I. The main business of the company during the reporting period. 1. The company belongs to the iron and steel industry, and its main business scope includes: iron and steel smelting, steel calender processing; manufacturing and sales of sinter, coke and chemical products, blast furnace residual pressure power generation and gas production and sales; processing and sales of foreign body of industrial production waste; sales of metal materials, coke, chemical products, mechanical and electrical equipment and building materials; equipment rental (excluding automobiles); warehousing services; technology development, technical advice, technology transfer, technical service, technical training, investment and investment management. 2. The iron and steel products of Qianshun Base include two major kinds of plate products of hot series and cold series, among which, hot series has formed featured products such as pipeline steel, container steel, high strength steel, automobile structure steel, saw blade steel and pickling plate; cold rolling has formed automobile plate, silicon steel, home appliance plate, special plate, color coated plate and common plate. 3. Jingtang Company belongs to the iron and steel industry, with the main business scope including: iron and steel smelting, steel rolling, smelting of other metals and their calendering processing and sales; production and sale of sinter, pellet, coke, chemical products; production and marketing of various industrial gases; goods and technology entry and exit business (except for projects restricted or prohibited by the state); metallurgical technology research, technical advice, technical services; equipment lease, wharf, warehousing, transportation, material supply; wholesale and retail of iron and steel, other metals and their calendering products as well as ores, coal and chemical products processing, utilization and sale of wastes in industrial production; reclamation of sea land; provision of wharf facilities for ships; provision of cargo handling services in the port area. The iron and steel products of Jingtang Company include hot and cold series plate products. Among them, hot rolling forms a series of characteristic products mainly composed of pipeline steel, container steel, high strength steel and automobile structural steel, and cold rolling forms six major product series, automobile plate, home appliance plate, special plate, tin plate, color coated plate and common plate. 4. The main uses of the above iron and steel products include: the pipeline steel is mainly used for the transportation of oil, natural gas and other media; the high strength steel, including high-strength engineering machinery steel, explosion-proof steel for safes and ATM, fan steel, steel for truck carriages, etc., mainly used in the boom, body, beam and blower, mine fan and electric fan blade of manufacturing cranes, pump cars, special vehicles and other vehicles; weathering steel mainly includes steel for container, steel for mixing tank and steel for electric tower; steel for automobile structure mainly includes steel for automobile wheel, steel for automobile beam, for making the wheels of cars, passenger cars, heavy duty vehicles, construction machinery, agricultural vehicles and other vehicles, as well as structural parts such as crossbeams and longitudinal beams of various types of vehicle frames; hot rolled special plates mainly include welded cylinder steel, boiler and pressure vessel steel, which can be used to manufacture pressure equipment in containers containing liquefied petroleum gas, liquid nitrogen and other gases and special equipment; hot rolled pickling plate is mainly used in automobile, compressor, motorcycle, machinery manufacturing and hardware fittings, etc.; cold rolled automobile plate is mainly used for automobile inner and outer plate, spare parts, etc.; silicon steel is mainly used in motor and transformer manufacturing industry; home appliance plate is mainly used in inside and outside plates, structure plate, etc. of refrigerator, washing machine, air conditioning, TV set and small appliance; cold rolled special plate includes chain steel, enamel steel, container steel, welding wire steel, barrel steel, motorcycle standard parts, etc.; tin plate is mainly used in food industry to produce various containers, stamping products, packaging materials, etc.; color coated plate is widely used in construction, shipbuilding, vehicle manufacturing, furniture industry and so on.

II. Technological innovation

Technological innovation has been carried out and a series of fruitful results have been achieved with a complete set of ferrite rolling technology and blast furnace ball ratio smelting technology have been formed, which solves the technical bottleneck. The combined blowing of converter research team perseveres. The ratio of the whole furnace service is 100%, and the important quality scale, namely the converter carbon-oxygen product, is 0.00188, entering the international leading ranks. The discharge proportion of steelmaking of IF steel ≤ 1200 ℃ is more than 90%, reaching the advanced level in the world. Steel-making “flying bag” technology is maturing day by day, and the number of continuous casting furnaces is increased significantly. Realize the normal production of automobile outer panel, have double-sided O5 plate manufacturing capability. Hot-rolling capacity and thin-gauge stability are improved, and the time in furnace of silicon steel varieties significantly is shortened. Dual-phase steel DH780+Z and other 7 products were first launched in China, among which 2 products were first launched in the world. The company was awarded 219 patents in 2017, of which 94 were invention patents, and 125 were patents for utility models. Seven technical achievements, such as “Research and Application of Control Technology of High-Magnetic-Inductive Oriented Silicon Steel Full-Process Plate” have been awarded the scientific and technological innovation award by Beijing City and CISA. The project “Research and Application of Dual-scale Low NOx Combustion Technology of Coal-Gas Mixed Fired Boiler” won the second prize for metallurgical science and technology; the three achievements, “Integration and Innovation of Large KR High Efficiency and Low Consumption Intelligent Hot Metal Desulfurization Technology”, “High Temperature Oxidation Characteristics of Iron and Steel Materials and Their Application in Surface Quality Control of Strip Production” and “R&D and Application of Automatic Control System for Cold Rolling Processing Line” won third prize for metallurgical science and technology; the two projects, “Integrated Optimization Technology for Low Cost Seawater Desalination” and “Development and Application of Stable Production and Quality Control Integrated Technology for Cold Rolling and Thin Specification High Strength Automobile Plate”, were awarded the second prize of Hebei Province Science and Technology and the first prize of science and technology in Tangshan City respectively.

