Stock Code: 200771 Stock ID: Hangqilun B Announcement No.: 2022-20
Hangzhou Steam Turbine Co., Ltd.
Board of Directors Reports in 2021
The members of the Board and the Company acknowledge being responsible for the truthfulness,
accuracy, and completeness of the announcement. Not any false record, misleading statement or
significant omission carried in this announcement.
In 2021, in strict accordance with laws and regulations such as the Company Law, Securities
Law, Stock Listing Rules of Shenzhen Stock Exchange, and Guidelines for Standardized Operation
of Listed Companies of Shenzhen Stock Exchange, as well as the Articles of Association, the Board
of Directors of the company is responsible to all shareholders, diligently and effectively exercising its
functions and powers, conscientiously implementing the resolutions of the shareholders' meeting,
diligently carrying out all the work of the Board of Directors, and promoting the improvement of
corporate governance and the development of all business operations of the company. The main work
of the Board of Directors in 2021 is reported as follows:
I. Business operations of the company in 2021
In 2021, the annual operating income was RMB 5,788,288,600, the total profit was RMB
832,547,500 and the net profit was RMB 727,247,800, of which the net profit attributable to
shareholders of listed companies was RMB 649,992,500. Compared with the same period of last year,
the operating income increased by 21.54%, the total profit increased by 25.93%, the net profit
increased by 25.49% and the net profit attributable to shareholders of listed companies increased by
36.48%. The main work carried out during the reporting period and the operating results obtained are
as follows:
1. Focus on market
During the reporting period, in the face of the severe market situation and fierce competition
pattern under the "double carbon" policy, the Company stabilized the industry-driven market by
strengthening "sales around the front" and deepening the plate linkage mechanism. Its typical projects
included 7 sets of units in Ningxia Baofeng Phase III coal-to-methanol project, caprolactam project of
Sinopec Baling Petrochemical Company and the oil refining to chemical supporting project of Sinopec
Anqing Petrochemical. By seizing the investment opportunity of thermal power generation, it strove to
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compete for the industrial power generation market, and the contract undertaking in the power
generation field increased compared with the same period of last year, and it was successively awarded
with the Smart Energy Center Project of Yiwu High-tech Zone of BR Energy, the 50MW Back
Pressure Power Generation Project of Jiahua Energy, the Low-voltage Waste Heat Power Generation
Project of Pengwei Petrochemical, etc. By accurately predicting the industry background of "refining
control and chemical increase", it found out the development direction of new material market and
opened up new markets. It gained gradual improvement in gas turbine market, and it successfully
signed contract on Huadian Jiangdu Natural Gas Distributed Energy Project, Haining Guangyao
Natural Gas Distributed Energy Project and Asia Symbol Paper Self-provided Power Station Project,
etc.
2. Digital empowerment
During the reporting period, the Company continued to promote intelligent construction and
digital transformation of the enterprise, continuously optimized MES system to help refine production
management, promoted ERP construction in an all-round way, determined the ERP selection scheme
according to the Company's "tailor-made" single piece and small batch production characteristics,
completed the blueprint of digital factory construction in manufacturing base, completed the
preliminary scheme of digital factory construction, put the industrial internet platform and service
management platform into trial operation, fully put the new OA system into use, put the system flow
and management platform online on a large scale, continuously optimized the rapid collaborative
development platform (BCP) with independent intellectual property rights, and deeply integrated with
OA to realize the integration of office flow and business flow.
3. Transformation and upgrading
During the reporting period, the implementation of the Company's "Key Account Management
System Based on Equipment Lifecycle Management" achieved a series of achievements, and it
successively renewed the strategic cooperation agreement with Shenyang Blower, signed the strategic
and long-term cooperation agreement with Hengli Petrochemical, further consolidated the relationship
with various engineering general contracting companies, preliminarily established the key account
training system, and obtained good market feedback for the first round of customer training. In order to
realize the transition to service-oriented manufacturing and build the development direction of "big
service", during the reporting period, the Company completed the construction of "two-line" service
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team, focusing on breaking through modules such as "O&M training, technical training, inspection and
diagnosis". It established Hangzhou Steam Turbine New Energy Co., Ltd., and set up the "Hangzhou
Steam Turbine and Siemens Energy Joint Technology Center" in cooperation with Siemens Energy,
which marks its comprehensive engagement in the field of distributed energy, thermoelectric
transformation and new energy.
