Stock Code: 200771 Stock ID: Hangqilun B Announcement No.：2021-14
Hangzhou Steam Turbine Co., Ltd.
Summary of 2020 Annual Report
I. Important Notice
This annual report summary is taken from the full text of the Annual Report. Investors are advised to read
carefully the full text of the Annual Report published on the media designated by China Securities Regulatory
Commission in order to fully understand the company’s operation results, financial position and future
The Board of Directors, The Supervisory Committee, the supervisors and the directors of the Company guarantee
that there are no significant omissions, fictitious or misleading statements carried in the Report and we will accept
individual and joint responsibilities for the truthfulness, accuracy and completeness of the Report.
Chairman Mr. Zheng Bin, Chief Financial Officer Zhao Jiamao, and the Chief of Accounting Department Mr.Jin
Can hereby declare: the Financial Statement in the report is guaranteed to be truthful and complete.
All of the directors attended the board meeting on which this report was examined.
This Report contains prospective descriptions, which doesn’t constitute substantial commitment to investors.
Investors are requested to be aware of the risks attached to their investment decisions.
Please refer to the prospects for the future development of the company in Section 4 for the risks in the
company's operations. The company's designated information disclosure media are: Shanghai Securities News
(Chinese), Securities Times (Chinese), Hong Kong Commercial Daily (English), http://www.cninfo.com.cn (In
English and Chinese), all information of the company is subject to the information published in the above selected
media. Investors are advised to pay attention to investment risks.
Non-standard auditor’s opinion
□ Applicable √ Not applicable
Plans for profit distribution on ordinary shares or conversion of capital reserves into share capital proposed to the
Board during the reporting period.
√ Applicable □ Not appliczble
Whether provident fund reserve for share capital
□ Yes √ No
The company's designated information disclosure media are: In 2020, with the total share capital of
754,010,400 shares at the end of the year deducting 19,551,800 treasury shares repurchased as of date of record by
Company, that is, 734,458,600 shares, the Company would distribute cash dividend to all the shareholders at the
rate of CNY 2.5 for every 10 shares (with tax inclusive) , 0 bonus shares ，and no reserve would be converted into
share capital.
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
Plans for profit distribution on preference shares for the reporting period approved by the Board
□ Applicable √ Not applicable
II. Basic information about the company
1. Company profile
Stock ID Hangqilun B Stock code 200771
Stock exchange for listing Shenzhen Stock Exchange
Contact person and contact
Board secretary Securities affairs Representative
manner
Name Li Guiwen Wang Caihua
Address No. 357 Shiqiao Rd. Hangzhou No. 357 Shiqiao Rd. Hangzhou
Fax 0571-85780433 0571-85780433
Tel 0571-85780058 0571-85780438
E-mail lgw@htc.cn wangch@htc.cn
2.Major operations or products during the reporting period
As the leading provider of turbo machinery equipment and relevant service in China, our company is mainly
famous for designing and producing rotating turbo machinery like industrial steam turbines and gas turbines. Our
company, one of the major companies drafting the industrial standard in Chinese domestic industry of industrial
steam turbine, has developed into the biggest base to research, develop and produce industrial steam turbines in
China and ranks first among industrial steam turbine producers in terms of the market occupancy. Holding the
principle “our products should be based on clients’ demands” as our business mode and characteristic, our
company designs and produces in accordance with every client’s personal demands so as to meet personalized
needs in engineering projects to the utmost. To realize the fast research and development of our products, our
company has adopted the advanced modular design technique and, on the other hand, introduces information
technique to assist the collaborative production to achieve the resource saving and flexible production. In addition,
our company also provides our clients with relevant service such as engineering programs, general engineering
contracting, operation and maintenance of our products as well as remote control and so on.
