Reason of changes
Qiu Yinfu Director Dismissed 2022/08/16 Resignation upon transfer of work
Wu Dongying Director Dismissed 2022/12/22 Resignation upon expiration of term
Yin Tian Independent director Dismissed 2022/01/06 Resignation upon expiration of term
Yang Mulin Supervisory Dismissed 2022/12/22 Resignation upon expiration of term
Employee representative
Cui Aimin Dismissed 2022/12/22 Resignation upon expiration of term
supervisor
Peng Kaiyu Vice general manager Dismissed 2022/08/05 Resignation upon transfer of work
Li Ming Vice general manager Dismissed 2022/10/20 Resignation upon transfer of work
Ma Jiaji Chief engineer Dismissed 2022/10/20 Resignation upon transfer of work
38
Beijing Shougang Co. Ltd Annual Report 2022
II. Current position
Professional background, main work experience and main responsibilities of the current board members, supervisors, and senior
manager of the Company
A. Board members
1. Zhao Minge: The chairman of the Company, the professor-level senior engineer, being a PhD of Engineering with doctoral
education. The major employment history of Mr. Zhao is as follows: a teacher of mining and metallurgy department of Beijing Iron
and Steel College; a deputy director of teaching section of educational division, a deputy director (in charge of daily routine) of
educational division, the vice president of the college; a deputy director of Shougang Training Centre; a deputy director of Shougang
Ironmaking Factory; a deputy director of the No.2 Ironmaking Plant of Shougang Co.; the secretary of CPC Committee of Beijing
Shougang Oxygen Factory; a director of Shougang Training Center (Training Department); the head (first vice president of the
Institute) of Technical Quality Department (Technical Research Institute, Xingang Technical Quality Department); a deputy secretary
of CPC Committee and deputy general manager of Xingang Co.; a member of the board and general manager of Shougang Changzhi
Steel&Iron Co., Ltd.; a director and general manager of Shougang Changzhi Steel&Iron Co., Ltd. (assistant level of the headquarter);
the assistant of general manager of Shougang Corporation, the deputy chief engineer and president of Shougang Technology
Research Institute; later, concurrently, the deputy secretary of the CPC Committee and executive deputy general manager of
Shougang Jingtang United Iron&Steel Co., Ltd.; a standing member of CPC Committee, director, vice general manager of Shougang
Co., at the same time, appointed as the director of Beijing Shougang Co., Ltd. and Shougang Jingtang United Iron & Steel Co., Ltd.
In addition, Mr. Zhao also is a standing member of CPC Committee, director, vice general manager of Shougang Group. Mr. Zhao
served as Chairman of Beijing Shougang Co., Ltd. Also, Mr. Zhao is the deputy secretary of the Party, the director and the general
manager of Shougang Group.
2. Liu Jianhui: The director and general manager of the Company, the professor-level senior engineer, being a master of engineering
with postgraduate education. The major employment history of Mr. Liu is as follows: a professional in the steel-making section of
Beigang Technology Office and deputy director of the steel-making inspection station; a student of Lugou Engineering School of
Shougang; a deputy director of the No.1 Steel-making Plant of Shougang and director of the Shougang’ Research Institute; the chief
engineer, technical assistant of factory manager and technical section director of the No.2 Steelmaking Plant of Shougang and
director of the Research Institute; a technical assistant of the factory manager and director of the technical section and technical
deputy director of the No.2 Steel-making Plant of Shougang Corporation; a deputy director of the No.2 Steelmaking Plant of Beijing
Shougang Co., Ltd.; the assistant of general manager and head of steelmaking department of Shouqin Co.; the assistant of general
manager and deputy general manager of Qiangang Co.; the deputy general manager (acting general manager) and general manager of
sales company of Shougang Corporation; the deputy secretary of CPC Committee, general manager and director of marketing
management department of Shougang Co.; the deputy secretary of CPC Committee of Shougang Co., director, general manager and
director of marketing management department; the deputy secretary of CPC Committee, director and general manager of Shougang
Co., concurrently served as secretary of CPC Committee and director for Jingtang Co. At present, Mr. Liu is the secretary of CPC
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. Ye Lin: independent director, professor and doctoral supervisor, doctor in law, Ye Lin was serving Law School of Renmin
University of China (hereinafter “RUC”) as an assistant, lecturer, associate professor and professor, successively. At present, he is the
director, professor and doctoral supervisor of Civil & Commercial Law Teaching and Research Agency of RUC Law School. He is
also an independent director of China Life Asset Management Co., Ltd., an independent director of Founder Securities Co., Ltd., and
39
Beijing Shougang Co. Ltd Annual Report 2022
a part-time lawyer of Beijing Shengang Law Firm. Major part-time jobs include: the vice president of China Commercial Law
Society under China Law Society, the vice president of Civil and Commercial Law Society under Beijing Law Society, the president
of Beijing Consumer Rights Protection Law Society; a legislative consultant of Financial and Economic Affairs Committee of the
National People's Congress of PRC, a consultant of drafting group to Futures Law, a consultant of Administrative Punishment
Committee of CSRC, a consumer rights protection social supervisor of China Insurance Regulatory Commission, a consultant of the
Legal Professional Committee of the Insurance Society of China, a member of the Advisory Committee of Beijing High People’s
Court, a consultant of the Company Law Committee of China Lawyers Association, a consultant of the Company Law Committee of
Beijing Lawyers Association, a member of the Professional Committee of Shanghai Stock Exchange and China Financial Futures
Exchange, a arbitrator and expert of the Advisory Committee of China International Economic and Trade Arbitration Commission.
Ye Lin serves Shougang Co. as an independent director from 26 December, 2017.
6. 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.
7. Yu Xingxi: The independent director of the Company, a senior accountant with master's degree of Management. He used to be a
soldier of recruit Company 1 of 46 Regiment of 10th Railway Division, a soldier of logistics service Agency of New Management
Department of 10th Railway Division, a soldier of Finance Department of New Management Department of Qinghai-Tibet Line of
Railway soldier, an assistant of finance Department (platoon) of New Management Department of Qinghai-Tibet Line of Railway
soldier, a director of the 4th police Station (deputy company) of New Management Department of Qinghai-Tibet Line of Railway
soldier, an accountant of finance Department (deputy battalion) of new Management Department of Qinghai-Tibet Line of Railway
soldier, Accountant of Finance Department of New Management Department of Railway 10 Division, member of Finance
Department (Deputy section) of New Railway Transportation Department of Railway 20 Bureau, Deputy chief of Planning and
Statistics Department and Deputy chief of Finance Department of Railway 20 Bureau 5, Deputy Chief and chief of Finance
Department of Construction Engineering Department of Railway 20 Bureau, Deputy chief Accountant of Construction Engineering
Department of Railway 20 Bureau, Deputy chief accountant and accountant of Construction Engineering Department of Railway 20
Bureau, Chief Accountant and accountant of Construction Department of Railway 20 Bureau, Chief Accountant and senior
accountant of Finance Department of China Railway Construction Corporation, Deputy Minister of Finance Department of China
Railway Construction Corporation, Director of Capital Settlement Center and senior accountant of China Railway Construction
Corporation, Manager and Senior meeting of Investment Department of China Railway Construction Corporation, Minister and
senior meeting of Finance Department of China Railway Construction Corporation, Director of Finance Department and senior
Accountant of China Railway Construction Corporation Limited, Secretary of the Board of Directors, joint secretary of the Company,
press spokesperson and senior accountant of China Railway Construction Corporation Limited. He is currently the secretary general
of Beijing Association of Listed Companies, independent director of Ruitai Technology Co., Ltd., independent director of Beijing
Kerui International Co., Ltd., and independent director of Sinopharm Pharmaceutical Co., Ltd. He has been an independent director
of Beijing Shougang Co., Ltd. since December 23, 2022.
8. 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.
9. 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.
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Beijing Shougang Co. Ltd Annual Report 2022
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
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. Liu Jianhui: The director and general manager of the Company, a professor-level senior engineer with master's degree of
engineering. The major employment history of Mr. Liu is as follows: a professional in the steel-making section of Beigang
Technology Office and deputy director of the steel-making inspection station; a student of Lugou Engineering School of Shougang; a
deputy director of the No.1 Steel-making Plant of Shougang and director of the Shougang’ Research Institute; the chief engineer,
technical assistant of factory manager and technical section director of the No.2 Steelmaking Plant of Shougang and director of the
Research Institute; a technical assistant of the factory manager and director of the technical section and technical deputy director of
the No.2 Steel-making Plant of Shougang Corporation; a deputy director of the No.2 Steelmaking Plant of Beijing Shougang Co.,
Ltd.; the assistant of general manager and head of steelmaking department of Shouqin Co.; the assistant of general manager and
deputy general manager of Qiangang Co.; the deputy general manager (acting general manager) and general manager of sales
company of Shougang Corporation; the deputy secretary of CPC Committee, general manager and director of marketing management
department of Shougang Co.; the deputy secretary of CPC Committee of Shougang Co., director, general manager and director of
marketing management department; the deputy secretary of CPC Committee, director and general manager of Shougang Co.,
concurrently served as secretary of CPC Committee and director for Jingtang Co. At present, he is the secretary of CPC Committee,
director and general manager of Beijing Shougang Co., Ltd.
2. Zhang Binglong: The deputy General Manager, a senior engineer with master's degree of engineering. The major employment
history of Mr. Zhang is as follows: He used to be the prefurnace worker and professional of technical department of steelmaking
workshop of Shougang No. 1 Steelmaking Plant, researcher and deputy sectional-level researcher of Chief Engineer Office of
Shougang, professional engineer of Production technology Office of Jingtang Steelmaking Operation Department of Shougang,
deputy director, Assistant minister, deputy minister and minister of steelmaking area, Party Secretary, Discipline Inspection
Commission secretary, union chairman and minister of Jingtang Steelmaking Operation Department of Shougang. Secretary of the
Party Committee and Minister of the Steelmaking Operation Department of Shougang Jingtang, Assistant to the general manager and
Minister of the Manufacturing Department of Shougang Jingtang, Deputy Secretary of the Party Committee and Secretary of the
Discipline Inspection Commission of Shougang Shuicheng Iron and Steel (Group) Co., Ltd., Deputy Secretary of the Party
Committee of Beijing Shougang Co., Ltd. Deputy Secretary of the Party Committee and deputy General Manager of Beijing
Shougang Co., Ltd.
3. Li Baizheng: The chief accountant of the Company, an accountant with bachelor's degree. The major employment history of Mr.
Li is as follows: the planning controller of No.1 Steelmaking Factory; the dispatcher of production setion, the planning controller of
steelmaking workshop, the planning controller of production section, the chief controller of production section, the planner of
production section, the director of billet area, the deputy director of production section, the director of finance and accounting section,
planning person in charge of production and planning section, in No. 2 Steelmaking Factory; the deputy director and then director of
finance and accounting department of Qiangang Co.; the director of finance and accounting department of Qiangang Co.; the chief
accountant of Shougang Co. Li Baizheng is the current chief accountant of Shougang Co., the board member of Beijing Shougang
Cold Rolling Co., Ltd. and Shougang Jingtang United Iron & Steel Co., Ltd.
4. Sun Maolin: The deputy general manager of the Company, an engineer with master's degree. The major employment history of
Mr. Sun is as follows: when serving Shougang Medium and Heavy Plate Factory, a professional in the technical section, the deputy
41
Beijing Shougang Co. Ltd Annual Report 2022
secretary of CPC Branch and deputy director of hot rolling section, the secretary of CPC Branch of operation zone B, the deputy
director of technical research section; the deputy director of technical section under technical quality division, an assistant to the
director of technical quality division, the executive deputy director of silicon steel department, the standing deputy director of silicon
steel department in Qiangang Co.; the executive deputy director and then director of silicon steel business department of Shougang
Co.; the director of Silicon Steel Engineering Research Center; the secretary of CPC Committee and director of silicon steel business
department, and an assistant to the general manager of Shougang Co.; the director of silicon steel business department. Sun is the
current deputy general manager of Shougang Co. and director of Silicon Steel Engineering Research Center. He also serves Zhixin
Co. as the executive director, Minmetals Special Steel (Dongguan) Co., Ltd. as the vice chairman of the board, and Minmetals
Tianwei Steel Co., Ltd. as a director.
5. Li Jingchao: The deputy general manager of the Company, an engineer with bachelor's degree. The major employment history of
Mr. Li is as follows: a milling worker of rail workshop in Shougang Middle-sized Factory; an electrician of electrical apparatus
workshop in Shougang Power Factory; the person in charge of the Youth League Committee of Shougang Testing Branch; in
Shougang No. 3 Steel Mill, the worker of steelmaking workshop, the administrative person in charge of the billet cast machine
workshop, the production deputy director of power workshop, the director (leading roles of sections or equivalents) of power
workshop, the director (leading roles of sections or equivalents) of spare parts section, the deputy director (leading roles of sections
or equivalents) of mobile section, the deputy director (leading roles of sections or equivalents) of equipment section, the deputy
director (leading roles of sections or equivalents) of equipment section and director (leading roles of sections or equivalents) of
power workshop, the deputy director (leading roles of sections or equivalents) of equipment section; an assistant to the director, the
deputy director, the director of equipment division and the director of equipment department of Qiangang Co.; an assistant to the
general manager and the director of equipment department of Qiangang Co.; an assistant to the general manager of Qiangang Co.; an
assistant to the general manager of Qiangang Co., and the secretary of CPC Committee and the director of equipment department of
Shougang Co.; an assistant to the general manager of Qiangang Co.; an assistant to the general manager of Qiangang Co., and the
secretary of CPC Committee and the director of equipment department of Shougang Co., the director of intelligent application
department of Shougang Co.; an assistant to the general manager of Qiangang Co., and secretary of CPC Committee and the director
of equipment department of Shougang Co. At present, Li Jingchao is the deputy general manager of Shougang Co., and concurrently
vice chairman of Qian'an Sinochem Coal Chemical Industrial Co., Ltd. and the director of Qian'an China Petroleum Kunlun Gas Co.,
Ltd.
6. Chen Yi: The deputy general manager of the Company, and the board secretary of the Company, a senior economist with doctor's
degree of Management. The major employment history of Mr. Chen is as follows: a professional in the mobile section, an assistant to
the director of the maintenance workshop, the deputy director of the mobile section of Shougang Medium-sized Rolling Mill; the
secretary of the CPC Committee office; a trainee of the overseas training course of Shougang University; the deputy director of the
engineering division of the Jichai technical transformation leading group of Shougang; the deputy director of the Office (CPC Office)
under the Shougang Economy & Trade Department; the deputy director of the board secretary office of Beijing Shougang
Xinganglian Technology&Trade Co., Ltd.; the deputy manager of Shougang Marketing Co.; the deputy director of marketing
management department, the deputy director of marketing management department and the person in charge of the board secretary
office, in Shougang Co.; the board secretary and the director of the board secretary office of Shougang Co.; the general counsel,
board secretary and director of the board secretary office of Shougang Co., and director of Cold-R Co. and Jingtang Co. At the end of
the reporting report, Chen Yi was the deputy general manager, board secretary, general counsel of Shougang Co., and director of
Cold-R Co. and Jingtang Co.
7. 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.
8. 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 Company, assistant to the
general manager and head of the Iron making Operation Department of Shougang Jingtang Company. Deputy General manager 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
Zhao Minge Shougang Group Co., Ltd. Committee, Director and General June 2020 Y
Manager
Executive director of the office of the
Sun Yi Shougang Group Co., Ltd. January 2021 Y
board of supervisors
42
Beijing Shougang Co. Ltd Annual Report 2022
Start date of End date Received remuneration
Name Entity Position in shareholder company
term of term from other entity (Y/N)
Guo Liyan Shougang Group Co., Ltd. Director of audit department June 2017 Y
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
Chang Hiyu Investment Fund Investment director November 2011 Y
Management Co., Ltd.
Notes to the position
in the shareholders’ None
company
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 and Appraisal Committee of the Board of Directors of the
company shall, in accordance with the provisions, formulate the Distribution Measures for the Remuneration and Appraisal of the
General Manager in 2022, and put forward the appraisal opinions, which shall be submitted to the annual board of Directors for
deliberation and approval before implementation. The remuneration of the deputy general manager and other senior management
personnel in 2022 shall be assessed and distributed by the general manager (and director) according to the completion of the work
tasks of each senior management personnel including the deputy general manager as authorized by the board of directors.
Remuneration of directors, supervisors and senior management during the reporting period
Unit：RMB 0,000
Total pretax Whether to get remuneration
Name Position Gender Age Status of employment remuneration received from related parties of the
from the company company
Zhao Minge Chairman Male 56 Incumbent 0 Yes
Liu Jianhui Director Male 57 Incumbent 0 No
Zeng Li Director Male 51 Incumbent 12.52 No
Li Jiantao Director Male 44 Incumbent 0 Yes
Ye Lin Independent director Male 59 Incumbent 12 No
Gu Wenxian Independent director Male 61 Incumbent 12 No
Yu Xingxi Independent director Male 64 Incumbent 0 No
Liu Shen Independent director Male 47 Incumbent 12 No
Peng Feng Independent director Male 43 Incumbent 0 No
Supervisory board
Sun Yi Male 57 Incumbent 0 No
chairman
Guo Liyan Supervisory Female 47 Incumbent 0 No
Chang Haiyu Supervisory Female 38 Incumbent 0 Yes
Employee representative
Wang Xingtao Male 44 Incumbent 0 No
supervisor
Employee representative
Qu Erlong Male 41 Incumbent 25.79 No
supervisor
Liu Jianhui General manager Male 57 Incumbent 89.43 No
Zhang Binglong Vice general manager Male 46 Incumbent 8.83 No
43
Beijing Shougang Co. Ltd Annual Report 2022
Total pretax Whether to get remuneration
Name Position Gender Age Status of employment remuneration received from related parties of the
from the company company
Li Baizheng Chief accountant Male 57 Incumbent 80.83 No
Sun Maolin Vice general manager Male 46 Incumbent 81.01 No
Li Jingchao Vice general manager Male 57 Incumbent 81.45 No
Vice general manager/
Chen yi Male 55 Incumbent 74.19 No
secretary of the Board
Xie Tianwei Vice general manager Male 41 Incumbent 7.78 No
Wang Kai Vice general manager Male 40 Incumbent 7.29 No
Qiu Yinfu Director Male 55 Dismissed 66.72 Yes
Yin Tian Independent director Male 68 Dismissed 0 No
Yang Mulin Supervisory Male 51 Dismissed 0 Yes
Employee representative
Cui Aimin Female 54 Dismissed 23.62 No
supervisor
Peng Kaiyu Vice general manager Male 42 Dismissed 57.48 No
Li Ming Vice general manager Male 48 Dismissed 75.73 No
Ma Jiaji Chief engineer Male 59 Dismissed 138.14 No
Total -- -- -- -- 866.81 --
VI. Performance of Directors during the reporting period
1. Board meetings during the reporting period
Meeting Convening date Disclosure date Resolutions of meeting
Detailed information can be found in the company's
The seventh meeting of the twelfth session of
February 28, 2022 March 1, 2023 announcement on the date of disclosure of the meeting
the Board
resolution
Detailed information can be found in the company's
The first Extraordinary General Meeting of the
March 31, 2023 April 1, 2023 announcement on the date of disclosure of the meeting
year 2022
resolution
Detailed information can be found in the company's
The seventh meeting of the thirteenth session of
April 27, 2023 April 28, 2023 announcement on the date of disclosure of the meeting
the Board
resolution
Detailed information can be found in the company's
The second Extraordinary General Meeting of
May 20, 2022 May 21, 2022 announcement on the date of disclosure of the meeting
2022
resolution
Detailed information can be found in the company's
The seventh meeting of the fourteenth session of
June 7, 2022 June 8, 2022 announcement on the date of disclosure of the meeting
the Board
resolution
Detailed information can be found in the company's
The third Extraordinary General Meeting of
August 22, 2022 August 22, 2022 announcement on the date of disclosure of the meeting
shareholders in 2022
resolution
Detailed information can be found in the company's
The fourth Extraordinary General Meeting of
September 5, 2022 September 6, 2022 announcement on the date of disclosure of the meeting
shareholders in 2022
resolution
Detailed information can be found in the company's
The fifth Extraordinary General Meeting of
October 27, 2022 October 28, 2022 announcement on the date of disclosure of the meeting
shareholders of 2022
resolution
Detailed information can be found in the company's
The eleventh meeting of the fifteenth session of
December 6, 2022 December 7, 2022 announcement on the date of disclosure of the meeting
the Board
resolution
Detailed information can be found in the company's
The sixth Extraordinary General Meeting of
December 16, 2022 December 17, 2022 announcement on the date of disclosure of the meeting
shareholders of 2021
resolution
Detailed information can be found in the company's
The eighth meeting of the first session of the
December 23, 2022 December 24, 2022 announcement on the date of disclosure of the meeting
Board
resolution
2. Attendance of Directors at Board meetings and general meetings
Attendance of Directors at Board meetings and general meetings
Number of
attendance Absent from
Attendance at Attendance at Attendance at
required for Board Absence from Board meetings Attendance at
Name of Directors Board meetings in Board meetings Board meetings
meetings during Board meetings twice in a row (in general meetings
person by communication by proxy
the reporting person)
period
44
Beijing Shougang Co. Ltd Annual Report 2022
Zhao Minge 11 4 7 0 0 No 4
Liu Jianhui 11 2 9 0 0 No 5
Zeng Li 4 0 4 0 0 No 2
Li Jiantao 1 0 1 0 0 No 1
Ye Lin 11 0 11 0 0 No 0
Gu Wenxian 11 0 11 0 0 No 0
Yu Xingxi 1 0 1 0 0 No 1
Liu Shen 11 0 11 0 0 No 0
Peng Feng 11 1 10 0 0 No 0
Qiu Yinfu 5 3 2 0 0 No 2
Wu Dongying 10 0 10 0 0 No 0
Explanation for absent from Board meetings twice in a row (in person)
Not applicable
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
Independent
Composed by 5
directors express
Strategic and Risk directors,
independent
Management including 2 0
opinions in
Committee independent
accordance with
directors.
regulations
Independent
Summary of
directors express
communication between Agreed to submit
February 28, independent
CPA and audit committee to the Board for
2022 opinions in
(independent director) review
accordance with
before audit
regulations
The communication letter
between the CPA
Composed by 3
participating in the annual
Audit Committee independent 2
report and the Independent
directors.
independent directors and directors express
Agreed to submit
the audit committee of the independent
April 8, 2022 to the Board for
board of directors after opinions in
review
issuing preliminary audit accordance with
opinions on the audit regulations
report of the company's
financial final accounts in
2021
Independent
Proposal on the general
directors express
Remuneration and Composed by 3 manager's salary cashing Agreed to submit
independent
Assessment independent 1 April 8, 2022 in 2021and the salary and to the Board for
opinions in
Committee directors. assessment distribution review
accordance with
method in 2022
regulations
Independent
Composed by 3
directors express
directors,
Nomination independent
including 2
Committee opinions in
independent
accordance with
directors.
regulations
45
Beijing Shougang Co. Ltd Annual Report 2022
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 6,374
Number of employees in the main subsidiary 12,234
Total number of employees 18,608
Total number of employees receiving salary in the current period 18,608
Number of retired employees to be borne by parent company and main
1,242
subsidiary
Professional composition
Professional composition category Number of professional composition
Production 12,619
Salesman 679
Technician 2,196
Finance 294
Administrative 2,329
Services and other 491
Total 18,608
Education background
Type Quantity
Master degree or above 1,497
Bachelor's degree 7,895
College 5,809
Vocational secondary and below 3,407
Total 18,608
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 links to
the performing duty monthly or annually, and is distributed monthly and annually in terms of the Responsible Agreement of Business
Objectives. After performance appraisal at the end of employment term according to the Responsible Agreement of Objective during
The Employment Term, the incentives bonuses to employment term will be afforded flowing the assessment results.
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
In accordance with the national and Beijing Municipal Vocational Skills Improvement action plan, combined with the overall
requirements of the construction of the workforce, Qianshun Base and Zhixin Co. take quality improvement, ability training and
talent value-added as the core, adhere to the combination of theory and practice, learning and summary, and establish the "voyage"
development system for the whole life cycle career of high-potential talents. According to the talent positioning needs of different
levels, such as training reserve, backbone, core, key and strategy, Qianshun Base and Zhixin Co. design talent development and
training projects at five levels, such as "wave, sail, set sail, pilot and pilot", to form a continuous and progressive high-potential talent
training and development map, which is continuously promoted in stages and levels. Qianshun Base and Zhixin Co. formulate a
series of talent training implementation projects according to the characteristics of talent ability and growth factors at different stages,
effectively realize the unified guidance of high-potential talent training of the three talent sequences and accelerate talent growth.
Qianshun Base and Zhixin Co. organized and completed more than 130 training programs at all levels throughout the year, realizing
full coverage of the three talent teams of operation and management, professional technology and skill operation, providing strong
support for building a team of employees with both political integrity and ability and excellent quality, and constantly enhancing
enterprise cohesion and high-quality development.
46
Beijing Shougang Co. Ltd Annual Report 2022
Jingtang Co. focuses on improving the quality and ability of the staff and continues to expand and grow into a talent platform.
Jingtang Co. establishes the correct orientation of personnel selection and employment, pays attention to practical training in
undertaking urgent, difficult and heavy tasks, holds training classes for middle management personnel and rotation training classes
for grassroots management personnel, implements "seedling" training and "hanging up" learning for young backbone, and
strengthens the construction of management personnel. Jingtang Co. gives full play to the advantages of school-enterprise joint
training, and holds the second phase of high-end compound technical personnel training class to improve the ability of professional
and technical personnel. Jingtang Co. continues to carry out skills competition and hierarchical training of team leaders to improve
the operation skills of staff. Jingtang Co. explores the differentiated training path of graduates, focuses on the "Qinglan" training plan,
and strengthens the training of reserve force.
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
1. Since the establishment, the Company highly valued the investment return for shareholders, the protection for legitimate rights and
interests of all shareholders, especially for the small and medium shareholders. According to various regulations and relevant
requirements issued by the regulatory authority, the Company timely revised and improved the provisions of the profit distribution
policy in the Articles of Association of the Company, and the standard and proportion of cash dividends shall be explicit and clarity.
2. During the reporting period, profit distribution proposal complied with the provision of profit distribution in the Articles of
Association of the Company, complied with the provisions of normative documents issued by CSRC and other regulatory agencies
and fulfilled the procedures for independent directors to issue independent opinions and legal approval.
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
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
Y
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
The Company plans not to distribute cash dividends, bonus shares or increase share capital with 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.
47
Beijing Shougang Co. Ltd Annual Report 2022
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)
Director, General
Liu Jianhui 0 0 0 0 0 3.77 290,000 0 0 290,000
manager
Zeng Li Director 0 0 0 0 0 3.77 290,000 0 0 290,000
Zhang Vice General
0 0 0 0 0 3.77 232,000 0 0 232,000
Binglong Manager
Li Baizheng Chief accountant 0 0 0 0 0 3.77 261,000 0 0 261,000
Vice General
Sun Maolin 0 0 0 0 0 3.77 261,000 0 0 261,000
Manager
Vice General
Li Jingchao 0 0 0 0 0 3.77 261,000 0 0 261,000
Manager
Vice General
Manager,
Chen Yi 0 0 0 0 0 3.77 261,000 0 0 261,000
Company
secretary
Vice General
Xie Tianwei 0 0 0 0 0 3.77 203,300 0 0 203,300
Manager
Vice General
Wang Kai 0 0 0 0 0 3.77 203,000 0 0 203,000
Manager
Total -- 0 0 0 0 -- 0 -- 2,262,300 0 0 -- 2,262,300
Notes (if any)
48
Beijing Shougang Co. Ltd Annual Report 2022
Evaluation mechanism and incentive of senior management
The general manager of the company shall implement the annual salary system (including base salary, performance-based annual
salary and term incentive). The Compensation and Appraisal Committee of the Board of Directors shall, in accordance with the
provisions, formulate the 2022 General Manager Salary Appraisal and Distribution Method and put forward the appraisal and
implementation opinions, which shall be submitted to the board of Directors for deliberation and approval before implementation.
The assessment of the deputy general manager and other senior management personnel in 2022 shall be assessed and allocated by the
general manager (and director) according to the completion of the work tasks of each senior management personnel including the
deputy general manager as authorized by the board of directors.
With the approval of Beijing State-owned Assets Supervision and Administration Commission and the approval of the general
meeting of shareholders of the Company, the Company implements restricted stock incentive for senior managers. According to the
2021 Restricted Stock Incentive Plan of Beijing Shougang Co., Ltd. (Revised Draft), the Company's 2022 annual indicators do not
meet the performance assessment conditions of the incentive plan. If 15 incentive objects no longer meet the incentive conditions due
to organizational or personal reasons, the board of Directors of the Company intends to repurchase and cancel the corresponding
restricted shares. Please refer to the relevant announcements disclosed by the company for the above repurchase cancellation matters.
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 a sound internal control system, and timely revised and improved according to the actual operation,
giving full play to its institutional guarantee role. During the reporting period, the Company formulated 48 systems including the
Board of Directors' Authorization Management System for Managers and Compliance Management System, and revised 78 systems
including the Articles of Association and Rules of Procedure of the Board of Directors. By the end of the report period, the Company
has 529 systems, among which 516 systems are formulated and implemented by the company and 13 systems are forwarded to the
government and regulatory authorities.
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
21 April 2023
evaluation report
Disclosure index of full internal control Beijing Shougang Co., Ltd. 2022 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
99.22%
accounting for the total assets in the
consolidated financial statements
Proportion of operating revenue
included in internal control evaluation
99.99%
report accounting for operating revenue
in the consolidated financial statements
Defect identification criteria
Type Financial Reports Non-financial reporting
1. General deficiency: it may 1. General deficiency: it may or has temporarily affected
or has caused slight impact on the health of employees or the public; may or has caused
business activities, which is slight impact on business activities, which is not an
not an objective reason and objective reason and has exceeded the budget by 1% - 5%
has exceeded the budget by in terms of time, manpower or cost without proper
1% - 5% in terms of time, approval; negative news may or has caused slight impact
Qualitative criteria
manpower or cost without on the company, spreading within the company or locally,
proper approval; and will not attract the attention of stakeholders; violation
2. Significant deficiency: it of the company or relevant rules and regulations or
may or has slowed down the conflict with self-made rules and regulations may have
business operation, or unable caused slight social impact, basically will not lead to the
to achieve some business attention of regulators.
49
Beijing Shougang Co. Ltd Annual Report 2022
objectives, or not exceeding 2. Significant deficiency: it may or has had a negative
the budget by 6% - 20% in impact; it may or has seriously affected the health of many
terms of time, manpower or employees or the public, or caused general environmental
cost for non-objective reasons damage, and the situation needs external support to be
and without proper approval; controlled; may or has slowed down the business
3. Material deficiency: (1) it operation, or unable to achieve some business objectives,
may or has made the company or not exceeding the budget by 6% - 20% in terms of time,
unable to achieve all operating manpower or cost for non-objective reasons and without
objectives, resulting in proper approval; the negative news may or has caused a
business suspension. It is not greater impact on the company, and disseminates in a
an objective reason and has certain region It has attracted the attention of relevant
exceeded the budget by more stakeholders, such as the suspension of cooperation by
than 20% in terms of time, partners, low efficiency of employees, reduction of
manpower or cost without customer loyalty, etc.; it has violated national and regional
proper approval, and has laws and regulations or industry norms, faced with legal
exceeded the level of proceedings, economic compensation, which may or has
importance; (2) The company caused general social impact, attracted the attention of
has financial related fraud, regulatory agencies, and required regular rectification.
which affects the accuracy of 3. Material deficiency: there is causing casualties of many
financial statements. employees and local residents, causing serious damage to
the environment and out of control of the situation; may or
has made the company unable to achieve all operating
objectives, resulting in business suspension. It is not an
objective reason and has exceeded the budget by more
than 20% in terms of time, manpower or cost without
proper approval, and has exceeded the level of importance;
the negative information may or has caused significant
impact on the company, which is widely spread, causing
significant damage to the reputation of the enterprise. The
government or regulatory authorities conduct
investigation, causing public concern and irreparable
damage to the reputation of the enterprise; violating laws
and regulations, in the face of business suspension, legal
proceedings or economic compensation,; it may or has
caused serious social impact; it has been notified or
publicly condemned by regulatory authorities, or even
ordered to suspend business for rectification.
1. General misstatement:
amount of misstatement <
0.5% of total assets 1. General misstatement: RMB 100,000≤amount of direct
2. Significant misstatement: loss < RMB 5,000,000
0.5% of total assets≤amount 2. Significant misstatement: RMB 5,000,000≤ amount of
Quantitative criteria
of misstatement < 1% of total direct loss < RMB 10,000,000
assets 3. Material misstatement: RMB 10,000,000≤ amount of
3. Material misstatement: 1% direct loss
of total assets≤amount of
misstatement
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 2022, in
accordance with the “Basic Standards for Internal Control of Enterprises” and other relevant regulations.
50
Beijing Shougang Co. Ltd Annual Report 2022
Disclosure of internal control audit
Disclosed
report
Date of disclosure of the internal
21 April 2023
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 unqualified opinion 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.
51
Beijing Shougang Co. Ltd Annual Report 2022
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
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.
Administrative license for environmental protection
During the reporting period, Qiangang Co. successively completed the transformation project of steel slag production line pressing
ball line drying equipment and the EIA approval work of nine general decline project, which ensured the compliance of
environmental protection projects in accordance with the law. In September 2017, Qiangang Co. obtained a new version of sewage
discharge permit issued by Tangshan Ecological Environment Bureau of Hebei Province. In November 2022, Qiangang Co. extended
the sewage discharge permit and obtained a new version of the sewage discharge permit, which is valid unti 29l November 2027.
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
2023, the permit was renewed again, this time extending until February 2028.
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. In August 2022, Zhixin Co. went through the procedures for changing the sewage discharge permit, which is valid
until July 2026. In July 2022, Zhixin Co. completed the approval procedures for the environmental impact report form of the
construction project of the environmental protection capacity improvement project of the wastewater station.
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.
52
Beijing Shougang Co. Ltd Annual Report 2022
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 Wastewater discharge port 3.64mg/L 50mg/L 1.5596 648.399 No
Ammonia
Qiangang Co. Water pollutant Direct 1 Wastewater discharge port 0.197mg/L 5mg/L 0.086025 64.899 No
Nitrogen
Sintering, pelletizing <
Power station boiler chimney, sintering machine
9.54mg/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 32 CCPP combustion exhaust gas, blast furnace hot 883.6218 1698.055 No
heating furnace, lime kiln < lime kiln < 50mg/m power generation <
blast furnace outlet, steel rolling heating furnace
24mg/m power generation < 35mg/m
outlet, white ash kiln roof, sleeve kiln roof
22mg/m
Power station boiler chimney, sintering machine Sintering, pelletizing <
Sintering, pelletizing < 50mg/m blast furnace
head flue gas outlet, pellet roasting flue gas outlet, 38mg/m blast furnace hot blast
hot blast furnace, rolling steel heating furnace,
Qiangang Co. Air pollutants Nitrogen Oxides Organized 32 CCPP combustion exhaust gas, blast furnace hot furnace, rolling steel heating 1545.339 3493.843 No
lime kiln < 150mg/m power generation <
blast furnace outlet, steel rolling heating furnace furnace, lime kiln < 34mg/m
100mg/m
outlet, white ash kiln roof, sleeve kiln roof power generation < 33mg/m
Power station boiler chimney, sintering machine
head flue gas outlet, pellet roasting flue gas outlet, Sintering, pelleting < 3.5mg/m
blast furnace iron field dust removal, blast furnace blast furnace hot blast furnace, Sintering, pelletizing < 10mg/m blast furnace
silo dust removal, steelmaking converter secondary rolling steel heating furnace, hot blast furnace, rolling steel heating furnace,
Qiangang Co. Air pollutants Particulate Matter Organized 129 2036.834 2524.85 No
dust removal, converter primary dust removal, lime kiln, other environment < lime kiln < 10mg/m power generation <
CCPP combustion exhaust gas, hot rolling heating 7.5mg/m power generation < 5mg/m
furnace exhaust gas, environmental dust removal, 4mg/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 42 furnace, lime kiln < 25mg/m lime kiln < 50mg/m coke oven flue gas < 2022.4 2965.74 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 38 heating furnace, lime kiln < lime kiln < 150mg/m coke oven flue gas < 5231.9 6379.92 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
53
Beijing Shougang Co. Ltd Annual Report 2022
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 176 lime kiln < 10mg/m coke oven flue gas < 2745.5 4330.44 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 5.048 45 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 33.978 131.649 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 16.31 19 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 8.36-15.93 mg/m3 30mg/m 21.345 67.5 No
Ammonia
Cold-R Co. Water pollutant Organized 1 Wastewater stations 0.01-0.71 mg/m3 1.5(2.5) mg/m3 0.1681 3.937 No
Nitrogen
Furnace and dust removal chamber: 20
Cold-R Co. Air pollutants Sulfur Dioxide Organized 8 Around the plant 3 mg/m3 3.8524 18 No
mg/m3； boiler room: 10 mg/m3
Furnace and dust removal
Furnace and dust removal chamber: 100
Cold-R Co. Air pollutants Nitrogen Oxides Organized 8 Around the plant chamber: 1-97 mg/m3； boiler 49.326 99.58 No
mg/m3； boiler room: 80 mg/m3
room: 1-79 mg/m3
Furnace and dust removal 3
Furnace and dust removal chamber:10 mg/m ；
Cold-R Co. Air pollutants Particulate Matter Organized 10 Around the plant chamber: 1-9 mg/m3； boiler 18.5014 18.75 No
boiler room: 5 mg/m3
room: 1-4.43 mg/m3
54
Beijing Shougang Co. Ltd Annual Report 2022
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, 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.