4. Strengthen enterprise with talents
During the reporting period, the Company promoted the implementation of the human resources
promotion project from three aspects: strengthening the human resources foundation, improving the
efficiency of human resources management and optimizing the human resources management
mechanism. It gradually established a performance-oriented talent evaluation model, strove to build a
human resource management system based on value creation, completed the evaluation work of eight
"company-level skill master studios" such as "Leaf Installation Skill Master Studio", and fully utilized
the positive role of high-skilled talents in technological innovation, skill inheritance and grass-roots
management; successfully implemented the equity incentive plan, formulated performance appraisal
methods for the implementation of equity incentive targets, further established and improved the
long-term incentive mechanism, and attracted and retained outstanding talents.
5. High quality development
During the reporting period, the Company accelerated scientific research and achieved fruitful
product development. The Company emphasized product efficiency improvement, parameter
improvement, technology update and product development, and focused on difficult projects in the
fields of large air separation, large ethylene, subcritical, high back pressure and low-pressure waste
heat utilization, etc., and accepted 29 key research projects and completed the approval of 38 new
product development and key research projects, including 15 new products, creating a record high. The
Company's two projects, namely "R&D and Application of Steam Turbine for Nuclear Island
Emergency Auxiliary Feed Water Pump" and "Low-quality Energy Efficient Utilization Technology
and Application", won the first prize of Zhejiang Machinery Industry Federation's 2021 Science and
Technology Award; "R&D and Application of Key Technologies for Efficient and Reliable Blades of
Industrial Steam Turbines" won the first prize of Provincial Scientific and Technological Progress;
"The Last Blade of Low-pressure Stage Group of Large-flow Air-cooled Steam Turbine" won the
China Patent Excellence Award.
II. Performance of the Board of Directors according to law during the reporting period
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(I) Perform work duties according to law and improve the level of scientific decision-making
1. About Board Meetings
In 2021, a total of 12 Board meetings. The Board of Directors of the Company deliberates
important transactions such as related party transactions, entrusted financial management, investment,
guarantee, asset disposal, equity acquisition, absorption and merger of subsidiaries, etc., and carries out
decision-making approval on corporate governance matters such as institutional adjustment,
appointment of managers, supplement of directors, write-off of assets impairment, change of
accounting policies, profit distribution, executive compensation, equity incentives, renewal of
accounting firms, and amendment of articles of association.
2. Information about the Independent Directors' Duty Performance
Independent directors of the company attended relevant meetings in strict accordance with the
Company Law, Guidelines for Standardized Operation of Listed Companies of Shenzhen Stock
Exchange, Guiding Opinions on Establishing Independent Director System in Listed Companies and
other relevant laws and regulations, carefully reviewed all proposals of the Board of Directors,
diligently and responsibly expressed independent opinions, and fully played the role of independent
directors. For details of performance of duties, please refer to the Debriefing Report of Independent
Directors of the Company.
3.Information about the Duty Performance of Special Committees
The Board of Directors shall set up special committees such as audit, remuneration, strategy and
nomination. During the reporting period, the Company organized 9 special committees of the Board of
Directors. The Audit Committee has played a professional role in communicating with independent
directors and audit institutions and deliberating the Company's periodic reports and major financial
matters; According to the Company's remuneration assessment methods and assessment settlement,
the Remuneration and Assessment Committee put forward specific remuneration schemes that were
beneficial to long-term incentives for the Company's directors and executives, and reviewed the draft
equity incentive plan and equity incentive management measures drawn up by the Company; The
Strategy Committee fully discussed the Outline of the 14th Five-Year Development Strategic Plan; The
Nomination Committee strictly examined the qualifications and procedures of the candidates to be
appointed as executives and directors.
