Huaibei GreenGold Industry Investment (2450) H2 2023 earnings summary

Executive summary

• FY2023 revenue fell 28.7% YoY to RMB290.6m as weaker construction and property markets drove lower prices and sales volumes.

• Profit attributable to equity shareholders declined 44.4% to RMB37.5m; gross margin fell 5 percentage points to 43%.

Financial highlights

• Revenue was RMB290.622m vs RMB407.709m; gross profit was RMB124.312m vs RMB194.816m.

• Operating profit was RMB130.888m vs RMB211.064m; profit before tax was RMB67.988m vs RMB140.057m.

• Profit for the year was RMB57.924m vs RMB105.058m; attributable profit was RMB37.490m vs RMB67.410m.

• Basic and diluted EPS were RMB0.14 vs RMB0.34.

Outlook and guidance

• 2024 trial production is expected at the new plant; use of Phase I and II lines is planned to lift annual capacity from 3.5m to 4.5m tonnes, with a longer-term target of 8m tonnes by 2031.

• The 2024 outlook anticipates stronger aggregate demand from infrastructure projects in Huaibei and surrounding cities; planned supply of ready-mixed concrete, cement-stabilised and asphalt products is expected to increase by 150,000 tonnes.

• Plans include potential acquisitions of suitable physical properties and capital increases to expand assets, revenue and profitability, and optimize cash flow.