Zhixin Co. continues to promote pollutant emission reduction. According to the "Green project" transformation plan, Zhixin Co. has
completed the denitrification transformation of source treatment project CA1/2/4, which effectively reduces nitrogen oxide emissions.
Zhixin Co. reached the ultra-low emission standard of Hebei Province, thanks to the continuous environmental protection capacity
improvement project. According to the requirements, Zhixin Co. has completed the networking of 5 video monitoring systems and 3
CEMS, which provides data support for improving the level of environmental protection management.
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.
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 2022, and strictly implemented it. In 2022, 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 2022. 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 2022, and forms monitoring data and reports at the same time. The
monitoring plan for 2022 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 2022, 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 2022, Zhixin Co. carried out self-monitoring 75 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 weekly, 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 2022.
Contingency plan
No ecological and environmental emergencies occurred in the Company and its holding subsidiaries in 2022.
In accordance with the Environmental Protection Law of the People's Republic of China and other laws, regulations, rules and
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
55
Beijing Shougang Co. Ltd Annual Report 2022
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 2022, 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 2022, Zhixin Co. mainly conducted drills for
acid leakage, gas leakage and other risk points. 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. According to the plan, Cold-R Co. organizes drills in each workshop every year according to the
requirements of the plan, through which problems are found and rectifies in time, which enhances Cold-R Co.'s ability to deal with
environmental emergencies.
Environmental protection input and environmental protection tax
During the reporting period, Qiangang Co. continued to implement 29 continuous improvement projects such as flue gas treatment of
blast furnace hot blast furnace, increase of denitration facilities for heating furnace of hot rolling section, denitration improvement of
three-fired particulate matter emission and desulfurization ash transformation, new electric dust removal and fan for the primary line
of desulfurization in recycling industrial park, with an annual investment of RMB785 million. In 2022, Qiangang Co. paid
RMB10.2702 million of environmental protection tax, with a reduction of RMB5.8853 million.
Jingtang Co. promoted the implementation of 13 key environmental protection and deep treatment projects, including hot rolling
furnace desulfurization, blast furnace hot blast furnace flue gas denitrification, and sleeve kiln flue gas denitrification, with the
annual investment of RMB 436 million. In 2022, RMB23.21 million of environmental protection tax was paid, with a reduction of
RMB9.4064 million.
Zhixin Co. effectively reduced pollutant emissions by increasing environmental protection treatment facilities, with an annual
investment of RMB9.8 million. In 2022, RMB759,100 was paid for environmental protection tax, with a reduction of RMB143,800.
Cold-R Co. actively promoted environmental management and protection work, with an annual investment of RMB52.636 million.
In 2022, RMB698,300 was paid for environmental protection tax, with a reduction of RMB207,400.
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 the company, the Company scientifically and standardized
to promote the development of "carbon management" activities, the company organized the preparation of Shougang Low-carbon
Action Plan and Shougang Low-carbon Development Organization Implementation Plan, including the formulation of phased goals,
clear realization path and determined the schedule and roadmap. This undoubtedly accelerated the company to build a green and
low-carbon development pattern. The company actively carries out carbon reduction tests, builds LCA basic models for carbon
reduction technology, and carries out carbon reduction effect accounting. The Company has completed the environmental product
statement (EPD) report and release of hot rolled steel plate and steel strip products in two bases, which strongly supports the green
manufacturing of products. The Company started the third-party low-carbon certification work in response to the policies related to
the carbon border adjustment mechanism.
Jingtang Co. focuses on the implementation of the "dual carbon" strategy and actively promotes the clean development of energy
structure. Jingtang Co. continues to strengthen the basic capacity construction of carbon management, vigorously promote the green
upgrading of low-carbon process, steadily layout revolutionary deep decarbonization technology research, simultaneously promote
process carbon reduction and source carbon reduction, and enter the green electricity market transaction and purchase green
electricity for the first time. To meet customers' carbon reduction needs, Jingtang Co. has steadily promoted the construction of LCA
system, released EPD of weathering steel, completed the application of green products of key brands such as high-strength steel, and
created a brand image of green manufacturing.
Zhixin Co. focuses on the implementation of the "dual carbon" strategy and actively promotes the clean development of energy
structure. Zhixin Co. continues to strengthen the basic capacity construction of carbon management, promote the transformation of
burner and SCR, vigorously promote the green upgrading of low-carbon process, and steadily layout revolutionary deep
decarbonization technology. Zhixin Co. simultaneously promotes process carbon reduction and source carbon reduction, and actively
promotes green electricity use and photovoltaic construction. In 2022, photovoltaic power generation was 2,594,800kwh. To meet
customers' carbon reduction needs, Zhixin Co. has steadily promoted the construction of LCA system, completed the green design
product application of two series of non-oriented electrical steel and oriented electrical steel for new energy vehicles and obtained
national recognition, and created 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. By adjusting the product structure in 2022, Cold-R Co. increased the proportion of high
value-added products and further reduced energy consumption, meanwhile, the carbon emissions decreased by 4.3% year-on-year
through such as market procurement of green electricity and photovoltaic power generation and other measures.
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
56
Beijing Shougang Co. Ltd Annual Report 2022
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.
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. monitor
and manage the national pollution source information and sharing platform and the website of the government environmental
protection department, as well as establish the information publication platform by themselves. This propagates and displays
environmental protection information such as enterprise environmental protection projects, operation of environmental protection
facilities, name and emissions of main pollution sources, monitoring methods, name of monitoring indicators, comprehensive
utilization of solid waste and so on. This is one of the ways that the company takes the initiative to accept social supervision.
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 2022, the Company's website (http://www.sggf.com.cn) released the 2021 Annual Environmental
Responsibility Report of Beijing Shougang Co., Ltd.
II.Social responsibility
The Company independently prepared the 2022 annual social responsibility report and submit it to the second board meeting of the
eighth session for deliberation. Please refer to the company announcement on 21 April 2023 for details.
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 Appointing the First
Secretary and Task Force to Key Villages, the deployment of the Organization Department of the Party Committee of Beijing
Municipal Committee and the deployment of the State-owned Assets Supervision and Administration Commission of Beijing, and the
arrangement of the Organization Department of the Party Committee of Shougang Group Co., Ltd., the Company and Jingtang Co.
each appoint a staff member to serve as the first secretary of the collective economically weak villages of Beijing. Under the
leadership of the local Party committee and government, they conscientiously performed 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 2022, the Company purchased RMB3.387 million of agricultural
materials for poverty alleviation in paired assistance areas.
57
Beijing Shougang Co. Ltd Annual Report 2022
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.
58
Beijing Shougang Co. Ltd Annual Report 2022
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:
Shougang 1. The company promises to urge Jingtang Co. not to actually carry Refer to
Group Co., out port operation business of general bulk cargo berth project 29 Sep. 2015 contents of Implementing
Ltd. (552-meter shoreline wharf project) without obtaining formal or commitment
temporary port operation license.
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
Jingtang Caofeidian Port Co., Ltd. (hereinafter referred to as Port
Company) to complete relevant matters:
1. Shougang Group promises to urge Jingtang Co. to complete the
Shougang Refer to
overall acceptance procedures of supporting wharf project
Group Co., 23 Dec. 2022 contents of Implementing
(1240-meter shoreline wharf project) and obtain the formal port
Ltd. commitment
operation license before 31 December 2022, and carry out port
operation business in accordance with the requirements of relevant
competent departments.
2. Shougang Group promises to urge Jingtang Co. to complete the
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
complete the relevant matters of obtaining land use right certificate:
Shougang
The company promises to urge Jingtang Co. to obtain state-owned
Group Co., 31 Dec. 2023 Implementing
land use right certificate of all the land used before 31 December
Ltd.
2023, including but not limited to the land used by Jingtang Co. Phase
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.
59
Beijing Shougang Co. Ltd Annual Report 2022
1. When the company obtains the shares of the listed company through
the issuance of shares to purchase assets, if the equity interests of
Jingtang Co. held by the company have reached 12 months, the shares
of the listed company acquired by the company in this transaction
shall not be traded or transferred in any way within 12 months from
the end of the issuance of shares; If the equity interests of Jingtang Co. The performance has
held by the company are less than 12 months, the shares of the listed been completed.
Beijing company acquired by the company in this transaction shall not be
Jingtou The restricted shares
transferred within 36 months from the date of the end of share held by Beijing Jingtou
Investment issuance. If such shares are increased due to the listed company's 21 May. 2021 20 May. 2022 Investment Holding
Holding Co., granting of bonus shares, conversion of capital stock and other
Ltd. Co., Ltd. were lifted
reasons, the additional shares of the listed company shall be locked in from the restriction on
accordance with the above lockup period. May 23, 2022
2. If the aforementioned commitment to lock up shares is inconsistent
with the latest regulatory opinions of the securities regulatory
authorities, the company will adjust the aforementioned commitment
according to the regulatory opinions of the relevant securities
regulatory authorities.
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.
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.2021 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
Ltd. 2022 have been fulfilled
commitment assets in the current period shall be no less than RMB
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
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. Opinions of the Directors regarding the latest modified auditor’s report
□ Applicable √ Not applicable
60
Beijing Shougang Co. Ltd Annual Report 2022
V. Explanation from board of directors, supervisory committee and independent directors (if
applicable) for 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
Please refer to Section X, Changes in Significant Accounting Policies and Estimates for details.
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
Please refer to Section X, Changes in the Scope of Consolidation for details.
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) 23
Name of domestic CPA Qian Bin, Yu Qike
Continuous life of auditing service for domestic accounting firm (year) 5
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 2022.
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 1 April
its 4,968,948 6,233,440 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, Cash at
Parent Related Market Market Market 1 April
Group and solid 290,163 442,928 N bank and Ditto
company sales price price price 2022
its waste, on hand
61
Beijing Shougang Co. Ltd Annual Report 2022
subsidiarie power
s energy, etc
Raw fuel,
power
Other Joint Cash at
Related energy, Market Market Market 1 April
related venture and 2,689,401 2,504,924 N bank and Ditto
purchase production price price price 2022
parties associates on hand
services,
etc
Other Joint Steel, Cash at
Related Market Market Market 1 April
related venture and power 402,571 532,738 N bank and Ditto
sales price price price 2022
parties associates energy, etc on hand
Total -- -- 8,351,083 -- 9,714,030 -- -- -- -- --
Details of large sales returns No
The Company estimates the daily related Party transactions to occur based on the total amount. The Proposal on the Daily Related
The Company classifies the daily related
Party Transactions in January-February 2022 and the Expected Daily Related Party Transactions in 2022 was deliberated and approved
transactions by category and estimates the
by the first interim meeting of the Board of Directors of the Company in 2022 on March 31, 2022, and submitted to the company's
transaction amount that will take place in the
2021 Annual General Meeting of shareholders on June 29, 2022 for approval. The total amount of transactions approved by the general
current period, and discloses the actual
meeting of shareholders in the current period was RMB 9,7140.3 million, and RMB 8,3510.83 million occurred in the current period,
transaction amount (if any)
which did not exceed the approved quota. For details of the related parties and related party transactions, please refer to Section X.
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
Evaluation
Carry value Related Profit or loss
Pricing value of
Related Transaction Transaction of assets Tranfer price transaction of the Date of
Relationship principle of assets Disclosure index
parties type content transferred (RMB’0,000) settlement transaction disclosure
transaction transferred
(RMB’0,000) methods (RMB’0,000)
(RMB’0,000)
Purchase 49%
equity of Steel "China Securities
The
Trading Co. Journal" ,"Securities
Shougang controlling Issue shares
Asset held by Evaluation 19 March Times" ,"Shanghai
Group Co., shareholder 527,388.42 585,895.82 585,895.82 to purchase 0
purchase Shougang price 2022 Securities News", Juchao
Ltd. of the assets
Group Co., Information Network
Company
Ltd. by issuing (http://www.cninfo.com.cn)
shares
Acquisition of "China Securities
The
pellet-sintering Journal" ,"Securities
Shougang controlling 16
Asset assets held by Evaluation Cash Times" ,"Shanghai
Group Co., shareholder 105,815.03 130,032.58 130,032.58 0 November
purchase Shougang price purchase Securities News", Juchao
Ltd. of the 2022
Mining Corp. Information Network
Company
for cash (http://www.cninfo.com.cn)
The reason for the material difference between the
transfer price and the carrying value or evluation value Not applicable
(if applicable)
(1) The transaction of "Purchasing 49% equity of Steel Trading Company held by Shougang Group Co., Ltd. by issuing shares"
aims to fulfill the commitment of Shougang Group to build Shougang Shares into the only listing platform of the group's steel
sector, realize the agglomeration of main steel assets of Shougang Shares, and improve the overall profitability. Through this
transaction, the independence of listed companies can be further enhanced in terms of equity structure, the control and
decision-making efficiency of listed companies over subsidiaries can be improved, so as to better realize the optimal allocation
of resources within the listed company system, and ensure the long-term steady development of the main steel industry of listed
Impact on the operation results and financial position of
companies.
the Company
(2) The transaction of "Acquisition of pellet-sintering assets held by Shougang Mining Corp. for cash." is to fulfill the
commitment made by Shougang Group during the material assets restructuring of Shougang Shares in 2014. After the
completion of this related party transaction, the related party transaction between Shougang Shares and Shougang Group will
be effectively reduced, the coordination of the whole process of the company will be strengthened, the steel production process
will be more perfect, which will help improve the management efficiency and enhance the overall profitability and
comprehensive strength of the Company.
Performance achievement during the reporting period if
thtere is any performance agreement attached in related Not applicable
transaction
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 Beginning Closing
Range of deposit balance balance
Related party with the deposit limit Total deposit amount Total withdrawal
interest rate
Company (RMB’0,000) (RMB’0,000) of current period amount of current (RMB’0,000)
(RMB’0,000) period (RMB’0,000)
62
Beijing Shougang Co. Ltd Annual Report 2022
Under the
Shougang
control of the
Group Finance 1,600,000 1.40%-2.05% 999,359.98 16,634,650.5 16,755,744.15 878,266.33
same parent
Co., Ltd.
company
Loan
Current amount
Relationship Beginning Closing
Amount Loan interest
Related party with the balance Total loan amount of Total repayment balance
(RMB’0,000) rate range
Company (RMB’0,000) current period amount of current (RMB’0,000)
(RMB’0,000) period (RMB’0,000)
Under the
Shougang
control of the
Group Finance 3,200,000 2.35%-4.05% 1,598,419.9 2,312,109.54 2,108,840.02 1,801,689.43
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 3,200,000 1,801,689.43
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.
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) 20
joint and
Steel 8 June 2022 21,000 September 18,200 One year No Yes
several
Industry Co., 2022
liability
Ltd.
Ningbo Guarantee of
Shougang 29 August joint and
8 June 2022 4,400 2,400 One year No Yes
Zhejin Steel 2022 several
Co., Ltd. liability
Total external guarantees Total actual external
approved during the 25,400 guarantees during the 20,600
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 20,600
reporting period (A3) the reporting period (A4)
Guarantees between the Company and its subsidiaries
63
Beijing Shougang Co. Ltd Annual Report 2022
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 8 June 2022 16,050 0 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 0
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 0
approved as at the end of the as at the end of the
reporting period (B3) reporting period (B4)
Guarantees between 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
Total amount of guarantee provided (i.e. sum of the above three guarantee amount)
Total amount of guarantee
Total amount of guarantee
approved during the
41,450 during the reporting period 20,600
reporting period
(A2+B2+C2)
(A1+B1+C1)
Total amount of guarantee Total balance of guarantee
approved as at the end of the as at the end of the
41,450 20,600
reporting period reporting period
(A3+B3+C3) (A4+B4+C4)
The percentage of total amount of guarantee provided
0.43%
(i.e. A4+B4+C4) to the net assets of the Company
Including:
Explanation of the specific situation of using composite guarantee
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
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
On March 18, 2022, the Company received the reply of Approval for Beijing Shougang Co., Ltd. to issue shares to Shougang Group
Co., Ltd. to purchase assets and raise supporting funds (CSRC License [2022] No. 553) issued by China Securities Regulatory
Commission.
On April 20, 2022, the Company completed the issuance of 1,015,417,369 shares to Shougang Group Co., Ltd. to purchase the
remaining 49% equity of Beijing Shougang Steel Trading Investment Management Co., Ltd. On June 7, 2022, the Company
completed the issuance and listing of 54,126,391 non-publicly offering shares with supporting raised funds. The total share capital of
the Company increased to 7,819,869,170 shares.
XVII. Significant matters of subsidiaries of the Company
√ Applicable □ Not applicable
1. In April 2022, Zhixin Co. and New-E Co. and its wholly-owned subsidiary Shougang Qian'an New Energy Automobile Electrical
Steel Co., Ltd. (hereinafter referred to as "Qian'an Electrical Steel") signed the "Absorption and Merger Agreement between
Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd., Shougang Qian'an New Energy Automobile Electrical Steel Co., Ltd.,
and Beijing Shougang New Energy Automobile Material Technology Co., Ltd.". The agreement stipulates the relevant content of
zhixin electromagnetic absorption and Qian'an Electrical Steel. After the completion of the merger, the New-E Co. becomed the
shareholder of Zhixin Electromagnetic, with the equity ratio of 8.9042%, and the equity ratio of Zhixin Co. held by the Company
changed to 75.3989%.
64
Beijing Shougang Co. Ltd Annual Report 2022
2. 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. After the completion of the project, the
Company holds 68.0293% of the shares of Zhixin Co.
65
Beijing Shougang Co. Ltd Annual Report 2022
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 1,693,222,164 25.08% 1,069,543,760 -956,202,095 113,341,665 1,806,563,829 23.10%
1. State ownership
2. State-owned
1,467,185,339 21.74% 1,015,417,369 -740,940,679 274,476,690 1,741,662,029 22.27%
corporation shares
3. Shares held by
other domestic 190,420,387 2.82% 54,126,391 -179,644,978 -125,518,587 64,901,800 0.83%
investors
Of which:
Shares held by
125,518,587 1.86% 54,126,391 -179,644,978 -125,518,587
domestic legal
persons
Shares held
by domestic natural 64,901,800 0.96% 64,901,800 0.83%
persons
4.Foreign
35,616,438 0.53% -35,616,438 -35,616,438
ownership
Of which:
Shares held by
35,616,438 0.53% -35,616,438 -35,616,438
overseas legal
persons
Shares held
by overseas natural
persons
II. Non-restricted
5,057,103,246 74.92% 956,202,095 956,202,095 6,013,305,341 76.90%
shares
1. RMB ordinary
5,057,103,246 74.92% 956,202,095 956,202,095 6,013,305,341 76.90%
shares
2. Domestic listed
foreign shares
3. Overseas listed
foreign shares
4.Others
III. Total number of
6,750,325,410 100.00% 1,069,543,760 1,069,543,760 7,819,869,170 100.00%
shares
Reasons of shares movements
√Applicable □ Not applicable
Beijing Shougang Co., Ltd. issued shares to purchase assets and raised supporting funds according to the "Reply on Approval for
Beijing Shougang Co., Ltd. to issue shares to Shougang Group Co., Ltd. to purchase assets and raise supporting funds" issued by
China Securities Regulatory Commission (CSRC License [2022] No. 553). As of the close of market on 19 April 2022, the company
purchased 1,015,417,369 shares issued by Shougang Group Co., Ltd. holding 49% equity of Beijing Shougang Steel Trading
Investment Management Co., Ltd. and registered them in the account, which were listed on 20 April 2022; As of the close of the
market on 6 June 2022, 54,126,391 non-publicly offering shares of the Company's supporting funds have been registered and listed
on 7 June 2022.
Approval of share movements
√ Applicable □ Not applicable
On 18 March 2022, the Company received the reply of Approval for Beijing Shougang Co., Ltd. to issue shares to Shougang Group
Co., Ltd. to purchase assets and raise supporting funds (CSRC License [2022] No. 553) issued by China Securities Regulatory
Commission, and the Company completed the work of purchasing assets by issuing shares and raising supporting funds accordingly.
Transfer of shares arising from changes in shareholding
□ Applicable √ Not applicable
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
66
Beijing Shougang Co. Ltd Annual Report 2022
√ Applicable □ Not applicable
During the reporting period, after the Company completed the above issuing shares to purchase assets and raising supporting funds,
the earnings per share and net asset per share of the Company during the reporting period and the latest period has been diluted due to
the expansion of the total share capital of the Company.
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 commitment made by Shougang
Group when the Company was first
restructured. For details, please refer to
the company's announcements in "China The restriction can
Securities Journal" "Securities Times" be lifted after the
Shougang Group
232,286,354 1,015,417,369 0 1,247,703,723 "Shanghai Securities News", CNINFO performance of the
Co., Ltd.
(http://www.cninfo.com.cn)on 28 commitment;
September 2019. 19 April 2025
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
announcement issued by the Company on
Beijing Jingtou
20 May 2021.
Investment 740,940,679 0 740,940,679 0 23 May 2022
Share lock up commitment made as the
Holding Co., Ltd.
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.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
funds, the transfer the shares within 6
Shanxi Coking
months after the completion of the issue
Coal Group 39,138,943 0 39,138,943 0 5 January 2022
is prohibited according to relevant
Finance Co., Ltd.
regulations.
For details, please refer to the relevant
announcement issued by the Company on
2 July 2021.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
Qingdao funds, the transfer the shares within 6
Haidayuan months after the completion of the issue 5 January 2022;
39,138,943 18,587,360 57,726,303 0
Procurement is prohibited according to relevant 7 December 2022
Service Co., Ltd. regulations.
For details, please refer to the relevant
announcement issued by the Company on
2 July 2021 and 2 June 2022.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
funds, the transfer the shares within 6
months after the completion of the issue
UBS AG 35,616,438 0 35,616,438 0 5 January 2022
is prohibited according to relevant
regulations.
For details, please refer to the relevant
announcement issued by the Company on
2 July 2021.
67
Beijing Shougang Co. Ltd Annual Report 2022
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
As the subscriber of the non-public
offering of shares issued by the company
Shanghai Blueink
to purchase assets and raise supporting
Investment
funds, the transfer the shares within 6
Management Co.,
months after the completion of the issue
Ltd.-Blueink 19,569,471 0 19,569,471 0 5 January 2022
is prohibited according to relevant
exclusive No. 5
regulations.
private equity
For details, please refer to the relevant
investment fund
announcement issued by the Company on
2 July 2021.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
funds, the transfer the shares within 6
Shanghai C&D months after the completion of the issue
9,784,735 0 9,784,735 0 5 January 2022
Material Co., Ltd. is prohibited according to relevant
regulations.
For details, please refer to the relevant
announcement issued by the Company on
2 July 2021.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
Qianhe Capital
funds, the transfer the shares within 6
Management Co.,
months after the completion of the issue
Ltd.-Yun Jin No. 2 6,007,827 0 6,007,827 0 5 January 2022
is prohibited according to relevant
private equity
regulations.
investment fund
For details, please refer to the relevant
announcement issued by the Company on
2 July 2021.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
Qianhe Capital
funds, the transfer the shares within 6
Management Co.,
months after the completion of the issue
Ltd.-Yun Jin No. 3 6,007,827 0 6,007,827 0 5 January 2022
is prohibited according to relevant
private equity
regulations.
investment fund
For details, please refer to the relevant
announcement issued by the Company on
2 July 2021.
As the subscriber of the non-public
offering of shares issued by the company
Shanghai Boshen to purchase assets and raise supporting
Investment LP- funds, the transfer the shares within 6
Boshen No. 21 months after the completion of the issue
5,870,841 0 5,870,841 0 5 January 2022
securities is prohibited according to relevant
investment private regulations.
equity fund For details, please refer to the relevant
announcement issued by the Company on
2 July 2021.
As the subscriber of the non-public
offering of shares issued by the company
Xin'an Growth to purchase assets and raise supporting
Investment funds, the transfer the shares within 6
Partnership(LP) months after the completion of the issue
0 3,717,472 3,717,472 0 7 December 2022
No.9 private is prohibited according to relevant
equity investment regulations.
fund For details, please refer to the relevant
announcement issued by the Company on
2 June 2022.
As the subscriber of the non-public
offering of shares issued by the company
Xin'an Growth to purchase assets and raise supporting
Investment funds, the transfer the shares within 6
Partnership(LP) months after the completion of the issue
0 3,717,472 3,717,472 0 7 December 2022
No.1 private is prohibited according to relevant
equity investment regulations.
fund For details, please refer to the relevant
announcement issued by the Company on
2 June 2022.
68
Beijing Shougang Co. Ltd Annual Report 2022
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
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
funds, the transfer the shares within 6
Zhong Ou Asset
months after the completion of the issue
Management 0 6,505,576 6,505,576 0 7 December 2022
is prohibited according to relevant
Company Limited
regulations.
For details, please refer to the relevant
announcement issued by the Company on
2 June 2022.
As the subscriber of the non-public
offering of shares issued by the company
Sunshine Asset -
to purchase assets and raise supporting
Industrial and
funds, the transfer the shares within 6
Commercial Bank
months after the completion of the issue
of China - actively 0 3,717,472 3,717,472 0 7 December 2022
is prohibited according to relevant
allocate No. 2
regulations.
asset management
For details, please refer to the relevant
product
announcement issued by the Company on
2 June 2022.
As the subscriber of the non-public
Huashi Haorui
offering of shares issued by the company
(Wuhan) Asset
to purchase assets and raise supporting
Management Co.,
funds, the transfer the shares within 6
Ltd. - Wuhan Hua
months after the completion of the issue
Shijinhong Private 0 7,434,944 7,434,944 0 7 December 2022
is prohibited according to relevant
Equity Investment
regulations.
Fund Partnership
For details, please refer to the relevant
(Limited
announcement issued by the Company on
Partnership)
2 June 2022.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
funds, the transfer the shares within 6
Lord Abbert China
months after the completion of the issue
Asset Management 0 3,754,646 3,754,646 0 7 December 2022
is prohibited according to relevant
Co., Ltd.
regulations.
For details, please refer to the relevant
announcement issued by the Company on
2 June 2022.
As the subscriber of the non-public
offering of shares issued by the company
to purchase assets and raise supporting
funds, the transfer the shares within 6
Caitong Fund
months after the completion of the issue
Management Co., 0 6,691,449 6,691,449 0 7 December 2022
is prohibited according to relevant
Ltd.
regulations.
For details, please refer to the relevant
announcement issued by the Company on
2 June 2022.
The restricted
shares granted will
Shougang In accordance with relevant regulations, be restricted for 24,
Directors, senior the Company's 2021 restricted stock 36 and 48 months
executives and incentive plan will arrange the lock-up from the date of
other equity 64,901,800 0 0 64,901,800 period of the restricted stock grants. registration of the
incentive objects For details, please refer to the relevant grant, i.e., 24
(386 persons in announcement issued by the Company on December 2023, 24
total) 13 November 2021. December 2024 and
24 December 2025,
respectively.
Total 1,693,222,164 1,069,543,760 956,202,095 1,806,563,829 -- --
II. Securities issuance and listing
1. Security offering (without preferred stock) in reporting period
√ Applicable □ Not applicable
69
Beijing Shougang Co. Ltd Annual Report 2022
Name of Stock
Approved Termination
and derivative Issue price Disclosure
Issue date Issue amount Listing date amount for date for Disclosure index
securities (interest) date
listing trading
thereof
Stock
For details, please refer to
"Beijing Shougang Co., Ltd.
's Implementation of Issuing
Shares to Purchase Assets
and Raising Supporting
Ordinary RMB 5.77 20 April 19 April
7 April 2022 1,015,417,369 1,015,417,369 Funds and Related Party
A-share per share 2022 2022
Transactions & Listing
Notice of Newly Added
Shares" disclosed by the
company on
http://www.cninfo.com.cn.
For details, please refer to the
Announcement of Beijing
Shougang Co., Ltd. on
completion of registration for
Restricted Stock Grants
Ordinary RMB 5.38 under the 2021 Restricted 2 June
25 May 2022 54,126,391 7 June 2022 54,126,391
A-share per share Stock Incentive Plan in 2022
"China Securities
Journal" ,"Securities
Times" ,"Shanghai Securities
News", Juchao Information
Network.
Description of securities issuance (excluding preference shares) during the reporting period
Beijing Shougang Co., Ltd. issued shares to purchase assets and raised supporting funds according to the "Reply on Approving
Beijing Shougang Co., Ltd. to issue shares to Shougang Group Co., Ltd. to purchase assets and raise supporting funds (CSRC
License [2022] No. 553) issued by China Securities Regulatory Commission. As of the close of market on April 19, 2022, the
Company purchased 1,015,417,369 shares issued by Shougang Group Co., Ltd. holding 49% equity of Beijing Shougang Steel
Trading Investment Management Co., Ltd. and registered them in the account, which were listed on April 20, 2022; As of the close of
the market on June 6, 2022, 54,126,391 non-publicly offering shares of the Company's supporting funds have been registered and
listed on June 7, 2022.
2. Changes of total shares and shareholders structure as well as explanation on changes of assets and liability structure
√ Applicable □ Not applicable
Beijing Shougang Co., Ltd. issued shares to purchase assets and raised supporting funds according to the " Reply on Approving
Beijing Shougang Co., Ltd. to issue shares to Shougang Group Co., Ltd. to purchase assets and raise supporting funds (CSRC
License [2022] No. 553) issued by China Securities Regulatory Commission. As of the close of market on April 19, 2022, the
company purchased 1,015,417,369 shares issued by Shougang Group Co., Ltd. holding 49% equity of Beijing Shougang Steel
Trading Investment Management Co., Ltd. and registered them in the account, which were listed on April 20, 2022; As of the close of
the market on June 6, 54,126,391 non-publicly offering shares of the Company's supporting funds have been registered and listed on
June 7, 2022. The above shares were listed on June 7, 2022, increasing the total share capital of the company from 7,765,742,779
shares to 7,819,869,170 shares and changing the shareholder structure.
The Company's issuance of shares to purchase assets has no effect on the Company's assets and liabilities; Additional issuance of
shares to raise matching funds increased current assets and owners' equity.
3. Current internal staff shares
□ Applicable √ Not applicable
III. Shareholders and the actual controller
1. Amount of shareholders and shareholding
Unit: Share
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 100,134 0 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
70
Beijing Shougang Co. Ltd Annual Report 2022
State-owned
Shougang Group 56.53% 4,420,769,800 1,015,417,3690 1,247,703,723 3,173,066,077
corporation
State-owned
Baowu Group 10.15% 793,408,440 0 793,408,440
corporation
Beijing Jingtou Investment
9.48% 740,940,679 0 740,940,679
Holding Co., Ltd.
Beijing Jing Guorui Soe
Reform and Development 6.32% 493,958,306 493,958,306 0
Fund(L.P.)
Sunshine Life Insurance Co.,
Ltd. - Traditional insurance 0.98% 76,692,529 0 76,692,529
products
National Social Security Fund
0.86% 67,547,683 0 67,547,683
- Eight combinations
Sunshine Life Insurance Co.,
Ltd. - Dividend insurance 0.72% 56,159,243 0 56,159,243
products
Liu Wei 0.69% 54,000,000 0 54,000,000
Hong Kong Securities
0.56% 43,730,398 0 43,730,398
Clearing Company Limited
Beijing Yizhen Technology
0.49% 38,206,800 0 38,206,800
Development Co., Ltd.
Strategic investor or general legal person
becoming a top-10 ordinary shareholder due Not applicable
to rights issue (if any) (found in note 10)
Shougang Group holds 0.68% of Baosteel Co., Baowu Group Co., Ltd. and its persons acting in
Related or acting-in-concert parties among the concert hold 62.30%of Baosteel Co. In addition, Shougang Group has no relationship or concerted
shareholders above 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
Shougang Group 3,173,066,077
Baowu Group 793,408,440
Beijing Jingtou Investment Holding Co., Ltd. 740,940,679
Sunshine Life Insurance Co., Ltd.- Traditional
76,692,529
insurance products
National Social Security Fund - eight
67,547,683
combinations
Sunshine Life Insurance Co., Ltd. - Dividend
56,159,243
insurance products
Liu Wei 54,000,000
Hong Kong Securities Clearing Company
43,730,398
Limited
Beijing Yizhen Technology Development Co.,
38,206,800
Ltd.
Shanxi Coking Coal Group Finance Co., Ltd. 32,155,928
Connected associated relationship or acting in
concert among the top 10 shareholders Shougang Group holds 0.68% of Baosteel Co., Baowu Group Co., Ltd. and its persons acting in
holding tradable shares without selling concert hold 62.30%of Baosteel Co. In addition, Shougang Group has no relationship or concerted
restrictions, and between the top 10 acting relationship with other top 10 shareholders; The relationship between other shareholders or the
shareholders holding tradable shares without relationship of cooperators is unknown.
selling restrictions and the top 10 shareholders
Liu Wei holds 54,000,000 shares of the company through its credit securities account; Beijing Yizhen
Top 10 ordinary shareholders involved in
Technology Development Co., Ltd. holds 38,206,800 shares of the Company through credit securities
securities margin trading (if any)
account.
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
71
Beijing Shougang Co. Ltd Annual Report 2022
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,
consulting services, leasing, agriculture, forestry, animal
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
Shougang stations to publish advertisements; design and production of print
Zhang Gongyan 13 May 1981 911100001011200015
Group advertising; use of self-owned Shougang Daily to publish
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., holding 21.68%; (2) Beiqi Foton Motor Co., Ltd., holding 0.15%; (3) Bank of
control or hold Communications Co., Ltd., holding 0.01%; (4) China Galaxy Securities Co., Ltd., holding 0.02%; (5) BAIC MOTOR Corporation.,
shares in other Ltd. (H-share), holding 12.83%.
domestic or 2. Overseas: (1) Success Yiu Global Company Limited, holding 60.88%; (2) Shoucheng Holdings Limited, holding 24.98%; (3)
overseas listed Shougang Fushan Resources Group Ltd., holding 17.09%; (4) Shougang Century Holdings Limited, holding 49.68%; (5) Global
companies Digital Creations Holdings Limited, holding 41.05%.
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
72
Beijing Shougang Co. Ltd Annual Report 2022
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
State-owned assets operation within the scope
authorized by the State Council and investment
China Baowu Steel
Chen Derong 1 Jan. 1992 RMB 52,791,101,000 and operation of state-owned capital. (if
Group Corporation Ltd.
necessary, carrying out business activities only
after approval of government agencies)
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
Progress of decrease in the holding of repurchased shares by way of bidding
□ Applicable √ Not applicable
73
Beijing Shougang Co. Ltd Annual Report 2022
Section VIII. Preferred Shares
□ Applicable √ Not applicable
No preferred shares issued by the Company during the reporting period.
