| Stock code: 000488, 200488 | Stock abbreviation: Chenming Paper Chenming B | Announcement No.: 2024-024 |
2023 Annual Report Summary ofShandong Chenming Paper Holdings Limited
I. IMPORTANT NOTICEThis annual report summary is extracted from the text of the annual report. For the full understanding of the operating results,financial position and plan for further development, investors should carefully read the text of the annual report published on themedia as designated by the CSRC.All directors have attended the board meeting to review this report.Notice of non-standard auditor’s opinion
□ Applicable ? Not applicable
A proposed profit distribution plan or a proposed plan on conversion of capital reserves into share capital for the reporting periodwas considered and passed by the Board
□ Applicable ? Not applicable
The Company proposes not to distribute cash dividend, issue bonus share, or capitalise from capital reservesA proposed profit distribution plan on preference shares for the reporting period was considered and approved by the Board
□ Applicable ? Not applicable
II. BASIC INFORMATION ABOUT THE COMPANY
1. Company profile
| Stock abbreviation | 晨鸣纸业 | Stock code | 000488 |
| 晨鸣B | 200488 | ||
| Stock exchange on which the shares are listed | Shenzhen Stock Exchange | ||
| Stock abbreviation | CHENMING PAPER | Stock code | 01812 |
| Stock exchange on which the shares are listed | The Stock Exchange of Hong Kong Limited | ||
| Stock abbreviation before the change (if any) | Nil | ||
| Contact persons and contact methods | Secretary to the Board | Hong Kong Company Secretary | |
| Name | Yuan Xikun | Chu Hon Leung | |
| Correspondence address | No. 2199 East Nongsheng Road, Shouguang City, Shandong Province | 22nd Floor, World Wide House, Central, Hong Kong | |
| Facsimile | 0536-2158977 | 00852-21629600 | |
| Telephone | 0536-2158008 | 00852-25010028 | |
| Email address | chenmmingpaper@163.com | liamchu@li-partners.com | |
2. Overview of principle activities or products during the reporting period
(1) Industry Situation of the Company
The industry in which the Company operates is paper making and paper product industry.As an important basic raw material industry, the paper industry plays an important role in various fields of the national economy.After nearly 30 years of accelerated progress, China’s paper industry has made remarkable results and achieved landmarkdevelopment, but is also facing new challenges in its new journey.
During the reporting period, the overall profitability of the paper industry improved but its momentum was slightly weaker due
to the sluggish downstream demand, raw material price fluctuation, increased supply and other factors. According to the data of theMinistry of Industry and Information Technology, from January to December 2023, revenue of papermaking and paper productenterprises above designated size was RMB1,392.62 billion, down 2.4% year on year; their operating costs were RMB1,222.80billion, down 3.1% year on year; and their total profit was RMB50.84 billion, up 4.4% year on yearOn the supply side, the domestic and overseas supply growth had a great effect on paper price fluctuation. Domestically,newpaper production capacity in China had been drastically high in the past two years. Overseas, the import volume of machine-madepaper and paperboard increased year on year as a result of the “zero tariff” policy. The domestic and overseas factors boosted themachine-made paper supply. According to the data of the National Bureau of Statistics, the national output of machine-made paperand paperboard was 144,055,300 tonnes from January to December, 2023, which exceeded the 140 million tonnes mark for the firsttime and reached a record high.
During the reporting period, the prices of cultural paper and white cardboard prices were mixed. In terms of price, the whitecardboard price rebounded slightly in October and November, and showed an overall fluctuating downward trend. The cultural paperprice had a “V”-shaped trend that fluctuated downward in the first half of the year and floated upward in the second half.
In terms of cost, the paper raw material prices and energy prices had fluctuated downward since 2023. However, due to a higherprice base and the cost transmission delay, the paper enterprise production cost was still at a high level in 2023. Coupled with theweak product demand, enterprises faced a greater pressure to realise profit.
In the short term, the paper product prices still face some upside resistance under the sufficient supply. However, the fiercecompetition will prompt leading enterprises to exploit the scale and cost advantages, and will facilitate the liquidation of small andmedium-sized enterprises to improve the industry operational efficiency, thus further enhancing the industry concentration. In thelong run, China’s paper industry concentration is still at a low level. The data shows that the CR10 in China’s paper industryremained at about 45% in 2022, compared with about 90% for the CR10 in the United States, which means much room forimprovement.
(2) Products of the Company
The Company is a large modern conglomerate principally engaged in pulp production and paper making and committed itself toimplementing a pulp and paper integration strategy. At present, the Company has production bases in Shandong,Guangdong, Hubei,Jiangxi, Jilin and other places, with annual pulp and paper production capacity of 11 million tonnes, including pulp productioncapacity of 4.3 million tonnes. It is the first domestic paper making enterprise that achieves a balance between pulp production andpaper making capacity in general. During the reporting period, the Company realized revenue of RMB26,609 million. The machine-made paper business is the major source of revenue of the Company. There was no significant change in the principal activity and thebusiness model of the Company.
As a leading player in the domestic paper making industry in China, the Company attaches great importance to technologyresearch and development and brand benefits. The Company has research institutions such as a national enterprise technology centre,a post-doctoral working station, a collaborative innovation center for cleaner production and refinery of light industry bio-basedproducts, the Shandong Pulp and Paper Making Engineering Lab and the Guangdong Pulp and Paper Production TechnologyResearch Centre. It has introduced internationally advanced pulp and paper production technologies and equipment for theproduction of machine-made paper products covering more than 200 types in seven series, including culture paper, coated paper,white cardboard, copy paper, industrial paper, special paper, and household paper. The Company owns “CHENMING CLOUDYMIRROR”, “CHENMING CLOUDLY LION”, “CHENMING SNOW SHARK”, “CHENMING EAGLE”, “CHENMINGGONGHAO”, “XINGZHILIAN” and other famous brands, with each major product ranking among the highest in terms of marketshare in China. It is the enterprise with the largest variety of products and the most complete products in the domestic paper makingindustry.
