Company code: China Railway Signal & Communication Corporation Limited(688009) company abbreviation: China Railway Signal & Communication Corporation Limited(688009) China Railway Signal & Communication Corporation Limited(688009)
Summary of annual report 2021
Section I important tips
1 the summary of this annual report comes from the full text of the annual report. In order to fully understand the company’s operating results, financial status and future development plan, investors should go to www.sse.com com. cn. The website carefully reads the full text of the annual report. 2 major risk tips
Please refer to the description of risks in Section IV “management discussion and analysis” of the company’s 2021 annual report. 3 the board of directors, the board of supervisors and the directors, supervisors and senior managers of the company guarantee the authenticity, accuracy and completeness of the contents of the annual report, and there are no false records, misleading statements or major omissions, and bear individual and joint legal liabilities. 4. All directors of the company attended the board meeting. 5 Ernst & Young Huaming Certified Public Accountants (special general partnership) issued a standard unqualified audit report for the company. 6. The company is not profitable and has not yet achieved profitability when it is listed □ yes √ No 7. The profit distribution plan or the plan for the conversion of provident fund into share capital in the reporting period adopted by the resolution of the board of directors
After deliberation at the 2nd meeting of the 4th board of directors, the company plans to distribute cash dividends of RMB 1.7 (including tax) to all shareholders for every 10 shares based on the total share capital of 10589819000 shares on December 31, 2021, totaling RMB 18 Yuan Cheng Cable Co.Ltd(002692) 30. The profit distribution plan needs to be deliberated and approved by the company’s 2021 annual general meeting of shareholders. 8. Whether there are important matters such as special arrangements for corporate governance □ applicable √ not applicable
Section II basic information of the company
1 company profile company stock profile √ applicable □ not applicable
Company stock profile
Stock type stock exchange stock abbreviation before stock code change stock abbreviation and sector
A-share Shanghai Stock Exchange Kechuang board China Railway Signal & Communication Corporation Limited(688009) China Railway Signal & Communication Corporation Limited(688009) none
H-share main board of Hong Kong Stock Exchange China Railway Signal & Communication Corporation Limited(688009) 03969 none
Profile of company depositary receipts □ applicable √ not applicable
Contact person and contact information
Contact person and contact information: Secretary of the board of directors (domestic representative of information disclosure)
Name: Hu Shaofeng
Office address: block a, China Railway Signal & Communication Corporation Limited(688009) building, yard 1, South Road of Automobile Museum, Fengtai District, Beijing
19th floor
Tel: 01050809286
E-mail [email protected].
2. Introduction to the company’s main business in the reporting period (I) main business, main products or services
Since its establishment, the company has undertaken the important task of developing national industry and national technology. For a long time, it has always focused on the research and exploration of rail transit control system technology and its derivative applications. As a core enterprise to ensure the safe operation of national rail transit, the company has continuously strengthened its own capacity-building, adhered to the dominant main business of rail transit, actively integrated into the new development pattern, and improved and upgraded the design, research and development of industry-leading rail transit control system The “Trinity” whole industry chain of equipment manufacturing and engineering services creates a long modern industrial chain of rail transit, and continues to provide global customers with high-quality integrated services of the whole industrial chain of rail transit control system. While providing safe and efficient core technical support for the operation of national rail transit, we continue to make use of our profound technological accumulation to expand new market areas and help the national modernization and digital development.
The core business of the company’s rail transit is: 1) design integration, mainly including providing system integration services for rail transit control system related products and providing design and consulting services for the construction of rail transit projects; 2) Equipment manufacturing, mainly including the production and sales of signal system, communication information system products and other related products; 3) System delivery mainly includes the construction of rail transit control system project, equipment installation and maintenance services.
While continuing to lead the business in the field of rail transit control system, the company implements the business strategy of “six cores in one and two wings”, constructs the industrial pattern of “rail transit + n”, and focuses on building an industrial group with rail transit as its characteristics, global leading system technology and world-class comprehensive strength. The company attaches great importance to technology accumulation and continuous innovation, takes innovation as the eternal theme and the first driving force of China Railway Signal & Communication Corporation Limited(688009) sustainable development, actively faces the world’s scientific and technological frontier, accelerates scientific and technological innovation and achievement transformation, leads the technological development of the industry, and strives to maintain the leading position of the industry. In the future, the company will scientifically grasp the new development stage, based on the advantageous business of rail transit control system, actively extend the core technology to other industries, focus on the national key strategic directions such as digital industry and new infrastructure, vigorously develop key businesses such as information communication and power electrification, refine and optimize the general contracting business, strive to expand the emerging pillar industries supporting the sustainable development of the company, and form a reasonable structure, scientific layout Collaborative and efficient diversified industrial pattern.
