Results Highlights:
● The Group’s operation and production have fully resumed since the second quarter of 2020 and achieved growth in the revenue of leased aluminium alloy formwork
● Collaborated with new energy vehicle brands and successfully launched the first all-aluminium electric SUV in China
● Supplied to well-known domestic automobile manufacturers and became the Tier-1 automotive plates supplier for the world’s leading new energy vehicle brands and European luxury automobile manufacturers
● Continued to tap the demand for light-weight development of China’s transportation industry and to supply aluminium extruded profiles for “Fuxing EMU” high-speed trains
(Hong Kong, 26 March 2021) - China Zhongwang Holdings Limited ("China Zhongwang" or the "Company", together with its subsidiaries the "Group"; stock code: 01333), a world-leading fabricated aluminium products developer and manufacturer, announced its audited results for the year ended 31 December 2020 ("the Year under Review"). During the Year under Review, the Group recorded a sales volume of approximately 770,000 tonnes. Revenue amounted to approximately RMB20.4 billion. Gross profit margin stood at 29.1%. Net profit for the year was approximately RMB1.84 billion.
Mr. Lu Changqing, Chairman and President of China Zhongwang, said, “With China’s vigorous implementation of the ’new infrastructure’ strategy, China Zhongwang has achieved consecutive breakthroughs in the fields related to the ‘new infrastructure’, with the comprehensive supporting advantages and the existing advanced equipment and expertise. Meanwhile, the Group has also constantly strengthened its R&D in eco-friendly construction, so as to explore the market potential of the aluminium alloy formwork in order to enhance the leading position of the Group in the market. The Group will collaborate with both domestic and international cars manufacturers in various light-weight new energy vehicles development projects, in order to seize the market opportunities. The Group will also commit to integrating advanced technology to further enhance the overall competitiveness of its products.”
Aluminium Extrusion Business – Key Business Grew Amidst Downturn Seized Opportunities to Maintain Leading Edge
During the Year under Review, the sales volume and the sales revenue of the Group’s aluminium extruded business recorded a year-on-year decrease, which was primarily due to the impact of the COVID-19 pandemic on the domestic economy that affected the Group’s procurement, production, and sales to a certain extent. With significant progress achieved on the containment of the outbreak in China and the Group’s perseverance in the resumption of its operation and production, the Group’s production and sales have fully resumed since the second quarter and achieved growth for the year. During the Year under Review, the Group’s revenue of leased aluminium alloy formwork amounted to approximately RMB810
million, representing an increase of 15.7% from 2019.
In tandem with the “new infrastructure” development initiative, the Group has developed high-end innovative aluminium products which can be applied to the construction of 5G base stations, intercity high-speed railways, urban rail transit, and the field of UHV power transmission to capitalise on market opportunities and demand, so as to further enhance the Group’s market competitiveness. During the Year under Review, the Group has also successfully produced the world’s largest aluminium extruded products, filling the market gap for the domestic super-large aluminium extruded products.
Aluminium Flat Rolling Business – Optimised Production Applications through Innovative R&D Strengthened Collaboration with International Automakers & Gained Certifications
During the Year under Review, the production and sales of the Group’s aluminium flat rolled products in the first quarter were affected by the COVID-19 pandemic to a certain extent. Although the Group’s performance has gradually stabilised since the second quarter, the pandemic has cast a shadow on the sales for the year, resulting in a decrease in revenue and sales volume of the aluminium flat rolling business.
In terms of R&D, the Group has developed innovative corrosion resistant aluminium sheets, which not only can satisfy the demand for the rapidly growing market of integrated circuit specialised equipment in China, but also may hopefully break the monopoly of foreign players. Meanwhile, the Group has also further optimised production facilities, greatly improving its production efficiency and product quality while effectively reducing production costs. In addition, the Group continued to increase the high added value of aluminium rolled products, which have been widely used in various sectors including industrial materials, aviation and aerospace, shipbuilding, rail transit, new energy vehicles, and semiconductors.
Looking ahead, the Group will further expand the application of high-end aluminium rolled products into more sectors.