Industrial steam turbines use the steam featuring high temperature and high pressure as their working medium so
as to convert the thermal energy into mechanical energy to drive various industrial equipments through the
rotating steam turbines. As for different objects driven by industrial steam turbines, the steam turbines could be
divided into industrial driving steam turbines and industrial power-generation steam turbines. Mainly driving
rotating machines like compressors, air blowers, pumps and squeezers, industrial driving steam turbines, as the
core power part in numerous large-scale industrial equipments, are always introduced into some industries like oil
refining, chemical engineering, chemical fertilizer, building materials, metallurgy, electric power, light industry
and environmental production. The industrial power-generation steam turbines, mainly utilized to drive electric
generators and provide thermal energy, are mainly adopted in private stations, regional projects of combined heat
and power generation, power generation by recycling waste heat in industrial production, urban waster power
plants and gas-steam combined cyclepower stations in various industrial sectors. The gas turbines produced by
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
our company are mainly used by metallurgical industry to recycle the waste heat from the blast furnace exhaust to
generate power.
In the gas turbine business, the Company has cooperated with Siemens on the advanced natural gas turbine
SGT-800 model-with features of high efficiency, high reliability and low emission, thus to enter the distributed
natural gas field. As the general whole-set maker of SGT-800 in China, the company has launched the gas turbine
business in respect of the project procurement and the integrated implementation. Hangzhou Steam Turbine has
the type selection ability for the distributed energy combined cycle project, has established a complete system of
supporting standard and material system, and it can complete the independent processing or matching work for
the equipment besides the gas turbine body. In the industrial fields including the cogeneration /combined cycle
power plant and the oil & gas project with distributed energy projects that adopt the small and medium gas
turbines, the Company not only can provide gas turbine equipment for customers, but also can provide customers
with complete sets of equipment for gas turbine power plant and the efficient integrated solutions. Especially, it
can provide customers with operational support services throughout the product life, and this service model is
conductive for the establishment of long-term business cooperation relationships between the company and its
customers.
As the major producer of industrial equipments in China during the report period, our company is mainly
benefited from the following factors in terms of the elements driving our business performance:
1. On the basis of market demands. The relevant market demands fluctuate differently due to various
business condition and investment cycles in different industrial fields. The company further made more specified
positions toward the market for the products, implemented the differentiated marketing strategy, and integrated
the business sectors and tapped into the potential During the reporting period, the company fully grasped the
market characteristics such as the continuation of the refining-chemical integration, the warming of coal chemical
industry, and the improvement of customer concentration in the market, actively planned the "online marketing"
work mode and piloted the new carrier of "online+offline" work according to the needs of different customers,
further consolidate the original market position and expand the market share in new fields. The overseas
markets overcame the impact of the epidemic and further expanded their market influence.
2. Innovation and further reform in difficult areas of product technology.
Our company continuously improves product technical performance and tackles hard issues in the scientific
researches of product structure, core parts, basic design, manufacturing technology, material technology, etc. In
addition, basing on clients’ demands, our company launches the study “The Demonstration and Application
Project for Packaging Technology of Steam Turbine” to push forward the intelligence of our products and the
development of the integration technology. Meantime, the company cooperated with universities, scientific
research institutes to build the technological exchange and cooperation platform.
3. Upgrading and transformation of industrial structure transformation.The company jointed with Siemens to
enter the distributed energy market and enhance the development and utilization of natural gas distributed energy.
In the industrial fields including the cogeneration /combined cycle power plant and the oil & gas project with
distributed energy projects that adopt the small and medium gas turbines, the Company not only can provide gas
turbine equipment for customers, but also can provide customers with complete sets of equipment for gas turbine
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
power plant and the efficient integrated solutions.
4. Brand and market position. The company’s products have a good reputation and extensive brand
influence in the domestic market, The company has maintained a leading market share in the domestic industrial
drive. The company's products have a high reputation and brand influence in the domestic market.
5.Cost controlling level. As domestic labor costs continue to rise and the price of industrial products
continue to
decline, the product profitability is facing a severe test. In recent years, the company continuously improves the
level of costs controlling by improving the organizational structure, optimizing business processes, enhancing the
supply chain controlling, strengthening risk management, raising the efficiency of all the staff and so on.
6.Emphasis on quality engineering and services: promote the key project management, meticulously plan
key projects, implement dynamic quality supervision; attach importance to products’ after-sales service market,
integrate existing resources to increase after-sales service initiative, extend product value chain, and promote the
company’s transformation from manufacturing to service.
