恒力石化:恒力石化2021年半年度报告（英文删节版）

Contents
Chapter I Definition
Chapter I Main Financial Indicators
Chapter III Discussion and Analysis from the Management
Chapter IV Corporate Governance
Chapter V Environmental and Social Responsibility
Chapter VI Important Items
Chapter VII Share Changes and Shareholders
Chapter VIII Relevant Information of Preferred Shares
Chapter IX Relevant Information of Bonds
Chapter X Financial Report
I. Definition
In this report the terms listed below are defined as follows unless the context otherwise implies:
Definition of Frequently-Used Terms
Reporting Period Refers to From 1 January 2021 to 30 June 2021
Company the Company Refers to
or Hengli Petrochemical Hengli Petrochemical Co. Ltd.CSRC Refers to China Securities Regulatory Commission
SSE Refers to Shanghai Stock Exchange
Hengli Group Refers to Hengli Group Co. Ltd. controlling shareholder of the listed company
Hailaide International Investment Ltd. person acting-in- concert with
Hailaide Refers to controlling shareholder of the listed companyacting-in- concert with
controlling shareholder of the listed company
Tak Shing Li Refers to Tak Shing Li International Holdings Ltd. person acting-in- concert with controlling shareholder of the listed company
Hegao Investment Refers to Jiangsu Hegao Investment Co. Ltd. person acting-in-concert with controlling shareholder of the listed company
Hengneng Investment Refers to Hengneng Investment (Dalian) Co. Ltd. person acting-in- concert with
controlling shareholder of the listed company
Hengfeng Investment Refers to Hengfeng Investment (Dalian) Co. Ltd. person acting-in- concert with controlling shareholder of the listed company
Hengli Chemical Fiber Refers to Jiangsu Hengli Chemical Fiber Co. Ltd. subsidiary to the listed
company
Susheng Thermal Power Refers to JSuzhou Susheng Thermal Power Co. Ltd. subsidiary to the Hengli Chemical Fiber sub-subsidiary to the listed company
Hengke Advanced Materials Refers to Jiangsu Hengke Advanced Materials Co. Ltd subsidiary to the Hengli Chemical Fiber sub-subsidiary to the listed company
Deli Chemical Fiber Jiangsu Hengke Advanced Materials Co. Ltd subsidiary to the Hengli Refers to Chemical Fiber sub-subsidiary to the listed company
Kanghui New Material Formerly known as Yingkou Kanghui Petrochemical Co. Ltd. subsidiary to the Refers to listed company now renamed as Kanghui New Material Technology Co. Ltd.Hengli Petrochemical Chemical Refers to Hengli Petrochemical (Dalian) Chemical Co. Ltd. subsidiary to the listed company01
Hengli Investment Refers to Hengli Investment (Dalian) Co. Ltd. subsidiary to the listed company
Hengli Petrochemical (Dalian) Refers to Hengli Petrochemical (Dalian) Co. Ltd. subsidiary to the Hengli Investment sub-subsidiary to the listed company
Hengli Petrochemical (Huizhou) Refers to Hengli Petrochemical (Huizhou) Co. Ltd. subsidiary to the Hengli Investment sub-subsidiary to the listed company
Hengli Petrochemical Refining Refers to Hengli Petrochemical (Dalian) Refining Co. Ltd. subsidiary to the listed company
Crude oil is petroleum directly exploited from an oil well without being
Crude Oil Refers to processed and is a dark-brown or dark-green viscous liquid or semisolid
flammable substance that is composed of various hydrocarbons.A hydrocarbon containing a benzene ring structure in its molecule. Aromatic
Aromatic Hydrocarbon Refers to hydrocarbons mainly including benzene methylbenzene xylene etc. are one of
the most important basic raw materials for the production of petrochemicals.A compound consisting of two carbon atoms and four hydrogen atoms. It
is the basic chemical raw material of synthetic fiber synthetic rubber
Ethylene Refers to synthetic plastic (polyethylene and polyvinyl chloride) synthetic ethanol
(alcohol) and also used in manufacturing chloroethylene styrene ethylene
oxide acetic acid acetaldehyde ethanol and explosives etc.A thermoplastic resin produced by polymerization of ethylene. Polyethylene is
Polyethylene Refers to odorless and non-toxic and feels like wax has excellent low-temperature resistance
good chemical stability and resistance to erosion of most acid and alkali.A semi-crystalline synthetic resin material with strong acid and alkali
Polypropylene (PP) Refers to resistance excellent electrical insulation capacity harder character and
higher melting point than PE.Styrene Refers to An organic compound which is usually a colorless but aromatic liquid mainly used in the production of plastic resin and rubber.Butadiene Refers to An organic compound which is a colorless gas with a distinctive odor is the main raw material in the production of synthetic rubber.A kind of aromatic hydrocarbon which is a colorless and transparent
Paraxylene (PX) Refers to liquid and is a raw material in the production of purified terephthalic acid
(PTA) used for manufacturing plastic polyester fiber and film.Purified Terephthalic Acid (PTA) Refers to A white crystal or powder at room temperature non-toxic and flammable which will burn as soon as catching fire if mixing with air to a certain degree.A colorless odorless sweet viscous liquid mainly used in the production
Ethylene Glycol (MEG or EG) Refers to of polyester fiber antifreeze unsaturated polyester resin lubricant
plasticizer non-ionic surfactant and explosive.Acetic Acid An organic compound which is a colorless liquid with a pungent odor and Refers to is the raw material for the production of rayon filmstrip aspirin etc.Polyethylene Terephthalate or Polyester or PET is a fiber-forming polymer
made from PTA and MEG through interesterification or esterification and
Polyester Polyester Chip or PET Refers to condensation polymerization. Fiber-grade polyester chips are used for producing polyester staple fibers and polyester filament yarn while
film-grade chips are used for producing all categories of film products.Poly (butylene adipate-co-terephthalate) or PBAT is a petrochemical-based
PBAT Refers to biodegradable plastic with sound biodegradability and is an active material in
biodegradable plastic research with broad market application.02
Polybutanediol succinate or PBS is polymerized from succinate acid and
Butane-14-diol (BDO) with sound thermal performance and mechanical
PBS Refers to processing performance. It is a typical fully biodegradable material easy to be
decomposed and metabolized by a variety of natural microorganisms or enzymes
in animals and plants and finally decomposed into carbon dioxide and water.A synthetic fiber made of polyester formed by polycondensation of
organic diacid and dihydric alcohol by spinning. The industrialized
Polyester Fiber Refers to massively produced polyester fiber is made from PET and is known as
dacron in China. It is the top major variety of synthetic fiber at present.Polybutylene Terephthalate Refers to It is a condensation polymer of para toluic acid and Butane-14-diol which can be prepared by the methods of transesterification or direct esterification through
(PBT) polycondensation. PBT and PET together are known as thermoplastic polyesters.Biaxially-Oriented Polyethylene BOPET has the characteristics of high strength good rigidity transparency high
Terephthalate (BOPET) Refers to gloss etc. with excellent wear resistance folding resistance pinhole resistance
and tear resistance minimal thermal shrinkage and sound antistatic property.Denier (D) Refers to 9000-meter fiber weighs 1 gram and is called 1 denier (D).Polyester Filament Yarn (PFY) Refers to Balls wound by filament yarn of more than 1 km in length.PFY for Civil Use Textile Yarn Refers to PFY used for clothing and household textile.PFY for Industrial Use Refers to Polyester macrofiber in large denier with strong strength and high
Industrial Yarn modulus for industrial use.A new fiber variety that is differentiated from normal varieties with
Differential Fiber Refers to evident breakthroughs on techniques or performance or with certain special properties mainly used for improving wearability through
chemical modification or physical deformation.Pre-oriented yarn or partially oriented yarn (POY) is partially drawn
POY Refers to PFY obtained by high-speed spinning with orientation between the
unoriented yarn and the full drawn yarn.DTY Refers to Draw textured yarn (DTY) is made of POY through drawing and false twist texturing usually with certain elasticity and contractibility.Full Drawn Yarn (FDY) is a synthetic fiber filament further prepared by
FDY Refers to the spinning and drawing process. The fiber has been fully drawn and
can be directly used for textile processing.03
II. Main Accounting Data and Financial Indicators of the Company
Unit: 10000 yuan Currency: CNY
The Current Increase/Decrease
Reporting Period The Same Period of Main Accounting Data over the Same Period
(Jan.-Jun.) the Previous Year of the Previous Year (%)
Operating Income 10457447.80 6735793.52 55.25
Net Profits Attributable to
Shareholders of the Listed 864220.71 551686.00 56.65
Company
Net Profits Attributable to
Shareholders of the Listed 826613.64 549468.83 50.44
Company after Deducting
Non-recurring Gains and Losses
Net Cash Flow from
Operating Activities 1618009.23 1819232.26 -11.06
Increase/Decrease at the
The End of The End of End of Current Reporting
Current Report- Previous Year Period Compared to the
ing Period End of Previous Year (%)
Net Assets Attributable to
Shareholders of the Listed 5013805.06 4690507.69 6.89
Company
Total Assets 20094587.59 19102872.66 5.19
The Current Increase/Decrease
The Same Period of
Main Financial Indicators Reporting Period over the Same Period
(Jan.-Jun.) the Previous Yea of the Previous Year (%)
Basic EPS (Yuan/Share) 1.23 0.79 55.70
Diluted EPS (Yuan/Share) 1.23 0.79 55.70
Basic EPS after Deducting
Non-Recurring Gains and 1.18 0.78 51.28
Losses (Yuan/Share)
ROEWA (%) 17.17 14.26 Up 2.91 Percentage Points
ROEWA after Deducting Non-Re-
curring Gains and Losses (%) 16.43 14.20 Up 2.23 Percentage Points
Notes on Main Accounting Data and Financial Indicators of the Company
The increase in operating income during the reporting period is mainly attributed to the fact that the 1.5 million-tonne
ethylene project and the 2*2.5 million-tonne PTA project of the Hengli Petrochemical Chemical reached the target
output in the middle and latter half of the year 2020. The increase in net profits and EPS during the reporting period is
mainly attributed to the 1.5 million- tonne ethylene project and the upward trend of the industry cycle.04
Items and Amount of Non-recurring Gains and Losses
Unit: 1 yuan Currency: CNY
Non-recurring Gains and Amount Note (If Applicable)
Losses Items
Profit and loss of disposal of non-current assets 4523942.28
Government subsidies included in the profit and loss of the
current period excluding those that are closely relevant to the
normal business operation of the Company and continuously 255116975.93
enjoyed by the Company in accordance with national policies
and regulations by a certain standard quota or quantity
Profit and loss of fair value changes incurred from trading
financial assets derivative financial assets trading financial
liabilities and derivative financial liabilities of the Company and
income on investment incurred from the disposal of trading
financial assets derivative financial assets trading financial 90319689.28
liabilities and derivative financial liabilities and other debt
investment in addition to effective hedging business relevant to
normal business operation of the Company
Other non-operating incomes and expense apart from the
above-mentioned 8775715.26
Others that conform to the definition of non-recurring gains
and losses items 2671926.82
Amount subject to minority stockholder’s interest 45084433.90
Amount subject to income tax -30421940.82
Total 376070742.6505
III. Discussion and Analysis from the Management
Notes on Industrial Background and Main Business of the Company during the Reporting Period
1. Industrial Background of the Company ny has become the PTA production supplier with the largest
production capacity the most advanced techniques and the
(1) Petrochemical most evident cost advantage in the world and the only company with a production capacity of more than 10 million
The Company has a petrochemical and production capacity tonnes calculated by the shareholding ratio in the industry.of 20 million tonnes per year mainly producing 4.5
million-tonne PX 1.8 million-tonne EG and 400000-tonne
acetic acid for downstream use of the Company. In addition (3) Advanced Materials
it produces 960000-tonne purified petroleum benzine One of the main businesses of the Company is R&D produc-
850000-tonne PP 720000-tonne styrene 400000-tonne tion and sales of products related to advanced polyester
high-density PE 140000-tonne butadiene and other materials. Its main products cover PFY for civil use PFY for
high-end chemical products with a shortage in supply and industrial use functional films engineering plastics
high additional value in China. As small-scale refineries with PBAT/PBS and other polyester and advanced chemical
higher production costs and outmoded equipment are material products. The production capacity of PFY for civil
phased out gradually centralization of the refining industry use ranks top five in China while that of PFY for industrial
and competitiveness of newly-built large-scale refineries will use ranking second place across the country making the
be dramatically enhanced. With prominent advantages in Company one of the manufacturers of PFY for both civil and
terms of policy support process techniques and industrial industrial use with the largest scale and the most advanced
collaboration etc. the Company compared with other petro- techniques in China. In addition the Company has an annual
chemical businesses has obvious characteristics of large output of 266000 tonnes of functional films 240000
petrochemical scale a high proportion of chemical products tonnes of engineering plastics and 33000 tonnes of degrad-
complete supporting facilities and low energy consumption able plastics. Meanwhile 3 production lines of functional
thus gaining strong market competitiveness. films (120000 tonnes/year) and 4 production lines for
modified engineering plastics/PBS (30000 tonnes/year)
(2) PTA are under construction in Yingkou which are expected to be put into operation successively in the second half of 2021.
