Recently, the 2023 annual report released by Shanghai Construction Engineering Group Co., Ltd. (hereinafter referred to as "Shanghai Construction Engineering", stock code "600170") shows that the company's operating income reached 304.628 billion yuan for the first time, with a year-on-year increase of 6.50%; The net profit attributable to the parent company was 1.558 billion yuan, up 14.91% year on year. The reporter of Economic Information Daily noted that in 2023, while the performance grew steadily, SCEG and its subsidiaries were subject to at least 45 administrative punishments from various departments such as ecological environment, housing construction, fire protection, civil defense, etc. for suspected violations. The maximum amount of single penalty is 990000 yuan, and the total fine is more than 3 million yuan.
Performance keeps growing, benefit growth is higher than scale growth
Public data shows that SCEG is a pioneer and pioneer in China's construction industry and the third largest ready mixed concrete supplier in China. After years of development, the company has formed a core business structure based on construction business, supported by design consulting business and building materials industry business, with real estate development business and urban construction investment business as two wings.
In 2023, the main business income from construction of Shanghai Construction Engineering Group will reach 264.965 billion yuan, an increase of 17.978 billion yuan; The main business income of the building materials industry was 16.758 billion yuan, an increase of 3.268 billion yuan; The main business income of design consultation was 5.858 billion yuan, an increase of 546 million yuan. From the perspective of growth, in 2023, SCEG's net profit attributable to parent company will grow by 14.91%, much higher than the 6.50% revenue growth, and the benefit growth will be higher than the scale growth.
In 2023, SCEG will sign a total of 431.8 billion yuan of new contracts. Among them, the Shanghai market accounted for 71%, and the projects of strategic partners and old customers accounted for 66% of the newly signed contracts, which became the ballast of the Group's business orders. Among the newly signed contracts for construction, 85% of the projects are invested by the government and state-owned enterprises. The newly signed contract for design consulting business was 22.8 billion yuan, slightly increasing the proportion. The building materials industry signed a new contract of 28.2 billion yuan, a record high. The real estate development business accelerated the project de transformation and accelerated the capital recovery.
SCEG said in its annual report that its core advantages are its own industrial chain, value chain and ecosystem. In the face of severe situations and challenges at home and abroad, the company actively docked with the national strategy of serving the country, deeply integrated ESG and the company's business development, went all out to expand the market, took the initiative to prevent and defuse risks, consolidated the trend of economic stability and recovery, and continued to highlight the strategic orientation of high-quality development. In 2023, the company will achieve new results in market expansion, rapid growth in emerging businesses, and remarkable achievements in transformation and development.
It is worth mentioning that in recent years, Shanghai Construction Engineering Group has actively expanded six emerging markets, including urban renewal, water conservancy and water services, ecological environment, industrial construction, construction services, and new infrastructure. Its "five business clusters+six emerging businesses" cover the whole industrial chain of investment, planning, design, construction, operation and maintenance, and upgrading, It can provide customers with efficient overall solutions for the whole life cycle of buildings. At the same time, the company closely focuses on national strategies such as the integration of the Yangtze River Delta, continues to promote the in-depth development of the "nationalization" strategy, consolidates and deepens the pattern of domestic regional market expansion on the basis of improving the market share of Shanghai, and covers more than 150 cities in 34 provincial administrative regions nationwide.
In addition, Shanghai Construction Engineering Group has contracted projects in 42 countries or regions overseas, and has won the honors of "China's Outstanding Enterprise in Foreign Contracting Projects", "Advanced Multinational Enterprise", "China's Golden Award for Social Responsibility in Foreign Contracting Projects", and "China's Best Executing Enterprise for Foreign Preferential Loan Projects" for many consecutive years.
19 environmental penalties in the whole year, totaling more than 1.8 million yuan
When the annual report disclosed "the situation of administrative punishment due to environmental problems", Shanghai Construction Engineering Group said frankly that in 2023, the company will be subject to 19 administrative punishments related to environmental problems due to night construction, construction dust and other matters, with a total amount of 1.8635 million yuan. However, in the annual report, SCEG did not disclose the details of 19 environmental penalties.