（II）Continuously improve the corporate governance system and ensure the company’s compliance
in operation
1. Revise the Remuneration Management System for Directors and Senior Managers, and form a
long-term incentive and restraint mechanism for the remuneration assessment of directors and senior
managers of the Company in combination with the remuneration level of the same industry and the
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requirements of state-owned asset supervision. Formulate the draft equity incentive and equity
incentive assessment method, implement restricted stock incentives for directors, senior executives,
other leaders and backbones of the Company for the first time, and form the long-term performance
assessment mechanism of the Company together with remuneration assessment, effectively combining
the interests of shareholders, the interests of the Company and the personal interests of the core team,
so that all parties can pay attention to the long-term development of the Company together.
2. Amend the Articles of Association and adjust the number of Board of Directors, Board of
Supervisors and vice chairmen. Adjust the personnel of special committees of the Board of Directors to
further improve the corporate governance structure. According to the special governance requirements
of listed companies, ensure the independence of the Company in assets, finance, institutions and
business, and conduct self-examination on important matters such as related party transactions, related
party capital exchanges, external guarantees, internal control construction, information disclosure
management, insider information management, and commitments of controlling shareholders, so as to
ensure the standard operation of corporate governance.
(III) Strengthen the management of information disclosure and well ensure the control of insider
information circulation
In 2021, the company issued a total of 121 announcements, The information disclosure is true,
accurate, complete, timely and fair, and the listed company's information disclosure obligations are
fulfilled in compliance. Strengthen active information disclosure, ensure that investors are aware of the
major issues of the Company in time, and guarantee investors' right to be informed to the greatest
extent.
The Board of Directors has formulated and effectively implemented the insider information
management system, defined the scope of insiders of insider information, and strengthened the
accountability for insider information disclosure. Directors, supervisors, senior managers and
information disclosure related staff of the Company strictly abide by the system requirements and
control the transmission range of inside information in the actual work. The Company has strictly
registered and managed insiders of inside information, reminded relevant personnel in writing to keep
confidential and signed confidentiality commitments, and continuously strengthened the work of
keeping confidential the insider information.
(IV) Strengthen the management of investor relations and earnestly protect the rights and interests of
investors
The company provided a convenient communication platform for investors and answered
investors' questions on the "Interaction Platform" of Shenzhen Stock Exchange. It paid attention to
public opinion monitoring, acquired the reports and evaluations of investors, capital markets and
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media on the company, and actively fed back investors' attention to the company. The company held
online collective reception day activity for investors to establish a good interactive relationship with
investors. The Company has held online investor performance briefing and investor reception day
activities, explained the Company's periodic reports and investors' concerns, and established a good
interactive relationship with investors.
(V) Effectively implement the resolutions of the shareholders' meeting and implement a prudent
dividend policy
In 2021, the Board of Directors of the company convened 5 general meetings of shareholders,
Review the Company's major business decisions and major governance issues. The Board of Directors
timely implemented the resolutions of the General Meeting of Shareholders, and completed all work
authorized by the General Meeting of Shareholders.
The Company's profit distribution policy has maintained its continuity and stability. In 2021, it
implemented the 2020 profit distribution plan and distributed RMB 184 million to all shareholders. In
2021, it is planned to distribute RMB 302 million to all shareholders in cash, and distribute 3 shares for
every 10 shares with undistributed profits.
III. Development prospect
(I) Development strategy and business plan for 2022
2022 is a crucial year for the Company to promote the reform of state-owned enterprises and
implement the "14th Five-Year Plan", and it is a vital year as a link between past and future and the
future and to achieve high-efficiency and high-quality development. In 2022, the Company will further
consolidate the market, steadily promote business transformation and resource integration, accelerate
innovative development and digital transformation, and strive to promote the high-quality
development of the enterprise.
1. Consolidate the market
Strengthen the joint sales of drive power generation, realize the complementation and sharing of
market resources, strengthen the promotion of thermal power market, compete for the contract orders
of small and medium-sized drives, expand new fields such as waste heat power generation, tap the
potential demand of thermal power and coal chemical industry market, and progress on the road of
coordinated development of traditional plate and new energy plate.
Pay attention to the evolution direction of environmental protection policy and the trend of
energy market, seize the window period of carbon reduction and emission decrease in stock market,
and actively expand the market of complete works and services. Focus on the quality of contract
performance, speed up inventory clearing, strengthen the dynamic control of production and sales
linkage, ensure the stability of sales revenue, and lay a solid foundation for the Company's "14th
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Five-Year Plan" development.
