Interim Report 2024

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# Interim Report 2024

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# Interim Report 2024
年報 A nnual Repor t
2023 2023
Annual Report 2023 年報
Integrate Resources,
整合資 源，創 造 價 值 Create Values,
創 造 效 益，回 報 社會 Build Benefits
And Contribute To The Society
Content
Corporate Information 1
Chairman’s Statement 2
Management Discussion and Analysis 4
Biographical Information of Directors and Senior Management 26
Corporate Governance Report 29
Directors’ Report 41
Independent Auditor’s Report 50
Consolidated Statement of Profit or Loss and 54
Other Comprehensive Income
Consolidated Statement of Financial Position 55
Consolidated Statement of Changes in Equity 57
Consolidated Statement of Cash Flows 58
Notes to the Consolidated Financial Statements 60
Summary Financial Information 129
Corporate Information
DIRECTORS REGISTERED OFFICE
Executive Directors: Harneys Fiduciary (Cayman) Limited
Gao Mingqing (Chairman, Chief Executive Officer) 4th Floor, Harbour Place,
Liu Zhichun 103 South Church Street,
Wang Renxiang P.O. Box 10240,
Wang Nan Grand Cayman KY1-1002,
Cayman Islands
Independent non-executive Directors:
Tsang Wai Hung CAYMAN ISLANDS SHARE REGISTRAR
Wong Chi Ming Ming AND TRANSFER OFFICE
Wang Xin Maples Fund Services (Cayman) Limited
PO Box 1093, Boundary Hall
AUDIT COMMITTEE Cricket Square Grand Cayman KY1-1102
Tsang Wai Hung (Chairman) Cayman Islands
Wong Chi Ming Ming
Wang Xin HONG KONG BRANCH SHARE
REGISTRAR
REMUNERATION COMMITTEE Tricor Investor Services Limited
Wong Chi Ming Ming (Chairman) 17/F, Far East Finance Centre
Liu Zhichun 16 Harcourt Road
Wang Xin Hong Kong
NOMINATION COMMITTEE AUDITOR
Tsang Wai Hung (Chairman) KTC Partners CPA Limited
Wong Chi Ming Ming Certified Public Accountants
Wang Xin 1305-07, 13/F., New East Ocean Centre,
9 Science Museum Road,
COMPANY SECRETARY Tsimshatsui East, Kowloon,
Wong Chi Wah (HKICPA, FCCA) Hong Kong
HEADQUARTER AND PRINCIPAL PLACE LEGAL ADVISER
OF BUSINESS IN THE PRC as to Hong Kong Law
Xinzhuang Township Yifeng County Dentons Hong Kong LLP
Jiangxi Province 3201 Jardine House
PRC 1 Connaught Place Central
Hong Kong
PRINCIPAL PLACE OF BUSINESS
IN HONG KONG PRINCIPAL BANKER
Unit 1, 28/F Bank of China, Yifeng Branch
Singga Commercial Centre 144-151 239 Xinchang West Street
Connaught Road West Yifeng County
Hong Kong Jiangxi Province
PRC
STOCK CODE
3939
COMPANY WEBSITE
www.wgmine.com
Wanguo International Mining Group Limited
1
Annual Report 2023
Chairman’s
Statement
Dear Shareholders,
On behalf of the board (the “Board”) of Directors (the “Directors”, each a “Director”) of Wanguo International Mining
Group Limited (the “Company”), I am pleased to present the audited results of the Company and its subsidiaries (collectively
referred to as the “Group”) for the financial year ended 31 December 2023.
For the year ended 31 December 2023, the Group mined 1,076,021 tonnes of ores in our Xinzhuang Mine, of which it sold
copper in copper concentrates of 3,709 tonnes, iron concentrates of 80,938 tonnes, zinc in zinc concentrates of 8,390 tonnes,
sulfur concentrates of 238,580 tonnes, lead in lead concentrates of 1,721 tonnes, sulfur and iron concentrates of 46,736
tonnes, gold of 241 kg, silver of 12,403, copper of 360 kg and zinc of 310 kg. The Group also mined 1,466,571 tonnes of
ores in our Gold Ridge Mine, of which it sold 1,142.90 kg gold doré and 23,638.83 tonnes of gold concentrates. We achieved
revenue of RMB1,315.2 million, gross profit of RMB619.2 million and profit attributable to owners of the Company of
RMB335.4 million.
Xinzhuang Mine in Jiangxi Province has achieved a stable production scale for three consecutive years, and has attained a
new level of technological research and development and innovation level. This results in creating a “boutique mine” and
pursuing further quality improvement and efficiency enhancement.
Our Gold Ridge Mine in Solomons Islands has overcome a series of difficulties at the end of last year, by focusing on
production and equipment and process adjustment and transformation, the production efficiency continues to improve.
Looking forward, our Gold Ridge Mine will become one of world-class gold mines, after gaining a deeper and more
comprehensive understanding of the mine in the past years. After the first phase of production, we will carry out the second
phase of expansion, which will contribute continuous, stable and efficient performance growth to the group!
The “exploration to mining” procedures for the Walege lead-silver mine in Tibet have made substantial progress. We strive to
submit all the pre-approval materials for mining license to the government approval department in the first quarter of 2024.
This large-scale and high-quality lead-silver mine will add a new momentum to the Group’s subsequent growth.
On behalf of the Group, I would like to take this opportunity to express my sincere gratitude to all of our customers, business
partners and investors for their support and trust to the Group. In addition, I would like to express my heartfelt thanks to our
Directors and employees for their dedication and contribution to the Group.
By order of the Board
Gao Mingqing
Chairman and Chief Executive Officer
18 March 2024
Wanguo International Mining Group Limited
3
Annual Report 2023
Management
Discussion and Analysis
MARKET REVIEW
Copper
In 2023, major Western economies such as Europe and the United States experienced sustained high inflation, with an
extended period of interest rate hikes for the US dollar. At the same time, global refined copper production saw significant
growth driven by China. Despite the boost from the high growth in the new energy industry, copper consumption was still
hindered by the drag from traditional manufacturing, leading to an oversupply of refined copper globally. As a result, copper
prices showed a trend of overall fluctuation and decline after reaching a peak in January. The highest price for London