PTA is the direct upstream raw material of PET. China is the Projects of 450000-tonne degradable plastics in Changxing
largest producer and consumer of PTA in the world. Current- Island of Dalian and 470000-tonne high-end functional
ly the Company has a PTA production capacity of 11.6 million polyester films 100000-tonne special functional films
tonnes per year and has 2 PTA production lines with a total 150000-tonne modified PBT and 80000-tonne modified
capacity of 5 million tonnes under construction. The Compa- PBAT in Fen Lake of Suzhou are under construction.2. Basic Information of Main Business of tonnes of PX and 400000 tonnes of acetic acid annually in
the Company the upstream and 11.6 million tonnes of PTA and 1.8 million
tonnes of fiber-grade EG in the midstream. Its PTA and EG
The main business of the Company covers refining petro- products are partially for private use and the rest are for
chemical and production R&D and sales of PX acetic acid market sales. In the downstream it has extensive varieties of
PTA EG Polyester Chip PFY for civil use PFY for industrial advanced chemical material products with complete specifi-
use functional films engineering plastics PBS /PBAT cations targeting the middle and high-end market including
bio-degradable advanced materials that relating to the whole PFY for civil use PFY for industrial use BOPET PBT PBS/P-
industry chain of advanced polyester materials including BAT and other polyester and advanced chemical material
downstream midstream and upstream business. It is the first products applied in textile pharmaceutical automobile
listed company of advanced chemical materials in the indus- environment and new energy electronics PV optical instru-try with integration of the whole industry chain of “crude oil - ment and other industries with large scale differentiationaromatic hydrocarbon alkene - PTA EG - new polyester and high additional value and civil areas concerning basicmaterials”. necessities of life with massive demands.The Company has a production capacity of 4.5 million As the world-class petrochemical and ethylene projects06
concerning key production capacity and all categories of deepen and optimize the “major chemical” platform support
scarce chemical raw materials in the upstream have been and raw material support for high-end advanced material
fully put under operation and the competitive advantages of and fine chemical engineering business in the downstream
the PTA business in the midstream keep expanding and to continuously extend the value and industrial chain of
cementing the Company is accelerating its pace to sustain advanced materials.Analysis of Core Competitiveness During Reporting Period
1. Leading Strategic Advantage in the been equipped with the high-quality and efficient production
Whole Industry Chain Development capacity structure and public engineering supportingfacilities featuring “equipment upsizing capacity scaling-upstructural integration technique advancement greennessThe Company is the earliest and fastest leading enterprise in and environmental-friendliness and complete support” in
the industry to engage in the whole industrial chain strategic the whole industrial chain of advanced polyester material
development of polyester advanced materials in China. It is covering the upstream midstream and downstream. Its
actively promoting collaborated and balanced development processing scale and technical level which are second to
of all business segments vigorously expands high-end none in the industry in terms of individual unit installation
production capacity in both upstream and downstream total production capacity and process techniques giving the
commits itself to creating a world-class development pattern Company scale advantages and operation efficiency in unit
for a listed platform with collaboration and integration of the investment costs material and energy consumption conser-whole industrial chain covering “crude oil - aromatic hydro- vation unit processing costs product delivery circle productcarbon alkene - PTA EG - polyester - PFY for civil use PFY quality and diversification etc. and ensuring stable andfor industrial use films plastics”. The Hengli 20 million preeminent quality performance. In addition with the most
tonnes/year petrochemical integration project and the 1.5 complete supporting capacity in the industry including
million tonnes/year ethylene project are under full produc- power energy port wharf tank field warehouse and
tion which marks a strategic breakthrough of the Company logistics the Company enjoys remarkable superiority in
on key links in the petrochemical and production chain of comprehensive operation covering comprehensive cost
aromatic hydrocarbon and alkene making the Company saving service quality and performance operation efficien-
takes the lead in the industry to actualize integration of the cy etc. In the industrial park oil refining chemical engineer-whole industry chain of “crude oil - aromatic hydrocarbon ing and coal-based chemical processing are complementaryalkene - PTA EG - new polyester materials”. In addition with to and mutually reliant on each other with a balance of high
new projects of PTA advanced chemical materials PBS/P- efficiency and cost control. The petrochemical business of
BAT bio-degradable advanced materials etc. successively the Company is equipped with the largest-scale coal-hydro-
being inaugurated and under operation the Company is gen production facility across the country generating
gradually upgrading and optimizing its industrial layout low-cost pure hydrogen methanol acetic acid syngas and
consolidating and expanding its industrial strengths in all other coal-based chemical products which together with
links promoting the quantitative transition of its business the Company’s advantages in storage and logistics of raw
scope and qualitative transition of its business structure to materials and products dramatically improves the operation-
foster strategic superiority of the Company in industrial al flexibility and comprehensive cost advantage of the
collaboration and integration production capacity structure project.and quality equipment scale and costs accumulation of
process techniques speed of project operation and develop-
ment of the listed platform in the environment of high-quali- 3. Superiority in Market Competition Driven
ty competition of the whole industrial chain. by Advanced R&D
2. Comprehensive Operation Superiority The Company follows the development path laying equal
in Scale + Techniques + Support stress on market differentiation technology advancement
large-scale equipment and business integration upholds
the innovation mechanism based on market-technology
The Company keeps introducing world-class production interconnectivity creates internationalized R&D teams sets
equipment and mature technique packages for self-learning up high-level platforms for scientific and technological R&D
absorption and application and continuously engages in and that for innovation of new products has the ability
technology and technique innovation and upgrade. It has07to make quick response to the latest change of market machines with automatic machines” “replacing one machinedemand and has stable mid-to-high-level client resources. with a complete set of machines” and “replacing digitaliza-Four business entities under the Company i.e. Hengli Chem- tion with intelligentization” thus facilitating the gradual
ical Fiber Deli Chemical Fiber Hengke Advanced Materials transition from “strength in human resources” to “strength inand Kanghui New Material are all national high and new tech technology” in our development pattern. By means of the
businesses. Thanks to fine management and upgrading integrated application of intelligent manufacturing the
techniques in the production the Company has Internet the Internet of things and other technologies we
independently developed a series of differentiated and are constantly promoting the level of intelligent manufactur-
functional products based on research held patents of a ing throughout the entire process. Product traceability and
large number of products and won widespread market full-process control are realized through a self-developed
recognition. It enjoys superiority over peers in quality and product detection system automatic bar code system
stability of products as the only company in China with the intelligent warehouse management system and sales
capacity for mass production of 7D FDY products the system together with the seamless integration with the ERP
company covering more than 65% of the total output of system thus promoting the integration of key links such as
MLCC release liners in China and the first company in China corporate control R&D manufacturing business manage-
as well as the second in the world with the capacity for ment and financial connection facilitating the transition
on-site production of 12-nanometer silicon-coated release from “manufacturing” to “smart manufacturing” and
laminated protective films for lithium batteries. The absolute transforming from single business management to
technological superiority and technical experience in the highly-coordinated operation of the industrial chain.fields of functional films and PFY for civil use have put the 5. Continuously-accumulated Talent Management Advan-
Company in an invincible position in an industrial competi- tages
tion that is difficult to replicate in the short run. We have formed a multi-disciplinary and multi-profession
scientific and technological team including refining petro-
4. The Advantages of Smart Lean and chemical polymer materials chemical fiber engineering
Efficient Management textile engineering electrical engineering etc. Besides our
scientific research and development capabilities are ahead
of our domestic counterparts. While introducing externalWe are committed to promoting the idea of “deep integration talents we also attach great importance to the cultivation ofof the Internet big data Artificial Intelligence (AI) and the our internal talents at the same time by providing ourreal economy” by developing advanced manufacturing employees with a smooth career development channel. In
capacity and regenerating internal driving force. In achieving addition we have also established a complete internal
this goal we take the “intelligent interconnection” as a key training system and trained a large number of key personnel
starting point for industrial upgrading and transformation covering various aspects including R&D production sales
through “replacing humans with machines” “replacing management etc.Discussion and Analysis of Our Business PerformanceIn the first half of 2021 “The global epidemic still continues tary easing and economic stimulus in the short term. At theto evolve and the external environment becomes more same time the global gap in vaccine supply is intensifyingcomplex and severe.” Under the context of globally normal- the divergence between regulatory effectiveness and
ized epidemic prevention and control the world economy is economic development. Globally major developed econo-
slowly bottoming out and recovering amid the repeated mies and some emerging countries and regions are working
twists and turns of the epidemic the intensification of hard to accelerate the pace of COVID-19 vaccine R&D and
conflicts among major powers and the restructuring of vaccination coverage in an aim to win the tough fight
international supply and demand. With the continuation of against virus mutations. Looking forward to the second half
various stimulus policies the world economy has witnessed of the year from the perspective of the international environ-
a shortage economy in which a certain degree of demand ment it is expected that the production and consumption
grows faster than the supply recovery. However the ongoing demand in major global markets will still remain in the status
evolution of the current overseas epidemic situation has of gradual recovery and improvement under the accelerated
undoubtedly increased the uncertainty of the global popularization of vaccines and the stalemate situation of the
economic growth which may also make it difficult for epidemic control. Coupled with the impetus of the accelera-
countries to withdraw from targeted policies such as mone- tion of global material consumption demand stimulation and08
the repeated reflux of overseas trade orders enterprises in consumption recovery driven by steady domestic economic
the industry are facing interference factors including the growth. With the recovery of external demands and repeated
repeated external epidemic and complex trade environment. reflux of international orders due to vulnerable supply capac-
However based on the expectation and foundation for the ity resulted from the epidemic the prices and price differen-
overall improvement of global consumer demand and tials of main chemical products produced by upstream
efficient and stable domestic production capacity supply the refining coal-gasification and ethylene plants such as PX
enterprises in the industry are expected to maintain a sound pure benzene acetic acid polypropylene ethylene glycol
momentum of business development in the second half of styrene polyethylene butadiene etc. have generally
the year. maintained and kept fluctuating within a strong range thus
Domestically in 2020 and the first half of 2021 the targeted leading to stable profitability. Similar to upstream enterpris-
and efficient approach in epidemic prevention and control es downstream new chemical material products also
adopted by China has minimized the negative impact of the benefited from the increase of raw material costs and termi-
epidemic on the macroeconomy both at home and abroad nal demands recovery the profitability of polyester yarn for
thus the quality and level of domestic economic growth have civil use and polyester yarn for industrial use is rapidly return-
always maintained at the forefront among the world’s major ing to normal and functional thin films engineering plastics
economies. The steady growth of household consumption biodegradable materials and other under-supply materials
and the policy of “filling in the gaps in foreign demands” have maintained higher prices and greater profitability. In the
continue to play a prominent role as the “ballast” and “lubri- face of the turbulent external environment the integratedcant” of the economic growth. After realizing dynamic and operation of industrial chain with high value-added and
effective epidemic control in China domestic consumption diverse products and combined supply of products will be
has stabilized rapidly and turned for the better and the policy better prepared against an oil price decline and will show
of “tapping the potential of the domestic market” continues stronger profitability resilience when oil prices rise and
to be implemented all of which has become the leading demands restore which will stabilize and boost business
factor and driving force in boosting the domestic cycle and profitability to the maximum extent.offsetting the external fluctuations. Based on and promoted In addition to the impacts brought by the above-mentioned
by the huge growth of domestic consumption and the factors including crude oil and raw materials costs and
upgrading of consumption structure and with the accelerat- evolving traditional stock demands it should be highly
ed upgrading of China’s economic structure toward a new noticed that the demand and structure of advanced material
economy new driving forces new manufacturing and chemical products serving as an important pole of advanced
green low-carbon energy-efficient and environ- materials will benefit from and be boosted by new consump-
ment-friendly production and consumption the high-end tion and cutting-edge technology at an exponential speed
manufacturing and high-tech integration of the industrial after entering the “14th Five-Year Plan” period. And it is
chain composed of the scientific and technological innova- expected to develop and create more high value-added
tive industrial entities including the new energy 5G photo- advanced-material consumption and technology products
electric chips integrated circuits biotechnology industrial with large capacity within a foreseeable time based on local
Internet and artificial intelligence will usher in strong growth chemical advanced-material supply system such as new
in terms of consumption resilience and innovation vitality. biodegradable materials in the field of green consumption
“New consumption” and “cutting-edge technology” are semiconductor and optical film and functional membrane in
interacting with each other and moving towards further the field of consumer electronics lithium separator
development with great momentum in obvious trends which battery-grade DMC and PVDF materials in the field of new
will also outline the strategic direction for the future of the energy power battery EVA and POE film in the field of photo-
industry in terms of advanced production capacity layout voltaic module PBT ABS PC engineering plastics in the
and application scenario extension based on advanced field of new energy vehicle lightweight and charging pile.materials. The new market and new demands in the advanced material
Looking back at the industry against the backdrop of global- industry can achieve rapid growth with the explosively
ly normalized epidemic prevention businesses are not only growing demand of “new consumption” and “new manufac-faced with unexpected risks and challenges but are also turing” in the downstream. The potentially visible blue ocean
taking initiatives to turn risks into opportunities and has market will also become the strategic commanding heights
achieved stable operation and smooth production and for leading enterprises in the industry in future development
marketing based on a stable and efficient supply of industrial especially the high-end advanced material chemical import
chain products and market stability and flexibility. In the first substitution market which has been hampered by manyhalf of this year from the perspective of the overall internal bottlenecks. At the same time the “carbon peak and carbonand external environment the industry has benefited from neutrality” goal has also become important guidance and
the increase of the international crude oil price and terminal priority direction for enterprise business development. This09
goal includes not only accelerating the structural changes market of differentiated functional and high-end advanced
adapted to the residents’ consumer demand for low-carbon chemical materials will make a great difference.and environmental protection but also involves meeting the Back to the enterprise level during the 13th Five-Year Plan
material needs of the national industrial green transforma- period the main logic and driving force of our development
tion and upgrading as well as the optimization and adjust- were to base on the expansion and strengthening of down-
ment of the operation of the industry itself under the stream polyester advanced materials for a vertical and
“double-carbon” mode. These will promote the industry integrated breakthrough “from the bottom to the up” to
enterprises to actively transform from “energy + chemical break the monopoly and “bottleneck” of overseas productionindustry” to “platform-based + advanced materials” and from capacity on upstream raw materials like aromatics and“scale economy-led” to a “green cycle-driven” business olefins and upgrade to a platform of “major chemical” with
operation model. refining chemical and coal as industrial carriers and to the
It can be said that advanced materials as the “foundation” of upstream fields of strategic scarcity. Eventually we have
the manufacturing industry development are of major realized the comprehensive improvement in key production
strategic significance for promoting technological innova- capacity of the industry process equipment equipment
