Securities code: Huaxin Cement Co.Ltd(600801) , 900933 securities abbreviation: Huaxin Cement Co.Ltd(600801) , Huaxin B-share Announcement No.: 2022023 Huaxin Cement Co.Ltd(600801)
Announcement on the reception of investor communication meeting
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Huaxin Cement Co.Ltd(600801) (hereinafter referred to as “the company”) held an investor communication meeting on March 15, 2022. The main information of the reception of the meeting is announced as follows:
1、 The convening of this communication meeting
Time: March 15, 2022
Form: teleconference
Participants: China International Capital Corporation Limited(601995) Research Department
Participants of the company: ye Jiaxing (vice president and Secretary of the board of directors)
2、 Main questions raised by analysts and the company’s replies
The company exchanged views on the main concerns of investors, as follows:
1. The company’s aggregate production capacity and capacity under construction are close to 270 million tons. How to plan the proportion of non cement business in the future
10 aggregate projects under construction, including Yangxin 100 million ton machine-made sand project, are expected to be completed and put into operation in this year and next. The company’s current revenue of cement business accounts for 70% +, and it is planned that the revenue of non cement business can reach 40% +.
2. Can large-scale projects such as Yangxin 100 million tons of manufactured sand be replicated in the future
Under the premise of the great protection of the Yangtze River, it is very difficult to meet and have the advantages of resources, location and market demand at the same time. Yangxin 100 million ton machine-made sand project is located in Fuchi Town, Yangxin County, Huangshi City, Hubei Province. It is about 2km away from the coastline of the Yangtze River. It can navigable ships of more than 5000 tons all year round. The supporting mineral rights of ore resources can reach 2 billion tons, and it is only 3km away from the coastline of the Yangtze River. It is the second heaviest mountain along the Yangtze River, with large resource reserves and excellent quality. Cities along the middle and lower reaches of the Yangtze River (Shanghai, Nanjing, Suzhou, Wuhan, etc.) are import markets with huge market demand.
The extra large project of Yangxin 100 million tons of machine-made sand is unique and difficult to replicate. The project is a provincial key project of Hubei Province in 2020 and supported by the Ministry of industry and information technology of the people’s Republic of China.
After the project is put into operation, it will significantly enhance the competitiveness of the company.
3. What measures does the company have in reducing power consumption and electricity price
After the notice on further deepening the market-oriented reform of on grid electricity price for coal-fired power generation came into effect by the national development and Reform Commission in 2021, different provinces in China began to implement different new electricity price policies.
In response to the rise of electricity price, the company has taken the following countermeasures:
(1) All base factories have chosen to purchase electricity from power generation enterprises to avoid excessive rise of electricity price caused by purchasing electricity from power grid companies;
(2) Lean production management, reduce power consumption, and obtain national “green factory” or “energy efficiency leader” certification as much as possible, so as to obtain the electricity price policy of non “high energy consuming enterprises”;
(3) Improve the waste heat power generation efficiency of various production lines, especially the urban waste collaborative disposal production line; Try to change electric drive to steam drive to reduce purchased power;
(4) Establish and strictly implement the time of use electricity price management system: production organizations “avoid peak and valley”, use enough low-cost valley electricity, and strictly control the use of peak electricity, so as to reduce the settlement electricity price;
(5) Invest in the development of green energy projects when the time is ripe, and reduce the purchased power consumption through wind power and photoelectric projects.
4. Means of reducing coal consumption
In 2022, the company will continue to increase the proportion of collaborative disposal of alternative fuels. The overall calorific value substitution rate of the company should reach more than 10%, and the factories with sufficient RDF and alternative fuels should reach more than 15% or even 20%. The comprehensive energy consumption of clinker in all cement plants must be less than 117kgce / T, of which the kiln line (including) below 2500t / D and RDF disposal core plants must be less than 100 kgce / T.
5. The advantages of overseas development after B to h, and the reasons why B-share shareholders see China’s new development
This time, the total number of shares that finally exercised the cash option accounted for 12.63% of the total number of B shares of the company. From our communication with investors, most B-share shareholders are optimistic about the fundamentals of the company and are willing to follow and support the conversion of B shares to H shares. In addition, the dividend rate of Huaxin B shares is very high, which is also the reason why shareholders insist on being optimistic. The company hopes to have an overseas capital platform, increase our capital operation efficiency and overseas popularity, and help the expansion of the company’s overseas projects.
6. Does the situation in Russia and Ukraine have an adverse impact on the company’s overseas factories
The company’s overseas production lines are located in Central Asia, Tajikistan, Kyrgyzstan, Uzbekistan, Southeast Asia, Nepal, Cambodia, East Africa, Zambia, Tanzania, Malawi and other places. The situation in Russia and Ukraine has little impact on the company’s overseas factories, the overseas operation is good, and there is no major fluctuation in production and sales.
3、 Risk tips
If the relevant contents of this communication meeting with investors involve the intentional objectives such as the company’s current development strategic planning, it cannot be regarded as the guarantee of the company or the management for the company’s development or performance. The company will timely perform the relevant information disclosure obligations according to the relevant requirements, and the majority of investors are invited to pay attention to the investment risks.
It is hereby announced.
Huaxin Cement Co.Ltd(600801) board of directors March 16, 2022
