Last Year's Record Performance, Chifeng Gold Chairman "Reflects" in Annual Report: Stripping Away Gold Price Gains, What's the True Color of Organic Growth?

Our reporter Xu Shuai, edited by Huang Sheng

Recently, Chifeng Gold (SH600988) disclosed its 2025 annual report, delivering its best-ever historical performance with revenue exceeding 12.6 billion yuan and net profit increasing nearly 75%.

However, before the release of this “strongest annual report,” Chifeng Gold has already experienced a change in control.

The company’s actual controller, Li Jinyang, is planning to transfer her shares. The widow of Zhao Meiguang, the company’s founder, who inherited all of his estate just over four years ago, chose to step back at the peak of the company’s performance. At this sensitive moment, outsiders find it difficult to gauge her true intentions. In the 2025 annual report, it is rare to see Chairman Wang Jianhua systematically summarize the past few years; some wording is emotional and candid about issues. He stated that if we strip away the benefits of rising gold prices, how substantial is the company’s internal growth? He also emphasized that dwelling on past achievements does not help solve future problems.

Company releases “Strongest Annual Report”

On the evening of March 20, Chifeng Gold, a leading gold company with a market value exceeding 70 billion yuan, disclosed its 2025 annual report, which is considered the “strongest annual report” since the company’s founding.

In 2025, Chifeng Gold achieved operating revenue of 12.639 billion yuan, a year-on-year increase of 40.03%. Net profit attributable to shareholders reached 3.082 billion yuan, up 74.70% from the previous year.

By industry, core mining operations generated revenue of 12.412 billion yuan, with a gross profit margin of 53.60%, an increase of 8.62 percentage points from the previous year. Notably, mineral gold performed exceptionally well, with revenue of 11.339 billion yuan and a gross margin of 58.51%, a significant increase of 11.55 percentage points year-over-year. On the cost side, the all-in sustaining cost (AISC) for mineral gold in 2025 was 372.63 yuan per gram, up 32.52% from the previous year.

As of the end of 2025, the company’s total assets reached 24.981 billion yuan, an increase of 22.89% from the beginning of the year. Thanks to operational accumulation and funds raised through the Hong Kong stock market, the company’s debt-to-asset ratio significantly decreased from 47.25% at the start of the year to 33.91%, a drop of 13.34 percentage points. Interest-bearing debt was approximately 877 million yuan, down 67.45% from the beginning of the year. Net cash flow from operating activities was 5.556 billion yuan, a year-on-year increase of 69.97%.

In terms of main business revenue, about 71.20% came from overseas mines. Overseas regions generated revenue of 8.988 billion yuan with a gross margin of 45.85%; domestic regions achieved revenue of 3.635 billion yuan with a gross margin of 68.93%.

Chifeng Gold achieved double growth in resource reserves and reserves by 2025. As of December 31, 2025, the company’s gold resources totaled 512 tons, a 31% increase from the end of 2024; gold reserves were 105.76 tons, up 41%. In terms of production, mineral gold output in 2024 was 15.16 tons, ranking fifth nationwide.

Returning to the tasks mentioned in the 2025 annual report, the company’s gold production target for 2026 is 14.7 tons, and electrolytic copper is targeted at 11,000 tons. The company emphasizes that 2026 is a crucial year laying the foundation for a surge in output from 2028 to 2030.

Previous Controller Planning to Exit

While Chifeng Gold’s performance reached historic highs, its actual controller chose to “step back quickly.” Before the 2025 annual report was disclosed, the company’s stock was suspended. Li Jinyang and her concerted parties are planning to transfer their holdings, which may lead to a change in control.

Li Jinyang, 43, is the widow of Zhao Meiguang, the founder of Chifeng Gold. Both are from Jilin City, Jilin Province. Zhao Meiguang passed away in December 2021 at age 59, with all his estate inherited by Li Jinyang. The company’s actual control then shifted to her.

As of the end of Q3 2025, Li Jinyang and her concerted parties held a total of 12.73% of the shares. Based on the pre-suspension market value of 77.6 billion yuan, this stake was worth approximately 9.87 billion yuan.

In fact, Li Jinyang has rarely been involved in the company’s operations, always emphasizing full cooperation with the management team led by Chairman Wang Jianhua and obeying the company’s strategic development plan. Since inheriting her shares, she has expressed a strong desire to exit. Just three months after becoming the actual controller, in March 2022, she signed a share transfer agreement with a trust plan, proposing to transfer 5.77% of shares at 16.79 yuan per share, claiming this was to optimize the equity structure, introduce strategic investors, and raise funds to repay debts.

Chairman Reflects in Annual Report

Since the 2024 annual report, Chifeng Gold has added a message from the chairman. Compared to the previous year, the 2025 message is more emotional, with more comprehensive reflections on the past years.

In the 2024 annual report, Chairman Wang Jianhua focused on the organizational logic and benefit distribution mechanisms of the team. He briefly introduced the core team driving the company’s achievements and shared the vision and philosophy they uphold.

At that time, he emphasized the company’s commitment to “joint efforts and shared success among owners, operators, and workers,” and promoted employee shareholding to ensure that value-creating workers participate in capital gains. He proposed that management adhere to the principle of “zero privilege, zero profit from power,” prioritizing top treatment for frontline workers and fostering internal leadership to become true entrepreneurs.

In the 2025 annual report, Wang Jianhua repeatedly mentioned “releasing kindness” and regarded it as the greatest certainty in responding to external uncertainties. He clearly stated: “All changes in the company will revolve around the management theme of ‘releasing kindness, everything for people.’”

Regarding organizational governance, he said the company upholds the philosophy that management is about allowing the team to fully release kindness, despising indifference and privilege. Senior executives have long worked on the front lines of mines, living and eating with miners, and strictly enforce personal expense audits and supervision. He emphasized that norm, integrity, and righteousness should become normal and habitual, making the company a long-term investment-worthy entity.

In 2025, Chifeng Gold’s net profit hit a record high, but during this performance surge, Wang Jianhua demonstrated deep crisis awareness and systematic self-reflection.

He posed a reflection to management and investors: “If we strip away the benefits of rising gold prices, how substantial is our internal growth?” He warned the team that dwelling on past achievements does not help solve future problems. In 2026, the company still faces many challenges, including geopolitical risks, resource competition, and cost control.

He reaffirmed the “only invest in gold” strategy established at the end of 2019, committed to being a focused and professional gold mining company. He lamented that divesting non-mining assets at that time was a “bold move,” but it was this resolve to “do what is right in the long term” that allowed the company to align with today’s gold price trend and prepare for larger fluctuations ahead. “Without extraordinary efficiency and benefits, it’s just coping; true effort comes with significant change.”

He concluded by stating that the company will continue to strive for substantial growth in operating performance, improve miners’ treatment, increase cash dividends, and share development results with shareholders and workers.

Public information shows Wang Jianhua was born in 1956, holds an MBA, and is a senior economist. His career is extensive, having led several industry-leading enterprises.

Early in his career, Wang served as General Manager and Party Secretary of Shandong Silk Import & Export Corporation. After entering the mining industry, he was Chairman and Party Secretary of Shandong Gold Group. Later, he served as Director and President of Zijin Mining Group Co., Ltd. (June 2013 to December 2016), and Chairman of Yunnan Baiyao Holdings Co., Ltd. (April 2017 to May 2018). In September 2018, Wang joined Chifeng Gold as a director and has been Chairman since December 2019.