Metal Exchange (LME) copper was US$9,550 in mid-January, and the lowest was US$7,856 in late October, rebounding to
above US$8,500 by the end of the year. Meanwhile, Shanghai Future Exchange (SHFE) copper, influenced by a significant
depreciation of the Chinese yuan in the second half of the year, exhibited a pattern of fluctuation at high levels, with the
highest price at RMB71,500 in mid-January and the lowest at RMB62,690 in late May, mostly fluctuating within the range of
RMB66,000 to RMB70,000 during the year.
Wanguo International Mining Group Limited
4
Annual Report 2023
MARKET REVIEW (Continued)
Iron
In 2023, the iron ore market experienced significant fluctuations, initially dropping and then rising. From January to March,
optimistic market expectations following the relaxation of pandemic control measures led to a continuous increase in iron ore
prices. However, by the end of March, steel demand did not pick up as expected during the traditional peak season, coupled
with lower-than-expected demand and increased macroeconomic risks overseas, resulting in a sharp decline in iron ore prices
as steel mill profits turned negative.
After entering May, market expectations of policy implementation, along with the recovery of steel mill profits after
production cuts, a rebound in iron production, deep discounts in iron ore futures, and the anticipation of policy measures, led
to a bottoming out and rebound in iron ore prices.
By July, iron production remained high, and there were rumors of implementing controls on crude steel production, causing a
significant drop in iron ore prices. However, the rumors were later proven false, and with high iron production, low steel mill
inventories, continuous decline in port inventories, and frequent positive macroeconomic news, iron ore prices continued to
rise, reaching new highs.
Zinc
At the beginning of the year, the LME three-month zinc price opened at US$2,992 per ton. Data released by the United States
fueled market expectations of a slower pace of interest rate hikes by the Federal Reserve, causing the US dollar index to
decline and zinc prices to rise to a year-high of US$3,512 per ton. Subsequently, the turmoil in Silicon Valley banks and the
crisis at Credit Suisse, combined with the Federal Reserve signaling continued interest rate hikes, a series of economic data
releases, and the impact of the US debt crisis, led to a rise in market risk aversion. The US dollar index climbed, and London
zinc prices consecutively fell to a yearly low of US$2,215 per ton in May 2023. As a large new mine, the Ozer lead-zinc mine
in Russia, caught fire, concerns about the supply side emerged. Meanwhile, US inflation rate grew slower than expected, and
retail data exceeded expectations, providing support for an economic soft landing. The US dollar index plummeted, and zinc
prices stabilized, ultimately closing at US$2,662 per ton. The average price of LME three-month zinc in 2023 was US$2,651
per ton, a 23% decrease compared to the previous year.
Wanguo International Mining Group Limited
5
Annual Report 2023
Management Discussion and Analysis
MARKET REVIEW (Continued)
Lead
In 2023, the enthusiasm for fund participation increased, coupled with the rising production costs in the lead industry chain,
leading to increased volatility in lead prices. The LME March lead futures showed wide fluctuations around inventory
liquidity risks, with greater volatility than Shanghai lead. At the beginning of 2023, as the Bloomberg Commodity Index
(BCOM) fund’s positioning neared completion and the market’s expectations for the Fed’s slowing interest rate hikes
diminished, London lead fluctuated weaker. The March “Silicon Valley Bank Collapse” triggered concerns about a crisis in
the European and American banking industry, causing panic and denting confidence in the non-ferrous market. In addition,
the strong stickiness of the inflation index announced by the United States in May 2023, coupled with hawkish comments
from Fed officials on interest rate hikes, supported the rebound of the US dollar index, leading to further decline in London
lead, reaching a low of US$1,976 per ton. However, due to the historical low levels of LME lead inventories and the
continuous increase in concentration of positions, LME 0-3 spot premiums rose, forming resonance with the fundamentals
and funds, pushing LME lead prices to a high of US$2,308.5 per ton. At the end of 2023, LME inventories continued to rise,
with high positions falling, and the position-to-inventory ratio also dropping to a low level, gradually alleviating liquidity
risks, ultimately closing at US$2,067 per ton, a 9.8% decrease year-on-year. In 2023, the average price of LME March lead
futures was US$2,128 per ton, a 0.8% decrease year-on-year; during the same period, the average price of LME spot lead was
US$2,137 per ton, a 0.7% decrease year-on-year.
Gold and Silver
In 2023, Commodity Exchange (COMEX) gold futures recorded overall gains in the first and fourth quarters, with some
pullback in the second and third quarters. However, the overall trend for the year remained at a high level.
Specifically, in the first quarter, a sudden crisis in the European and American banking industry pushed up the price of gold,
with COMEX gold futures briefly surging to US$2,083.8 per ounce, marking the first historical high of the year.
In the second and third quarters, as market risk events were digested and US inflation data continued to decline, the
gold price retreated from its high levels and came under pressure, with a cumulative decline of over 8% due to ongoing
disturbances in interest rate expectations.
However, in the fourth quarter, geopolitical tensions resurged, leading to a significant surge in gold prices and another
historical high. On 4 December 2023, the price reached US$2,152.3 per ounce, setting a new record once again.
Due to limited s

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