美國
證券交易委員會
華盛頓特區 20549
表格
根據規則13a-16或15d-16的外資私人發行人報告
證券交易法第1934條
2024年12月
委託文件號碼
(註冊者名稱的英文翻譯)
（主要行政辦公室地址）
請勾選註冊人是否提交或將提交20-F表格或40-F表格的年度報告。20-F表格☒40-F表格☐
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本6-K表格的報告特此納入 中國天然資源公司（「公司」）的F-3表格註冊聲明（文件編號：333-268454）， 以及相關的招股說明書，作爲此註冊聲明和招股說明書可能不時修訂或補充，並在本報告提供之日起成爲其中的一部分， 在此之前未被隨後提交或提供的文件或報告取代。
未經審計的運營結果
在此代表公司提供以下內容：
(a) 未經審計的基本報表:
| - | 截至六個月的合併利潤或損失彙總表（未經審計） |
| - | 截至2024年和2023年6月30日的六個月未經審計的合併綜合收益表 |
| - | 截至2024年6月30日（未經審計）及2023年12月31日的合併財務狀況表 |
| - | 截至2024年6月30日和2023年6月30日的合併權益變動簡表（未經審計） |
| - | 截至2024年和2023年6月30日的未經審計合併現金流量表（六個月） |
| - | 未經審計的簡明合併財務報表註釋 |
(b) 管理層討論 和財務控制項及運營結果分析
威廉的買賣協議修正協議 礦產
開啓 2024 年 12 月 31 日，公司簽訂了修正協議（「修正協議」） II“) 進一步修改飛尚集團與冠太平洋（中國）有限公司之間於2023年2月27日簽訂的買賣協議 （統稱 「賣方」），以及賣方各自的受益所有人李飛烈先生和姚宇光先生（「SPA」） 與其當事方簽訂，該協議最初由2023年12月22日的修正協議（「修正協議」）修訂。 簽訂SPA最初是爲了收購Greatfame Investments Limited的100％股權，該公司擁有 威廉姆斯礦業（私人）有限公司（「威廉姆斯礦業」）（「收購」）100％的股權。作爲賣家 仍在滿足根據SPA完成收購之前的條件的過程中，包括但是 不僅限於獲得必要的政府批准，雙方首先簽訂了修正協議，以延長該期限 2023 年 12 月 31 日至 2024 年 12 月 31 日期間完成收購的截止日期（「長止日期」），並簽訂了 2024 年 12 月 31 日的《第二修正協議》，將最終截止日期從 2024 年 12 月 31 日進一步延長至 2025 年 12 月 31 日。
本協議的修訂協議II的描述通過引用2024年12月31日公司、賣方及賣方各自的受益所有人之間的銷售和購買協議的修訂協議II而全面限定，該協議作爲本表格6-k的附件99.1提交。
新聞稿
在2024年12月31日，公司發佈了一份新聞稿，包含了本當前報告中的部分信息。隨附作爲附件15.1的新聞稿不應視爲根據1934年證券交易法第18條的規定而「提交」，並且不被納入公司在此日期之前或之後所作的任何文件中，無論該文件中有無任何一般合併語言。
展覽索引
| 15.1 | 新聞稿，日期爲2024年12月31日。 | |
| 99.1 | 修正協議II，日期爲2024年12月31日，涉及2023年2月27日由公司、飛尚集團和太平洋（中國）有限公司、李飛雷和姚宇光簽署的買賣協議。 | |
| 101.INS | 內聯XBRL實例文檔 - 此實例文檔未出現在交互數據文件中，因爲其XBRL標籤嵌入在內聯XBRL文檔中。 | |
| 101.SCH | 內部XBRL分類擴展架構文檔。 | |
| 101.CAL | 行內XBRL分類法擴展計算鏈接庫文檔。 | |
| 101.DEF | 行內XBRL分類法擴展定義鏈接庫文檔。 | |
| 101.LAB | 內聯XBRL分類擴展標籤鏈接庫文檔。 | |
| 101.PRE | 行內XBRL分類法擴展展示鏈接庫文檔。 | |
| 104 | 封面頁交互數據文件（嵌入在Inline XBRL文檔中） |
簽名
根據1934年證券交易法的要求， 經修訂，註冊人已由下方簽名者適當地代表其簽署本報告，且已正式授權。
| 中國天然資源有限公司 | |||
| 日期：2024年12月31日 | 由： | /s/ 黃華安 | |
| 黃華安 | |||
| 董事長兼首席執行官 | |||
中國天然資源有限公司
合併基本報表目錄
| 未經審計的臨時基本報表 | 頁碼 |
| 截至2024年和2023年6月30日的六個月未經審計的綜合利潤表 | F-2 |
| 截至2024年和2023年6月30日的六個月未經審計的合併綜合收益表 | F-3 |
| 截至2024年6月30日（未經審計）及2023年12月31日的合併財務狀況表 | F-4 – F-5 |
| 截至2024年6月30日和2023年6月30日的合併權益變動簡表（未經審計） | F-6 |
| 截至2024年和2023年6月30日的未經審計合併現金流量表（六個月） | F-7 |
| 未經審計的簡明合併財務報表註釋 | F-8 – F-29 |
| F-1 |
中國天然資源公司及其子公司
簡明合併損益表 （未經審計）
截至2024年6月30日和2023年的六個月
(金額單位爲千，除每股數據外)
| 截至6月30日的六個月 | ||||||||||||||||
| 2023 | 2024 | 2024 | ||||||||||||||
| 人民幣 | 人民幣 | 美元 | ||||||||||||||
| 票據 | (未經審計) | (未經審計) | (未經審計) | |||||||||||||
| 持續經營 | ||||||||||||||||
| 行政費用 | ( | ) | ( | ) | ( | ) | ||||||||||
| 其他收入 | ||||||||||||||||
| 金融工具的公允價值（損失）/收益 | 5 | ( | ) | |||||||||||||
| 財務費用 | ( | ) | ( | ) | ( | ) | ||||||||||
| 財務收入 | ||||||||||||||||
| 所得稅前損失 | 5 | ( | ) | ( | ) | ( | ) | |||||||||
| 所得稅費用 | 6 | |||||||||||||||
| 來自持續經營的期間虧損 | ( | ) | ( | ) | ( | ) | ||||||||||
| 已終止的業務 | ||||||||||||||||
| 來自終止經營的期間虧損，稅後淨額 | ( | ) | ||||||||||||||
| 期間虧損 | ( | ) | ( | ) | ( | ) | ||||||||||
| 歸屬於： | ||||||||||||||||
| 公司股東 | ||||||||||||||||
| 從持續運營中 | ( | ) | ( | ) | ( | ) | ||||||||||
| 從終止運營中 | ( | ) | ||||||||||||||
| 非控股權益 | ||||||||||||||||
| 從持續運營中 | ||||||||||||||||
| 從終止運營中 | ||||||||||||||||
| 期間虧損 | ( | ) | ( | ) | ( | ) | ||||||||||
| 歸屬於公司股東的每股虧損： | ||||||||||||||||
| 基本和稀釋 | ||||||||||||||||
| - 從持續經營中產生的損失 | 7 | ) | ) | |||||||||||||
| - 從終止經營中產生的損失 | 7 | ) | ||||||||||||||
| - 每股虧損 | 7 | ) | ) | |||||||||||||
| F-2 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2023
(Amounts in thousands)
| Six Months Ended June 30, | ||||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| LOSS FOR THE PERIOD | ( | ) | ( | ) | ( | ) | ||||||
| Other comprehensive (loss)/income that will be reclassified to profit or loss in subsequent periods: | ||||||||||||
| Foreign currency translation adjustments of the subsidiaries | ( | ) | ||||||||||
| Other comprehensive income that will not be reclassified to profit or loss in subsequent periods: | ||||||||||||
| Foreign currency translation adjustments of the Company | ||||||||||||
| Total other comprehensive (loss)/ income for the period, net of tax | ( | ) | ||||||||||
| TOTAL COMPREHENSIVE (LOSS)/ INCOME FOR THE PERIOD | ( | ) | ||||||||||
| Attributable to: | ||||||||||||
| Owners of the Company | ||||||||||||
| From continuing operations | ( | ) | ||||||||||
| From discontinued operations | ( | ) | ||||||||||
| Non-controlling interests | ||||||||||||
| From continuing operations | ||||||||||||
| From discontinued operations | ||||||||||||
| TOTAL COMPREHENSIVE LOSS FOR THE YEAR | ( | ) | ||||||||||
| F-3 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS OF JUNE 30, 2024 (UNAUDITED) AND DECEMBER 31, 2023
(Amounts in thousands)
| December 31, | June 30, | |||||||||||||||
| 2023 | 2024 | 2024 | ||||||||||||||
| CNY | CNY | US$ | ||||||||||||||
| Notes | (Audited) | (Unaudited) | (Unaudited) | |||||||||||||
| ASSETS | ||||||||||||||||
| NON-CURRENT ASSETS | ||||||||||||||||
| Property, plant and equipment | 8 | |||||||||||||||
| Right-of-use assets | ||||||||||||||||
| Other non-current assets | 9 | |||||||||||||||
| TOTAL NON-CURRENT ASSETS | ||||||||||||||||
| CURRENT ASSETS | ||||||||||||||||
| Prepayments | 10 | |||||||||||||||
| Other receivables | 11 | |||||||||||||||
| Cash and cash equivalents | 12 | |||||||||||||||
| TOTAL CURRENT ASSETS | ||||||||||||||||
| TOTAL ASSETS | ||||||||||||||||