Since its establishment, the company’s main business has remained stable without major changes. （2） Main business model
Based on the field of China’s rail transit control system, the company has a deep understanding of China’s railway and urban rail transit policies, operation modes, market environment and other market elements, and the business model adopted fully adapts to the market environment, which is stable and efficient. The company’s order acquisition method is mainly through public bidding, and the acquisition of production raw materials is mainly through centralized procurement. Relying on the efficient and mature business model of design integration, equipment manufacturing and system delivery, the company provides customers with integrated and all-round services or customized professional services of rail transit control system.
1. Sales model
The company fully participates in the bidding and procurement activities of Chinese users and actively participates in the procurement activities of foreign users. The operation division of the company, as the centralized management department of marketing and sales, is responsible for formulating and revising the relevant systems of marketing and sales management, and supervising and inspecting the marketing and sales activities of the company at all levels.
The company gives full play to the industry’s core technology and brand influence, adheres to the purpose of putting user demand first, providing high safety, high reliability products and efficient services, and obtains product and service orders through market-oriented methods such as bidding and business negotiation.
2. Production and service mode
In order to comply with the overall operation mode of China’s railway and urban rail transit system, the company has established mature and stable business production and service modes such as design integration, equipment manufacturing and system delivery. At the same time, relying on strong technical strength, the company can provide customized production and services according to the specific needs of owners outside China. The relevant products and services provided by the company can be completed on schedule and with quality in strict accordance with the requirements of the contract. The operation business department of the company is the centralized management department of production services of design integration and system delivery business, and the scientific and technological innovation Department of the company is the centralized management department of production services of equipment manufacturing business. They are respectively responsible for formulating relevant production service management systems, and supervising and inspecting the production service activities of the company at all levels.
3. Procurement mode
All procurement activities of the company are carried out in strict accordance with relevant national laws and regulations and in accordance with China Railway Signal & Communication Corporation Limited(688009) procurement management measures. According to the actual situation, procurement methods such as public bidding, invitation bidding and competitive negotiation are selected to ensure procurement efficiency. The company mainly implements the centralized procurement system. The material and equipment business department of the company is the centralized management department of procurement activities, which is responsible for formulating and revising relevant procurement management systems, and supervising and inspecting the procurement activities of the company at all levels. The centralized procurement system is implemented at two levels, including the centralized procurement of the company’s headquarters and the centralized procurement of subordinate secondary enterprises. The secondary enterprises also have a perfect procurement management mechanism, and the full-time procurement department independently manages the procurement activities of subordinate enterprises.
4. Management mode
The company implements the market operation and management system in which the headquarters of the joint-stock company takes the lead in grasping the main operation of the general and secondary enterprises and the implementation of the three-level enterprises, and constructs a scientific and efficient internal organization system with connection from top to bottom, coordinated operation and high efficiency. By improving the management structure system of “headquarters – Secondary Enterprises – tertiary enterprises”, the “strategic guidance and control center – business operation and profit center – execution center and cost center” are connected. The headquarters highlights the positioning of six centers: strategic decision-making, resource allocation, safety and quality supervision, scientific and technological innovation planning, industrial incubation and risk control, and gives full play to the functions of strategic management and control, scientific and technological resource integration, Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) incubation and so on, Strengthen the “strategy + operation control” headquarters; Based on the seven center positioning of strategy implementation, market development, business operation, revenue and profit, scientific and technological innovation, safety and quality management and talent cultivation, secondary enterprises give full play to the role of business subject, innovation subject and industrial subject, and realize the double improvement of business and economic benefits; Three level enterprises adhere to the positioning of business execution and cost control, do a good job in business support, improve lean level, improve efficiency and efficiency, and form a higher quality input-output relationship. （3） Industry 1 Development stage, basic characteristics and main technical threshold of the industry
From the perspective of the global railway industry, according to the prediction of infrastructure construction investment in various regions of the world by Oxford economics, the total global railway investment will increase from US $382 billion in 2020 to US $565 billion in 2040, with a compound annual growth rate of 1.88%. From the perspective of cumulative investment scale, it is expected that the total investment in railway infrastructure in the 21 years from 2020 to 2040 will reach 5137 billion US dollars. In addition to China, Europe is still the largest area of railway infrastructure investment in the future. From 2020 to 2040, the cumulative scale of railway investment in Europe will reach 2385 billion US dollars, Asia (except China) will rank second, reaching 1602 billion US dollars, followed by 823 billion US dollars in the Americas, 169 billion US dollars in Australia and 158 billion US dollars in Africa. The construction of international railway infrastructure will still be at a high level.
