Comprehensive review: In the first three quarters of 2023, Conch Cement achieved an operating income of 99.043 billion yuan, a year-on-year increase of 16.07%, and a net profit attributable to the shareholders of the parent company of 8.672 billion yuan, a year-on-year decrease of 30.17%. In the third quarter, operating income was 33.607 billion yuan, an increase of 15.68% over the previous year, and net profit attributable to shareholders of the parent company was 2.204 billion yuan, a decrease of 14.55% over the previous year. Although the profit of Conch Cement still declined in the third quarter, the decline continued to narrow, the ability to absorb money was strong, and the leading position was still unshakable.
Figure 1 and 2: Conch Cement's Profit Decline Narrows in the First Three Quarters of 2023
Data Source: Cement Big Data (https://data.ccement.com/)
Revenue Continues to Increase Profit decline narrowed
in the first quarter of this year, the market demand recovered better, coupled with the development of trade business, the company's operating income increased by 23.18% year-on-year, but the cement price rose limited, superimposed on the high coal price, the company's profit returned to its parent company decreased by 48.2% year-on-year; After entering the second quarter, the peak season of the market was not prosperous, and the company's revenue growth slowed down, recording 10.57%, but thanks to the low base of the same period, the decline in profits returned to the mother narrowed; In the third quarter, the market was weaker in the off-season and the competition was fierce, but the company maintained its strength, continued to promote market-oriented business strategy, and its dominant position became more prominent. The growth rate of operating income rose to 15.68%, and the decline in profits continued to narrow to 14.55%. In the first three quarters, Conch Cement realized an operating income of 99.043 billion yuan, a year-on-year increase of 16.07%; however, due to the large drop in cement prices, the profit declined, and the net profit attributable to the shareholders of the parent company was 8.672 billion yuan, a year-on-year decrease of 30.17%.
Table 1: Main operating data
of Conch Cement in the first three quarters of 2023 Source: Cement Big Data (https://data.ccement.com/)
Although the focus of coal price in the first three quarters has dropped, the cost pressure has eased. However, the decline in cement prices is deeper, and the company's main profit indicators have declined to a certain extent. In the first three quarters of 2023, the gross profit rate was 18.33%, down 7.03 percentage points from the same period last year, and the decline in gross profit rate was also related to the company's expansion of trade business income. In addition, net interest rate and return on equity declined synchronously, recording 9.16% and 4.72% respectively in the first three quarters, down 5.79 and 2.1 percentage points respectively from the same period last year.
According to the three-fee data, the company's three-fee rate in the first half of the year was 6.11%, up 0.61 percentage points from the same period last year, mainly due to the increase in management costs. Since last year, the number of subsidiaries within the scope of consolidation of the company's financial statements has increased, and the management costs have increased synchronously. In the first three quarters of this year, the company's management costs were 4.527 billion yuan, an increase of 18.38% over the same period last year. High
absolute profit & strong
ability to absorb money According to the data of listed companies that have published three quarterly reports, Conch Cement stands out with a net profit of 8.672 billion yuan, which is far greater than total profit of other listed companies. In the downward period of the market, Conch Cement's excellent cost control ability, leading industry layout ability and strong market share ability make its leading position more consolidated.
Table 2: Net profit attributable to parent company of some companies in the first three quarters of 2023 (100 million yuan, 
Source: Cement Big Data (https://data.ccement.com/) (Note: CR Cement in HK $)
Profit outlook: Profit in the fourth quarter is expected to continue to improve
. Compared with the third quarter, the cement market demand will improve to a certain extent, while the cement price has a rebound momentum. In addition, the company actively lays out new energy, new materials and other industries, accelerates transformation and upgrading, and gradually releases new growth momentum. It is expected that the company's operating profit in the fourth quarter will improve significantly compared with the third quarter, the year-on-year decline will continue to narrow, and the annual profit level will be far ahead of its peers. (This article does not constitute investment advice)
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