| F-4 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (CONTINUED)
AS OF JUNE 30, 2024 (UNAUDITED) AND DECEMBER 31, 2023
(Amounts in thousands)
| December 31, | June 30, | |||||||||||||||
| 2023 | 2024 | 2024 | ||||||||||||||
| CNY | CNY | US$ | ||||||||||||||
| Notes | (Audited) | (Unaudited) | (Unaudited) | |||||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||||
| CURRENT LIABILITIES | ||||||||||||||||
| Trade payables | ||||||||||||||||
| Other payables and accruals | 13 | |||||||||||||||
| Derivative financial liabilities | 14 | |||||||||||||||
| Lease liabilities | ||||||||||||||||
| Due to related companies | 18 | |||||||||||||||
| Due to the Shareholder | 18 | |||||||||||||||
| TOTAL CURRENT LIABILITIES | ||||||||||||||||
| TOTAL LIABILITIES | ||||||||||||||||
| EQUITY | ||||||||||||||||
| Issued capital | 16 | |||||||||||||||
| Other capital reserves | 16 | |||||||||||||||
| Accumulated losses | ( | ) | ( | ) | ( | ) | ||||||||||
| Other comprehensive losses | ( | ) | ( | ) | ( | ) | ||||||||||
| EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY | ||||||||||||||||
| NON-CONTROLLING INTERESTS | ||||||||||||||||
| TOTAL EQUITY | ||||||||||||||||
| TOTAL LIABILITIES AND EQUITY | ||||||||||||||||
| F-5 |
CHINA NATURAL RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2023
(Amounts in thousands)
Attributable to Owners of the Company
| Issued capital | Other capital reserves | Accumulated losses | Other comprehensive (loss)/income | Total | Non-controlling interests | Total Equity | ||||||||||||||||||||||
| CNY | CNY | CNY | CNY | CNY | CNY | CNY | ||||||||||||||||||||||
| Balance as of January 1, 2023 | ( | ) | ( | ) | ||||||||||||||||||||||||
| (Loss)/profit for the period | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| Foreign currency translation adjustments | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| Total comprehensive (loss)/income | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||
| Balance as of June 30, 2023 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance as of January 1, 2024 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Loss for the period | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||
| Foreign currency translation adjustments | ||||||||||||||||||||||||||||
| Total comprehensive (loss)/income | ( | ) | ||||||||||||||||||||||||||
| Issue of shares | ||||||||||||||||||||||||||||
| Share-based payments (Note 17) | ||||||||||||||||||||||||||||
| Balance as of June 30, 2024 | ( | ) | ( | ) | ||||||||||||||||||||||||
| Balance as of June 30, 2024 (US$) | ( | ) | ( | ) | ||||||||||||||||||||||||
| F-6 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2023
(Amounts in thousands)
| Six Months Ended June 30, | ||||||||||||||||
| 2023 | 2024 | 2024 | ||||||||||||||
| CNY | CNY | US$ | ||||||||||||||
| Note | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| OPERATING ACTIVITIES | ( | ) | ( | ) | ||||||||||||
| INVESTING ACTIVITIES | ||||||||||||||||
| Purchase of property, plant and equipment | ( | ) | ( | ) | ( | ) | ||||||||||
| Expenditures on mine development | ( | ) | ||||||||||||||
| Net cash flows used in investing activities | ( | ) | ( | ) | ( | ) | ||||||||||
| FINANCING ACTIVITIES | ||||||||||||||||
| Proceeds from issuance of shares | ||||||||||||||||
| Repayments of bank loans | ( | ) | ||||||||||||||
| Advances from related companies | ||||||||||||||||
| Repayments to the Shareholder | ( | ) | ( | ) | ||||||||||||
| Payment of principal portion of lease liabilities | ( | ) | ||||||||||||||
| Payment of interest expenses of lease liabilities | ( | ) | ||||||||||||||
| Interest paid | ( | ) | ||||||||||||||
| Net cash flows (used in)/from financing activities | ( | ) | ||||||||||||||
| NET INCREASE IN CASH AND CASH EQUIVALENTS | ||||||||||||||||
| NET FOREIGN EXCHANGE DIFFERENCE | ||||||||||||||||
| CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | ||||||||||||||||
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | 12 | |||||||||||||||
| F-7 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Amounts in thousands, except share and per share data)
| 1. | ORGANIZATION AND PRINCIPAL ACTIVITIES |
China Natural Resources, Inc. (“CHNR” or the “Company”) is a British Virgin Islands (“BVI”) holding company incorporated in 1993. The address of the principal executive office is Room 2205, 22/F, West Tower, Shun Tak Centre, 168-200 Connaught Road Central, Sheung Wan, Hong Kong. The Company’s principal activity is investment holding. The Company’s subsidiaries (collectively with CHNR, the “Group”) are primarily involved in the exploration and mining and wastewater treatment businesses in the People’s Republic of China (“PRC”).
CHNR’s principal shareholder is Feishang Group Limited (“Feishang Group” or the “Shareholder”), a BVI corporation. Mr. Li Feilie is the controlling shareholder of Feishang Group. In the opinion of the directors of the Company (the “Directors”), the ultimate parent of CHNR is Laitan Investment Limited, a BVI corporation.
| 2.1 | BASIS OF PRESENTATION |
The interim condensed consolidated financial statements for the six months ended June 30, 2024 have been prepared in accordance with International Accounting Standard (“IAS”) 34 Interim Financial Reporting.