In terms of automotive body sheets, the Group has stayed committed to strengthening the in-depth cooperation with automotive manufacturers at home and abroad. The Group has supplied its products to well-known domestic automobile OEMs as well as the world’s leading new energy vehicle brands. Notably, the Group has become the only aluminium sheet supplier to Chery New Energy Automobile and the Tier-1 automotive plates supplier for an European luxury automobile brand, demonstrating the Group’s influence in the global automotive market. During the Year under Review, the Group continued to push forward the certification with international Tier-1 automobile manufacturers for its automotive plates, and achieved remarkable results.
During the Year under Review, Tianjin Zhongwang, the production base of the Group’s aluminium flat rolling business, was also widely recognised in terms of product development and market expansion. In addition to the title of the national “Green Factory” and the recognition of the Hebei Provincial Science Progress Award, Tianjin Zhongwang has also successively received various honorary titles including the “Tianjin High-end Aluminium Alloy Sheet Engineering Research Centre” and the first place of the “Top 100 Private Enterprises in Strategic Emerging Industries in Tianjin”.
Further Fabrication Business – Pioneer in Light-weight Development Fostered New Energy Vehicle Market
During the Year under Review, the sales volume and the sales amount of the Group’s further fabricated products recorded year-on-year growth. In terms of new energy vehicles, the Group has persistently developed in-depth cooperation with automobile manufacturers, so as to maintain a leading market share in the domestic market of aluminium alloy body for new energy vehicles.
After becoming a supplier of high-end aluminium extruded products to the BMW Group at the beginning of the year, the Group has also become the Tier-1 supplier to a world-leading new energy vehicle brand. Meanwhile, the Group has continued to consolidate its partnerships with well-known domestic automobile manufacturers including Chery, BYD and FAW. Specifically, following the Group’s successful collaboration with Chery New Energy on the launch of the first all-aluminium body automobile in China, the two parties jointly developed S61, the first all-aluminium electric SUV in China during the year, demonstrating the Group’s comprehensive strength in the new energy vehicle all-aluminium body market.
In addition, the Group has also provided light-weight solutions for Aumark, a model under Foton’s high-end brand Auhawk, and received full recognition from the company with the “Innovation Driven Award”. Moreover, the Group has received the “Most Promising Automotive Material Application Award for 2020” for its contribution in the R&D of aluminium alloy materials and their innovative applications in the automotive field.
In terms of the rail transit sector, the Group continued its in-depth cooperation with CRRC to constantly tap the market demand for light-weight development of the transportation sector in China and launch high-end aluminium products which can be applied to the rail transit sector. During the Year under Review, the Group has not only continued to supply aluminium extruded profiles for “Fuxing EMU” high-speed trains, but has also served as a supplier to the blue “Fuxing EMU” high-speed train with a speed of 250 km/h, thereby maintaining its market position as the largest supplier of “Fuxing EMU” train body aluminium extruded profiles. Meanwhile, the Group has successively supplied all train body aluminium extruded profiles and some further fabricated products for a number of urban rail transit projects such as Xiamen Metro, Hefei Metro, and Shanghai Metro. In addition, the Group has become the exclusive supplier of aluminium train body extruded profiles for Qingyuan Maglev as well as for a commercial maglev train in China (Changsha Maglev Express Line), from version 1.0 (travelling at 100 km/h) to version 2.0 (travelling at 160 km/h).
The Group’s overseas rail transit business has likewise achieved major breakthroughs. It has not only carried out cooperation with a world-renowned transportation equipment manufacturer, but has also exclusively supplied all train body aluminium extruded profiles for Monterrey Light Rail Project, China’s first light rail train exported to Mexico.
Looking ahead, Mr. Lu Changqing said, “Last year was filled with challenges. As a global leader in the aluminium processing industry, the Group will continue to assume its responsibility and duty, fulfilling the key function of scientific and technological innovation to develop foundation parts, foundation technology, and key base material, in an effort to support national foundation reengineering projects. The Group will strive to achieve the long-term development of the Company and drive the industry forward. Last but not least, we would like to extend our appreciation to all the colleagues for their dedication and contribution. In the new year, the Group will ride on and maintain its cooperation with global partners to achieve mutual benefits.”