During the reporting period, the 70g and 80g CLOUDY MIRROR, and CLOUDY LEOPARD electrostatic copy paper of theCompany were successfully selected as the 2023 “Made in Shandong·? Qilu Premium Products”. The “embossed premium napkin”and the “high grade coated paper surface enhancement technology development” were awarded 2023 Shandong Province TechnologyInnovation Awards. As one of the brands which were selected as the first 223 “Shandong’s Good Product” brands, the Company wasawarded the “Shandong’s Good Product” logo authorisation. Customers recognised the product quality of the Company. TheCompany built up strategic cooperation relationship with famous companies such as Daehan Paper, CellMark AB in Sweden, andDeli Group.
| Category | Major brands and types | Major manufacturing companies | Range of application |
| Culture paper series | 1. “BIYUNTIAN”, “CLOUDY MIRROR”, “CLOUDY LEOPARD” and “YUNJIN” all-wood pulp offset paper and electrostatic base paper 2. “CLOUDY LION” and “CLOUDY CRANE” original white offset paper 3. “CLOUDY PINE” and “GREEN PINE” light weight paper 4. Blueprint paper, colour offset paper, pure texture paper, non-fluorescent offset paper, PE offset paper 5. Beige and high white book paper 6. Light weight coated paper | Shouguang Headquarters Shouguang Meilun Zhanjiang Chenming Jiangxi Chenming Jilin Chenming | Printing publications, textbooks, magazines, covers, illustrations, notebooks, test papers, teaching materials, reference books, etc. |
| Coated paper series | 1. “SNOW SHARK” and “EAGLE” one-sided coated paper 2. “SNOW SHARK”, “EAGLE” and “RABBIT” double-sided coated paper 3. “EAGLE” and “RABBIT” matte coated paper | Shouguang Headquarters Shouguang Meilun | Double-sided coated paper is suitable for high quality printing, such as high-grade picture albums, picture, magazines and so on, promotional materials such as interior pages of high-end books, wall calendars, posters and so on, and suitable for suitable for high-speed sheet printing and high-speed rotary printing; One-sided coated paper is suitable for upscale tobacco package paper, adhesive sticker, shopping bags, slipcases, envelopes, gift wrapping and so on, and suitable for large format printing and commercial printing. |
| White | 1. White cardboard of “LIYA” series, white cardboard and ivory | Shouguang | High-end gift boxes, cosmetics boxes, tags, |
| cardboard series | cardboard of “LIPIN” and “POPLAR” series, high bulk cardboard and ivory cardboard of “LIZZY” and “BAIYU” series, and super high bulk cardboard of “LIYING” and “BAIYU” series 2. Food package board of “LIYA” and “LIZZY” series 3. Coated cattle card and LIYA book card 4. Playcard paper board 5. Chenming cigarette cardboard | Headquarters Jiangxi Chenming Zhanjiang Chenming | shopping bags, publicity pamphlets, high-end postcards; cigarette package printing of medium and high quality; milk package, beverage package, disposable paper cups, milk tea cups, and noodle bowls. |
| Copy paper series | “GOLDEN MINGYANG” and “GOLDEN CHENMING” copy paper, “BOYA” and “BIYUNTIAN” copy paper, “MINGYANG”, “LUCKY CLOUDS”, “BOYANG” and “SHANYIN” copy paper, and “GONGHAO” and “TIANJIAN” copy paper | Shouguang Headquarters Shouguang Meilun Zhanjiang Chenming | Printing and copying business documents, training materials, and writing. |
| Industrial paper series | High-grade yellow anti-sticking base paper, ordinary yellow/white anti-sticking base paper and PE paper | Shouguang Headquarters Jiangxi Chenming Zhanjiang Chenming | Anti-stick base paper is mainly used for producing the paper base of stripping paper or anti-sticking base paper; Cast coated base paper is suitable for producing adhesive paper or playcard compound paper after coating. |
| Special paper series | Thermal paper and glassine paper | Shouguang Art Paper | High-grade adhesive backing paper for electronics, medicine, food, washing supplies, supermarket labels, double-sided tapes, etc. |
| Household paper series | Toilet paper, facial tissue, pocket tissue, napkin, paper towels and “XINGZHILIAN” | Shouguang Meilun | Daily toilet supplies; used in restaurants and other catering industries, and used in public toilets in hotels, guesthouses, and office buildings, and also suitable for home and other environment. |
(3) Operation model of the Company
① Purchase model
The Company has established a supply chain management centre which adopts a supply chain management model of“centralised procurement by the Group, source as the first priority, hierarchical separation and one-vote veto”. Through continuousimprovement of the procurement information system, the Company has fully realised machine control management, and optimisedthe authorisation approval process, effectively standardising the procurement management system. Based on the needs ofproduction bases, the Group integrates the resources of related parties and implements centralised procurement. The Companyseeks sources and high-quality suppliers through industry exhibitions, on-site inspections and competitive factory research tostrengthen procurement at source and reduce procurement costs; and introduces a supplier competition mechanism by establishinga three-level joint review mechanism for suppliers and implementing a system of eliminating substandard suppliers, so as toimprove supply quality. Meanwhile, the Company actively cooperates with financial institutions and third parties in the supplychain financial business, and fully utilises the funds from contributing parties to lower procurement costs, deepen strategiccooperation and enhance supply chain competitiveness.
② Production model
The Company has committed itself to implementing a pulp and paper integration strategy. Adhering to the concept of“placing green development and environmental protection as its priority”, the Company has actively promoted clean productionand vigorously carried out energy conservation and emission reduction, aiming to be a resource-saving and environmentallyfriendly model enterprise. It is innovating an integrated use of resources and a circular industrial development mode, and an“ecological chain” featuring resources, products and recycled resources has been established. As for production process, theCompany takes planned management as the focus and implements a hierarchical planned management model for the Group, theCompany, factories and workshops. Its production volume is determined based on the sales, its production is arrangedscientifically, and its inventories are under strict control. The Group has set up a production scheduling centre to monitor theoperation of the production lines of each subsidiary around the clock on a real-time basis, so as to ensure normal production. It hasactively built and promoted the MES management system, and realised the timely information transfer between the managementand the production control unit through bridging the gap between the ERP and DCS systems.
