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- Revenue Surged by 131.7% to HK$52,140.5 Million
- Net Profit Increased by 110.0% to HK$1,861.9 Million |
HONG KONG, Mar 28, 2012 - (ACN Newswire) - China Metal Recycling (Holdings) Limited ("CMR" or "the Group", SEHK: 773), China's largest scrap metal recycling company according to the China Association of Metal Scrap Utilisation, today announced its annual results for the year ended 31 December 2011.
Financial Highlights:
For the year ended 31 December
HK$ million 2011 2010 % Change
Revenue 52,140.5 22,508.2 +131.7%
Gross profit 2,083.3 1,235.4 +68.6%
Gross margin 4.0% 5.5% -1.5% pts
Profit attributable to
owners of the company 1,861.9 886.6 +110.0%
Basic earnings/share (HK$) 1.63 0.85 +91.8%
Dividend per share (HK cents) 32 16 +100%
Business Review
As a result of the continued high demand for metals and increased penetration of scrap metals in China during the year, together with the expansion of CMR's regional coverage and increased market share, the Group has once again achieved outstanding results following the growth momentum in recent years.
Mr. Jacky Chun, Chairman and CEO of CMR, said, "I'm glad to report another year of exceptional growth for CMR riding on a generally favorable market environment. With the tightening of credit in China resulting in further industry consolidation, the Group has been able to gain additional market share leveraging on its scale of operation, established financing platform and other competitive advantages."
Sales volume of ferrous metals for the year was approximately 1,850,000 tons, an increase of 18.0% yoy while sales volume of non-ferrous metals for the year was approximately 668,000 tons, an increase of 85.3% yoy. Other materials represent the sales of other raw materials to the Group's customers such as ores, scrap plastics, etc.
China's crude steel production during the year reached approximately 683 million tons, an increase of 8.9% yoy. China's copper cathode production during the year was approximately 5.5 million tons, an increase of 15.5% yoy. Mr. Chun commented, "The penetration of scrap metals consumption in China is still at a low level when compared with the figures in developed countries, we believe great potential exists in the market."
During the year, CMR's Eastern China operation has benefited from the expanding operations in Jiangyin city and Ningbo city. Revenue continued to grow and margins improved as compared to last year due to the ramp up of operation and increase in regional market share. Jiangyin port has been the regional logistic and distribution hub supporting the Group's recycling base in the Eastern China region and connecting its operations in other regions.
Business flow of CMR's Northern China operation also continued to increase. The joint venture with Tianjin Pipe (Group) Corporation and the 11 regional recyclers (the "Tianjin Joint Venture") has commenced operation. In addition, the Group formed a 55%-owned joint venture with Baotou Lijilong Trading Company Limited (together with its group companies "Lijilong Group") (the "Baotou JV") in February 2012. Leveraging off the rich natural resources in Inner Mongolia, Baotou City is one of the major heavy industrial cities in the Northern China region and also a city with great supply and demand of scrap metals. With a designed annual capacity of 250,000 tons, Lijilong Group is one of the leading metal recyclers in Baotou City. Lijilong Group has a long operating history in the region and has established a base of quality customers such as Baotou Iron and Steel Group Co. Ltd and Inner Mongolia North Heavy Industries Group Co. Ltd and an extensive suppliers' network. It also has a major vehicle dismantling licence. The Baotou JV has a 500,000 tons annual capacity. Both initiatives will greatly enhance the Group's bargaining and managing power in the Northern China region.
As for CMR's Southern China operation, business has been stable. The Zhongshan site expanded its collection coverage and contributed an additional capacity of 300,000 tons. On 15 March 2011, the Group entered into a non-binding memorandum of understanding with Guangdong Materials Group Corporation ("GDWZ") to set up a joint venture to engage in the recycling business in the Southern China region. The discussion is ongoing. The proposed co-operation would help the Group create an integrated metal recycling system that combines the recycling and dismantling of scrap metals, electrical appliances, motor vehicles, vessels and aircrafts.
For the Central China operation, the Wuhan site has been ramping up. The Group has been expanding its regional suppliers network to meet the demand from one of the major customers, Wuhan Iron and Steel (Group) Corporation.
Outlook
The Group's future development strategy is to further enhance its competitive advantages to:
1) Continue to strengthen strategic national network and product categories in order to establish an integrated metal recycling system that combines the recycling and dismantling of scrap metals, electrical appliances, motor vehicles and vessels, so as to fully support the State government's target of establishing a comprehensive recycling system under the 12th Five-Year Plan;
2) Develop a diversified sales and procurement network to enlarge market share;
3) Continue to invest in advanced machineries and environmental protection facilities to ensure operational efficiency and economies of scale; and
4) Increase investment in staff to enhance management quality and strengthen overall operational and business integration capability.
Mr. Chun concluded, "Our strategy of combining both organic and inorganic approaches of corporate development to maintain our relative first-mover advantage will continue to reinforce our leadership position in the metal recycling industry in China. Looking forward into 2012, though facing uncertainties in the macro-economic conditions globally, we are confident of continuing the volume growth momentum and is expected to achieve 20-30% growth in sales volume. With contributions from our multiple regional operations, we are confident of delivering more than spectacular returns to our shareholders."
Contact:
Strategic Financial Relations Limited
Cindy Lung
Tel: +852 2864 4867
cindy.lung@sprg.com.hk
Gladys Kong
Tel: +852 2864 4806
gladys.kong@sprg.com.hk
Jessica Siu
Tel: +852 2864 4847
jessica.siu@sprg.com.hk
Topic: Earnings
Source: China Metal Recycling Holdings Limited
Sectors: Metals & Mining, Daily Finance
https://www.acnnewswire.com
From the Asia Corporate News Network
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