74
Beijing Shougang Co. Ltd Annual Report 2022
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
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
149236 15 Sep. 2020 17 Sep. 2020 17 Sep. 2025 2,500,000,000.00 3.98% principal is repaid Stock
corporate bonds 01
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 Bidding, quotation, inquiry and agreement trading methods
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
investor recall option. It has not yet reached the exercise period.
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
China 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)
75
Beijing Shougang Co. Ltd Annual Report 2022
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., Jia Yuehua 010-67413364
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
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 2,500,000,000.00 2,500,000,000.00 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
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
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
22Shouganggufen
Ultra-short-term 18 August 19 August 24 April of principal inter-bank
SCP002 (Kechuang 012282924 1,000,000,000.00 1.68%
financing note 2022 2022 2023 and interest bond
Bill)
(Phase II) once due market
(Kechuang Bill)
Institutional investors in the national inter-bank bond market (except purchasers prohibited
Investor eligibility arrangement (if any)
by 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
76
Beijing Shougang Co. Ltd Annual Report 2022
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, Qian Bin, Yu Qike, Qian Bin, Yu Qike,
Ultra-short-term Grant Thornton LLP 010-85665231
Chaoyang District, Long Chuanxi Long Chuanxi
financing note (Phase
Beijing, China
II) (Kechuang Bill)
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 Bill) Beijing, China
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
II) (Kechuang Bill)
Change of the above intermediary organisations during the reporting period
□ Yes √ No
4. Use of proceeds
Unit: RMB
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
1,000,000,000.00 1,000,000,000.00 0.00 special account for No Consistent
financing note
raised funds
(Phase II) (Kechuang
conforms to the
Bill)
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
77
Beijing Shougang Co. Ltd Annual Report 2022
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 0.45 0.46 -2.17%
Gearing ratio 65.03% 67.21% -2.18%
Quick ratio 0.30 0.31 -3.23%
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
105,251.09 701,422.69 -84.99%
gains or losses
Proportion of EBITDA to total
12.28% 19.58% -7.30%
debts
Interest coverage ratio 1.95 5.15 -62.14%
Cash interest coverage ratio 6.92 8.15 -15.09%
EBITDA interest coverage ratio 6.08 8.33 -27.01%
Loans payment ratio 100.00% 100.00% 0.00%
Interest payment ratio 100.00% 100.00% 0.00%
78
Beijing Shougang Co. Ltd Annual Report 2022
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 19 April 2023
Name of audit institution Grant Thornton LLP
Number of audit report GTSZ (2023) No. 110A012340
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 2022, 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 2022, 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
79
Beijing Shougang Co. Ltd Annual Report 2022
The disclosures related to the impairment of inventories are disclosed in Notes III.11
and V.7 to the financial statements.
1. Description of the matter
As of 31 December 2022, the carry value of inventory of the Company amounted to
RMB 12.303 billion with an impairment of RMB 343 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 2022 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.25 and
V.41 to the financial statements.
1. Descriptions of the matter
In 2022, the revenue was RMB 118.142 billion in the consolidated financial
statements. Considering that the revenue has a significant impacted on the financial
80
Beijing Shougang Co. Ltd Annual Report 2022
statements of the Company and steel price could exert a great influence on the profits
of the Company since the steel industry is a pro-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 authenticity of revenue recognition.
(4) Selecting major customers to perform the confirmation procedures on annual sales
to evaluate the completeness of revenue recognition.
(5) Implementing cut-off tests to the sales transactions 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 2022, 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
81
Beijing Shougang Co. Ltd Annual Report 2022
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
82
Beijing Shougang Co. Ltd Annual Report 2022
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.
83
Beijing Shougang Co. Ltd Annual Report 2022
Consolidated and Parent Company Statement of Financial Position
Beijing Shougang Co., Ltd. as at 31 December 2022
Unit: RMB Yuan
31 December 2022 31 December 2021
Item Notes
Consolidated Company Consolidated Company
Current assets:
Cash and Cash equivalents V. 1 9,470,472,522.05 1,973,471,254.47 10,284,988,713.99 1,426,549,662.05
Notes receivable V. 2 6,691,086,020.85 898,640,149.83 6,830,376,685.96 1,311,383,591.78
Accounts receivable V. 3 1,450,008,897.10 1,396,660,925.53 1,678,608,393.71 1,917,892,195.00
Financing receivables V. 4 3,489,134,871.56 835,526,685.55 4,015,188,495.05 1,285,597,772.66
Prepayments V. 5 636,469,216.98 326,340,746.62 1,192,569,996.90 789,330,458.38
Other receivables V. 6 13,168,697.56 1,163,994,995.68 16,992,715.92 1,017,482,945.07
Including: Interest receivable
Dividends receivable 200,000.00 9,713,244.06
Inventories V. 7 11,960,246,748.15 1,904,197,806.47 12,425,502,043.91 2,457,421,238.04
Other current assets V. 8 1,025,942,949.49 565,959,166.92 864,665,729.52 397,054,514.15
Total current assets 34,736,529,923.74 9,064,791,731.07 37,308,892,774.96 10,602,712,377.13
Non-current assets:
Long-term equity investments V. 9 2,724,285,925.35 37,687,890,460.88 3,065,928,898.28 31,996,332,940.16
Other equity instruments investments V. 10 232,766,133.81 232,766,133.81 264,900,763.97 264,900,763.97
Other non-current financial assets V. 11 79,234,007.60 79,234,007.60 80,000,000.00 80,000,000.00
Investment properties
Fixed assets V. 12 93,331,072,969.17 19,254,378,866.41 97,227,169,862.20 20,124,641,301.41
Construction in progress V. 13 7,673,649,852.77 1,490,601,326.57 7,186,767,838.55 1,509,116,630.96
Right-of-use assets V. 14 83,107,359.45 27,014,444.30 100,279,997.64 36,019,259.06
Intangible assets V. 15 3,906,907,128.11 1,702,786,981.19 4,017,658,268.36 1,747,376,604.69
Development expenditures
Goodwill
Long-term prepaid expenses V. 16 3,535,748.04 1,226,463.57
Deferred tax assets V. 17 402,355,955.31 205,022,924.46 189,721,423.29 26,622,171.77
Other non-current assets
Total non-current assets 108,436,915,079.61 60,679,695,145.22 112,133,653,515.86 55,785,009,672.02
Total assets 143,173,445,003.35 69,744,486,876.29 149,442,546,290.82 66,387,722,049.15
84
Beijing Shougang Co. Ltd Annual Report 2022
Consolidated and Parent Company Statement of Financial Position (Continued)
Beijing Shougang Co., Ltd. as at 31 December 2022
Unit: RMB Yuan
31 December 2022 31 December 2021
Item Notes
Consolidated Consolidated Consolidated Company
Current liabilities:
Short-term borrowings V. 18 29,580,006,103.39 10,586,336,291.69 25,278,373,316.25 11,063,960,704.04
Notes payable V. 19 7,261,510,000.00 989,500,000.00 7,488,930,793.77 987,600,000.00
Accounts payable V. 20 19,810,594,484.05 9,833,463,235.41 20,197,494,619.65 9,348,168,380.88
Receipts in advance
Contract liabilities V. 21 4,508,016,725.74 521,402,199.01 5,230,456,327.37 756,726,439.51
Payroll and employee benefits V. 22 620,796,429.60 207,863,353.07 519,564,874.98 164,419,821.76
Taxes payable V. 23 172,300,416.40 22,570,197.17 425,210,314.30 19,217,188.00
Other payables V. 24 2,761,819,276.69 1,100,551,048.35 3,082,192,028.33 2,370,468,929.04
Including: Interest payable
Dividend payable 11,440,046.38
Liabilities classified as held for sale
Current portion of non-current liabilities V. 25 4,038,768,022.60 3,419,903,869.77 10,451,293,628.20 61,012,464.36
Other current liabilities V. 26 8,088,749,910.74 1,927,653,981.82 8,222,007,536.63 2,296,975,448.24
Total current liabilities 76,842,561,369.21 28,609,244,176.29 80,895,523,439.48 27,068,549,375.83
Non-current liabilities:
Long-term borrowings V. 27 10,594,350,000.00 1,267,120,000.00 11,692,710,000.00 1,792,710,000.00
Bonds payable V. 28 2,500,000,000.00 2,500,000,000.00
Lease liabilities V. 29 72,439,836.79 19,284,063.32 86,123,210.35 28,263,649.37
Long-term payable V. 30 2,300,000.00 2,300,000.00 14,659,657.85 14,659,657.85
Long-term payroll and employee benefits V. 31 82,565,651.02 82,565,651.02 81,120,000.00 81,120,000.00
Provisions
Deferred income V. 32 472,861,881.90 85,269,577.62 404,010,785.39 79,906,503.16
Deferred tax liabilities V. 17 502,268,362.26 365,393,047.63 208,958,292.75 208,958,292.75
Other non-current liabilities V. 33 4,532,018,467.20 4,563,283,607.60
Total non-current liabilities 16,258,804,199.17 1,821,932,339.59 19,550,865,553.94 4,705,618,103.13
Total liabilities 93,101,365,568.38 30,431,176,515.88 100,446,388,993.42 31,774,167,478.96
Shareholders’equity：
Share capital V. 34 7,819,869,170.00 7,819,869,170.00 6,750,325,410.00 6,750,325,410.00
Capital reserve V. 35 29,644,048,551.50 22,176,353,536.77 24,861,776,641.72 17,070,281,351.14
Less: treasury shares V. 36 210,930,850.00 210,930,850.00 210,930,850.00 210,930,850.00
Other comprehensive income V. 37 158,251,774.94 158,251,774.94 185,566,210.59 185,566,210.59
Special reserve V. 38 31,852,310.79 21,054,371.78
Surplus reserve V. 39 1,908,883,208.67 1,908,883,208.67 1,908,883,208.67 1,908,883,208.67
Retained earnings V. 40 8,595,698,699.52 7,460,883,520.03 8,130,868,205.38 8,909,429,239.79
Equity attributable to shareholders of the Company 47,947,672,865.42 39,313,310,360.41 41,647,543,198.14 34,613,554,570.19
Non-controlling interests 2,124,406,569.55 7,348,614,099.26
Total shareholders' equity 50,072,079,434.97 39,313,310,360.41 48,996,157,297.40 34,613,554,570.19
Total liabilities and shareholders' equity 143,173,445,003.35 69,744,486,876.29 149,442,546,290.82 66,387,722,049.15
85
Beijing Shougang Co. Ltd Annual Report 2022
Consolidated and Parent Company Income Statement
Beijing Shougang Co., Ltd. for the year ended 31 December 2022
Unit: RMB Yuan
Item 2022 2021
Notes
Consolidated Company Consolidated Company
I. Operating revenue V. 41 118,142,183,549.47 39,004,809,105.09 132,984,304,668.28 44,037,155,561.17
Less: Cost of sales V. 41 111,067,555,320.28 38,195,755,653.87 117,394,695,070.53 41,325,543,005.37
Taxes and surcharges V. 42 823,261,082.93 215,684,348.68 1,064,429,887.98 295,122,175.34
Selling expenses V. 43 237,997,026.22 147,362,228.16 213,309,534.38 129,253,892.82
General and administrative expenses V. 44 1,271,175,739.06 533,105,120.91 1,301,197,936.20 565,748,773.19
R&D expenses V. 45 626,923,257.36 207,810,181.56 652,926,385.56 242,853,866.40
Financial expenses V. 46 1,731,584,291.35 460,293,091.81 2,260,406,032.80 592,635,561.68
Including: Interest expense 1,863,709,861.13 507,359,008.32 2,353,346,784.74 625,241,774.26
Interest income 132,829,545.65 27,521,639.77 131,307,065.33 31,270,904.41
Add: Other income V. 47 76,142,005.96 11,800,586.33 54,544,488.92 9,859,440.42
Investment income/ (loss) V. 48 -211,209,023.35 59,234,973.72 106,379,717.79 240,889,493.89
Including: Share of profits or loss of associates and joint ventures -227,515,854.43 -178,256,786.93 93,142,769.92 203,181,607.90
Gain/ (loss) on the changes in fair value V. 49 -765,992.40 -765,992.40
Credit impairment losses V. 50 5,643,463.88 337,922.33 -127,539,908.64 -1,593,807.77
Assets impairment losses V. 51 -402,994,496.88 -63,210,278.38 -167,567,546.04 -66,598,535.40
Gain/ (loss) from disposal of assets V. 52 -611,088.11 -611,088.11 3,716,485.22 3,820,932.50
II. Operating profit/ (loss) 1,849,891,701.37 -748,415,396.41 9,966,873,058.08 1,072,375,810.01
Add: Non-operating income V. 53 11,304,199.78 4,718,009.36 6,554,194.97 2,854,654.64
Less: Non-operating expenses V. 54 68,082,023.32 51,970,642.22 65,521,293.40 37,535,685.19
III. Profit/ (loss) before tax 1,793,113,877.83 -795,668,029.27 9,907,905,959.65 1,037,694,779.46
Less: Income tax expense V. 55 283,698,478.31 -6,832,474.51 1,489,229,219.26 143,495,502.68
IV. Net profit / (loss) 1,509,415,399.52 -788,835,554.76 8,418,676,740.39 894,199,276.78
(1) Categorized by operation continuity:
Including: Net profit/ (loss) from continuing operations 1,509,415,399.52 -788,835,554.76 8,418,676,740.39 894,199,276.78
Net profit/ (loss) from discontinuing operations
(2) Categorized by ownership:
Including: Net profit/ (loss) attributable to shareholders of the Company 1,124,540,659.14 7,106,480,663.26
Net profit/ (loss) attributable to non-controlling interests 384,874,740.38 1,312,196,077.13
V. Other comprehensive income, net of tax -27,314,435.65 -27,314,435.65 -9,644,034.23 -9,644,034.23
Other comprehensive income, net of tax, attributable to shareholders of
-27,314,435.65 -27,314,435.65 -9,644,034.23 -9,644,034.23
the company
(1) Other comprehensive income that will not be reclassified to profit or
-27,314,435.65 -27,314,435.65 -9,644,034.23 -9,644,034.23
loss
Changes in fair value of other equity instrument investments -27,314,435.65 -27,314,435.65 -9,644,034.23 -9,644,034.23
(2) Other comprehensive income to be reclassified to profit or loss
Other comprehensive income, net of tax, attributable to non-controlling interests
VI. Total comprehensive income 1,482,100,963.87 -816,149,990.41 8,409,032,706.16 884,555,242.55
Total comprehensive income attributable to shareholders of the company 1,097,226,223.49 7,096,836,629.03
Total comprehensive income attributable to non-controlling interests 384,874,740.38 1,312,196,077.13
VII. Earnings per share
(1) Basic earnings per share 0.1496 1.1439
(2) Diluted earnings per share
86
Beijing Shougang Co. Ltd Annual Report 2022
Consolidated and Parent Company Statement of Cash Flows
Beijing Shougang Co., Ltd. for the year ended 31 December 2022
Unit: RMB Yuan
2022 2021
Items Note
Consolidated Company Consolidated Company
I. Cash flows from operating activities
Cash receipts from the sale of goods and the rendering of services 60,167,389,548.82 16,484,868,626.13 78,204,394,163.17 18,990,463,340.31
Tax refunds received 189,506,469.09 42,188,257.67 63,091,299.47
Cash received relating to other operating activities V. 56 767,214,052.71 20,415,777.73 63,336,125.82 144,818,152.82
Sub-total of cash inflows 61,124,110,070.62 16,547,472,661.53 78,330,821,588.46 19,135,281,493.13
Cash paid for purchase of goods and services 43,094,229,128.26 11,560,257,021.52 51,897,231,678.90 13,549,077,636.55
Cash paid to and on behalf of employee 4,581,065,361.90 1,542,021,128.22 4,679,450,437.00 1,587,524,293.24
Cash paid for taxes 3,011,630,025.15 471,766,716.43 5,508,114,238.05 1,223,075,074.28
Cash paid relating to other operating activities V. 56 392,950,057.51 200,956,450.23 852,835,390.28 382,575,353.81
Sub-total of cash outflows 51,079,874,572.82 13,775,001,316.40 62,937,631,744.23 16,742,252,357.88
Net cash flows from operating activities 10,044,235,497.80 2,772,471,345.13 15,393,189,844.23 2,393,029,135.25
II. Cash flows from investing activities
Cash received from disposal of investments 38,609,883.16 212,000,000.00 2,700,000,000.00
Cash received from investment income 82,626,235.37 242,968,827.72 210,139,106.61 814,127,544.38
Net proceeds from disposal of property, plant and equipment, intangible assets and other
12,405,207.57 9,996,517.46 46,031,802.86 39,106,972.93
long-term assets
Cash received from disposal of subsidiaries and other business units
Cash received relating to other investing activities V. 56 132,789,335.69 28,160,581.65 130,931,269.04 31,252,743.28
Sub-total of cash inflows 266,430,661.79 281,125,926.83 599,102,178.51 3,584,487,260.59
Purchase of property, plant and equipment, intangible assets and other non-current assets 2,639,013,873.80 493,955,501.86 3,270,336,323.78 1,584,616,246.57
Cash paid for investments 789,480,592.71 781,780,592.71 113,658,286.00 306,616,735.00
Net cash paid for acquisition of a subsidiary and other operating units
Cash paid relating to other investing activities V. 56 153,910,000.00 300,000,000.00
Sub-total of cash outflows 3,428,494,466.51 1,429,646,094.57 3,683,994,609.78 1,891,232,981.57
Net cash flows from investing activities -3,162,063,804.72 -1,148,520,167.74 -3,084,892,431.27 1,693,254,279.02
III. Cash flows from financing activities
Cash received from investment 1,278,391,712.18 287,603,983.82 3,003,858,828.08 1,023,858,828.08
Including: Cash receipts from capital contributions from non-controlling interests of
990,787,728.36 1,980,000,000.00
subsidiaries
Proceeds from borrowings 33,162,321,539.41 13,549,741,539.41 28,850,188,126.09 13,447,283,452.18
Proceeds from issuing bonds 2,000,000,000.00 2,000,000,000.00 2,000,000,000.00 2,000,000,000.00
Cash receipts relating to other financing activities
Sub-total of cash inflows 36,440,713,251.59 15,837,345,523.23 33,854,046,954.17 16,471,142,280.26
Repayments for debts 40,872,794,754.59 15,706,004,754.59 38,534,214,910.91 18,072,850,237.00
Cash payments for distribution of dividends or profit and interest expenses 2,519,777,625.43 1,150,312,727.17 3,088,089,392.94 1,401,619,756.90
Including: Dividends or profits paid to non-controlling shareholders of subsidiaries 45,895,343.51
Cash payments relating to other financing activities V. 55 136,968,934.05 163,699,124.52 964,082,606.56 946,843,330.04
Sub-total of cash outflows 43,529,541,314.07 17,020,016,606.28 42,586,386,910.41 20,421,313,323.94
Net cash flows from financing activities -7,088,828,062.48 -1,182,671,083.05 -8,732,339,956.24 -3,950,171,043.68
IV. Effect of exchange rate changes on cash and cash equivalents
V. Net increase in cash and cash equivalents -206,656,369.40 441,280,094.34 3,575,957,456.72 136,112,370.59
Add: Cash and cash equivalents as at the beginning of year 8,535,871,373.08 1,022,866,541.00 4,959,913,916.36 886,754,170.41
VI. Cash and cash equivalent as at the end of year 8,329,215,003.68 1,464,146,635.34 8,535,871,373.08 1,022,866,541.00
87
Beijing Shougang Co. Ltd Annual Report 2022
Consolidated Statement of Changes in Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2022
Unit: RMB Yuan
Item 2022
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
Business combination under
common control
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
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Beijing Shougang Co. Ltd Annual Report 2022
Consolidated Statement of Changes in Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2022
Unit: RMB Yuan
Item 2021
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
5,289,389,600.00 19,759,259,120.40 195,210,244.82 21,577,537.20 1,828,677,846.37 1,865,280,919.23 9,871,784,638.95 38,831,179,906.97
year
Add: Changes in accounting policies
Corrections of prior period
errors
Business combination under
-180,202,197.46 -180,202,197.46
common control
Others
II. Balance at the beginning of the
5,289,389,600.00 19,579,056,922.94 195,210,244.82 21,577,537.20 1,828,677,846.37 1,865,280,919.23 9,871,784,638.95 38,650,977,709.51
year
III. Increase/(decrease) during the
1,460,935,810.00 5,282,719,718.78 210,930,850.00 -9,644,034.23 -523,165.42 80,205,362.30 6,265,587,286.15 -2,523,170,539.69 10,345,179,587.89
period
(1)Total comprehensive income -9,644,034.23 7,106,480,663.26 1,312,196,077.13 8,409,032,706.16
(2)Shareholders' contributions
1,460,935,810.00 5,284,171,993.19 210,930,850.00 -3,822,775,473.29 2,711,401,479.90
and reduction
(i) Shareholders’ contributions
1,396,034,010.00 5,132,245,332.82 -5,618,843,879.35 909,435,463.47
in ordinary share
(ii) Amount of share-based
64,901,800.00 151,926,660.37 210,930,850.00 5,897,610.37
payments recognized in equity
(iii) Others 1,796,068,406.06 1,796,068,406.06
(3) Profit distribution 80,205,362.30 -840,893,377.11 -760,688,014.81
(i) Transfer to surplus reserve 80,205,362.30 -80,205,362.30
(ii) Distribution to shareholders -668,542,361.00 -668,542,361.00
(iii) Others -92,145,653.81 -92,145,653.81
(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 -1,452,274.41 -523,165.42 -12,591,143.53 -14,566,583.36
(i) Additions -1,452,274.41 -523,165.42 -12,591,143.53 -14,566,583.36
(ii) Utilisation
(6) Others
IV. Balance at the end of the year 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
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Beijing Shougang Co. Ltd Annual Report 2022
Parent Company Statement of Changes in Shareholders’ Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2022
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
Business combination under common
control
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
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Beijing Shougang Co. Ltd Annual Report 2022
Parent Company Statement of Changes in Shareholders’ Equity
Beijing Shougang Co., Ltd. for the year ended 31 December 2022
Unit: RMB Yuan
2021
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 5,289,389,600.00 12,129,563,493.89 195,210,244.82 1,828,677,846.37 8,856,123,340.12 28,298,964,525.20
Add: Changes in accounting policies
Corrections of prior period errors
Business combination under common
-180,202,197.46 -180,202,197.46
control
Others
II. Balance at the beginning of the year 5,289,389,600.00 11,949,361,296.43 195,210,244.82 1,828,677,846.37 8,856,123,340.12 28,118,762,327.74
III. Increase/(decrease) during the period 1,460,935,810.00 5,120,920,054.71 210,930,850.00 -9,644,034.23 80,205,362.30 53,305,899.67 6,494,792,242.45
(1) Total comprehensive income -9,644,034.23 894,199,276.78 884,555,242.55
(2) Shareholders' contributions and reduction 1,460,935,810.00 5,120,920,054.71 210,930,850.00 6,370,925,014.71
(i) Shareholders’ contributions in ordinary
1,396,034,010.00 5,113,754,895.99 6,509,788,905.99
share
(ii) Amount of share-based payments
64,901,800.00 7,165,158.72 210,930,850.00 -138,863,891.28
recognized in equity
(iii) Others
(3) Profit distribution 80,205,362.30 -840,893,377.11 -760,688,014.81
(i) Transfer to surplus reserve 80,205,362.30 -80,205,362.30
(ii) Distribution to shareholders -668,542,361.00 -668,542,361.00
(iii) Others -92,145,653.81 -92,145,653.81
(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 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
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Beijing Shougang Co. Ltd Annual Report 2022
Notes to the Financial Statements
I. General Informantion of the Company
1. Company profile
Beijing Shougang Company Limited (hereinafter referred to as the Company) is a joint stock
limited company established by means of raising, which is approved by Beijing Municipal People's
Government Jingzhenghan [1998] No. 34 and exclusively initiated by Shougang Group Co., Ltd.
With the approval of zjxz [1999] No. 91 document issued by China Securities Regulatory
Commission, the Company was the first to issue 350,000.00 thousand ordinary shares (A shares) to
the public in Shenzhen Stock Exchange from 21 to 27 September, 1999 by the combination of legal
person placement and online issuance, with par value of RMB 1 per share and issue price of RMB
5.15 per share, with the stock code of 000959. The Company registered with approval of Beijing
Administration for Industry and Commerce on 15 October, 1999. The Company holds the business
license with unified social credit code of 1100001028663 (1-1), with the registered capital of RMB
2,310,000,000.00.
The Company issued the convertible corporate bonds worthed RMB 2,000,000 thousand on 16
December, 2003 upon the approval of zjfxz [2003] No. 107 document issued by China Securities
Regulatory Commission. On 31 December, 2003, the convertible bond was listed and traded in
Shenzhen Stock Exchange. The bond is abbreviated as “Shougang Convertible Bond” with the bond
code of “125959”. The convertible bonds were converted into shares since June 16, 2004, and met
the redemption conditions until 26 February 2007. Accordingly, the board of directors of the
company issued the redemption announcement. As of 6 April, 2007, the date of convertible bond
redemption, the total amount of Shougang convertible bonds was RMB1,950,217,500.00, which
was converted into the Company's shares, with an accumulated increase of RMB 656,526,057.00 in
share capital. The Company obtained a new business license of legal entity on November 20, 2008,
with the registration number 110000000286633 (1-1), and the registered capital changed to RMB
2,966,526,057.00.
On 16 January, 2013, the Company's material assets reorganization was reviewed by the
reorganization committee of CSRC and passed unconditionally. On 29 January, 2014, China
Securities Regulatory Commission issued “Reply on approving material assets reorganization of
Beijing Shougang Co., Ltd. and shares issuance to Shougang Group to purchase assets”. As of 25
April, 2014, the implementation of material assets reorganization of the Company has been
completed. In the material assets reorganization, the private placement to Shougang Group was
2,322,863,543 shares, with par value of RMB 1 each and issue price of RMB 4.29 each. The
Company obtained the new business license of legal entity after capital increment on 9 July, 2014,
with the registration number of 110000000286633, and the registered capital changed to RMB
5,289,389,600.
On 21 April 2021, the event of "Share Issuing to Beijing Jingtou Investment Holding Co., Ltd. etc.
for Assets Purchase and Fundraising" has been approved by the CSRC (CSRC Permit No. [2021]
1400). According to the approval, the Company issued 1,234,898,985.00 shares to Beijing Jingtou
Investment Holding Co., Ltd. and Beijing Jing Guorui Soe Reform and Development Fund(L.P.) for
acquiring 19.1823% shares of Shougang Jingtang United Iron & Steel Co., Ltd. (hereinafter referred
to as the Jingtang Co.) on 23 April 2021. On 17 June 2021, the Company issued 161,135,025 shares
to 8 investors at the price of RMB 5.11 per share, and RMB 823,399,977.75 were collected. After
this issuing, the registered capital of the Company is RMB 6,685,423,610.00.
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Beijing Shougang Co. Ltd Annual Report 2022
On 9 December 2021, by the approval of 2021 First Extraordinary General Meeting and State
Owned Assets Supervision and Administration Commission (hereinafter referred to as “SASAC”),
the Company has completed the 2021 restricted stock incentive plan. There were 64,901,800.00
shares issued to 386 directors, senior management, key technicians and management backbone with
the issue price of RMB 3.25 per share. Aftere this offering, the registered capital of the Company
changes to RMB 6,750,325,410.00.
On March 18, 2022, the Company obtained the Reply on the Approval for Beijing Shougang Co.,
Ltd. 's to Issue Shares to Shougang Group Co., Ltd. to Purchase Assets and Raise Supporting Funds
(CSRC License [2022] No. 553) issued by China Securities Regulatory Commission. On March 31,
2022, the Company issued 1,015,417,369 shares to Shougang Group Co., Ltd. to purchase 49.00%
equity of Beijing Shougang Steel Trade Investment Management Co., Ltd. held by Shougang
according to the approval document. On May 20, 2022, the Company issued 54,126,391 shares to
eight investors at an issue price of RMB5.38 per share and the total amount of raised funds is
RMB291,199,983.58. After this offering, the registered capital of the Company changes to RMB
7,819,869,170.00.
The Company obtained the new business license of legal entity on 22 December, 2016 after the
integration of five certificates, with the unified social credit code 911100007002343182.
The statutory address is Shijingshan Road, Shijingshan District, Beijing.
The Company has established the corporate governance structure of the general meeting of
shareholders, the board of directors and the board of supervisors. At present, the Company sets up
serval functional departments, for instance, secretary office of the board of directors, the planning
and financing department, the manufacturing department, the marketing center, the purchasing
center, the human resources department, the equipment department, the energy department, the
environmental protection department, the quality inspection department, the office, etc, as well as
the subordinate factories such as Shougang Qian'an Iron&Steel Co., Ltd. and auxiliary production
department, like the technical center. The company has six subsidiaries: Shougang Jingtang United
Iron&Steel Co., Ltd., Beijing Shougang Cold Rolling Co., Ltd., Qian'an Shougang Metallurgical
Technology Co., Ltd., Shougang Zhixin Qian'an Electromagnetic Materials Co., Ltd., Beijing
Shougang New Energy Automobile Material Technology Co., Ltd., and Beijing Shougang Steel
Trade Investment Management Co., Ltd.
The business scope of the Company includes iron and steel smelting, steel calendering processing,
copper smelting and calendering processing and sales; manufacturing and sales of sinter, coke and
chemical products; blast furnace residual pressure power generation and production and sales of gas;
processing and sales of industrial waste; sales of metal materials, coke, chemical products,
mechanical and electrical equipment, building materials, general equipment, hardware, furniture
and decorative materials; equipment leasing (excluding automobiles); telecommunications services;
insurance agency services; insurance broker services; loading, unloading and handling services;
software delevopment; advertising design and agency; warehousing services; technology
development, technical consultation, technology transfer, technical service and technical training;
investment and investment management.
The financial statements and notes were approved by the second meeting of the eighth Board of
Directors on 19 April 2023.
2. Scope of consolidated financial statements
The scope of the consolidated financial statements is determined on the control basic, the scope
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Beijing Shougang Co. Ltd Annual Report 2022
includes six subsidiaries, which are Shougang Jingtang United Iron&Steel Co., Ltd., Beijing
Shougang Cold Rolling Co., Ltd., Qian'an Shougang Metallurgical Technology Co., Ltd., Shougang
Zhixin Qian'an Electromagnetic Materials Co., Ltd., Beijing Shougang New Energy Automobile
Material Technology Co., Ltd., and Beijing Shougang Steel Trade Investment Management Co.,
Ltd.
The details refer to Note VI. Changes in the scope of consolidation and VII. Interests in other
entities.
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). Additionally, the Company discloses relevant financial information in accordance with
requirements in the “Preparation Convention of Information Disclosure by Companies Offering
Securities to the Public No.15—General Rules on Financial Reporting” (2014 revised) issued by 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, amortization
of intangible assets, capitalization conditions of R&D expenses and revenue recognition policies,
the detailed accounting policies refer to Note III. 14, Note III. 18, Note III. 19 and Note III. 25.
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 2022,
and the financial performance and cash flows for the year ended 31 December 2022.
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 financial statements of the Company have been prepared in RMB.
5. Accounting treatments for business combination involving entities under common control and
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Beijing Shougang Co. Ltd Annual Report 2022
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 separate financial statements, the initial investment cost is calculated based on the
shareholding portion of net assets of the consolidated party in the carrying amount of the ultimate
controlling party’s consolidated financial statement at the acquisition date. The difference between
the initial investment cost and the sum of the carrying amount of the original investment cost and
the carrying amount of consideration paid for the combination is adjusted to the capital reserve
(equity premium), if the capital reserve is not sufficient to absorb the difference, the excess shall be
adjusted to retained earning.
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
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 separate financial statements, the initial investment cost is the sum of the carrying amount of
the equity investment held by the entity prior to the acquisition date and the additional investment
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Beijing Shougang Co. Ltd Annual Report 2022
cost at the acquisition date. The disposal accounting policy of other comprehensive income related
with equity investment prior to the purchase date recognized under equity method shall be
compliance with the method when the acquire disposes the related assets or liabilities.
Shareholder’s equity due to the changes of other shareholder’s equity other than the changes of net
profit, other comprehensive income and profit distribution shall be transferred to profit or lose for
current period when disposed. If the equity investment held by the entity prior to the acquisition
date is measured at fair value, the cumulative change in fair value recognized in other
comprehensive income shall be transferred to retained earnings for current period under cost
accounting method.
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 incurred by the changes
of net assets or net liabilities due to the re-measurement of defined benefit plan.
(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.
6. Method of preparing consolidated financial statements
(1) 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.
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Beijing Shougang Co. Ltd Annual Report 2022
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
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.
The other comprehensive income related to the original subsidiary’s equity investment shall be
transferred to current period profit and loss when control is lost, except for the other comprehensive
income arising from the movement of net liabilities or assets investee’s re-measurement of defined
benefit plan.
(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
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Beijing Shougang Co. Ltd Annual Report 2022
transactions;
④The transaction alone is not economical, however, it becomes economical to consider the other
transactions together.
In the separate financial statements, by stepping through multiple transactions to dispose of the
equity investment in the subsidiary until it loses control, when it is not a package transaction,
carrying forward the book value of each disposal of equity relative to the corresponding long-term
equity investment, and the difference between the considerations and the book value of the disposal
of long-term equity investment is recognized in the current period investment income or loss. When
it is a package transaction, the price difference between the disposal price and the disposal
investment before the loss of control is recognized as other comprehensive income in the
consolidated financial statements, and is transferred to the current period profit or loss of control
when the control is lost.
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.
7. Joint arrangement and joint operations
Joint arrangement refers to an arrangement under the joint control of two or more entities. The joint
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
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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.
8. 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.
9. 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
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 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;
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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
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 business model of managing financial assets refers to how the Company manages financial
assets to generate cash flow. The business model determines if the source of cash flow for financial
assets managed by the Company is collecting contract cash flow, selling financial assets or both of
them. The Company determines the business model of financial assets management on the basis of
objective facts and the specific business goals of financial assets management decided by key
managers.
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,
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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.
A financial asset is measured at its fair value at initial recognition. For financial assets measured at
fair value thorugh profit or loss, the relevant transaction costs are charged to profit or loss; for other
financial assets, the relevant transaction costs are recognized as initial investment costs. For the
trade receivables arising from the sale of goods or services provided do not contain or take into
account significant financing components, the initial investment costs shall be the consideration,
which the Company is entitled to receive with the expectation.
(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
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.
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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.10.
(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
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
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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.
Notes receivable, Accounts receivable, and Contract assets
For notes receivable, accounts receivable and contract assets, 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
Combination 1: Bank acceptances
Combination 2: Bank acceptances with lower credit rating and Commercial acceptances
B. Accounts receivable: Accounts of receivable-trade
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
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For the other receivables combination, the Company calculates the expected credit losses through
the exposure on default and the next 12-month or the whole lifetime expected credit loss rate.
Debt investments and other debt investments
For debt investments and other debt investments, the Company calculates the expected credit losses
through the exposure on default and the next 12-month or the whole lifetime expected credit loss
rate, according to the nature of the investment, the types of counterparty and risk exposure.
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;
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;
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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
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
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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.
10. 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,
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.
11. Inventories
(1) Classification
Inventories of the Company include raw materials, finished goods, lower-valued consumables and
self-made semi-finished goods
(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.
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(3) Basis for determining the net realisable value and method for inventories provision
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.
At the end of each reporting period, if the cost is in excess of net realisable value, provision for
inventories is recognized in profit or loss. The Company usually recognizes provision according to
the independent inventory item. When the circumstances that previously caused inventories to be
written down below cost no longer exist, the original amount of the write-down is reversed.
(4) Inventory system
Inventories are accounted for using the perpetual inventory system.
(5) Amortization method for consumables and packaging
Low-valued consumables are charged with the one-off amortization method and multi-stage
amortization method at consumption.
12. Assets classified as held for sale and discontinued operations
(1) Classification and measurement of non-current assets or disposal groups held for sale
The Company classifies the non-current asset or disposal group as held for sale when the carrying
amount of the non-current asset or disposal group will be recovered through sale (including
exchange transactions of non-monetary assets with commercial substance) rather than through
continuing use.