③ Marketing model
The Company has always adhered to the marketing concept of “Good faith, Win-Win and Sharing” while wholeheartedlyserving its customers. The Company has a relatively mature sales network, and has set up specialised sales companies responsiblefor the development of domestic and overseas markets, product sales, and formulation of sales policies. The sales companies’management systems are divided into product lines, product companies, management areas, and branches to achieve matrixmanagement. The sales companies are divided into product companies of culture paper series, coated paper series, white cardboardseries, electrostatic paper series, special paper series and household paper series according to product line. Each product companyhas its administrative district. A regional general manager is responsible for his/her administrative district, under which branchcompanies are set up. The chief representatives of the branch companies have full authority to deal with branch business.
The Company has implemented a three-level scheduling mechanism. Branch companies, administrative districts, and salescompanies schedule task indicators daily to ensure the effective implementation of the plans. It sticks to a “four-level visitmechanism” to gain deep market insights and meet customer needs. Meanwhile, by leveraging its comprehensive informationsystems, the Company has realised It-based management. It has also established and improved the complaint handling system andcustomer satisfaction system to enhance the Company’s marketing management level.
④ R&D model
The Company is market-oriented, and innovation is it driving force. It highly values technological R&D, and has formed avariety of R&D modes such as independent R&D, technology introduction, and industry university research cooperation. Atpresent, the Company has a number of domestically leading innovative R&D platforms, including a national enterprise technologycentre, a post-doctoral working station, a collaborative innovation center for cleaner production and refinery of light industry bio-based products, Shandong Pulp and Paper Making Engineering Lab and the Guangdong Pulp and Paper Production TechnologyResearch Centre, which have enhanced its independent innovation capabilities. Meanwhile, on the basis of introducinginternationally advanced pulp and paper production lines and advanced technologies, the Company has made technological
improvements and re-innovations, and established new standards for processes and product quality, forming distinctive coretechnologies. The Company also works hard on the following aspects: carrying out academic research with colleges anduniversities and R&D institutions such as Qilu University of Technology, Qingdao University of Science and Technology, TianjinUniversity of Science and Technology, and Institute of Chemical Industry of Forest Products of the Chinese Academy of Forestry,introducing, digesting and absorbing scientific research and innovation achievements, accelerating the industrialisation of new andhigh technologies, optimising product mix, and improving the competitiveness of its products in the market.
(4) Analysis of Core Competitiveness
After innovation and development for more than 60 years, the Company has created a strong brand influence and cultivated asolid comprehensive competitiveness. It promotes product upgrades, enhances R&D strength and improves core competitivenessby creating competitive advantages in industry chain featured with pulp and paper integration. The core competitiveness of theCompany did not underwent major changes during the reporting period. The details of the core competitiveness of the Companyare as follows:
① Advantages of pulp and paper integration
The Company has unwaveringly implemented a pulp and paper integration strategy. At present, its major production baseslocated in Shouguang, Zhanjiang, and Huanggang are equipped with chemical pulp production lines, with total productioncapacity of wood pulp reaching 4.30 million tonnes. It is the first modern large-scale paper making company that basically realiseswood pulp self-sufficiency in China. A complete supply chain not only creates cost advantage for the Company, but alsosafeguards the safety, stability and quality of upstream raw materials, and renders strong support for the Company to maintain itslong-term competitiveness.
② Scale advantages
The paper making industry is a typical capital-intensive and technology-intensive industry that follows the laws of economiesof scale. The Company is a leading player in the paper making industry in China. Its large-scale production bases can be found inthe major markets in Southern, Central, Northern, and Northeast China, with annual pulp and paper production capacity reaching11 million tonnes, where reasonable production scale creates the marginal cost advantage. Meanwhile, by leveraging the scaleadvantages, the Company has built an international logistics centre and railway dedicated lines and docks, and constructed acomprehensive logistics service platform covering container shipping, bonded warehousing, transfer and storage at stations andterminals, realising the improvement of logistics efficiency and the stability of logistics costs.
③ Product advantages
The Company is an enterprise that offers the widest and the most complete product range in the paper making industry inChina. The product series include culture paper, white cardboard, coated paper, copy paper, household paper, thermal paper, etc.,with each major product ranking among the best in terms of market share. The Company has attached great importance totechnology research and development. By introducing the most advanced pulping and paper making technology and equipment inthe world, it persists in technological innovation and work process optimisation, so as to help improve product quality andstructure upgrade, continuously improve the brand value of Chenming, and enhance brand benefits.
④ Industry layout advantages
Closely centring on the pulp and paper integration strategy, the Company has integrated resources and established itsproduction bases in the core target market to promote the coordinated development of all regions. Currently, the Company adoptsthe market-oriented approach and has production bases in Shandong, Guangdong, Hubei, Jiangxi, Jilin and other places. With allproducts sold at close distances, the Company substantially reduces transportation costs while improving service efficiency,achieving a “win-win” between the Company and its users.
⑤ Advantages in technical equipment
The Company highly values the introduction and upgrades of technical equipment, actively push equipment and technologyupgrade forward and boasts the largest and most advanced pulping and paper making production line in the world. The Company’smajor production equipment has been imported from internationally renowned manufacturers, including Metso and Valmet ofFinland, Voith of Germany, Andritz of Austria, etc. and reached the advanced international level, thus ensuring productionefficiency and product quality.
⑥ Advantages in research and innovation
The Company has scientific research institutions including a national enterprise technology centre, a post-doctoral workingstation, and a collaborative innovation center for cleaner production and refinery of light industry bio-based products. At the sametime, the Company actively carries out in-depth industry-university-research cooperation with prestigious domestic universitiesand research institutes, continuously improves technical innovation capabilities and scientific research and development levels,and develops a series of new products with high technology contents and high added value as well as proprietary technologies. TheCompany and its subsidiaries Zhanjiang Chenming, Shouguang Meilun, Jiangxi Chenming, Jilin Chenming and HuanggangChenming are high and new technology enterprises. As at the end of the reporting period, the Company had obtained over 400national patents, including 41 invention patents, 7 national new products, 16 scientific and technological progress awards abovethe provincial level, 5 national scientific and technological projects and 75 provincial technological innovation projects. TheCompany took the lead in obtaining the ISO9001 quality system certification, the ISO14001 environmental protection systemcertification and the FSC-COC international forest system certification among domestic peers.