3.Major accounting data and financial indicators
（1）Major accounting data and financial indicators for the last three years
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
In RMB
Changed over
2020 2019 2018
last year（％）
Operating revenue（Yuan） 4,496,445,244.55 4,279,848,518.81 5.06% 4,642,807,589.69
Net profit attributable to the shareholders of the listed
459,345,443.38 345,138,064.00 33.09% 345,824,339.47
company（Yuan）
Net profit after deducting of non-recurring gain/loss
attributable to the shareholders of listed company 372,697,902.88 302,012,173.45 23.40% 280,075,101.48
（Yuan）
Cash flow generated by business operation, net（Yuan） 454,416,600.69 432,255,831.23 5.13% 644,433,167.20
Basic earning per share(Yuan/Share) 0.62 0.46 34.78% 0.46
Diluted gains per share(Yuan/Share) 0.62 0.46 34.78% 0.46
Net asset earning ratio（%） 6.24% 5.48% 0.76% 5.82%
Changed over
End of 2020 End of 2019 End of 2018
last year（％）
Gross assets（Yuan） 15,392,653,924.41 12,600,115,579.96 22.16% 11,569,169,903.81
Net assets attributable to shareholders of the listed
8,104,788,941.36 6,607,496,148.58 22.66% 6,007,540,929.16
company（Yuan）
（2）Main Financial Index by Quarters
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating income 697,880,677.71 1,323,786,748.56 1,271,363,320.01 1,203,414,498.27
Net profit attributable to the
-15,519,633.02 246,427,770.74 132,265,657.57 96,171,648.09
shareholders of the listed company
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
Net profit after deducting of
non-recurring gain/loss attributable
-22,412,384.48 187,920,405.28 111,826,970.81 95,362,911.27
to the shareholders of listed
company
Net Cash flow generated by
150,122,015.81 176,842,676.22 -117,174,042.01 244,625,950.67
business operation
Indicate by tick mark whether any of the financial data in the table above or their summations differs materially
from what have been disclosed in the Company’s quarterly or semi-annual reports.
□ Yes √ No
4.Share capital and shareholders
（1）Number of holders of ordinary shares and preference shares with restored voting right and Top 10
shareholders
In shares
Total
number of Total
common shareholders at Total
shareholders the end of the The total number of preferred shareh preferred shareholders at
at the end of 11,883 month from the 11421 olders voting rights restored at period 0 the end of the month from 0
the date of -end the date of disclosing the
disclosing the annual report
reporting
annual report
period
Shareholdings of Top 10 shareholders
Number or
share
Proportion Amount of pledged/froz
Shareholders Number of en
Nature of shareholder of shares shares held at restricted
held（%） period -end State
shares held of Amoun
shar t
e
Hangzhou Steam Turbine Power Group Co.,
State-owned legal person 63.64% 479,824,800 479,824,800
Ltd.
VANGUARD TOTAL INTERNATIONAL
Foreign legal person 1.96% 5,365,877 0
STOCK INDEX FUND
Zhou Jie Domestic Natural person 1.58% 4,341,100 0
China Merchants Securities(HK)Co., Ltd. State-owned legal person 1.50% 4,117,303 0
VANGUARD EMERGING MARKETS
Foreign legal person 1.45% 3,962,204 0
STOCK INDEX FUND
ISHARES CORE MSCI EMERGING
Foreign legal person 1.18% 3,231,301 0
MARKETS ETF
GUOTAI JUNAN
Foreign legal person 0.98% 2,679,711 0
SECURITIES(HONGKONG) LIMITED
NORGES BANK Foreign legal person 0.92% 2,514,529 0
Xia Zulin Domestic Natural person 0.85% 2,320,000 0
Gu Yang Domestic Natural person 0.55% 1,504,552 0
(1) Hangzhou Steam Turbine Power Group Co., Ltd. is the
holder of state-shares of the Company, all other
shareholders’ are holders of domestic listed foreign shares
(B shares)
Explanation on associated relationship among the aforesaid shareholders (2) There is no relationship between Hangzhou Steam
Turbine Power Group Co., Ltd. and other shareholders;
(3) Hangzhou Steam Turbine Power Group Co., Ltd. is
not an “action-in-concert” party with any of other
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
shareholders as described by the “Administration Rules of
Informational Disclosure about Change of Shareholding
Statues of PLCs”.
