Anhui Conch Cement Co. (914), China’s biggest maker of the building material, said first-half profit fell by 2.3 percent as the recession cut demand, sparking decreased composite prices and narrower gross margins.
Net income dropped to 1.27 billion yuan ($186 million), or 0.72 yuan a share, from 1.30 billion yuan, or 0.82 yuan, a year earlier, the company said in a statement to the Hong Kong stock exchange, citing international accounting standards. Sales rose 10 percent to 11.2 billion yuan.
“The impact of the global financial crisis on China further intensified, resulting in a sharp fall in exports and a slowdown in the growth of domestic demand,” Chairman Guo Wensan said in the release.
A slowdown in new construction projects in China affected demand of cement and product prices. Anhui Conch Executive Director Guo Jingbin in April projected “stronger” demand for cement in the second half of the year, helped by increased stimulus spending on roads, ports and railways.
The cement maker’s shares have gained 35 percent this year, almost in line with the 39 percent gain in the city’s benchmark Hang Seng index. The stock fell 1.6 percent to HK$48.30 today in Hong Kong, before the earnings statement.
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