⑦ Team management advantages
The Company possesses a complete and reasonable talent structure consisting of experienced personnel, including high-endtalents specialising in production, technology, sales, finance, laws, etc. In the course of business operations, the stable core teamhas developed a corporate culture that ties in with the Company’s development, summarised management experience with industrycharacteristics, and formed a team advantage integrating management and culture, allowing it to accurately grasp the industrydevelopment trend. At the same time, the Company has paid attention to the construction of a talent reserve and cultivationmechanism. With advanced business concepts and enormous development space, the Company has attracted an array of high-
calibre professionals and improved the level of human capital construction, providing solid guarantee for the Company’s long-term sustainable development.
⑧ Advantages in environmental governance capacity
The Company has actively upheld the concept of “lucid waters and lush mountains are invaluable assets”, adhered to thedevelopment idea of “placing green development and environmental protection as its priority”, always regarded environmentalprotection as the “life project”, clung to the green development model of clean production and resource recycling, and earnestlyshouldered the corporate responsibility for environmental protection. In recent years, the Company and its subsidiaries haveinvested more than RMB8 billion in total in environmental protection, and have constructed the pollution treatment facilitiesincluding the alkali recovery system, reclaimed water treatment system, reclaimed water reuse system, white water recoverysystem and black liquor comprehensive utilisation system. The environmental protection indicators rank high in China and in theworld. At present, the Company adopts the world’s most advanced “ultrafiltration membrane + reverse osmosis membrane”technology to complete the reclaimed water recycling membrane treatment project, which is the largest reclaimed water reuseproject in the domestic paper industry. The reclaimed water recycle rate attains the industry-leading level. The reclaimed waterquality meets drinking water standards, which can save hundreds of thousands cubic metres of fresh water every day. Meanwhile,in response to the “dual carbon” policy, the Company actively introduces photovoltaic power generation and biomass powergeneration, continuously optimises the energy structure and improves the level of low-carbon production.
3. Major accounting data and financial indicators
(1) Major accounting data and financial indicators of the last three years
Retrospective adjustment to or restatement of the accounting data for prior years by the Company
□ Yes ? No
Unit: RMB
| As at the end of 2023 | As at the end of 2022 | Increase/decrease as at the end of the year compared to the end of the prior year | As at the end of 2021 | |
| Total assets | 79,487,052,953.58 | 84,301,017,409.62 | -5.71% | 82,869,661,681.08 |
| Net assets attributable to shareholders of the Company | 16,692,175,196.53 | 19,084,565,494.92 | -12.54% | 19,117,985,306.48 |
| 2023 | 2022 | Increase/decrease for the year as compared to the prior year | 2021 | |
| Revenue | 26,608,570,228.20 | 32,004,367,320.91 | -16.86% | 33,019,812,294.14 |
| Net profit attributable to shareholders of the Company | -1,281,289,649.82 | 189,290,120.82 | -776.89% | 2,065,513,108.71 |
| Net profit after extraordinary gains or losses attributable to shareholders of the Company | -1,942,120,184.70 | -361,459,377.16 | -437.30% | 1,743,876,537.12 |
| Net cash flows from operating activities | 4,389,949,308.82 | 3,449,824,242.37 | 27.25% | 8,581,888,192.64 |
| Basic earnings per share (RMB per share) | -0.45 | 0.03 | -1,600.00% | 0.56 |
| Diluted earnings per share (RMB per share) | -0.45 | 0.03 | -1,600.00% | 0.56 |
| Rate of return on weighted average net assets | -7.65% | 0.55% | Decreased by 8.2 percentage points | 9.56% |
Data specification: When calculating financial indicators such as earnings per share and rate of return on weighted averagenet assets, the interest on Perpetual Bonds of RMB47,430,410.96 during the reporting period is deducted.
(2) Key Major Accounting Data by Quarter
Unit: RMB
| Q1 | Q2 | Q3 | Q4 | |
| Revenue | 6,155,915,692.16 | 6,409,047,089.15 | 7,156,893,450.74 | 6,886,713,996.15 |
| Net profit attributable to shareholders of the Company | -275,409,967.37 | -412,670,196.73 | -80,213,259.42 | -512,996,226.30 |
| Net profit after extraordinary gains or losses attributable to shareholders of the Company | -327,893,189.14 | -483,946,028.35 | -439,773,872.12 | -690,507,095.09- |
| Net cash flows from operating activities | 916,852,965.06 | 866,234,782.53 | 1,858,270,213.08 | 748,591,348.15 |
Whether the above indicators or their aggregated amounts have any material difference with the respective amounts as disclosed inthe quarterly report or interim report
□ Yes ? No
4. Share capital and shareholders
(1) Table of the number of shareholders of ordinary shares and shareholders of preference shares with voting rightsrestored and shareholding of top ten shareholders
Unit: Shares
| Total number of ordinary shareholders as at the end of the reporting period | 142,995, of which 121,718 were holders of A shares, 20,954 were holders of B shares and 323 were holders of H shares | Total number of ordinary shareholders as at the end of the month prior to the publication date of this annual report | 140,889, of which 119,803 were holders of A shares, 20,763 were holders of B shares and 323 were holders of H shares | Total number of holders of Preference Shares with restored voting right as at the end of the reporting period (if any) (Note VIII) | 0 | Total number of holders of Preference Shares with restored voting right as at the end of the month prior to the disclosure date of the annual report (if any) (Note VIII) | 0 | |||||
| Shareholdings of top 10 shareholders (excluding the shares lent under refinancing business) | ||||||||||||
