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China Resources Cement reports 1H15 results

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World Cement,

China Resources Cement has reported its 1H15 results, which show a decrease in turnover of 11.6% to HK$13.4 billion. Commenting on the results, Mr Zhou Longshan, Chairman of the company, said: “In the first half of 2015, the Chinese government continued to adopt prudent monetary policy and proactive fiscal measures to maintain economic growth within a reasonable range. During the period, the Chinese government accelerated the approval of infrastructure projects and actively promoted the “public-private partnership” model, extensively covering industries including water facilities, municipal facilities, transportation facilities, public services and environmental resources, etc. In addition, the People’s Bank of China lowered the benchmark interest rates and deposit reserve requirement ratio for three times respectively in order to further reduce corporate financing costs and support the real economy development.”

China Resources Cement sold 34.8 million t of cement in 1H15 and 2.7 million t of clinker. This represents a decrease of 11.3% and 21.6%, respectively, over the previous year. Guangdong and Guangxi remain the group’s core markets, accounting for 41,1% and 28.1% of cement sales, respectively. Selling prices decreases about 16.4% over the period, while concrete prices increased 4.2% y/y, as a higher proportion of sales volume were from the Hong Kong market where prices are relatively higher.

Coal prices declined and the group adopted a low inventory procurement strategy whereby large-scale domestic coal suppliers are used for the most part, supplemented by imported coal. The group purchased 4.7% more coal during this period than it had in 1H14.

The group has continued to actively promote standardisation on production safety. Fourteen of its cement plants have been accredited the First-Class Enterprise in Production Safety Standardization by the State Administration of Work Safety in China. In addition, all the clinker production lines of the Group have completed technological upgrade on denitrogenation and their emission levels of nitrogen oxides are better than the national standards. As regards dust emission, in order to enhance the stability and efficiency of dust collection, the group has completed the technological upgrade of dust collection systems by replacing static electricity dust collection systems with bag filter systems. As of 30 June 2015, 30 clinker production lines of the Group were equipped with bag filter systems. The remaining 11 clinker production lines are expected to complete technological upgrade by the end of 2016. Currently, the emission levels of particulate matters for all production plants are in compliance with the national standard. The group is at a leading position in the industry.

The Group will proactively promote green development, continue to explore and promote the technology of co-processing urban waste, sludge and hazardous waste by using cement kilns. The urban waste co-processing project in the Group’s cement plant at Binyang County, Guangxi, which will be the Group’s first urban waste co-processing project in operation, is expected to start operation by the end of 2015. The Group’s efforts in environmental protection have been recognised by the industry and the general public.

Mr. Zhou concluded, “2015 is the year for devising the strategies and layout of the “Thirteenth Five-Year” plan. The Chinese economic development has entered the new norm. We believe that the Chinese government will maintain the continuity and stability of macro-economic policies to keep a reasonable economic growth.”

China Resources Cement has a total capacity of 78.3 million t of cement and 54.8 million t of clinker, as well as additional capacity from associate companies and JVs.

Adapted from press release by

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