Abstract:

 In 2020, the Company reported zero major environmental incident across its global operations and 1.25 total recordable incident rate (“TRIR”) which outperforms global average as published by ICMM. The Company has also obtained BBB MSCI rating on sustainability for three years in a row, ranking among the top league of the industry.

 In 2020, the Company registered RMB112,981 million of revenue, up 65% year-on-year, RMB2,329 million net earnings attributable to the parent company, up 25% year-on-year, and RMB8,492 million net operating cash flows, up 398% year-on-year. The Board of Director proposed a total of RMB711 million (before tax) annual dividend distribution to shareholders.

 In 2020, the Company maintained stable production and operations across its business segments against the impact of the COVID-19, as represented by its 182,597 tonnes of copper and 15,436 tonnes of cobalt produced in CMOC DRC, 13,780 tonnes of molybdenum and 8,680 tonnes of tungsten in CMOC China, 9,300 tonnes of niobium and 1.09 million tonnes of phosphate in CMOC Brazil, and 26,997 tonnes of copper and 20,897 ounces of gold in NPM, CMOC Australia (based on 80% equity). IXM generated a trading volume (sales) of 5.34 million tonnes, contributing RMB772 million in net earnings attributable to the parent company.

 In 2020, the Company further optimized its organizational structure with adjustments and upgrades to the management and leadership positions and improvement in operations of all business units. The cost optimization initiatives continued to yield fruits, saving RMB2.93 billion in cash cost as compared to that of 2019.

 In 2020, the Company innovated its operational model and improved the quality of its asset portfolio. It successfully completed the acquisition of KFM, a copper-cobalt mine yet to be developed in the DRC, providing an increment to the mine resources and reserves and positioning CMOC as a stronger player in cobalt, a key source of EV material. The Company entered into a metal streaming transaction which is the first of its kind in China for USD550 million in cash, a deal that further strengthened the capital basis of the Company.

 The Company enhanced its ESG management to support more sustainable growth. In 2020, the “key economic contributions” worldwide by the Company was over RMB114 billion. Its ESG performance has obtained BBB MSCI rating for consecutive three years, ranking among top performers including international mining groups such as Rio Tinto and BHP Billiton.

Remarks by Sun Ruiwen, CEO of CMOC

The year 2020 is truly eventful. The COVID-19, as it spreads across the world, deals a hard blow on global economic order, and throws a critical test to risk management capability of global enterprises. In response, CMOC implemented in an efficient manner strict containment measures and mobilized global resources to enable a scientific defense against the pandemic and to guard the stability of our operations in and outside China. Whole year outputs of key metal products including copper, cobalt, molybdenum, and tungsten were well over expectations, while IXM reported record trading performance. Cost control and efficiency programs continued, achieving the 3-year cost optimization target of USD500 million one year ahead of schedule. Net earnings attributable to parent for 2020 is RMB2,329 million, up 25% as compared to that of 2019.

Guided by its vision of growing into a most respected, world-class, and modern resources company, CMOC continued to upgrade its organization and reshape its corporate culture with a global headquarters set up to lead an integrated international control framework. The experience in TFM offers a success case of stronger Chinese support in achieving cost and efficiency goals and is replicated in CMOC Brazil by sending a Chinese management team at around beginning of the year to further explore the best approach of localization when expanding overseas.

Early this year, the Company repurchased accumulatively 48.51 million shares by means of centralized bidding, which is planned to be used for share incentive plan with an eye to creating a long-term mechanism of sharing of both risks and profits among shareholders, the Company, the management team, and core employees. 
Going forward, CMOC will stick to the strategy of growth driven by two wheels, including one underpinned by the existing top-quality resources that envisage great development potential and one by a broader perspective around world markets for M&A opportunities in new energy metals. By upholding a culture of openness and transparency and developing incentive plans that encourage sharing of results, the Company is determined to attract more talents to build a management and technical team with extensive front-line experience and improve the efficiency of its mining operations. The Company has stepped up its efforts to develop the world-class assets in its existing portfolio for early transformation of resources into production and into economic benefits. The synergy between trading business of IXM and mining will be further explored, fostering a stronger mining + trading business integration.