The Group has prepared the financial statements on the basis that it will continue to operate as a going concern.
As of June 30, 2024, the Group had net current
liabilities of CNY
The interim condensed consolidated financial statements do not include all the information and footnotes required by International Financial Reporting Standards (“IFRS”) for complete financial statements, and should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Group’s annual report on Form 20-F for the year ended December 31, 2023 (the “2023 Annual Report”).
The condensed consolidated financial statements include the accounts of CHNR and those subsidiaries in which CHNR has direct or indirect controlling interests. The Company’s subsidiaries as of June 30, 2024 are as described in the 2023 Annual Report.
For the convenience of readers, amounts in
Renminbi, the Chinese currency (“CNY”), have been translated into United States dollars (“US$”) at the applicable
rate of
| F-8 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 2.2 | CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES |
The accounting policies adopted in the preparation of the interim condensed consolidated financial information are consistent with those applied in the preparation of the Group’s annual consolidated financial statements for the year ended December 31, 2023, except for the adoption of the following new and revised IFRS for the first time for the current period’s financial information.
| Amendments to IFRS 16 | Lease Liability in a Sale and Leaseback |
| Amendments to IAS 1 | Classification of Liabilities as Current or Non-current (the “2020 Amendments”) |
| Amendments to IAS 1 | Non-current Liabilities with Covenants (the “2022 Amendments”) |
| Amendments to IAS 7 and IFRS 7 | Supplier Finance Arrangements |
The nature and impact of the revised IFRSs that are applicable to the Group are described below:
| (a) | Amendments to IFRS 16 specify the requirements that a seller-lessee uses in measuring the lease liability arising in a sale and leaseback transaction to ensure the seller-lessee does not recognise any amount of the gain or loss that relates to the right of use it retains. Since the Group has no sale and leaseback transactions with variable lease payments that do not depend on an index or a rate occurring from the date of initial application of IFRS 16, the amendments did not have any impact on the financial position or performance of the Group. |
| (b) | The 2020 Amendments clarify the requirements for classifying liabilities as current or non-current, including what is meant by a right to defer settlement and that a right to defer must exist at the end of the reporting period. Classification of a liability is unaffected by the likelihood that the entity will exercise its right to defer settlement. The amendments also clarify that a liability can be settled in its own equity instruments, and that only if a conversion option in a convertible liability is itself accounted for as an equity instrument would the terms of a liability not impact its classification. The 2022 Amendments further clarify that, among covenants of a liability arising from a loan arrangement, only those with which an entity must comply on or before the reporting date affect the classification of that liability as current or non-current. Additional disclosures are required for non-current liabilities that are subject to the entity complying with future covenants within 12 months after the reporting period. |
The Group has reassessed the terms and conditions of its liabilities as at 1 January 2023 and 2024 and concluded that the classification of its liabilities as current or non-current remained unchanged upon initial application of the amendments. Accordingly, the amendments did not have any impact on the financial position or performance of the Group.
| (c) | Amendments to IAS 7 and IFRS 7 clarify the characteristics of supplier finance arrangements and require additional disclosure of such arrangements. The disclosure requirements in the amendments are intended to assist users of financial statements in understanding the effects of supplier finance arrangements on an entity’s liabilities, cash flows and exposure to liquidity risk. The disclosure of relevant information for supplier finance arrangements is not required for any interim reporting period during the first annual reporting period in which an entity applies the amendments. As the Group does not have supplier finance arrangements, the amendments did not have any impact on the interim condensed consolidated financial statements. |
| F-9 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 3. | DISCONTINUED OPERATIONS |
On July 28, 2023, the Company’s board of directors had approved the Sale and Purchase Agreement (“SPA") with Feishang Group. Pursuant to the SPA, the Company agreed to sell 100% equity interest of Precise Space-Time Technology Limited ("PSTT") to Feishang Group, together with PSTT's outstanding payable owed to the Company, for consideration of approximately CNY95,761 comprising: (i) CNY-34,197, the fair value of 100% equity interest of PSTT as determined by the independent valuation report dated July 28, 2023. (ii) CNY129,958, the book value of PSTT's outstanding payable owed to the Company (referred as Disposal of PSTT). PSTT operated the wastewater treatment segment. After the disposal, the Company will not operate any wastewater treatment business and will continue operating its exploration and mining business.
The Disposal of PSTT was accounted for as an equity transaction of entities under common control.
The results of PSTT for the period ended June 30, 2023 are presented below.
| Six Months Ended June 30, 2023 | ||||
| CNY | ||||
| (Unaudited) | ||||
| Revenue | ||||
| Cost of sales | ( | ) | ||
| GROSS PROFIT | ||||
| Selling and distribution expenses | ( | ) | ||
| Administrative expenses | ( | ) | ||
| Other income | ||||
| Impairment losses on financial assets | ( | ) | ||
| Finance costs | ( | ) | ||
| Finance income | ||||
| LOSS BEFORE INCOME TAX | ( | ) | ||
| Income tax expense | ( | ) | ||
| LOSS FOR THE PERIOD FROM THE DISCONTINUED OPERATIONS | ( | ) | ||
| ATTRIBUTABLE TO: | ||||
| Owners of the Company | ( | ) | ||
| Non-controlling interests | ||||
| F-10 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
3. DISCONTINUED OPERATIONS (CONTINUED)
The net cash flows incurred by PSTT are as follows:
| Six Months Ended June 30, 2023 | ||||
| CNY | ||||
| Operating activities | ||||
| Investing activities | ( | ) | ||
| Financing activities | ( | ) | ||
| Net foreign exchange difference | ||||
| Net increase in cash and cash equivalents | ||||
| Loss per share | ||||
| – Basic, from the discontinued operations | ( | ) | ||
| – Diluted, from the discontinued operations | ( | ) | ||
The calculations of basic and diluted earnings per share from discontinued operations are based on:
| Six Months Ended June 30, 2023 | ||||
| CNY | ||||
| Loss for the period attributable to owners of the Company from discontinued operations | ( | ) | ||
| Weighted average number of ordinary shares in issue during the period used in the basic and diluted earnings per share calculation (Note 7) | ||||
| F-11 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 4. | SEGMENT INFORMATION |
Operating segments are identified on the basis of internal reports about components of the Group that are regularly reviewed by the Group’s management and the Company’s Board of Directors for the purpose of resource allocation and performance assessment.
Management assesses the performance of operating segments based on profit or loss before income tax in related periods. The manner of assessment is consistent with that applied in these financial statements.
Deferred tax assets, income tax payable and deferred tax liabilities are excluded from segment assets and segment liabilities. The Group had neither sale of products nor provisions of services between the operating segments.
As of December 31, 2023 and June 30, 2024, after the disposal of PSTT in July 2023, the Group only operates in one operating segment: exploration and mining, which consists of the exploration for lead, silver, lithium and other metals. The segment results for the six months ended June 30, 2023 were retroactively restated to exclude discontinued operations (Note 3). Segment performance is evaluated based on reportable segment profit / (loss), which is a measure of adjusted profit / (loss) before tax from continuing operations. The segment analysis below is provided for the Group's continuing operations and does not include any amount from a discontinued operation, namely the wastewater treatment (see Note 3 for information on discontinued operations).