tion breaking through the “bottleneck” technology and intelligence and the integrated cooperation of industry.supply chain blockade maintaining the independent control- Entering the new period of the “14th Five-Year Plan” with the
lability of the industrial chain and supporting high-quality upstream breakthrough the leading enterprises have great-
development. Looking forward to the “14th Five-Year Plan” er operating content development space and growth possi-
the global advanced chemical material consumption indus- bility under the operation mode which allows in-depth
try especially this industry in China has enjoyed a extremely coordination and complementary operation between the
broad market and development potential. On the one hand platform of “major chemical” and the extension of advanced
unlike other material industries the core demand and materials throughout the whole industry chain. Meanwhile
ultimate driving force of advanced chemical material links faced with the exponential growth and huge gap in the
are seeking a more rigid and engaging residential terminal demand for advanced chemical materials caused by the
consumption field. During the “13th Five-Year Plan” period rapid development of “new consumption” and “Key&Corethe supply-side reform of the petrochemical industry in Technology” in the future we should make full use of the
China has achieved significant results the systematic continuous empowerment of the “major chemical” platform
optimization of the supply structure and the significant upstream and the accumulated development of advanced
downward shift of the cost curve have greatly promoted the materials downstream for the “top - bottom” development of
improvement of the quality and its category as well as the the new markets of downstream chemical materials whichefficiency and cost of the range economy. Facing the “new will become the historical mission and core driving force forconsumption” area the continuous upgrading of the supply the development of industrial enterprises in the next five or
structure and the continuous improvement of the additional even ten years and is expected to promote leading enter-
consumption is implemented to drive the expansion of the prises’ chemical-materials-based building of industrial chain
social demand value and the total capacity. In this way it has and the improvement of scarce production capacity so as to
become the theme of new supply and demand trends adapt- serve the country in upgrading advanced manufacturing and
ing to high technology high added value low carbon consumption to achieve an explosive breakthrough and a
environmental protection and individualized customization “secondary growth curve” of long-term development under
and promote the market research and development of the effect of core technology manufacturing technology and
modification and application in advanced chemical materials large-scale overwhelmingness.for new consumption scenes in the future. On the other “The advanced materials industry is not only a strategic andhand as the global industrial sectors in new energy basic industry but also a key area of high-tech competition.semiconductors 5G intelligentization and other new We must work hard to catch up.” Undergoing profoundtechnologies and new manufacturing production scenarios changes unseen in a century “scientific and technologicalaccelerate their transfer to China or take China as the core self-reliance and self-improvement” has become the subject
market for further development the development momen- of the times calling for great breakthroughs and great devel-
tum and scale capacity of the high-end fine chemicals and opment of sci-tech innovative enterprises. Hengli Petro-
advanced chemical materials market for industrial manufac- chemical is a private advanced materials enterprise that has
turing are also expected to continue to increase and expand fought and honed all the way from downstream despite thealong with the acceleration of the implementation of “carbon fierce market competition. Beginning with the downstreampeak and carbon neutrality” industrial upgrading infrastruc- polyester advanced materials industry Hengli climbed
ture transformation and changes in the consumption vertically along the petrochemical industry chain and broke
structure. In this sense driven by scientific and technological through the upstream development bottleneck one after
innovation and technological R&D the industrial application another to acquire a systematic industrial pattern of both10
“major chemical” platform and “advanced materials exten- the other hand through refinement and strengthening thesion”. When dealing with the reform and upgrading of downstream we focus on specific technological R&D lines
consumption structure and industrial system Hengli also has with more unique skills leading products and professional
a more unique and comprehensive advantage of platform fields so as to achieve efficient penetration and deep
integration and industry-driven ability. After strategically connection from raw materials to processes and to the
completing the key production capacity in the last round of market. Aiming at the new application direction and new
“major chemical” platform the listed company took advan- market of polyester and polyester-like products downstream
tage of the further optimization and consolidation of the of aromatics as well as fine chemicals and special advanced
production capacity in the midstream and downstream. Now materials downstream of olefins so as to consolidate theentering the new development period of the “14th Five-Year advantages of the traditional market. At the same time wePlan” with questions like how to rely on the advantages of should focus on the key advanced materials and fields that
the upstream platform to deeply tap the potential of have breakthroughs due to the development and upgrading
advanced materials how to further expand the leading of “new consumption” and “Key&Core Technology” andadvantage of the competitiveness in the whole industry “look for opportunities and driving forces for developmentchain how to further enhance the benefits of large-scale from green development”. We will actively embrace and help
integration and the added value of product technology as our country in its goal of peaking carbon dioxide emissions
well as how to further deepen and broaden the strong moat and achieving carbon neutrality and adhere to the path ofbuilt by technology cost management efficiency and “participating in the industries we understand developinginnovation the strategic choice of “improving the upstream the industries we are familiar with and keeping growingwhile strengthening the downstream” has become inevita- strong bigger and better in the professional field.” Through
ble. active measures including external introduction joint R&D
On the one hand by expanding and improving the industrial joint venture and cooperation and internal innovation we
layout in the midstream and upstream we will further use the will continue to develop advanced materials business growth
industrial support and basic role played by the high-end points with advantages of scale and leading levels so as tochemical raw materials to actively “complement and ensure that every project and industry developed by Henglistrengthen the chain” with “R&D innovation” while constant- should become a global benchmark and the best of thely guarantee the platform function and operation efficiency industry and ensure that we will not lag behind in the next
of the “major chemical” industry upstream to reserve space decade or more. with our continuous pace towards an enter-
and pave a path for the continuous expansion of various prise with the world-class platform of advanced chemical
advanced materials business downstream in the future. On materials R&D and manufacturing.During the reporting period the key tasks of listed companies are as follows:
First continuously strengthening the support and develop- capacity clusters: refining and chemical integration project
ment function of the upstream “major chemical” platform at a capacity of 20 million tonnes/year modern coal chemi-
with “refining + ethylene + coalification” as the carrier to cal plant at a capacity of 5 million tonnes/year world's
make full use of the advantages of systematic coupling and largest single ethylene project at a capacity of 1.5 million
complete raw material resources produced by the integra- tonnes/year and 5 sets of industry's largest single PTA plant
tion of oil coal and chemical while speeding up the with a total capacity of 11.6 million tonnes/year. In this way
construction of advanced materials supporting projects for we have successfully broken through the “bottleneck” in
Hengli as well as the planning and improvement of the deep business links and raw material supply in the upstream and
processing and radiation capacity of advanced materials in formed a strategic support platform of “major chemical” withthe C2-C4 olefin industry chain. a combination of “world-class chemical refineries + moderncoal chemical plants” and integration of oil coal and chemi-
1. The current development of the cal. Meanwhile as the listed companies have 100%
upstream “major chemical” platform: wholly-owned shares in both Hengli Refining and Hengli
Chemical our refining and chemical integration project is the
since 2010 through forward-looking plans and high only self-built private wholly-owned project in the industry.standards we have worked hard for ten years to increase our Owning 100% of the equity and production capacity
strength. In Dalian Changxing Island Petrochemical Industrial guarantees that the profits of our refining ethylene and coal
Park one of the top seven petrochemical industrial parks in chemical businesses and the output of important chemical
China we have concentrated and efficiently built four major raw materials can all be owned by listed companies and11
shareholders. This effectively ensures the profitability of advanced materials industry chains downstream. At the
listed companies and the ability to control the upstream same time we were fully equipped with the industry’s top
“major chemical” development platform. 520MW high-power self-provided power plant (providing a
At present the business plate of listed companies in the large amount of low-cost electricity and steam for self-use)
midstream and upstream has been built with a processing self-provided crude oil terminal (2 terminals at a handling
capacity of 20 million tonnes of crude oil and 5 million capacity of 300000 tonnes) the country’s largest refinery
tonnes of raw coal. The main production is: in the aromatics self-provided crude oil tank area (storage capacity of 6
process an annual output of 4.5 million tonnes of PX 1.2 million-tonne crude oil) and other utilities including finished
million tonnes of pure benzene and 16.6 million tonnes of raw material terminal and tank area storage which greatly
PTA (of which 5 million tonnes come from the Huizhou base reduces the production and operation costs. The refining
which is under construction); in the olefin process annual and chemical plant coal chemical plant ethylene plant
production of 1.8 million tonnes of fiber-grade ethylene and PTA plant in Changxing Island base are all connected
glycol 850000 tonnes of polypropylene 720000 tonnes through the pipeline which saves a lot of intermediate
of styrene 400000 tonnes of high-density polyethylene costs and transportation costs forming a business strate-
and 140 000 tonnes of butadiene; and in the coal chemical gic layout of the world-class petrochemical industry devel-
process an annual output of 750000 tonnes of methanol opment platform and a combination of matching integrat-
400000 tonnes of acetic acid 300000 tonnes of pure ed capacity and top-equipped utility. This also lays a solid
hydrogen and 126000 tonnes of liquid nitrogen. We have foundation of raw materials and industrial supporting
reserved and transported high-end chemicals that are high conditions for us to further develop the advanced chemical
value-added and domestically scarce as well as midstream materials business downstream of aromatics and olefins
and upstream raw materials and additional gases to the with scale advantages and market potential.2. Speeding up the construction of Hengli dioxide. The core product of this project is the annual
Chemical’s advanced materials support- production capacity of 300000 tonnes of adipic acid whiching projects: will further smooth out and improve our whole industry chain of degradable advanced materials of “crude oil - PTA adipicacid - PBAT”. Adipic acid is also an important raw material for
we have started the construction of the advanced materials the production of nylon 66. We will also purify the carbon
supporting project of Hengli Chemical in Dalian Changxing dioxide exhaust gas of concentration higher than 95%
Island with a total investment of 2.31 billion yuan. Reducing emitted by low-temperature methanol washing equipment to
the investment cost through sharing the utilities in the 99.99% food grade. This not only recovers carbon dioxide
refining and chemical park we used pure benzene hydro- an industrial waste gas but also increases our benefits. This
gen nitrogen and carbon dioxide produced by our refining advanced material supporting project makes full use of the
ethylene and coal chemical plants as the main raw materials raw material resources provided by the upstream to further
to produce products like adipic acid and food-grade carbon add and optimize the raw material supply structure of the12
“major chemical” platform enhancing our products’ output in the current domestic storage facilities resulting from
value and added value. The project also further improves our Hengli fully taking advantage of its integrated large-scale
whole industry chain business system. This project marks a one-stop chemical processing production process.substantial and important step for listed companies towards Hengli’s ethylene downstream is currently dominated by bulk
refining and chemical industry fine chemicals downstream of chemical raw material products such as polypropylene
olefins and deep processing of advanced materials industry. polyethylene ethylene glycol styrene monomer and butadi-
ene providing the potential and the industrial basis for more
3. Improving the C2 - C4 deep processing diverse downstream chemicals production and the advance-
chain: ments of advanced chemical materials and products. The
newly-built Hengli Advanced Materials Project with an
annual output of 300000 tonnes of adipic acid is another
in addition to the PX benzene and part of polypropylene practical deployment to build the “major chemical” platform.produced from improved processes and hybrid dehydroge- Moving forward Hengli will continue to rely on its existing
nation facility the company’s production of the main upper raw material processing assets outsourced resources and
stream raw materials and production output were from the equipment optimization potentials while emphasizing our
1.5 million-tonne ethylene pipeline. The ethylene processing advanced material businesses which have shown scaling
cluster includes a 1.5 million tonnes/year steam cracker a advantages and leadership positions in the industry. Our
400000 tonnes/year high-density polyethylene (HDPE) target will be the key advanced materials focusing on devel-
plant 2 200000 tonnes/year polypropylene (PP) plants a oping and upgrading “new consumption” and “cutting-edge720000 tonnes/year styrene monomer (SM) plant 2 technology”. The plan is to permeate the high-growth and
900000 tonnes/year ethylene glycol (EG) plants a 140000 high-potential advanced material verticals such as the
tonnes/year butadiene extraction unit a 350000 tonnes/- degradable advanced materials lithium-ion batteries photo-
year pyrolysis gasoline hydrogenation unit and a 170000 voltaics and new engineering plastics. We will continue to
tonnes/year C4 hydrogenation plant. These facilities were upgrade our systems and carry out the technical transforma-
built with equipment from the world’s top three suppliers tion process optimization and advanced processing equip-
with some of the industry’s best unit investment costs and ment construction to improve our C2 - C4 ethylene line
processing and operating costs. The steam cracker plant including downstream polystyrene (PS) production capacity
uses the pipeline from Technip S&W the EG plant adopted of SM acrylonitrile production capacity downstream of PP
technology from SD the HDPE uses the Lyondell Basel ABS capacity through styrene monomer and butadiene
(Germany) process and Badger provides the SM facility downstream battery-grade dimethyl carbonate (DMC)
technology. The technology providers are either global phenol acetone and bisphenol A production capacity of
leaders or newcomers with significant catch-up potential. propylene ethylene oxide methanol and benzene and
Over 98% of raw materials related to the ethylene unit were further downstream polycarbonate (PC) capacity as well as
supplied by the upstream refining and chemical plant full the capacity of polyether polyol (EO/PO polyether) produc-
use of the diversified high-quality ethylene provided by the tion. The “major chemical” platform will continuously invigo-
refinery through dry gaseous ethane cracking LPG crack- rate and support the downstream advanced material indus-
ing and precision naphtha cracking. The designed yield of try chain through these strategies.diene is 48% and diene 60%. These yields are the highest
POY
PX PTA PET Polyester“High-EndFibre FDY Polyester”
Aromatic DTY Industrial Chain
Hydrocarbon
Sector Online Coating Si-containing “Lithium Battery”
Petrobenzene Lithium-ion Battery Protective Film Industrial Chain
MLCC Release Film
BOPET Film
Crude Ethylene Optica Film
Oil Propylene PBT Engineering “Photovoltaic” Alkene Butadiene Plastics Photovoltaic Membrane Industrial Chain
Compound Ethylene glycol PBAT Biodegradable Plastic “Biodegradable Plastics”
Sector Polyethylene Industrial Chain
Polypropylene The existing industrial chain of advanced chemical materials relies on the “major chemical” platform
Propylene Lithium Electricity Film “Lithium Battery”
Isobutylene DMC Industrial Chain
Dehydroge- Polypropylene Acetone
nation MTBE Bisphenol A PCIsooctan Phenol Formaldehyd Polyoxymethylene “EngineeringRaw Adipic Acid Nylon 66 Plastics” IndustrialCoal Chemical Methanol HexamethylenediaminCoal Industry Acetic Acid ABS
Sector Hydrogen Acrylonitril
Oxygen Nitrogen Polyether Polyols “Polyurethane” Epoxy Ethane
Syngas Polymer Polyol Industrial Chain
Epoxy Propane
The existing “major chemical” platform provides a rich The industrial chain of high-end advanced chemical materials is planned and laid out relying on
“chemical raw materials database”. the platform of “major chemical” platform13
Second Hengli continues to expand deepen and refine its At the same time the Hengke started construction on the
downstream advanced chemical material business with the new Jiangsu Xuanda Green Multifunctional Advanced
support of the upstream “major chemical” platform and Textile Materials Project (Hengke Phase III) with a capacity
Hengli’s “innovative R&D Gene” which provides the group of 1.5 million tonnes. Located in Nantong Jiangsu the
with the necessary speed and efficiency. At the same time project accrued a total investment of 9 billion yuan. Main
we continue to improve the R&D wing of the company’s project capacity includes 150000 tonnes of new elastic
downstream sectors and carried out horizontal expansions fibers 150000 tonnes of environment-friendly fiber
into new technologies new processes and new products 300000 tonnes of cationic POY 300000 tonnes of
leveraging existing similar productions. For Hengli the full-dull POY and 600000 tonnes of differential fiber
current downstream advanced material sector is mainly (300000 tonnes/year POY 300000 tonnes/year FDY).distributed in high R&D businesses such as differentiated After completed the project will bring more advanced
polyester fibers functional polymer thins engineering technology and added value to our home-use business