Above mentioned non-current assets not include investment properties subsequently measured with
the fair value model, biological assets measured at fair value less cost of sales, assets arising from
employee benefits, financial assets, deferred tax assets and contractual rights under insurance
contracts.
The disposal group is the group of assets to be disposed of, by sale or otherwise, together as a whole
in a single transaction, and liabilities directly associated with those assets that will be transferred in
the transaction. Under certain circumstances, disposal group included goodwill acquired in the
business combination.
The non-current asset or disposal group is classified as held for sale when all the following criteria
are satisfied: According to the trading routine of selling such asset or disposal group in similar
transactions, the non-current asset or disposal group is available for immediate sale in current
circumstance; the sale is highly probable to occur, that is, the Company has made a resolution on a
sale plan and obtained the assured purchase agreement. The sale is expected to be completed within
one year. If the control of the subsidiary is lost due to the sale of investment on the subsidiary and
the investment intended to be sold satisfies all conditions for the classification of assets held for sale,
the Company classifies all the investment in that subsidiary as held for sale in separate financial
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statements, and classifies all the assets and liabilities of that subsidiary as held for sale in
consolidated financial statements no matter whether the Company will keep part of the equity
investment.
Excess of the carrying amount over the fair value less costs to sell is recognized as assets
impairment losses in the initial recognition or remeasurement on balance sheet date of non-current
asset or disposal group. The carrying amount of goodwill allocated to the disposal group shall be
deducted firstly by the impairment loss recognized for the disposal group, and then the carrying
amount of each non-current asset in the disposal group shall be proportionately deducted in
accordance with the proportion of the carrying value of the non-current assets in the disposal group.
If net amount of fair value of the non-current asset or disposal group less costs to sell increases, the
amount of the write-down will be recovered but not in excess of the cumulative impairment loss
that has been recognised after classified as held for sale. The reverse amount is recorded in the
current profit or loss. Additionally, the reduced carrying amount of goodwill could not be recovered.
The Company does not depreciate (or amortise) the non-current assets classified as held for sale or
assets of the disposal group classified as held for sale. Interest and other expenses attributable to the
liabilities of the disposal group classified as held for sale continue to be recognised. If an
investment or a part of the investment in an associate or a joint venture is classified as held for sale,
equity method is not used for the part classified as held for sale, while equity method is used for the
rest part (the part not classified as held for sale) continuely. When the Company does not have
material impact on an associate or a joint venture due to the sale transaction, equity method will be
discontinued.
Where a non-current asset or disposal group is classified as held for sale but no longer meets the
conditions for holding for sale classification, the Company discontinues its classification as held for
sale and counts it according to the lower of:
① The carrying amount of the asset and disposal group before classification as held for sale,
adjusted for any depreciation, amortisation or impairment recognised under the assumption that the
asset or disposal group has not been classified as held for sale;
② Recoverable amount
(2) Discontinued operations
Discontinued operation refers to the separately identifiable component that has been disposed or
been classified as held for sale and satisfies one of the follwing conditions:
① It represents am independent major business line or a separate geographical area of operations;
② It is part of a single co-ordinated plan to dispose of an independent major business or a separate
geographical area of operations;
③ It is a subsidiary acquired exclusively with a view to resale.
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(3) Presentation
The Comapany presents the non-current assets classified as held for sale and the assets of disposal
group classified as held for sale as “Assets classified as held for sale” in balance sheet. The
liabilities of disposal group classified as held for sale is presented as “Liabilities classified as held
for sale” in balance sheet.
The Company presents profit or loss from discontinued operations separately from profit or loss
from continuing operations in income statement. Impairment loss and reversal amount and any
disposal gain or loss of the non-current asset or disposal group classified as held for sale that does
not satisfy the definition of a discontinued operation is presented in profit or loss from continuing
operations. Any impairment loss and reversal amount belongs to discontinued operations, and
disposal gain or loss is presented in profit or loss from discontinued operations.
The disposal group which is planned to cease use rather than for sale, and satisfies the conditions of
components of discontinued operation, the Company presents it as discontinued operation from the
date of cessation.
For the discontinued operation presented in the current period, former profit or loss of continuing
operations will be presented as discontinued operations for comparative accounting period in the
current financial statements. If the discontinued operations no longer satisfy the conditions to be
classified as held for sale, former profit or loss of discontinued operations will be presented as
continuing operations for comparative accounting period in the current financial statements.
13. Long-term equity investments
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.
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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.
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
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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
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) Held-for-sale equity investments
Accounting treatment for the entity investment, or a portion of an equity investment, in associates
or joint ventures that is classified as held for sale refers to Note III, 12.
Any remaining equity investment that has not been classified as held for sale shall be accounted
under the equity method.
When the equity investment in associates or joint ventures previously classified as held for sale and
no longer satisfies the conditions to be classified as held for sale, it will be adjusted under equity
method retrospectively as from the date of classification as held for sale.
(5) Method of impairment testing and impairment provision
For investment in subsidiaries, associates and joint ventures, refers to Note III, 20 for the method of
asset impairment provision.
14. Fixed assets
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(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 residual value depreciation rate
Pant and buildings 25-43 years 5% 3.80-2.21%
Machinery and equipment 12-28 years 5% 7.92-3.39%
Vehicles 10 years 5% 9.50%
Electronic equipment 10 years 5% 9.50%
Industrial furnace 13 years 5% 7.31%
Metallurgical equipment 19 years 5% 5.00%
Others 14-22 years 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, 20.
(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.
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(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.
15. Construction in progress
Cost comprises the direct costs of construction and capitalised borrowing costs on related borrowed
funds during the period of construction.
Construction in progress is reclassified to the appropriate category of fixed assets when completed
and ready for use.
Impairment provision of construction in progress refers to Note III. 20.
16. 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
transfer to inventory after the completion of construction.
Impairment provision of materials for construction of fixed assets refers to Note III, 20.
Closing balance of materials for construction of fixed assets is presented in “Construction in
progress” in balance sheet.
17. 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.
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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.
18. Intangible assets
(1) Valuation method, service life and impairment test
Intangible assets include land use rights, software and etc.
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 amortization method of intangible assets with limited service life is as follows:
Intangible assets with finite useful lives are amortized over the useful lives on the straight-line basis
according to the category, expected useful lifetime and estimated residual value. The annual
amortization rates of each category of intangible assets are as follows:
Annual
Category Useful lifetime Amortisation method
amortization rate
Software 5-10 years Straight line method 10.00-20.00%
Land use rights 40-50 years Straight line method 2.00-2.50%
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
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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, 20.
19. Development expenditure
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.
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.
20. 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, investment property measured at
fair value model, 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.
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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.
21. 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
expense items that cannot benefit the later accounting period, the amortized value is recognized in
the profit or loss.
22. 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.
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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, etc.
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
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.
23. 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.
24. 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.
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(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.
(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
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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.
25. 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.
The Company satisfies a performance obligation over time if one of the following criteria is met; or
otherwise, a performance obligation is satisfied at a 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.
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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.
⑤ The customer has accepted the goods or services.
⑥ Other indications that the customer has obtained control of goods.
A contract asset is the Company’s right to consideration in exchange for goods or services that it has
transferred to a customer when that right is conditional on factors other than the passage of time.
The Company recognises loss allowances for expected credit loss on contract assets. The
Company’s right to consideration that is unconditional (only the passage of time is required) shall
be presented as accounts receivable. The Company’s obligation to transfer goods or services to a
customer for which the Company has received consideration (or an amount of consideration is due)
from the customer shall be presented as the contract liability.
The Company offsets the contract assets and contract liabilities under the same contract and
presents the net amount. If the net amount is the debit balance, it is presented under “contract
assets” or “other non-current assets” according to its liquidity; if the net amount is the credit
balance, it is presented under “contract liabilities” or “other non-current liabilities” according to its
liquidity.
(2) Specific recognition methods
The specific revenue recognition methods of the company are as follows:
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.
26. Contract cost
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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;
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.
The contract performance cost recognized as an asset shall be shown in the "Inventories" item with
an amortization period of no more than one year or one normal operating cycle at the time of initial
recognition, while the amortization period exceeding one year or one normal operating cycle at the
time of initial recognition shall be shown in the item of "Other non-current assets".
The contract acquisition cost recognized as an asset shall be listed in the item of "Other current
assets" when the amortization period does not exceed one year or one normal operating cycle at the
time of initial recognition, and listed in the item of "other non-current assets" when the amortization
period exceeds one year or one normal operating cycle at the time of initial recognition.
27. Government grants
Government grants are recognized in profit or loss, when they are highly probable to be received
and all conditions are fulfilled.
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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.
Asset-related government grants can be accounted by offsetting the carrying amout of related assets
or being recognized as deferred income, and amortized systematically and reasonably to profit or
loss over the useful life of the related asset. If the income-related grant is a compensation for related
incurred expenses or losses, the grant shall be recognized in the current pofit or loss or offset related
costs immediately; if the grant is a compensation for related expensesor losses in future period, the
grant is recognized as deferred income and should be recognized in profit or loss for the period
when the expenses or losses are incurred. For the government grant measured at the nominal
amount, it should be recognized in profit or loss immediately for the period. The Company adopts a
consistent approach to the same or similar government grants.
The government grants related to daily activities shall be recognized in other income or offset
related expenses. Otherwise, it shall be recognized in non-operating income and expenses.
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
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.
28. 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; and
(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
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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; and
(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.
At the end of each reporting period, deferred tax assets and liabilities are measured at the tax rates
that are expected to apply to the period when the asset is realized or the liability is settled, taking
into account the income tax effect of expected asset realization or liability settlement at the end of
each reporting period.
The carrying amount of a deferred tax asset is reviewed at the end of each reporting period and is
reduced to the extent that it is no longer probable that sufficient taxable profits will be available to
allow the related tax benefit to be utilized. Any such reduction is reversed to the extent that it
becomes probable that sufficient taxable profits will be available.
29. 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.30.
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
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Beijing Shougang Co. Ltd Annual Report 2022
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
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.
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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
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.
30. 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.
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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
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.
31. Safety fund and maintenance fee
According to the relevant provisions of CQ [2012] No. 16 document issued by Ministry of Finance,
National Development and Reform Commission, State Administration of Work Safety, the actual
operating income of metallurgical and transportation enterprises in the preceding year is the basis
for the provision of safety fund and maintenance fee of the Company, and the method of excess
retirement shall be adopted for the provision.
Safety funds and maintenance fees are included in the cost of relevant products or recognized in the
current profit or loss for the related products, and credited to the special reserve at the same time.
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.
32. Restricted stock
In the equity incentive plan, the Company grants restricted stock to the incentivied. The incentivied
first subscribe for the stock. If the unlocking conditions specified in the equity incentive plan are
not met, the Company repurchases the stock at the price agreed in advance. Where the restricted
stock issued to the employees has gone through registration and other capital increase procedures in
accordance with relevant provisions, the Company shall, on the grant date, confirm the share capital
and capital reserve (capital premium) according to the subscription payment received from the
employees, also recognize treasury shares and other payables with respect to repurchase
obligations.
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33. 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
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
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Beijing Shougang Co. Ltd Annual Report 2022
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.
34. Changes in significant accounting policies and estimates
(1) Changes in significant accounting policies
① Accounting Standards for Business Enterprises Interpretation No. 15
The Ministry of Finance issued the "Interpretation of Accounting Standards for Business
Enterprises No. 15" (Cai Kuai [2021] No. 35) in December 2021 (hereinafter referred to as
"Interpretation No. 15")
Interpretation No. 15 stipulates that, in case an enterprise conducts external sales of products or
by-products produced before fixed assets reaching the intended use or during the R&D process
(collectively, “Trial Sales”), the accounting treatment shall be carried out separately in accordance
with the Accounting Standards for Business Enterprises No. 14 – Revenue and the Accounting
Standards for Business Enterprises No. 1 – Inventories.
The Interpretation No. 15 is effected since 1 January 2022, and the Company shall retroactively
adjust the trial sales that occurred between the beginning of the earliest period for financial
statement presentation and January 1, 2022.
Interpretation No. 15 stipulates that when determining a loss contract, the cost of fulfilling the
contract by the enterprise includes the incremental cost of fulfilling the contract and the allocation
amount of other costs directly related to fulfilling the contract. Among them, the incremental cost of
fulfilling the contract includes direct labor, direct materials, etc; The allocation amount of other
costs directly related to the performance of the contract includes the depreciation expense allocation
amount of fixed assets used for the performance of the contract. The Interpretation No. 15 is
effected since 1 January 2022, and the Company shall implement this provision for contracts that
have not fulfilled all the obligations by January 1, 2022. The cumulative impact shall be adjusted to
the retained earnings and other related financial statement items at the beginning of the year on the
implementation date, without adjusting the comparative financial statement data in the previous
period.
The adoption of Interpretation No. 15 had no material impact on the financial position and
operating performance of the Company.
② Interpretation No. 16 of the Accounting Standards for Business Enterprises
The Ministry of Finance issued Interpretation No. 16 of the Accounting Standards for Business
Enterprises (Cai Kuai [2022] No. 31) (“Interpretation No. 16”) in November 2022.
Interpretation No. 16 stipulates that, for financial instruments such as perpetual bonds classified as
equity instruments, the enterprise shall recognise the income tax effect related to dividends when
recognising dividend receivables. For distributed profits from transactions or events that previously
generated profit or loss, the income tax effect of the dividend shall be included in profit or loss for
the period; for distributed profits from transactions or events that was previously recognised in
owner’s equity, the income tax effect of the dividend shall be included in owner’s equity. The above
regulations were implemented since November 30, 2022. Companies shall adjust the impact of
income tax on financial instruments retrospectively that occurred before January 1, 2022 and the
relevant financial instruments have not been derecognized as of January 1, 2022.
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Interpretation No. 16 stipulates that, if an enterprise replaces cash-settled share-based payment with
equitysettled share-based payment in accordance with terms and conditions under cash-settled
share-based payment agreement, on the date of change, equity-settled share-based payment shall be
measured at the fair value as at the date of grant of such equity instrument, with services received to
be included in capital reserve. Meanwhile, recognised liability in relation to cash-settled
share-based payment as at the date of change shall be derecognised, with difference thereof to be
included in profit or loss for the current period. If the vesting period is extended or shortened due to
the revision, the enterprise shall perform the above accounting treatment according to the revised
vesting period. The above regulations were implemented since November 30, 2022. Companies
shall adjust retained earnings and other related financial statement items for transactions that
occurred before January 1, 2022, and do not adjust comparable period information.
The adoption of Interpretation No. 16 had no material impact on the financial position and
operating performance of the Company.
(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%
Value-added tax Taxable Revenue 13/9/6
City construction
Turnover tax payable 7/5
and maintenance tax
Education surcharge Turnover tax payable 3
Local education surcharge Turnover tax payable 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
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Beijing Shougang Co. Ltd Annual Report 2022
years.
In accordance to relevant regulations, above companies enjoy a preferential income tax rate at 15%
in 2021.
Since 1 January 2019, according to Cai Shui [2019] No.13 “Notice of the State Administration of
Taxation on implementing policy of tax reduction for small and low-profit enterprises”, for the part
of annual taxable income less than RMB 1 million of small and low-profit enterprises, tax reduction
of 25% shall be included, and then income tax shall be paid at 20%. Since 1 January 2021 to 31
December 2022, according to Cai Shui [2021] No.12 “Announcement on the implementation of
preferential income tax policies for small and micro enterprises and individual industrial and
commercial households”, for the part of annual taxable income less than RMB 1 million of small
and low-profit enterprises, the enterprise income tax is reduced by half on the base of the
preferential policies of Cai Shui [2019] No.13. Wuhan Shougang Automobile Material Co., Ltd., the
sub-subsidiary of the Company, satisfies the requirements of small and low-profit enterprise
declaration and its income taxes have been declared as the policy of small and low-profit enterprise.
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Beijing Shougang Co. Ltd Annual Report 2022
V. Notes to consolidated financial statements
1. Cash and Cash equivalents
Item 2022.12.31 2021.12.31
Cash on hand 23,581.90 53,404.48
Bank deposits 8,330,041,178.17 8,536,627,515.03
Including: financial companies deposited 7,693,973,274.02 8,496,270,996.46
Other monetary assets 1,140,407,761.98 1,748,307,794.48
Including: financial companies deposited 1,088,690,000.00 1,497,328,783.36
Total 9,470,472,522.05 10,284,988,713.99
Others: (1) As at December 31, 2022, except for RMB 1,090,407,749.24 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 849,769.13. This part of
interest does not belong to "cash and cash equivalents."
2. Notes receivable
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
Continued:
2021.12.31
Item
Book balance Bad debt provision Carrying value
Bank acceptance notes 606,890,114.70 606,890.11 606,283,224.59
Commercial acceptance notes 6,230,323,785.17 6,230,323.80 6,224,093,461.37
Total 6,837,213,899.87 6,837,213.91 6,830,376,685.96
(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 6,190,000.00
(2) Outstanding endorsed or discounted notes that have not matured at the end of the year
Amount derecognized as of December Amount not-derecognized as of December
Item
31, 2022 31, 2022
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Beijing Shougang Co. Ltd Annual Report 2022
Bank acceptance notes -- 950,045,846.29
Commercial acceptance notes -- 5,408,779,162.42
Total -- 6,358,825,008.71
(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, 2022
Commercial acceptance notes 5,673,594.85
(4) Classified by bad debt provision method
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
Continued:
2021.12.31
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
6,837,213,899.87 100.00 6,837,213.91 0.10 6,830,376,685.96
based on credit risk
characteristics
Portfolio 1 -- -- -- -- --
Portfolio 2 6,837,213,899.87 100.00 6,837,213.91 0.10 6,830,376,685.96
Total 6,837,213,899.87 100.00 6,837,213.91 0.10 6,830,376,685.96
(5) Provision, recovery or reversal of bad debt
Item Bad debt provision
As at 1 January 2022 6,837,213.91
Provision --
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Beijing Shougang Co. Ltd Annual Report 2022
Item Bad debt provision
Recovery or reversal 139,430.10
As at 31 December 2022 6,697,783.81
(6) There is no notes receivable written off during the reporting period.
3. Accounts receivable
(1) Disclosed by the ageing
Ageing 2022.12.31 2021.12.31
Within 1 year 1,492,629,056.11 1,734,897,859.01
1 – 2 years 13,542,310.43 5,469,120.72
2 – 3 years 3,980,837.55 7,533,727.52
Over 3 years 13,036,557.92 8,900,931.48
Subtotal 1,523,188,762.01 1,756,801,638.73
Less: provision for bad debts 73,179,864.91 78,193,245.02
Total 1,450,008,897.10 1,678,608,393.71
(2) Disclosed by bad debt provision
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
Total 1,523,188,762.01 100.00 73,179,864.91 4.80 1,450,008,897.10
Disclosed by bad debt provision (continued):
2021.12.31
Category Book balance Bad debt provision
Expected credit Carrying value
Amount Proportion (%) Amount
loss (%)
Assessed bad debt
12,828,816.67 0.73 12,828,816.67 100.00 --
provision individually
Assessed bad debt
provision in portfolios
1,743,972,822.06 99.27 65,364,428.35 3.75 1,678,608,393.71
based on credit risk
characteristics
Total 1,756,801,638.73 100.00 78,193,245.02 4.45 1,678,608,393.71
Assessed bad debt provision individually:
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Beijing Shougang Co. Ltd Annual Report 2022
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
Continued:
2021.12.31
Accounts receivable
(by debtor) Expected credit loss Reason for
Book balance Bad debt provision
(%) bad debts
Accounts receivable over 3
3,377,121.82 3,377,121.82 100.00 Long aging
years
Overdue recourse notes 9,451,694.85 9,451,694.85 100.00 Overdue recourse notes
Total 12,828,816.67 12,828,816.67 100.00
Assessed bad debt provision in portfolios:
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 -- -- --
Total 1,510,152,204.09 60,143,306.99 3.98
Continued:
2021.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
Within 1 year 1,734,897,859.01 60,842,691.31 3.51
1 – 2 years 4,469,120.72 1,253,706.63 28.05
2 – 3 years 4,605,842.33 3,268,030.41 70.95
Over 3 years -- -- --
Total 1,743,972,822.06 65,364,428.35 3.75
(3) Provision, recovery or reversal of bad debt
Item Bad debt provision
As at 1 January 2022 78,193,245.02
Provision --
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Beijing Shougang Co. Ltd Annual Report 2022
Recovery or reversal 5,013,380.11
As at 31 December 2022 73,179,864.91
(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 RMB 796,180,178.42, accounts for 52.28% 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 28,348,972.41.
Closing balance
Percentage of total
Company Name Closing balance of bad
accounts receivable (%)
debt provision
Shougang Casey Steel Co., Ltd. 290,361,751.31 19.06 10,336,878.35
BYD (Shenzhen)Supply Chain Management
181,675,741.56 11.93 6,470,080.15
Co., Ltd.
Shanghai Zhenhua Heavy Industries Co., Ltd. 134,179,518.89 8.81 4,776,790.86
China Petrochemical International Co., Ltd. 102,744,407.80 6.75 3,659,071.64
China First Automobile Co., Ltd. 87,218,758.86 5.73 3,106,151.41
Total 796,180,178.42 52.28 28,348,972.41
4. Financing receivable
Item 2022.12.31 2021.12.31
Notes receivable 3,489,134,871.56 4,015,188,495.05
Less：Other comprehensive income - fair value changes -- --
Closing balance of fair value 3,489,134,871.56 4,015,188,495.05
The Company discounts and endorses most bank acceptance notes in accordance with routine 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
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 based on 3,489,832,838.11 100.00 697,966.55 0.02 3,489,134,871.56
credit risk
characteristics
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Beijing Shougang Co. Ltd Annual Report 2022
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
Continued:
2021.12.31
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 4,015,991,400.14 100.00 802,905.09 0.02 4,015,188,495.05
based on credit risk
characteristics
Portfolio 1 4,015,991,400.14 100.00 802,905.09 0.02 4,015,188,495.05
Portfolio 2 -- -- -- -- --
Total 4,015,991,400.14 100.00 802,905.09 0.02 4,015,188,495.05
(2) Provision, recovery or reversal of bad debt
Item Bad debt provision
As at 1 January 2022 802,905.09
Provision --
Recovery or reversal 104,938.54
Written-off --
As at 31 December 2022 697,966.55
(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 322,639,159.08
(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 26,363,006,094.32 --
Commercial acceptance notes -- --
Total 26,363,006,094.32 --
5. Prepayments
(1) Disclosed by the ageing of prepayments
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Beijing Shougang Co. Ltd Annual Report 2022
2022.12.31 2021.12.31
Ageing
Amount Proportion (%) Amount Proportion (%)
Within 1 year 630,526,142.92 99.07 1,187,511,241.63 99.58
1 – 2 years 4,353,052.19 0.68 2,390,257.98 0.20
2 – 3 years 859,392.60 0.14 1,787,907.90 0.15
Over 3 years 730,629.27 0.11 880,589.39 0.07
Total 636,469,216.98 100.00 1,192,569,996.90 100.00
(2) As at December 31, 2022, 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 279,454,502.98, accounts for 43.90% of the total amount of prepayments at the end
of the period.
Percentage of total
Company Name 2022.12.31
prepayments (%)
Tangshan Caofeidian Ganglian Logistics Co., Ltd. 87,043,657.93 13.68
Shougang Group Co., Ltd. 74,027,519.11 11.63
Tianjin Freight Center of China Beijing RAILWAY
44,372,578.76 6.97
Administration
Tianjin Jintie Xincheng Freight Forwarding Co., Ltd. 37,899,945.34 5.95
Beijing Hegang Steel Trade Co., Ltd. 36,110,801.84 5.67
Total 279,454,502.98 43.90
6. Other receivables
Item 2022.12.31 2021.12.31
Dividends receivable 200,000.00 --
Other receivables 12,968,697.56 16,992,715.92
Total 13,168,697.56 16,992,715.92
(1) Dividends receivable
Item 2022.12.31 2021.12.31
Guangzhou Jinghai Shipping Co., Ltd. 200,000.00 --
Less: bad debt provision -- --
Total 200,000.00 --
(2) Other receivables
①Disclosed by the ageing of other receivables
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Beijing Shougang Co. Ltd Annual Report 2022
Ageing 2022.12.31 2021.12.31
Within 1 year 9,880,237.95 9,257,052.78
1 – 2 years 3,309,333.81 7,918,680.72
2 – 3 years 143,721.00 649,678.57
3 – 4 years 1,074,861.94 587,104.55
4 – 5 years 813,907.90 503,460.47
Over 5 years 5,143,256.32 5,859,075.32
Subtotal 20,365,318.92 24,775,052.41
Less: provision for bad debts 7,396,621.36 7,782,336.49
Total 12,968,697.56 16,992,715.92
②Disclosed by nature of other receivables
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
Court debit 2,305,049.60 2,305,049.60 --
Total 20,365,318.92 7,396,621.36 12,968,697.56
Continued:
2021.12.31
Item Closing
Provision for bad debts Carrying value
balance
Petty cash 2,928,009.49 423,868.66 2,504,140.83
Deposits 12,643,770.00 812,188.50 11,831,581.50
Due from other companies 6,381,935.32 3,724,941.73 2,656,993.59
Court debit 2,821,337.60 2,821,337.60 --
Total 24,775,052.41 7,782,336.49 16,992,715.92
③Provision for bad debts
As at 31 December 2022, Phase I bad debts provision:
Expected credit
Provision for Reason for
Category Book balance loss within 12 Carrying value
bad debts bad 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
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Beijing Shougang Co. Ltd Annual Report 2022
Expected credit
Provision for Reason for
Category Book balance loss within 12 Carrying value
bad debts bad debts
months (%)
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 Reason
Provision for
Category Book balance loss within the Carrying value for bad
bad debts
lifetime (%) debts
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 Reason
Provision for
Category Book balance loss over the Carrying value for bad
bad debts
lifetime (%) debts
Assessed bad debt provision
individually
People's Court of Muye District,
2,305,049.60 100.00 2,305,049.60 --
Xinxiang City, Henan Province
Petty cash over 5 years 370,720.00 100.00 370,720.00 --
Due from other companies over
3,481,348.72 100.00 3,481,348.72 --
5 years
Total 6,157,118.32 100.00 6,157,118.32 --
As at 31 December 2021, Phase I bad debts provision:
Expected credit
Provision for Reason for
Category Book balance loss within 12 Carrying value
bad debts bad debts
months (%)
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
9,237,576.78 5.00 461,878.85 8,775,697.93
portfolios
Petty cash and deposits 7,797,303.58 5.00 389,865.18 7,407,438.40
Due from other companies 1,440,273.20 5.00 72,013.67 1,368,259.53
Total 9,237,576.78 5.00 461,878.85 8,775,697.93
As at 31 December 2021, Phase II bad debts provision:
Expected credit Reason
Provision for
Category Book balance loss within the Carrying value for bad
bad debts
lifetime (%) debts
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Beijing Shougang Co. Ltd Annual Report 2022
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
9,142,636.31 10.12 925,618.32 8,217,017.99
portfolios
Petty cash and deposits 7,603,755.91 8.88 675,471.97 6,928,283.94
Due from other companies 1,538,880.40 16.26 250,146.35 1,288,734.05
Total 9,142,636.31 10.12 925,618.32 8,217,017.99
As at 31 December 2021，Phase III bad debts provision:
Expected credit Reason
Provision for
Category Book balance loss over the Carrying value for bad
bad debts
lifetime (%) debts
Assessed bad debt provision
individually
Yinchuan Intermediate People's
516,288.00 100.00 516,288.00 --
Court
People's Court of Muye District,
2,305,049.60 100.00 2,305,049.60 --
Xinxiang City, Henan Province
Petty cash over 5 years 170,720.00 100.00 170,720.00 --
Due from other companies over 5
3,402,781.72 100.00 3,402,781.72 --
years
Total 6,394,839.32 100.00 6,394,839.32 --
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)
As at 1 January 2022 461,878.85 925,618.32 6,394,839.32 7,782,336.49
Changes during the year
-- Shift to Phase II -- -- -- --
-- Shift to Phase III -- -- -- --
-- Back to Phase II -- -- -- --
-- Back to Phase I -- -- -- --
Provision 32,133.03 -- -- 32,133.03
Reversal -- 180,127.16 237,721.00 417,848.16
Converse -- -- -- --
Written-off -- -- -- --
Other movements -- -- -- --
As at 31 December 2022 494,011.88 745,491.16 6,157,118.32 7,396,621.36
⑤There is no write-off of provision for bad debts during reporting period.
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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
BMW Brilliance Automotive Security Within 1
6,000,000.00 29.46 300,000.00
Ltd. fund years
Lawsuit of Henan Taihang Court
2,305,049.60 over 5 years 11.32 2,305,049.60
Vibrating Machinery Co., Ltd. debit
Due from
Due from other companies
other 2,000,000.00 over 5 years 9.82 2,000,000.00
over 5 years
companies
Petty cash Petty cash 1,550,710.10 1-5 years 7.61 483,358.60
China Petrochemical Security Within 1
1,039,331.06 5.10 51,966.55
International Co., Ltd. fund years
Total 12,895,090.76 63.31 5,140,374.75
7. Inventories
(1) Classification of inventories
2022.12.31
Item
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 5,232,868,448.19 300,694,621.62 4,932,173,826.57
Consumables 605,976,815.09 -- 605,976,815.09
Self-made semi-finished goods 3,576,657,167.28 -- 3,576,657,167.28
Total 12,303,149,188.97 342,902,440.82 11,960,246,748.15
Continued:
2021.12.31
Item
Book balance Provision for impairment Carrying value
Raw materials 3,773,690,951.92 44,544,258.60 3,729,146,693.32
Finished goods 4,461,908,245.34 102,584,159.77 4,359,324,085.57
Consumables 528,353,704.73 -- 528,353,704.73
Self-made semi-finished goods 3,808,677,560.29 -- 3,808,677,560.29
Total 12,572,630,462.28 147,128,418.37 12,425,502,043.91
(2) Impairment provision for inventories or performance costs
Increase Decrease
Item 2021.12.31 2022.12.31
Reversal or
Provision Others Others
Write-off
Raw materials 44,544,258.60 -- -- 2,336,439.40 -- 42,207,819.20
Finished goods 102,584,159.77 402,994,496.88 -- 204,884,035.03 -- 300,694,621.62
Total 147,128,418.37 402,994,496.88 -- 207,220,474.43 -- 342,902,440.82
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Beijing Shougang Co. Ltd Annual Report 2022
8. Other current assets
Item 2022.12.31 2021.12.31
Input value added tax 2,814,012.14 267,822,797.14
Input value added tax to be certified 655,944,515.37 429,476,806.82
Prepaid income tax 200,264,001.14 20,063,782.91
Entrusted Loans 166,880,103.67 147,227,500.00
Carbon emission rights assets 40,317.17 74,842.65
Total 1,025,942,949.49 864,665,729.52
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Beijing Shougang Co. Ltd Annual Report 2022
9. Long-term equity investments
Movements during the year
Investment
Impairment
gains and Adjustment Cash
Company Name 2022.1.1 Other Provision 2022.12.31 at the end
Additional Reduce losses of other dividend
equity for Others of the year
investment investment confirmed comprehensive or profit
movement impairment
under the income declared
equity method
①Joint ventures
Tangshan Guoxing
36,287,575.86 -- -- 3,895,285.46 -- 385.62 2,000,000.00 -- -- 38,183,246.94 --
Industrial Co., Ltd.
Tangshan Zhonghong
Carbon Chemical Co., 21,536,229.44 -- -- -11,895,926.23 -- -- -- -- -- 9,640,303.21 --
Ltd.
Tangshan Shougang
Jingtang Xishan Coking 1,113,168,103.04 -- -- 28,070,751.94 -- 2,904,776.06 46,000,000.00 -- -- 1,098,143,631.04 --
Co., Ltd.
Subtotal 1,170,991,908.34 -- -- 20,070,111.17 -- 2,905,161.68 48,000,000.00 -- -- 1,145,967,181.19 --
②Associates
Tangshan Tangcao
382,410,987.12 -- -- -69,780,414.90 -- 115,080.97 -- -- -- 312,745,653.19 --
Railway Co., Ltd.
Tangshan Caofeidian
Dunshi New
79,041,891.73 -- -- 925,107.71 -- -- 12,500,000.00 -- -- 67,466,999.44 --
Construction Material
Co., Ltd.
Qian'an Sinochem Coal
Chemical Industrial Co., 1,098,085,352.91 -- -- -206,574,842.59 -- -- -- -- -- 891,510,510.32 --
Ltd.
Beijing Shouxin Jinyuan
Management Consulting
112,715,820.57 -- -- 24,947,007.16 -- -- 15,232,424.74 -- -- 122,430,402.99 --
Center (Limited
Partnership)
Beijing Dingshengcheng
Packaging Materials 13,987,090.36 -- -- 2,843,468.38 -- -- -- -- -- 16,830,558.74 --
Co., Ltd.
Ningbo Shougang
20,677,157.68 -- -- 13,516.21 -- -- 479,668.99 -- -- 20,211,004.90 --
Zhejin Steel Co., Ltd.
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Movements during the year
Investment
Impairment
gains and Adjustment Cash
Company Name 2022.1.1 Other Provision 2022.12.31 at the end
Additional Reduce losses of other dividend
equity for Others of the year
investment investment confirmed comprehensive or profit
movement impairment
under the income declared
equity method
Guangzhou Jinghai
30,589,124.00 -- -- -1,522,712.70 -- -- 200,000.00 -- -- 28,866,411.30 --
Shipping Co., Ltd.
Shougang (Qingdao)
56,603,361.76 -- -- 1,397,364.48 -- -- -- -- -- 58,000,726.24 --
Steel Industry Co., Ltd.
Ordos Baotou Steel
Shourui Material 39,028,999.74 -- 39,193,323.93 164,324.19 -- -- -- -- -- -- --
Technology Co., Ltd.
Tianjin Shougang Steel
Processing&Distribution 20,347,151.86 -- -- -3,703,264.02 -- 49,241.27 -- -- -- 16,693,129.11 --
Co., Ltd.
Hebei Jingji Industry &
7,451,138.24 -- -- 3,176,900.36 -- -- 2,799,259.52 -- -- 7,828,779.08 --
Trading Co., Ltd.
Qian'an Jinyu Shougang
Environmental
33,998,913.97 1,208,074.76 -- 527,580.12 -- -- -- -- -- 35,734,568.85 --
Protection Technology
Co., Ltd.
Subtotal 1,894,936,989.94 1,208,074.76 39,193,323.93 -247,585,965.60 -- 164,322.24 31,211,353.25 -- -- 1,578,318,744.16 --
Total 3,065,928,898.28 1,208,074.76 39,193,323.93 -227,515,854.43 -- 3,069,483.92 79,211,353.25 -- -- 2,724,285,925.35 --
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10. Other equity instrument investments
Item 2022.12.31 2021.12.31
Beijing TIEKE Shougang RAILWAY-TECH Co., Ltd. 197,880,464.00 226,566,944.00
Minmetals Special Steel (Dongguan) Co., Ltd. 4,103,981.86 3,608,571.79
Qian'an Shoujia Construction Material Co., Ltd. 5,456,139.10 13,765,068.94
Qian'an PetroChina Kunlun Gas Co., Ltd 19,084,152.28 14,937,088.81
Minmetals Tianwei Steel Co., Ltd. 6,241,396.57 6,023,090.43
Total 232,766,133.81 264,900,763.97
Continued:
Other
comprehensive
Dividend recognized Accumulated Accumulated income
Item Reasons
during the year gain loss transferred
to retained
earnings
Beijing TIEKE
Shougang
2,812,400.00 188,179,264.00 -- --
RAILWAY-TECH Co.,
Ltd.
Minmetals Special
Steel (Dongguan) Co., -- -- 896,018.14 --
Ltd.
Qian'an Shoujia
Construction Material -- -- 17,410,235.90 --
Co., Ltd.
Qian'an PetroChina
2,802,482.12 17,284,152.28 -- --
Kunlun Gas Co., Ltd
Minmetals Tianwei
-- -- 978,603.43 --
Steel Co., Ltd.