For the six months ended June 30, 2023, the segment results were as follows:
| Exploration and mining | Corporate activities | Total | ||||||||||
| CNY | CNY | CNY | ||||||||||
| Other items | ||||||||||||
| Depreciation of property, plant and equipment | ( | ) | ( | ) | ( | ) | ||||||
| Depreciation of right of use assets | ( | ) | ( | ) | ||||||||
| Other income | ||||||||||||
| Fair value loss on financial instruments | ( | ) | ( | ) | ||||||||
| Finance costs | ( | ) | ( | ) | ( | ) | ||||||
| Finance income | ||||||||||||
| Loss for the period from continuing operations | ( | ) | ( | ) | ( | ) | ||||||
For the six months ended June 30, 2024, the segment results were as follows:
| Exploration and mining | Corporate activities | Total | ||||||||||
| CNY | CNY | CNY | ||||||||||
| Other items | ||||||||||||
| Depreciation of property, plant and equipment | ( | ) | ( | ) | ||||||||
| Depreciation of right of use assets | ( | ) | ( | ) | ||||||||
| Fair value gain on financial instruments | ||||||||||||
| Finance costs | ( | ) | ( | ) | ( | ) | ||||||
| Finance income | ||||||||||||
| Loss for the period from continuing operations | ( | ) | ( | ) | ||||||||
| F-12 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
4. SEGMENT INFORMATION (CONTINUED)
For the six months ended June 30, 2024, the segment results were as follows: (continued)
| Exploration and mining | Corporate activities | Total | ||||||||||
| US$ | US$ | US$ | ||||||||||
| Other items | ||||||||||||
| Depreciation of property, plant and equipment | ||||||||||||
| Depreciation of right of use assets | ( | ) | ( | ) | ||||||||
| Fair value loss on financial instruments | ||||||||||||
| Finance costs | ( | ) | ( | ) | ||||||||
| Finance income | ||||||||||||
| Loss for the period from continuing operations | ( | ) | ( | ) | ||||||||
The reconciliation of segment assets to total assets is as follows:
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| Segment assets: | ||||||||||||
| Exploration and mining | ||||||||||||
| Corporate activities | ||||||||||||
| Total assets | ||||||||||||
The reconciliation of segment liabilities to total liabilities is as follows:
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| Segment liabilities: | ||||||||||||
| Exploration and mining | ||||||||||||
| Corporate activities | ||||||||||||
| Total liabilities | ||||||||||||
The reconciliation from loss for the period from continuing operations to net loss is as follows:
| June 30, | ||||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| Loss for the period from continuing operations | ( | ) | ( | ) | ( | ) | ||||||
| Loss for the period from discontinued operations | ( | ) | ||||||||||
| Net loss (including non-controlling interests) | ( | ) | ( | ) | ( | ) | ||||||
| F-13 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 5. | LOSS BEFORE INCOME TAX |
The Group’s loss before tax from continuing operations is arrived at after (crediting)/charging:
| Six months ended June 30, | ||||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| Crediting: | ||||||||||||
| Finance income | ( | ) | ( | ) | ( | ) | ||||||
| Other income | ( | ) | ||||||||||
| Depreciation: | ||||||||||||
| - Property, plant and equipment | ||||||||||||
| - Right-of-use assets | ||||||||||||
| Expense relating to short-term leases | ||||||||||||
| Fair value loss/(gain) on financial instruments: | ||||||||||||
| - Derivative financial liabilities | ( | ) | ( | ) | ||||||||
| Finance costs | ||||||||||||
The Group’s loss before tax from discontinuing operations is arrived at after (crediting)/charging:
| Six months ended June 30, | ||||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| Crediting: | ||||||||||||
| Finance income (Note 3) | ( | ) | ||||||||||
| Other income | ( | ) | ||||||||||
| Charging: | ||||||||||||
| Cost of sales: | ||||||||||||
| - Construction service | ||||||||||||
| - Operation and maintenance services | ||||||||||||
| - Operation services related to service concession arrangement | ||||||||||||
| Total | ||||||||||||
| Depreciation: | ||||||||||||
| - Property, plant and equipment | ||||||||||||
| - Right-of-use assets | ||||||||||||
| Amortization of intangible assets | ||||||||||||
| Expense relating to short-term leases | ||||||||||||
| Impairment losses on financial assets: | ||||||||||||
| - Trade receivables | ||||||||||||
| - Contract assets | ||||||||||||
| - Other receivables | ||||||||||||
| Finance costs (Note 3) | ||||||||||||
| F-14 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 6. | INCOME TAX EXPENSE |
The Company is incorporated in the BVI and conducts its primary business operations through its subsidiaries in mainland China. It also has intermediate holding companies in the BVI and Hong Kong. Under the current laws of the BVI, the Company and its subsidiaries incorporated in the BVI are not subject to tax on income or capital gains. The Hong Kong Profits Tax rate is 16.50%. The Company’s Hong Kong subsidiaries have both Hong Kong–sourced and non-Hong Kong–sourced income. The latter is not subject to Hong Kong Profits Tax and the related expenses are non-tax-deductible. For the Hong Kong–sourced income, no provision for Hong Kong Profits Tax was made as such operations sustained tax losses during the period ended June 30, 2023 and 2024. Furthermore, there are no withholding taxes in Hong Kong on the remittance of dividends.
China
Under the Law of the PRC on corporate income tax and the Implementation Regulation of the Corporate Income Tax Law (collectively, the “CIT Law”), the Company’s PRC subsidiaries are generally subject to PRC corporate income tax at the statutory rate of 25% on their respective estimated assessable profits for the six months ended June 30, 2023 and 2024.
Under the prevailing CIT Law and its relevant regulations, any dividends paid by the Company’s mainland China subsidiaries from their earnings derived after January 1, 2008 to the Company’s Hong Kong subsidiaries are subject to PRC dividend withholding tax of 5% or 10%, depending on the applicability of the Sino-Hong Kong tax treaty.
The current and deferred components of income tax expense are as follows:
| Six months ended June 30, | ||||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| Current income tax expense | ||||||||||||
| Deferred income tax benefit | ||||||||||||
| Total tax credit for the period from continuing operations | ||||||||||||
| Total tax charge for the period from a discontinued operation | ||||||||||||
| Total | ||||||||||||
| F-15 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 7. | LOSS PER SHARE |
Basic loss per share is calculated by dividing the loss for the period attributable to ordinary equity holders of the Company by the weighted average number of common shares outstanding during the period.
Diluted loss per share is calculated by dividing the loss attributable to ordinary equity holders of the Company by the weighted average number of common shares outstanding during the period plus the weighted average number of common shares that would be issued on conversion of all outstanding dilutive securities into common shares.