The reporter of the Economic Information Daily searched and sorted out the information about SCEG's administrative punishment for environmental problems through open channels such as Tianyancha. Among them, the number of administrative penalties with fines exceeding 10000 yuan is not small. The objects of punishment include many wholly-owned subsidiaries of Shanghai Construction Engineering Group, and a few companies have been fined many times.
For example, on April 23, 2023, the Administrative Penalty Decision No. 2310100001 issued by the Jiangchuan Road Sub district Office in Minhang District, Shanghai shows that the Fifth Construction Group of Shanghai Construction Engineering Group Co., Ltd. violated the relevant regulations of the Shanghai Municipal Environmental Protection Regulations by "failing to obtain the certificate as required to carry out construction operations that generate noise at night in areas where noise sensitive buildings are concentrated", RMB 62000 was fined.
On July 11, 2023, Tongchuan City Administration and Law Enforcement Bureau of Shaanxi Province issued the "Tongcheng Zhijianju Zi [2023] No. X10" administrative punishment decision, which shows that Shanghai Construction Seventh Construction Group Co., Ltd. did not take (temporary) construction roads due to "no coverage, hardening or greening measures have been taken in the area not under construction for the time being" If the hardening measures and the earthwork construction area do not take the measures of watering and dust suppression ", RMB 40000 will be fined; On December 19 of the same year, the Shanghai Jiading District Ecological Environment Bureau issued the "Hu 0114 HJ [2023] No. 66" administrative punishment decision, which showed that Shanghai Construction Seventh Construction Group Co., Ltd. was fined 14000 yuan for "the dust emission does not meet the dust control standards of the city".
On July 26, 2023, Yingpu Sub district Office of Qingpu District People's Government of Shanghai made the decision on administrative punishment No. 2314020113, which shows that Shanghai Construction Engineering Group No. 4 Construction Co., Ltd. was fined 20000 yuan for "failing to obtain the certificate as required to carry out construction operations that generate noise at night in areas where noise sensitive buildings are concentrated".
On August 8, 2023, Jiangsu Province Taicang Housing and Urban Rural Development Bureau issued the "Su Su Tai Zhu Jian Penalty Decision [2023] No. 38" administrative penalty decision, according to which Shanghai Construction Engineering First Construction Group Co., Ltd. was fined 10000 yuan for failing to formulate a dust pollution prevention plan during the construction process.
In November 2023, Shanghai Construction Engineering Second Construction Group Co., Ltd. was fined 8000 yuan by Tunchang County Comprehensive Administrative Law Enforcement Bureau of Hainan Province for failing to pump water and pollute the road surface as required.
It is worth noting that the annual report of Shanghai Construction Engineering Group also said that the violations related to environmental issues have been rectified, and the above administrative penalties will not have a significant adverse impact on the company's production and operation. The company will strengthen daily environmental management and improve the interference of the construction site on the surrounding environment.
A single undisclosed work safety accident will be fined 990000 yuan
For construction enterprises, safety production and fire safety are more important than Mount Tai. What should be noted by investors is that in 2023, a fire accident occurred in a project contracted by Shanghai Construction Engineering Group and was fined nearly one million yuan, but the annual report did not disclose this information. According to incomplete statistics by reporters, in 2023, due to the failure to take measures to eliminate potential accidents, timely inspection and elimination of potential fire hazards, illegal subcontracting, construction not in accordance with the design drawings and other illegal acts, Shanghai Construction Engineering Group and its subordinate enterprises were punished by the housing construction, fire protection and other departments in 26 cases, with a total amount of nearly 1.5 million yuan.
According to an investigation report on the "4 · 11" general fire accident at the construction site of Xinhai Port GTC Project in Xiuying District, Haikou (referred to as the "4 · 11" investigation report) obtained by the reporter of Economic Information Daily, at 11:38 on April 11, 2023, a fire accident occurred at the construction site of Xinhai Port GTC Project near the intersection of Binhai Avenue and Tianxiang Road, Xiuying District, Haikou, The fire area was about 6100 square meters, without casualties, and the direct economic loss of the fire was 6.3609 million yuan. The project is a construction project invested by Haikou Municipal People's Government. The agent is Hainan Port and Channel Holding Co., Ltd., the general contractor of the project is Shanghai Construction Engineering Group, the supervisor is Shanghai Construction Engineering Supervision Consulting Co., Ltd., and the subcontractor responsible for the roofing project is Zhejiang Southeast Grid Structure Co., Ltd.
