Shandong Gold Mining Co., Ltd. (“SD GOLD”, 01787) has signed a supplemental agreement with Shandong Gold Group Finance Co. (“SDG Finance”) to raise the ceilings for deposits and credit lines available under their existing Financial Services Framework Agreement for 2026-2027. The move, approved by the Board on 29 May 2026, aligns the group’s funding capacity with accelerating production, stronger cash flows and expanded overseas M&A activity.

Key revisions

1. Deposit Services • Maximum daily deposit balance: lifted from RMB3.80 billion to RMB4.20 billion for FY 2026 and to RMB4.50 billion for FY 2027 (31 Mar 2026 actual: RMB3.80 billion). • Annual interest-income cap: raised from RMB120 million to RMB150 million for both FY 2026 and FY 2027 (31 Mar 2026 actual: RMB13.23 million).

2. Financing Services • Maximum daily balance of loans and other financing: increased to RMB5.30 billion for FY 2026 and RMB5.60 billion for FY 2027 (31 Mar 2026 actual: RMB3.01 billion). • Maximum daily overdraft balance: lifted to RMB1.20 billion for FY 2026 and RMB1.30 billion for FY 2027 (31 Mar 2026 actual: RMB0.30 billion). • Aggregate annual credit facilities: expanded from RMB6.60 billion to RMB6.70 billion for FY 2026 and to RMB7.10 billion for FY 2027.

The caps for Other Financial Services—covering settlement, guarantees, FX and cross-border cash pooling—remain unchanged.

Rationale

• Working-capital needs are rising as SD GOLD’s operating cash flow grew by RMB6.06 billion year on year in 2025, with a net RMB0.40 billion added to centrally managed funds after restricted cash adjustments. • Sustained record-high gold prices and the first year of China’s 15th Five-Year Plan are propelling revenue, profit and cash generation, while the group’s international expansion and overseas projects are entering cash-return phases. • Existing credit limits nearly reached in 2025 (RMB3.57 billion peak loan balance) signal the need for additional headroom to finance working capital and M&A. • SDG Finance offers deposit rates no lower than benchmark PBOC levels and loan/bill rates no higher than comparable commercial banks, with bill services generally exempt from cash margin requirements—saving RMB0.44 billion and RMB0.39 billion in 2024 and 2025, respectively.

Regulatory framework

Under Hong Kong Listing Rule 14A, the revised deposit caps trigger announcement and reporting obligations (percentage ratios >0.1% but <5%), while the financing services remain fully exempt as they are on normal commercial terms without security. As SD GOLD is also SSE-listed, the supplemental agreement requires shareholder approval at an upcoming extraordinary general meeting, with controlling shareholder Shandong Gold Group and its associates abstaining.

Governance and controls

SD GOLD will continue to monitor SDG Finance’s liquidity via periodic reports and subject all transactions to annual external audit. Directors—except those deemed interested—unanimously consider the revised caps fair, reasonable and in the interests of all shareholders.

The supplemental agreement, effective upon completion of requisite approvals, will run to 31 December 2027, providing SD GOLD with enhanced financial flexibility to support its domestic operations and expanding global mining portfolio.