Total 5,614,882.12 205,463,416.28 19,284,857.47 --
11. Other non-current financial assets
Item 2022.12.31 2021.12.31
Financial assets measured at fair value and
79,234,007.60 80,000,000.00
recorded into current profit and loss
Continued:
Item 2022.12.31 2021.12.31
Beijing Shouxin Jin'an Equity Investment
79,234,007.60 80,000,000.00
Partnership (Limited Partnership)
Note: The fair value and investment of Beijing Shouxin Jin'an Equity Investment Partnership
(Limited Partnership) refer to Note Ⅶ. 3 and Note Ⅸ.
12. Fixed assets
Item 2022.12.31 2021.12.31
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Beijing Shougang Co. Ltd Annual Report 2022
Fixed assets 93,331,072,969.17 97,227,169,862.20
Fixed assets to be disposed -- --
Total 93,331,072,969.17 97,227,169,862.20
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Beijing Shougang Co. Ltd Annual Report 2022
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 2022 37,792,567,408.57 42,412,123,945.38 2,546,920,936.91 9,616,910,484.31 1,247,475,999.21 66,252,907,958.61 1,051,560,125.71 160,920,466,858.70
2. Increase 1,206,275,181.97 5,185,702,944.01 289,943,324.55 694,317,859.88 80,643,283.20 -3,741,466,309.74 75,623,199.43 3,791,039,483.30
(1) Purchase 3,195,623.52 32,138,396.08 17,093,084.36 44,511,939.02 188,000.00 26,232,007.07 840,248.86 124,199,298.91
(2) Transferred from
1,203,079,558.45 5,153,564,547.93 272,850,240.19 649,805,920.86 80,455,283.20 -3,767,698,316.81 74,782,950.57 3,666,840,184.39
construction in progress
3. Decrease 64,302,967.36 51,477,877.89 18,411,599.67 5,544,101.52 -- 45,714,201.08 679,033.27 186,129,780.79
(1) Disposal or retirement 64,302,967.36 44,287,490.10 18,411,599.67 5,544,101.52 -- 30,535,620.54 679,033.27 163,760,812.46
(2) Other decreases -- 7,190,387.79 -- -- -- 15,178,580.54 -- 22,368,968.33
4. At 31 December 2022 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
Accumulated depreciation:
1. At 1 January 2022 10,205,522,708.98 14,974,748,302.71 1,654,267,578.30 5,435,628,418.41 578,655,337.28 30,482,174,232.58 362,300,418.24 63,693,296,996.50
2. Increase 2,069,060,491.97 4,635,493,944.85 359,545,483.57 1,130,503,478.30 66,285,323.87 -782,296,390.70 127,894,550.33 7,606,486,882.19
(1) Depreciation 1,159,589,038.26 2,394,221,623.58 200,256,415.24 652,504,341.83 65,980,588.15 2,997,697,043.63 136,237,831.50 7,606,486,882.19
(2) Other increases 909,471,453.71 2,241,272,321.27 159,289,068.33 477,999,136.47 304,735.72 -3,779,993,434.33 -8,343,281.17 --
3. Decrease 22,414,353.38 35,688,387.94 15,527,506.98 5,101,660.72 -- 26,106,271.48 642,106.15 105,480,286.65
(1) Disposal or retirement 22,414,353.38 32,298,406.98 15,527,506.98 5,101,660.72 -- 19,695,172.80 642,106.15 95,679,207.01
(2) Other decreases -- 3,389,980.96 -- -- -- 6,411,098.68 -- 9,801,079.64
4. At 31 December 2022 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
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Beijing Shougang Co. Ltd Annual Report 2022
Machinery and Metallurgical
Item Plant and buildings Motor vechiles Electronic equipment Industrial furnace Other tools Total
equipment equipment
Impaiment
1. At 1 January 2022 -- -- -- -- -- -- -- --
2. Increase -- -- -- -- -- -- -- --
3. Decrease -- -- -- -- -- -- -- --
4. At 31 December 2022 -- -- -- -- -- -- -- --
Carrying value
1. 31 December 2022 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
2. 1 January 2022 27,587,044,699.59 27,437,375,642.67 892,653,358.61 4,181,282,065.90 668,820,661.93 35,770,733,726.03 689,259,707.47 97,227,169,862.20
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Note: As at 31 December 2022, there is no mortgaged or guaranteed fixed assets.
②As at 31 December 2022, there is no temporarily idle fixed assets.
③As at 31 December 2022, fixed assets leased through operating leases are as follows:
Item Carrying value
Plant and buildings 54,375,551.85
④Fixed assets pending certificates of ownership
Item Carrying value Reasons for pending certificates
Building of Beijing Shougang Cold Rolling
34,888,371.00 Property certificate is in the process
Co., Ltd.
Building of Shougang Jingtang United Iron & To be handled after completing the relevant
10,452,783,176.18
Steel Co., Ltd. procedures of the occupied phase I project land
Building of Beijing Shougang Steel Trading
175,670,446.03 Property certificate is in the process
Investment Management Co., Ltd.
13. Construction in progress
Item 2022.12.31 2021.12.31
Construction in progress 7,598,541,035.50 6,566,873,922.61
Construction materials 75,108,817.27 619,893,915.94
Total 7,673,649,852.77 7,186,767,838.55
(1) Construction in progress
①Details of construction in progress
2022.12.31
Item
Book balance Provision for impairment Carrying value
Jingtang Co. Phase-I project 3,076,233,760.72 -- 3,076,233,760.72
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
Other projects 2,986,869,518.14 -- 2,986,869,518.14
Total 7,598,541,035.50 -- 7,598,541,035.50
Continued:
2021.12.31
Item
Book balance Provision for impairment Carrying value
Jingtang Co. Phase-I project 2,042,734,311.07 -- 2,042,734,311.07
Jingtang Co. Phase-II project 21,094,822.03 -- 21,094,822.03
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Beijing Shougang Co. Ltd Annual Report 2022
2021.12.31
Item
Book balance Provision for impairment Carrying value
New energy automotive electrical steel
997,385,082.19 -- 997,385,082.19
project
Zhixin Co. Oriented phase II project 672,933,269.19 -- 672,933,269.19
Other projects 2,832,726,438.13 -- 2,832,726,438.13
Total 6,566,873,922.61 -- 6,566,873,922.61
②The major construction projects in progress are as follows:
Accumulated Capitalized
Transferred to Other % of interest
Project name 2022.1.1 Additions interest Interest during 2022.12.31
fixed assets deduction capitalization
capitalization reporting year
New energy
automotive
997,385,082.19 665,663,669.96 1,625,395,503.61 -- 19,983,166.66 12,335,416.66 4.05 37,653,248.54
electrical steel
project
Zhixin Co.
Oriented phase 672,933,269.19 641,119,636.03 -- -- -- -- -- 1,314,052,905.22
II project
Zhixin Co.
High-end heat
treatment -- 183,731,602.88 -- -- -- -- -- 183,731,602.88
engineering
project
Total 1,670,318,351.38 1,490,514,908.87 1,625,395,503.61 -- 19,983,166.66 12,335,416.66 4.05 1,535,437,756.64
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 %
New energy automotive The project has been provisionally estimated
19.79 94.96 Selfraised
electrical steel project to be transferred to fixed assets
Zhixin Co. Oriented phase The devices of the project are being
16.83 88.23 Selfraised
II project installed
Zhixin Co. High-end heat
treatment engineering 19.49 10.65 The project is undergoing civil construction Selfraised
project
③As at 31 December 2022, there is no provision for impairment of construction in progress.
(2) Construction materials
Item 2022.12.31 2021.12.31
Specific materials 12,234,976.71 17,081,983.66
Specific equipments 62,873,840.56 602,811,932.28
Subtotal 75,108,817.27 619,893,915.94
Provision for impairment of construction
-- --
materials
Total 75,108,817.27 619,893,915.94
14. Right-of-use assets
150
Beijing Shougang Co. Ltd Annual Report 2022
Item Plant and buildings Land use rights Motor vechiles Total
Cost：
1. At 1 January 2022 116,101,586.50 311,888.26 474,802.94 116,888,277.70
2. Increase during the period -124,860.87 -- -- -124,860.87
Adjustment of lease liabilities -124,860.87 -- -- -124,860.87
3. Decrease during the period -- -- -- --
4. At 31 December 2022 115,976,725.63 311,888.26 474,802.94 116,763,416.83
Accumulated depreciation
1. At 1 January 2022 16,440,339.87 55,860.60 112,079.59 16,608,280.06
2. Increase during the period 16,774,378.68 55,860.60 217,538.04 17,047,777.32
(1) Provision 16,774,378.68 55,860.60 217,538.04 17,047,777.32
3. Decrease during the period
4. At 31 December 2022 33,214,718.55 111,721.20 329,617.63 33,656,057.38
Impaiment
1. At 1 January 2022 -- -- -- --
2. Increase during the period -- -- -- --
3. Decrease during the period -- -- -- --
4. At 31 December 2022 -- -- -- --
Carrying value
1. 31 December 2022 82,762,007.08 200,167.06 145,185.31 83,107,359.45
2. 1 January 2022 99,661,246.63 256,027.66 362,723.35 100,279,997.64
Note: As of December 31, 2022, the Company recognizes lease expenses related to short-term
leases and leases of low value assets as shown in Note XIV, 2.
15. Intangible assets
Details of intangible assets
Item Software Land use rights Total
Cost
1. At 1 January 2022 435,479,121.74 4,589,498,925.91 5,024,978,047.65
2. Increase 61,996,396.65 1,946,285.00 63,942,681.65
(1) Purchase 61,996,396.65 1,946,285.00 63,942,681.65
3. Decrease -- -- --
4. At 31 December 2022 497,475,518.39 4,591,445,210.91 5,088,920,729.30
Accumulated amortization
1. At 1 January 2022 122,249,951.73 885,069,827.56 1,007,319,779.29
151
Beijing Shougang Co. Ltd Annual Report 2022
Item Software Land use rights Total
2. Increase 79,524,948.65 95,168,873.25 174,693,821.90
Provision 79,524,948.65 95,168,873.25 174,693,821.90
3. Decrease -- -- --
4. At 31 December 2022 201,774,900.38 980,238,700.81 1,182,013,601.19
Impairment
1. At 1 January 2022 -- -- --
2. Increase -- -- --
3. Decrease -- -- --
4. At 31 December 2022 -- -- --
Carrying value
1. 31 December 2022 295,700,618.01 3,611,206,510.10 3,906,907,128.11
2. 1 January 2022 313,229,170.01 3,704,429,098.35 4,017,658,268.36
Notes for land use rights without completed property rights certificates
Item Carrying value Reason for not completing the property rights certificate
Land of Shougang Qiangang 61,973,257.95 In processing
16. Long-term prepaid expenses
Decrease
Item 2022.1.1 Increase 2022.12.31
Amortization Others
Renovation costs 1,226,463.57 2,898,000.00 588,715.53 -- 3,535,748.04
17. Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets and deferred income tax liabilities without offsetting
2022.12.31 2021.12.31
Item Deductible/taxable Deferred tax Deductible/taxable Deferred tax
temporary differences assets/liabilities temporary differences assets/liabilities
Deferred tax assets：
Asset impairment provision 505,555,574.09 79,322,751.40 337,661,843.04 54,026,814.61
The actual payment amount of
payroll payable less than the 11,804,882.71 1,770,732.41 11,854,543.71 1,778,181.56
withdrawal amount
Defferred income 376,219,302.71 56,819,612.63 222,651,867.20 33,808,482.45
Asset amortization difference 5,629,387.82 844,408.16 6,443,561.93 966,534.25
Unrealized internal transaction 269,210,907.64 40,381,636.15 323,189,435.59 48,478,415.34
Joint commissioning cost 311,745,046.78 46,761,757.02 330,082,990.71 49,512,448.61
Differences in amortization of
3,523,175.04 755,873.27 2,078,979.09 437,933.60
right-of-use assets
152
Beijing Shougang Co. Ltd Annual Report 2022
2022.12.31 2021.12.31
Item Deductible/taxable Deferred tax Deductible/taxable Deferred tax
temporary differences assets/liabilities temporary differences assets/liabilities
Equity Incentive 6,855,496.85 1,052,157.60 4,643,140.32 712,612.87
Deferred income assets for loss
1,164,313,511.12 174,647,026.67 -- --
provision
Subtotal 2,654,857,284.76 402,355,955.31 1,238,606,361.59 189,721,423.29
Deferred tax liabilities：
Joint commissioning cost 1,085,461,580.60 162,819,237.09 1,174,742,095.80 176,211,314.37
Changes in fair value of in other
186,178,558.81 27,926,783.87 218,313,188.97 32,746,978.38
equity instruments investments
New-E Co. disposal subsidiary
Electrical Steel Co. investment 83,212,329.87 20,803,082.47 -- --
income
Fourth quarter equipment
1,938,128,392.15 290,719,258.83 -- --
additional deduction
Subtotal 3,292,980,861.43 502,268,362.26 1,393,055,284.77 208,958,292.75
(2) Details of unrecognized deferred tax assets from deductible temporary differences and
deductible tax losses:
Item 2022.12.31 2021.12.31
Deductible temporary differences 56,162,050.68 111,280,769.32
Deductible tax losses 2,051,259,102.58 136,319,094.41
Total 2,107,421,153.26 247,599,863.73
(3) Unrecognized deferred tax liabilities from deductible tax losses will expire in the following
years:
Years 2022.12.31 2021.12.31 Note
2022 —— 32,710,500.17
2023 33,894,110.96 33,894,110.96
2024 34,063,776.18 34,359,166.04
2025 18,967,253.01 20,479,539.98
2026 14,769,965.09 14,875,777.26
2027 1,949,563,997.34 ——
Total 2,051,259,102.58 136,319,094.41
18. Short-term loans
Classification of short-term loans
Item 2022.12.31 2021.12.31
Pledged loans 1,090,000.00 19,753,215.18
153
Beijing Shougang Co. Ltd Annual Report 2022
Guaranteed loans 6,907,003,333.35 8,787,335,054.82
Credit loans 22,671,912,770.04 16,471,285,046.25
Total 29,580,006,103.39 25,278,373,316.25
Note: The loan of RMB 1,090,000.00 is pledged by a discounted but unmatured and
non-terminatingly recognized note with a carrying value of RMB 1,090,000.00.
19. Notes payable
Item 2022.12.31 2021.12.31
Commercial acceptance notes 7,141,510,000.00 6,915,076,896.08
Bank acceptances 120,000,000.00 573,853,897.69
Total 7,261,510,000.00 7,488,930,793.77
20. Accounts payable
Item 2022.12.31 2021.12.31
Payables for goods 17,215,600,362.40 16,618,588,143.52
Payables for construction 2,594,994,121.65 3,578,906,476.13
Total 19,810,594,484.05 20,197,494,619.65
Among which, the material trade payables aged over 1 year was as follows:
Company name 2022.12.31 Reason for non-settlement
Beijing Shougang Special Steel Co., Ltd. 94,949,940.33 In the execution
Beijing Teyu Plate Co., Ltd. 85,095,430.63 In the execution
Beijing Shougang Resources Comprehensive
57,690,426.64 In the execution
Utilization Technology Development Co., Ltd.
Fujian Longking Co., Ltd. 33,069,015.00 In the execution
Ansteel Construction Group Corp.,Ltd. 25,027,906.68 In the execution
Total 295,832,719.28
21. Contract liabilities
Item 2022.12.31 2021.12.31
Advance from product sales 4,508,016,725.74 5,230,456,327.37
Less: contractual liabilities included in other
-- --
non-current liabilities
Total 4,508,016,725.74 5,230,456,327.37
22. Payroll and employee benefits payable
Item 2022.1.1 Increase Decrease 2022.12.31
Short-term employee benefits 492,938,709.78 4,336,724,255.42 4,236,525,787.96 593,137,177.24
154
Beijing Shougang Co. Ltd Annual Report 2022
Item 2022.1.1 Increase Decrease 2022.12.31
Post-employment benefits (defined
21,456,165.20 497,033,781.76 496,720,694.60 21,769,252.36
contribution plans)
Termination benefits -- 70,727,831.32 70,727,831.32 --
Other retirement benefits due within one year 5,170,000.00 5,890,000.00 5,170,000.00 5,890,000.00
Total 519,564,874.98 4,910,375,868.50 4,809,144,313.88 620,796,429.60
(1) Short-term employee benefits
Item 2022.1.1 Increase Decrease 2022.12.31
Salaries, bonuses and subsidies 97,121,464.93 3,124,590,654.26 3,075,947,905.03 145,764,214.16
Welfare -- 358,005,240.87 358,005,240.87 --
Social insurance 149,464,466.92 345,078,313.01 318,211,452.87 176,331,327.06
Including:
149,116,813.18 305,743,729.80 278,737,241.72 176,123,301.26
1.Medical insurance
2.Work-related injury insurance 346,094.64 39,244,991.20 39,384,555.19 206,530.65
3.Maternity insurance 1,559.10 89,592.01 89,655.96 1,495.15
Housing fund 50,567.00 343,748,321.29 343,746,789.29 52,099.00
Labor union fee and employee education fee
246,302,210.93 121,444,215.02 96,756,888.93 270,989,537.02
employee education fee
Equity incentive -- 43,289,500.60 43,289,500.60 --
Short-term profit-sharing plan -- -- -- --
Non-monetary benefits -- -- -- --
Other short-term employee benefits -- 568,010.37 568,010.37 --
Total 492,938,709.78 4,336,724,255.42 4,236,525,787.96 593,137,177.24
(2) Defined contribution plans
Item 2022.1.1 Increase Decrease 2022.12.31
Post-employment benefits 21,456,165.20 497,033,781.76 496,720,694.60 21,769,252.36
Including:
9,325,670.10 479,074,594.41 478,745,713.64 9,654,550.87
1.Pension insurance
2.Unemployment insurance 12,130,495.10 17,959,187.35 17,974,980.96 12,114,701.49
Total 21,456,165.20 497,033,781.76 496,720,694.60 21,769,252.36
(3) Termination benefits
Item 2022.1.1 Increase Decrease 2022.12.31
Compensation for employee resettlement -- 70,727,831.32 70,727,831.32 --
23. Taxes payable
Item 2022.12.31 2021.12.31
155
Beijing Shougang Co. Ltd Annual Report 2022
Item 2022.12.31 2021.12.31
Value-added tax 112,823,148.09 62,122,718.96
City construction and maintenance tax 939,514.85 8,001,876.62
Corporate income tax 6,615,902.30 317,223,625.65
Land use tax 440,536.03 440,536.03
Real estate tax 1,014,521.32 869,141.45
Education surcharge 681,006.31 6,022,083.47
Resouorce tax 4,912,568.40 7,531,618.50
Stamp duty 33,470,591.03 8,864,862.42
Individual income tax 2,812,207.41 3,797,661.67
Environment protection tax 8,567,976.00 10,336,189.53
Other taxes 22,444.66 --
Total 172,300,416.40 425,210,314.30
24. Other payables
Item 2022.12.31 2021.12.31
Dividends payable 11,440,046.38 --
Other payables 2,750,379,230.31 3,082,192,028.33
Total 2,761,819,276.69 3,082,192,028.33
(1) Dividends payable
Item 2022.12.31 2021.12.31
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 2022.12.31 2021.12.31
Deposits 6,137,315.23 6,242,141.60
Guarantee 35,705,705.74 35,537,715.10
Due from Shougang Group 56,575,231.05 57,154,287.37
Due from Shougang Mining Corp. 796,194,091.55 2,066,250,402.53
Restricted stock repurchase obligations 210,930,850.00 210,930,850.00
Zhixin Co's second round of financing 990,787,728.36 --
156
Beijing Shougang Co. Ltd Annual Report 2022
Item 2022.12.31 2021.12.31
Due from other companies 654,048,308.38 706,076,631.73
Total 2,750,379,230.31 3,082,192,028.33
25. Current portion of non-current liabilities
Item 2022.12.31 2021.12.31
Long-term loans due within one year 1,480,490,424.42 10,404,580,520.24
Bonds payable due within one year 2,528,468,055.61 28,468,055.61
Long-term payables due within one year 15,781,907.85 3,407,794.44
Lease liabilities due within one year 14,027,634.72 14,837,257.91
Total 4,038,768,022.60 10,451,293,628.20
(1) Long-term loans due within one year
Item 2022.12.31 2021.12.31
Guaranteed loans 613,355,833.34 413,924,166.67
Credit loans 867,134,591.08 9,990,656,353.57
Total 1,480,490,424.42 10,404,580,520.24
(2) Bonds payable due within one year
Item 2022.12.31 2021.12.31
20 shouqian 01 (Accrued interest) 2,528,468,055.61 28,468,055.61
(3) Long-term payables due within one year
Item 2022.12.31 2021.12.31
Finance lease payables 15,781,907.85 3,407,794.44
26. Other current liabilities
Item 2022.12.31 2021.12.31
Short-term bonds payable 1,006,213,698.66 1,007,299,452.05
Tax to be exported 724,801,203.37 901,212,275.43
Backed notes 6,357,735,008.71 6,313,495,809.15
Total 8,088,749,910.74 8,222,007,536.63
Short-term bonds payable:
Bond name Nominal value Issue date Maturity of bond Issue amount
SCP1 1,000,000,000.00 2021/9/16 239 days 1,000,000,000.00
SCP2 1,000,000,000.00 2022/5/20 188 days 1,000,000,000.00
157
Beijing Shougang Co. Ltd Annual Report 2022
Bond name Nominal value Issue date Maturity of bond Issue amount
SCP3 1,000,000,000.00 2022/8/19 248 days 1,000,000,000.00
Subtotal 3,000,000,000.00 3,000,000,000.00
Short-term Bonds Payable (continued):
Interest Amortization
Issued during Repaid in the
Bond name 2022.1.1 accrued per of premium 2022.12.31
current period current period
nominal value and discount
SCP1 1,007,299,452.05 -- 9,004,931.51 -- 1,016,304,383.56 --
SCP2 -- 1,000,000,000.00 10,301,369.86 -- 1,010,301,369.86 --
SCP3 -- 1,000,000,000.00 6,213,698.66 -- -- 1,006,213,698.66
Total 1,007,299,452.05 2,000,000,000.00 25,520,000.03 -- 2,026,605,753.42 1,006,213,698.66
27. Long-term loans
Range of interest Range of interest
Item 2022.12.31 2021.12.31
rate rate
Guaranteed loans 9,413,355,833.34 4.65% 9,813,924,166.67 4.75%-4.90%
Credit loans 2,661,484,591.08 2.85%-3.85% 12,283,366,353.57 3.5%-4.90%
Subtotal 12,074,840,424.42 22,097,290,520.24
Less: Long-term loans due
1,480,490,424.42 2.85%-4.65% 10,404,580,520.24 3.5%-4.90%
within one year
Total 10,594,350,000.00 11,692,710,000.00
28. Bonds payable
Item 2022.12.31 2021.12.31
Common bond -- 2,500,000,000.00
Increase or decrease in bonds payable
Bond name Par value Issue date Term to maturity Amount on offer
20 shouqian 01 2,500,000,000.00 2020/9/15 5 years 2,500,000,000.00
Bonds payable (continued):
Current year Accrued Amortisation Current year
Bond name 2022.1.1 interest by 2022.12.31
issuance par value of discount repayment
20 shouqian 01 2,528,468,055.61 -- 99,500,000.00 -- 99,500,000.00 2,528,468,055.61
Less: Long-term
loans due within 28,468,055.61 -- -- -- -- 2,528,468,055.61
one year
Total 2,500,000,000.00 -- -- -- -- --
29. Lease liabilities
158
Beijing Shougang Co. Ltd Annual Report 2022
Item 2022.12.31 2021.12.31
Lease liabilities 86,467,471.51 100,960,468.26
Less: lease liabilities due within one year 14,027,634.72 14,837,257.91
Total 72,439,836.79 86,123,210.35
Note: The amount of interest expense of lease liabilities in 2022 is RMB 4,408,691.60, which
is included in financial expense - interest costs.
30. Long-term payables
Item 2022.12.31 2021.12.31
Long-term payables -- 12,359,657.85
Special payables 2,300,000.00 2,300,000.00
Total 2,300,000.00 14,659,657.85
(1) Long-term payables
Item 2022.12.31 2021.12.31
Finance lease payables 15,781,907.85 15,767,452.29
Less: Long-term payables due within one
15,781,907.85 3,407,794.44
year
Total -- 12,359,657.85
(2) Special payables
Item 2022.1.1 Increase Decrease 2022.12.31 Reason
Research and development funds 2,300,000.00 -- -- 2,300,000.00
31. Long-term employee benefits payables
Item 2022.12.31 2021.12.31
Termination benefits 23,239,569.30 21,310,000.00
Other long-term benefits 65,216,081.72 64,980,000.00
Subtotal 88,455,651.02 86,290,000.00
Less: Long-term Employee benefits
5,890,000.00 5,170,000.00
payables due within one year
Total 82,565,651.02 81,120,000.00
32. Deferred revenue
Item 2022.1.1 Increase Decrease 2022.12.31 Reason
Government grant 404,010,785.39 108,685,396.00 39,834,299.49 472,861,881.90
Note: The government grants which recognized as deferred revenue refer to Note V. 60 government
grants.
159
Beijing Shougang Co. Ltd Annual Report 2022
33. Other non-current liabilities
Item 2022.12.31 2021.12.31
Shougang Group advance payment for construction 4,532,018,467.20 4,563,283,607.60
34. Share capital
Changes in current (+/-)
Item 2022.1.1 2022.12.31
Bonus Shares transferred
Shares issued Others Subtotal
issue from reserves
Total amount
6,750,325,410.00 1,069,543,760.00 -- -- -- 1,069,543,760.00 7,819,869,170.00
of shares
Note: ①On March 31, 2022, the Company issued 1,015,417,369.00 new shares to purchase 49.00%
shares of Beijing Shougang Steel Trade Investment Management Co., Ltd held by Shougang Group
Co., Ltd. Grant Thornton LLP examined the newly added share capital and issued the capital
verification report of GTYZ (2022) No.110C000177；②On May 20, 2022, the Company issued a
total of 54,126,391 new shares in the non-public offering to eight subjects, with a price of RMB
5.38 per share. After this offering, the registered capital of the Company changed to RMB
7,819,869,170.00. Grant Thornton LLP examined the newly added share capital and issued the
capital verification report GTYZ (2022) No.110C000271.
35. Capital reserve
Item 2022.1.1 Increase Decrease 2022.12.31
Share premium 24,856,733,491.93 4,738,436,210.82 -- 29,595,169,702.75
Other capital reserve 5,043,149.79 43,835,698.96 -- 48,878,848.75
Total 24,861,776,641.72 4,782,271,909.78 -- 29,644,048,551.50
Note: the movement of other capital reserve is the change in other equity of joint ventures
recognized by the Company in accordance with shareholding ratio and equity incentive
amortization expense.
36. Treasury shares
Item 2022.1.1 Increase Decrease 2022.12.31
Restricted stock incentive plan 210,930,850.00 -- -- 210,930,850.00
37. Other comprehensive income
Other comprehensive income attributable to the parent company in the balance sheet:
During the period
Item 2022.1.1 Less: Transferred from other 2022.12.31
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
185,566,210.59 -27,314,435.65 -- 158,251,774.94
reclassified into profits or
losses
160
Beijing Shougang Co. Ltd Annual Report 2022
Changes in fair value of
other equity instrument 185,566,210.59 -27,314,435.65 -- 158,251,774.94
investments
II. Other comprehensive
income to be reclassified -- -- -- --
into profits or losses
Total other
185,566,210.59 -27,314,435.65 158,251,774.94
comprehensive incomes
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
-32,134,630.16 -- -4,820,194.51 -- -27,314,435.65
cannot be
reclassified into
profits or losses
Changes in fair
value of other equity
-32,134,630.16 -- -4,820,194.51 -- -27,314,435.65
instrument
investments
II. Other
comprehensive
income to be -- -- -- -- --
reclassified into
profits or losses
Total other
comprehensive -32,134,630.16 -- -4,820,194.51 -- -27,314,435.65
incomes
Note: The net-of-tax amount of other comprehensive income for the period is RMB -27,314,435.65,
Among which, the net-of-tax amount of other comprehensive income attributable to the parent
company is RMB -27,314,435.65; and net-of-tax amount of other comprehensive income
attributable to minority shareholders is RMB 0.00.
38. Special reserve
Item 2022.1.1 Increase Decrease 2022.12.31
Safety fund 21,054,371.78 110,550,791.17 99,752,852.16 31,852,310.79
39. Surplus reserve
Item 2022.1.1 Increase Decrease 2021.12.31
Statutory reserve 1,908,883,208.67 -- -- 1,908,883,208.67
Discretionary surplus
-- -- -- --
reserve
Total 1,908,883,208.67 -- -- 1,908,883,208.67
40. Retained earnings
161
Beijing Shougang Co. Ltd Annual Report 2022
Appropriation/
Item 2022 2021 Distribution
ratio
Retained earnings at previous year before adjustment 8,130,868,205.38 1,865,280,919.23 --
Adjustment of total retained earnings at previous year
-- -- --
(Increase in “+”, decrease in “-”)
Retained earnings at previous year after adjustment 8,130,868,205.38 1,865,280,919.23
Add: Net profit attributable to shareholders of the company 1,124,540,659.14 7,106,480,663.26 --
Less: Transfer to statutory surplus reserve -- 80,205,362.30
Transfer to discretionary surplus reserve -- --
Common Stock dividends payable 625,589,533.60 668,542,361.00
Dividends payable to other equity holders 34,120,631.40 92,145,653.81
Retained earnings at current year 8,595,698,699.52 8,130,868,205.38
Including: Surplus reserve attributable to shareholders of
-- --
the company extracted by subsidiaries
41. Revenue and cost of sales
(1) Revenue and cost of sales
2022 2021
Item
Revenue Cost of sales Revenue Cost of sales
Main business 114,602,567,434.30 108,013,843,862.04 129,315,463,715.41 114,564,031,235.41
Other business 3,539,616,115.17 3,053,711,458.24 3,668,840,952.87 2,830,663,835.12
Total 118,142,183,549.47 111,067,555,320.28 132,984,304,668.28 117,394,695,070.53
(2) Revenue and cost of sales presented as products
2022 2021
Item
Revenue Cost of sales Revenue Cost of sales
Main business:
Billet 546,474,748.00 473,163,072.64 577,251,931.16 529,612,988.15
Hot-rolled steel 48,304,009,189.85 46,623,686,161.87 55,678,740,307.61 49,137,279,925.26
Cold-rolled steel 63,569,306,854.33 59,017,610,809.13 69,900,266,273.35 62,263,262,571.46
Other steels 2,182,776,642.12 1,899,383,818.40 3,159,205,203.29 2,633,875,750.54
Subtotal 114,602,567,434.30 108,013,843,862.04 129,315,463,715.41 114,564,031,235.41
Other business
Power 1,386,026,949.59 1,380,897,100.66 1,151,297,257.25 1,090,178,413.66
Solid waste 1,338,134,781.31 1,199,982,844.66 1,705,579,006.40 1,385,103,949.54
Others 815,454,384.27 472,831,512.92 811,964,689.22 355,381,471.92
Subtotal 3,539,616,115.17 3,053,711,458.24 3,668,840,952.87 2,830,663,835.12
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Beijing Shougang Co. Ltd Annual Report 2022
2022 2021
Item
Revenue Cost of sales Revenue Cost of sales
Total 118,142,183,549.47 111,067,555,320.28 132,984,304,668.28 117,394,695,070.53
(3) Breakdown of revenue information
Item 2022
Revenue from main business 114,602,567,434.30
Including: recognised at a certain point in time 114,602,567,434.30
recognised during a certain period of time --
Revenue from other business 3,539,616,115.17
Total 118,142,183,549.47
As of 31 December 2022, the amount of revenue corresponding to the performance obligations
that the company has signed but not yet fulfilled is RMB 4,396.548 million. The Company
expects to recognize all the revenue in 2023.
42. Taxes and surcharges
Item 2022 2021
Environmental protection tax 33,744,422.88 39,374,373.13
Urban maintenance and construction tax 101,654,296.06 240,494,550.69
Education surcharge 74,499,878.54 173,874,358.48
Resources duty 41,927,760.60 51,626,025.36
Property tax 197,700,840.52 196,202,384.06
Land usage tax 221,682,543.86 223,625,023.01
Vehicle and vessel usage tax 336,360.10 336,864.01
Stamp duty 151,537,114.35 138,546,538.99
Other taxes 177,866.02 349,770.25
Total 823,261,082.93 1,064,429,887.98
Note: The provision and payment standards of taxes and surcharges refer to Note IV. Taxation.
43. Selling and distribution expenses
Item 2022 2021
Staff costs 183,609,735.80 174,833,606.06
Depreciation and amortization 107,397.02 131,640.69
Other regualr expenses 54,279,893.40 38,344,287.63
Total 237,997,026.22 213,309,534.38
44. General and administrative expenses
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Beijing Shougang Co. Ltd Annual Report 2022
Item 2022 2021
Staff costs 668,044,773.52 700,517,923.75
Depreciation and amortization 336,647,438.61 310,789,699.88
Other regular expenses 266,483,526.93 289,890,312.57
Total 1,271,175,739.06 1,301,197,936.20
45. Research and development expenses
Item 2022 2021
Staff costs 575,278,177.87 600,350,698.99
Other regular expenses 51,645,079.49 52,575,686.57
Total 626,923,257.36 652,926,385.56
46. Financial expenses
Item 2022 2021
Interest costs 1,876,045,277.79 2,360,994,534.74
Including: Interest expenses on lease liabilities 4,408,691.60 4,895,508.99
Less: interest capitalized 12,335,416.66 7,647,750.00
Interest expenses 1,863,709,861.13 2,353,346,784.74
Less:interest income 132,829,545.65 131,307,065.33
Discount on notes acceptance 22,128,963.88 31,976,398.68
Exchange losses and gains -29,489,525.05 9,582,515.98
Bank charges and others 8,064,537.04 -3,192,601.27
Total 1,731,584,291.35 2,260,406,032.80
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 the current period is 4.05% (previous period: 4.05%).
47. Other income
Item 2022 2021
Related to assets 39,401,467.49 24,060,120.26
Related to income 33,934,028.23 24,387,236.26
Value added tax deduction 646,083.96 4,210,393.94
Tax refund 2,160,426.28 1,886,738.46
Total 76,142,005.96 54,544,488.92
Note: (1) The details of government grants refer to Note V. 60 Government grants.
(2) The specific reasons for government grants recognized as recurring gains or losses, please refer
164
Beijing Shougang Co. Ltd Annual Report 2022
to Note XVI. 1.
