An investor asked Conch Cement on the interactive platform for investors: I would like to ask whether the coal in the cost of raw materials is coking coal or thermal coal. Because the company said that the gross profit was compressed in the second half of 2022 because of the rising price of coal, but the price of power coal was basically stable. On the other hand, if the trade business will affect the company's profits, why should we increase the trade business in the second half of 2022 and compress it after the mid-2023 report?
Conch Cement said on the interactive platform for investors on September 25 that the coal used in the company's production is thermal coal. In 2022, the overall price of thermal coal showed a trend of high before and low after. The annual average price rose year on year, maintaining a high overall level and increasing the cost of cement production. The main trading business carried out by the Company was profitable, but the overall gross profit margin was not high. Affected by the decline in cement market demand and the downturn in market conditions in the past two years, the Company optimized and adjusted the trading business structure, reducing the cement clinker trading business with relatively low gross profit margin. According to the semi-annual report of 2023 released
by Conch Cement recently, in the first half of 2023, the gross profit rate of 42.5 grade cement of Conch Cement decreased by 7.11 percentage points, the gross profit rate of 32.5 grade cement decreased by 2.84 percentage points, and the gross profit rate of clinker decreased by 13.86 percentage points; Among them, the gross profit rate of 42.5 grade cement, 32.5 grade cement and clinker decreased by 6.91 percentage points, 2.29 percentage points and 13.99 percentage points respectively.
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