Skip to main content

Anhui Conch Cement 1H15 results in line with Moody’s rating

Published by
World Cement,


Moody’s Investors Service has confirmed that Anhui Conch Cement Company Limited’s 1H15 results are in line with its A3 rating and stable outlook. The company reported a 15.8% decline in revenue in 1H15 to RMB24.2 billion, driven by a 16.44% decline in cement prices, attributed to slowing demand and oversupply.

"Conch's strengthened market position and maintenance of low debt leverage in 1H 2015 continue to support its A3 rating, despite the pressures from industry overcapacity and the slowdown in infrastructure and property developments," said Franco Leung, a Moody's Vice President and Senior Analyst.

Lower raw material costs and other cost reduction efforts could not offset the decrease in cement prices, which led to a decline in Conch’s gross margin to 27.2% in 1H15 from 33.2% in 1H14. However, Moody’s points out that this is still above industry average. Margin recovery will be limited, according to Moody’s expectations, but the likely removal of outdated production capacity will benefit leaders in the industry such as Conch.

Conch’s market share is estimated at about 11% in 1H15, up 1% from 1H14, and sales volumes were up 1.6% y/y in an environment in which national production volume fell 5.3% y/y.

"Despite the weakened level of earnings, Moody's expects debt leverage over the next 12 months to remain consistent with its standalone credit profile," says Jiming Zou, a Moody's Vice President and Senior Analyst, and Local Analyst for Conch.


Adapted from press release by

Read the article online at: https://www.worldcement.com/asia-pacific-rim/02092015/anhui-conch-cement-1h15-results-in-line-with-moody-rating-479/

You might also like

 

 WCT2021

WCT2021

At WCT2021 you will hear from a range of industry leaders and technical experts as they discuss the key challenges facing the cement industry and the latest solutions on offer. Register for free today »

 

CEMEX strengthens presence in Guatemala

The company has announced that, as part of its growth strategy, it will increase capacity in Guatemala with the construction of a new cement grinding mill that is expected to be completed in early 2023.

 
 

Embed article link: (copy the HTML code below):