On October 27, 2023, Xiuying Branch of Haikou Comprehensive Administrative Law Enforcement Bureau of Hainan Province issued the "HZZ (Xiu) Penalty [2023] No. 4039" administrative penalty decision, which showed that the main responsibility of safety production of Shanghai Construction Engineering Group was not implemented, and the safety risk hierarchical management and control system was not established. Corresponding management and control measures were taken according to the safety risk classification to timely identify and eliminate accident potential; The unified coordination of safety production work of Zhejiang Southeast Grid Structure Co., Ltd., the professional subcontractor of roof engineering, is not in place; The construction site did not set up fire water sources as required, and equipped with necessary fire fighting facilities and fire-fighting equipment to meet the fire water supply requirements for fire fighting on the construction site. The law enforcement department determined that SCEGC had not organized effective fire fighting after the fire, which led to the spread of the fire and was responsible for the accident. Moreover, the fire occurred during the China International Consumer Goods Expo, which had a bad social impact. SCEG was fined 990000 yuan for violating the provisions of Article 4, Paragraph 1, and Article 41, Paragraph 1 and Paragraph 2 of the Production Safety Law of the People's Republic of China.
The "April 11" Investigation Report also suggested that Haikou Housing and Urban Rural Development Bureau should give the Hainan Branch of Shanghai Construction Engineering Group a record of bad behavior in production safety, and give its project manager Chen a fine of 75324 yuan, project safety director Lin a fine of 72747 yuan, and project safety officer Chen a fine of 40752 yuan.
Interestingly, two of the third batch of typical cases (8 in total) of violations of construction quality and safety in 2023 announced by the Department of Housing and Urban Rural Development of Hainan Province on December 18, 2023 are related to Shanghai Construction Engineering Group. Among them, Case 8 is the aforementioned "4 · 11" fire accident case; The first case is Haikou investigating and handling the case that Shanghai Construction Engineering Group did not purchase the safety production liability insurance in the construction industry as required. The specific case is that, on January 11, 2023, Haikou Construction Project Quality and Safety Supervision Station conducted construction safety production law enforcement inspection on the Volcano Green Corridor Reconstruction and Widening Project (South Section), and found that the project did not purchase construction industry safety production liability insurance as required, and Haikou Comprehensive Administrative Law Enforcement Bureau fined Shanghai Construction Engineering Group 75000 yuan.
In terms of safety production, SCEGC and its subsidiaries have repeatedly been subject to administrative penalties. For example, on October 9, 2023, the Construction and Transportation Bureau of Tianjin Binhai High tech Industrial Development Zone issued the JJZAJ20231002 Administrative Punishment Decision, which shows that Shanghai Construction Fifth Construction Group Co., Ltd. is suspected of committing "illegal acts of construction operations or use of equipment and facilities with potential safety hazards" during the construction of a project, Be subject to the administrative penalty of "order to stop work to eliminate hidden dangers and impose a fine of 40000 yuan". Coincidentally, on June 30, 2023, the Fifth Construction Group Co., Ltd. of Shanghai Construction Engineering Group was fined 10000 yuan for failing to take measures to eliminate potential accident hazards in a project. The law enforcement unit was Meilan Branch of Haikou Comprehensive Administrative Law Enforcement Bureau, Hainan Province, and the punishment document number was "(2023) Qiong Zongzhi (Haimei) Penalty Zi (Zhu) No. 00003".
On October 18, 2023, the Administrative Penalty Decision No. 2220230038 issued by the Construction and Management Committee of Changning District of Shanghai City showed that the Seventh Construction Group of Shanghai Construction Engineering Group Co., Ltd. was fined 49000 yuan for "failing to coordinate in time the safety problems of each construction unit in the process of construction handover or cross operation"; On December 18 of the same year, the Administrative Penalty Decision No. 2220230034 issued by Shanghai Jiading District Construction and Management Committee showed that Shanghai Construction First Construction Group Co., Ltd. was fined 20000 yuan for "failing to timely adjust and improve safety protection facilities according to the construction progress of the construction project".