Notes to the shareholders involved in financing securities (if any) Not applicable
(2)Total preference shareholders and the shares held by the Top 10 Preference shareholders
□ Applicable √ Not applicable
None
(3)Block diagram of the ownership and control relations between the Company and the actual controller
5. Corporate Bonds
Indicate by tick market whether the Company has any corporate bonds publicly offered and listed on the stock
exchange, which were undue before the date of this Report’s approval or were due but could not be redeemed in
full.
No
III. Discussion and Analysis of the Management
1. Business Operation summary in the reporting period
The company carried out various management work based on the economic work policy of "winning the
relocation, intensively cultivating the market, developing enterprises by culture and striving for first-class". The
annual business performance showed a trend of low and then high, with the completion of various business
indicators better than expected, highlights in the driving market, fruitful achievements in scientific and
technological progress, successful completion of relocation, accelerated informatization construction and initial
improvement of management. During the reporting period, the company realized operating income of 4,496. 4452
million yuan, with a year-on-year increase of 5.06%; The total profit was 620.933 million yuan, with a
year-on-year increase of 30.07%; Net profit attributable to shareholders of listed companies was 459.3454
million yuan, with a year-on-year increase of 33.09%. The company's business objectives were achieved smoothly.
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
The main work carried out during the reporting period and the operating results obtained are as follows:
(I) Grasp the opportunity, intensively cultivate the market and occupy the driving commanding heights
During the reporting period, the refining and chemical market in the domestic driving sector continued, the
coal chemical industry market tended to recover, the competition in the traditional thermoelectric field in the
industrial power generation sector intensified, the development of the feed water pump market was still limited,
the overseas market share was limited, and the overall new orders received by the company rose steadily.
The company continued to seize the high-quality orders of domestic large-scale refining-chemical
integration and ethylene plant projects by virtue of its competitive advantages, and signed contracts for
Shenghong Petrochemical's 16 million tons/year refining-chemical integration project, PetroChina Jieyang's 20
million tons refining and 1.4 million tons ethylene project, Zhenhai Refining and Chemical's 1.2 million tons
ethylene project, CNOOC Huizhou Refining and Chemical Phase 2.5 project, and Sinopec Hainan Refining and
Chemical's 1 million tons ethylene and supporting refining units.
With the help of the recovery trend of coal chemical market, the company successfully signed a contract for
the steam turbine for phase I project of 1.8 million tons of ethylene glycol of Shaanxi Coal Group, and
successfully obtained the coal chemical projects such as Yulin Energy Ethylene Glycol and Ningxia Baofeng
Energy Coal-to-Olefin Phase III.
Competition in the power generation market is becoming more and more fierce, and orders in the traditional
thermoelectric field are declining. Although the market of feed water pump and induced draft fan has achieved
better results than in previous years, the market development space in this field is limited.
The company has deepened cooperation with Siemens in an all-round way, covering SGT-800, SGT-700,
SGT-300, SGT-2000E and other models, effectively improving the sales, design and after-sales service
management capabilities of gas turbines, and further expanding the market influence. In the field of gas turbine
market, the company signed contracts for CGNPC Wuhan Hanergy Distributed Energy Project and Anhui
Shanneng Fanchang Economic Development Zone Cogeneration Project.
(II) Continue to innovate, keep improving, and make break-through in new technological fields
The company continued to increase investment in research and development, independently innovated and
developed new products, and tackled key technical problems. During the reporting period, 33 scientific research
projects were established in the company's headquarters, including 9 new products and 24 scientific research
projects. 29 scientific research projects have been completed and accepted. Where, the project "Key Technology
and Application of High Efficiency and High Reliability Variable Speed Industrial Steam Turbine for Driving"
won the first prize of China Machinery Industry Science and Technology Award. The project "Industrial Steam
Turbine for Core Plant of Ultra-large Ethylene Project with an Annual Output of 1.2-1.5 million tons" was
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
selected as the first equipment engineering key project in Zhejiang Province in 2020. "1.5 million tons/year
Industrial Steam Turbine for Ethylene Plant Drive" won the first international product (set) in the key field of
equipment manufacturing industry in Zhejiang Province in 2020. The company won the honorary title of "Single
Champion Model Enterprise in Manufacturing Industry (Fifth Batch)" by Ministry of Industry and Information
Technology and China Federation of Industrial Economics.
