ANNUAL Report CONTENTS QINHUANGDAO PORT CO., LTD

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ANNUAL Report CONTENTS QINHUANGDAO PORT CO., LTD (a joint stock limited liability company incorporated in the People’s Republic of China) Stock Code : 3369 ANNUAL REPORT CONTENTS QINHUANGDAO PORT CO., LTD. ANNUAL REPORT 2018 Definitions and Glossary of Technical Terms 2 Consolidated Balance Sheet 75 Corporate Information 5 Consolidated Income Statement 77 Chairman’s Statement 7 Consolidated Statement of Changes in Equity 79 Financial Highlights 10 Consolidated Statement of Cash Flows 81 Shareholding Structure of the Group 11 Company Balance Sheet 83 Management Discussion and Analysis 12 Company Income Statement 85 Corporate Governance Report 25 Company Statement of Changes in Equity 86 Biographical Details of Directors, 41 Company Statement of Cash Flows 87 Supervisors and Senior Management Notes to Financial Statements 89 Report of the Board of Directors 48 Additional Materials Report of Supervisory Committee 66 1. Schedule of Extraordinary Profit and Loss 236 Auditors’ Report 70 2. Return on Net Assets and Earning per Share 236 Audited Financial Statements DEFINITIONS AND GLOSSARY OF TECHNICAL TERMS “A Share(s)” the RMB ordinary share(s) issued by the Company in China, which are subscribed for in RMB and listed on the SSE, with a nominal value of RMB1.00 each “AGM” or “Annual General Meeting” the annual general meeting or its adjourned meetings of the Company to be held at 10:00 am on Thursday, 20 June 2019 at Qinhuangdao Sea View Hotel, 25 Donggang Road, Haigang District, Qinhuangdao, Hebei Province, PRC “Articles of Association” the articles of association of the Company “Audit Committee” the audit committee of the Board “Berth” area for mooring of vessels on the shoreline. A berth means one designated place for a vessel to moor “Board of Directors” or “Board” the board of directors of the Company “Cangzhou Bohai Port” Cangzhou Bohai Stevedoring Co., Ltd.* (滄州渤海港務有限公司), a company incorporated in the PRC with limited liability on 31 October 2007, with 96.08% of its equity interest held by the Company as at the date of this report “Cangzhou Crude Oil Stevedoring Co.” Cangzhou Huanghua Port Crude Oil Stevedoring Co., Ltd.* (滄州黃驊港原油港務 有限公司), a company incorporated in the PRC with limited liability on 25 April 2014, with 65.00% of its equity interest held by the Company as at the date of this report “Cangzhou Mineral Port” Cangzhou Huanghuagang Mineral Port Co., Ltd.* (滄州黃驊港礦石港務有限公 司), a company incorporated in the PRC with limited liability on 10 April 2012, with 98.90% of its equity interest held by the Company as at the date of this report “Caofeidian Coal Port” Tangshan Caofeidian Coal Port Co., Ltd.* (唐山曹妃甸煤炭港務有限公司), a company incorporated in the PRC with limited liability on 29 October 2009 with 51.00% of its equity interest held by the Company as at the date of this report “Caofeidian Port” Caofeidian Port Zone in Tangshan Port, Tangshan City, Hebei Province “Company” Qinhuangdao Port Co., Ltd.* (秦皇島港股份有限公司), a joint stock limited liability company incorporated under the laws of the PRC on 31 March 2008 “Corporate Governance Code” the Corporate Governance Code set out in Appendix 14 to the Listing Rules “Director(s)” director(s) of the Company 2 QINHUANGDAO PORT CO., LTD. ANNUAL REPORT 2018 DEFINITIONS AND GLOSSARY OF TECHNICAL TERMS “Dry bulk” solid commodity cargo comprised of major dry bulk (coal, metal ore and grain) and other dry bulk commodities such as sugar, cement and fertilizer “Global Offering” the issuance of H Shares of the Company by way of Hong Kong public offering and international offering in 2013 “the Group” the Company and all of its subsidiaries (unless the context otherwise requires) “H Share(s)” overseas listed foreign invested ordinary share(s) in the ordinary share capital of the Company, with a nominal value of RMB1.00 each, which are subscribed for and traded in Hong Kong dollars and listed and traded on the Stock Exchange “HBIS” HBIS Group Co., Ltd.* (河鋼集團國際物流有限公司), a company incorporated in the PRC with limited liability “harbor” a port of haven where ships may anchor “HK$” Hong Kong dollars, the lawful currency of Hong Kong “Hong Kong” the Hong Kong Special Administrative Region of the PRC “HPG” Hebei Port Group Co., Ltd.* (河北港口集團有限公司), previously known as Qinhuangdao Port Group Co., Ltd.