HONG KONG, Aug. 25, 2014 /PRNewswire/ --
Financial Highlights (Unaudited)
For the six months ended 30 June 2014
Profit from Operations
Profit Attributable to Equity Shareholders of the Company
Basic Earnings per Share (RMB)
China Shanshui Cement Group Limited ("Shanshui Cement" or the "Group"; HKEx: 00691), the largest cement enterprise inShandong and Liaoning Provinces in China, announced its unaudited interim results for the six months ended30 June 2014.
During the reporting period, the Group's revenue reached RMB7,349 million. Gross profit wasRMB1,534 million. Profit from operations was RMB856 million. Profit attributable to equity shareholders of the Company wasRMB168 million. Basic earnings per share reachedRMB0.06. The Board did not recommend payment of an interim dividend.
Mr. Zhang Bin, Chairman and General Manager of Shanshui Cement, said, "Affecting by the slowdown inChina's economic growth, a decrease in the growth rate of fixed assets investment, especially declining growth of investment in real estate development, the demand of cement in the market weakened. The weak demand of cement as well as overcapacity brought a decline in product price and decrease of profitability in the entire industry. In particular the cement prices in North andNortheast China recorded a substantial drop which resulted in a significant decrease in profitability. Nevertheless, the Group speeded up the development of its core cement business as well as prepared for the in-depth expansion within the industrial product chain, improved and refined fundamental internal management, in order to enhance the quality of production and operation and maintain sustainable profitability."
During the period under review, the sales volume of cement of the Group increased year-on-year by 6.0% to 24.36 million tonnes, the sales volume of commercial clinker increased by 7.3% to 4.51 million tonnes, and the sales volume of concrete rose significantly by 69.5% to 1.64 million cubic meters. Sales volume of high grade cement was 16.07 million tonnes, representing a year-on-year increase of 9.8%, and sales volume of low grade cement decreased by 0.6% to 8.27 million tonnes.
The cement average unit selling price of our operating companies in Shandong Region wasRMB240.6 per tonne, representing a year-on-year decrease of 1.3%; that in the Northeast Region wasRMB246.9 per tonne, representing a year-on-year decline of 9.9%; that in the Shanxi Region wasRMB209.9 per tonne, representing a year-on-year decrease of 4.0%, and that in the Xinjiang Region wasRMB233.7 per tonne, representing a year-on-year increase of 2.2%. Our operating companies in the Shandong Region recorded sales revenue ofRMB5,113 million, accounting for 69.6% of the Group's total sales revenue. Our operating companies in the Northeast Region reported a sales revenue ofRMB1,691 million, accounting for 23.0% of the Group's total sales revenue. Our operating companies inShanxi and Xinjiang accounted for 5.0% and 2.4% of the Group's total sales revenue respectively. The commencement of operations for operating companies inShanxi and Xinjiang should make more contributions to the Group's sales revenue in the future.
During the review period, the Group added new cement production capacity of 3.40 million tonnes and new clinker production capacity of 1.02 million tonnes by completing and acquiring production lines. As at30 June 2014, the Group had a total production capacity of 97.60 million tonnes of cement, 46.37 million tonnes of clinker and 16.80 million cubic meters of concrete.
The Group continued to improve its cost control measures. During the period, the proportion of raw materials costs to revenue was 25.1%, an increase of 1.3 percentage points compared with the same period last year. The Group's average unit purchase price of coal decreased by 5.3% toRMB546.4/tonne compared with the same period last year. The proportion of coal costs to revenue was 20.7%. Output of residual heat power generation was 532 million KWH, thus reducing the cost of clinker byRMB205 million.
Mr. Zhang concluded, "In the second half of the year, the Chinese government has launched a series of measures to promote economic development with pertinence, including the acceleration of the construction of transportation infrastructure such as railways and roads, which will effectively boost the demand of cement. In the meantime, fixed assets investment in the entire society and investment in real estate development have obviously decreased year-on-year, thus the problem of overcapacity in the cement industry is unlikely to be solved in the short term. However, this is a good opportunity for large cement enterprises to lay solid foundations for their sustainable profitability in the future by capitalizing on their advantages on management, brand, market presence and scale. Shanshui Cement is addressing all of its difficulties systematically by taking effective measures. These measures include stabilizing prices and focusing on customer segmentation in order to increase market sales volume; strictly controlling the cost and implementing benchmark management to enhance competitiveness; performing regular assessment and adopting different policies to prevent operational risks; as well as adapting to the current situation, enhancing quality and efficiency, and optimizing its strategic layout, with an aim to strive for fruitful returns and earn the continued trust and support of our investors."
About China Shanshui Cement Group Limited
Shanshui Cement is the largest producer of cement in Shandong and Liaoning Provinces and one of the largest cement producers inChina. The Group operates production lines and cement grinding lines that adopt the most advanced suspension pre-heater dry process. The Group will continue to expand its business through acquisitions and construction of its production lines. As of30 June 2014, the Group's total production capacity of cement and clinker reached 97.60 million tonnes and 46.37 million tonnes respectively. Shanshui Cement is currently a constituent stock of the Hang Seng Composite Index Series, Hang Seng Composite MidCap Index Series and Properties & Construction Industry Index Series. Within the "Top 100 Hong Kong Selected Stocks" jointly organized byHong Kong financial media Finet Group and Chinese server provider Tencent's QQ.com, Shanshui Cement was selected as one of "Top 100 Hong Kong Listed Companies" and "Top 10 Enterprises for Net Profit Growth" in 2012, as well as one of "Top 10 Comprehensive Strength (Mid Cap)" in 2013. The inclusion of the Group in these indexes as well as accolades marked the capital markets' recognition of the Group's performance, including its positioning, business and financial strength, reaffirmed the Group's reputation and position in the international capital markets.
For more information, please visit www.shanshuigroup.com http://www.shanshuigroup.com/>.
SOURCE China Shanshui Cement Group Limited