| Name of shareholders | Nature of shareholders | Percentage of shareholding | Number of shares held | Number of restricted shares held | Shares pledged, tagged or locked-up | |||||||
| Status of shares | Number | |||||||||||
| CHENMING HOLDINGS COMPANY LIMITED | State-owned legal person | 15.47% | 457,322,919 | 0 | Pledged | 268,994,000 | ||||||
| HKSCC NOMINEES LIMITED | Overseas legal person | 12.63% | 373,461,275 | 0 | ||||||||
| CHENMING HOLDINGS (HONG KONG) LIMITED (Note 1) | Overseas legal person | 12.32% | 364,131,563 | 0 | ||||||||
| Hong Zejun | Domestic natural person | 1.19% | 35,300,000 | 0 | ||||||||
| Chen Hongguo | Domestic natural person | 0.85% | 25,080,044 | 17,310,033 | ||||||||
| SHANDONG SUN HOLDINGS GROUP CO., LTD. | Domestic non-state-owned legal person | 0.85% | 24,987,117 | 0 | ||||||||
| China Merchants Securities (HK) Co., Limited | Overseas legal person | 0.71% | 20,972,258 | 0 | ||||||||
| VANGUARD EMERGING MARKETS STOCK INDEX FUND | Overseas legal person | 0.50% | 14,852,146 | 0 | ||||||||
| VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND | Overseas legal person | 0.50% | 14,771,945 | 0 | ||||||||
| HONG KONG SECURITIES CLEARING COMPANY LIMITED | Overseas legal person | 0.38% | 11,251,780 | 0 | ||||||||
| Related party relationship or acting in concert among the above shareholders | A shareholder, Chenming Holdings (Hong Kong) Limited, which is an overseas legal person, is a wholly-owned subsidiary of a shareholder, Chenming Holdings Company Limited, which is a state-owned legal person; A shareholder, Chen Hongguo, is the legal representative and chairman of Chenming Holdings Company Limited. Save for the above, it is not aware that any other shareholders of tradable shares are persons acting in concert. It is also not aware that any other shareholders of tradable shares are related to each other. | |||||||||||
| Securities margin trading of shareholders | Chenming Holdings Company Limited held 457,322,919 RMB ordinary shares, of which 326,322,919 shares were held through ordinary account and 131,000,000 shares were held through credit guarantee security account; Hong Zejun held 35,300,000 RMB ordinary shares, of which no share was held through ordinary account and 35,300,000 shares were held through credit guarantee security account; Shandong Sun Holdings Group Co., Ltd. held 24,987,117 RMB ordinary shares, of which no share was held through ordinary account and 24,987,117 shares were held through credit guarantee security account. | |||||||||||
Note 1: In order to meet its own capital needs, Chenming Holdings (Hong Kong) Limited conducted share financing business withoverseas institutions, entrusting 210,717,563 B shares and 153,414,000 H shares of the Company held by it to the custodybrokerage designated by overseas institutions. The aforesaid shares were subject to the risk of not to be recovered, which may leadto a reduction in the Company’s shareholding, but does not affect Chenming Holdings’ position as the largest shareholder, anddoes not affect the Company’s control. For details, please refer to the announcement disclosed by the Company on CNINFO on 18July 2023 (announcement no.: 2023-058) and the insider information disclosed by the Company on the website of Hong KongStock Exchange on 18 July 2023.Share lending by top 10 shareholders under refinancing business
□ Applicable ? Not applicable
Changes in top 10 shareholders as compared to prior period? Applicable □ Not applicable
Unit: share
| Changes in top 10 shareholders as compared to prior period | |||||
| Name of shareholder (full name) | Addition/exit during the reporting period | Number of shares lent out but not yet returned under refinancing arrangement as at the end of the period | Shareholding under ordinary account and credit account and the number of shares lent out but not yet returned under refinancing arrangement as at the end of the period | ||
| Total | Percentage of total share capital | Total | Percentage of total share capital | ||
| GUOTAI JUNAN SECURITIES (HONG KONG) LIMITED | Exit | 0.00 | 0.00% | 6,252,684 | 0.00% |
| China Merchants Securities (HK) Co., Limited | Addition | 0.00 | 0.00% | 20,972,258 | 0.00% |
(2) Total number of holders of Preference Shares of the Company and the shareholdings of the top ten holders ofPreference Shares
□ Applicable ? Not applicable
During the reporting period, there was no shareholding of holders of preference shares of the Company.
(3) Chart illustrating the relationship between the Company and the beneficial controller
5. Situation of bonds in existence on the date of approval of the annual report
□ Applicable ? Not applicable
III. Matters of significance
1. Payment of corporate bonds of RMB350 million
On 3 April 2023, the Company entrusted the Shenzhen Branch of China Securities Depository & Clearing Co., Ltd. tocomplete the payment of principal and interest of “18 Chenming Bond 01” of RMB350 million in accordance with the “FirstTranche of Corporate Bonds Publicly Issued to Qualified Investors in 2018”. The bond was delisted from the Shenzhen StockExchange on the same day.For details, please refer to the relevant announcement disclosed by the Company on CNINFO on 30 March 2023(announcement number: 2023-015) and the overseas regulatory announcement disclosed by the Company on the website of HongKong Stock Exchange on 30 March 2023.
2. Redemption of perpetual bonds of RMB1 billion
On 11 July 2017, the Company issued the 2017 First Tranche of Medium-term Notes (bond abbreviation: 17 Lu ChenmingMTN001, bond code: 101779001) amounting to RMB1 billion with a term of 3+N. According to the “Prospectus of theCompany’s 2017 First Tranche of Medium-term Notes”, “17 Lu Chenming MTN001” is subject to the issuer’s redemption option.On 11 May 2023, the Company disclosed the Announcement on Exercise of Redemption Option of Issuer of 2017 First Tranche ofMedium-term Notes of Shandong Chenming Paper Holders Limited on Shanghai Clearing House (www.shclearing.com) andChina Money (www.chinamoney.com.cn), and redeemed the RMB1 billion perpetual bonds in full on 12 July 2023, with principaland interest payment amounted to RMB1,089.70 million. To date, all the bonds of the Company have been redeemed.