In terms of China’s railway industry, during the 14th Five Year Plan period, China’s new railway business mileage is about 23700 kilometers, and the total investment in the railway market is expected to reach 3.5 trillion yuan, which is basically the same as that during the 13th Five Year Plan period. At the same time, China will add 3000 kilometers of intercity and urban (suburban) railways, and the total investment in the construction of special railway lines is expected to reach 800 billion yuan, China’s railway infrastructure construction will also be at a relatively high level. With the continuous growth of China’s railway operation mileage, the trend of railway investment from new construction to transformation and operation and maintenance is obvious. More than 5000 kilometers of high-speed railway opened and operated in the early stage of the Eleventh Five Year Plan and the twelfth five year plan have successively entered the period of major modification and construction. The general speed railway will continue to promote the reconstruction of channel projects focusing on the electrification, standard improvement, capacity expansion and reconstruction of existing lines. Therefore, China’s railway industry is in the stage of focusing on new construction and paying equal attention to new construction, upgrading and transformation.
From the perspective of the global urban rail transit industry, due to the influence of urban development stage and development mode, there are great differences in the structure of urban rail transit in various regions of the world. The urban rail transit in Asia and America is dominated by subway, and the urban rail transit in Europe is dominated by rail electric vehicles. According to the data of the International Federation of public transport (UITP), during the “14th five year plan” period, the new mileage of urban rail transit in the world (except China) was 1412 kilometers, of which the new mileage in Asia (except China) ranked first, reaching 667 kilometers, followed by the Americas, with a new mileage of about 520 kilometers. On the whole, there is still a certain market space.
From the perspective of China’s urban rail transit industry, during the 14th Five Year Plan period, China will add 3000 kilometers of urban rail transit operating mileage, which is the same as the new operating mileage in the 13th five year plan. By 2025, 50 cities in China will have opened and operated urban rail transit, of which Shanghai and Beijing will form a huge network of more than 1000 kilometers respectively. During the “14th five year plan” period, it is expected to maintain a high investment level. The scale of urban rail communication signal market is expected to reach 22 billion yuan per year, of which the scale of signal control system market is expected to be about 10 billion yuan per year. With the acceleration of urbanization, the traffic volume of second and third tier cities is growing rapidly, and the demand for line network encryption in the suburbs of first tier cities is increasing. The demand for the development of medium and small volume urban rail systems such as straddle monorail, urban (suburban) fast rail, rail electric vehicle and automatic guided rail transit will be released step by step. China’s urban rail transit industry is in a period of stable development.
Firstly, the rail transit control system industry has the basic characteristics of high core technology threshold. The products and services provided have high requirements for safety, reliability, stability and sustainability. Relevant providers must have strong anti risk ability in order to provide products and services for a long time. Secondly, the industry also has significant cyclical characteristics, which is determined by the characteristics of rail transit construction and maintenance and the iteration of core components of relevant product systems. According to the requirements of relevant technical specifications and industry practices, the life cycle of high-speed rail transit control system is generally about 10-15 years, and the renewal cycle of some outdoor equipment systems is shorter due to environmental factors. 2. Analysis of the company’s industry position and its changes
As a world-class solution provider of rail transit control system, the company continues to maintain its leading position in the industry. By the end of 2021, the total winning mileage covered by the company’s core products and services of high-speed railway control system continued to rank first in the world; According to China’s high-speed railway control system integration project, track circuit in core equipment, centralized dispatching system, computer interlocking, CTCS-3 on-board automatic protection system, wireless block center, train control center and other products, the company’s market share continues to be in the leading position in the industry; In the field of urban rail transit in China, the company’s core urban rail transit control system products and related services cover more than 120 lines in all cities in China that have operated and completed the bidding of control system, and continue to lead strongly
