China cement producers upbeat on growth

China cement producers upbeat on growth
04 September 2008

Mainland cement companies are bullish about industry growth after reporting strong net profits for the first six months of the year.
China National Materials (Sinoma), the world’s largest cement engineering service provider, said net profit grew 75.5 per cent from a year earlier to CNY295.23m (HK$337.72m) on an increasing number of overseas projects and higher sales prices.
Revenue rose 26.76 per cent to CNY10.9bn. No interim dividend was recommended.
"We aim at becoming the largest cement enterprise in the north by completing the acquisition of Ningxia Building Materials and proceeding with the acquisition of Jidong Cement Group," said director Zhou Yuxian.
The company will have a total production capacity of 32Mt by year-end. After its acquisition of Jidong Cement Group, a large cement producer in the north, Sinoma’s total capacity will reach 72Mt.
"Besides the northern market, we’re also looking for investment opportunities in Qinghai and Gansu for enlarging production capacity," Mr Zhou said.
Sinoma mainly engages in four businesses - cement equipment and engineering services and production of glass fibre, cement and hi-tech products such as wind power generators.
Meanwhile, China Shanshui Cement Group, whose net profit grew 123.3 per cent in the first six months, expected cement demand to continue to grow in the second half due to the country’s growing fixed assets investment.
"We’ve already attained the target for the first half and we’ll stick to the yearly net profit target of CNY450m," said chairman Zhang Caikui.
Revenue jumped 87.83 per cent to CNY3.37bn.
The company said Shandong province had stopped production of about 7Mtof substandard cement by the end of June.
"The provincial government plans to eliminate a total of 53.44Mt of unqualified cement in from 2007 to 2010," said Mr Zhang. "That helps push up the price of cement."
Published under Cement News