Basic and diluted net loss per share for the six months ended June 30, 2023 and 2024 are as follows:
| Six months ended June 30, | ||||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| Loss for the period attributable to owners of the Company | ||||||||||||
| From continuing operations | ( | ) | ( | ) | ( | ) | ||||||
| From discontinued operations | ( | ) | ||||||||||
Weighted average number of ordinary shares for basic and diluted loss per share* | ||||||||||||
| Loss per share: | ||||||||||||
| Basic and diluted* | ||||||||||||
| For loss from continuing operations | ) | ) | ||||||||||
| For loss from discontinued operations | ) | |||||||||||
| Loss per share | ) | ) | ||||||||||
For the period ended June 30, 2023 and 2024, the effects of the outstanding warrants and share options were anti-dilutive and excluded from the computation of diluted loss per share. Accordingly, the diluted loss per share amounts are the same as the basic loss per share amounts for the periods presented.
| 8. | PROPERTY, PLANT AND EQUIPMENT |
During the six months ended 30 June 2024, the Group acquired
assets at a cost of CNY
| F-16 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 9. | OTHER NON-CURRENT ASSETS |
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Zimbabwe lithium deposits (i) | ||||||||||||
| Others | ||||||||||||
| Total | ||||||||||||
(i) Please refer to Note 18 (b) for more details.
| 10. | PREPAYMENTS |
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Prepayment to suppliers | ||||||||||||
| Deferred expenses | ||||||||||||
| Total | ||||||||||||
| 11. | OTHER RECEIVABLES |
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Financial assets: | ||||||||||||
| Deposits | ||||||||||||
| Financials asset | ||||||||||||
| Staff advance | ||||||||||||
| Others | ||||||||||||
| Total amount | ||||||||||||
| Total | ||||||||||||
| F-17 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 12. | CASH AND CASH EQUIVALENTS |
Cash and cash equivalents are set out below as of December 31, 2023 and June 30, 2024:
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Cash and cash equivalents | ||||||||||||
| - Cash on hand | ||||||||||||
| - Cash at bank | | |||||||||||
| Total | ||||||||||||
The carrying amounts of the Group’s cash and cash equivalents are denominated in the following currencies:
| December 31, | June 30, | ||||||||||||
| 2023 | 2024 | 2024 | |||||||||||
| CNY | CNY | US$ | |||||||||||
| (Audited) | (Unaudited) | (Unaudited) | |||||||||||
| CNY | |||||||||||||
| US$ | |||||||||||||
| HK$ | |||||||||||||
| Total | |||||||||||||
Cash at banks earns interest at floating rates based on daily bank deposit rates. The bank balances and time deposits are deposited with creditworthy banks with no recent history of default.
| 13. | OTHER PAYABLES AND ACCRUALS |
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Financial liabilities | ||||||||||||
| Accrued expenses | ||||||||||||
| Deposits from customers | ||||||||||||
| Other payables (financial liabilities) | ||||||||||||
| Taxes other than income tax payable (a) | ||||||||||||
| Accrued payroll | ||||||||||||
| Transaction deposit of mining right acquisition (Note18 (b)) | ||||||||||||
| Others | ||||||||||||
| Others payables (non-financial liabilities) | ||||||||||||
| Total | ||||||||||||
| (a) |
| F-18 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 14. | FINANCIAL INSTRUMENTS |
| (a) | Financial assets |
Set out below is an overview of financial assets, other than cash and short-term deposits, held by the Group as of December 31, 2023 and June 30, 2024:
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Debt instruments at amortized cost: | ||||||||||||
| Financial assets included in other Receivables | ||||||||||||
| Total | ||||||||||||
| Total Current | ||||||||||||
| Total Non-current | ||||||||||||
| (b) | Financial liabilities |
Set out below, is an overview of financial liabilities of the Group as of December 31, 2023 and June 30, 2024:
| December 31, | June 30 | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Derivatives not designated as hedging instruments: | ||||||||||||
| Derivative financial liabilities (Note 16) | ||||||||||||
| Financial liabilities at amortized cost: | ||||||||||||
| Trade payables | ||||||||||||
| Financial liabilities in other payables and accruals | ||||||||||||
| Lease liabilities | ||||||||||||
| Due to related companies | ||||||||||||
| Due to the Shareholder | ||||||||||||
| Total | ||||||||||||
| Total current | ||||||||||||
| Total non-current | ||||||||||||
| F-19 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 14. | FINANCIAL INSTRUMENTS (CONTINUED) |
| (c) | Fair value |
The following table provides the fair value measurement hierarchy of the Group's financial liabilities as at June 30, 2024:
Quoted prices in active markets (Level 1) (Unaudited) | Significant observable inputs(Level 2) (Unaudited) | Significant unobservable inputs(Level 3) (Unaudited) | Total | |||||||||||||
| CNY | CNY | CNY | CNY | |||||||||||||
| Financial liabilities | ||||||||||||||||
| Derivative financial liabilities | ||||||||||||||||
Quoted prices in active markets (Level 1) (Unaudited) | Significant observable inputs(Level 2) (Unaudited) | Significant unobservable inputs(Level 3) (Unaudited) | Total | |||||||||||||
| US$ | US$ | US$ | US$ | |||||||||||||
| Financial liabilities | ||||||||||||||||
| Derivative financial liabilities | ||||||||||||||||
There are no financial assets measured at fair value as of December 31, 2023 and June 30,2024.
| F-20 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 15. | FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES |
The financial instruments of the Group primarily include cash and cash equivalents, trade and bills receivable, other receivables, contract assets, derivative financial liabilities, trade payables, other payables, dividends payable, amounts due to related companies, amounts due to the Shareholder, lease liabilities and interest-bearing loans and borrowings.
The Group is exposed to credit risk, foreign currency risk, interest rate risk, business and economic risk and liquidity risk. The Group has not used any derivatives or other instruments for hedging purposes. The Group does not hold or issue derivative financial liabilities for trading purposes. The Group reviews and agrees policies for managing each of these risks and they are summarized below.
| (a) | Credit risk |
Management has a credit policy in place and the exposures to credit risk are monitored on an ongoing basis. Debts are usually due within 30 to 90 days from the date of billing.
Management groups financial instruments based on shared credit risk characteristics, such as instrument type and credit risk ratings for the purpose of determining significant increase in credit risk and calculation of impairment. The carrying amount of each financial asset in the condensed interim consolidated statement of financial position represents the Group’s maximum exposure to credit risk in relation to its financial assets.
A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred. Evidence that a financial asset is credit-impaired includes observable data about the following events:
- significant financial difficulty of the debtor
- a breach of contract such as a default or past due event; or
- it is probable that the debtor will enter bankruptcy or other financial reorganization.
To manage credit risk arising from trade receivables and contract assets, the credit quality of the debtors is assessed, taking into account their historical settlement records, past experience and other factors. The Group applies the simplified approach to provide for ECLs prescribed by IFRS 9, which permits the use of lifetime expected loss provision for all trade receivables. The ECLs also incorporated forward-looking information.
For financial assets assessed for impairment under the general approach, the Group established a policy to perform an assessment at the end of each reporting period of whether a financial instrument’s credit risk has increased significantly since initial recognition, by considering the change in the risk of default occurring over the remaining life of the financial instrument. The Group groups its other receivables into Stage 1, Stage 2 and Stage 3, as described below:
Stage 1 – When other receivables are first recognized, the Group recognized an allowance based on 12 months’ ECLs.
Stage 2 – When other receivables have shown a significant increase in credit risk since origination, the Group records an allowance for the lifetime ECLs.
Stage 3 – Other receivables are considered credit-impaired. The Group records an allowance for the lifetime ECLs.
| F-21 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
15. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
| (a) | Credit risk (continued) |
Management also makes periodic collective assessments for other receivables and amounts due from related companies as well as individual assessments of the recoverability of other receivables based on historical settlement records, past experience and other factors. The Group classified other receivables and amounts due from related companies in Stage 1 and continuously monitored their credit risk. Management believes that there is no material credit risk inherent in the Group’s outstanding balance of other receivables as of December 31, 2023 and June 30, 2024.
The Group does not provide any guarantees that would expose the Group to credit risk. There is no further quantitative disclosures in respect of the Group’s exposure to credit risk arising from financial assets as of December 31, 2023 and June 30, 2024.
