Comprehensive review: In the first half of 2026, Western Cement achieved an operating income of 4.527 billion yuan, a year-on-year decrease of 16.45%; the net profit attributable to parent company was 379 million yuan, a year-on-year decrease of 49.38%. In the first half of the year, the domestic demand for cement continued to decline in depth, the volume and price of Shaanxi, the core market of western cement, fell, and the domestic business turned from profit to loss; the overseas business continued the trend of high growth, becoming the absolute pillar of the company's profit. The internationalization strategy has entered the harvest period, but due to the drag of domestic business, the company's profitability has dropped significantly.
Figure 1 and 2: Western Cement Revenue in the First Half of 2026, Profit trend
Data source: Cement big data (https://data.ccement.com/)
The domestic market is in a deep downturn, and the volume and price are weakening
simultaneously. The domestic production capacity of cement in the western region is concentrated in Shaanxi, and there is a small amount of layout in Guizhou and Sichuan. In the first half of this year, the demand for cement in China continued to decline, the demand for real estate and civil engineering in Shaanxi was low, and the bidding in the same industry was fierce. The domestic sales volume of cement and clinker of the company was 5.15 million tons, down 22.56% year-on-year; the average sales price was 224 yuan/ton, down 56 yuan/ton year-on-year, down 20%; the gross profit per ton was only 12 yuan/ton, down 81.25% year-on-year.
From the regional perspective, the sales volume of Shaanxi, the core market, was 4.696 million tons, with a year-on-year decrease of 15.1%; the selling price was 209 yuan/ton, with a year-on-year decrease of 19.9%; the gross profit per ton was 16 yuan/ton, which was significantly reduced from 64 yuan/ton in the same period last year. The market price in Guizhou is 414 yuan/ton, and the gross profit per ton is -43 yuan/ton, which is in a loss state. Affected by this, in the first half of the year, the domestic business realized an operating income of 1.549 billion yuan, a decrease of 50.56% over the same period last year; the domestic profit was -204 million yuan, turning from profit to loss. In addition, the sales volume of aggregate was 2.39 million tons, representing a year-on-year increase of 7.2%; the sales volume of commercial concrete was 570,000 m3, representing a year-on-year decrease of 9.5%, and the overall scale was relatively small.
Figure 3. 4: Decrease
in both volume and price of domestic cement products Source: Cement Big Data (https://data.ccement.com/)
Increase in both volume and price of overseas business Profit contribution continued to increase
Since the "14th Five-Year Plan", the Company has continued to accelerate its overseas layout. At present, it has formed a multi-regional collaborative layout in Ethiopia, Mozambique, Congo (Kinshasa), Uganda, Rwanda and Uzbekistan. In the first half of this year, the sales volume of cement and clinker in the overseas market was 5.39 million tons, with a year-on-year increase of 29.26%, accounting for 51.1% of the Group's total sales volume, surpassing the domestic market for the first time; the average sales price was 526 yuan/ton, with a year-on-year increase of 8.23%; the gross profit per ton was 222 yuan/ton, with a year-on-year increase of 22.65%.
Figures 5 and 6: Increase
in both volume and price of overseas cement products Source: Cement Big Data (https://data.ccement.com/)
From the perspective of regions, Uganda's 3 million tons of clinker production line was completed and put into operation in the first quarter of this year. In the first half of the year, it contributed 531,000 tons of sales volume, and the gross profit per ton was as high as 340 yuan/ton, the highest level in all regions. Relying on the capacity release of CILU Cement Plant in Kinshasa, the sales volume of Congo (DRC) increased by 39.0% and the gross profit per ton increased by 74.3%. Sales in Uzbekistan increased by 42.3%, and gross profit per ton nearly doubled. Affected by the shortage of local foreign exchange and the interruption of diesel supply in Ethiopia, the factory stopped production for a time, and the sales volume in the first half of the year was the same as that in the same period of last year; the competition in the Mozambique market intensified, and the volume, price and profit fell to a certain extent.
Table 1: Overseas operation information
of Western Cement in the first half of 2026 by country Source: Cement Big Data (https://data.ccement.com/)
Benefited from the increase in sales volume and the improvement in profitability, In the first half of the year, the overseas market realized an operating income of 3.029 billion yuan, an increase of 29.0% over the same period last year, accounting for 67% of the Group's total revenue, and realized a profit of 739 million yuan, an increase of 61.9% over the same period last year. Domestic business profit-200 million yuan, the first loss in recent years. However, overseas business profits completely cover domestic losses, which has become the absolute pillar of the company's performance.
Figure 7: Overseas in the first half of 2026 Trend of
profit in the domestic market Source: Cement Big Data (http://data.ccement.com/)
Rigid rise in expenses and decline
in profit indicators In the first half of 2026, the comprehensive gross profit rate of Western Cement was 31.02%. The year-on-year increase of 1 percentage point was mainly due to the increase in the proportion of overseas business with high gross profit. However, the rigidity of the expense side increased significantly, and the sales, management and financial expenses totaled 823 million yuan, with a rate of 18.18%, an increase of 4.1 percentage points over the same period last year, of which the management expenses were 435 million yuan, an increase of 22.9% over the same period last year, and the financial expenses were 290 million yuan, an increase of 16.9% over the same period last year. Affected by the loss of domestic business and the increase of expenses, the net profit of the company was 379 million yuan, down 49.38% from the same period last year.
Table 2: Main operating data
of Western Cement in the first half of 2026 Source: Cement Big Data (https://data.ccement.com/)
In terms of other indicators, the basic earnings per share of the company in the first half of 2026 was 0.07 yuan. The net profit margin was 12.3%, down by 4.2 percentage points, and the return on equity was 3.01%, down by 3 percentage points. Due to the impact of foreign currency exchange rate fluctuations, the foreign currency translation difference during the period was -333 million yuan, and the total comprehensive income decreased from 690 million yuan in the same period last year to 224 million yuan. The exchange rate risk of overseas assets needs continuous attention. Outlook for
the second half of the year: Continuous release of overseas production capacity and orderly exit
of domestic business Looking forward to the second half of the year, the overseas market will remain the core support for the Company's performance. Uganda's clinker production line has been put into operation in the first quarter of this year, and the production capacity will increase quarter by quarter. In addition, Zimbabwe and Angola's production lines are planned to be put into operation within this year. If they are completed and put into operation as scheduled, the company's market share in Africa is expected to further increase. In the domestic market, the company has clearly adopted a "subtraction" strategy, following the sale of assets in Xinjiang last year, and is currently negotiating with buyers on the divestiture of domestic assets. On the whole, domestic demand continues to be depressed, and the company's annual performance will remain under pressure, but the release of overseas capacity and the continuous improvement of profit contribution will provide an important performance buffer for the company. (This article does not constitute investment advice)
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