plastics and PBS/PBAT biodegradable advanced materi- arsenal further enhancing our listed subsidiary’s presence.als. With its upstream platform and downstream stock In addition the new production capacity of 1.2 million
Hengli targets the ever-growing demands in the advanced tonnes of textile yarns in Deli Phase II and 1.4 million tonnes
consumption and technological material markets showing of industrial yarns in the Suzhou headquarters are also in
great potential for scaled production and high-end differen- their planning phase and will start construction pending
tiation. Hengli is bringing its existing rapid and efficient government approval and other related preparatory condi-
processes and product development models into the tions.advanced material vertices to permeate these markets. To In polyester yarn for civil use and for industrial use Hengli is
this end we have already established three major materials currently the only Chinese producer that can mass-pro-
research institutes: the Fiber Research Institute Petro- duce FDY products of 7D or below. In the R&D of microfiber
chemical Research Institute and Advanced Materials the company has been at the forefront of the industry.Research Institute dedicated to the R&D and the business During this reporting period Deli Chemical Fiber began
expansion of our advanced chemical materials products. mass production of ultrafine 0.2 denier (D) monofilament
with the specification of 15D/72f ranking it one of the
1. The differential polyester fiber sector: finest mass-produced ultrafine fibers in China. The
high-density fabric ultrafine fiber 5D/6f independently
Our subsidiary companies Hengli Chemical Fiber Deli developed by the Hengke Advanced Materials has China’s
Chemical Fiber and Hengke Advanced Materials are the smallest total linear density suited for the IT industry such
main producers of our polyester fiber business (home-use as mobile circuit boards and electromagnetic waves shield-
PET fiber and industrial PET fiber). These subsidiaries are ing fabrics. Hengli Chemical Fiber’s 200000 tonnes/year
national high-tech companies with solid technical support industrial fiber project demonstrates that Hengli’s research
rich talent pools and market reserves. The Hengke is transformed into major high-tech production. The project
currently building a phase II textile yarn project with a 1.35 has been put into full production for the first time allowing
million tonne capacity. A 600000 tonne PET Resin facility specialized downstream industry such as oil and gas explo-
was added to the project in the second half of last year and ration and offshore engineering to use domestically
its downstream fiber spinning facility was completed in the produced fibers effectively breaking the industry technolo-
first half of this year increasing 250000 tonnes of DTY gy monopoly and the “choke-hold” of key technologies in
capacity and 350000 tonnes of POY capacity. high-performance industrial yarn14
2. The functional polyester films and engi- oped using independent IP and was put into operation at
neering plastics sectors: the end of last year reaching full production early this year.The PBAT production is recyclable easily recoverable
The company’s wholly-owned subsidiary Kanghui New non-toxic and highly stable and is suitable for the applica-
Material is the main producer of differentiated and tion to fill the supply gap in domestically produced degrad-
high-performance polyester films with environment-friend- able food-grade products.ly nature and new plastic materials of the group and a Kanghui’s presence covers the industrial chain and employs a
national high-tech enterprise. Through nearly a decade’s highly professional R&D team aiding the company to
research and rapid development Kanghui has improved its overcome various technical challenges. From the perspective
industrial competitiveness in mid-to-high-end functional of market segmentation Kanghui has become the largest
polyester films and advanced plastic materials and is now domestic manufacturer of mid-to-high-end MLCC release
ranked among China’s first-class level. At present Kanghui base film with a domestic market share of over 65%. It
has an annual production capacity of 240000 tonnes in has broken foreign monopoly and filled the gap in the
PBT engineering plastics at its Yingkou Base making it the market. Its products have been exported to Japan South
largest PBT manufacturer in China. Its PBT is mainly used Korea and other high-end overseas markets. Kanghui’s
for auto parts polymer alloys optical cable protective high-smooth MLCC release base film has been mass-pro-
sleeves electronic appliances and other industrial duced and the ultra-smooth MLCC release base film
applications. It has a capacity of 266000 tonnes of process has been finalized. Kanghui has also received
BOPET functional polyester films and it is committed to certification from Japanese and South Korean authorities
fulfilling functions such as electronic and electrical film and small batch production has begun. The ultra-smooth
substrates environment-friendly new energy substrates MLCC release base film has passed the technical verifica-
and precision inline coating products. Kanghui plans to tion of Japanese and South Korean authorities and will
launch three film production lines into operation by the end reach mass production quickly. Additionally Kanghui is the
of this year which will increase its capacity to 385000 only company in China and the second in the world achiev-
tonnes. Kanghui has the largest domestic PBAT annual ing inline production of the 12μm silicon-coated release
production capacity of 33000 tonnes by single set devel- laminated aluminum film for lithium batteries.Kanghui New Planed Panoramic of the Kanghui New
Material (Yingkou) Industrial Park Material (Fenhu) Industrial Park15
In addition to the Yingkou base Kanghui New Materials is tonnes of high-end functional polyester film 100000
speeding up its overall design and construction of the tonnes of special available polyester films 150000 tonnes
Fenhu base and Kunshan base in Suzhou Jiangsu of modified PBT and 80000 tonnes of modified PBAT.Province. Once the above two bases are fully put into For the 470000 tonnes of high-end functional polyester
production it is equivalent to the capacity of two upgraded film thickness specifications span 2um to 350um and is
Kanghui. The company will also become the world’s largest suited for general use in electronic and electrical equip-
production base for functional polyester films functional ment (125000 tonnes) products include electrical insula-
plastics and biodegradable advanced materials. In tion film release film inline silicone coated release film
response to the rapid growth of domestic environ- capacitor film electronic tape Film and switch film; optical
ment-friendly consumption and advanced manufacturing materials (76000 tonnes) including products of film for
market for functional polyester films Kanghui and the X-ray OCA release base film AB adhesive main film
German Brückner Group lately signed a contract to reflective film diffusion film brightness enhancement film
together build 24 of the most advanced functional polymer hardened film explosion-proof film polarizing film
thin film production lines with an annual output of more flat-panel display protective film and optical adhesive/-
than 800000 tonnes in the Fenhu and Kunshan bases sticker/hot melt adhesive protective film.; information
respectively; Kanghui also signed contracts with Barmag technology (76000 tonnes) including products of
Huitong and SUMEC Juyou to build plants capable of electronic shelf label film ceramic capacitor film ITO film
producing 900000 tonnes of biodegradable plastics high integrated circuit board photosensitive dry film and
which will be constructed in the Changxing Island and antistatic film.; new decoration (82000 tonnes) including
Yingkou bases; and Kanghui invested greatly in the R&D of products of bronzing transfer film laser film reflective film
PBT/PET/PBAT plastics modification and began to build gold wire drawing film steel film matte film and colored
four pilot modification production lines to strengthen film.; new energy vehicles (41000 tonnes) including
further the R&D capabilities of material modification based products of lithium battery protective film glass window
on the masterbatch base film and Steel Sections. film and anti-fog film.; packaging materials (70000
At present Hengli has launched a 450000-tonne PBS tonnes) including products of aluminized film aluminized
biodegradable plastic project of Kanghui Dalian New Mate- reinforced film printed packaging film reinforced film
rial following previous overall corporation production transparent vapor deposition film twist wrap film heat
capacity plans. The project is built on Changxing Island shrinkable film card protection film medicine coating film
Dalian. With a total investment of 1.798 billion yuan the and TTR film.project features 450000 tonnes of PBS/PBAT degradable The 100000-tonne special functional polyester films
advanced material capacity. The project will expand the use offline coating technology to modify the surface of
capacity and scale of the company’s biodegradable the base film to introduce special functions. The prod-
advanced material sector and increase the market share of ucts mainly include functional polyester film tempera-biodegradable plastics. In addition under the “carbon peak ture-resistant lithium battery separator film and photo-and carbon neutrality” goal new energy materials will be voltaic backsheet film. The 150000-tonne modified PBT
an important part of the extended industrial chain. The is mainly used in the automobile manufacturing field
company is exploring the demand-depth of the alternative including carburetor components distributors ignitor
energy sector for advanced chemical materials. It has coil frames insulating covers bumpers instrument
already rapidly deployed the Lithium-ion battery separator panels and clutch pedals; electronic and electrical field
film business based on the strategic support of its chemi- including connectors transformer frames household
cal platform and years of accumulation in the downstream appliances and energy-saving lamps; industrial machin-
high-end membrane market. The company is currently ery field including transmission gears mechanical
preparing to construct new Lithium-ion battery separator parts shaft sleeves motor end covers and outdoor
films including separator films equipment purchase nego- fitness equipment. The 80000 tonnes of modified PBAT
tiations and core talent recruitment. The goal is to proceed is made from self-produced PBAT resin natural starch
with the highly efficient “Hengli speed”. and calcium carbonate through proprietary starch plasti-
The company also started constructing the Jiangsu Kang- cization technology inorganic powder dispersion treat-
hui New Material Project with an annual output of 800000 ment and customized blending and melting twin-screw
tonnes of functional polyester thin films and functional extrusion line modification. It is mainly used in biode-
engineering plastics. The construction site Fenhu of Jiang- gradable plastic bags biodegradable glue biodegrad-
su is in the Yangtze River Delta Eco-Green Integrated able melt-blown materials 3D printing consumables
Development Demonstration Zone. The total investment is cigarette pack materials foam materials biodegradable
11.12 billion yuan. The construction includes 470000 agricultural films and other fields.16
In this report the terms listed below are defined as follows unless the context otherwise implies:
1. Main Business Analysis
Changes of Accounts from Financial Statements
Unit: 10000 yuan Currency: CNY
Amount for the Amount for the same
Account Item period of the Flux (%)
reporting period previous year
Revenue 10457447.80 6735793.52 55.25
Cost of sales 8860615.70 5425672.64 63.31
Selling expenses 11215.58 54258.71 -79.33
Administrative
expenses 92987.70 87069.26 6.80
Financial expenses 285675.24 282004.12 1.30
R&D expenses 42300.52 37909.88 11.58
Net cash flow from
operating activities 1618009.23 1819232.26 --11.06
Net cash flow from
investing activities -573639.45 -2048216.71 N/A
Net cash flow from
financing activities -870173.24 639647.14 -236.04
Explanation of the reasons for changes in revenue:
revenue increase was primarily due to target output reached by the 1.5 million-tonne ethylene project and 2*2.5
million-tonne PTA project of Hengli Petrochemical in the middle and the second half of 2020
Explanation of the reasons for changes in cost of sales:
the increase was primarily due to the comparable increase in revenue
Explanation of the reasons for changes in selling expenses:
the change was primarily due to the accounting transfer of transportation expenses into cost of sales
Explanation of the reasons for changes in administrative expenses:
no big changes compared with the same period of last year
Explanation of the reasons for changes in financial expenses:
the change was primarily due to increase in interest expenses
Explanation of the reasons for changes in R&D expenses:
the change was primarily due to the Company’s increasing investments in R&D
Explanation of the reasons for changes in net cash flow from operating activities:
value-added tax consumption tax and corporate income tax all increased during the reporting period due to
increase in revenue; other cash paid relating to operating activities also increased
Explanation of the reasons for changes in net cash flow from investing activities:
cash paid to acquire long-term assets decreased significantly during the reporting period
Explanation of the reasons for changes in net cash flow from financing activities:
cash repayment of debts increased significantly during the reporting period17
2. Assets and Liabilities Analysis
Asset and Liabilities
Unit: yuan
Percentage
of amount at Percentage of
the end of percentage of
Amount at the
Amount at the the report-
Amount at the end
end of the
ing period in of the same period Account Item Explanationsend of the same period of of last year in total Flux (%)
reporting period total assets the previous
in the assets in the same
year
reporting period of last year
period (%) (%)
Primarily due to decreasing accounts receivable balance from
Accounts receivable 416922134.69 0.21 1363602415.10 0.71 -69.42 customers with high credit rating by the end of the reporting
period
Primarily due to increasing raw materials and finished goods at
Inventories 26547232372.12 13.21 19691123430.81 10.31 34.82 the end of the reporting period to address increasing sales during
the reporting period
Construction in 6145331822.15 3.06 4195710084.65 2.20 46.47 Primarily due to the new auxiliary building project of Hengli
progress Refining
According to the newly implemented lease accounting standards
Right-of-use asset 728965845.32 0.36 the new account of right-of-use asset is used to recognize the
original price of the right-of-use assets held by the lessee
Contract liabilities 8695979681.75 4.33 5401458679.01 2.83 60.99 Primarily due to increase in revenues received in advance
According to the newly implemented lease accounting standards
Lease liabilities 89789811.14 0.04 0.00 the new account of lease liabilities is used to recognize the
amount of lease payments outstanding from the lessee
Margin receivable 377707343.81 0.19 0.00 Primarily due to the new futures brokerage business during the reporting period
Trading financial 685929126.58 0.34 1650130008.46 0.86 -58.43 Primarily due to decreases in bank wealth management products
assets and structural deposits held by the end of the reporting period18
Settlement
guarantee fund 10050136.79 0.01 0.00 Primarily due to new futures related business during the
receivable reporting period
Advance payment 3591094480.71 1.79 1994374678.13 1.04 80.06 Primarily due to increases in advance payment for material purchases by the end of the reporting period
1287875315.02 0.64 803130210.03 0.42 60.36 Primarily due to increases in futures margin by the end of the Other receivables reporting period
Goodwill 79830909.39 0.04 0.00 Due to goodwill by premiums paid to acquire Hengli Futures
Deferred income 178101446.15 0.09 109496755.14 0.06 62.65 Primarily due to increases in deductible temporary differenc-tax assets es by the end of the reporting period
Margin payable 519032545.13 0.26 0.00 Due to the new futures brokerage business during the reporting period
Trading financial
liabilities 329312832.40 0.16 88999293.44 0.05 270.02
Primarily due to increases in losses from crude oil futures
contracts held by the end of the reporting period
Notes payable Primarily due to increases in letters of credit issued by the end 11376562617.86 5.66 7805074070.85 4.09 45.76 of the reporting period
Hengli Group issued exchangeable corporate bonds; the
Other payables 8176832270.88 4.07 416688235.50 0.22 1862.34 Company borrowed funds raised from the issuance from Hengli Group to repay interest-bearing debts; this was in line
with the use purpose of the funds raised
Other current Primarily due to increases in pending output tax by the end of
liabilities 1112797638.72 0.55 719118891.93 0.38 54.74 the reporting period
According to the newly implemented lease accounting
Long-term 4000000.00 0.00 123322260.33 0.06 -96.76 standards outstanding lease payments from the lessee are
payable recognized in the lease liabilities account
Deferred income 2356307.17 0.00 9240902.12 0.00 -74.50 Primarily due to decreases in taxable temporary differences by tax liabilities the end of the reporting period
Other comprehen- -174801353.83 -0.09 -100823962.53 -0.05 N/A Primarily due to cash flow hedging reserve after the settlement of sive income the hedging business in the beginning of the reporting period
Special reserve 50131635.93 0.02 77581307.23 0.04 -35.38 Primarily due to increases in costs of safety production during the reporting period
Asset size
Of which: overseas asset 1111627.66 (Unit: 10000 yuan Currency: RMB) accounting for 5.53% of the total assets.19
3. Assets with restrictions by the end of the reporting period
Item Closing Book Reasons for Restrictions
Value (yuan)
Cash and cash The Company pledged cash and cash equivalent in
equivalent 5812604555.57 order to obtain line of credit from financial institutions
Cash and cash The Company pledged cash and cash equivalent in
equivalent 186380794.90 order to develop futures business
Cash and cash The Company pledged cash and cash equivalent in
equivalent 19938262.80 order to invest in derivative financial instruments
Accounts receivable The Company pledged notes receivable in order to
financing 706815436.22 obtain line of credit from financial institutions
Fixed assets The Company mortgaged fixed assets in order to 93427684296.261 obtain line of credit from financial institutions
Right-of-use assets Fixed assets obtained by the Company through lease666726906.13
Intangible assets 3544743915.42 The Company mortgaged intangible assets in order to obtain line of credit from financial institutions
Construction in 224866998.61 The Company mortgaged construction in process in
process order to obtain line of credit from financial institutions
4. Investment Status Analysis
General Analysis on Foreign Equity Investment
(1)Significant Non-equity Investment
During the reporting period major projects invested by the Company are as follows:
1.The 1.5 million-tonne per year green multifunctional textile advanced materials project of Jiangsu Xuanda Polymer
Materials Co. Ltd.Total investment reached 9000 million yuan. The project is located in the Hengli Textile Advanced Materials Indus-
trial Park in the New Binjiang Area (Wujie County) Tongzhou District Nantong City with a construction period of 2
years. According to the feasibility study report the project is expected to realize annual revenue of approximately
18618.87 million yuan with an annual net profit of approximately 1300.27 million yuan after it reaches the target