The reporter of the Economic Information Daily also found that SCEG still had illegal behaviors such as failing to construct according to the design drawings and illegal subcontracting. On December 26, 2023, the Shanghai Municipal Commission of Housing and Urban Rural Development made the Administrative Penalty Decision No. 2120230222, which showed that Shanghai Construction Engineering Second Construction Group Co., Ltd. was subject to the administrative penalty of "order to correct and fine 11800 yuan" for illegal subcontracting in a project; On June 20, 2023, the "XZJXJJJXZZ [2023] No. 001" administrative punishment decision issued by the Housing and Urban Rural Development Bureau of Xinji City, Hebei Province shows that Shanghai Construction Seventh Construction Group Co., Ltd. violated the Regulations on the Quality Management of Construction Projects due to the "failure to construct the floor reinforcement project of the first floor of residential building No. 3 in Luzhou Community, Xinji City" The first paragraph of Article 28 stipulates that RMB 60300 will be fined.
In terms of fire control punishment, SCEGC and its subsidiaries will be punished at least 4 times in 2023. On March 15, 2023, the Shanghai Chongming District Fire Rescue Detachment issued the "HCXXXJZ [2023] No. 0028" administrative penalty decision, which showed that part of the indoor hydrant systems installed on a site of Shanghai Construction First Construction Group Co., Ltd. were damaged, and there was an illegal act of failing to maintain the integrity and effectiveness of the fire-fighting facilities, and 10000 yuan was fined; On May 6, the "JZXXXJZ [2023] No. 0045" administrative punishment decision issued by the Municipal Medium Brigade of Jining Fire Rescue Detachment in Shandong Province showed that Shanghai Construction Seventh Construction Group Co., Ltd. "failed to formulate a fire safety system in accordance with relevant regulations, publish and implement it, ensure that the behavior of its staff meets the post fire safety requirements, and failed to timely check and eliminate fire hazards", If the act of "illegally causing fire or causing expansion of fire losses" is constituted, 10000 yuan will be fined; On July 4, the "HJXXJZ [2023] No. 0191" administrative punishment decision issued by the Fire Rescue Detachment of Jiading District, Shanghai showed that Shanghai Seventh Construction Engineering Group Co., Ltd. was fined 15000 yuan for the illegal act of fire safety of "setting obstacles affecting escape and fire fighting rescue in doors and windows of crowded places"; On July 5, Shanghai Pudong New Area Fire Rescue Detachment issued the "HPXXXJZ [2023] No. 2056" administrative punishment decision, which showed that Shanghai Construction Engineering Group was fined 10000 yuan for failing to eliminate fire hazards in time due to the discovery of fire hazards on the construction site of Shanghai Metro Line 21 and failure to correct them within the time limit.
In addition, the reporter found that in 2023, a subsidiary of Shanghai Construction Engineering Group would be punished by "temporarily withholding the work safety license for 30 days" for no longer having the conditions for work safety; Shanghai Civil Defense Supervision and Management Center has given up to six warning punishments for violations of laws and regulations such as the construction of civil air defense works in violation of the national protection standards and quality standards.
In addition, on August 18, 2023, Xiuying Branch of Haikou Comprehensive Administrative Law Enforcement Bureau of Hainan Province issued two tickets to Shanghai Construction Engineering Group Co., Ltd., and the number of the administrative penalty decision is respectively HZZ (Xiu) XJ [2023] No. 7050 and 7051, with a total fine of 150000 yuan. Shanghai Construction Engineering Group Co., Ltd. has twice failed to purchase production safety liability insurance in accordance with national regulations; On November 17, 2023, the Administrative Penalty Decision No. 2120230139 issued by the Shanghai Municipal Commission of Housing and Urban Rural Development Management showed that SCEGC had committed the act of "failing to ensure the integrity and safety of construction machinery, machines and electrical equipment during the use of construction machinery, machines and electrical equipment, and special operators failing to receive special training on safe operation and obtain corresponding qualifications in accordance with the provisions to work", He was given an administrative penalty of "order to make corrections and a fine of 20000 yuan".
The reporter sent a letter to Shanghai Construction Engineering Group for interview on the above issues, but there was no reply by the time of press release. The Economic Information Daily will continue to pay attention to the punishment and other problems of SCEG.