Cash and cash equivalents
The Group maintains its cash and cash equivalents primarily with various PRC state-owned banks and Hong Kong based financial institutions, which management believes are of high credit quality. The Group performs periodic evaluations of the relative credit standing of those financial institutions.
| (b) | Foreign currency risk |
Foreign currency risk primarily arises from certain significant foreign currency deposits denominated in US$ and HK$ and related exposures are disclosed in Note 12. The Group Treasury closely monitors the international foreign currency market on the change of exchange rates and takes these into consideration when investing in foreign currency deposits and borrowing loans.
CNY is not freely convertible into foreign currencies. The State Administration for Foreign Exchange, under the authority of the People's Bank of China, controls the conversion of CNY into foreign currencies. The value of CNY is subject to changes in PRC government policies and to international economic and political developments affecting the supply and demand in the China Foreign Exchange Trading System market. All foreign exchange transactions continue to take place either through the People's Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People's Bank of China.
There is no significant exposure to foreign currency risk as of December 31, 2023 and June 30, 2024 for the Company.
| (c) | Interest rate risk |
The fair value interest rate risk of the Group mainly arises from long-term loans at fixed rates. As the fluctuation of comparable interest rate (Loan Prime Rate of PRC market) with similar term was relatively low, the Directors are of the opinion that the Group is not exposed to any significant fair value interest rate risk for its fixed interest rate borrowings held as of December 31, 2023 and June 30, 2024.
| (d) | Business and economic risk |
The Group's operations may be adversely affected by significant political, economic and social uncertainties in the PRC. Although the PRC government has been pursuing economic reform policies for more than 40 years, no assurance can be given that the PRC government will continue to pursue such policies or that such policies may not be significantly altered, especially in the event of a change in leadership, social or political disruption or unforeseen circumstances affecting the political, economic and social conditions in the PRC. There is also no guarantee that the PRC government's pursuit of economic reforms will be consistent or effective.
| F-22 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
15. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTINUED)
| (e) | Liquidity risk |
The Group manages its liquidity risk by regularly monitoring its liquidity requirements and its compliance with debt covenants to ensure that it maintains sufficient cash and cash equivalents, as well as adequate time deposits to meet its liquidity requirements in the short and long term.
The table below summarizes the maturity profile of the Group’s financial liabilities and lease liabilities based on contractual undiscounted payments:
December 31, 2023 (Audited) | On demand | Less than 1 year | 1 to 5 years | More than 5 years | Total | |||||||||||||||
| CNY | CNY | CNY | CNY | CNY | ||||||||||||||||
| Trade payables | ||||||||||||||||||||
| Financial liabilities in other payables and accruals | ||||||||||||||||||||
| Due to related companies | ||||||||||||||||||||
| Due to the Shareholder | ||||||||||||||||||||
| Lease liabilities | ||||||||||||||||||||
| Total | ||||||||||||||||||||
June 30, 2024 (Unaudited) | On demand | Less than 1 year | 1 to 5 years | More than 5 years | Total | |||||||||||||||
| CNY | CNY | CNY | CNY | CNY | ||||||||||||||||
| Derivative financial liabilities | ||||||||||||||||||||
| Trade payables | ||||||||||||||||||||
| Financial liabilities in other payables and accruals | ||||||||||||||||||||
| Due to related companies | ||||||||||||||||||||
| Due to the Shareholder | ||||||||||||||||||||
| Lease liabilities | ||||||||||||||||||||
| Total | ||||||||||||||||||||
June 30, 2024 (Unaudited) | On demand | Less than 1 year | 1 to 5 years | More than 5 years | Total | |||||||||||||||
| US$ | US$ | US$ | US$ | US$ | ||||||||||||||||
| Derivative financial liabilities | ||||||||||||||||||||
| Trade payables | ||||||||||||||||||||
| Financial liabilities in other payables and accruals | ||||||||||||||||||||
| Due to related companies | ||||||||||||||||||||
| Due to the Shareholder | ||||||||||||||||||||
| Lease liabilities | ||||||||||||||||||||
| Total | ||||||||||||||||||||
| (f) | Capital management |
The Group monitors capital on the basis
of the debt to capital ratio, which is calculated as interest-bearing debt divided by total capitalization. Interest-bearing debt mainly
includes lease liabilities and interest-bearing loans and borrowings. Total capitalization includes total equity and interest-bearing
debt. The debt to capital ratio was
| F-23 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 16. | EQUITY |
| (a) | Issued capital |
| December 31, | June 30, | |||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Audited) | (Unaudited) | (Unaudited) | ||||||||||
| Preferred shares authorized: June 30, 2024: 10,000,000, (December 31, 2023: 10,000,000) preferred shares, no par value | ||||||||||||
| Preferred shares issued and fully issued paid: June 30, 2024: Nil, (December 31, 2023: Nil) preferred shares, no par value | ||||||||||||
| Common shares authorized: June 30, 2024: 200,000,000, (December 31, 2023: 200,000,000) common shares, no par value | ||||||||||||
| Common shares issued and fully paid: | ||||||||||||
| June 30, 2024: 9,865,767*, (December 31, 2023: 8,377,897) common shares, no par value | ||||||||||||
| Number of shares | Share capital | |||||||||||
| CNY | US$ | |||||||||||
| As of January 1, 2023 | ||||||||||||
| Effect of Five-to-One Share Combination | ( | ) | — | — | ||||||||
| Equity-settled share-based payments | — | — | ||||||||||
| As of December 31, 2023 and January 1, 2024 | ||||||||||||
| Common shares issued through private placement* | — | — | ||||||||||
| As of June 30, 2024 | ||||||||||||
| F-24 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 16. | EQUITY (CONTINUED) |
* On February 16, 2024, the Company entered into a securities purchase agreement with certain institutional investors, pursuant to which the Company agreed to issue and sell, (i) in a registered direct offering, up to an aggregate of of common shares with no par value of the Company at a per share purchase price of US$(the “Registered Offering”), and (ii) in a concurrent private placement, warrants initially exercisable for the purchase of an aggregate of common shares of the Company at an exercise price of $per share. The registered Offering was closed on February 21, 2024.
The Company recognized the warrants issued to the investors as derivative financial liabilities (Note 14.b) at the fair value of the warrants on the issue date, which amounted to CNY (US$*), as the investors have the right to exercise their warrants on a cashless basis according to the agreement clause. Per IAS 32, a contract settled by a single net payment (generally referred to as net cash-settled or net equity-settled as the case may be) is a financial liability and not an equity instrument. The gross proceeds of this offering less the fair value of warrants issued to investors amounted to CNY (US$*) and was recorded in share capital.
Upon the closing of this offering and the private placement, the Company paid or committed to pay fees and offering expenses of CNY (US$*), which consists of 8% of gross proceeds and certain expenses reimbursement to the placement agent in cash and the offering expenses related to other professional services. The total amount of fees and offering expenses were allocated to the issuance of common shares and investor warrants according to their fair value at the date of issuance. The amount allocated to the issuance of the shares of CNY (US$*) have been charged directly to equity as a reduction in share capital. The amount allocated to the issuance of investor warrants of CNY1,836 (US$255*) were expensed and are included in administrative expenses. The Company recognized a fair value gain of CNY (US$ ) on the derivative financial liabilities (Note 5) from the closing date to June 30, 2024.
