Conch Cement to spend tens of billions of expansion

"This year we plan to spend billions more on technological transformation, mergers and acquisitions and energy saving and emission reduction."　　Yesterday, the National People's Congress, Conch Cement Chairman, general manager Guo Wenjing accepted the "First financial daily" reporter exclusive interview said. In "Eleven-Five" before, conch Cement has been a leading domestic cement industry. Although in the past 5 years, the company's steady, but the central Chinese building materials group relying on mergers and acquisitions suddenly exerting force, the status of the industry leader by the Chinese building materials "rob" away. This may be the reason why conch Cement decided to invest heavily in the expansion of the internal reasons. "Up to now, the expansion of conch cement still rely on new, no merger and reorganization."　　"Digital Cement network president Liu Zouyi told this newspaper. Capacity expansion "XV" period, conch cement by new model quickly occupied the "Yangtze River Delta" and "Pearl River Delta" two of the country's most important regional market, and become a regional leader, profitability has been ranked the top domestic industry.　　But in the face of the expansion of China Building materials group in the South, "Eleven-Five" period, conch cement on the one hand to strengthen the "Yangtze River Delta" and "Pearl River Delta" two areas of the power map, on the other hand to open up the third battlefield-western region, also rely on the new model. September 2009, the State Council has issued a "suppression of some of the industry overcapacity and repeat the development of the industry to guide the health of several views of the notice" (Guo (2009)38), the cement industry has also become one of the key remediation industry, the industry generally referred to as "38th text." The document points out that the construction of the cement project which has not been started before September 30, 2009 is suspended and a serious clean-up is carried out, and the project against the above principles is prohibited.　　Many of the new production lines of cement companies were halted. However, this does not affect the continued increase in conch cement production. Guo Wenjing told our correspondent, because last year construction production line has not fully released, conch cement production will increase more than 10% this year, the current production has reached 140 million tons. "This year, next year, building capacity will increase by about 10% per annum."　　"According to the reporter understand, the current conch cement companies have been all over the country nearly 20 provinces and cities, and in China building materials and other several central enterprises in recent years wantonly through the acquisition of mergers and acquisitions expansion of the cement map, after the construction of the main conch cement, also concerned about some mergers and acquisitions opportunities. Merger and acquisition in the past year or two, the cement industry has significantly accelerated mergers and acquisitions. including Sinoma international mergers and acquisitions of the Qilian Mountains, China building materials acquisition Jiande Three Lions cement, Jidong Cement acquisition St Qinling and so on.　　However, the cement industry is still a relatively decentralized state, concentration of less than 30%.　　In the face of China's building materials, Sinoma group, such as mainly through the acquisition of rapid development of enterprises, and the Government to control the new capacity-building policy requirements, conch cement has to adjust the expansion strategy before. "Of all the major cement producers in China, conch Cement has the lowest leverage ratio and the highest level of operating cash flow," he said.　　UBS analyst Mi-boat, from 2011 onwards, conch cement or increase the intensity of integration. Look in the dense leaf boat, because the government control new capacity construction, conch cement is likely to accelerate the pace of integration, since 2011 to maintain the level of capital expenditure of more than 10 billion yuan, the company's endogenous expansion should be significantly slowed down.　　However, due to the state restrictions on new cement production capacity, industry concentration has increased, and last year, the continuation of rationing policy led to high cement prices, so that the cost of industry mergers and acquisitions rapidly increased. Conch Cement on the acquisition of the attitude has been more cautious.　　Guo Wenjing to this reporter said, conch cement in the acquisition of mergers have their own standards, including the acquisition of the company's profitability, location advantages, mining resources, cultural integration, and in the focus of the region, the Midwest is the first choice. In addition, Guo Wenjing that China's infrastructure construction, security housing construction has a large number of cement demand, and after a few years ago the industry's backward capacity elimination, the current cement industry has entered a benign development track, basically completed the restructuring task, "so the cement industry in the next 3-5 years of the market we are optimistic."　　"Last year, cement prices rose by 13% per cent year-on-year, Guo Wenjing that prices would continue to rise this year." This January, Conch Cement has issued performance forecasts that benefit from the state investment in fixed assets, cement demand to maintain a certain growth; at the same time, in the National energy conservation and emission reduction policy, backward capacity elimination accelerated, cement market supply and demand improvement, product sales, selling prices are maintained growth trend, The net profit attributable to the shareholders of the listed companies is expected to rise by more than 50% in 2010, while in 2009 the company's earnings amounted to 3.544 billion yuan. Responsible Editor: NF058