48. Investment income
Item 2022 2021
Investment income from long-term equity investments
-227,515,854.43 93,142,769.92
under the equity method
Investment income on disposal of long-term equity
-583,440.77 --
investments
Dividend from other equity instruments investments 5,614,882.12 2,718,777.38
Interest income from entrusted loans 11,275,389.73 10,518,170.49
Total -211,209,023.35 106,379,717.79
49. Gains from changes in fair value
Sources of gains from changes in fair value 2022 2021
Other non-current financial assets: designated as measured
at fair value and whose changes are recorded in current -765,992.40 --
profit or loss
50. Credit impairment losses (loss in “-”)
Item 2022 2021
Provision for bad debts of notes receivable 139,430.10 -713,475.06
Provision for bad debts of accounts receivable 5,013,380.11 -9,079,090.99
Provision for bad debts of financing receivable 104,938.54 103,604.74
Provision for bad debts of other receivables 385,715.13 282,710.81
Provision for bad debts of other current assets -- -118,133,658.14
Total 5,643,463.88 -127,539,908.64
51. Impairment losses on assets (loss in “-”)
Item 2022 2021
Provision for invertory impairment -402,994,496.88 -167,567,546.04
52. Gains on disposal of assets
Item 2022 2021
Gains from disposal of fixed assets (loss in “-”) -611,088.11 385,299.27
Gains from disposal of intangible assets (loss in “-”) -- 3,331,185.95
Total -611,088.11 3,716,485.22
53. Non-operating income
Recognised as
Item 2022 2021 non-recurring gains or
losses in 2022
165
Beijing Shougang Co. Ltd Annual Report 2022
Gains on disposal of assets s 5,051,368.61 4,449,256.58 5,051,368.61
Compensation payments 243,985.86 10,638.10 243,985.86
Others 6,008,845.31 2,094,300.29 6,008,845.31
Total 11,304,199.78 6,554,194.97 11,304,199.78
54. Non-operating expenses
Recognised as non-recur
Item 2022 2021 ring gains or losses in
2022
Losses on disposal of assets 61,414,433.22 63,892,628.48 61,414,433.22
Compensation and penalty 17,550.00 727.98 17,550.00
Carbon emission quota trading 5,264,317.89 1,464,983.15 5,264,317.89
Others 407,108.31 162,953.79 407,108.31
Donation 978,613.90 -- 978,613.90
Total 68,082,023.32 65,521,293.40 68,082,023.32
55. Income tax expenses
(1) Details of income tax expenses
Item 2022 2021
Current tax in accordance with tax laws and related
219,005,828.78 1,578,636,762.92
regulations
Deffered income tax expenses 64,692,649.53 -89,407,543.66
Total 283,698,478.31 1,489,229,219.26
(2) Reconciliation between income tax expenses and profit before income tax is as follows:
Item 2022 2021
Profit before tax 1,793,113,877.83 9,907,905,959.65
Tax at the applicable tax rate of 15% 268,967,081.67 1,486,185,893.95
Taxation effect of different tax rates of subsidiaries 9,416,049.20 9,147,288.50
Adjustment of income tax in the prior year -167,423.08 10,277,388.90
Share of profit or loss of joint ventures and associates
37,956,945.34 -5,776,903.71
under the equity method
Income not subject to tax（expressed in“-”） -842,232.32 -407,816.61
Non-deductible costs, expenses and losses 9,328,763.06 3,816,854.15
Taxation effect of the change in the applicable tax rate on
-- --
the beginning disclosure of the deffered income tax
Taxation effect of utilizing previous unrecognized tax
losses and deductible temporary differences (expressed in -39,016,139.47 -28,888,868.85
“-”)
Taxation effect of unrecognized tax losses and deductible
296,879,494.17 6,106,882.02
temporary differences
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Beijing Shougang Co. Ltd Annual Report 2022
Item 2022 2021
Taxation effect of research and development expenses
-7,022,222.63 --
(expressed in “-”)
Others -291,801,837.63 8,768,500.91
Income tax expenses 283,698,478.31 1,489,229,219.26
56. Notes to cash flow statement
(1) Proceeds from other operating activities
Item 2022 2021
Government grants received 144,356,668.51 54,359,336.26
Security deposit received 7,797,264.28 3,208,000.00
Other non-operating income received 6,252,831.17 2,104,938.39
Other receivables received 907,256.25 3,663,851.17
Restricted funds received 607,900,032.50 --
Total 767,214,052.71 63,336,125.82
(2) Payments for other operating activities
Item 2022 2021
Expenses paid 386,282,467.41 435,051,105.11
Non-operating expenses paid 6,667,590.10 1,628,664.92
Restricted funds paid -- 416,155,620.25
Total 392,950,057.51 852,835,390.28
(3) Proceeds from other investing activities
Item 2022 2021
Interest income 132,789,335.69 130,931,269.04
(4) Payment for other investing activities
Item 2022 2021
Jinshi Investment Co., Ltd. -- 300,000,000.00
(5) Payment for other financing activities
Item 2022 2021
Financial commissions 1,087,113.74 1,735,566.18
Paying back the borrowings from Shougang Group 102,661,561.32 917,013,635.51
Lease payments 18,776,827.47 18,974,740.74
Non-public offering fees paid 14,443,431.52 18,562,551.86
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Beijing Shougang Co. Ltd Annual Report 2022
Return the loan to Wuhan Zhongxin -- 2,800,000.00
Return Liuzhou Shougang Automobile Co. minority
-- 4,996,112.27
shareholders investment funds
Total 136,968,934.05 964,082,606.56
57. Supplements to statement of cash flows
(1) Supplementary information
Supplementary information 2022 2021
1. Reconciliation of net profit to net cash flows from
operating activities:
Net profit 1,509,415,399.52 8,418,676,740.39
Add: Impairment losses on assets 402,994,496.88 167,567,546.04
Credit impairment losses -5,643,463.88 127,539,908.64
Depreciation of fixed assets 7,606,486,882.19 7,378,106,118.45
Depreciation of right-of-use assets 17,047,777.32 16,608,280.06
Amortization of intangible assets 174,693,821.90 138,072,177.23
Amortizaiton of long-term deffered expenses 588,715.53 345,030.83
Losses on disposal of fixed assets, intangible assets and
611,088.11 -3,716,485.22
other long-term assets (Gains as in “-”)
Losses on written-off fixed assets (Gains as in “-”) 56,363,064.61 59,443,371.90
Losses on fair value changes (Gain as in “-”) 765,992.40 --
Financial expenses (Income as in “-”) 1,731,584,291.35 2,260,406,032.80
Investment losses (Income as in “-”) 211,209,023.35 -106,379,717.79
Decrease in deferred tax assets
-212,634,532.02 -41,819,052.19
(Increase as in “-”)
Increase in deferred tax liabilities
277,327,181.55 -47,588,491.47
(Decrease as in “-”)
Decrease in inventories (Increase as in “-”) -344,414,864.08 -1,447,427,404.02
Decrease in receivables from
850,893,260.68 -2,744,997,757.88
operating activities (Increase as in “-”)
Increase in payables from
-2,898,834,775.85 1,627,023,348.36
operating activities (Decrease as in “-”)
Others 665,782,138.24 -408,669,801.90
Net cash flow from operating activities 10,044,235,497.80 15,393,189,844.23
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 -- --
3. Net changes in cash and cash equivalents:
Closing balance of cash 8,329,215,003.68 8,535,871,373.08
Less: Opening balance of cash 8,535,871,373.08 4,959,913,916.36
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Beijing Shougang Co. Ltd Annual Report 2022
Supplementary information 2022 2021
Add: Closing balance of cash equivalents -- --
Less: Opening balance of cash equivalents -- --
Net increase in cash and cash equivalents -206,656,369.40 3,575,957,456.72
Note: The amount of endorsement and transfer of acceptance notes received from goods sales of the
Company is RMB 79,259,034,500.00.
(2) Components of cash and cash equivalents
Item 2022.12.31 2021.12.31
1. Cash 8,329,215,003.68 8,535,871,373.08
Including: Cash on hand 23,581.90 53,404.48
Balances in banks without restriction 8,329,191,409.04 8,535,817,955.86
Digital currency without restriction -- --
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 8,329,215,003.68 8,535,871,373.08
Including: restricted cash and cash equivalents from the
-- --
parent company or its subsidiaries
58. Notes to Statement of Changes in Shareholders' Equity
Note: Item with material amounts in ‘VI. Others’ is the transitional net profit of the pelletizing
-sintering business of Shougang Mining Corporation from July to November 2022 under common
control of RMB 21,283,644.68. The above event increases the combined capital reserve of RMB
-21,283,644.68.
59. Restricted assets
Item 2022.12.31 Restricted reasons
Security deposits, fixed term
Cash and cash balances 1,140,407,749.24
deposits
Notes receivable 328,829,159.08 Pledge billing
Accounts receivable 24,223,581.32 Pledge billing
Total 1,493,460,489.64
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Beijing Shougang Co. Ltd Annual Report 2022
60. Government grants
(1) Government grants recognized as deferred income and subsequently measured via gross method.
Transfer to Item recognized in Related to assets/
Item Type 2022.1.1 Increase Other changes 2022.12.31
profit or loss income statement Related to income
Financial
Discount funds for imported equipments 13,335,340.67 -- 1,229,110.56 -- 12,106,230.11 Other income Related to assets
appropriation
Government grants for engineering informationization project (Qian'an Financial
375,000.24 -- 99,999.96 -- 275,000.28 Other income Related to assets
Iron and Steel, Cold-R Co.) appropriation
Government grants for energy central project from the Ministry of Financial
4,000,000.24 -- 2,000,000.36 -- 1,999,999.88 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 4,200,000.00 -- 60,869.58 -- 4,139,130.42 Other income Related to assets
appropriation
Financial
Government grants for hot-rolled steel strip TMCP project 1,368,421.04 -- 105,263.16 -- 1,263,157.88 Other income Related to assets
appropriation
Government grants for dedusting system upgrading project (Qian'an Financial
26,105,263.24 -- 1,631,578.92 -- 24,473,684.32 Other income Related to assets
Iron and Steel) appropriation
Financial
Government grants for advanced sewage treatment 5,161,851.80 -- 342,222.24 -- 4,819,629.56 Other income Related to assets
appropriation
Special government grants for denitration engineering from the Hebei Financial
735,000.00 -- 245,000.00 -- 490,000.00 Other income Related to assets
Provincial Finance Department appropriation
Government grants for online environmental monitoring project from Financial
3,000,000.00 -- 500,000.00 -- 2,500,000.00 Other income Related to assets
the Finance Bureau of Caofeidian appropriation
The steelmaking technology and facilities demonstration project through
Financial
carbon dioxide-oxygen mixed injection, funded by University of 3,929,824.56 -- 210,526.32 -- 3,719,298.24 Other income Related to assets
appropriation
Science and Technology Beijing
Financial
National funds for the national 863 project 834,600.00 -- 278,200.00 -- 556,400.00 Other income Related to assets
appropriation
Financial
Government grants for Phase II seawater dsalination project 17,894,736.88 -- 1,052,631.56 -- 16,842,105.32 Other income Related to assets
appropriation
Financial
Government grants for cold-rolled intelligent manufacturing project 11,587,500.00 11,470,000.00 1,832,947.36 -- 21,224,552.64 Other income Related to assets
appropriation
Government grants for R & D and demonstration projects of seawater Financial
8,700,000.00 -- 8,700,000.00 -- -- Other income Related to assets
dsalination based on reuse of steelmaking waste heat appropriation
Financial
Government grants for the desulfurization of pelletizing flue gas 22,291,578.94 -- 1,486,105.28 -- 20,805,473.66 Other income Related to assets
appropriation
Financial
Environmental protection government grants for closing limestone yards 1,680,000.00 -- 80,000.00 -- 1,600,000.00 Other income Related to assets
appropriation
Government grants for intelligent interface closed-loop control Financial
2,400,000.00 -- 2,400,000.00 -- -- Other income Related to assets
technology in multi-target optimize steelmaking and ironmaking appropriation
Government grants for new metal, ceramic composite powder, and Financial
838,100.00 -- 838,100.00 -- -- Other income Related to assets
refractory anticorrosion coating appropriation
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Beijing Shougang Co. Ltd Annual Report 2022
Transfer to Item recognized in Related to assets/
Item Type 2022.1.1 Increase Other changes 2022.12.31
profit or loss income statement Related to income
Government grants for intelligent collaborative allocation techonglogy Financial
2,350,000.00 -- 2,350,000.00 -- -- Other income Related to assets
about material flow and power flow in steelmaking program appropriation
Government grants for energy-saving incentive for No.3 hydrogen Financial
1,018,184.17 -- 67,878.96 -- 950,305.21 Other income Related to assets
generator appropriation
Government grants for cold rolling operation department aluminized Financial
3,065,263.13 -- 191,578.96 -- 2,873,684.17 Other income Related to assets
silicon high strength steel automotive plate renovation project appropriation
Government grants for cold rolling operation department high strength Financial
11,900,000.00 -- 449,056.60 -- 11,450,943.40 Other income Related to assets
steel 18 roll single stand project appropriation
Government grants for the operation-control system of Financial
20,390,000.00 -- 617,878.80 -- 19,772,121.20 Other income Related to assets
production-marketing integration appropriation
Government grants for green and intelligent collaborative mechanism of Financial
580,000.00 -- 580,000.00 -- -- Other income Related to assets
steel process and comprehensive energy efficiency assessment appropriation
Government grants for the specialized production line project of Financial
89,473,684.24 -- 5,263,157.88 -- 84,210,526.36 Other income Related to assets
Zinc-plated high-strengthen auto sheet appropriation
Government grants for reforming of sinter desulfurization and Financial
25,789,473.70 -- 1,578,947.36 -- 24,210,526.34 Other income Related to assets
denitrification appropriation
Financial
Government grants for thin slab casting and rolling engineering 5,000,000.00 322,500.00 142,857.14 -- 5,179,642.86 Other income Related to assets
appropriation
Government grants for reform project of reducing oxynitride Financial
6,161,842.15 -- 331,578.84 -- 5,830,263.31 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 -- -- -- 4,800,000.00 Other income Related to assets
appropriation
Financial
Government grants for 10,000 tons/d desalination project 8,431,578.95 -- 468,421.04 -- 7,963,157.91 Other income Related to assets
appropriation
Government grants for enhancing the core competitiveness of the Financial
78,540,000.00 -- -- -- 78,540,000.00 Other income Related to assets
manufacturing industry appropriation
Financial
Government grants for sintering waste heat power generation project -- 20,000,000.00 663,716.81 -- 19,336,283.19 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 -- 24,450,900.00 767,517.04 -- 23,683,382.96 Other income Related to assets
appropriation
Department
Government grants for energy conservation and emission reduction Financial
-- 13,489,900.00 60,606.06 -- 13,429,293.94 Other income Related to assets
optimization and improvement projects appropriation
Financial
Government grants for Zinc containing solid waste disposal project -- 5,000,000.00 121,359.22 -- 4,878,640.78 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 -- 698,509.00 347,537.32 -- 350,971.68 Other income Related to assets
appropriation
Financial
Government grants for high performance oriented silicon steel project -- 19,640,000.00 -- -- 19,640,000.00 Other income Related to assets
appropriation
Financial
Other government grants related to assets 17,683,541.44 6,530,755.00 2,306,820.16 -- 21,907,476.28 Other income Related to assets
appropriation
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Beijing Shougang Co. Ltd Annual Report 2022
Transfer to Item recognized in Related to assets/
Item Type 2022.1.1 Increase Other changes 2022.12.31
profit or loss income statement Related to income
Financial
Other government grants related to income 390,000.00 82,832.00 432,832.00 -- 40,000.00 Other income Related to income
appropriation
Total 404,010,785.39 108,685,396.00 39,834,299.49 -- 472,861,881.90
(2) Government grants directly recorded as profit or loss for the current period and measured via gross method.
Amount recognised in profit or loss in Amount recognised in profit or loss in Item recognized in Related to assets/
Item Type
prior period the period income statement Related to income
Government grants for steady post Financial appropriation 7,773,848.31 7,645,337.02 Other income Related to income
Government grants for promoting the
development of enterprises operate in the Financial appropriation -- 2,700,000.00 Other income Related to income
region
Other government grants related to income Financial appropriation 25,727,347.92 14,041,899.24 Other income Related to income
Total 33,501,196.23 24,387,236.26
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Beijing Shougang Co. Ltd Annual Report 2022
VI. Changes in the scope of consolidation
Business combination under common control
(1) Business combination under common control occurring in the current period. (Unit: RMB
0,000)
Net profit of
Revenue of the the combined
The
The basis for the combined party party from the Net profit of
proportion of
business from the beginning of Revenue of the the combined
Name of the combined equity Combination
combinations beginning of the the combined party in party in the
party acquired in date
under the consolidation consolidation the previous period previous
business
common control period to the date period to the period
combination
of consolidation date of
consolidation
The pelletizing -sintering Under the control
business of Shougang Mining 100.00% of the same parent 2022/11/30 1,024,765.19 5,540.43 1,307,612.22 9,214.57
Corporation company
On November 15, 2022, upon the approval of the third interim shareholders' meeting in 2022, the
Company acquired the effective operating assets and liabilities of the pelleting and sintering
(pelletizing-sintering) process held by the Shougang Mining Corporation (hereinafter referred to as
Shougang Mining Corp.) in cash. The pelletizing -sintering business is evaluated on June 30, 2022
as the base date, and its net assets are evaluated at RMB 1,300,325,799.36. On November 28, 2022,
the Company signed the Asset Purchase Agreement with Shougang Mining Corp., which
determined November 30, 2022 as the delivery date of the acquisition. The final price of the assets
purchased is RMB 1,300,325,799.36. The Company has paid the initial purchase price of RMB
650,162,899.68 on December 7, 2022, and the remaining purchase price will be paid in accordance
with the agreement.
The pelletizing -sintering business was originally a subsidiary of Shougang Group, the parent
company of the Company. Since both parties were controlled by Shougang Group before and after
the combination and the control was not temporary, this acquisition is a combination of businesses
under common control. The Company completed the delivery and continuation of the assets,
liabilities and personnel of the pelletizing -sintering business on November 30, 2022, and therefore
the combination date was determined to be November 30, 2022. All assets and liabilities acquired
by the Company in the acquisition of the ball-burning business is measured at the book value of the
combined party on the combination date.
(2) Acquisition costs
The pelletizing -sintering business of Shougang Mining
Item
Corporation
Cash 1,300,325,799.36
Book value of debt assumed
The total of the acquisition costs 1,300,325,799.36
(3) Assets and liabilities of the merged party
The pelletizing -sintering business of Shougang Mining Corporation
Item
2022.11.30 2021.12.31
Assets:
Accounts receivable -- 136,824,254.72
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Beijing Shougang Co. Ltd Annual Report 2022
The pelletizing -sintering business of Shougang Mining Corporation
Item
2022.11.30 2021.12.31
Other receivable 21,283,644.68 --
Inventories 386,071,523.33 524,883,808.40
Fixed assets 1,545,167,347.75 1,594,344,450.58
Construction in progress 211,170,008.86 49,784,077.48
Intangible assets 63,235,836.57 61,973,257.95
Total assets 2,226,928,361.19 2,367,809,849.13
Liabilities:
Accounts payable 981,170,128.23 382,223,910.42
Payroll and employee benefits 15,580,986.38 13,247,733.64
Other payables -- 765,924,603.17
Long-term payables 88,770,000.00 86,290,000.00
Total liabilities 1,085,521,114.61 1,247,686,247.23
Total equity 1,141,407,246.58 1,120,123,601.90
Net assets acquired on consolidation 1,141,407,246.58 1,120,123,601.90
Acquisition costs (cash paid to Shougang Mining Corp.) 1,300,325,799.36
Difference (recognised in equity) -158,918,552.78
VII. Interests in other entities
1. Interests in subsidiaries
(1) Composition of the Company
Shareholding ratio (%)
Main Operation
Subsidiary Registration place Business nature Acquisition method
place
Directly Indirectly
Business
Shougang Jingtang United Iron
Tangshan, PRC Tangshan, PRC Production and sales 70.18 29.82 combination under
& Steel Co., Ltd.
common control
Beijing Shougang Cold Establish or
Beijing, PRC Beijing, PRC Production and sales 70.28 --
Rolling Co., Ltd. investment, etc.
Qian'an Shougang Business
Metallurgical Technology Co., Qian’an, PRC Qian’an, PRC Consulting service 100.00 -- combination under
Ltd. common control
Shougang Zhixin Qian'an
Establish or
Electromagnetic Materials Co., Qian’an, PRC Qian’an, PRC Production and sales 75.40 8.90
investment, etc.
Ltd.
Beijing Shougang New Energy
Establish or
Automobile Material Qian’an, PRC Qian’an, PRC Production and sales 45.92 --
investment, etc.
Technology Co., Ltd.
Beijing Shougang Steel Business
Trading Investment Beijing, PRC Beijing, PRC Production and sales 100.00 -- combination under
Management Co., Ltd. common control
(2) Significant non-wholly owned subsidiaries
174
Beijing Shougang Co. Ltd Annual Report 2022
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
29.72 64,341,511.41 -- -317,199,002.85
Rolling Co., Ltd.
Shougang Zhixin Qian'an
Electromagnetic Materials 15.70 180,688,410.18 45,895,343.51 1,914,326,127.88
Co., Ltd.
(3) Major financial information of significant non-wholly owned subsidiaries
Unit：RMB
2022.12.31
Subsidiary
Non-current
Current assets Non-current assets Total assets Current liabilities Total liabilities
liabilities
Beijing
Shougang Cold 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
Rolling Co., Ltd.
Shougang Zhixin
Qian'an
Electromagnetic 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
Materials Co.,
Ltd.
Continued (1):
2021.12.31
Subsidiary
Non-current
Current assets Non-current assets Total assets Current liabilities Total liabilities
liabilities
Beijing Shougang
Cold Rolling Co., 2,292,638,370.58 3,982,540,841.55 6,275,179,212.13 2,987,915,522.96 4,574,607,301.55 7,562,522,824.51
Ltd.
Shougang Zhixin
Qian'an
4,815,349,946.90 13,874,497,322.96 18,689,847,269.86 7,183,851,434.42 1,118,800,705.05 8,302,652,139.47
Electromagnetic
Materials Co., Ltd.
Continued (2):
2022 2021
Subsidiary 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., 10,781,367,755.25 216,492,299.49 216,492,299.49 92,949,448.40 12,553,753,097.50 164,435,553.57 164,435,553.57 1,166,412,291.28
Ltd.
Shougang Zhixin
Qian'an
Electromagnetic 13,918,944,889.64 1,080,892,444.41 1,080,892,444.41 1,658,031,259.27 13,857,367,585.59 1,082,906,520.97 1,082,906,520.97 2,337,657,467.37
Materials Co.,
Ltd.
2. 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
175
Beijing Shougang Co. Ltd Annual Report 2022
Shareholding
Joint ventures Main operating proportion (%) Accounting
Place of registration Business nature
or associates place method
Direct Indirect
Tangshan Zhonghong Carbon Chemical Co.,
Tangshan, PRC Tangshan, PRC Chemical 50.00 Equity method
Ltd.
Tangshan Shougang Jingtang Xishan Coking
Tangshan, PRC Tangshan, PRC Coking 50.00 Equity method
Co., Ltd.
②Associates
Tangshan Tangcao Railway Co., Ltd. Tangshan, PRC Tangshan, PRC Transportation 16.19 Equity method
Tangshan Caofeidian Dunshi New Building
Tangshan, PRC Tangshan, PRC 25.00 Equity method
Construction Material Co., Ltd. Material
Qian'an Sinochem Coal Chemical Industrial
Qian’an, PRC Qian’an, PRC Coking 49.82 Equity method
Co., Ltd.
Beijing Shouxin Jinyuan Management
Beijing, PRC Beijing, PRC Investment 20.00 Equity method
Consulting Center (Limited Partnership)
Beijing Dingshengcheng Packaging Materials
Beijing, PRC Beijing, PRC Manufacturing 45.00 Equity method
Co., Ltd.
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
Tianjin, PRC Tianjin, PRC Manufacturing 35.00 Equity method
Processing&Distribution Co., Ltd.
Hebei Jingji Industry & Trading Co., Ltd. Shijiazhuang, PRC Shijiazhuang, PRC Manufacturing 35.71 Equity method
Qian'an Jinyu Shougang Environmental Building
Tianjin, PRC Tianjin, PRC 35.00 Equity method
Protection Technology Co., Ltd. Material
(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
2022.12.31 2021.12.31 2022.12.31 2021.12.31 2022.12.31 2021.12.31
Current assets 81,326,897.38 68,956,595.25 4,453,756.17 1,866,851.04 2,203,316,115.22 3,190,992,791.00
Including： Cash and cash
15,459,879.44 4,077,794.50 4,153,756.17 1,564,673.04 909,643,194.30 1,254,139,718.41
equivalents
Non-current assets 76,981,144.98 75,006,601.75 595,492,113.45 590,178,060.36 1,384,560,026.25 1,522,676,202.64
Total assets 158,308,042.36 143,963,197.00 599,945,869.62 592,044,911.40 3,587,876,141.47 4,713,668,993.64
Current liabilities 75,404,455.29 66,004,351.88 580,665,263.21 548,972,452.52 1,384,913,879.38 2,480,101,537.56
Non-current liabilities 6,537,093.21 5,383,693.40 -- -- 6,675,000.00 7,231,250.00
Total liabilities 81,941,548.50 71,388,045.28 580,665,263.21 548,972,452.52 1,391,588,879.38 2,487,332,787.56
Net assets 76,366,493.86 72,575,151.72 19,280,606.41 43,072,458.88 2,196,287,262.09 2,226,336,206.08
Including: Non-controlling
-- -- -- -- -- --
interests
Equity attributable to
shareholders of the 76,366,493.86 72,575,151.72 19,280,606.41 43,072,458.88 2,196,287,262.09 2,226,336,206.08
company
Net assets calculated by
38,183,246.94 36,287,575.86 9,640,303.21 21,536,229.44 1,098,143,631.04 1,113,168,103.04
shareholding proportion
Adjustment
176
Beijing Shougang Co. Ltd Annual Report 2022
Tangshan Zhonghong Carbon Chemical Tangshan Shougang Jingtang Xishan
Tangshan Guoxing Industrial Co., Ltd.
Co., Ltd. Coking Co., Ltd.
Item
2022.12.31 2021.12.31 2022.12.31 2021.12.31 2022.12.31 2021.12.31
Including: Goodwill -- -- -- -- -- --
Unrealized profit or loss of
-- -- -- -- -- --
internal transaction
Impairment -- -- -- -- -- --
Others -- -- -- -- -- --
Carrying value of equity
investment in the joint 38,183,246.94 36,287,575.86 9,640,303.21 21,536,229.44 1,098,143,631.04 1,113,168,103.04
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
2022 2021 2022 2021 2022 2021
Operating revenue 164,773,046.58 72,575,151.72 -- -- 13,921,855,400.28 10,931,089,729.11
Financial expenses 188,156.32 277,191.32 23,772,275.17 22,071,333.99 32,965,577.94 59,540,904.10
Income tax expense 3,565,111.77 4,668,092.98 -- -- -5,515,983.23 23,671,445.98
Net profit 7,790,570.91 10,753,141.86 -23,791,852.47 -174,429,403.75 56,141,503.88 56,774,860.49
Net profit from
discontinuing -- -- -- -- -- --
operations
Other comprehensive
-- -- -- -- -- --
income
Total comprehensive
7,790,570.91 10,753,141.86 -23,791,852.47 -174,429,403.75 56,141,503.88 56,774,860.49
income
Dividends received
2,000,000.00 2,000,000.00 -- -- 46,000,000.00 --
from joint venture
(3) Primary financial information of significant associates
Tangshan Caofeidian Dunshi New Qian'an Sinochem Coal Chemical
Tangshan Tangcao Railway Co., Ltd.
Construction Material Co., Ltd. Industrial Co., Ltd.
Item
2022.12.31 2021.12.31 2022.12.31 2021.12.31 2022.12.31 2021.12.31
Current assets 37,615,636.69 200,714,996.01 77,330,625.86 126,804,287.51 2,071,780,230.13 1,965,253,903.76
Non-current assets 8,175,281,488.59 8,400,213,950.72 224,215,514.07 235,304,874.32 2,457,397,455.41 2,255,751,305.36
Total assets 8,212,897,125.28 8,600,928,946.73 301,546,139.93 362,109,161.83 4,529,177,685.54 4,221,005,209.12
Current liabilities 1,026,481,331.40 1,189,477,610.98 31,678,142.16 45,941,594.92 2,727,774,901.17 2,014,924,895.69
Non-current liabilities 5,254,694,650.00 5,049,431,650.00 -- -- 20,417,377.09 10,482,966.04
Total liabilities 6,281,175,981.40 6,238,909,260.98 31,678,142.16 45,941,594.92 2,748,192,278.26 2,025,407,861.73
Net assets 1,931,721,143.88 2,362,019,685.75 269,867,997.77 316,167,566.91 1,780,985,407.28 2,195,597,347.39
Including:
Non-controlling -- -- -- -- -- --
interests
Equity attributable to
shareholders of the 1,931,721,143.88 2,362,019,685.75 269,867,997.77 316,167,566.91 1,780,985,407.28 2,195,597,347.39
company
177
Beijing Shougang Co. Ltd Annual Report 2022
Tangshan Caofeidian Dunshi New Qian'an Sinochem Coal Chemical
Tangshan Tangcao Railway Co., Ltd.
Construction Material Co., Ltd. Industrial Co., Ltd.
Item
2022.12.31 2021.12.31 2022.12.31 2021.12.31 2022.12.31 2021.12.31
Net assets calculated
by shareholding 312,745,653.19 382,410,987.12 67,466,999.44 79,041,891.73 887,363,090.11 1,093,937,932.70
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 312,745,653.19 382,410,987.12 67,466,999.44 79,041,891.73 891,510,510.32 1,098,085,352.91
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
2022.12.31 2021.12.31 2022.12.31 2021.12.31 2022.12.31 2021.12.31
Current assets 63,963,941.09 204,542,687.73 59,655,006.56 46,604,298.17 32,667,291.24 65,438,102.92
Non-current assets 694,420,798.63 492,971,452.05 618,495.73 560,866.81 214,254,258.49 34,618,324.64
Total assets 758,384,739.72 697,514,139.78 60,273,502.29 47,165,164.98 246,921,549.73 100,056,427.56
Current liabilities 152,354,244.94 139,570,827.95 22,971,249.27 16,181,730.58 56,004,281.62 2,916,673.38
Non-current liabilities -- -- -- -- 88,818,500.00 --
Total liabilities 152,354,244.94 139,570,827.95 22,971,249.27 16,181,730.58 144,822,781.62 2,916,673.38
Net assets 606,030,494.78 557,943,311.83 37,302,253.02 30,983,434.40 102,098,768.11 97,139,754.18
Including:
Non-controlling -- -- -- -- -- --
interests
Equity attributable to
shareholders of the 606,030,494.78 557,943,311.83 37,302,253.02 30,983,434.40 102,098,768.11 97,139,754.18
company
Net assets calculated
by shareholding 122,430,402.99 112,715,820.57 16,786,013.86 13,942,545.49 35,734,568.85 33,998,913.97
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 122,430,402.99 112,715,820.57 16,830,558.74 13,987,090.36 35,734,568.85 33,998,913.97
the associates
Fair value of equity -- -- -- -- -- --
investment with
178
Beijing Shougang Co. Ltd Annual Report 2022
Beijing Shouxin Jinyuan Management Beijing Dingshengcheng Packaging Qian'an Jinyu Shougang Environmental
Consulting Center (Limited Partnership) Materials Co., Ltd. Protection Technology Co., Ltd.
Item
2022.12.31 2021.12.31 2022.12.31 2021.12.31 2022.12.31 2021.12.31
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
2022 2021 2022 2021 2022 2021
Operating revenue 93,455,166.47 104,729,545.83 440,890,510.08 578,541,511.89 8,253,813,834.07 6,295,880,462.27
Net profit -431,009,356.99 -418,134,678.91 3,700,430.86 32,185,557.39 -414,611,940.11 292,507,527.36
Net profit from
discontinuing -- -- -- -- -- --
operations
Other comprehensive
-- -- -- -- -- --
income
Total comprehensive
-431,009,356.99 -418,134,678.91 3,700,430.86 32,185,557.39 -414,611,940.11 292,507,527.36
income
Dividend received
-- -- 12,500,000.00 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
2022 2021 2022 2021 2022 2021
Operating income 167,658,027.20 334,174,126.04 147,636,999.45 128,110,940.82 34,551,131.55 16,867,497.02
Net profit 123,487,685.42 258,828,753.79 6,318,818.62 5,792,411.77 1,507,371.77 591,396.34
Net profit from
-- -- -- -- -- --
discontinuing operation
Other comprehensive
-- -- -- -- -- --
income
Total comprehensive
123,487,685.42 258,828,753.79 6,318,818.62 5,792,411.77 1,507,371.77 591,396.34
income
Dividend received from
15,232,424.74 173,716,946.85 -- -- -- --
associates
(4) Summary financial information of no significant joint ventures and associates
Item 2022.12.31 or Current period 2021.12.31 or Pervious period
Associates
Total carrying value of investment 131,600,050.63 174,696,933.28
Items calculated according to shareholding ratio
Net profit -473,871.48 3,061,477.93
Other comprehensive income
Total comprehensive income -473,871.48 3,061,477.93
3. Interests in unconsolidated structured entities
(1) Basic information of unconsolidated structured entities
179
Beijing Shougang Co. Ltd Annual Report 2022
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 2022, 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 at 31 December 2022, 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
Fund.
(2) Carrying value and maximum loss exposure of interests related assets and liabilities
As at 31 December 2022, 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 105.8864 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 at 31 December 2022, 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
180
Beijing Shougang Co. Ltd Annual Report 2022
As at 31 December 2022, no additional information related to Shouxin Jinyuan Fund and Shouxin
Jin'an Fund should be disclosed by the Company.
VIII. 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
181
Beijing Shougang Co. Ltd Annual Report 2022
accounted for 52.28% (2021: 45.99%); among the other receivables of the Company, the other
receivables of the top five customers accounted for 63.31% (2021: 59.06%)
(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 2022, the leverage ratio of the Company is 65.03% (31 December
2021: 67.21%).
IX. 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 2022, 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
I. Recurring fair value measurement
(1) Financing receivable -- -- 3,489,134,871.56 3,489,134,871.56
(2) Other equity instrument investment 197,880,464.00 -- 34,885,669.81 232,766,133.81
(3) Other non-current financial assets -- -- 79,234,007.60 79,234,007.60
182
Beijing Shougang Co. Ltd Annual Report 2022
Total assets measured at fair value
197,880,464.00 -- 3,603,254,548.97 3,801,135,012.97
on a recurring basis
(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.
X. 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 56.53 56.53
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):
As at 31 December 2021 Increase Decrease As at 31 December 2022
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, 2.
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 Zhonghong Carbon Chemical 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
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Name of joint venture or associate Relationship with the Company
Guangzhou Jinghai Shipping Co., Ltd. Associates of the Company
Tianjin Shougang Steel Processing&Distribution Co., Ltd. Associates of 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 Shougang Xinganglian Technology&Trade 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
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Beijing Shougang Co. Ltd Annual Report 2022
Related party Relationship with the 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
Qinhuangdao Shougang Krosaki Refractory 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
Qinhuangdao Zhongshou Logistics 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
Tangshan Shoukuang Cleaning Iron 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
185
Beijing Shougang Co. Ltd Annual Report 2022
Related party Relationship with the 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
Beijing Shouxinsheng Trading Co., Ltd. Under the control of the same parent company
Qinhuangdao Shougang Plate Mill Co., Ltd. Under the control of the same parent company
Beijing Shougang Fulushi Color Coated Plate 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
Ningbo Metallurgical Investigation, Design&Research Co., Ltd. Under the control of the same parent company
Tonggang Jilin Welded Pipe Co., Ltd Under the control of the same parent company
Beijing Shougang Mining Investment 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) 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
Mine Hospital of Shougang Group 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
186
Beijing Shougang Co. Ltd Annual Report 2022
Related party Relationship with the 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
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
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
Beijing Shoutaizhongxin Science & Technology Co., Ltd
parent company
Directors, Supervisors, CFO and Board Secretary Key management personnel
5. Information about related party transactions
187
Beijing Shougang Co. Ltd Annual Report 2022
(1) Details of related purchase and sales
①Purchase of goods and receiving of services from related parties
Nature of
Related party 2022 2021
transaction
Shougang Group Co., Ltd. Raw material 30,738,244,970.15 38,213,705,218.31
Shougang Group Co., Ltd. Fuel material 1,755,484,533.11 1,436,079,743.96
Engineering
Shougang Group Co., Ltd. -- 107,886,266.97
equipment
Shougang Group Co., Ltd. Spare parts 288,719.70 61,664,063.35
Shougang Group Co., Ltd. Production service 24,483,467.94 25,846,478.94
Shougang Group Co., Ltd. Fund usage charges 71,217,912.21 75,407,530.12
Shougang Group Finance Co., Ltd. Fund usage charges 308,397,762.40 292,800,216.58
Shougang Mining Corporation Raw material 3,801,893,028.27 4,609,820,903.85
Shougang Mining Corporation Spare parts 5,484,172.00 3,778,051.70
Shougang Mining Corporation Production service 113,846,405.24 130,707,744.54
Engineering
Shougang Mining Corporation 1,904,158.00 626,686.00
equipment
Shougang Mining Corporation Fund usage charges 2,210,553.86 --
China Shougang International
Export cost 82,530,156.00 71,055,095.49
Trade&Engineering Corporation
China Shougang International
Raw material 2,531,173,902.66 4,089,317,261.70
Trade&Engineering Corporation
China Shougang International
Fuel material 96,591,728.29 --
Trade&Engineering Corporation
Qian'an Sinochem Coal Chemical
Fuel material 7,005,052,052.73 5,465,442,208.53
Industrial Co., Ltd.