*As the changes in equity from this private placement transaction are dominated in US$, all the amount in US$ of this disclosure paragraph are actual transaction amount and corresponding amount in CNY were translated from US$ at the applicable exchange rate of the closing date.
| (b) | Other capital reserve |
Other capital reserves of the Company are mainly for equity-settled share-based compensation, the exercise of stock options, the exercise of warrants, the business combination and the deemed contribution from the Shareholder of the Company and related companies.
| F-25 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
| 17. | SHARE-BASED PAYMENTS |
The issuance of warrants to the placement agent
As mentioned in Note 16(a), in addition
to fees and offering expenses paid in cash to the placement agent, the Group issued to the placement agent warrants to purchase an aggregate
of up to five percent (5%) of the aggregate number of Shares sold in the Registered Offering (the “Placement Agent Warrants”).
The Placement Agent Warrants shall generally be on the same terms and conditions as the Investors Warrants except that they will be exercisable
at a price of $ per share. The issuance of the agent warrants is an equity-settled share-based payment for professional services received
from the placement agent. The Company recognized other capital reserves in an amount of CNY
The fair value of the agent warrants is estimated at the issue date using a binomial lattice pricing model using significant observable inputs including underlying spot price of the Company's ordinary shares, exercise price, time to expiration, risk-free rate and equity volatility, etc.
*As the changes in equity from this private placement transaction are dominated in US$, all the amount in US$ of this disclosure paragraph are actual transaction amount and corresponding amount in CNY were translated from US$ at the applicable exchange rate of the transaction date, February 21, 2024.
| 18. | RELATED PARTY BALANCES AND TRANSACTIONS |
In addition to the transactions detailed elsewhere in the consolidated financial statements, the Group had the following transactions with related parties during the period:
(a) Commercial transactions with related companies
| Six months ended June 30, | ||||||||||||||||
| 2023 | 2024 | 2024 | ||||||||||||||
| CNY | CNY | US$ | ||||||||||||||
| Notes | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
| CHNR's share of office rental, rates and others to Anka Consultants Limited (“Anka”) * | (i) | |||||||||||||||
| Feishang Management's share of office rental to Feishang Enterprise** | (ii) | |||||||||||||||
| Shenzhen New Precise Space-Time Technology Co., Limited (“Shenzhen New PST”)’s share of office rental to Feishang Enterprise** | ||||||||||||||||
| (i) |
| (ii) |
| F-26 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
18. RELATED PARTY BALANCES AND TRANSACTIONS (CONTINUED)
| (b) | Other transactions with related parties |
On February 27, 2023, the Company entered into a sale and purchase agreement (the “SPA”) with Feishang Group and Top Pacific (China) Limited (together, the “Sellers”), and the respective beneficial owner of the sellers, Mr. Li Feilie and Mr. Yao Yuguang, to acquire 100% equity interests of Greatfame Investments Limited, which owns 100% equity interest in Williams Minerals (Pvt) Ltd (“Williams Minerals”) (the “Acquisition”). Williams Minerals owns the mining permit for the Zimbabwean lithium mine. The consideration to be paid by the Company for the Acquisition will be calculated by multiplying the qualified measured, indicated and inferred resources quantity of lithium oxide proven to be in the mine by independent technical reports by a unit price of US$500 per ton, less certain due diligence costs and expenses incurred by the Company for the issuance of the independent technical reports.
According to the SPA, the Company issued a US$ promissory note (Promissory Note No. 1) and a US$ promissory note to Feishang Group and Top Pacific (China) Limited respectively on April 14, 2023 to proceed with the acquisition. The Company recognized a liability due to shareholders amounted to US$ and other payable amounted to US$ respectively for the present obligations of these two promissory notes with corresponding non-current assets amounted to US$.
On August 3, 2023, the Company entered into a set-off letter with Feishang Group, pursuant to the letter, the consideration of CNY95,761 liable to be paid by Feishang Group pursuant to the SPA for the disposal of the water treatment segment (Note 3) shall be set off against Promissory Note No. 1 using the exchange rate CNY1.00 = US$0.1400 such that a sum of US$13,407 shall be deducted from the Principal Amount as defined in Promissory Note No. 1. According to the letter, the Company derecognized the receivables from Feishang Group amounted to CNY95,761 and a liability due to shareholders amounted to CNY95,761.
Completion of the transaction as contemplated by the SPA is contingent upon the satisfaction of a number of conditions, including, among other things, the issuance of independent technical reports, the actual quantity of qualified lithium oxide metal resources proven or estimated to exist in each mining area covered by the relevant report, and the Company’s full settlement of the purchase consideration.
| F-27 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
18. RELATED PARTY BALANCES AND TRANSACTIONS (CONTINUED)
| (c) | Balances with related companies |
The Company’s balances with related companies are unsecured and non-interest bearing. Feishang Enterprise and the Shareholder have provided letters stating their continuous financial support to the Group and that they will not recall any amounts due to them until the Group has sufficient liquidity to finance its operations. The balances are summarized as follows:
| December 31, | June 30, | |||||||||||||||
| 2023 | 2024 | 2024 | ||||||||||||||
| CNY | CNY | US$ | ||||||||||||||
| Notes | (Audited) | (Unaudited) | (Unaudited) | |||||||||||||
| Current: | ||||||||||||||||
| Payable to related companies: | ||||||||||||||||
| Feishang Enterprise** | (i) | |||||||||||||||
| Anka Capital Limited (“Anka Capital”)* | (ii) | |||||||||||||||
| Payable to the Shareholder: | ||||||||||||||||
| Feishang Group** | (iii) | |||||||||||||||
| Feishang Group** | ||||||||||||||||
| Lease liabilities to related parties | ||||||||||||||||
| Anka* | ||||||||||||||||
| Total | ||||||||||||||||
| (i) |
| (ii) |
| (iii) |
* Anka Capital and Anka are each jointly owned by Wong Wah On Edward and Tam Cheuk Ho, who are officers of the Company.
**Feishang Enterprise and Feishang Group are controlled by Mr. Li Feilie, who is the controlling shareholder of the Company.
| F-28 |
CHINA NATURAL RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Amounts in thousands, except share and per share data) |
18. RELATED PARTY BALANCES AND TRANSACTIONS (CONTINUED)
| (d) | Compensation of key management personnel of the Group |
| Six months ended June 30, | ||||||||||||
| 2023 | 2024 | 2024 | ||||||||||
| CNY | CNY | US$ | ||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||
| Wages, salaries and allowances | ||||||||||||
| Housing subsidies | ||||||||||||
| Contribution to pension plans | ||||||||||||
| Total | ||||||||||||
The amounts disclosed in the table are the amounts recognized as expenses during the respective period related to key management personnel.
| 19. | COMMITMENTS |
At June
30, 2024 the Company had capital commitments of CNY
| 20. | SUBSEQUENT EVENTS |
On December 31, 2024, the Company entered into a second amendment agreement to the Zimbabwe SPA to extend the long stop date for closing the acquisition from December 31, 2024 to December 31, 2025.
| 21. | APPROVAL OF THE INTERIM FINANCIAL STATEMENTS |
These interim condensed consolidated financial statements were approved by the Board of Directors on December 31, 2024.
