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Hunan Gold Group Completed Asset Restructuring

Hunan Gold Corporation Limited, a listed subsidiary of Hunan Gold Group, recently implemented major asset restructuring and system reform, listed company renaming and relocation work, aiming to boost the Hunan gold enterprise to embark on a new journey.

Organized in 2006 by integrating state-owned old mines including Xiangxi Gold Mine, Huangjindong Mining, and Longshan Mining according to the decision by Hunan Provincial Government and the Provincial State-owned Assets Supervision and Administration Commission, Hunan Gold Group undertook the important mission of retaining and increasing the value of state-owned assets, expanding and consolidating Hunan gold industry. In the recent 10 years, Hunan gold industry endured hardship, made realistic innovation, and improved quality, by the end of last year, its assets had grown from 1.287 billion yuan to 8.52 billion yuan, its operating income grew from 1.473 billion yuan to 6.1 billion yuan, during the “Twelfth Five Year Plan” period it fulfilled over 3 billion yuan of total profit tax, triple that of the “Eleventh Five Year Plan” period; gold output grew from 4 tonnes to 15.5 tonnes, catapulting Hunan Province’s total gold output to rank fifth nationwide; output of antimony product grew from 13000 tonnes to 33000 tonnes, ranking No. 2 worldwide; lead and zinc output maintained annual average 16% above growth rate.

After long years of efforts, this group’s reserved resources increased significantly than at the time of setup: Gold reserve grew from 28.5 tonnes to 156 tonnes, antimony reserve grew from 133,000 tonnes to 252,900 tonnes, tungsten reserve grew from 25,000 tonnes to 108,600 tonnes, lead zinc reserve grew from 180,000 tonnes to 387,000 tonnes. In the recent two years, this group prospected 67 tonnes of gold in Huangjindong, and prospected several dozen tonnes of ultra large gold mine in Hezuo City, Gansu, with which it accomplished major breakthrough in prospecting mine and increasing reserve.

Aiming for further consolidation, expansion, and upgrading, this group devised and implemented major asset restructuring work, and injected Huangjindong Mining Company into Chenzhou Co., Ltd, and changed its name to “Hunan Gold Co., Ltd”. After painstaking efforts spanning 1 year and 9 months, the restructuring work received complete success, and brought positive and far-reaching impact: Firstly, in the process of asset securitization, state-owned assets gained value considerably, take Huangjindong’s subsidiary Dawan Mining as an example, in 2009 when it was acquired its asset was only over 20 million yuan, after the Group made investment in prospecting, it discovered over 30 tonnes of gold, the evaluation price of this time’s assets being injected into listed company reached over 900 million yuan; Secondly, the listed company’s platform operated in parallel with the Group, which can facilitate full utilization of the listed company’s platform for capital operation, promote the group and the listed company to gain rapid growth and expansion; thirdly, it straightened out management structure, solved the management authority issue after subsidiary company was merged into the listed company.