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Sunday, 21 August 2016, 23:22 HKT/SGT

Source: Zhaojin Mining
Zhaojin Mining 2016 Interim Results Remains Stable
Revenue and Profit Attributable to Owners of the Parent Rose 20.82% and 13.07% Respectively;
Deepening Reform and Innovation Achieving Rise in Both Output and Benefit

HONG KONG, Aug 21, 2016 - (ACN Newswire) - Zhaojin Mining Industry Company Limited ("Zhaojin Mining" or the "Company", stock code: 1818, together with its subsidiaries, the "Group"), a leading gold enterprise in the PRC, announced its interim results for the six months ended 30 June 2016 (the "period under review").

In the first half of 2016, the hedge function of gold was amplified under the joint effects of various factors such as the rate hike delay by the US Federal Reserve, the weaken US dollar, the slumped stock markets worldwide, the Brexit, the expectation of further rise in inflation as well as other abrupt incidents. Large amounts of capital flooded in the gold market, driving the gold price up rapidly. The Group maintained a stable operation and captured the market opportunity, achieving rise in both output and benefit. For the six months ended 30 June 2016, the Group's revenue was approximately RMB 3,234,800,000, representing a rise of 20.82% compared with the same period last year. Gross profit was RMB1,408,612,000, representing a rise of 26.88% compared to the same period of 2015 and gross profit margin was 43.55% (First half of 2015: 41.47%). Net profit was RMB274,552,000, representing a year-on-year increase of 24.29%. Profit attributable to owners of the parent amounted to RMB 254,557,000, representing a growth of 13.07% over the same period of 2015. Basic and diluted earnings per share were RMB 0.09.

Mr. Weng Zhanbin, Chairman of Zhaojin Mining Industry Company Limited, remarks, "In the first half of 2016, affected by the weak global economy and geopolitical instability, the price of the gold is strong. The Group grasped tightly the favorable opportunity of rising gold price, intensified the production organization scheduling, optimized the production process system, and continuously activated the production vitality and efficiency. Meanwhile, we also further reinforced the production capacity pattern, deepened reform and innovation projects, strengthened project construction and resources occupation, to further expand development potential and space of enterprises."

During the period under review, the Group created another new high in the half-year output of self-produced gold. As of June 30, 2016, its total output of gold accumulated to 18,490.87 kg (approximately 594,494.79 ozs), representing an increase of approximately 11.60% as compared to the same period of last year. Among which, 10,422.53kg (approximately 335,091.92 ozs) was mine-produced gold, 8,068.34 kg (approximately 259,402.87 ozs) was smelted and processed gold. The Group's productive mines grew obviously outside the province, and achieved the self-produced gold output of 4,391 kg (approximately 141,178.09 ozs), increasing by 24% on a year-on-year basis, which has become an important growth pole supporting the growth of its production capacity and benefit. In terms of resources occupation, the Group invested the mineral prospecting and development funds of RMB57.62 million in the first half of the year, and realized the phased targets smoothly, with 25.856 tons of gold metals and 788 tons of copper metals newly increased.

Regarding management and technology innovation, as guided by the reform and innovation strategy, the Group promoted the management, innovation and transformation projects comprehensively in the first half of 2016. It further innovated upon the internal market-oriented operation and management system, adopted the contractor operation and management comprehensively in various mining enterprises, and carried out deeply the activities of organizational downsizing, streamlining administration and delegating power, benchmarking management, audit supervision and management, specialized support and assistance, etc. Meanwhile, it promoted the "Total Optimizational Production-Supporting Systems" management, which further stimulated the business operation image of enterprises and the enthusiasm and creativity of all employees, and continuously intensified the atmosphere of starting business and striving for excellence. In terms of technological innovation, the Group implemented ten innovation projects and ten scientific research projects, applied for 23 new patents, obtained 18 new authorized patents, and applied for 12 municipal and provincial-level science and technology progress awards. The project of "National Science & Technology Supporting Plan during the Twelfth Five year Plan Period - Gold Ore Short-Process Floating-Grinding Technology" undertaken by the Company has passed the national acceptance smoothly, with output value of more than RMB300 million every year.

As for infrastructure and technology projects, the Group attached great importance to 29 construction projects this year, among which 8 infrastructure projects were completed on schedule and 12 deep production continuation projects were implemented smoothly as scheduled, which accumulated strength for the improvement of productivity and efficiency; Ore Dressing Plant Transformation Project of Dayingezhuang Gold Mine, Smelting Plant Transformation Project of Xinhui Copper, and Ore Dressing Process Transformation Project of Sanfengshan Gold Mine have been completed smoothly and put into trial production in advance. The enterprises accomplished the management benefits of RMB8.97 million by means of solution review, contract management and quality assessment, and saved the project funds of more than RMB18 million from price reduction of outsourced shaft sinking and drifting projects.

As for safety and environmental protection, the Group vigorously implemented the strategy of safety promotion by science and technology, actively promoted mechanization, automation, informatization and intelligence, further achieved the targets of "substituting people by mechanization and decreasing people by automation", and continually carried out comprehensive safety renovation actions, with more than RMB50 million withdrawn and used totally. In terms of ecology and environmental protection, it actively conducted green mine construction activities, and planted trees widely in the mining areas, with more than 30 hectares of greening areas newly increased. Hence, the Group has fulfilled the development philosophy of "developing a new mine and preserving a green land" with physical actions.

Looking forward, in the second half of the year, the Group will continue to improve production efficiency and quality, and develop competence for delicacy management for increasing income and reducing expenditure. The Group will also truly strengthen risk control and enhance the enterprise's anti-risk capability, carry out key projects elevating activities, and realize new breakthroughs in project construction, geological exploration and overseas development. It will grasp current favorable market opportunities and accelerate the integration of peripheral resources and provide new resource reserves for enterprise development. Lastly, the Group will highly emphasize safety, environmental protection and ecology, and implement the development philosophy of "developing a new mine and preserving a green land".

Mr. Weng Zhanbin concluded, "In the second half of 2016, amid the uncertainties brought about by the profound reform in the global politic and economic environment, the price trend of both the gold and commodity prices will be affected by various factors. However, challenges and opportunities have always co-exist. The rebound of the gold price suggests a critical period for the Group to optimize the production arrangement, improve cost effectiveness and speed up development. The Group will spare no effort to rectify the weaknesses and take various measures to ensure that the annual profit target can be over-fulfilled, and all the systematic and fundamental risk countermeasures will be in place for the harmonious and stable development of the Group, thus delivering a rewarding performance to shareholders."

Aug 21, 2016 23:22 HKT/SGT
Topic: Press release summary
Sectors: Metals/Mining, Daily Finance, Daily News
From the Asia Corporate News Network

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