Qian'an Sinochem Coal Chemical
Power energy 393,033,410.87 362,255,517.37
Industrial Co., Ltd.
Beijing Shougang Refractory&
Production service 1,458,000.00 3,758,115.00
Metallurgical Burden Co., Ltd.
Beijing Shougang Refractory&
Engineering service 6,000,851.01 10,770,342.75
Metallurgical Burden Co., Ltd.
Beijing Shougang Construction Group
Production service 473,493,304.04 622,929,389.39
Co., Ltd.
Beijing Shougang Construction Group
Spare parts 26,646,250.93 16,630,652.40
Co., Ltd.
Beijing Shougang Construction Group Engineering
-- 61,946.00
Co., Ltd. equipment
Beijing Shougang Construction Group
Engineering service 704,479,068.44 930,940,085.69
Co., Ltd.
Beijing Shougang Gas Co., Ltd. Spare parts 3,642,954.04 1,635,395.19
Beijing Shougang Gas Co., Ltd. Production service 51,120,800.84 57,272,804.78
Beijing Shougang Gas Co., Ltd. Power energy 94,449,984.15 109,544,662.97
Beijing Shougang Gas Co., Ltd. Auxiliary material 4,742,161.45 9,208,242.96
188
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Beijing Shougang Automation
Production service 314,726,062.22 345,978,795.76
Information Technology Co., Ltd.
Beijing Shougang Automation
Spare parts 6,119,863.00 7,529,718.33
Information Technology Co., Ltd.
Beijing Shougang Automation
Engineering service 164,940,165.69 115,338,195.80
Information Technology Co., Ltd.
Beijing Shougang Automation Engineering
56,830,246.32 76,320,731.33
Information Technology Co., Ltd. equipment
Beijing Shougang Machinery&Electric
Spare parts 108,341,720.51 113,462,788.79
Co., Ltd.
Beijing Shougang Machinery&Electric
Production service 291,903,126.80 271,132,744.28
Co., Ltd.
Beijing Shougang Machinery&Electric Engineering
33,623,091.14 26,536,094.40
Co., Ltd. equipment
Beijing Shougang Machinery&Electric
Engineering service 2,106,619.54 8,184,437.70
Co., Ltd.
Qinhuangdao Shougang Machinery Co.,
Spare parts 49,708,124.60 53,445,297.00
Ltd.
Qinhuangdao Shougang Machinery Co.,
Production service 164,741,681.95 161,443,825.72
Ltd.
Qinhuangdao Shougang Machinery Co.,
Auxiliary material 534,000.00 181,612.00
Ltd.
Qinhuangdao Shougang Machinery Co., Engineering
2,849,600.00 631,639.35
Ltd. equipment
Qian'an Shouxin Automation
Production service 123,198,193.34 119,293,169.06
Information Technology Co., Ltd.
Qian'an First Real Packaging Service
Production service 330,518,074.43 354,866,870.91
Co., Ltd.
Qian'an First Real Packaging Service
Raw material -- 288,102.67
Co., Ltd.
Qian'an Shougang Equipment Structure
Spare parts 16,770,235.00 20,007,338.00
Co., Ltd.
Qian'an Shougang Equipment Structure
Production service 74,615,037.69 109,479,534.70
Co., Ltd.
Qian'an Shougang Equipment Structure Engineering
6,099,531.07 1,604,206.84
Co., Ltd. equipment
Qian'an Shougang Equipment Structure
Engineering service 688,292.46 825,909.00
Co., Ltd.
Qian'an Shougang Equipment Structure
Raw material 216,797,429.95 519,943,875.16
Co., Ltd.
Huludao Shougang Donghua Machinery
Spare parts -- 1,271,577.00
Co., Ltd.
Huludao Shougang Donghua Machinery
Production service -- 5,814,300.00
Co., Ltd.
Engineering
Beijing Soly Technology Co., Ltd. 612,341.00 830,868.00
equipment
Beijing Shouye Instruments&Meters
Spare parts 30,692,578.79 37,559,656.13
Co., Ltd.
Beijing Shouye Instruments&Meters Engineering
4,608,458.59 5,208,510.00
Co., Ltd. equipment
Beijing Shoujian Equipment
Production service 45,870,911.70 90,841,047.04
Maintenance Co., Ltd.
Beijing Shoujian Equipment
Auxiliary material 5,154,000.00 5,659,200.00
Maintenance Co., Ltd.
189
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Beijing Shoujian Equipment
Engineering service 5,962,127.57 1,128,873.68
Maintenance Co., Ltd.
Beijing Shoujian Equipment Engineering
9,790,200.00 355,200.76
Maintenance Co., Ltd. equipment
Beijing Shoujian Hengxin Labor Service
Production service 1,785,000.00 1,925,000.00
Co., Ltd.
Beijing Shoujian Hengji Construction
Spare parts 573,207.00 939,736.80
Engineering Co., Ltd.
Beijing Shougang Landscaping Co., Ltd. Life service 25,701,356.25 26,567,532.41
Beijing Shougang Landscaping Co., Ltd. Engineering service -- 733,072.00
Beijing Shougang International
Spare parts 13,777,316.00 12,607,597.00
Engineering&Technology Co., Ltd.
Beijing Shougang International Engineering
197,970,778.68 72,137,555.51
Engineering&Technology Co., Ltd. equipment
Beijing Shougang International
Engineering service 475,003,098.49 537,616,321.63
Engineering&Technology Co., Ltd.
Beijing Shougang International
Production service 664,296.23 17,945,708.90
Engineering&Technology Co., Ltd.
Beijing Jinanyuan Automobile
Production service 67,493,491.20 76,299,884.11
Transportation Co., Ltd.
Beijing Shougang Xinganglian
Production service -- 10,852,343.50
Technology&Trade Co., Ltd.
Beijing Huaxia Technology Co., Ltd. Spare parts 3,781,380.33 5,512,346.85
Engineering
Beijing Huaxia Technology Co., Ltd. -- 57,216.00
equipment
Beijing Huaxia Technology Co., Ltd. Production service 86,000.00 1,239,998.00
Beijing Shougang Catering Co., Ltd. Life service 14,014,372.50 32,281,673.78
Beijing Shoujia Steel Construction Co.,
Production service 44,258,026.72 43,447,842.27
Ltd.
Beijing Shougang Ferroalloy Co., Ltd. Raw material 436,896,664.79 448,631,993.28
Lujiashan Limestone Mining of
Raw material 350,495,042.52 254,273,652.15
Shougang Beijing Co., Ltd.
Lujiashan Limestone Mining of
Production service 53,344,775.21 59,356,273.21
Shougang Beijing Co., Ltd.
Lujiashan Limestone Mining of
Auxiliary material 8,312,204.20 8,208,732.96
Shougang Beijing Co., Ltd.
Qinhuangdao Shougang Krosaki
Auxiliary material 128,141,883.61 108,337,207.14
Refractory Co., Ltd.
Qinhuangdao Shougang Krosaki Engineering
-- 2,287,610.62
Refractory Co., Ltd. equipment
Yantai Shougang Mining 3D Co., Ltd. Spare parts 577,091.09 1,172,351.11
Tianjin Shougang Electric Equipment Engineering
19,847,769.10 14,876,285.81
Co., Ltd. equipment
Tianjin Shougang Electric Equipment
Spare parts 4,465,189.00 10,249,090.00
Co., Ltd.
Beijing Chengxin Engineering
Engineering service 7,529,528.15 5,839,707.47
Supervision Co., Ltd.
Beijing Chengxin Engineering
Production service 3,717,879.25 1,044,069.80
Supervision Co., Ltd.
190
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Beijing Shoucheng Packaging Service
Production service 107,663,074.01 121,321,417.29
Co., Ltd.
Beijing Shougang Materials Trading
Fuel material 269,025,918.47 309,682,912.34
Co., Ltd.
Beijing Shougang Materials Trading
Raw material 996,216,356.30 927,016,812.76
Co., Ltd.
Tangshan Shougang Jingtang Xishan
Power energy 1,063,798,684.12 961,379,395.21
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Fuel material 17,586,534,301.71 13,163,464,122.66
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Raw material 3,610,282.21 3,021,523.41
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Production service 152,523,150.26 248,887,913.91
Coking Co., Ltd.
Beijing Shougang Futong Elevator Co.,
Spare parts 177,460.00 91,115.00
Ltd.
Beijing Shougang Futong Elevator Co.,
Production service 884,800.00 869,600.00
Ltd.
Tangshan Guoxing Industrial Co., Ltd. Production service 145,637,666.86 117,579,964.30
Tangshan Guoxing Industrial Co., Ltd. Engineering service 2,236,643.61 4,552,565.46
Tangshan Caofeidian Industrial District
Production service 386,060,741.11 457,270,718.97
Shouhanxin Industrial Co., Ltd.
Engineering
Tonghua Iron and Steel Co., Ltd. -- 3,236,416.51
equipment
Tonghua Iron and Steel Co., Ltd. Raw material 358,614,209.66 66,026,550.32
Beijing Shougang Huaxia
Production service -- 94,339.62
Engineering&Technology Co., Ltd.
Beijing Shougang Huaxia Engineering
-- 1,362,800.00
Engineering&Technology Co., Ltd. equipment
Shougang Environmental Industry Co.,
Production service 4,790,641.42 4,282,264.11
Ltd.
Qinhuangdao Zhongshou Logistics Co.,
Production service -- 587,690.19
Ltd.
Beijing Shougang Mining Construction
Engineering service 32,202,238.47 61,119,047.72
Co., Ltd.
Beijing Shougang Mining Construction
Production service 3,124,511.85 8,300,086.81
Co., Ltd.
Qinhuangdao Shouqin Metal Materials Engineering
2,640,623.65 1,618,385.43
Co., Ltd. equipment
Qinhuangdao Shouqin Metal Materials
Raw material -- 1,268,839.82
Co., Ltd.
Beijing Shougang Industrial Group Co.,
Life service 5,463,312.46 8,354,159.55
Ltd.
Beijing Shougang Shape Metal Co., Ltd. Raw material 1,157,199.12 1,114,889.38
Beijing Dingshengcheng Packaging
Production service 132,716,435.98 117,572,234.28
Materials Co., Ltd.
Beijing Dingshengcheng Packaging
Auxiliary material 2,588,730.00 2,330,402.40
Materials Co., Ltd.
Beijing Shougang Cultural Development
Production service 580,274.11 149,009.43
Co., Ltd.
Jingxi Commercial Factoring Co., Ltd. Raw material 2,294,124.34 --
191
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Qinhuangdao Shouqin Steel
Spare parts 202,712.00 261,453.00
Machining&Delivery Co., Ltd.
Shougang Casey Steel Co., Ltd. Production service 99,663,335.28 102,954,696.79
Tangshan Caofeidian First Real
Life service 103,510,367.58 23,414,022.52
Industrial Co., Ltd.
Tangshan Caofeidian First Real
Spare parts 2,092,860.00 --
Industrial Co., Ltd.
Qiangang Hotel. Production service 20,138,607.00 25,876,769.55
Beijing Shougang Special Steel Co.,
Production service -- 426,234.71
Ltd.
Beijing Shougang Special Steel Co.,
Power energy -- 20,612.25
Ltd.
Beijing Shougang Yunxiang Industrial
Spare parts 8,985,583.27 478,270.00
Technology Co., Ltd.
Bohai International Conference Center
Life service 872,777.64 103,046.23
Co., Ltd.
Hebei Shoulang New Energy
Power energy 5,228,810.04 2,721,359.52
Technology Co., Ltd.
Qian'an Shougang Xingkuang Industrial
Auxiliary material 46,730,677.66 47,844,677.06
Co., Ltd.
Beijing Thermal Zhongda Heat
Spare parts 21,599,664.94 19,576,171.83
Exchange Equipment Co., Ltd.
Beijing Thermal Zhongda Heat
Production service 11,997,608.00 13,757,098.00
Exchange Equipment Co., Ltd.
Guangzhou Jinghai Shipping Co., Ltd. Production service 355,036,509.27 407,924,922.93
PetroChina Shougang (Beijing)
Spare parts 61,667,449.21 51,088,635.32
Petroleumsales Co., Ltd.
PetroChina Shougang (Beijing)
Production service 810,772.36 802,443.04
Petroleumsales Co., Ltd.
Beijing Shoushe Metallurgical Engineering
255,912.13 690,603.97
Technology Co., Ltd. equipment
Beijing Shouyu Industry and Trade Co.,
Auxiliary material 11,422,545.27 10,603,136.18
Ltd.
Chaoyang Shougang Beifang Machinery
Spare parts 9,600.00 15,262.00
Co., Ltd.
Shougang Guiyang Special Steel Co.,
Auxiliary material -- 13,263,605.26
Ltd.
Tangshan Caofeidian Ganglian Logistics
Production service 179,731,432.37 187,299,390.37
Co., Ltd.
Tangshan Caofeidian Industry Port Co.,
Production service 476,275,284.06 442,226,204.61
Ltd.
Tianjin Shougang Steel
Production service 3,093,058.92 3,771,028.94
Processing&Distribution Co., Ltd.
Tianjin Shougang Steel
Raw material 137,219.49 2,598,673.80
Processing&Distribution Co., Ltd.
Beijing Shoutaizhongxin Science &
Spare parts 20,983,879.94 1,556,522.23
Technology Co., Ltd
Chengde Xintong Shoucheng Mining
Raw material 180,923,753.72 287,802,331.88
Co., Ltd.
Shougang (Qingdao) Steel Industry Co.,
Raw material 908,220.09 28,003,765.33
Ltd.
192
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Beijing Shougang Park Comprehensive
Life service 1,477,352.85 1,458,695.68
Service Co., Ltd.
YASKAWA Shougang Robert Co., Ltd. Production service 141,500.00 99,190.00
Beijing Shouxinsheng Trading Co., Ltd. Raw material -- 660,000.00
Qinhuangdao Shougang Racing Valley
Production service 431,358.48 593,547.16
Co., Ltd
Hebei Shougang Jingtang Machinery
Production service 37,269,512.82 8,612,479.50
Co., Ltd.
Beijing Shouao Real Estate Co., Ltd Life service 23,794.00 65,373.00
Engineering
Cmi Engineering (Beijing) Co., Ltd. 12,892,700.00 2,350,492.00
equipment
Ningbo Shougang Zhejin Steel Co., Ltd. Production service -- 137,342.41
South China International Leasing Co.,
Fund usage charges 751,226.41 408,154.27
Ltd
Beijing Shouxin Jinyuan Management
Fund usage charges 21,900,000.00 14,223,287.67
Consulting Center (Limited Partnership)
Shougang Changzhi Steel&Iron Co.,
Fuel material -- 6,491,155.75
Ltd.
Shougang Changzhi Steel&Iron Co.,
Raw material 1,509,854.85 --
Ltd.
Qinhuangdao Shoufang Property
Life service 861,700.00 903,720.00
Service Co., Ltd.
Bejing Shougang International Travel
Life service -- 186,162.47
Co., Ltd.
Beijing Shougang Environmental
Raw material -- 10,514,058.58
Engineering Technology Co., Ltd.
Qian'an Jinyu Shougang Environmental
Production service 23,335,032.81 5,440,692.45
Protection Technology Co., Ltd.
Beijing Shougang Property Management
Production service 2,935,902.84 2,903,326.07
Co., Ltd.
Guiyang Steel Mills I/E Corp. Production service 13,153,495.39 3,371,370.88
Gansu Province, Wenxian Million Litie
Raw material 936,100,776.46 812,062,129.47
Alloy Co., Ltd.
Tangshan Caofeidian Dunshi New
Production service 1,858,061.44 1,554,416.90
Construction Material Co., Ltd.
Beijing Shouyi Mining Hospital Co.,
Production service 3,486,466.50 1,953,842.62
Ltd.
Peking University Shougang Hospital Production service 122,228.18 631,300.18
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 407,104,956.47 395,735,341.91
Ore Co., Ltd.
Jingtang Port Shougang Terminal Co.,
Production service 6,091,794.34 1,296,226.42
Ltd.
②Sale of goods and rendering of services to related parties
193
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Management
Shougang Group Co., Ltd. 233,378,200.00 322,856,073.40
service
Shougang Group Co., Ltd. Production service 16,202,255.66 16,384,180.19
Shougang Mining Corporation Steel 2,076,407.04 9,657,678.23
Shougang Mining Corporation Raw fuel material 11,262,064.60 17,317,593.28
Shougang Mining Corporation Power energy 127,160.60 93,318.05
Shougang Mining Corporation Production service 15,600,062.87 16,106,593.88
Shougang Group Finance Co., Ltd. Interest income 130,624,439.00 129,218,534.77
Qian'an Sinochem Coal Chemical
Power energy 247,263,882.72 277,517,105.35
Industrial Co., Ltd.
Shougang Casey Steel Co., Ltd. Steel 535,645,904.62 872,744,622.51
Shougang Casey Steel Co., Ltd. Production service 1,136,801.76 1,821,488.40
Beijing Shougang Xinganglian
Steel -- 52,568.33
Technology&Trade Co., Ltd.
Beijing Shougang Construction Group
Power energy 3,264,125.51 2,519,371.08
Co., Ltd.
Beijing Shougang Construction Group
Steel 9,098,035.59 37,736,546.55
Co., Ltd.
Beijing Shougang Construction Group
Production service 1,985,086.15 977,440.97
Co., Ltd.
Beijing Shougang Gas Co., Ltd. Power energy 110,053,446.78 151,854,252.56
Beijing Shougang Machinery&Electric
Steel 613,930,630.06 147,153,949.07
Co., Ltd.
Beijing Shougang Machinery&Electric
Power energy 3,913,938.59 3,337,782.11
Co., Ltd.
Beijing Shougang Machinery&Electric
Production service 1,604,228.13 1,513,633.98
Co., Ltd.
Beijing Shougang Machinery&Electric
Spare parts -- 180,310.18
Co., Ltd.
Beijing Shougang Ferroalloy Co., Ltd. Power energy 3,676,369.55 2,829,746.71
Beijing Shougang Ferroalloy Co., Ltd. Raw fuel material 21,241,039.12 20,619,652.70
Beijing Shougang Ferroalloy Co., Ltd. Production service 473,569.14 484,625.75
Tangshan Shougang Jingtang Xishan
Power energy 707,298,397.35 600,722,568.59
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Production service 221,751,315.34 214,700,900.89
Coking Co., Ltd.
Tangshan Shougang Jingtang Xishan
Raw material 1,041,626.43 --
Coking Co., Ltd.
Beijing Beiye Functional Materials Co.,
Billet 8,300,691.98 14,900,608.66
Ltd.
Beijing Shougang Huaxia
Raw fuel material 6,901,691.83 56,998,443.29
Engineering&Technology Co., Ltd.
Beijing Shougang Huaxia
Production service 118,539.00 118,539.00
Engineering&Technology Co., Ltd.
Beijing Shoucheng Packaging Service
Steel 3,649,548.62 36,292,975.72
Co., Ltd.
194
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Beijing Shoucheng Packaging Service
Power energy 359,523.37 296,380.80
Co., Ltd.
Beijing Shoucheng Packaging Service
Production service 1,872,706.78 1,868,192.00
Co., Ltd.
Qian'an First Real Packaging Service
Steel 102,754,677.80 39,934,460.63
Co., Ltd.
Beijing Shouronghui Technology
Steel 41,264,142.20 1,966,033.60
Development Co., Ltd.
Tangshan Caofeidian Dunshi New
Raw fuel material 167,597,204.04 281,348,426.05
Construction Material Co., Ltd.
Tangshan Caofeidian Dunshi New
Power energy 139,527,704.49 120,645,752.67
Construction Material Co., Ltd.
Tangshan Caofeidian Dunshi New
Production service 28,288,337.62 27,043,499.52
Construction Material Co., Ltd.
Beijing Shougang International
Steel -- 622,011.63
Engineering&Technology Co., Ltd.
Beijing Shougang International
Power energy -- 34,249.96
Engineering&Technology Co., Ltd.
Beijing Shougang International
Production service 1,342,075.48 452,830.19
Engineering&Technology Co., Ltd.
Beijing Shougang Metal Co., Ltd. Steel 40,394,334.29 42,108,282.48
Beijing Shougang Metal Co., Ltd. Power energy 1,445,681.43 1,453,606.94
Beijing Shougang Metal Co., Ltd. Production service 2,754,311.93 2,756,334.23
Beijing Shougang Mining Construction
Steel 9,394.34 1,241,277.67
Co., Ltd.
Tangshan Caofeidian Industrial District
Steel -- 41,892,931.70
Shouhanxin Industrial Co., Ltd.
Qinhuangdao Shougang Machinery Co.,
Raw fuel material 579,784,184.94 937,014,959.13
Ltd.
Qinhuangdao Shougang Machinery Co.,
Power energy 541,746.35 508,092.44
Ltd.
Qinhuangdao Shougang Machinery Co.,
Production service 653,463.03 1,888,757.36
Ltd.
Qian'an Shougang Equipment Structure
Power energy -- 21,000.00
Co., Ltd.
Qian'an Shougang Equipment Structure
Production service 221,876.15 164,068.27
Co., Ltd.
Qian'an Shougang Equipment Structure
Steel 3,027,566.84 223,401.77
Co., Ltd.
Tangshan Guoxing Industrial Co., Ltd. Power energy 1,720,010.15 812,139.20
Tangshan Guoxing Industrial Co., Ltd. Raw fuel material 1,253,595.05 4,072,506.20
Tangshan Guoxing Industrial Co., Ltd. Production service 1,736,728.31 1,962,692.75
Tangshan Caofeidian Industrial Zone
Power energy 55,369.38 125,248.13
Jingtang Industrial Co., Ltd.
Tangshan Caofeidian First Real
Power energy 920,768.85 873,443.01
Industrial Co., Ltd.
Beijing Shougang Automation
Power energy 23,403.49 1,305,678.06
Information Technology Co., Ltd.
Beijing Shougang Automation
Production service 1,045,424.53 237,735.85
Information Technology Co., Ltd.
195
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
Hebei Shoulang New Energy
Power energy 123,024,177.15 93,846,906.81
Technology Co., Ltd.
Hebei Shoulang New Energy
Production service 2,142,857.14 1,714,285.71
Technology Co., Ltd.
Beijing Jinanyuan Automobile
Production service 1,188,957.33 198,165.14
Transportation Co., Ltd.
Tonghua Iron and Steel Co., Ltd. Raw fuel material 283,018.87 778,164.50
Lujiashan Limestone Mining of
Raw fuel material 2,764,398.78 12,677,501.44
Shougang Beijing Co., Ltd.
Beijing Shougang Materials Trading
Raw fuel material -- 10,752,760.18
Co., Ltd.
Beijing Shougang Materials Trading
Production service 54,194.35 --
Co., Ltd.
Beijing Shougang Materials Trading
Steel -- 31,365,842.84
Co., Ltd.
Qinhuangdao Shougang Krosaki
Raw fuel material -- 46,410.02
Refractory Co., Ltd.
Shougang Changzhi Steel&Iron Co.,
Production service 141,509.43 330,188.68
Ltd.
Tangshan Caofeidian Industry Port Co.,
Power energy 3,778,635.00 3,390,814.00
Ltd.
Tangshan Zhonghong Carbon Chemical
Interest income 11,275,389.73 10,518,170.49
Co., Ltd.
Tangshan Zhonghong Carbon Chemical
Production service -- 613,153.25
Co., Ltd.
Ningbo Shougang Zhejin Steel Co., Ltd. Steel 432,375,321.23 733,790,833.50
Shougang (Qingdao) Steel Industry Co.,
Steel 1,935,625,780.26 2,635,744,920.56
Ltd.
Shougang (Qingdao) Steel Industry Co.,
Production service 7,346,687.79 --
Ltd.
Tianjin Shougang Steel
Steel 27,569,222.18 12,410,581.55
Processing&Distribution Co., Ltd.
Ordos Baotou Steel Shourui Material
Steel -- 20,147,152.24
Technology Co., Ltd.
Qian'an Shoujia Construction Material
Power energy 22,884,203.10 26,424,700.75
Co., Ltd.
Qian'an Shoujia Construction Material
Raw fuel material 36,514,508.74 78,768,061.55
Co., Ltd.
Qian'an Shoujia Construction Material
Production service 248,418.37 270,782.37
Co., Ltd.
Beijing Dingshengcheng Packaging
Power energy 44,068.34 72,289.19
Materials Co., Ltd.
Guizhou Bohong Industrial Co., Ltd. Production service 129,836.50 88,038.87
Beijing Shougang Landscaping Co.,
Power energy 1,430.47 4,162.17
Ltd.
Dachang Shougang
Steel 1,547,925.87 2,382,335.68
Machinery&Electric Co., Ltd.
Guangzhou Jinghai Shipping Co., Ltd. Production service 50,495,018.05 46,548,850.68
PetroChina Shougang (Beijing)
Power energy 32,357.74 25,414.27
Petroleumsales Co., Ltd.
196
Beijing Shougang Co. Ltd Annual Report 2022
Nature of
Related party 2022 2021
transaction
PetroChina Shougang (Beijing)
Steel 65,202,291.10 125,306,810.27
Petroleumsales Co., Ltd.
Qian'an Shougang Xingkuang Industrial
Steel 35,007,815.91 50,832,468.42
Co., Ltd.
Beijing Shougang Gas Tangshan Co.,
Production service 235,714.29 565,714.29
Ltd.
Beijing Shougang Catering Co., Ltd. Power energy 524,090.49 706,148.05
Beijing Jingxi Supply Chain
Steel 64,207,092.86 --
Management Co., Ltd.
Guizhou Liupanshui Shenghongda
Mechanical Equipment Manufacturing Production service 65,725.38 22,871.70
Co., Ltd
Guizhou Shuigang Logistics Co., Ltd. Production service 157,558.15 9,040.57
Shougang Shuicheng Iron and Steel
(Group) Xingyuan Development Production service 26,335.85 81,484.90
Investment Co., Ltd.
Hebei Jingji Industry & Trading Co.,
Steel 8,578,020.68 13,707,273.61
Ltd.
Qian'an Jinyu Shougang Environmental
Raw fuel material 3,096,681.58 5,670,282.21
Protection Technology Co., Ltd.
Jingtang Port Shougang Terminal Co.,
Production service 327,224.25 286,751.34
Ltd.
Beijing Shouke Xingye Engineering
Production service -- 1,681,415.93
Technology Co., Ltd.
Tonggang Jilin Welded Pipe Co., Ltd Steel -- 17,830.09
Shoujia Huanke (Qian'an) Co., Ltd. Raw fuel material 26,345,440.31 23,094,037.69
Beijing Shoujian Equipment
Production service -- 19,018.87
Maintenance Co., Ltd.
Beijing Shoujia Steel Construction Co.,
Power energy 1,160,424.21 --
Ltd.
Beijing Thermal Zhongda Heat
Production service 8,962.26 --
Exchange Equipment Co., Ltd.
Beijing Shougang Lanzatech Co., Ltd. Production service 727,265.93 --
Tangshan Tangcao Railway Co., Ltd. Production service 3,323,611.75 --
(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 2022 2021
Qian'an Sinochem Coal Chemical
Land use right 1,065,067.58 824,536.83
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 165,333.33 165,333.33
② The Company as a lessee
197
Beijing Shougang Co. Ltd Annual Report 2022
Type of assets Lease expenses recognized in Lease expenses recognized in
Lessor
leased 2022 2021
Beijing Shougang Construction
Property 10,139,897.90 10,139,897.90
Investment Co., Ltd.
Shougang Group Co., Ltd. Property 2,856,131.74 3,198,777.88
Beijing Shougang Special Steel Co.,
Property -- 11,333.33
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
Beijing Shougang Construction
Plant and buildings -- 45,024,073.82
Investment Co., Ltd.
Interest expenses incurred on lease liabilities during the reporting period
Type of assets Interest expenses of the Interest expenses of the
Lessor
leased current period previous period
Shougang Group Co., Ltd. Plant and buildings 1,470,426.80 1,493,817.76
Beijing Shougang Construction
Plant and buildings 1,566,004.04 1,953,367.31
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
Shougang (Qingdao) Steel Industry
182,000,000.00 2022/9/20 2023/11/18 Incomplete
Co., Ltd.
Ningbo Shougang Zhejin Steel Co.,
24,000,000.00 2022/8/29 2023/8/28 Incomplete
Ltd.
② The Company as a guarantee
Status of
Guarantor Amount of guarantee Beginning date Maturity date
guarantee
Shougang Group Co., Ltd. 75,000,000.00 2022/9/6 2023/3/19 Incomplete
Shougang Group Co., Ltd. 6,907,003,333.35 2022/1/5 2023/10/24 Incomplete
Shougang Group Co., Ltd. 9,413,355,833.34 2019/9/6 2031/9/3 Incomplete
(4) Details of related party funding
Related party Closing balance Beginning date Maturity date Note
Shougang Group Co., Ltd. 195,126,863.30 2020/3/25 2025/9/6 Entrust loans
Shougang Group Finance Co., Ltd. 10,582,321,996.95 2022/1/28 2023/12/23 Short-term loans
Shougang Group Finance Co., Ltd. 500,435,416.67 2022/11/4 2025/11/4 Long-term loans
Shougang Group Finance Co., Ltd. 6,739,010,000.00 2022/7/5 2023/6/26 Notes payable
South China International Leasing Long-term
15,781,907.85 2020/1/7 2023/3/5
Co., Ltd payable
198
Beijing Shougang Co. Ltd Annual Report 2022
Related party Closing balance Beginning date Maturity date Note
Tangshan Zhonghong Carbon Other current
285,013,761.81 —— ——
Chemical Co., Ltd. assets
(5) Asset transfer and debt restructuring of related parties
Content of related party
Related party 2022 2021
transactions
The pelletizing -sintering
Shougang Mining Corporation 1,300,325,799.36 --
business
(6) Remuneration of key management personnel
The Company has 21 key management personnel in 2022, and 22 key management personnel in
2021. The remuneration payment is as follows:
Item 2022 2021
Remuneration of key management personnel
8.6681 million 12.3913 million
(excluding share payment)
199
Beijing Shougang Co. Ltd Annual Report 2022
6. Receivables from and payables to related parties
(1) Receivables from related parties
As at 31 December 2022 As at 31 December 2021
Item Related party
Book balance Provision for bad debts Book balance Provision for bad debts
Bank deposits Shougang Group Finance Co., Ltd. 8,782,663,274.02 -- 9,993,599,779.82 --
Bank deposits Hua Xia Bank Co.,Ltd. 6,713,364.79 -- 92,946,504.55 --
Accounts receivable Beijing Shougang Gas Co., Ltd. -- -- 3,870,237.73 135,713.01
Accounts receivable Shougang Group Co., Ltd. 57,479.37 2,047.03 57,219.54 2,006.45
Accounts receivable Shougang Casey Steel Co., Ltd. 290,361,751.31 10,336,878.35 259,971,350.16 9,116,105.40
Beijing Shougang Huaxia Engineering&Technology
Accounts receivable 1,748,412.19 487,967.75 1,623,946.24 56,944.99
Co., Ltd.
Accounts receivable Hebei Shoulang New Energy Technology Co., Ltd. 34,418,648.92 1,225,303.90 23,052,262.12 808,346.19
Accounts receivable Qian'an Shoujia Construction Material Co., Ltd. 56,221,363.06 2,002,230.58 61,221,363.06 2,146,776.55
Accounts receivable Sanhe Shoujia Construction Material Co., Ltd. 8,775,968.24 8,214,183.99 9,275,968.24 6,437,863.04
Accounts receivable Qinhuangdao Shouqin Metal Materials Co., Ltd. 1,438,064.93 1,070,495.53 1,438,064.93 403,415.27
Accounts receivable Tonghua Iron and Steel Co., Ltd. 506,248.00 17,810.17 810,000.00 28,403.30
Tangshan Caofeidian Dunshi New Construction
Accounts receivable -- -- 4,028.00 141.25
Material Co., Ltd.
Beijing Shougang International
Accounts receivable 428,540.00 297,559.83 412,800.00 401,297.79
Engineering&Technology Co., Ltd.
Accounts receivable Qian'an Shougang Xingkuang Industrial Co., Ltd. 6,617,509.64 235,583.34 9,607,053.73 336,879.10
Accounts receivable Beijing Shougang Mining Construction Co., Ltd. 9,958.00 349.19 -- --
Tianjin Shougang Steel Processing&Distribution Co.,
Accounts receivable -- -- 1,261,607.93 44,239.30
Ltd.
Accounts receivable Tangshan Shougang Jingtang Xishan Coking Co., Ltd. 734.50 218.70 734.50 25.76
200
Beijing Shougang Co. Ltd Annual Report 2022
As at 31 December 2022 As at 31 December 2021
Item Related party
Book balance Provision for bad debts Book balance Provision for bad debts
Accounts receivable Beijing Shougang Machinery&Electric Co., Ltd. 100,000.00 3,561.33 42,400.00 1,486.79
Beijing Shouke Xingye Engineering Technology Co.,
Accounts receivable 400,000.00 112,210.59 900,000.00 31,559.23
Ltd.
Accounts receivable Tangshan Tangcao Railway Co., Ltd. 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 771,150.00 27,041.00 -- --
Co., Ltd.
Prepayments Tonghua Iron and Steel Co., Ltd. 20,254,497.50 -- 16,968,576.00 --
Prepayments Tangshan Caofeidian Ganglian Logistics Co., Ltd. 87,043,657.93 -- 262,876,222.88 --
Prepayments Qinhuangdao Shouqin Metal Materials Co., Ltd. -- -- 763,907.90 --
Prepayments Tangshan Caofeidian Industry Port Co., Ltd. 1,760,930.71 -- -- --
Prepayments Beijing Jinanyuan Automobile Transportation Co., Ltd. 4,996,705.97 -- 671,424.66 --
Prepayments Chengde Xintong Shoucheng Mining Co., Ltd. -- -- 10,522,946.92 --
Prepayments Shougang Group Co., Ltd. 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 4,171,441.39 -- -- --
Ltd.
Prepayments Shougang Changzhi Steel&Iron Co., Ltd. 7,609.04 -- -- --
Dividend receivable Guangzhou Jinghai Shipping Co., Ltd. 200,000.00 -- -- --
Other current assets Tangshan Zhonghong Carbon Chemical Co., Ltd. 285,013,761.81 118,133,658.14 265,361,158.14 118,133,658.14
201
Beijing Shougang Co. Ltd Annual Report 2022
(2) Payables to related parties
As at 31 December As at 31 December
Item Related party
2022 2021
Accounts payable Shougang Group Co., Ltd. 655,732,407.11 1,384,249,837.28
Accounts payable Shougang Mining Corporation 4,125,595,337.09 4,522,110,751.63
Accounts payable Qian'an Sinochem Coal Chemical Industrial Co., Ltd. 470,845,391.07 580,911,994.24
Accounts payable Tangshan Shougang Jingtang Xishan Coking Co., Ltd. 1,859,004,046.73 502,790,483.78
Accounts payable Beijing Shoucheng Packaging Service Co., Ltd. 13,350,654.51 13,987,818.77
Beijing Shougang Automation Information Technology
Accounts payable 182,889,510.51 206,945,927.88
Co., Ltd.
Accounts payable Beijing Shougang Construction Group Co., Ltd. 618,622,996.56 815,350,440.40
Accounts payable Beijing Shoujian Equipment Maintenance Co., Ltd. 25,594,363.58 22,827,921.30
Accounts payable Beijing Shougang Landscaping Co., Ltd. 23,883,634.56 19,375,454.67
Accounts payable Beijing Shougang Catering Co., Ltd. 1,327,588.66 1,276,876.62
Accounts payable Beijing Huaxia Technology Co., Ltd. 5,762,815.76 5,949,926.35
Accounts payable Qinhuangdao Shougang Machinery Co., Ltd. 64,415,151.43 77,660,313.32
Accounts payable Beijing Shougang Machinery&Electric Co., Ltd. 162,405,176.47 132,681,857.63
Accounts payable Beijing Shouye Instruments&Meters Co., Ltd. 13,442,009.63 13,682,200.89
Accounts payable Tianjin Shougang Electric Equipment Co., Ltd. 9,099,757.38 16,682,673.00
Accounts payable Beijing Shougang Gas Co., Ltd. 66,619,195.56 51,211,959.35
Beijing Shougang International
Accounts payable 310,818,935.04 512,869,667.60
Engineering&Technology Co., Ltd.