For details, please refer to the relevant announcement disclosed by the Company on CNINFO on 15 July 2023(announcement number: 2023-049) and the overseas regulatory announcement disclosed by the Company on the website of HongKong Stock Exchange on 14 July 2023.
12.32%
15.47%
3. Termination of asset purchase through the issuance of shares and cash payments
On 27 February 2023, the Company convened the 2023 first extraordinary general meeting, the 2023 first class meeting forholders of domestic-listed shares and the 2023 first class meeting for holders of overseas-listed shares, at which the Companyconsidered and approved relevant resolutions including the Report on the Agreement on Asset Purchase through Issuance ofShares and Cash Payments and Connected Transactions (Draft) of the Company. The Company intended to acquire 1.19% equityinterests in Shouguang Meilun held by Dongxing Securities Investment Co., Ltd., 44.44% limited partnership share in ChenrongFund held by Chongqing International Trust Inc. through issuance of shares. The Company’s wholly-owned subsidiary, ChenmingInvestment, intended to acquire 0.22% general partnership interest in Chenrong Fund held by Chenming (Qingdao) AssetManagement Co., Ltd. through cash payment. The type of shares to be issued by the Company is A shares, the price of the sharesto be issued is RMB4.42 per share, and the number of shares to be issued is 71,841,345 shares.
On 14 March 2023, the Company received the Notice on the Acceptance of Application Documents for Asset Purchasethrough the Issuance of Shares of Shandong Chenming Paper Holdings Limited (Shen Zheng Shang Shen [2023] No. 259) 《( 關於受理山東晨鳴紙業集團股份有限公司發行股份購買資產申請文件的通知》(深證上審[2023]259 號)) from the ShenzhenStock Exchange.
On 29 June 2023, the Company convened the eighth extraordinary general meeting of the tenth session of the Board and thefourth extraordinary general meeting of the tenth session of the Supervisory Committee, at which the Company considered andapproved the Resolution on the Termination of the Asset Purchase through Issuance of Shares and Cash Payments and ConnectedTransactions and Withdrawal of the Application Documents and agreed to terminate the transaction, sign the relevant terminationagreement with the counterparty if needed and apply to the Shenzhen Stock Exchange for relevant application documents for thewithdrawal of the transaction.
For details, please refer to the relevant announcements disclosed by the Company on CNINFO on 28 February 2023, 16March 2023 and 30 June 2023 (announcement number: 2023-010, 2023-014, 2023-048) and the relevant announcements disclosedby the Company on the website of Hong Kong Stock Exchange on 27 February 2023, 15 March 2023 and 29 June 2023.
4. Introduction of strategic investors by Zhanjiang Chenming
On 20 September 2023, the Company convened the eleventh extraordinary meeting of the tenth session of the Board, at whichthe Proposal on Capital Contribution and Introduction of Strategic Investors of a Controlling Subsidiary was considered andapproved. Given the promising development prospects of Zhanjiang Chenming Pulp & Paper Co., Ltd. (“Zhanjiang Chenming”), acontrolling subsidiary of the Company, and the high recognition of the pulp and paper integration strategic layout, ShandongCaixin Investment Co., Ltd., a wholly-owned subsidiary of Shandong key state-owned enterprise Shandong Caixin AssetOperation Co., Ltd., made capital contribution to Zhanjiang Chenming in the amount of RMB300 million.
For details, please refer to the relevant announcement disclosed by the Company published on CNINFO on 21 September2023 (announcement no.: 2023-072) and the overseas regulatory announcement disclosed on the website of Hong Kong StockExchange on 20 September 2023.
5. Business status of Chenming Leasing
At present, the Company focuses on the development of its principal activities, i.e. pulp production and paper making, andcontinues to reduce the size of the financial leasing business. As at the end of the reporting period, the balance of financial leasesof Chenming Leasing decreased to RMB4.8 billion. Some financial lease receivables were overdue with the overdue principalsamounting to RMB1,440 million, for which provisions of RMB430 million were made, and a provision coverage rate of 29.9%.Certain assets have been seized through litigation. The Company has resorted to, among other things, control of the underlyingassets, litigation for seizure, recovery for guarantors and debt reconstruction with the overall risks under control.
6. Information disclosure index for 2023 Annual Report
| Announcement No. | Subject matter | Date of publication | Publication website and index |
| 2023-001 | Announcement on Receipt of Government Subsidies | 3 January 2023 | http://www.cninfo.com.cn |
| 2023-002 | Announcement on Pledge of Shares and Partial Release of Pledge of Shares by Shareholders | 19 January 2023 | http://www.cninfo.com.cn |
| 2023-003 | Announcement on Resolutions of the Sixth Extraordinary Meeting of the Tenth Session of the Board of Directors | 20 January 2023 | http://www.cninfo.com.cn |
| 2023-004 | Announcement on Resolutions of the Third Extraordinary Meeting of the Tenth Session of the Supervisory Committee | 20 January 2023 | http://www.cninfo.com.cn |
| 2023-005 | Notice of the 2023 First Extraordinary General Meeting, 2023 First Class Meeting for Holders of Domestic-listed Shares, and 2023 First Class Meeting for Holders of Overseas-listed Shares | 30 January 2023 | http://www.cninfo.com.cn |
| 2023-006 | Announcement on Effects of Dilution on the Current Earnings Per Share As a Result of the Transaction and Relevant Remedial Arrangement of the Company | 20 January 2023 | http://www.cninfo.com.cn |
| 2023-007 | 2022 Annual Results Forecast | 31 January 2023 | http://www.cninfo.com.cn |