output.2.The PBS biodegradable plastics project with 450000-tonne annual output of Kanghui Dalian New Material Tech-
nology Co. Ltd.Total investment reached 1798.21 million yuan. The project is located in the western Industrial Zone of Dalian
Changxing Island Economic and Technological Development Zone with a construction period of 1 year. According
to the feasibility study report the project is expected to realize annual revenue of approximately 10058.18 million
yuan with an annual net profit of approximately 2016.4 million yuan after it reaches the target output.3.The functional polyester film and functional plastics project with 800000-tonne annual output of Jiangsu Kang-
hui New Material Technology Co. Ltd.Total investment reached 11124.52 million yuan. The project is located in the factories of Jiangsu Kangkui New
Materials Technology Co. Ltd. in the demonstration zone of green and integrated ecological development of the20
Yangtze River Delta with a construction period of 32 months. According to the feasibility study report the project
is expected to realize annual revenue of approximately 14505.1 million yuan with an annual net profit of approxi-
mately 2906.32 million yuan after it reaches the target output.4.The advanced material supporting chemical project of Hengli Petrochemical (Dalian) Chemical Co. Ltd.Total investment reached 2130.92 million yuan. The project is the industrial park of Hengli Petrochemical (Dalian)
in Dalian Changxing Island with a construction period of 3 years. According to the feasibility study report the
project is expected to realize annual revenue of approximately 3517.8674 million yuan with an annual net profit of
approximately 1261.1812 million yuan after it reaches the target output.
(2)Financial Assets Measured at Fair Value
Unit: yuan
Item Beginning balance Ending balance
Derivative financial assets
361733852.02 598703897.92
Derivative financial liabilities
88999293.44 329312832.40
Bank wealth management
products and structural deposits 1288396156.44 87225228.66
Accounts receivable
financing 4082386076.60 2209137772.55
(3) Analysis of Major Holding and Participating Companies
Unit: 100 million yuan
Closing Closing Closing Closing Closing Closing Closing
Book Value Book Value Book Value Book Value Book Value Book Value Book Value
(yuan) (yuan) (yuan) (yuan) (yuan) (yuan) (yuan)
Hengli Petrochemical
(Dalian) Refining Co. Ltd. 100 Manufacturing 175.96 1192.10 322.35 52.42
Hengli Petrochemical
(Dalian) Co. Ltd. 99.83 Manufacturing 58.9 58.9 123.78 -2.87
Hengli Petrochemical
(Dalian) Chemical Co. Ltd. 100 Manufacturing 41.7 41.7 69.84 14.81
Jiangsu Hengli Chemical
Fiber Co. Ltd. 99.99 Manufacturing 22.08 22.08 58.71 11.01
Kanghui New Material
Technology Co. Ltd. 100 Manufacturing 8.31 8.31 25.08 7.3421
Note: Hengli Petrochemical (Dalian) Refining Co. Ltd. includes its subsidiaries of Shenzhen Shengang Trading
Co. Ltd. Hengli Petrochemical International Pte. Ltd. Hengli Oilchem Pte. Ltd. Hengli Refining Products Sales
(Dalian) Co. Ltd. Hengli Aviation Oil Co. Ltd. Hengli Shipping International Pte. Ltd. Hengli Offshore Oil Petro-
chemical Co. Ltd. Hengli Energy (Jiangsu) Co. Ltd. Hengli Energy (Suzhou) Co. Ltd. Hengli Oilchem (Suzhou)
Co. Ltd. Hengli Logistics (Dalian) Co. Ltd. Hengli Energy (Hainan) Co. Ltd. Hengli Oilchem (Hainan) Co. Ltd.Nanjing subsidiary of Hengli Oilchem (Hainan) Co. Ltd.Hengli Petrochemical (Dalian) Co. Ltd. includes its subsidiaries of Hengli Shipping (Dalian) Co. Ltd. Hengli Petro-
chemical Co. Limited and Shenzhen Ganghui Trading Co. Ltd.Hengli Petrochemical (Dalian) Chemical Co. Ltd. includes its subsidiary of Hengli Petrochemical (Dalian) Ad-
vanced Materials Technology Co. Ltd.Jiangsu Hengli Chemical Fiber Co. Ltd. includes its subsidiaries of Jiangsu Hengke Advanced Materials Co. Ltd.Nantong Teng’ an Logistics Co. Ltd. Jiangsu Xuanda Polymer Materials Co. Ltd. Jiangsu Deli Chemical Fiber
Co. Ltd. Suqian Deya Advanced Materials Co. Ltd. Hengli Futures Co. Ltd. Suzhou Susheng Thermal Power
Co. Ltd. Suzhou Deya Textile Co. Ltd. Suzhou Binglin Trading Co. Ltd. Sichuan Hengli Advanced Materials Co.Ltd. and Hengli Advanced Materials (Suqian) Co. Ltd.Kanghui New Material Technology Co. Ltd. includes its subsidiaries of Lijin (Suzhou) Trading Co. Ltd. Suqian
Kangkui New Material Co. Ltd. Jiangsu Kanghui New Material Technology Co. Ltd. Kangkui Kunshan New Mate-
rial Technology Co. Ltd. and Kangkui Dalian New Material Technology Co. Ltd.Potential Risks
1. Risk of industry cyclical fluctuations
The development of the polyester fiber and petrochemical industry is influenced by industry demands and its own
development status thus featuring a certain level of cyclicity. Changes of the macro environment such as China’s
national economy and export policy would bring risks of cyclical fluctuations to the industry. During adjustment
cycles falling product prices insufficient utilization of capacity and decreasing profitability would occur.2. Risk of raw material price fluctuations
The Company’s production and operation are greatly affected by the price changes of upstream raw materials
especially crude oil and coal. If the Company’s inventory and procurement management and price adjustment of
downstream product market cannot effectively reduce or absorb the impact of price fluctuations of raw materials
the Company's operation production and business performance could be adversely impacted.3. Foreign exchange risk
If the RMB continues to fluctuate substantially it would cause great uncertainties to the Company’s exchange gain
or loss export product prices dominated in foreign currencies raw material prices and other operational factors.The Company will leverage forward foreign exchange contracts and other methods to establish and improve the
exchange rate hedging mechanism and reduce the amount of foreign currency receipts and payments in order to
reduce the impact of exchange rate changes on the Company’s profitability.4. Environmental and safety Risk
With the enhancement of environmental awareness and stricter environmental protection requirements from the
government the Company proactively takes environmental protection measures increase corresponding invest-
ments strictly complies by relevant laws and regulations and production specifications in its daily management and
establishes strict standard operation procedures; however environmental or safety production accidents caused
by human errors or accidents still could not be eliminated which could affect the Company's normal business activ-
ities. Therefore there is a certain level of environmental protection and safety production risk.22
IV. Corporate Governance
Preplans of profit distribution or transfer from capital reserve
Preplans of profit distribution and transfer from capital reserve to common shares for
the reporting period
Distribution/transfer? No
Number of bonus shares per 10 common shares
(share)
Number of dividends (yuan) (tax included) per 10
common shares
Number of shares converted by capital
reserve per 10 common shares (share)
Explanations for the preplans of profit distribution or transfer from capital reserve to common shares
The Company’s equity incentive plan employee stock ownership plan or other employee
incentive initiatives and their impacts
Relevant equity incentive matters have been disclosed in interim announcements and there
has been no progress or changes in the subsequent implementation
Overview Indexing
Please refer to The Fifth Phase of the Employee Stock Ownership Plan of
Draft of the Company’s fifth phase of the Hengli Petrochemical (Draft) (Revised) and other relevant announcements
employee stock ownership plan—Revised of the Company disclosed on the website of the Shanghai Stock
Exchange on March 2 2021
Please refer to the Announcement of Hengli Petrochemical on the
Stock purchase completion under the Completion of Stock Purchase under the Fifth Phase of the Employee
Company’s fifth phase of the employee Stock Ownership Plan (Announcement No. 2021-012) disclosed on the
stock ownership plan website of the Shanghai Stock Exchange on March 16 202123
V. Environmental and Social Responsibility
Preplans of profit distribution or transfer from capital reserve
Hengli pays great heed to environmental protection and strictly adheres to the Environmental Protection Law of the
People’s Republic of China the Law of the People’s Republic of China on Promoting Clean Production and the Law
of the People’s Republic of China on the Prevention and Control of Environmental Pollution by Solid Wastes and
other relevant laws and regulations. The key pollutant discharging enterprises and their subsidiaries mainly include
Hengli Chemical Fiber Susheng Thermal Power Deli Chemical Fibre Hengke Advanced Materials Kanghui New
Material Hengli Petrochemical (Dalian) Hengli Refining and Chemical and Hengli Petrochemical.During the reporting period each pollutant discharging subsidiary carried out self-monitoring of their environmen-
tal impact and hired professional third parties to test various pollutant factors. The test results showed that the
concentration of various pollutants complied with national and local pollutant discharge standards and other
relevant standards. The total discharge of pollutants is under the required limit as outlined by operation permits.The specific pollutant discharge is as follows:
1. Hengli Chemical Fiber
Hengli Chemical Fiber commissioned Jiangsu Guoce Testing Technology Co. Ltd. Suzhou Huanyou Testing Co.Ltd. and Suzhou Shengze Environmental Monitoring Co. Ltd. to test various pollutants. The test results showed
that the emission concentrations of various pollutants were in line with the national and local pollutant discharge
standards or other relevant standards. The total discharge of pollutants is under the required limit as outlined by
operation permits.Wastewater No excessive emission
Exceeding Exhaust gas No excessive emission
Noise No excessive emission
The total amount of wastewater (Tonnes/year)
Wastewater COD Ammonia Total phos-phorus Total nitrogen
Amount of
discharge during the 34073 0.79492 0.00900 0.01363 0.36799
reporting period
Total Approved amount
emission of discharge (year)
/ 8.623 0.675 0.0684 5.748
Total amount of exhaust gas (tonnes/year)
Sulfur dioxide? Nitrogen oxides? PM VOCs
Amount of discharge
during the reporting 7.55646 64.97321 8.98913 0.04004
period
Approved amount
of discharge (year) 152.25 201.13 30.16 1.900824
2. Susheng Thermal Power
During the reporting period Susheng Thermal Power installed the boiler exhaust gas online self-monitoring equip-
ment in accordance with the governmental environmental management regulations and technical specifications
and adopted a combination manual-automatic monitoring approach. Suzhou Zhenghe Chemical Environmental
Protection Co. Ltd. outsourced the continuous emission monitoring equipment and system for maintenance and
operation. The plant boundary noise and fugitive exhaust gas emission monitoring the manual quarterly monitor-
ing of flue gas and the daily monitoring of industrial and desulfurization wastewater are outsourced to Suzhou
Shengze Environmental Monitoring Co. Ltd. Suzhou Shengze tested various pollutant factors and the test results
showed that the emission concentration of various pollutants met the national and local pollutant emission
standards or other related standards. The total discharge of pollutants is under the required limit as outlined by
operation permits.Wastewater No excessive emission
Exceeding Exhaust gas No excessive emission
Noise No excessive emission
Total amount of wastewater (tonnes/year)
Total Wastewater COD Ammonia
Total phos- Suspended
emission phorus solids
Amount of
discharge during 17661 / / / /
the reporting period
Approved amount
of discharge (year) 98550 / / / /
Total amount of exhaust gas (tonnes/year)
Sulfur Nitrogen Smoke Acetalde- Ethylene
Non-methane
dioxide oxides hyde glycol total hydrocar-bons
Amount of discharge
during the reporting 52.28211 116.67720 7.36915 / / /
period
Approved amount
of discharge (year) 434.337 868.674 173.735 / / /25
3. Deli Chemical Fiber
During the reporting period Deli commissioned Jiangsu Hengyu Environmental Protection Technology Co. Ltd. to
test various pollutant factors. The test results showed that the emission concentrations of various pollutants were
in line with national and local pollutant emission standards or other related standards. The total discharge of pollut-
ants are under the required limit as outlined by operation permits.Wastewater No excessive emission
Excessive Exhaust gas No excessive emission
emission
Noise No excessive emission
Total amount of wastewater (tonnes/year)
Total COD Ammonia Total phosphorus
emission
Amount of discharge
during the reporting 1.3638 0.0451 0.0258
period
Approved amount
of discharge (year) 45.46 0.502 0.094
Total amount of exhaust gas (tonnes/year)
Sulfur dioxide Nitrogen oxides Smoke
Amount of discharge
during the reporting 1.4731 11.54 0.165
period
Approved amount
of discharge (year) 39.2 33.75 6.7526
4. Kanghui New Material
During the reporting period Kanghui commissioned Dalian Boyuan Testing and Evaluation Center Co. Ltd. to test
various pollutant factors. The test results showed that the emission concentration of various pollutants met the
national and local pollutant emission standards or other related standards. The total discharge of pollutants met the
requirements of the total discharge permit.Wastewater No excessive emission
Excessive Exhaust gas No excessive emission
emission
Noise No excessive emission
Total amount of wastewater (tonnes/year)
Wastewater COD Ammonia
Amount of discharge
during the reporting 224768.33 6.332 0.07
period
Approved amount 961800
of discharge (year) 23.21 2.318
Total
emission
Total amount of exhaust gas (Tonnes/year)
Sulfur dioxide Nitrogen oxides Smoke
Amount of discharge
during the reporting 6.187 18.191 2.307
period
Approved amount 20.23 89.71 50.591
of discharge (year)27
5. Hengke Advanced Materials
Hengke commissioned Suzhou Huace Testing Technology Co. Ltd. to test various pollutant factors during the
reporting period. The test results showed that the concentration of various pollutants was in compliance with the
national and local pollutant discharge standards or other related standards. The total discharge of pollutants is
under the required limit as outlined by operation permits.Wastewater No excessive emission
Excessive Exhaust gas No excessive emission
emission
Noise No excessive emission
Total amount of wastewater (tonnes/year)
Wastewater COD Ammonia Total phosphorus
Amount of discharge
during the reporting 345205 8.17087 0.11225 0.08125
period
Approved amount / 6.05 0.92
of discharge (year) 381.95
Total
emission
Total amount of exhaust gas (Tonnes/year)
Smoke Non-methane total Sulfur dioxide Nitrogen oxides hydrocarbons
Amount of discharge
during the reporting 2.80313 18.43627 0.08718 5.64
period
Approved amount 297.2 423.2 63.14 28.86
of discharge (year)28
6. Hengli Petrochemical (Dalian)
Hengli Petrochemical (Dalian) tested various pollutant factors. The test results showed that the emission concen-
trations of various pollutants were in compliance with national and local pollutant emission standards or other
related standards. The total discharge of pollutants is under the required limit as outlined by operation permits.Wastewater No excessive emission
Excessive Exhaust gas No excessive emission
emission
Noise No excessive emission
Total amount of wastewater (tonnes/year)
Wastewater COD Ammonia Total phosphorus
Amount of discharge
during the reporting / 151.52 0.87 /
period
Approved amount
of discharge (year) / 559 111.8 240.05
Total
emission
Total amount of exhaust gas (tonnes/year)
Non-methane total
Sulfur dioxide Nitrogen oxides Smoke hydrocarbons
Amount of discharge
during the reporting 120.80 121.61 4.47 176.09
period
Approved amount
of discharge (year) 598 821.77 248.54 155.756229
7. Hengli Petrochemical Refining
During the reporting period Hengli Petrochemical Refining conducted tests on various pollutant factors and the
test results showed that the emission concentrations of various pollutants complied with national and local pollut-
ant emission standards or other related standards. The total discharge of pollutants is under the required limit as
outlined by operation permits.Wastewater No excessive emission
Excessive Exhaust gas No excessive emission
emission
Noise No excessive emission
Total amount of wastewater (tonnes/year)
Wastewater COD Ammonia Total phosphorus
Amount of discharge
during the reporting 1063911 21.94 0.141 7.80
period
Total Approved amount of discharge (year) 12620000 249.23 19.86 70.90
emission
Total amount of exhaust gas (tonnes/year)
Sulfur dioxide Nitrogen oxides Smoke Non-methane total hydrocarbons
Amount of discharge
during the reporting 605.56 1562.62 43.27 1250.45
period
Approved amount
of discharge (year) 2121.70 5064.92 965.78 3158.3330
8. Hengli Petrochemical Chemical
During the reporting period Hengli Petrochemical Chemical conducted tests on various pollutant factors and the
test results showed that the emission concentrations of various pollutants complied with national and local pollut-
ant emission standards or other related standards. The total discharge of pollutants is under the required limit as
outlined by operation permits.Wastewater No excessive emission
Excessive Exhaust gas No excessive emission
emission
Noise No excessive emission
Total amount of wastewater (tonnes/year)
Wastewater COD Ammonia Total phosphorus
Amount of discharge
during the reporting 1184773.4 22.3 0.292 9.746
period
Total Approved amount of discharge (year) 4086000 204.3 32.7 61.3
emission
Total amount of exhaust gas (tonnes/year)
Sulfur dioxide Nitrogen oxides Smoke Non-methane total hydrocarbons
Amount of discharge
during the reporting 18.5759 212.0794 4.345 84.511
period
Approved amount
of discharge (year) 116.5 974.4 149 736.08831
Construction and operation of pollution prevention facilities
During the reporting period the above companies who discharged pollutants all built their pollutant control facili-
ties following the environmental impact assessment requirements of the construction project. Currently the facili-
ties are under normal operation. The companies carry out daily maintenance of the facilities to ensure their
efficient and stable operations of keeping emissions within the standards.The environmental impact assessment of construction projects and other administrative
permits on environmental protection
During the reporting period for the company’s construction projects environmental impact assessment reports
(forms) or approval forms have been prepared by qualified bodies and have received the approval of the corre-
sponding environmental protection authorities. The project incorporates environmental protection into the project
“design construction and production simultaneously”. The completed projects and supporting facilities have all
passed final inspections from the environmental protection organs and the projects under production have
obtained their relevant administrative permits.Emergency plan for environmental incidents
Item Item Item Ending balance
The Environmental Incident
Hengli Chemical Fiber Emergency Plan of Jiangsu Hengli Wujiang Bureau of Environmental
Chemical Fiber Co. Ltd. Protection
320509-2019-038-M
Deli Chemical Fiber The Environmental Incident Suqian Bureau of Environmen-Emergency Plan tal Protection Sucheng Branch 321302-2021-006-L
The Environmental Incident
Susheng Thermal Power Emergency Plan of Suzhou Wujiang Bureau of Environmental 320509-2020-043-M
Susheng Thermal Power Co. Ltd. Protection
The Environmental Incident
Kanghui New Material Emergency Plan of Yingkou Xianrendao Bureau of Environmen- 210881-2020-003-M
Kanghui Petrochemical Co. Ltd. tal Protection Yingkou
The Environmental Incident Tongzhou Bureau of Environmental
Hengke Advanced Materials Emergency Plan of Jiangsu Hengke Protection 320682-2020-057-M
Advanced Materials Co. Ltd
The Environmental Incident
Hengli Petrochemical Emergency Plan of Hengli Wafangdian (Changxing Island
