ANNUAL REPORT 2019 Annual Report 2019 CONTENTS
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ANNUAL REPORT 2019 Annual Report 2019 CONTENTS Corporate Information 2 Definition 3 Company Profile 5 CEO’s Statement 6 Performance Overview 9 Management Discussion 13 and Analysis Corporate Governance Report 50 Biography of Directors 66 Directors’ Report 75 Environmental, Social and 100 Governance Report Independent Auditor’s Report 133 Consolidated Statement of 138 Profit or Loss Consolidated Statement of 139 Comprehensive Income Consolidated Statement of 140 Financial Position Consolidated Statement 142 of Changes in Equity Consolidated Statement of Cash Flows 144 Notes to Financial Statements 146 CORPORATE INFORMATION BOARD OF NOMINATION HEAD OFFICE AND DIRECTORS COMMITTEE PRINCIPAL PLACE OF BUSINESS IN CHINA Chairman and Mr. Zhang Yichen (Chairman) Vice-chairman Mr. Chow Siu Lui 8/F, Zhongyi Tower Mr. Liao Xinbo# Mr. Zhang Yichen (Chairman) No. 6 Xizhimenwai Avenue Mr. Kong Wei## Ms. Peng Jiahong Xicheng District (Vice-chairwoman) Beijing, China STRATEGY Executive Directors COMMITTEE SHARE REGISTRAR Ms. Peng Jiahong Ms. Peng Jiahong Computershare Hong Kong (Chief Executive Officer) (Chairwoman) Investor Services Limited Mr. Yu Gang Mr. Zhang Yichen Shops 1712-1716, 17th Floor Ms. Liu Kun Hopewell Centre Non-executive 183 Queen’s Road East Directors RISK CONTROL Wan Chai Hong Kong Mr. Zhang Yichen COMMITTEE Ms. Liu Kun Mr. Su Guang (Chairman) AUDITOR Mr. Liu Zhiyong Mr. Liu Zhiyong Mr. Liu Xiaoping Ms. Peng Jiahong Ernst & Young Mr. Su Guang LEGAL ADVISER Independent Non- COMPANY SECRETARY executive Directors Wilson Sonsini Goodrich & Rosati Mr. Li Yinquan Ms. Ng Wai Kam* Mr. Chow Siu Lui Ms. Lui Mei Yan Winnie** PRINCIPAL BANKERS Mr. Han Demin Ms. Cheng Pik Yuk*** Bank of Communications, Beijing Mr. Liao Xinbo# Fuwai Subbranch Mr. Kong Wei## AUTHORISED Bank of China (Hong Kong) REPRESENTATIVES Limited AUDIT COMMITTEE Ms. Peng Jiahong Mr. Li Yinquan (Chairman) Ms. Ng Wai Kam* COMPANY’S Mr. Liu Xiaoping Ms. Lui Mei Yan Winnie** WEBSITE Mr. Chow Siu Lui Ms. Cheng Pik Yuk*** www.universalmsm.com REGISTERED OFFICE REMUNERATION STOCK CODE COMMITTEE Room 702, Fairmont House 8 Cotton Tree Drive 2666 Mr. Chow Siu Lui (Chairman) Central Mr. Liu Zhiyong Hong Kong Mr. Han Demin # Appointed with effect from 2 December 2019 ## Resigned with effect from 18 September 2019 * Appointed with effect from 31 December 2019 ** Appointed with effect from 5 June 2019 and resigned with effect from 31 December 2019 *** Resigned with effect from 5 June 2019 2 Genertec Universal Medical Group Company Limited DEFINITION “2020 AGM” the annual general meeting of the Company to be held on 9 June 2020 “Ansteel General Hospital” Ansteel Group General Hospital (鞍鋼集團公司總醫院) “Ansteel Group” Ansteel Group Corporation Limited (鞍鋼集團有限公司) “Articles” the Company’s articles of association “Audit Committee” the audit committee of the Board “Board” or “Board of the board of directors of the Company Directors” “CEC” China Electronics Corporation(中國電子信息產業集團有限公司) “CEC Caihong” CEC Caihong Group Co., Ltd. (咸陽中電彩虹集團控股有限公司) “CG Code” the “Corporate Governance Code” contained in Appendix 14 to the Listing Rules “Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of Hong Kong), which has become effective from 3 March 2014, as amended, supplemented or otherwise modified from time to time “Company” or “Universal Genertec Universal Medical Group Company Limited (通用環球醫療集團有 Medical” 限公司) (formerly known as Universal Medical Financial & Technical Advisory Services Company Limited (環球醫療金融與技術咨詢服務有限公司), Universal Medical Services & Health Management Company Limited (環球醫療服務有 限公司) and Universal International Leasing Co., Limited (環球國際租賃有限 公司)), a company incorporated with limited liability under the laws of Hong Kong on 19 April 2012 “controlling shareholder” has the meaning ascribed thereto under the Listing Rules “CRFG” China Railway First Group Co., Ltd.(中國中鐵一局集團有限公司) “CR State Asset” China Railway State Asset Management Co., Ltd. (中鐵國資資產管理有限 公司) “CULC” China Universal Leasing Co., Ltd. (中國環球租賃有限公司), a wholly foreign- owned enterprise incorporated in China on 1 November 1984 and a wholly- owned subsidiary of the Company “CVA” cerebral vascular accident “Director(s)” the director(s) of the Company “Evergreen” Evergreen021 Co., Ltd, a company incorporated under the laws of the British Virgin Islands on 14 August 2014 with limited liability “Group”, “we” or “us” the Company and its subsidiaries “GT-HK” Genertec Hong Kong International Capital Limited (通用技術集團香港國際 資本有限公司), a company incorporated under the laws of Hong Kong on 24 March 1994 with limited liability, an indirect wholly-owned subsidiary of GT-PRC, and one of the controlling shareholders of the Company “GT-PRC” China General Technology (Group) Holding Company Limited (中國通用技術 (集團)控股有限責任公司), which is a state-owned enterprise under the direct administration of the PRC central government, the controlling shareholder of the Company “HKD” Hong Kong dollars, the lawful currency of Hong Kong 2019 Annual Report 3 DEFINITION “Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China “Hospital Investment Co., Genertec Universal Hospital Investment & Management (Tianjin) Co., Ltd. Ltd.” or “Wiseman” (通用環球醫院投資管理(天津)有限公司), previously known as Wiseman Hospital Investment Management (Tianjin) Co., Ltd. (融慧濟民醫院投資管理 (天津)有限公司), a wholly-owned subsidiary of the Company established in the PRC in 2015 “Listing Rules” the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, as amended or supplemented from time to time “Model Code” the Model Code for Securities Transactions by Directors of Listed Issuers contained in Appendix 10 to the Listing Rules “Nomination Committee” the nomination committee of the Company “Pangang Group” Panzhihua Iron and Steel (Group) Company Limited (攀鋼集團有限公司) “Pangang Mining” Panzhihua Pangang Group Mining Company (攀鋼集團礦業有限公司) “PRC” or “China” The People’s Republic of China, for the purpose of this report, excluding Hong Kong, Macau and Taiwan “Prospectus” the prospectus issued by the Company on 24 June 2015 “Qianshan Hot Spring Qianshan Hot Spring Sanatorium of Ansteel General Hospiral Sanatorium” “Remuneration Committee” the remuneration committee of the Board “Risk Control Committee” the risk control committee of the Board “RMB” Renminbi, the lawful currency of the PRC “Securities Dealing Code” the Company’s own code of conduct regarding directors’ and employees’ dealings in the Company’s securities “SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), as amended or supplemented from time to time “Share(s)” ordinary share(s) in the share capital of the Company “Share Option Scheme” the share option scheme adopted by the Company on 31 December 2019 “Shareholder(s)” holder(s) of Shares “SOE” State-owned enterprise “Stock Exchange” The Stock Exchange of Hong Kong Limited “Strategy Committee” the strategy committee of the Board “USD” United States dollars, the lawful currency of the United States “Xi’an Aero-Engine Genertec Universal Xi’an Aero-Engine Hospital (Xi’an) Co., Ltd. (通用環球西 Hospital” 航醫院(西安)有限公司) “Yangmei Hospital Shanxi Yangmei General Hospital Medical Management Co., Ltd. (山西陽煤 Management” 總院醫療管理有限公司) “Yang Quan Coal Industry” Yang Quan Coal Industry (Group) Co., Ltd. (陽泉煤業(集團)有限責任公司) 4 Genertec Universal Medical Group Company Limited COMPANY PROFILE Genertec Universal Medical Group Company Limited (通用環球醫療集團有限公司), along with its subsidiaries, is a conglomerate focusing on healthcare industry. China General Technology (Group) Holding Company Limited (中國通用技術(集團)控股有限責任公司), the controlling shareholder of the Company, is a backbone state-owned enterprise under direct administration of the PRC central government, and also a Fortune Global 500 enterprise. The Company has been fully engaged in the medical healthcare industry for decades and accumulated worldwide high-quality medical resources, including sustainable cooperative relations with hundreds of well-known medical experts, and strategic partnerships with famous domestic and overseas medical service institutions. Leveraging core competencies in modern managerial idea, professional talent team, quality medical resources, diversified financial strength as well as inclusive and enterprising corporate culture, we strive to build up a trustworthy healthcare conglomerate, with an integrated development system centered on medical services with a number of diversified businesses including medical finance and industry chain extension businesses. With the operation center located in Beijing, the Company has over 40 medical institutions distributed in several provinces including Shaanxi, Anhui, Hebei, Hunan, Sichuan and Liaoning, forming a medical service network centered on certain regions and radiating nationwide. In the future, we will firmly grasp the good opportunity of China’s medical healthcare industry, build a medical service system with comfortable environment, first-class service, perfect technology and high operation efficiency by using cutting-edge scientific and technological achievements, advanced operation methods, scarce expert resources and industry development insights, safeguard health and wellness through quality healthcare, and make contribution to the "Healthy China" plan. 2019 Annual Report 5 CEO’S STATEMENT CEO’S STATEMENT The end of 2019 has seen the outbreak of COVID-19, swiftly spreading across the globe. Faced with this global crisis, China has been striving hard with concerted efforts of the whole nation to fight the pandemic.