2. Digital leading
Deepen data thinking, realize traditional business datamation, and make data the core resource
and asset of enterprises. Promote the hardware guarantee, transformation and upgrading of the
Company's PLM, MES, CRM, SRM and other information systems. Well ensure ERP project
implementation, accelerate ERP application integration, promote enterprise management innovation,
and cultivate the Company's own ERP O&M team. Build a production control system, realize
digitalization and visualization of the whole process, carry out emerging projects such as quality
traceability and 5G+ technology, improve the inter-departmental administrative efficiency of the
enterprise and reduce operating costs.
Continue to promote the protection capability of information security system and the guarantee
of information infrastructure construction, and realize the general trend of O&M technology
intelligence. Complete the selection and application of the Company's cloud design platform, explore
the application of the industrial Internet to effectively reduce costs and increase efficiency, and speed
up the challenge of digital visualization with high requirements in industrial field. Accelerate the pace
of intelligent manufacturing, continue to well ensure the wide application of rotor intelligent
manufacturing, explore intelligent manufacturing schemes for blades, shell parts and toxic and harmful
types of work, and promote the construction of intelligent factories.
3. Format transformation
Further promote the implementation of the key account management system and major service
framework. With the development of stock market and the expansion of new energy business as
carriers, improve the quality of full-cycle technical service of core users. Relying on the construction
of "Joint Development Center for Innovation and Efficiency Technology of Petrochemical Rotating
Equipment", improve the enterprise-level database, formulate an efficient inspection mechanism,
optimize the online diagnosis system, strengthen the data analysis function, provide targeted and
personalized aggregation services for core users, effectively promote the digital empowerment of
marketing business and promote the process of business integration.
Explore the low-carbon blue ocean market and add green power. Make good use of the
diversified development of new energy company design and general contracting qualification, and
gradually expand to EPC, so as to further enrich the product line. Extend the after-sales service
business from single product service to diversified product set growth service, increase the added value
of products and services, create value for customers, and well build an ecosystem for O&M services.
4. Innovative development
Take design cost reduction as the major technical development direction in the future. Promote
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systematic, integrated and complete R&D mode to meet personalized market demand, seize the market
opportunities of large air separation unit and large ethylene unit, attach importance to the market of
thermoelectric transformation, optimize the efficiency of back pressure generator unit, expand the
high-efficiency utilization technology and application demonstration for low-quality energy, and well
ensure technology promotion and unit development for low-pressure ultra-low-pressure waste heat
steam utilization, as well as the coverage of practical application stage.
Continue to promote the development of supercritical carbon dioxide prototype, and promote the
upgrade of steam turbine unit container 2.0. Improve the digital delivery capacity building, carry out
the three-dimensional layout pilot, and complete the version change and update of the random data.
Complete implementation verification of technical improvement with low vibration index and
CNAS certification of physical and chemical laboratory. Continuously optimize and improve the
control measures of self-inspection and quality spot check in the processing and assembly stages,
ensure the closed-loop verification of quality problems, strictly implement the quality assessment
system, and help the manufacturing capacity to step up.
The Board of Directors of the company will continue to fulfill its information disclosure
obligations in strict accordance with the Company Law, Securities Law, Stock Listing Rules of
Shenzhen Stock Exchange, Guidelines for Standardized Operation of Listed Companies of Shenzhen
Stock Exchange and the Articles of Association, and effectively improve the standard operation level
of the company.
It will constantly strengthen the construction of investor relations management, promote the
company to maintain a good interactive relationship with investors, earnestly protect the investors'
participation rights, protect investors' legitimate rights and interests, improve corporate governance,
build market consensus, and establish a good image of the capital market.
The Board of Directors of the company will continue to work honestly, diligently, actively and
solidly, maintain its determination, focus on its core business, and promote the high-quality
development of the enterprise, so as to safeguard shareholders' interests, enhance investors'
confidence and provide a strong guarantee for the sustainable and healthy development of the
company!
The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
.
March 31,2022
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