III. Product market competitiveness. The company has gradually grown into a high-quality plate manufacturing enterprise respected and trusted by domestic and foreign counterparts and market customers. A number of high-end products are used by high-end users and enter into key projects. The company has achieved stable supply of automotive steel for over 30 automobile enterprises, such as BMW, Mercedes-Benz, FAW, the Great Wall Motors and Geely, becoming the largest material supplier of five famous domestic car companies, BMW, Geely, the Great Wall Motors, BAIC and Changfeng Motors. The domestic market share of electrical steel products ranks second, and the market share of non-oriented electrical steel frequency conversion air conditioner compressor is 47% in the industry. One of every 2 domestic frequency conversion air conditioners is made of Shougang electrical steel. For three consecutive years, the monomer factory output of non-oriented electrical steel is the first in the world, and the oriented silicon steel has been in the world’s top suppliers of transformer materials, standing shoulder to shoulder with Pohang Steelers and Nippon Steel. The development of high-end customers of pickling board is beginning to show results. The company has become the main supplier of chassis materials for main engine factories such as Mercedes-Benz, Dongfeng Peugeot Citroen Automobile Company Ltd., FAW Mazda and Zhengzhou Nissan, and entered into the joint venture car seat and wheel fitting factories of Faurecia and Benteler. Beijing Shougang’s products often appeared in national major projects. Oriented silicon steel has achieved a breakthrough in the application of “double million” transformers in the national network; the company has become the largest transformer supplier in the world for the world’s largest hydropower project under construction; and the thin specification oriented electrical steel has been used in the first set of intelligent transformer power stations for high-speed trains in China.   

IV. In the aspect of management innovation ability, the company can play a leading role by setting up excellent examples, giving play to innovative organizations such as expert workstations, innovation studios, product and technical tackling teams, and promoting a stronger atmosphere of innovation for the whole staff. Innovative results keep emerging. “Practice of Creating Field Problem Management System in Large Iron and Steel Enterprises,” “Construction and Implementation of Incentive Mechanisms of Three Talent Teams Based on Enhancing the Core Competitiveness of Enterprises” were awarded the first prize and the second prize of management innovation in Beijing respectively. “Construction and Implementation of Plate Synergy System in Large-scale Iron and Steel Enterprises” won the second prize of CISA management innovation; three management achievements such as “Quality Process Management of Large-scale Iron and Steel Enterprises Based on the Theory of ‘Integration of Information Technology and Industrialization’” obtained the third prize of CISA Management Innovation Award respectively. The company won the “Outstanding Enterprise Award for Quality Management Activities in Hebei Metallurgical Industry in 2017”, with 9 projects winning awards in the metallurgical industry, management innovation and science and technology in Hebei Province. In March 2017, the company was awarded 3A credit rating by Dagong Global Credit Rating. In May 2017, the company was elected “Green Benchmarking Enterprise” of China Automotive Materials International Forum. In December, 2017, the company was named “Automobile Plate Excellent Manufacturer 3A-class Enterprise in National Iron and Steel Industry Chain” by custeel.com.

V. The company’s main accounting data and financial indicators. The operating income is 60.25 billion yuan, the total profit is 3.345 billion yuan, and the net profit attributable to the owners of the parent company is 2.211 billion yuan, with the earning per share of 0.42 yuan. The total assets are 134.159 billion yuan, and the shareholders’ equity attributable to the parent company is 26.42 billion yuan.

In 2017, the company was committed to high-end pursuit and continuous structural optimization, gained good harvests and achieved remarkable results. (1) The company completed 3.05 million tons of car plates, a year-on-year growth of 24.5%. The company achieved Japanese car enterprise certification supply breakthrough and supplied vehicles to Dongfeng Nissan and Guangzhou Auto Toyota; the supply for SAIC, Chang’an, Dongfeng Peugeot Citroen Automobile Company Ltd., and other joint venture users increased by 37% compared with the same period of last year; the EVI supply quantity achieved 500,000 tons, a year-on-year growth of  57.9%. (2) The company completed 1.5 million tons of electrical steel and development of 10 new products, and won 24 new customers. Seizing the market opportunities of new energy vehicle drive motor, the company achieved the batch supply of 5 customers such as Shanghai Eodrive Co., Ltd. and Jing-Jin Electric Technologies (Beijing) Co., Ltd. Oriented electrical steel finished the supply of 105 UHV transformers of 500kV and above, including 7 1,000kV UHV transformers; (3) tin plate achieved high-end customer coverage, and was evaluated by COFCO Group

Adhere to first-class standards, do a good job of energy conservation, continue to advance the green action plan, complete environmental management projects, such as upgrading and transformation of the environment of iron making and steelmaking; actively respond to requests from government departments to stop production and reduce emissions due to major social activities and extreme bad weather, activate emergency response 26 times; welcome 137 inspections from the State Ministry of Environmental Protection, the Central Environmental Protection Steering Group, the provincial environmental protection bureau, and the municipal environmental protection bureau. The inspection results show that the pollution emissions are far below the national standard. The pollution emission performance appraisal is green enterprise, and the proportion is the lowest in the iron and steel industry limited production enterprise in heating season of Tangshan City; in 2017, Jingtang Company obtained the first new emission license for the steel industry in China. The steel relocation company and the cold rolling company were also the first batch of iron and steel enterprises to obtain the new emission license. Jingtang Company’s No. 1 5,500-ton blast furnace and No. 3 300-ton converter won the “champion furnace” for energy saving and consumption reduction of key energy consuming steel production equipment in China; and became the “water efficiency leader in key water enterprises in China in 2017”. The environmental protection work won vigorously support of the local government, winning special fund subsidy for energy conservation and environmental protection.