The company completed the construction of the overall technical framework of the 100,000-class industrial
steam turbine, and formed a complete product map of the 120,000-kilowatt industrial-driven steam turbine. The
unit efficiency was steadily improved, and the models were more abundant. The successful development of Dalian
Hengli 1.5 million tons steam turbine for ethylene plant indicates that the company's products and technology
have reached the world leading level. The delivery of the first subcritical unit shows that the company's technical
design capability, material standard system and process manufacturing capability have entered a new level and
have been widely recognized by the market.
The company's "Industrial Internet Application Service Platform Construction Project" has been put into
trial operation. The company completed the docking of supply chain system and WMS system of stereo library,
continuously promoted MES system, promoted digital factory research and hybrid cloud project, and built a more
favorable platform for the company's intelligent manufacturing.
The company and its holding subsidiaries have obtained 3 invention patents, 38 utility model patents and 5
software copyrights. Where, the company's "Last Blade of Low Pressure Group of Large Flow Air-cooled Steam
Turbine" won the Chinese Patent Excellence Award for the first time. The company and its holding subsidiaries,
Hangzhou Zhongneng Steam Turbine Power Co., Ltd., Hangzhou Guoneng Steam Turbine Engineering Co., Ltd.,
Zhejiang Turbine Complete Technology Development Co., Ltd., Zhejiang Huayuan Steam Turbine Machinery Co.,
Ltd. and Hangzhou Turbine Casting Co., Ltd., have all been appraised as "high-tech enterprises".
(III) Relocate in an all-round way, ensure supply and win the tough battle of production
The main production workshops of the company, such as assembly workshop and rotor workshop, have been
successfully completed and accepted, and the steam turbine manufacturing base has already met the production
conditions. In November 2020, the company's production workshop, personnel and equipment were all moved to
Hangzhou Turbine Manufacturing Base, and the company's relocation work was successfully completed.
Affected by objective factors such as epidemic situation and relocation, the company faces many difficulties
such as shrinking production capacity and hindering the progress of outsourced processing. In the face of
difficulties, the company coordinated the production workshops to organize the division of labor, and created
favorable conditions for reducing the output backlog and realizing goods delivery through the close cooperation
and continuous production and overtime work of each production workshop. In order to ensure production
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
capacity, the company constantly improved supply chain management, developed supplier cooperation units,
strengthened communication and cooperation with suppliers, and ensured that the production and processing of
important products of the company were completed on time.
The company continuously optimized the production and process management processes, and further
strengthened the company's complete process capacity building. The painting workshop is stationed in Jingzi
Workshop to perform the functions of parts cleaning and primer application, and further improve the professional
management of production process. A distribution center is set up to perform digital management of all parts, so as
to realize the continuous change of intelligent factory. Through the integration of resources and process
reengineering, the production efficiency has been greatly improved.
(IV) Led by culture, driven by strategy, focus on transformation by management
The company started the construction of corporate culture in an all-round way, produced "Hangzhou
Turbine's Passionate Youth" by organizing a series of activities of "Corporate Culture Tour", and held the Artisan
Quality Month with the theme of "Artisan Spirit", which continuously promoted the deep integration of soft power
of corporate culture and hard power of corporate management, and formed a good atmosphere of "everyone
respects culture and lives in culture", which enabled the broad masses of cadres and employees to deeply
understand the core values of enterprises and effectively enhanced the cohesion, combat effectiveness and soft
power of the company.
The company promoted the strategic planning in an orderly manner, looked forward to the future market and
industry pattern by analyzing the changes of internal and external environment and combining with its own
business situation, and formulated the "Fourteenth Five-Year Plan" strategic plan and preliminary strategic
decomposition plan for Hangzhou Turbine in the new era.