| 2023-008 | Announcement on the Continued Pledge of Shares held by Shareholders | 11 February 2023 | http://www.cninfo.com.cn |
| 2023-009 | Reply to the Inquiry Letter on Restructuring from the Shenzhen Stock Exchange | 16 February 2023 | http://www.cninfo.com.cn |
| 2023-010 | Announcement on Resolutions of the 2023 First Extraordinary General Meeting, 2023 First Class Meeting for Holders of Domestic-listed Shares, and 2023 First Class Meeting for Holders of Overseas-listed Shares | 28 February 2023 | http://www.cninfo.com.cn |
| 2023-011 | Self-inspection Report on the Trading of Shares by Insiders on Asset Purchase Through Issuance of Shares and Cash Payments and Related Party Transaction | 28 February 2023 | http://www.cninfo.com.cn |
| 2023-012 | Supplementary Announcement on the Self-inspection Report on the Trading of Shares by Insiders on Asset Purchase Through Issuance of Shares and Cash Payments and Related Party Transaction | 7 March 2023 | http://www.cninfo.com.cn |
| 2023-013 | Announcement on the Continued Pledge of Shares held by Shareholders | 11 March 2023 | http://www.cninfo.com.cn |
| 2023-014 | Announcement on the Acceptance of Asset Purchase Through Issuance of Shares and Cash Payments and Related Party Transaction by the Shenzhen Stock Exchange | 16 March 2023 | http://www.cninfo.com.cn |
| 2023-015 | Shandong Chenming Paper Holdings Limited Announcement on Payment of 2023 Interest and Delisting with Respect to the First Tranche of Corporate Bonds Publicly Issued to Qualified Investors in 2018 | 30 March 2023 | http://www.cninfo.com.cn |
| 2023-016 | Announcement on Resolutions of the Fourth Meeting of the Tenth Session of the Board of Directors | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-017 | Announcement on Resolutions of the Fourth Extraordinary Meeting of the Tenth Session of the Supervisory Committee | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-018 | 2022 Annual Report Summary | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-019 | Notice of 2022 Annual General Meeting | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-020 | Special Statement on Securities Investment in 2022 | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-021 | Announcement on Appointment of Auditor for 2023 | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-022 | Announcement on the Development of Equipment Financing Business | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-023 | Announcement on Carrying out Factoring Business of Accounts Receivable | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-024 | Announcement on Expected Provision of Guarantees to Subsidiaries for 2023 | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-025 | Special Statement on the Proposed Non-Distribution of Profit for 2022 | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-026 | Announcement on Changes in Accounting Policies | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-027 | Announcement on the 2022 Annual Online Performance Briefing | 31 March 2023 | http://www.cninfo.com.cn |
| 2023-028 | Announcement on Receiving the Notice on Suspending the Review of Asset Purchase Through Issuance of Shares and Cash Payments and Related Party Transaction from the Shenzhen Stock Exchange | 1 April 2023 | http://www.cninfo.com.cn |
| 2023-029 | Supplementary Notice of 2022 Annual General Meeting | 1 April 2023 | http://www.cninfo.com.cn |
| 2023-030 | Announcement on Resolutions of the Seventh Extraordinary Meeting of the Tenth Session of the Board of Directors | 20 April 2023 | http://www.cninfo.com.cn |
| 2023-031 | Announcement on the Operational Property-secured Loan by a Subsidiary and Provision of Guarantee therefor | 20 April 2023 | http://www.cninfo.com.cn |
| 2023-032 | Notice of the 2023 Second Extraordinary General Meeting | 20 April 2023 | http://www.cninfo.com.cn |
| 2023-033 | Announcement on the Continued Pledge of Shares held by Shareholders | 22 April 2023 | http://www.cninfo.com.cn |
| 2023-034 | Announcement on Application for Resumption of Review of Asset Purchase Through Issuance of Shares and Cash Payments and Related Party Transaction | 25 April 2023 | http://www.cninfo.com.cn |
| 2023-035 | Announcement on Receiving the Notice of Resumption of Review from the Shenzhen Stock Exchange | 26 April 2023 | http://www.cninfo.com.cn |
| 2023-036 | Announcement on Signing a Strategic Cooperation Agreement with China Construction Bank Shandong Branch | 26 April 2023 | http://www.cninfo.com.cn |
| 2023-037 | Announcement on the Meeting Arrangements for the Review of Asset Purchase Through Issuance of Shares and Cash Payments and Related Party Transaction by the Listing Review Center of the Shenzhen Stock Exchange | 26 April 2023 | http://www.cninfo.com.cn |
| 2023-038 | Announcement on Receiving the Opinion Implementation Letter from the Listing Review Center of the Shenzhen Stock Exchange | 28 April 2023 | http://www.cninfo.com.cn |
| 2023-039 | Announcement on Resolutions of the Fifth Meeting of the Tenth Session of the Board of Directors | 29 April 2023 | http://www.cninfo.com.cn |
| 2023-040 | Announcement on Resolutions of the Fifth Meeting of the Tenth Session of the Supervisory Committee | 29 April 2023 | http://www.cninfo.com.cn |
| 2023-041 | 2023 First Quarterly Report | 29 April 2023 | http://www.cninfo.com.cn |
| 2023-042 | Announcement on Signing of the Agreement on the Recovery of State-owned Construction Land Use Right signed by Wuhan Chenming | 29 April 2023 | http://www.cninfo.com.cn |
| 2023-043 | Announcement on Resolutions of the 2023 Second Extraordinary General Meeting | 9 May 2023 | http://www.cninfo.com.cn |
| 2023-044 | Announcement on Resolutions of 2022 Annual General Meeting | 13 May 2023 | http://www.cninfo.com.cn |
| 2023-045 | Announcement on Safety Accidents Occurred by the Slurry Residue Outsourcing Entity of a Subsidiary | 25 May 2023 | http://www.cninfo.com.cn |