Refining Petrochemical (Dalian) Refining Economic Zone) Branch Bureau of 210281-2021-050-H
Co. Ltd. Environmental Protection Dalian
Hengli Petrochemical The Environmental Incident Wafangdian (Changxing Island
(Dalian) Emergency Plan of Hengli Economic Zone) Branch Bureau of 210263-2020-001-HPetrochemical (Dalian) Co. Ltd. Environmental Protection Dalian
The Environmental Incident
Hengli Petrochemical Emergency Plan of Hengli Wafangdian (Changxing Island
Chemical Petrochemical (Dalian) Chemical Economic Zone) Branch Bureau of 210263-2019-011-H
Co. Ltd. Environmental Protection Dalian32
The environmental self-monitoring plan
The company’s key pollutant discharging subsidiaries to conduct tests it would commission third-party agen-
have formulated their environmental monitoring plan in cies with environmental monitoring qualifications to
accordance with relevant national standards and conduct discharge tests of the special pollutants such
environmental management system requirements. as wastewater and exhaust gas. The companies
They have applied for the pollutant discharge permit appoint special personnel to check and summarize
and filed with the environmental regulative organ of pollutant indicators every day analyzed the data and
their jurisdiction. The company’s environmental moni- submitted feedback to relevant departments for refer-
toring station regularly tested various pollutants at the ence during technical parameters adjustment all to
sewage outlets of each plant. If a company were unable ensure emission compliance.Measures and effects taken to reduce carbon emission during the reporting period
Our company actively responded to the national policy value-added propylene and alkylated oil. The C1 - C8
of “carbon peak and carbon neutrality”. We integrated components are used separately to truly realize molec-
the upstream midstream and downstream industries ular oil refining and molecular chemical engineering.development in the park and leveraged the resource The C2 components hydrogen and fuel gas produced
integration and scale advantages. The contribution of during the process can be flexibly used in other
carbon emission reduction brought by the company’s processes.refining and chemical integration industrial chain (1) High value-added recovery of C2 components in the
model mainly came from the following five aspects: refining and chemical dry gas
The dry gas component of the refining and chemical
Reduced carbon emission from the chem- sector emission is about 3.6 to 3.8% hydrogen 39 to
ical process and fossil fuel combustion 42% C2 31 to 32% C3 and C4 and 6.5 to 8% C5.through increased yield of products. Before ethylene production these components and
their high economic value are not fully utilized mostly
In the refining and chemical integration project being used as fuel. After the company’s ethylene
upstream products can be used as feed for down- project is put into operation the dry gas from the refin-
stream processing. This integration greatly raised the ing and chemical plants has supplied 1.229 million
product utilization rate at each link and avoided the tonnes per year to the recovery unit of the ethylene
carbon emission caused by direct or indirect waste plant. The dry gas in the refinery is pressurized to
through discharge or combustion (such as fuel 3.1MPaG to remove CO2 and water and cryogenically
combustion) previously accrued due to the inability to separate methane and hydrogen. C2 C3/C4 and C5+
use on-site directly or the high costs of transportation are sent to the pyrolyzer as feed. Thus the annual
for export. Our 20 million tonnes/year refining and recovery and utilization of C2 are about 541000
chemical integration project adopt a full-range hydro- tonnes C3 and C4 453000 tonnes C5 60000
genation process. For the first time in China a compa- tonnes and the remaining gas after separation
ny has used the ebullated-bed hydrocracking process returned to the pipeline as fuel is 17.1 million tonnes.to hydrocrack diesel wax oil and residual oil to maxi- The net value of ethylene feed gas is 1.06 million
mize light and heavy naphtha feed production. This can tonnes of feedstock effectively utilized annually
meet the raw materials demand of the downstream 1.5 accounting for about 27.8% of the ethylene plant
million tonnes/year ethylene plant and the 4.5 million cracking feedstock. The recycled of C2 components
tonnes/year aromatic plant. At the same time propane avoids burning emissions as fuel and the carbon emis-
and isobutane are dehydrogenated to produce high sion reduction amounts to 1.59 million tonnes/year.33
(2) Our refining and chemical project takes atmospher- Due to the closer connected production
ic and vacuum-ebullated bed residual oil hydrocracking stages and the optimization of logistic
as the mainline to realize the whole hydrogenation links carbon emission in reheating and
process. The amount of hydrogen used is quite high. transportation is reduced.Under full-load production capacity the amount of pure
hydrogen used in aromatics is over 760000 tonnes/- The Hengli refining and chemical integration model
year of which 510000 tonnes is supplied by the refin- means that the upstream and downstream processes
ing and chemical sector itself and the remaining is are geographically closer together. This integration
supplied by coal-to-hydrogen and ethylene. After the directly supplies heated feeds between devices in
ethylene plant is put into operation it produces 51000 different sections and reduce the energy consumption
tonnes/year of hydrogen of which the ethylene due to removing the need for reheating; additionally
production itself uses 44000 tonnes and 47000 aromatic ethylene PX acetic acid methanol and
tonnes is supplied to the refining and chemical sector. other bulk chemical products or feeds can be produced
If there is no support for the integration project this and used within the facilities transported through
excess will become stagnant and unused. Through the pipelines in the park. This can greatly save logistics
consumption and use of the refining and chemical warehousing and loss costs while avoiding carbon
plants the annual energy consumption is saved by emission from long-distance transportation of
51700 tonnes of standard oil. The hydrogen produc- outsourced raw feed.tion-saved from coal that initially supplies hydrogen (1) Direct supply of thermal materials between plants of
can reduce the supply of hydrogen and produce more different sectors
methanol and acetic acid. Assume 51000 tonnes of Hengli (Dalian Changxing Island) Industrial Park fully
surplus hydrogen per year and assuming a 11tCO2/tH2 designed a mutual supply of materials between
emission rate the emission saved by the use of surplus upstream and downstream sectors and plants and
hydrogen reached 560000 tonnes/year. reduces storage area operations to realize direct heat
(3) All fuel gas in the industrial park is recycled and supply of materials reduce the energy loss caused by
used material cooling and heating and save energy
In the Hengli (Dalian Changxing Island) Industrial Park consumption. By adjusting the production conditions
the by-product methane and hydrogen from the and optimizing the operations between upstream and
ethylene plant and the biogas from the PTA plant have downstream materials in a timely manner the refining
been fully recycled which not only reduces green- and chemical integration project has realized the flow
house gas emissions but also increases corporate of materials between different sectors and different
benefits. The ethylene plant's annual by-product of plants with less transfer to tanks and more direct
methane and hydrogen is about 72000 tonnes and supply to save energy.the by-product of biogas by the PTA plant is about In the refining and chemical supply reforming of
33000 tonnes. Transmitted through the fuel gas aromatics a light hydrocarbon recovery unit is installed
pipeline in the industrial park they are now used as in the refining and chemical plant to collectively recov-
feed for refining and chemical use which saves the er lightweight components from atmospheric equip-
amount of natural gas purchased by Hengli Refining ment and hydrogenation equipment to produce naph-
and Chemical and also reduces the emission of green- tha. Hydrogenated naphtha with kerosene isomerized
house gases through inevitable leakage during dewaxed naphtha of lubricating oil and hydrocracked
combustion. The annual energy consumption for naphtha of ebullated bed residue are used as
recycling is equivalent to 95100 tonnes of standard oil. feedstock for the pre-hydrogenation of the aromatics
According to a rough calculation of the carbon emis- unit. Refined naphtha and diesel hydrocracking heavy
sion intensity of the equivalent amount of natural gas naphtha wax oil hydrocracking heavy naphtha is used
the carbon emission reduction brought by the recycling as reaction feed of catalytic reforming of the aromatics
and reuse of fuel gas is 120000 tonnes/year. unit. In 2020 the annual directly fed into the three sets34
of reformers for refining and chemical hot materials Japan’s comes from ENEOS Corporation who has
was nearly 9 million tonnes. The direct supply of hot distributed production capacity in Mizushima Oita
feed materials with significant energy-saving effects Chiba Kashima Kawasaki Natsu and other places.accounted for about 92% of the total feed volume of Take the Hengli Dalian Changxing Island Project as an
the aromatics reforming equipment and the annual example. Assume the 4.5 million tonnes/year PX feed
energy consumption was 5800 tonnes of standard oil is imported from Japan and South Korea instead of
reducing CO2 emission by about 17000 tonnes. produced from the upstream plant of the integration
In the aromatics unit benzene and p-xylene are direct- project. According to the above percentages calculat-
ly supplied to storage tanks as products. PX and ed based on the distance of South Korea’s main port to
benzene products are changed from entering the daily the Dalian Port of about 500km and Japan about
inspection tank to PX direct supplying the PTA raw 1000km the average transportation distance of 4.5
material storage tank and benzene directly supplying million tonnes of PX per year can reach as long as
the benzene finished product storage tank. Due to less 630km. Milagewise one-way transportation is equiva-
intermediate transmission the daily electricity saving is lent to 30000 km traveled for a 100000-tonne
7500kWh. According to China’s power system's container ship. Assume a 30g CO2 emission per tonne
current carbon emission intensity (596g CO2/kWh) per kilometer of the cargo ship; the transportation
this change equals an annual CO2 emission reduction carbon emission reduction due to the connection of
of about 20000 tonnes. processes is 90000 tonnes/year. Considering the
(2) Reducing long-distance transportation of raw mate- actual import the transportation distance is actually
rials longer than the above calculation based on the
The carbon emission reduction brought about by distance from Korea and Japan alone and the contri-
decreased long-distance transportation mainly comes bution to carbon emission reduction is thus actually
from “PX - PTA” in the “crude oil - PX - PTA - PET” larger.production chain. Integration greatly changes the
source of PX the raw material for PTA production. Reduction of carbon emission due to
Before integration PX was mainly imported from energy cascade utilization.abroad while after integration PX can be directly
produced in the park. In 2018 China’s external depen- The Hengli Refining and Chemicals Project has created
dence on PX was as high as 61%; in 2019 with a large conditions for the cascaded utilization of energy within
increase of domestic PX production capacity to 14.65 the park. The project’s refining chemical and coal
million tonnes the external dependence dropped hydrogen production processes have been combined
significantly to 51%. Most of China’s new PX capacity to achieve a mutual supply of materials and energy
was in large-scale refining and chemical integration pairs. The cascaded utilization of different energy
projects and almost all of their PX output was directly grades saved significant overall energy consumption
used for PTA production downstream of the park. The and reduced carbon emission caused by energy utiliza-
opening of the “PX - PTA” chain in the large-scale refin- tion. The deep thermal coupling between the oil refin-
ing and chemical integration projects has hugely cut ing and chemical production facilities circumvents the
down the outsourcing of PX and carbon emission waste from upstream cooling and downstream reheat-
caused by long-distance transportation has also been ing; additionally the low-temperature heat source after
avoided. production in the park can also be used for other
China mainly imported PX from South Korea and purposes besides the production of main products
Japan. In 2019 China imported 6.04 million tonnes of (power generation desalination etc.). This can further
PX from South Korea accounting for 40% of total increase economic benefits without additional carbon
imports; and 2.1 million tonnes from Japan accounting emissions.for 14%. South Korea's largest PX production capacity The carbon emission reduction of the Hengli Refining &
comes from SK Chemicals in Ulsan and Incheon; Chemicals Project due to the cascaded utilization of35
energy is demonstrated in four aspects. First the The scenario of large-scale application of
Hengli Industrial Park recovers low-parameter steam decarbonization technology due to
from two aromatics production lines in waste heat high-concentration carbon emission.power generation. The amount of power generation
from waste heat is 120000 kWh saving 36.7t/h of Hengli Petrochemical and Hengli Petrochemical Chem-
standard coal and 308000 tonnes of standard coal ical produce a large amount of high-concentration CO2
every year. In low-temperature warm water waste heat during production. Once captured in the park it can be
recovery the park has 21000t/h waste heat in the form used as a raw material to produce chemical products.of 95℃water. The water is now gathered and used for This allows production to use self-produced CO2 as
heating seawater desalination lithium bromide refrig- well as reduce carbon emission. Chemical production is
erator and boiler deaeration saving 75t/h and an organic conversion process with hydrogen and
carbon as the basic elements in which hydrogen and
630000 t/y of standard coal.CO2 are used as raw materials for synthesis reaction
Petrochemical production is a heavy water consumer.and many major products in the chemical industry’s
The Hengli Changxing Island Industrial Park takes its value chain can be produced. The high concentration
coastal advantage and achieves the goal of producing of CO2 in the park creates a huge array of application
freshwater as a coastal factory without additional fresh scenarios for the future use of green hydrogen and CO2
water consumption by making full use of cascaded to produce methanol and its downstream chemical
energy. In high-temperature condensate waste heat products. Even if CO2 is not used as raw material the
recovery 100t/h of high-temperature condensate integrated park creates favorable conditions of shared
water is produced which is used to heat the make-up infrastructure for carbon capture transportation and
water of the deaerator from 25℃ to 35℃ in the thermal storage thereby greatly reducing costs and the
power plant saving 64.4t/h and 540000t/y of difficulty of implementation.standard coal. In addition the integrated model helps At present there have been domestic and foreign
optimize the configuration of a self-contained thermal examples of chemical production using green hydro-
power plant. The thermal power plant boiler fully recov- gen and CO2 . Fossil fuel is gradually decreasing in raw
ers the heat of flue gas through the waste heat utiliza- materials and the CO2 generated in the original
production process is fixed into the product to reduce
tion system increases the inlet air temperature of the
emission. For example the Iceland-based company
furnace reduces the exhaust gas temperature from
Carbon Recycling International (CRI) currently produc-
140℃ to 90℃ raises the boiler efficiency 3 percentage es 4000 tonnes of zero-carbon methanol per year with
points to 94% and saves about 128400 tonnes of the technology and plans to expand its capacity to
standard coal annually. The thermal power plant adopts 40000 tonnes. The carbon dioxide feed comes from a
7 heating methods of different pressure grades and geothermal power plant and the 5MW power of the
the backpressure unit is efficiently used. The coal water electrolysis equipment used to produce hydro-
consumption for power generation is only 160g/kWh gen also comes from geothermal energy. Japan’s Mitsui
which is 96.18g/kWh lower than the 266.18g/kWh Chemicals has also built a pilot plant to synthesize
indicator for one million thermal power units. The methanol from hydrogen and carbon dioxide and has
annual power generation is about 5 billion kWh saving conducted a feasibility study for industrial production.281200 tonnes of standard coal annually. Assuming a The refining and chemical integration industrial park is
standard coal CO2 emission coefficient of 0.67t/tce an ideal application scenario for coupling the disruptive
(recommended by the Energy Research Institute of technology of green hydrogen because its CO2 acquisi-
National Development and Reform Commission) the tion cost is low and the products that can be obtained
in large quantities with this technology path are also
above measures help reduce carbon emission by 1.26
needed as raw materials in the refining and chemical
million tonnes per year.integration value chain.36The carbon emission reduction from the ment plant” has changed traditional sewage plants’
circular economy by breaking the bound- passive reception and closed treatment model fully
aries of what is possible for auxiliary facil- integrated sewage treatment and petrochemical
ities. processes into a whole and established a modeling
example of the “embedded sewage treatment plant”.The sewage treatment plant is a representative auxilia- We have combined the sewage treatment design into
ry facility in the park. Compared with the traditional the design of the whole plant and implemented it with
model of separate treatment of sewage for each link the main process design simultaneously. Hengli Petro-
the recycling technology in the integrated embedded chemical Refining has more than 40 petroleum and
sewage treatment plant can function with greater chemical production facilities which discharge various
resource recycling and carbon emission reduction. In wastewater waste gas and waste residues. In the
the traditional model the designer focuses only on project to realize this philosophy we have carefully
wastewater and collects and treats the wastewater. reviewed more than 40 individual petrochemical plants
However when the boundary of sewage treatment is and found 6 embedded points which can achieve the
considered in its entirety and enlarged to the scope of goal of using “waste” to control “waste” and becoming
the whole park scale waste and the overall material mutual resources between each other. Through the
can be balanced some waste residues waste gas or review and analysis of the whole process and optimiza-
refining and chemical by-products are possible to be tion of resource allocation the sewage treatment plant
reused in the sewage treatment process. is regarded as the core of the entire plant’s waste treat-Hengli’s new philosophy of “embedded sewage treat- ment in order to realize circular economy and greenproduction.37
VI. Important Items
Delivery of Commitments
Commitments made by the actual controller shareholders related parties purchasers the Company and other relevant parties
during or that continue through the reporting period
Unit: 100 million yuan Currency: CNY
Whether the
