Monday, March 1, 2021
Martin Hennecke
HKEx Stock Code : 01090 
Corporate Profile
Principally engaged in the processing, distribution and sale of stainless steel products.

Business Review - For the year ended December 31, 2012

2012 was another challenging year for the Group. The continual decline in the market price of the stainless steel materials adversely affected the results of the Group during the first half of 2012 and we reported a net loss of approximately RMB53 million in our interim report. In view of the unfavourable market condition, we have collaborated with major stainless steel manufacturers more closely to increase both our sales volume and processing volume in the second half of the year. With the stabilization of the market price of stainless steel materials in the third quarter of 2012, our results turned around and we were able to achieve a net profit for both the second half of 2012 as well as for the full year.

In spite of these unfavourable factors, the sales volume and the processing volume of the Group in 2012 had reached a record high of 702,890 tonnes and 975,784 tonnes respectively.

The annual sales volume of the Group increased from 590,174 tonnes in 2011 to 702,890 tonnes in 2012 representing an increase of approximately 19.1%. The total processing volume of our four processing centres increased from 784,413 tonnes to 975,784 tonnes in 2012 representing an increase of approximately 24.4%. Processing multiple increased from 1.33 in 2011 to 1.39 in 2012 which reflected an increase in demand for our advance processing services.

The Group has launched its welding processing service in its Wuxi processing centre during 2012. The welding processing service strengthens the Group's abilities in serving customers in the construction machineries, petrochemical and ship building industries. Together with the other processing services we provided, our Wuxi processing centre will be able to develop into a spare parts supplier for our manufacturing customers. The second phase of our Hangzhou processing centre was also completed in 2012 and more advance processing equipments will be installed in order to expand the overall processing capacities and capabilities. We saw a satisfactory growth in the processing volume in our Tianjin processing centre in 2012. In view of its special geographical location, the Group will expand the export business in our Tianjin processing centre. There had been strong demands of our stainless steel processing services in the Wuhan area in the past years. With an aim to consolidate the businesses of Hunan and Hubei provinces, a new processing centre will be built in Wuhan instead of in Changsha as initially planned. This new processing centre equipped with enhanced processing facilities will take over the businesses of our existing processing centre in Wuhan. The building infrastructure of our Taiyuan processing centre has been substantially completed and machineries installation has been started in the last quarter of 2012.

In November 2012, the Group has signed a strategic cooperation framework agreement with Baosteel Group, the largest steel corporation in the PRC, whereas Baosteel Group and our Group will join our efforts to explore new markets especially for the high-end users. We will provide advance processing services on stainless steel materials produced by Baosteel Group. Through this strategic cooperation, the Group is able to broaden its supply chain of stainless steel materials.

Business Outlook - For the year ended December 31, 2012

The anticipated growth in demand for stainless steel materials in 2013 will not be as rapid as previous years. However, the Group will benefit from the development of high end manufacturing industries in the PRC since we are able to provide advance stainless steel processing services to these high-end manufacturing customers as a consequence of our continual investment in modern processing equipments and improvement in processing techniques in recent years.

In addition to the stainless steel processing services, we shall extend our processing services to other metals especially carbon steel in 2013. We will also start the Jingjiang project which includes a large scale logistics complex in Jingjiang, Jiangsu province capable of providing processing services for both stainless steel and non-stainless steel metals.

Source: Da Ming Int'l (01090) Annual Results Announcement
Chairman Zhou Keming Issued Capital (shares) 1,038M
Par Value HKD 0.1 Market Capitalisation (HKD) 996M
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