| 2023-046 | Announcement on Resolutions of the Eighth Extraordinary Meeting of the Tenth Session of the Board of Directors | 30 June 2023 | http://www.cninfo.com.cn |
| 2023-047 | Announcement on Resolutions of the Fourth Extraordinary Meeting of the Tenth Session of the Supervisory Committee | 30 June 2023 | http://www.cninfo.com.cn |
| 2023-048 | Announcement on Termination and Withdrawal of Application Documents for Asset Purchase Through Issuance of Shares and Cash Payments | 30 June 2023 | http://www.cninfo.com.cn |
| 2023-049 | Announcement on Completion of Payment for 2017 First Tranche of Medium-term Notes | 15 July 2023 | http://www.cninfo.com.cn |
| 2023-050 | Announcement on Self-Inspection Report of Insider Trading in Respect of the Termination of Share Issuance and Cash Payments for Asset Purchase | 15 July 2023 | http://www.cninfo.com.cn |
| 2023-051 | 2023 Interim Results Forecast | 15 July 2023 | http://www.cninfo.com.cn |
| 2023-052 | Announcement on the Continued Pledge of Shares held by Shareholders | 15 July 2023 | http://www.cninfo.com.cn |
| 2023-053 | Announcement on Resolutions of the Ninth Extraordinary Meeting of the Tenth Session of the Board of Directors | 18 July 2023 | http://www.cninfo.com.cn |
| 2023-054 | Announcement on Resolutions of the Fifth Extraordinary Meeting of the Tenth Session of the Supervisory Committee | 18 July 2023 | http://www.cninfo.com.cn |
| 2023-055 | Announcement on Failing to Fulfil the Unlocking Conditions for the Second Unlocking Period Under the 2020 Restricted A Share Incentive Scheme and Repurchase and Cancellation of Certain Restricted Shares | 18 July 2023 | http://www.cninfo.com.cn |
| 2023-056 | Review Opinions on the Unlocking Conditions for the Second Unlocking Period Under the 2020 Restricted A Share Incentive Scheme and Repurchase and Cancellation of Certain Restricted Shares of the Supervisory Committee | 18 July 2023 | http://www.cninfo.com.cn |
| 2023-057 | Announcement on Repurchase and Cancellation of Certain Restricted Shares and Notice to Creditors | 18 July 2023 | http://www.cninfo.com.cn |
| 2023-058 | Announcement on Risks in Relation to the Ownership of B Shares and H Shares Held by the Controlling Shareholder | 18 July 2023 | http://www.cninfo.com.cn |
| 2023-059 | Announcement on the Release of Pledge of Shareholders’ Shares | 26 July 2023 | http://www.cninfo.com.cn |
| 2023-060 | Announcement on Continued Pledge of Shares held by Shareholders | 29 July 2023 | http://www.cninfo.com.cn |
| 2023-061 | Announcement on Continued Pledge of Shares held by Shareholders | 11 August 2023 | http://www.cninfo.com.cn |
| 2023-062 | Announcement on Update on Winding-Up Petition | 19 August 2023 | http://www.cninfo.com.cn |
| 2023-063 | Announcement on Pledge of Shareholders’ Shares | 29 August 2023 | http://www.cninfo.com.cn |
| 2023-064 | Announcement of Resolutions of the Board of Directors on Interim Report | 31 August 2023 | http://www.cninfo.com.cn |
| 2023-065 | Announcement of Resolutions of the Supervisory Committee on Interim Report | 31 August 2023 | http://www.cninfo.com.cn |
| 2023-066 | 2023 Interim Report Summary | 31 August 2023 | http://www.cninfo.com.cn |
| 2023-067 | Announcement on Resolutions of the Tenth Extraordinary Meeting of the Tenth Session of the Board of Directors | 9 September 2023 | http://www.cninfo.com.cn |
| 2023-068 | Announcement on Partial Disposal of Equity Interest in Wuhan Chenming | 9 September 2023 | http://www.cninfo.com.cn |
| 2023-069 | Announcement on Provision of External Financial Assistance upon the Disposal of Equity Interest in Wuhan Chenming | 9 September 2023 | http://www.cninfo.com.cn |
| 2023-070 | Notice of 2023 Third Extraordinary General Meeting | 9 September 2023 | http://www.cninfo.com.cn |
| 2023-071 | Announcement on Resolutions of the Eleventh Extraordinary Meeting of the Tenth Session of the Board of Directors | 21 September 2023 | http://www.cninfo.com.cn |
| 2023-072 | Announcement on Capital Increase and Introduction of Strategic Investors of a Majority-owned Subsidiary | 21 September 2023 | http://www.cninfo.com.cn |
| 2023-073 | Announcement on Resolution of the 2023 Third Extraordinary General Meeting | 27 September 2023 | http://www.cninfo.com.cn |
| 2023-074 | Announcement on Resolutions of the Twelfth Extraordinary Meeting of the Tenth Session of the Board of Directors | 9 October 2023 | http://www.cninfo.com.cn |
| 2023-075 | Announcement on Change of General Manager of the Company | 9 October 2023 | http://www.cninfo.com.cn |
| 2023-076 | 2023 Third Quarterly Report | 31 October 2023 | http://www.cninfo.com.cn |
| 2023-077 | Announcement on Continued Pledge of Shares held by Shareholders | 4 November 2023 | http://www.cninfo.com.cn |
| 2023-078 | Announcement on Completion of Repurchase and Cancellation of Certain Restricted Shares | 23 November 2023 | http://www.cninfo.com.cn |
| 2023-079 | Announcement on Continued Pledge of Shares held by Shareholders | 25 November 2023 | http://www.cninfo.com.cn |
| 2023-080 | Announcement on Resolutions of the Thirteenth Extraordinary Meeting of the Tenth Session of the Board of Directors | 29 November 2023 | http://www.cninfo.com.cn |
| 2023-081 | Announcement on the Disposal of Equity Interest in Investee | 29 November 2023 | http://www.cninfo.com.cn |
| 2023-082 | Announcement on Adjustment to Amount of Guarantee Between Subsidiaries | 15 December 2023 | http://www.cninfo.com.cn |
| 2023-083 | Announcement on Pledge of Shareholders’ Shares | 22 December 2023 | http://www.cninfo.com.cn |
| 2023-084 | Announcement on Progress of the Disposal of Equity Interest in Investee | 27 December 2023 | http://www.cninfo.com.cn |
| 2023-085 | Announcement on Pledge of Shareholders’ Shares | 30 December 2023 | http://www.cninfo.com.cn |
| The Board of Shandong Chenming Paper Holdings Limited |
| 28 March 2024 |