Type of Whether there commitments Action plans in Background Committed by Content of Time and Reasons in case Commitments is a time limit are delivered in a case of failed Commitments Duration of failed deliveryfor delivery strict and timely timely delivery
manner
Shares of listed
companies
Fan Hongwei acquired through Commitments
related to material Trading restrictions Hengneng Invest-
material asset From February
asset reorganiza- of shares ment Hengfeng
reorganization shall 2018 to February Yes Yes
Investment not be transferred 2021tion within 36 months
from the date of
listing38
Material guarantees performed or yet to be completed during the reporting period
Situation of External Guarantee (excluding guarantee for subsidiaries)
The Relation- The Amount Date of Com- Maturity Type of Principal Object of Whether Whether Overdue Counter Whether Related
guarantor ship warantee guaranteed guarantee mencement date guarantee debt status guarantee the the amount of guarantee the Relation-
between (date of date (if any) guarantee guarantee guarantee situation guarantee ship
the agreement) has been is overdue is
guarantor performed performed
and the for related
listed parties
company
Nil
Total amount guaranteed during the reporting period (excluding guarantee 0
for subsidiaries)
Total guarantee balance by the end of the reporting period (A) (excluding
guarantee for subsidiaries) 0
Guarantee for subsidiaries
Total amount guaranteed for subsidiaries during the reporting period 2111.18
Total guarantee balance for subsidiaries by the end of the reporting period
(B) 1439.10
Total amount guaranteed (including guarantee for subsidiaries)
Total amount guaranteed (A+B) 1439.10
Percentage of the total amount guaranteed in the Company’s net assets (%) 286.3639
of which:
Amount guaranteed for shareholders the actual controller and related
parties (C) 0
Amount of debt guarantee directly or indirectly for warrantees whose
asset-liability ratio exceeds 70% (D) 0.98
Amount of guarantee in excess of 50% of net assets (E) 1121.35
Total amount of the aforementioned three guarantees (C+D+E) 1122.33
Explanation of unexpired guarantees that could bear joint and several
liabilities for satisfaction
Explanation of guarantee status During the reporting period external guarantees of the Company performed were all for the Company and its subsidiaries (sub-subsidiaries)40
Share Changes and Shareholders
Changes in shareholdings
Unit：shareBefore the change Increase/decrease from the change After the change
Shares
Number of Percentage (%) New issue of Bonus shares converted from Others Sub-total Number of Percentage (%)
shares shares capital reserve shares
I. Shares with trading 2407164177 34.20 -2407164177 -2407164177 0 0
restrictions
1. State-owned shares
2. State-owned legal
person shares
3. Shares held by other 2407164177 34.20 -2407164177 -2407164177 0 0
domestic entities
Including: Shares held
by domestic non 1521058208 21.61 -1521058208 -1521058208
state-owned legal
person
Shares held by domes-
886105969 12.59 -886105969 -886105969
tic natural persons 0 0
4. Shares held by other
foreign entities
Including: Shares held by
overseas legal person41
Shares held by overseas
natural persons
II. Circulating shares
without trading restric- 65.80 2407164177 2407164177 7039099786 100.00
tions
1. RMB ordinary shares 4631935609 65.80 2407164177 2407164177 7039099786 100.00
2. Domestic listed
foreign shares
3. Overseas listed
foreign shares
4. Others
III. Total number of
7039099786 100.00 0 0 7039099786 100.00
shares
On February 8 2021 the listing and circulating of 2407164177 shares were restricted due to the Company’s material asset reorganization.42
Changes in shares with trading restrictions
Unit: Share
Number of Number of Increase in Number of
shares with shares shares shares
trading released subject to subject to Date of
Name of restrictions at from trading trading trading Reasons for shares
shareholder the beginning restrictions restrictions restrictions at restrictions released
of the during the during the the end of from trading
reporting reporting reporting the reporting restrictions
period period period period
Fan Hongwei 886105969 886105969 0 0 Material asset February 8 reorganization 2021
Hengneng 1498478926 1498478926 0 0 Material asset February 8 Investment reorganization 2021
Hengfeng Material asset
Investment 22579282 22579282 0 0
February 8
reorganization 2021
Total 2407164177 2407164177 0 0 / /
Total number of shareholders:
Total number of common shareholders as of the end of
the reporting period (shareholder) 128295
Total number of preferred shareholders with restored
voting rights as of the end of the reporting period 0
(shareholder)43
Shareholdings of the top 10 shareholders and top 10 floating shareholders (or shareholders
holding shares without trading restrictions) as of the end of the reporting period
Unit: Share
Shareholdings of the top 10 shareholders
Increase/de- Number of Pledged marked or
Name of Number of
crease during shares as of the
shareholder end of the Percentage shares held
frozen Nature of
the reporting
(full name) reporting (%) with trading Status of
shareholder
period period restriction shares Quantity
Hengli Group Domestic
Co. Ltd. -562000000 1538612342 21.86 0 Pledged 656580000
non-state-o
wned legal
person
Hengneng
Investment Domestic 0 1498478926 21.29 0 Nil non-state-o
(Dalian) Co. wned legal
Ltd. person
Domestic
Fan Hongwei 0 886105969 12.59 0 Nil natural
person
Tak Shing Li
International 0 732711668 10.41 0 Nil Overseas
Holdings legal person
Limited
Hengli Group
－Southwest
Securities－
21 Hengli E1
special 562000000 562000000 7.98 0 Nil Other
guarantee
and trust
property
account
HKSCC
(Nominees) -15084092 147154164 2.09 0 Nil Other
Limited
Jiangsu
Hegao Domestic
Investment 0 61952065 0.88 0 Nil
non-state-o
wned legal
Co. Ltd. person44
Hailaide
International 0 52246838 0.74 0 Nil Overseas legal
Investment person
Limited
Special
securities
account for
agreed
repurchase
type securi- -1330000 43970000 0.62 0 Nil Other
ties trading of
Guotai Junan
Securities
Company
Limited
Tibet Trust
Corporation
Limited－
Tibet Trust－
the fourth
phase of the
employee -12815100 37378100 0.53 0 Nil Other
stock
ownership
pooled capital
trust plan of
Hengli
Petrochemi-
cal
Shareholding of the top 10 shareholders of shares without trading restrictions
Class and quantity of shares
Name of shareholder Number of circulating shares without
trading restrictions Class Quantity
Hengli Group Co. Ltd. 1538612342 RMB common stock 1538612342
Hengneng Investment (Dalian) 1498478926 RMB common Co. Ltd. stock 1498478926
Fan Hongwei 886105969 RMB common
stock 88610596945
Tak Shing Li International RMB common
Holdings Limited 732711668 stock 732711668
Hengli Group－Southwest
Securities－21 Hengli E1 562000000 RMB common 562000000
special guarantee and trust stock
property account
HKSCC (Nominees) Limited 147154164 RMB common stock 147154164
Jiangsu Hegao Investment Co. 61952065 RMB common
Ltd. stock 61952065
Hailaide International Invest- 52246838 RMB common ment Limited stock 52246838
Special securities account for
agreed repurchase type
securities trading of Guotai 43970000 RMB common stock 43970000
Junan Securities Company
Limited
Tibet Trust Corporation Limited
－Tibet Trust－the fourth phase
of the employee stock 37378100 RMB common 37378100
ownership pooled capital trust stock
plan of Hengli Petrochemical
Explanations of buyback
special securities accounts of The top 10 shareholders do not have a buyback special securities account.the top 10 shareholders
Hengli Group assigned 562000000 share capital of company shares to the“Hengli Group－Southwest Securities－21 Hengli E1 special guarantee and trustExplanations of voting rights property account” due to the issuance of exchangeable corporate bonds. The
proxy entrustment and special account is held in the name Southwest Securities Co. Ltd. Southwest
abstention of the aforesaid Securities will deal with matters according to Hengli Group’s opinions without
shareholders harming the interests of the holders of the exchangeable corporate bonds
when exercising the voting right.Explanations of related Hengli Group Hengneng Investment Fan Hongwei Tak Shing Li Hegao
relationship or concerted Investment and Hailaide are persons acting in concert among each other; the
action among the aforesaid Company has no information on whether there is related relationship among
shareholders other shareholders.Explanations of preferred
shareholders with restored Nil
voting rights and the number of
shares held46
VII. Relevant Information of Bonds
Basic information of corporate bonds
Unit: 100 million yuan Currency: CNY
Name of bond Public issuance of corporate bonds of 2019 by Hengli
Petrochemical Co. Ltd. (first tranche)
Short name 19 Hengli 01
Code 155749.SH
Date of issuance From September 25 2019 to September 27 2019
Value date September 27 2019
Maturity date September 27 202
Bond balance 10
Interest rate (%) 6.30
Interests will be paid once a year and the principal is repaid in a lump sum
Principal and interest payment when the bond is due. The last installment of interest will be paid together
with the repayment of the principal.Trading venue Shanghai Stock Exchange
Suitability arrangement of
155749.SH
investors (if any)
Trading mechanism 155749.SH
Whether there is risk of
No
termination of listing47
Key accounting data and financial indicators
Unit: yuan Currency: CNY
Key indicators By the end of the By the end of the Flux (%) Reasons for
reporting period previous year changes
Current ratio 0.65 0.61 6.56
Quick ratio 0.33 0.35 -5.71
Debt-to-assets
ratio (%) 74.99 75.38 -0.52
The reporting period Same period of last Reasons for
(January to June) year Flux (%) changes
Net profit excluding
extraordinary profit 8266136381.56 5494688252.54 50.44
and loss
Total debt-to-EBIT-
0.1213 0.0905 34.02
DA ratio
Interest coverage
ratio 4.91 3.48 40.98
Cash flow interest
coverage ratio 6.64 6.94 -4.30
EBITDA-to-interest
coverage ratio 6.53 4.62 41.33
Loan repayment
rate (%) 100% 100% 0.00
Interest coverage
rate (%) 100% 100% 0.0048
VIII. Financial Report
Consolidated Balance Sheet June 30 2021
Prepared by: Hengli Petrochemical Co. Ltd. Unit: yuan Currency: CNY
Item Note s June 30 2021 December 31 2020
Current assets：
Cash and bank balances 19048515671.43 15671338845.58
Currency margin receivable 377707343.81
Provision of settlement fund
Funds lent
Trading financial assets 685929126.58 1650130008.46
Settlement guarantee fund
receivable 10050136.79
Derivative financial assets
Notes receivables 3242862.85 4334402.76
Accounts receivables 416922134.69 1363602415.10
Receivable financing 2209137772.55 4082386076.60
Prepayments 3591094480.71 1994374678.13
Insurance premiums receivable
Cession premiu ms receivable
Provision of cession receivable
Other receivables 1287875315.02 803130210.03
Including： Interest receivablesDividend receivables
Recoursable financial assets
acquired
Inventories 26547232372.12 19691123430.81
Contract assets
Assets held for sale
Non -current assets due within
one year
Other current assets 5962724839.36 6844803825.48
Total current assets 60140432055.91 52105223892.95
Non -current assets
Loans and payments on behalf
Debts investment
Other debts investment
Long -term receivables
Long -term equity investments
Other equityinstruments
investment 199800000.00 199800000.00
Other non-current financial
assets
Investment properties 31735166.21 32573461.39
Fixed assets 120509211988.31 121850294763.69
Construction in progress 6145331822.15 4195710084.65
Productive biological assets
Oil and gas assets
Usage right assets 728965845.32
Intangible assets 7394787235. 12 7188503385.13
Development expenditure
Goodwill 79830909.39
Long -term deferred expenses 2741922227.32 3085329048.29
Deferred tax assets 178101446.15 109496755.1449
Other non -current assets 2795757245.96 2261795258.47
Tota l non -current assets 140805443885.93 138923502756.76
Total assets 200945875941.84 191028726649.71
Current liabilities：
Short -term loans 41817234796.04 49879420683.06
Currency margin payable 519032545.13
Borrowing from the C entral
Bank
Deposit funds
Trading financial liabilities 329312832.40 88999293.44
Derivative financial liabilities
Notes payable 11376562617.86 7805074070.85
Accounts pay able 14847169984.62 15004707112.76
Receipts in advance
Contract liabilities 8695979681.75 5401458679.01
Financial assets sold for
repurchase
Customer bank deposits and
due to banks and other financial
institutions
Funds received as agent of
stock exchange
Funds received as stock
under writer
Employee compensation
payable 302782680.79 364407376.56
Taxes payable 1723409756.12 2290700960.19
Other payables 8176832270.88 416688235.50
Including: Interest pay able
Dividend payable 3932100.00 3977100.00
Handlin g charges and
commission payable
Reinsured accounts payable
Liabilities held for sale
Non -current liabilities maturing
within one year 3250724313.29 3828963320.81
Other current liabilities 1112797638.72 719118891.93
Total current lia bilities 92151839117.60 85799538624.11
Non -current liabilities：
Reserves for insurance contract
Long -term loans 54279526154.51 53883057081.22
Bonds payable 1046840475.90 1013970663.36
Including: Preference shares
Per petual bonds
Lease liabilities 89789811.14 -
Long -term payables 4000000.00 123322260.33
Long -term employee
compensation payable
Provisions
Deferred income 3116983109.17 3175206156.76
Deferred tax liabilities 2356307.17 924 0902.12
Other non -current liabilities
Total non -current liabilities 58539495857.89 58204797063.79
Total liabilities 150691334975.49 144004335687.9050Owner’ s equity（ orshareholder’s rights andinterests）：
Paid-in capital（ or Sharecapital 7039099786.00 7039099786.00 ）
Other equity instruments
Including: Preference shares
Perpetual bonds
Capital reserve 18364551413.27 18350115179.6 5
Less: Treasury shares 228626593.18 324811781.18
Other comprehensive income -174801353.83 -100823962.53
Special reserve 50131635.93 77581307.23
Surplus reserve 743268339.04 743268339.04
Ordinary risk reserve
Undistributed prof its 24344427409.50 21120648008.95
Total owner’s equity (or
shareholder’s rights and
interests) attributable to the 50138050636.73 46905076877.16
parent company
Minority shareholders’ interests
and rights 116490329.62 119314084.65
Tota l owner’s equity (or
shareholder’s rights and 50254540966.35 47024390961.81
interests)
Total liabilities and owner’s
equity (or shareholder’s rights 200945875941.84 191028726649.71
and interests)
Legal representative: Fan Hongwei
Person in charge of financial function: Liu Xuefen
Prepared by (person in charge of the accounting firm): Zheng Minxia
Parent Company’s Balance Sheet June 30 2021
Prepared by: Hengli Petrochemical Co. Ltd. Unit: yuan Currency: CNY
Item Notes June 30 2021 December 31 2020
Current assets ：
Cash and bank balances 9476416.03 27650112.58
Trading financial assets
Derivative financial assets
Notes receivables
Accounts receivables
Receivable financing
Prepayments 13755 2.16 404850661.55
Other receivables 3903598.42 4863304987.80
Including ： Interest receivablesDividend receivables 4829955000.00
Inventories
Contract assets
Assets held for sale
Non -current assets due within
one year
Other current assets 82343157.18 28175701.13
Total current assets 95860723.79 5323981463.0651
Non -current assets
Debts investment
Other debts investment
Long -term receivables
Long -term equity investments 43212245704.93 42826112 800.93
Other equity instruments
investment
Other non-current financial
assets
Investment properties
Fixed assets 1608525921.78 533919.78
Construction in progress
Productive biological assets
Oil and gas assets
Usage right ass ets
Intangible assets 1415094.34
Development expenditure
Goodwill
Long -term deferred expenses
Deferred tax assets
Other non -current assets 955705232.28
Total non -current assets 44822186721.05 43782351952.99
Total assets 44918047444.84 49106333416.05
Current liabilities：
Short-term loans
Trading financial liabilities
Derivative financial liabilities
Notes payable
Accounts pay able 460000.00 4534800.00
Receipts in advance
Contract liabilities
Employee compensation 1465382.00
payable
Taxes payable 3809547.00 2416483.11
Other payables 11904836797.38 10856341775.75
Including: Interest pa yable
Dividend payable
Liabilities held for sale
Non -current liabilities maturing
within one year
Other cu rrent liabilities
Total current liabilities 11909106344.38 10864758440.86
Non -current liabilities：
Long -term loans
Bonds payable 1046840475.90 1013970663.36
Including: Preference shares
Perpetual bonds
Lease liabilities
Long -term payables
Long -term employee
compensations payable
Provisions
Deferred income 14000000.0052
Deferred tax liabilities
Other non -current liabilities
Total non -current liabilities 1060840475.90 1013970663.36
Total liabilities 12969946820.28 11878729104.22Owner’s equity （ orshareholder’s right s andinterests）：
Paid -in capital （or Share 7039099786.00 7039099786.00capital）
Other equity instruments
Including: Preference shares
Perpetual bonds
Capital reserve 23935956217.92 23794748212.70
Less: Treasury shares 2286 26593.18 324811781.18
Other comprehensive income
Special reserve
Surplus reserve 1270353247.78 1270353247.78
Undistributed profits -68682033.96 5448214846.53
Total owner’s equity (or 3194810 0624.56 37227604311.83
shareholder’s rights and
interests)
Total liabilities and owner’s 44918047444.84 49106333416.05
equity (or shareholder’s rights
and interests)
Legal representative: Fan Hongwei
Person in charge of financial function: Liu Xuefen
Prepared by (person in charge of the accounting firm): Zheng Minxia
Consolidated Income Statement January to June 2021
Unit: yuan Currency: CNY
Item Note Half year 2021 Half year 2020
I. Total operating revenue 104574477968.28 67357935162.99
Including ： Operating re venue 104574477968.28 67357935162.99Interest income
Earned insurance premium
Fee and commission incomes
II. Total operating cost 93870777498.52 59891056010.27
Including ： Operating cost 88606157035.69 54256726443.98Inter est expenses
Fee and commission expenses
Refunded premiums
Net amount of compensation payout
Net amount of allotment of reserves
for insurance liabilities
Policy dividend payment
Reinsured expenses
Taxes and surcharges 942830057.89 1021909803.98
Selling expenses 112155781.37 542587130.06
Administrative expenses 929877003.94 87069261 5.21
Research and development expenses 423005210.99 379098796.08
Financial expense 2856752408.64 2820041220.96
Including ： Interest expenses 2712601519.40 2523778695.6553
Interest income 58911453.98 62440582.53
Add: Other income 255643642.92 123425202.30
Investment gains ( “ -”for loss ) -213968734.97 -4192185.35
Including: Gains from investment in
associates and joint ventures
Income on derecognition of financial
assets at amortized cost ( “ -”for loss )
Foreign exchange gains ( “ -”for loss )
Gains from net hedging exposure
( “ -”for loss )
Gains from changes in fair value 304288 424.25 -53659648.69
( “ -”for loss )
Credit impairment loss ( “ -”for loss ) -25703092.89 -3402835.21
Assets impairment loss ( “ -”for loss )
Gains form disposal of assets ( “-”for -39515.06 -62773.92
loss )
III. Operating profit ( “ -”for loss ) 11023921194.01 7528986911.85
Add: Non -operating income 7811806.27 2460654.59
Less: Non -operating expenses 6472626.14 29666546.07
IV. Total profit ( “ -”for total loss ) 11025260374.14 7501781020.37
Less: Income tax expenses 2385409708.11 1955723 792.72
V. Net profit ( “ -”for net loss ) 8639850666.03 5546057227.65
( I ) Classified by continuity of operations
1.Net profit from continuing
operations “ -”for net loss 8639850666.03 5546057227.65 （ ）
2.Net profit from discontinued
operation （ “ -”for net loss ）
( II ) Classified by attribution to ownership
1.Net profit attributable to
shareholders of the parent company 8642207124.21 5516860000.15
( “ -”for net loss )
2. Net profit attributable to minority -235 6458.18 29197227.50
interests ( “ -”for net loss )
VI. Other comprehensive -74444688.15 13823417.25
income -after tax
( I ) Other comprehensive income-after -73977391.30 13823110.15
tax attributable to owners of the
parent company
1. Other comprehensive income not
reclassi fied into profit or loss
subsequently
( 1 ) Changes in remeasurement of