Accounts payable Beijing Jinanyuan Automobile Transportation Co., Ltd. 15,100,355.24 10,002,976.59
Lujiashan Limestone Mining of Shougang Beijing Co.,
Accounts payable 158,972,406.25 68,994,235.34
Ltd.
Beijing Shougang Huaxia Engineering&Technology
Accounts payable -- 174,964.00
Co., Ltd.
Accounts payable Qian'an Shougang Equipment Structure Co., Ltd. 85,360,764.98 79,254,052.59
Accounts payable Yantai Shougang Mining 3D Co., Ltd. 313,811.63 337,462.12
Beijing Shoujian Hengji Construction Engineering Co.,
Accounts payable 1,602,115.93 1,355,139.65
Ltd.
Accounts payable Beijing Soly Technology Co., Ltd. 210,904.43 1,322,967.10
Qian'an Shouxin Automation Information Technology
Accounts payable 25,515,132.74 18,536,805.29
Co., Ltd.
Accounts payable Qian'an First Real Packaging Service Co., Ltd. 96,388,811.17 108,038,561.30
Beijing Shougang Refractory& Metallurgical
Accounts payable -- 15,421,690.84
Burden Co., Ltd.
Accounts payable Beijing Shoujia Steel Construction Co., Ltd. 14,995,775.16 5,451,674.96
Accounts payable Beijing Shougang Ferroalloy Co., Ltd. 73,607,022.86 56,826,692.95
Accounts payable Beijing Shougang Materials Trading Co., Ltd. 426,891,995.64 218,553,880.01
202
Beijing Shougang Co. Ltd Annual Report 2022
As at 31 December As at 31 December
Item Related party
2022 2021
Beijing Shougang Resources Comprehensive Utilization
Accounts payable 57,690,426.64 57,690,426.64
Technology Development Co., Ltd.
Accounts payable Shougang Environmental Industry Co., Ltd. 334,080.00 829,080.00
China Shougang International Trade&Engineering
Accounts payable 663,787,332.95 402,434,528.89
Corporation
Accounts payable Beijing Chengxin Engineering Supervision Co., Ltd. 6,127,851.86 4,895,538.32
Accounts payable Qinhuangdao Shougang Krosaki Refractory Co., Ltd. 61,808,291.36 53,995,540.32
Accounts payable Tangshan Shoukuang Cleaning Iron Co., Ltd. -- 137,489,080.84
Accounts payable Tangshan Guoxing Industrial Co., Ltd. 40,465,093.70 37,617,722.80
Tangshan Caofeidian Industrial District Shouhanxin
Accounts payable 138,903,339.92 162,441,310.98
Industrial Co., Ltd.
Accounts payable Beijing Shougang Futong Elevator Co., Ltd. 310,319.85 178,815.55
Accounts payable Beijing Teyu Plate Co., Ltd. 85,095,430.63 85,095,430.63
Accounts payable Jingxi Shoutang Supply Chain Management Co., Ltd 9,289,106.10 888,650.02
Accounts payable Beijing Shougang Mining Construction Co., Ltd. 3,354,289.89 27,209,286.63
Accounts payable Qinhuangdao Shouqin Metal Materials Co., Ltd. 19,824,419.55 17,970,896.72
Qinhuangdao Shouqin Steel Machining&Delivery Co.,
Accounts payable 466,070.62 361,229.80
Ltd.
Accounts payable Beijing Shoushe Metallurgical Technology Co., Ltd. 14,002.60 42,036.40
Accounts payable Beijing Shougang Fulushi Color Coated Plate Co., Ltd. -- 10,950,942.80
Accounts payable Beijing Shougang Industrial Group Co., Ltd. 24,377,193.66 10,454,655.52
Accounts payable Bejing Shougang International Travel Co., Ltd. 8,688.00 144,566.00
Accounts payable Beijing Shougang Cultural Development Co., Ltd. -- 157,950.00
Beijing Shougang Yunxiang Industrial Technology Co.,
Accounts payable 3,664,099.23 2,396,999.79
Ltd.
Accounts payable Qiangang Hotel. 8,662,628.97 12,384,514.68
Accounts payable Beijing Dingshengcheng Packaging Materials Co., Ltd. 17,452,797.76 14,641,606.12
Accounts payable Beijing Shougang Special Steel Co., Ltd. 94,949,940.33 101,949,940.33
Accounts payable Hebei Shougang Jingtang Machinery Co., Ltd. 18,999,797.17 4,208,507.88
Ningbo Metallurgical Investigation, Design&Research
Accounts payable 7,330,595.55 7,313,225.55
Co., Ltd.
Accounts payable Qian'an Shougang Xingkuang Industrial Co., Ltd. 4,945,999.84 10,413,229.91
Accounts payable Bohai International Conference Center Co., Ltd. -- 104,450.00
Beijing Thermal Zhongda Heat Exchange Equipment
Accounts payable 25,442,826.43 26,612,943.68
Co., Ltd.
Accounts payable Beijing Shouyi Mining Hospital Co., Ltd. 1,958,389.00 3,630,791.00
Accounts payable Beijing Shouyu Industry and Trade Co., Ltd. 7,177,859.06 7,359,998.22
Accounts payable PetroChina Shougang (Beijing) Petroleumsales Co., Ltd. 14,973,290.67 11,432,572.79
Accounts payable YASKAWA Shougang Robert Co., Ltd. 235,384.79 388,207.98
203
Beijing Shougang Co. Ltd Annual Report 2022
As at 31 December As at 31 December
Item Related party
2022 2021
Accounts payable Beijing Shoubang New Material Co., Ltd. 2,927,759.28 1,685,368.21
Beijing Xingyeda Machinery&Electric Equipment
Accounts payable 1,845,155.82 1,056,900.10
Manufacture Co., Ltd.
Accounts payable Chaoyang Shougang Beifang Machinery Co., Ltd. 931,110.35 1,019,783.85
Accounts payable Chengde Xintong Shoucheng Mining Co., Ltd. 851,714.56 --
Accounts payable Guangzhou Jinghai Shipping Co., Ltd. 102,688,729.55 113,750,687.97
Accounts payable Jingtang Port Shougang Terminal Co., Ltd. -- 2,927.40
Accounts payable Tangshan Caofeidian Industry Port Co., Ltd. 55,335,586.91 62,255,892.01
Accounts payable Shougang Guiyang Special Steel Co., Ltd. 6,975,000.00 10,488,904.44
Tianjin Shougang Steel Processing&Distribution Co.,
Accounts payable 149,948.85 208,116.72
Ltd.
Accounts payable Cmi Engineering (Beijing) Co., Ltd. 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. 1,545,599.81 1,673,343.05
Accounts payable Beijing Shougang Mining Investment Co., Ltd -- 175,708,332.43
Accounts payable Qinhuangdao Shougang Racing Valley Co., Ltd 95,860.00 229,160.00
Accounts payable Beijing Shougang Property Management Co., Ltd. -- 1,957,224.08
Beijing Shougang Park Comprehensive Service Co.,
Accounts payable 2,300.00 4,700.00
Ltd.
Accounts payable Beijing Shouao Real Estate Co., Ltd -- 33,960.00
Guangdong Shougang Zhongshan Metal Steel
Accounts payable -- 29,597.98
Processing&Distribution Co., Ltd.
Accounts payable Tonghua Iron and Steel Co., Ltd. -- 3,754,243.16
Beijing Shougang Environmental Engineering
Accounts payable 1,109,886.20 1,039,146.20
Technology Co., Ltd.
Accounts payable Guiyang Steel Mills I/E Corp. 4,161,841.55 6,450,970.10
Qian'an Jinyu Shougang Environmental Protection
Accounts payable 5,274,968.79 1,650,945.20
Technology Co., Ltd.
Accounts payable Mine Hospital of Shougang Group Co. Ltd. -- 411,453.00
Accounts payable Shougang Commercial Factoring Co., Ltd. 17,148,576.40 94,520.31
Tangshan Caofeidian Dunshi New Construction Material
Accounts payable 1,888,425.49 757,423.42
Co., Ltd.
Accounts payable Tangshan Shougang Malanzhuang Iron Ore Co., Ltd. 132,159,697.12 68,415,101.59
Beijing Shoutaizhongxin Science & Technology Co.,
Accounts payable 6,185,421.93 --
Ltd
Accounts payable Peking University Shougang Hospital 3,088,704.96 --
Contract liabilities Beijing Shoucheng Packaging Service Co., Ltd. 53,217.02 716,930.07
Beijing Shougang Huaxia Engineering&Technology
Contract liabilities 1,494,914.05 5,245,386.29
Co., Ltd.
Contract liabilities Beijing Beiye Functional Materials Co., Ltd. 34,194.22 1,060,401.14
204
Beijing Shougang Co. Ltd Annual Report 2022
As at 31 December As at 31 December
Item Related party
2022 2021
Contract liabilities Beijing Shougang Gitane New MATERIALS Co., Ltd. 45,093.66 45,093.66
Contract liabilities Beijing Shouronghui Technology Development Co., Ltd. 6,564,678.23 5,659,780.67
Contract liabilities Beijing Shougang Machinery&Electric Co., Ltd. 9,143,010.03 9,900,333.17
Contract liabilities Beijing Shougang Construction Group Co., Ltd. 385,946.71 112,823.19
Tangshan Caofeidian Industrial District Shouhanxin
Contract liabilities -- 5,000,915.64
Industrial Co., Ltd.
Contract liabilities Qinhuangdao Shougang Machinery Co., Ltd. 1,031,671.69 858,701.10
Tangshan Caofeidian Industrial Zone Jingtang Industrial
Contract liabilities 50,000.00 31,485.93
Co., Ltd.
Contract liabilities Tangshan Guoxing Industrial Co., Ltd. -- 28,189.37
Beijing Shougang International
Contract liabilities -- 312,038.71
Engineering&Technology Co., Ltd.
Contract liabilities Qian'an First Real Packaging Service Co., Ltd. 2,164,319.43 781,919.64
Tangshan Caofeidian Dunshi New Construction Material
Contract liabilities 1,901,697.48 1,325,363.50
Co., Ltd.
Contract liabilities Beijing Jinanyuan Automobile Transportation Co., Ltd. 341,185.21 50,000.00
Contract liabilities Qian'an Shougang Equipment Structure Co., Ltd. 14,753.10 --
Contract liabilities Qinhuangdao Shougang Plate Mill Co., Ltd. 13,028.81 13,028.81
Contract liabilities Qinhuangdao Shougang Krosaki Refractory Co., Ltd. 182,697.15 182,697.15
Lujiashan Limestone Mining of Shougang Beijing Co.,
Contract liabilities 1,378,893.98 1,378,594.00
Ltd.
Contract liabilities Qian'an Shougang Xingkuang Industrial Co., Ltd. 50,000.00 50,000.00
Contract liabilities Beijing Shougang Materials Trading Co., Ltd. 188,861.00 188,861.00
Contract liabilities Guizhou Bohong Industrial Co., Ltd. 50,000.00 50,000.00
Contract liabilities Beijing Shougang Mining Construction Co., Ltd. 52,088.04 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 2,280.20
Contract liabilities Ningbo Shougang Zhejin Steel Co., Ltd. 18,320,032.79 18,370,671.65
Contract liabilities Guangzhou Jinghai Shipping Co., Ltd. 810,846.20 5,311,397.37
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 10,095,842.56
Ordos Baotou Steel Shourui Material Technology Co.,
Contract liabilities -- 3,865,016.99
Ltd.
Contract liabilities PetroChina Shougang (Beijing) Petroleumsales Co., Ltd. 7,184,262.58 12,452,455.41
Contract liabilities Shougang Casey Steel Co., Ltd. 51,682.17 645,198.15
Contract liabilities Shougang (Qingdao) Steel Industry Co., Ltd. 154,086,174.29 82,388,551.58
205
Beijing Shougang Co. Ltd Annual Report 2022
As at 31 December As at 31 December
Item Related party
2022 2021
Tianjin Shougang Steel Processing&Distribution Co.,
Contract liabilities -- 38,202.45
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. 487,472.16 572,635.52
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 111,022.04 105,416.50
Technology Co., Ltd.
Contract liabilities Shoujia Huanke (Qian'an) Co., Ltd. 200,000.00 200,000.00
Contract liabilities Beijing Shoujia Steel Construction Co., Ltd. 198,653.22 --
Contract liabilities Beijing Huaxia Technology Co., Ltd. 50,000.00 --
Contract liabilities Beijing Jingxi Supply Chain Management Co., Ltd. 747,440.91 --
Other payables Shougang Group Co., Ltd. 56,575,231.05 57,154,287.37
Other payables Shougang Mining Corporation 796,194,091.55 2,066,250,402.53
Beijing Shougang Automation Information Technology
Other payables -- 749,720.20
Co., Ltd.
Other payables Beijing Shougang Construction Group Co., Ltd. 3,450,000.00 3,458,000.00
Other payables Beijing Shougang Landscaping Co., Ltd. -- 19,893.26
Other payables Beijing Chengxin Engineering Supervision Co., Ltd. -- 269,324.00
Other payables Beijing Shougang Industrial Group Co., Ltd. 3,865,587.23 3,865,587.23
Other payables Tangshan Guoxing Industrial Co., Ltd. 4,450,973.55 4,450,973.55
Ningbo Metallurgical Investigation, Design&Research
Other payables -- 190,000.00
Co., Ltd.
Other payables Guangzhou Jinghai Shipping Co., Ltd. -- 311,320.00
Other payables Beijing Shougang Gas Co., Ltd. 1,123,099.67 1,650,000.00
Other payables Hebei Shougang Jingtang Machinery Co., Ltd. 2,776,577.52 2,776,577.52
Beijing Shouxin Jinyuan Management Consulting
Other payables 341,400,000.00 319,500,000.00
Center (Limited Partnership)
Tangshan Caofeidian Industrial Zone Jingtang Industrial
Other payables 2,910,814.91 --
Co., Ltd.
Other non-current
Shougang Group Co., Ltd. 4,532,018,467.20 4,563,283,607.60
liabilities
XI. Share-based payment
1. General information of share-based payment
Total equity instruments of the Company granted during the period None
Total exercised equity instruments of the Company during the period
Total invalid equity instruments of the Company during the period
206
Beijing Shougang Co. Ltd Annual Report 2022
Total equity instruments of the Company granted during the period None
Range of exercise prices and contractual remaining period for share options issued
by the Company at the end of the period
Range of exercise prices and remaining contractual maturity of other equity
instruments issued by the Company at the end of the period
2. Equity-settled share-based payment
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
The actual unlocked quantity is determined
Basis for determining the quantity of exercisable equity instruments
according to the performance assessment
Reasons for significant difference between the current estimate and previous
None
estimate
Accumulated amount of equity settled share-based payments recognized in capital
36,147,743.13
reserve
The total amount of expenses recognized for equity settled share-based payments in
43,289,500.60
this period
Note: 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 (Note
Ⅴ,34) and capital reserve (Note Ⅴ,35) 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 (Note Ⅴ,
24). 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.
The cost and expense recognized during the waiting period of this period is RMB 43,289,500.60,
and the consolidated capital reserve is increased by RMB 36,147,743.13 according to the
shareholding ratio of the subsidiaries.
XII. Commitments and contingencies
207
Beijing Shougang Co. Ltd Annual Report 2022
1. Material commitments
As at 31 December 2022, the Company has no commitments that should be disclosed.
2. Contingencies
As at 31 December 2022, the Company has no pending litigation, external guarantees or other
contingencies that should be disclosed.
XIII. Events after balance sheet date
As at 19 April 2023, the Company has no undisclosed event that should be disclosed after the
balance sheet date.
XIV. Other significant events
1. Segment information
According to internal organizational structure, management requirement and requirement of internal
reporting system, the Company divides businesses into iron and steel segment. The segment
information is determined based on the financial information required by routine internal
management of the Company. The management periodically evaluates the operating results of the
segment to determine its allocation of resources and evaluate the performance of the segment.
The segment information of the Company includes: iron and steel segment.
The segment information is disclosed in accordance with the accounting policies and measurement
basis used in the reports of the management, which are in line with those adopted in financial
statements.
(1) Segment profit or loss, assets and liabilities
Current period or end of current period Iron and steel Segment Offset Total
Operating revenue 118,142,183,549.47 -- 118,142,183,549.47
Including: External revenue 118,142,183,549.47 -- 118,142,183,549.47
Inter-segment revenue -- -- --
Including: Main operating revenue 114,602,567,434.30 -- 114,602,567,434.30
Cost of sales 111,067,555,320.28 -- 111,067,555,320.28
Including: Main operating cost of sales 108,013,843,862.04 -- 108,013,843,862.04
Operating expenses 2,959,357,105.57 -- 2,959,357,105.57
Operating profit/(loss) 1,849,891,701.37 -- 1,849,891,701.37
Total assets 143,173,445,003.35 -- 143,173,445,003.35
Total liabilities 93,101,365,568.38 -- 93,101,365,568.38
Supplementary information:
1.Capital expenditure 2,639,013,873.80 -- 2,639,013,873.80
208
Beijing Shougang Co. Ltd Annual Report 2022
Current period or end of current period Iron and steel Segment Offset Total
2.Depreciation and amortisation 7,798,817,196.94 -- 7,798,817,196.94
3.Non-cash expenses other than depreciation and amortisation -- -- --
4. 4.Assets impairment losses 397,351,033.00 -- 397,351,033.00
Prior period or end of prior period Iron and steel Segment Offset Total
Operating revenue 132,984,304,668.28 -- 132,984,304,668.28
Including: External revenue 132,984,304,668.28 -- 132,984,304,668.28
Inter-segment revenue -- -- --
Including: Main operating revenue 129,315,463,715.41 -- 129,315,463,715.41
Cost of sales 117,394,695,070.53 -- 117,394,695,070.53
Including: Main operating cost of sales 114,564,031,235.41 -- 114,564,031,235.41
Operating expenses 3,231,863,744.12 -- 3,231,863,744.12
Operating profit/(loss) 9,966,873,058.08 -- 9,966,873,058.08
Total assets 149,442,546,290.82 -- 149,442,546,290.82
Total liabilities 100,446,388,993.42 -- 100,446,388,993.42
Supplementary information:
1.Capital expenditure 3,270,336,323.78 -- 3,270,336,323.78
2.Depreciation and amortisation 7,533,131,606.57 -- 7,533,131,606.57
3.Non-cash expenses other than depreciation and amortisation -- -- --
4.Assets impairment losses 295,107,454.68 -- 295,107,454.68
(2) Other segment information
① External revenue of goods and services
Item 2022 2021
Iron and steel 118,142,183,549.47 132,984,304,668.28
② Geographical information
No more details of geographical information should be disclosed as the production and sales of the
Company are all located in mainland China.
2. Lease
The Company as lessee
Additional information on rental fees
① The Company simplifies the treatment of short-term leases and low-value leases, and
unrecognized right-of-use assets and lease liabilities. The information of short-term leases,
low-value leases and variable lease payments measured outside lease liabilities included in the
209
Beijing Shougang Co. Ltd Annual Report 2022
current profit and loss are as follows:
Item 2022
short-term leases 1,524,402.52
low-value leases --
variable lease payments measured outside lease liabilities --
The Company as lessor
Formation of operating leases:
② lease revenue, and separately disclose income related to variable lease payments not included in
lease receipts;
Item 2022
lease revenue 38,048,285.06
income related to variable lease payments not included in lease receipts --
③ 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 2022.12.31
Within 1 year 33,328,200.36
1 – 2 years 1,793,773.33
2 – 3 years --
3 – 4 years --
4 – 5 years --
Over 5 years --
Total 35,121,973.69
XV. Notes to the financial statements of parent company
1. Notes receivable
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
Item 2021.12.31
210
Beijing Shougang Co. Ltd Annual Report 2022
Book balance Bad debt provision Net carrying value
Bank acceptances -- -- --
Commercial acceptances 1,312,696,288.07 1,312,696.29 1,311,383,591.78
Total 1,312,696,288.07 1,312,696.29 1,311,383,591.78
(1) The pledged notes receivable of the Company at the end of the year
Item Amount pledged as of December 31, 2022
Commercial acceptances 1,090,000.00
(2) Outstanding endorsed or discounted notes that have not matured at the end of the year
Amount derecognized as of December 31, Amount not-derecognized as of December
Item
2022 31, 2022
Bank acceptances -- --
Commercial acceptances -- 854,747,997.30
Total -- 854,747,997.30
(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, 2022
Commercial acceptance notes 2,000,000.00
(4) Classified by bad debt provision method
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
Portfolio 1 -- -- -- - --
Portfolio 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
Continued:
2021.12.31
Category Book balance Bad debt provision
Net carrying
Expected value
Amount Proportion (%) Amount
credit loss (%)
211
Beijing Shougang Co. Ltd Annual Report 2022
2021.12.31
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
1,312,696,288.07 100.00 1,312,696.29 0.10 1,311,383,591.78
based on credit risk
characteristics
Group 1 -- -- -- - --
Group 2 1,312,696,288.07 100.00 1,312,696.29 0.10 1,311,383,591.78
Total 1,312,696,288.07 100.00 1,312,696.29 0.10 1,311,383,591.78
(5) Provision, recovery or reversal of bad debt
Item Bad debt provision
As at 1 January 2022 1,312,696.29
Provision --
Recovery or reversal 413,156.60
Written-off --
As at 31 December 2022 899,539.69
(6) The Company has no notes receivable actually written off in reporting period.
2. Accounts receivable
(1) Disclosed by ageing of account receivables
Ageing 2022.12.31 2021.12.31
Within 1 year 1,398,579,212.14 1,917,663,119.14
1 – 2 years -- 3,197,756.62
2 – 3 years 2,197,756.62 6,327,199.80
Over 3 years 8,578,211.62 2,751,011.82
Subtotal 1,409,355,180.38 1,929,939,087.38
Less: provision for bad debts 12,694,254.85 12,046,892.38
Total 1,396,660,925.53 1,917,892,195.00
(2) Disclosed by bad debt provision
2022.12.31
Book balance Bad debt provision
Category
Net carrying
Expected
Proportion value
Amount Amount credit loss
(%)
(%)
212
Beijing Shougang Co. Ltd Annual Report 2022
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
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
Continued:
2021.12.31
Book balance Bad debt provision
Category
Net carrying
Expected
Proportion value
Amount Amount credit loss
(%)
(%)
Assessed bad debt
5,751,011.82 0.30 5,751,011.82 100.00 --
provision individually
Assessed bad debt
provision in portfolios
1,924,188,075.56 99.70 6,295,880.56 0.33 1,917,892,195.00
based on credit risk
characteristics
Portfolio of aging analysis 80,928,756.18 4.19 6,295,880.56 7.78 74,632,875.62
Portfolio of consolidation
1,843,259,319.38 95.51 -- -- 1,843,259,319.38
scope
Total 1,929,939,087.38 100.00 12,046,892.38 0.62 1,917,892,195.00
Assessed bad debt provision individually：
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
Continued:
2021.12.31
Accounts receivable (by
debtor) Expected credit loss Reason for
Book balance Bad debt provision
(%) bad debts
213
Beijing Shougang Co. Ltd Annual Report 2022
2021.12.31
Accounts receivable (by
debtor) Expected credit loss Reason for
Book balance Bad debt provision
(%) bad debts
Accounts receivable over
2,751,011.82 2,751,011.82 100.00 Long aging
3 years
Recourse for overdue
Recourse for overdue bills 3,000,000.00 3,000,000.00 100.00
bills
Total 5,751,011.82 5,751,011.82 100.00
Assessed bad debt provision in portfolios：
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
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
Continued:
2021.12.31
Item
Accounts receivable Bad debt provision Expected credit loss (%)
Within 1 year 1,917,663,119.14 2,609,029.34 0.14
1 – 2 years 2,197,756.62 616,528.89 28.05
2 – 3 years 4,327,199.80 3,070,322.33 70.95
Over 3 years -- -- --
Total 1,924,188,075.56 6,295,880.56 0.33
(3) Provision, recovery or reversal of bad debt
Item Bad debt provision
As at 1 January 2022 12,046,892.38
Provision 647,362.47
Recovery or reversal --
Written-off --
As at 31 December 2022 12,694,254.85
(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 1,397,675,296.54, accounting for 99.18% of the total amount of accounts
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Beijing Shougang Co. Ltd Annual Report 2022
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 10,349,521.85.
Closing balance of Closing balance of
Company Name Percentage %
accounts receivable provision
Beijing Shougang Cold Rolling Co., Ltd. 1,303,469,746.34 92.49 --
Shougang Zhixin Qian'an Electromagnetic
25,470,650.96 1.81 --
Materials Co., Ltd.
Qian'an Shoujia Construction Material Co., Ltd. 56,221,363.06 3.99 2,002,230.58
Nantong Zhongji Energy Equipment Co., Ltd.. 3,737,567.94 0.27 133,107.28
Sanhe Shoujia Construction Material Co., Ltd. 8,775,968.24 0.62 8,214,183.99
Total 1,397,675,296.54 99.18 10,349,521.85
3. Financing receivables
Item 2022.12.31 2021.12.31
Notes receivable 835,526,685.55 1,285,597,772.66
Less：Other comprehensive income - fair value changes -- --
Closing balance of fair value 835,526,685.55 1,285,597,772.66
(1) Classified by bad debt provision method
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
Continued:
2021.12.31
Book balance Bad debt provision
Category
Expected Net carrying value
Proportion
Amount Amount credit loss
(%)
(%)
Assessed bad debt provision
individually
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Beijing Shougang Co. Ltd Annual Report 2022
Assessed bad debt provision
in portfolios
1,285,854,943.65 100.00 257,170.99 0.02 1,285,597,772.66
based on credit risk
characteristics
Portfolio 1 1,285,854,943.65 100.00 257,170.99 0.02 1,285,597,772.66
Portfolio 2 -- -- -- -- --
Total 1,285,854,943.65 100.00 257,170.99 0.02 1,285,597,772.66
(2) Provision, recovery or reversal of bad debt
Item Bad debt provision
As at 1 January 2022 257,170.99
Provision --
Recovery or reversal 90,032.23
Written-off --
As at 31 December 2022 167,138.76
(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, 2022 December 31, 2022
Bank acceptance notes 4,382,619,253.99 --
Commercial acceptance notes -- --
Total 4,382,619,253.99 --
4. Other receivables
Item 2022.12.31 2021.12.31
Dividends receivable 9,713,244.06 --
Other receivables 1,154,281,751.62 1,017,482,945.07
Total 1,163,994,995.68 1,017,482,945.07
(1) Dividends receivable
Item 2022.12.31 2021.12.31
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
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Beijing Shougang Co. Ltd Annual Report 2022
Ageing 2022.12.31 2021.12.31
Within 1 year 1,154,320,981.69 1,017,487,983.11
1 – 2 years -- 516,288.00
2 – 3 years -- --
Over 3 years -- --
Subtotal 1,154,320,981.69 1,018,004,271.11
Less: provision for bad debts 39,230.07 521,326.04
Total 1,154,281,751.62 1,017,482,945.07
② Disclosed by nature of other receivables
2022.12.31
Item
Book balance Provision for bad debts Carrying value
Petty cash 282,590.68 14,129.53 268,461.15
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
Continued:
2021.12.31
Item
Book balance Provision for bad debts Carrying value
Petty cash 98,749.98 4,937.50 93,812.48
Deposits -- -- --
Due from other companies 2,010.86 100.54 1,910.32
Due from intra-companies 1,017,387,222.27 -- 1,017,387,222.27
Court attachment 516,288.00 516,288.00 --
Total 1,018,004,271.11 521,326.04 1,017,482,945.07
③ Provision for bad debts
As at 31 December 2022, bad debts provision for Phase I:
Expected credit loss
Carrying
Category Book balance within 12 months Provisions Reasons
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
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Beijing Shougang Co. Ltd Annual Report 2022
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
As at 31 December 2021, bad debts provision for Phase I:
Expected credit loss
Carrying
Category Book balance within 12 months Provisions Reasons
value
(%)
Assessed bad debt provision
-- -- -- --
individually
Assessed bad debt provision in
1,017,487,983.11 -- 5,038.04 1,017,482,945.07
portfolios
Petty cash and deposits 98,749.98 5.00 4,937.50 93,812.48
Due from other companies 2,010.86 5.00 100.54 1,910.32
Due from intra-companies 1,017,387,222.27 -- -- 1,017,387,222.27
Total 1,017,487,983.11 -- 5,038.04 1,017,482,945.07
As at 31 December 2021, the Company has no other receivables in Phase II
As at 31 December 2021, bad debts provision for Phase III:
Expected credit loss
Carrying
Category Book balance within 12 months Provisions Reasons
value
(%)
Assessed bad debt provision
individually
Yinchuan Intermediate People's
516,288.00 100.00 516,288.00 --
Court
④ Provision, 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)
As at 1 January 2022 5,038.04 -- 516,288.00 521,326.04
Changes during the year:
-- Shift to Phase II -- -- -- --
-- Shift to Phase III -- -- -- --
-- Back to Phase II -- -- -- --
-- Back to Phase I -- -- -- --
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Beijing Shougang Co. Ltd Annual Report 2022
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)
Provision 34,192.03 -- -- 34,192.03
Reversal -- -- 516,288.00 516,288.00
Converse -- -- -- --
Written-off -- -- -- --
Other movements -- -- -- --
As at 31 December 2022 39,230.07 -- -- 39,230.07
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
1,147,536,380.15 99.41 --
Steel Co., Ltd. intra-companies year
Shenyang Shougang steel processing Due from Within 1
6,000,000.00 0.52 --
and Distribution Co., Ltd. intra-companies year
China Petroleum Materials Company Within 1
Deposits 500,000.00 0.04 25,000.00
Limited year
Within 1
Petty cash Petty cash 282,590.68 0.02 14,129.53
year
Total 1,154,318,970.83 99.99 39,129.53
5. Long-term equity investments
2022.12.31 2021.12.31
Item Provision for Provision for
Book balance Carrying value Book balance Carrying value
impairment impairment
Investments in
36,621,384,419.98 -- 36,621,384,419.98 30,737,545,762.35 -- 30,737,545,762.35
subsidiaries
Investment in
1,066,506,040.90 -- 1,066,506,040.90 1,258,787,177.81 -- 1,258,787,177.81
associates
Total 37,687,890,460.88 -- 37,687,890,460.88 31,996,332,940.16 -- 31,996,332,940.16
(1) Investments in subsidiaries
Impairment
Provision for
Subsidiaries 2022.1.1 Increase Decrease 2022.12.31 at the end of
impairment
the year
Shougang Jingtang
United Iron & Steel Co., 16,288,241,360.88 19,967,378.70 -- 16,308,208,739.58 -- --
Ltd.
Beijing Shougang Cold
1,831,251,988.00 1,063,865.00 -- 1,832,315,853.00 -- --
Rolling Co., Ltd.
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Beijing Shougang Co. Ltd Annual Report 2022
Impairment
Provision for
Subsidiaries 2022.1.1 Increase Decrease 2022.12.31 at the end of
impairment
the year
Qian'an Shougang
Metallurgical 1,900,000.00 -- -- 1,900,000.00 -- --
Technology Co., Ltd.
Shougang Zhixin
Qian'an Electromagnetic 7,484,303,856.61 1,802,434.10 -- 7,486,106,290.71 -- --
materials Co., Ltd.
Beijing Shougang New
Energy Automobile
450,022,411.20 135,401.00 -- 450,157,812.20 -- --
Material Technology
Co., Ltd.
Beijing Shougang Steel
Trading Investment 4,681,826,145.66 5,860,869,578.83 -- 10,542,695,724.49 -- --
Management Co., Ltd.
Total 30,737,545,762.35 5,883,838,657.63 -- 36,621,384,419.98 -- --
Note: the long-term equity investments of RMB 24,880,434.00 was increased due to equity
incentive during the reporting period.
(2) Investments in associates
Changes during the year
Impairment
Associates 2022.1.1 Investment 2022.12.31 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 1,098,085,352.91 -- -- -206,574,842.59 -- -- -- -- -- 891,510,510.32 --
Industrial Co., Ltd.
Beijing Shouxin
Jinyuan
Management
112,715,820.57 -- -- 24,947,007.16 -- -- 15,232,424.74 -- -- 122,430,402.99 --
Consulting Center
(Limited
Partnership)
Beijing
Dingshengcheng
13,987,090.36 -- -- 2,843,468.38 -- -- -- -- -- 16,830,558.74 --
Packaging
Materials Co., Ltd.
Qian'an Jinyu
Shougang
Environmental
33,998,913.97 1,208,074.76 -- 527,580.12 -- -- -- -- -- 35,734,568.85 --
Protection
Technology Co.,
Ltd.
Total 1,258,787,177.81 1,208,074.76 -- -178,256,786.93 -- -- 15,232,424.74 -- -- 1,066,506,040.90 --
6. Operating revenue and costs of sales
(1) Operating revenue and costs of sale
2022 2021
Item
Revenue Cost of sales Revenue Cost of sales
Main business 37,952,493,407.65 37,315,733,518.02 42,977,859,406.94 40,552,466,616.01
Other business 1,052,315,697.44 880,022,135.85 1,059,296,154.23 773,076,389.36
Total 39,004,809,105.09 38,195,755,653.87 44,037,155,561.17 41,325,543,005.37
(2) Operating revenue and operating costs of sale by product
Product type 2022 2021
220
Beijing Shougang Co. Ltd Annual Report 2022
Revenue Cost of sales Revenue Cost of sales
Main business:
Billet 546,474,748.00 473,163,072.64 576,652,349.47 524,683,887.65
Hot rolled 36,748,637,995.88 36,218,585,936.96 41,398,472,411.41 39,093,488,700.61
Cold rolled -- -- -- --
Other steel products 657,380,663.77 623,984,508.42 1,002,734,646.06 934,294,027.75
Subtotal 37,952,493,407.65 37,315,733,518.02 42,977,859,406.94 40,552,466,616.01
Other business:
power 603,897,153.58 692,208,727.34 514,071,930.10 564,622,140.71
Solid waste 16,142,266.98 14,549,025.28 36,702,556.92 32,811,328.92
Others 432,276,276.88 173,264,383.23 508,521,667.21 175,642,919.73
Subtotal 1,052,315,697.44 880,022,135.85 1,059,296,154.23 773,076,389.36
Total 39,004,809,105.09 38,195,755,653.87 44,037,155,561.17 41,325,543,005.37
(3) Breakdown of operating revenue
Item 2022
Main operating revenue 37,952,493,407.65
Including: recognized at a certain point 37,952,493,407.65
Recognized during a certain period of time --
Other revenue 1,052,315,697.44
Total 39,004,809,105.09
7. Investment income
Item 2022 2021
Investment income from long-term investment under cost method 230,168,137.37 --
Investment income from long-term investment under equity method -178,256,786.93 203,181,607.90
Dividend from other equity instruments investments 5,614,882.12 2,718,777.38
Interest income from entrusted loans 1,708,741.16 34,989,108.61
Total 59,234,973.72 240,889,493.89
XVI. Supplementary information
1. Non-recurring gains or losses
Item 2022 Note
Gains or losses on disposal of non-current assets -56,974,152.72
Government grants recognized in profit or loss during reporting period
(excluding those close related to the Company’s normal business,
67,816,372.72
conforming to the national policies and regulations and enjoying
ongoing fixed amount or quantity according to certain standard)
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Beijing Shougang Co. Ltd Annual Report 2022
Item 2022 Note
Current net profit or loss of subsidiary from the beginning of the period
55,404,276.08
to the date of the combination under the same control
Gains or losses from external entrusted loans 11,275,389.73
Non-operating income/(expenses) except the above 10,369,331.96
Other items that conform to the definition of non-recurring profit or loss --
Total non-recurring gains or losses 87,891,217.77
Less: income tax effect on non-recurring gains or losses 7,764,321.72
Net non-recurring gains or losses 80,126,896.05
Less: non-recurring gains or losses attributable to non-controlling
8,097,113.34
interests of the Company (after tax)
Non-recurring gains or losses attributable to shareholders of the
72,029,782.71
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
2.42 0.1496 --
company
Net profit/ (loss) attributable to shareholders of the
2.26 0.1400 --
Company excluding non-recurring gains or losses
Board of Directors of Beijing Shougang Company Limited
19 April 2023
222