* (秦皇島港務集團有限公司), which directly holds 54.27% equity interest of the Company “Huanghua Port” Huanghua Port in Cangzhou City, Hebei Province “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange, as amended from time to time “Model Code” Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix 10 to the Listing Rules “PRC” or “China” the People’s Republic of China which, for the purpose of this report, excludes Hong Kong Special Administrative Region of the PRC, Macau Special Administrative Region of the PRC and Taiwan “Prospectus” the prospectus of the Company dated 29 November 2013 in connection with the Global Offering “Qinhuangdao Port” Qinhuangdao Port in Qinhuangdao City, Hebei Province “RMB” or “Renminbi” Renminbi, the lawful currency of the PRC QINHUANGDAO PORT CO., LTD. ANNUAL REPORT 2018 3 DEFINITIONS AND GLOSSARY OF TECHNICAL TERMS “SFO” the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong), as amended from time to time “Share(s)” A Share(s) and/or H Share(s) (as the case may be) “Shareholder(s)” holder(s) of our Shares “SSE” the Shanghai Stock Exchange “Stock Exchange” The Stock Exchange of Hong Kong Limited “Terminal” a major construction of a harbor which is designated for mooring vessels, loading and unloading cargoes and boarding travelers “TEU” or “container” a box made of aluminum, steel or fiberglass and used to transport by ship, rail or barge. The standardized dimension (i.e. one TEU) is twenty feet in length, eight feet and six inches in height and eight feet in width “Throughput” a measure of the volume of cargo handled by a port. Where cargoes are transshipped, each unloading and loading process is measured separately as part of throughput “the Year” or “the Reporting Period” the year ended 31 December 2018 4 QINHUANGDAO PORT CO., LTD. ANNUAL REPORT 2018 CORPORATE INFORMATION Official Name of the Company Board Committees 秦皇島港股份有限公司 (1) Audit Committee Ms. ZANG Xiuqing (臧秀清) (Chairwoman) English Name of the Company Ms. XIAO Xiang (肖湘) QINHUANGDAO PORT CO., LTD.* Mr. XIAO Zuhe (肖祖核) Legal Representative (2) Remuneration and Appraisal Committee Mr. CAO Ziyu (曹子玉) Mr. HOU Shujun (侯書軍) (Chairman) Board of Directors Mr. YANG Wensheng (楊文勝) Ms. ZANG Xiuqing (臧秀清) (1) Executive Directors Mr. CAO Ziyu (曹子玉) (3) Nomination Committee Mr. YANG Wensheng (楊文勝) Mr. CHEN Ruihua (陳瑞華) (Chairman) Mr. WANG Lubiao (王錄彪) Mr. LI Jianping (李建平) (resigned as an Executive Director of the Ms. ZANG Xiuqing (臧秀清) Company on 27 March 2019) Mr. MA Xiping (馬喜平) (4) Strategy Committee (2) Non-executive Directors Mr. CAO Ziyu (曹子玉) (Chairman) Mr. YANG Wensheng (楊文勝) Mr. LIU Guanghai (劉廣海) Ms. XIAO Xiang (肖湘) Mr. LI Jianping (李建平) Mr. HOU Shujun (侯書軍) Ms. XIAO Xiang (肖湘) Mr. CHEN Ruihua (陳瑞華) (3) Independent Non-executive Supervisory Committee Directors (1) Supervisors Ms. ZANG Xiuqing (臧秀清) Mr. HOU Shujun (侯書軍) Mr. MENG Bo (孟博) Mr. CHEN Ruihua (陳瑞華) Mr. BU Zhouqing (卜周慶) Mr. XIAO Zuhe (肖祖核) Ms. BIAN Yingzi (卞英姿) (2) Employee Representative Supervisors Mr. CAO Dong (曹棟) Ms. CHEN Linyan (陳林燕) * For identification purpose only QINHUANGDAO PORT CO., LTD. ANNUAL REPORT 2018 5 CORPORATE INFORMATION Company Secretary Principal Place of Business Mr. ZHANG Nan (張楠) 35 Haibin Road Qinhuangdao Hebei Province, the PRC Authorized Representatives Principal Place of Business in Hong Mr. MA Xiping (馬喜平) Mr. ZHANG Nan (張楠) Kong Room C, 26/F, Tower A, Billion Centre, Auditors 1 Wang Kwong Road, Kowloon Bay, Hong Kong Ernst & Young Hua Ming LLP Level 16, Ernst & Young Tower Oriental Plaza, No 1 East Chang An Avenue Dongcheng District, Principal Bankers Beijing, the PRC Industrial and Commercial Bank of China Limited (Qinhuangdao Haibin Road Branch) Legal Advisors as to Hong Kong Law Bank of Communications Co., Limited (Cangzhou Branch) Herbert Smith Freehills China Minsheng Banking Corp., Limited 23/F, Gloucester Tower, 15 Queen’s Road Central (Cangzhou Branch) Central, Hong Kong Bank of China Limited (Tangshan Branch) Registered Address H Share Registrar in Hong Kong 35 Haibin Road, Haigang District, Qinhuangdao Computershare Hong Kong Investor Services Limited Hebei Province, the PRC Shops 1712-1716 Headquarters 17th Floor, Hopewell Centre 183 Queen’s Road East 35 Haibin Road, Haigang District, Qinhuangdao Wanchai, Hong Kong Hebei Province, the PRC Company Website www.portqhd.com Stock Code 03369 (H share) 601326 (A share) 6 QINHUANGDAO PORT CO., LTD. ANNUAL REPORT 2018 CHAIRMAN’S STATEMENT Chairman’s STATEMENT Dear Shareholders, On behalf of the Board of Directors, I am pleased to present to you the annual report of the Group for the year ended 31 December 2018. Analysis of the Macroeconomic Condition During the year, the world economic growth slowed down. Despite the continuously rising economic growth rate of a few economies such as the United States, the economic growth rate of most other economies has declined. In addition, there are some noticeable features, such as the slowdown in international trade growth, the sluggish international direct investment activity, the continuous increase of global debt levels and the turmoil in financial markets. In the face of the intricate international and domestic environment, the Chinese economy has maintained a generally stable growth, and has successfully completed the main expected targets for economic and social development with the annual GDP growth reaching 6.6%. Performance of Major Business and Dividends During the year, facing the unfavorable environment in which international trade disputes was intensifying and pressure from domestic environmental protection policies was increasing and steelworks in the hinterland limited production, the Group expanded markets externally, and reduced costs and increased benefits internally, achieving steady growth in throughput.
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