defined benefit plan
( 2) Share of other comprehensive
income of the equity method
investments not transferred to loss or
benefit
( 3) Changes in fair value of other
equity ins truments investment
( 4) Changes in fair value of the
company’s own credit risks
2. Other comprehensive income that -73977391.30 13823110.15
will be reclassified into profit or loss
subsequently
( 1 ) Share of other comprehensive54
income of the e quity method
investments transferrable to profit or
loss
( 2) Changes in fair value of other
debts investment
(3) Resulted amount on
reclassification of financial assets in
other comprehensive income
( 4) Credit impairment reserve of
other debts investment
( 5) Reserve for cash flow hedging -89024986.83
( 6) Translation differences arising 15047595.53 13823110.15
from translation of foreign currency
financial statements
( 7) Other
( II ) Other comprehensive -467296.85 307.10
income -after tax attributa ble to
minority interests
VII. Total comprehensive income 8565405977.88 5559880644.90
( I ) Total comprehensive income
attributable to owners of the parent 8568229732.91 5530683110.30
company
( II ) Total comprehensive inco me -2823755.03 29197534.60
attributable to minority interests
VIII Earnings per share ：
( I ) Basic earnings per share 1.23 0.79
( yuan /share)
( II ) Diluted earnings per share 1.23 0.79
( yuan /share)
For business merger involving enterprises under common control in this period the net profit realized by the
mergered enterprise before merger date was RMB 0 and the net profit of the mergered in previous period was 0
yuan.Legal representative: Hongwei Fan
Person in charge of financial function: Xuefen Liu
Prepared by (person in charge of the accounting firm): Minxia Zheng
Parent Company’s Income Statement January to June 2021
Unit: yuan Currency: CNY
Item Note Half year 2021 Half year 2020
I. Operating revenue 530229675.19 21354812 01.37
Less： Operating cos t 530229675.11 2134214917.37Taxes and surcharges 4997083.21 8040.00
Selling expenses
Administrative expenses 60324479.74 82485315.64
Research and development expenses
Financial expense 39827355.22 460 94050.07
Including ： Interest expenses 37047554.95 46076428.19Interest income 199390.78 157737.87
Add: Other income 1248904.41 608910.87
Investment gains ( “ -”for loss ) 570000000.00
Including: Gains from investment in
associates and joi nt ventures
Income on derecognition of financial55
assets at amortized cost ( “ -”for loss )
Gains from net hedging exposure
( “ -”for loss )
Gains from changes in fair value
( “ -”for loss )
Credit impairment loss ( “ -”for loss ) 229817.95
Assets impairment loss ( “ -”for loss ) 16792.01
Gains form disposal of assets ( “ -”for
loss )
II. Operating profit ( “ -”for loss ) - 103670195.73 443304581.17
Add: Non -operating income
Less: Non -operating expenses
III. Total profit ( “ -”for loss ) - 103670195.73 443304581.17
Less: Income tax expenses
IV. Net profit ( “ -”for loss ) - 103670195.73 443304581.17
( I ) Net profit from continuing - 103670195.73 443304581.17
operations ( “ -”for loss )
( II ) Net profit from discontinued
operation ( “ -”for loss )
V. Other comprehensive incomeafter
tax
( I ) Other comprehensive income not
reclassified into profit or loss
subsequently
1. Changes in remeasurement of
defined benefit plan
2. Share of other comprehensive
income of the equity method
investments not transferrable to profit
or loss
3. Changes in fair value of other equity
instruments investment
4. Changes in fair value of the
company’s own credit risks
( II ) Other comprehensive income that
will be reclassified into pro fit or loss
subsequently
1. Share of other comprehensive
income of the equity method
investments transferrable to profit or
loss
2. Changes in fair value of other debts
investment
3. Resulted amount on reclassification
of financial assets in ot her
comprehensive income
4. Credit impairment reserve of other
debts investment
5. Reserve for cash flow hedging
6. Translation differences arising from
translation of foreign currency
financial statements
7. Other
VI. Total comprehensi ve income - 103670195.73 443304581.17
VII. Earnings per share ：
56
( I ) Basic earnings per
share(RMB /share)
( II ) Diluted earnings per
share(RMB /share)
Legal representative: Fan Hongwei
Person in charge of financial function: Liu Xuefen
Prepared by (person in charge of the accounting firm): Zheng Minxia
Consolidated Cash Flows Statement January to June 2021
Unit: yuan Currency: CNY
Item Note Half year 2021 Half year 2020
I. Cash flows from operating
activities ：
Cash received from sale of goods or
rendering of service s 121336796594.74 75044380622.31
Net increase of deposits from
customers and other banks or financial
institutions
Net increase in borrowings from
central bank
Net increase of loans from other
financial institutions
Cash received from receiving
insurance premium of original
insurance contract
Net cash received from reinsurance
business
Net increase of policy holder deposits
and investment funds
Cash received from interests fees and 6775715.53
commissions
Net increase o f loans from other banks
Net increase in repurchase business
capital
Net cash received as securities trading
agency
Tax refund received 377285547.43 137938255.70
Other cash received relating to
operating activities 4680550279.24 5648 618722.34
Sub -total of cash inflows in operating
activities 126401408136.94 80830937600.35
Cash paid for goods and services 97329857577.48 52771778399.12
Net increase of customer's loans and
advances
Net increase in deposits with cen tral
bank and other financial institutions
Cash paid for indemnity of original
insurance contract
Net i ncrease of loans to other banks
Cash paid for interests fees and
commission
Cash paid for policy dividends
Cash paid to and on behalf of
employees 1791442952.25 1448240876.5357
Payments of all types of taxes 4850929047.89 3342096 708.89
Other cash paid relating to operating
activities 6249086242.03 5076499059.42
Sub -total of cash outflows in
operating activities 110221315819.65 62638615043.96
Net cash flows from operating
activities 16180092317.29 1819232255 6.39
II. Cash flows from investing
activities:
Cash received from disposal of
investments 1487381281.74 294681847.02
Cash received from returns on
- 7948373.71
investments
Net cash received from disposal of
fixed assets intangible assets a nd 22511819.35 313987.66
other long -term assets
Cash received from disposal of
subsidiaries and other business units
Other cash received relating to
investing activities 52697368.27 5780678376.49
Sub -total of cash inflows in
investment act ivities 1562590469.36 6083622584.88
Cash paid to acquire fixed assets
intangible assets and other long -term 6131235998.99 21451791614.04
assets
Cash paid to investments 409610909.09 558665655.99
Net increase in pledge loans
Cash paid to acquire subsidiaries and
other business units
Other cash paid relating to investing
activities 758138087.78 4555332452.45
Sub -total of cash outflows in
investment activities 7298984995.86 26565789722.48
Net cash flows from invest ing
activities -5736394526.50 -20482167137.60
III. Cash flows from financing
activities：
Cash received from capital 350000000.00
contribution
Include: Cash received from
investment by minority interests
Cash received from borrowings 37359186600.89 42118941072.69
Cash received relating to other
financing activitie s 9178551971.75 1616145339.17
Sub -total of cash inflows in financing
activities 46887738572.64 43735086411.86
Cash repayments of amounts
borrowed 45649179138.01 31314021139.92
Cash payments for interest expenses
and distribution of dividends or profits 7674059813.50 5326006707.76
Include: Dividend paid to minority
interests of subsidiaries 12998.00
Other cash payments relating to
financing activities 2266232032.93 698587182.80
Sub -total of cash outflows in
financin g activities 55589470984.44 37338615030.4858
Net cash flows from financing
activities -8701732411.80 6396471381.38
IV. Effect of foreign exchange rate
changes on cash and cash -244791212.05 -155999853.07
equivalents
V. Net increase in cash and cash
equivalents 1497174166.94 3950626947.10
Add: Opening balance of cash and
cash equivalent 11494116327.37 10792982727.36
VI. Closing balance of cash and cash
equivalent 12991290494.31 14743609674.46
Legal representative: Fan Hongwei
Person in charge of financial function: Liu Xuefen
Prepared by (person in charge of the accounting firm): Zheng Minxia
Parent Company’s Cash Flows Statement January to June 2021
Unit: yuan Currency: CNY
Item Note Half year 2 021 Half year 2020
I. Cash flows from operating
activities ：
Cash received from sale of goods or 599164314.00 1524685093.21
rendering of services
Tax refund received
Other cash received relating to 767592.14
operating activities 999488574.88
Sub -total of c ash inflows in operating 1525452685.35
activities 1598652888.88
Cash paid for goods and services 125702398.24 1945850251.50
Cash paid to and on behalf of -2875501.22
employees 5731291.49
Payments of all types of taxes 124647363.60 8040.00
Other cash paid relating to operating 9632318.79
activities 540140214.92
Sub -total of cash outflows in 1952615109.07
operating activities 796221268.25
Net cash flows from operating -427162423.72
activities 802431620.63
II. Cash flows from investing
activities:
Cash received from disposal of
investments
Cash received from returns on 4829955000.00 2811967000.00
investments
Net cash received from disposal of
fixed assets intangible assets and
other long -term assets
Cash received from disposal of
subsidiaries and other business units
Other cash received relating to 29000000.00
investing activities
Sub -total of cash inflows in 2840967000.00
investment activities 4829955000.00
Cash paid to acquire fixed assets 32123.89
intangible assets and other long -term 666681248.5659
assets
Cash paid to investments 300000000.00 700000000.00
Cash paid to acquire subsidiaries and
other business units
Other cash paid relating to investing 60000000.00
activities
Sub -total of cash outflows in 760032123.89
investment activities 966681248.56
Net cash flows from investing 2080934876.11
activities 3863273751.44
III. Cash flows from financing
activities ：
Cash received from capital
contribution
Cash received from borrowings
Cash received relating to other 3240000000.00
financing activities 733525358.55
Sub -total of cash inflows in financing 3240000000.00
activ ities 733525358.55
Cash repayments of amounts
borrowed
Cash payments for interest expenses 5417404427.17 2776691365.67
and distribution of dividends or profits
Other cash payments relating to 213897 0332.73
financing activities
Sub -total of cash outflows in 4915661698.40
financing activities 5417404427.17
Net cash flows from financing - 1675661698.40
activities -4683879068.62
IV. Effect of foreign exchange rate
changes on cash and cash
equivalents
V. Net increase in cash and cash -21889246.01
equivalents -18173696.55
Add: Opening balance of cash and 82052267.79
cash equivalent 27650112.58
VI. Closing balance of cash and cash 60163021.78
9476416.03
equivalent
Legal representative: Fan Hongwei
Person in charge of financial function: Liu Xuefen
Prepared by (person in charge of the accounting firm): Zheng Minxia60
Consolidated Statement of Changes in Equity January to June 2021
Unit: yuan Currency: CNY
2021half year
Equity attributable to the parent company
Other equity instruments
Item
Paid-in
Capital Less: Other Ordinary
(or Share Preference Perpetual Capital shares bonds Other reserve Treasury comprehensive
Special Surplus
reserve reserve risk
Undistributed
profits Other Subtotal
Minority Total owners'
Capital) shares income reserve interests equity
I. Balance at 7039
099 18350 324811 -100823962.53 77581 743268 46905076 119314 47024390the end of
786.00 115179.65 781.18 307.23 339.04
21120648008.95 877.16 084.65 961.81
previous year
Add: Changes
in accounting -5201038.90 -5201038.90 -5201038.90
policies
Correction of
errors in
previous period
Business
merger under
common
control
Other
II. Balance in
beginning 7039
099 18350 324811 -100823962.53 77581 743268period of 115179.65 781.18 307.23 339.04 21115446970.05
46899875 119314 47019189
786.00 838.26 084.65 922.91
this year61
III. Movement
over the period 14436 -96185 -27449 3238174 -2823 3235351
( "- "for 233.62 188.00
-73977391.30 671.30 3228980439.45 798.47 755.03 043.44
decrease)
(I)Total
comprehensive -73977391.30 8642207124.21 8568229 -2823 8565405732.91 755.03 977.88
income
(II)
Shareholders'
contributions 14436 -96185 110621 110621233.62 188.00 421.62 421.62
and decrease
of capital
1. Ordinary
shares
contributed by
shareholders
2. Capital
contribution by
holders of
other equity
instruments
3. Increase in
shareholder's
equity resulted
from
share-based
payments
4. Other 14436 -96185 110621 110621233.62 188.00 421.62 421.62
(III)
Appropriation -5413226684.76 -5413226 -5413226684.76 684.76
of profits62
1．
Appropriation
to surplus
reserves
2.allotment
of ordinary
risk reserves
3.Distributions to -5413226684.76 -5413226 -5413226owners (or 684.76 684.76
shareholders)
4．Other
(IV) Transfer
within equity
1.Capital
reserves
converting into
capital (or
share capital)
2.Surplus
reserves
converting into
capital (or
share capital)
3.Surplus
reserves
covering
the deficit
4. Changes in
defined
benefits plan
transferred
to retained
earnings63
comprehensive
income
transferred to
retained
earnings
6．Other
(V) Special -27449 -27449
671.30 671.30 -27449671.30reserve
1．
Appropriation 87541 87541 87541421.06
for the period 421.06 421.06
2．Used for 114991 114991
the period 092.36 092.36 114991092.36
(VI) Other
IV. Balance at
the end of 7039 18364099 551 228626 -174801353.83 50131 743268 24344427 50138050 116490 50254540
the period 786.00 413.27 593.18 635.93 339.04 409.50 636.73 329.62 966.35
2020 half year
Equity attributable to the parent company
Other equity instruments
Item
Paid-in
Capital (or
Preference Perpetual Capital Less: Other Share
shares bonds Other Treasury comprehensive
Special Surplus Ordinary Undistributed
reserve reserve reserve risk reserve profits Other Subtotal
Minority Total
Capital) shares income interests owners' equity
I. Balance at 7039 18272 224841 690 36333 405the end of 099 358 448.45 13773146.4130392
119.18 326 10511894102.60 003 78436738
previous year 786.00 450.99 989.68 146.41 756.03
787902.4464
Add: Changes
in accounting
policies
Correction of
errors in
previous period
Business
merger under
common control
Other
II. Balance in
beginning period 7039 18272 224 690099 358 841 13773146.41 30392 326of this year 10511894
36333 405 36738
786.00 450.99 448.45 119.18 989.68 102.60 003146. 784756. 787902.4441 03
III. Movement
over the 144312 99970 2826
627.95 332.73 13823110.15
57375 -323 2502525
period ( "- "for 149.24
2710744 285
692.95 247.56 759388. 859.18
decrease) 38
(I)Total
comprehensive 13823110.15 5516860 5530 29197 5559880000.15 683110. 534.60 644.90
income 30
(II) Shareholders'
contributions
and decrease 144312 99970 44342 -352956 -308614627.95 332.73 295.22 922.98 627.76
of capital
1. Ordinary
shares
contributed by
shareholders
2. Capital
contribution
by holders
of other65
equity
instruments
3. Increase in
share-holder's
equity resulted
from
share-based
payments
4. Other 144312 99970 44342 -352956 -308614
627.95 332.73 295.22 922.98 627.76
(III)
Appropriation -2806115 -2806115 -2806115307.20 307.20
of profits 307.20
1．
Appropriation
to surplus
reserves
2. allotment
of ordinary
risk reserves
3. Distributions
to owners (or -2806115 -2806115 -2806115
shareholders) 307.20 307.20 307.20
4．Other
(IV) Transfer
within equity
1.Capital
reserves
converting into
capital
(or share capital)
2.Surplus
reserves
converting into66
capital (or share
capital)
3.Surplus
reserves
covering the
deficit
4. Changes in
defined benefits
plan transferred
to retained
earnings
5. Other
comprehensive
income
transferred to
retained
earnings
6．Other
(V) Special 57375 573751 57375149.reserve 149.24 49.24 24
1．Appropriation 70130 701306 70130616.for the period 616.90 16.90 90
2．Used for the 12755 127554 12755467.period 467.66 67.66 66
(VI) Other
IV. Balance at 70390 18416 324811 27596256.56 87767 690326 1322263879 391592 8202536 39241313
the end of the 99786. 671078 781.18 268.42 989.68 5.55 88393.9 7.65 761.62
period 00 .94 767
Parent Company’s Statement of Changes in Equity January to June 2021
Unit: yuan Currency: RMB
2021 half year
Paid-in Other equity instruments
Item Other
Capital Less: Treasury Special Undistributed Total owners'
Preference Perpetual Capital reserve comprehensive Surplus reserve
(Share Other shares reserve profits equity shares bonds income
Capital)
I. Balance at the 703909 23794748212.7 324811781.18 1270353247.7 5448214846.53 37227604311.8
end of previous 9786. 00 0 8 3
year
Add: Changes in
accounting
policies
Correction of
errors in
previous period
Others
II. Balance in 703909 23794748212.7 324811781.18 1270353247.7 5448214846.53 37227604311.8
beginning period 9786.00 0 8 3
of this year
III. Movement 141208005.22 -96185188.00 -5516896880.4 -5279503687.27
over the period 9
(“-”for decrease)
(I) Total -103670195.73 -103670195.73
comprehensive68
income
(II) 141208005.22 -96185188.00 237393193.22
Shareholders'
contributions
and decrease of
capital
1. Ordinary
shares
contributed by
shareholders
2. Capital
contribution by
holders of other
equity
instruments
3. Increase in
shareholder’s
equity resulted
from
share-based
payments
4. Other 141208005.22 -96185188.00 237393193.22
(III) -5413226684.7 -5413226684.76
Appropriation of 6
profits
1．Appropriation69
to surplus
reserves
2. Distributions -5413226684.76 -5413226684.76
to owners (or
shareholders )
3．Other
(IV) Transfer
within equity
1.Capital
reserves
converting into
capital (or share
capital)
2.Surplus
reserves
converting into
capital (or share
capital)
3.Surplus
reserves
covering the
deficit
4. Changes in
defined benefits
plan transferred
to retained70
earnings
5. Other
comprehensive
income
transferred to
retained earnings
6．Other
(V) Special
reserve
1．Appropriation
for the period
2．Used for the
period
(VI) Other
IV. Balance at 703909 23935956217.9 228626593.18 1270353247 .7 -68682033.96 31948100624.5
the end of period 9786.00 2 8 6
2020 half year
Paid-in Other equity instruments
Other
Item Capital Capital Less: Treasury Special Surplus Undistributed Total owners'
Preference Perpetual comprehensive
(Share Other reserve shares reserve reserve profits equity
shares bonds income
Capital)
I. Balance at 70390 23759278 224841448.4 75796534 3636814094.5 349683161271
the end of 99786. 351.37 5 2.25 5 5.72
previous year 00
Add: Changes
in accounting
policies
Correction of
errors in
previous
period
Others
II. Balance in 70390 23759278 224841448.4 75796534 3636814094.5 3496831612
beginning 99786. 351.37 5 2.25 5 5.72
period of this 00
year
III. Movement 74570241. 99970332.73 -2362810726. -2388210817
over the period 00 03 .76
(“-”for
decrease)
(I) Total 443304581.17 443304581.1
comprehensive 7
income
(II) 74570241. 99970332.73 -25400091.73
Shareholders’ 00
contributions
and decrease
of capital72
1. Ordinary
shares
contributed by
shareholders
2. Capital
contribution
by holders of
other equity
instruments
3. Increase in
share-holder's
equity resulted
from
share-based
payments
4. Other 74570241. 99970332.73 -25400091.7300
(III) -2806115307. -2806115307
Appropriation 20 .20
of profits
1．Appropriat
ion to surplus
reserves
2 Distributions -2806115307. -2806115307
to owners (or 20 .20
shareholders )73
3．Other
(IV) Transfer
within equity
1.Capital
reserves
converting into
capital (or
share capital)
2.Surplus
reserves
converting into
capital (or
share capital )
3.Surplus
reserves
covering the
deficit
4. Changes in
defined
benefits plan
transferred to
retained
earnings
5. Other
comprehensive
income74
transferred to
retained
earnings
6．Other
(V) Special
reserve
1．Appropriat
ion for the
period
2．Used for the
period
(VI) Other
IV. Balance at 70390 23833848 324811781.1 7579653 4 1274003368.5 3258010530
the end of the 99786. 592.37 8 2.25 2 7.96
period 00
Legal representative: Fan Hongwei
Person in charge of financial function: Liu Xuefen
Prepared by (person in charge of the accounting firm): Zheng Minxia75