During the reporting period, focusing on the "Top Ten Management Key Tasks", the company continuously
improved its management level, paid attention to relocation and construction to ensure production capacity,
focused on innovation promoted by orders, refined culture and educated talents, and prevented risks and
controlled quality. It continuously strengthened and improved property rights management, further standardized
the equity incentive mechanism of holding subsidiaries, and effectively motivated the management and technical
backbone of subsidiaries; optimized organizational adjustment and continuously promoted process integration and
lean production management; strengthened the construction of talents, and introduced high-level talents and
skilled personnel evaluation mechanism. Through a series of management work, the management level is
continuously improved.
During the reporting period, the company won the title of "National Excellent Quality Management Team of
Machinery Industry"; and successfully passed the "Made in Zhejiang" certification audit; The company's
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
"Dynamic Profit Management Model of Order-based Customized Manufacturing Enterprises" project won the
second prize of national enterprise management modernization innovation achievement and the first prize of
Zhejiang and Hangzhou enterprise management modernization innovation achievement.
2. Material Change to Main Business in Reporting Period
□ Yes √ No
3. Products Contributing over 10% of Main Business Revenue or Income
√ Applicable □ Not applicable
In RMB
Increase/decrease Increase/decrease Increase/decrease
of revenue in the of business cost of gross profit
Gross profit
Name Turnover Operation cost same period of over the same rate over the same
rate(%)
the previous period of period of the
year(%) previous year (%) previous year (%)
Industrial steam
3,389,671,162.40 1,032,790,913.52 30.47% -0.08% 1.49% 0.47%
turbine
4. Whether the characteristics of management seasonal or cyclical need special attention
□ Yes √ No
5. Material difference of revenue, operating costs or net profit attributable to holders of ordinary shares of
the Company for the reporting period from the last reporting period
□ Applicable √ Not applicable
6. Suspension in trading or delisting
□ Applicable √ Not applicable
7. Events relating to the financial report
(1) Reason for changes in accounting policies, accounting estimates and accounting methods as compared
to the financial report for the prior year
√ Applicable □ Not applicable
1. The company will, since January 1, 2020, implement the "Accounting Standards for Business Enterprises No.
14-Revenue" revised by the Ministry of Finance (hereinafter referred to as the new revenue standards). In
accordance with relevant regulations for convergence of the old and new standards, the comparable period
information is not adjusted, and the cumulative impact from new standards on the first implementation date is
retrospectively adjusted to the amount of retained earnings and other related items in the financial statements at
the beginning of the reporting period.
The main impacts of implementing the new income standards on the financial statements of the company on
January 1, 2020 are as follows:
Items Balance sheet
Adjustment impact of new
December 31,2019 January 1,2020
income standards
Account receivable 2,025,081,342.74 -545,043,494.83 1,480,037,847.91
Contract assets 545,043,494.83 545,043,494.83
Reeceived in advance 2,818,130,397.17 -2,818,130,397.17
Contract liabilities 2,496,129,669.77 2,496,129,669.77
Other current liabilities 322,000,727.40 322,000,727.40
2. Since January 1, 2020, the company has implemented the Interpretation of Accounting Standards for Business
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Hangzhou Steam Turbine Co., Ltd. Summary of 2020 Annual Report
Enterprises No.13 promulgated by the Ministry of Finance in 2019, and this accounting policy change is handled
by the future applicable law.
(2) Reason for retrospective restatement to correct major accounting errors during the reporting period
□ Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in the
period.
(3) Reason for changes in scope of the consolidated financial statements as compared to the financial report
for the prior year
√Applicable□ Not applicable
Reduced scope of consolidation：
Equity disposal Net assets on disposal Net profit from opening
Name Equity disposal point
method date to disposal date
Hangzhou Kaineng Forging Co.,
Withdraw April 15,2020 3,223,519.61 -716.40
Ltd.
Hangzhou Steam Turbine Co., Ltd.
Chairman of the Board: Zheng Bin
April 17, 2021
11