F-29
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
The following discussion contains statements that constitute forward-looking statements within the meaning of the U.S. federal securities laws. These statements appear in a number of places throughout this report and include, without limitation, statements regarding the intent, belief and current expectations of China Natural Resources, Inc. (the “Company,” and together with its subsidiaries, the “Group”), its directors or its officers with respect to the applicability of US taxes to the Company, the availability of internally generated funds and funds for the payment of operating expenses, the sufficiency of working capital for present operations and over the next twelve months and access to capital, and its intent to locate and execute on strategic opportunities. Forward-looking statements are not a guarantee of future performance and involve risks and uncertainties, and actual results may differ materially from those in the forward-looking statement as a result of various factors. Among the risks and uncertainties that could cause our actual results to differ from our forward-looking statements are: uncertainties regarding the governmental, economic and political circumstances in the PRC; the impact on the Company’s financial position, growth potential and business of in the sale of PST Technology and Shanghai Onway specifically; uncertainties related to the Company’s ability to identify potential partners or acquisition targets as it considers strategic alternatives in non-natural resources sectors; uncertainties associated with metal price volatility; uncertainties concerning the viability of mining and estimates of reserves at the Company’s Wulatehouqi Moruogu Tong Mine in Inner Mongolia; uncertainties regarding our ability to acquire a mining permit and to extract mineral reserves located in the Moruogu Tong Mine in an economically feasible manner; uncertainties related to our ability to fund operations and capital expenditures; uncertainties relating to the acquisition of Williams Minerals that were not discovered by us through our due diligence investigation; uncertainties related to the completion of the acquisition of Williams Minerals which is conditional upon satisfaction or waiver of various conditions; failure to complete the acquisition of Williams Minerals may have a material adverse effect on the Company’s business, financial condition and results of operations; uncertainties related to the realization of the anticipated benefits associated with it; the potential lack of appetite for the Company’s current holdings as consideration for a transaction; uncertainties related to geopolitical events and conflicts, such as the conflict between Russia and Ukraine; uncertainties regarding the impact of climate change on our operations and business; uncertainties related to possible future increases in operating expenses; the fluctuations of interest rates and foreign exchange rates; the results of the next assessment by the Staff of the Nasdaq Listing Qualifications department of the Company’s compliance with the Nasdaq Listing Rules; uncertainties related to the political situation between the PRC and the United States, the ability of the Public Company Accounting Oversight Board to inspect auditors located in the PRC and Hong Kong, the implementation by the U.S. Securities and Exchange Commission of more stringent disclosure and/or other requirements for companies located in the PRC, potential negative impacts on companies with operations in the PRC that are listed on exchanges in the United States, and increasing regulation by PRC government agencies of companies located in the PRC but listed elsewhere; and other risks detailed from time to time in the Company's filings with the U.S. Securities and Exchange Commission, including without limitation the information set forth in our Annual Reports on Form 20-F under the heading “Risk Factors.” When, in any forward-looking statement, the Company, or its management, expresses an expectation or belief as to future results, that expectation or belief is expressed in good faith and is believed to have a reasonable basis, but there can be no assurance that the stated expectation or belief will result or be achieved or accomplished. Except as required by law, the Company undertakes no obligation to update any forward-looking statements.
ADMINISTRATIVE EXPENSES
Administrative expenses for the six months ended June 30, 2024 were CNY4.00 million (US$0.55 million), as compared to expenses of CNY4.88 million for the same period in 2023. The decrease was mainly due to the professional service fees incurred in 2023 in relation to the Company’s potential acquisition of Zimbabwe lithium mines.
OTHER INCOME
Other income for the six months ended June 30, 2024 was nil, as compared to CNY0.50 million for the same period in 2023. The change was mainly caused by other income relating to impairment reversal of other receivables, which were fully impaired and written off in prior years but collected in 2023.
FAIR VALUE (LOSS)/ GAIN ON FINANCIAL INSTRUMENTS, NET.
Fair value gain on financial instruments for the six months ended June 30, 2024 was CNY3.86 million (US$0.53 million), as compared to a loss of CNY0.09 million for the same period in 2023. The amount represented the fluctuation of fair values of the Company’s outstanding warrants.
| 1 |
INCOME TAX EXPENSE
Management believes that the Company is not subject to US taxes.
Under the current laws of the British Virgin Islands (“BVI”), the Company and its subsidiaries incorporated in the BVI are not subject to tax on income or capital gains.
The Hong Kong Profits Tax rate is 16.50%. The Company’s Hong Kong subsidiaries have both Hong Kong–sourced and non-Hong Kong–sourced income. The latter is not subject to Hong Kong Profits Tax and the related expenses are non-tax-deductible. For the Hong Kong–sourced income, no provision for Hong Kong Profits Tax was made as such operations sustained tax losses during the period ended June 30, 2023 and 2024. Furthermore, there are no withholding taxes in Hong Kong on the remittance of dividends.
Under the Law of the PRC on corporate income tax and the Implementation Regulation of the Corporate Income Tax Law (collectively, the “CIT Law”), the Company’s PRC subsidiaries are generally subject to PRC corporate income tax at the statutory rate of 25% on their respective estimated assessable profits for the six months ended June 30, 2023 and 2024.
LOSS FOR THE PERIOD FROM DISCONTINUED OPERATIONS, NET OF TAX
The loss for the period from discontinued operations, net of tax was nil for the period ended June 30, 2024, as compared with CNY4.96 million for the same period in 2023. The loss in 2023 was the result of an expected credit loss assessment of receivables and contract assets, due to the fact that the amount of uncollected and aged receivables and contract assets was relatively higher than the amount in 2022.
LOSS FOR THE PERIOD
As a result of the foregoing, our net loss decreased by CNY9.34 million (US$1.29 million), from CNY9.46 million for the period ended June 30, 2023 to CNY0.12 million (US$0.02 million) for the period ended June 30, 2024.
LIQUIDITY AND CAPITAL RESOURCES
The Company’s primary liquidity needs are to fund operating expenses, capital expenditures and acquisitions. To date, the Company financed its working capital requirements and capital expenditures through internally generated cash from prior years, non-interest-bearing loans from the related parties, funds provided pursuant to the mutual cooperation agreement with Bayannaoer Jijincheng Mining Co., Ltd., and the issuance of shares and warrants in 2024. As the wastewater treatment business was disposed on July 28, 2023, and the Wulatehouqi Moruogu Tong Mine ("Moruogu Tong Mine") is still in the pre-revenue exploration stage, the Company expect our operations to continue to be funded through internally generated cash reserves from prior years, non-interest-bearing loans from related parties, and funds provided pursuant to the Cooperation Agreement. Feishang Group Limited and Feishang Enterprise Group Company Limited, related parties which have provided non-interest-bearing loans, have confirmed they will not recall any amounts due to them until the Group is in a position to settle the amounts due without having a detrimental impact on the financial resources of the Group.
Net cash used in operating activities for the six months ended June 30, 2024 was approximately CNY11.85 million (US$1.63 million), as compared to net cash inflows of CNY3.05 million for the corresponding period in 2023. The decrease of cash inflows from operating activities was mainly caused by the disposal of PSTT, the water treatment business, on July 28, 2023.
Net cash used in investing activities for the six months ended June 30, 2024 was CNY4.00 thousand (US$1 thousand), as compared to CNY1.05 million for the corresponding period in 2023. The cash outflows in 2023 mainly represent expenditures on mine development.
Net cash from financing activities for the six months ended June 30, 2024 was CNY15.84 million (US$2.18 million), as compared to net cash outflows of CNY1.60 million for the corresponding period in 2023. The increase in cash from financing activities was a result of proceeds from the private placement in February 2024.
The following summarizes the Company's financial condition and liquidity at the dates indicated:
| December 31, | June 30, | |||||||
| 2023 | 2024 | |||||||
| (Audited) | (Unaudited) | |||||||
| Current ratio | 0.03 | x | 0.06 | x | ||||
| Working capital (CNY'000) | (171,934 | ) | (157,971 | ) | ||||
OFF BALANCE SHEET ARRANGEMENTS
The Company has no off-balance sheet arrangements that have had or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that would be material to investors.
| 2 |