CHAIRMAN’S STATEMENT


Dear Shareholders,

On behalf of the board of directors (the “Board”), I am pleased to present to you the annual results of the Company for the twelve months ended 31 December 2018 (the “Reporting Period”), and the operating results of the Company during the said period for your review.

Review

In 2018, faced with a complex and ever-changing external environment and the heavy tasks of reform and development, BBMG adhered to the general work principle of seeking progress while maintaining stability, upheld the new development philosophy, and made constant efforts in improving the operation quality and economic benefits to achieve significant growth in main economic indicators. During the year, the Company successfully participated in the mixedownership reform of Tianjin Building Materials Group (Holding) Co., Ltd. and obtained its controlling interests, thereby achieving synergetic development of the building material business in the Beijing, Tianjin and Hebei and reinforcing strategic resource reserve required for development. The asset restructuring plan of BBMG and Tangshan Jidong Cement Co., Ltd. was unconditionally approved by China Securities Regulatory Commission, which further clarified the internal property rights and management relations, providing a solid foundation for the high-quality development of the Company and the cement business. Pursuing the strategy of “highlighting principal businesses and strengthening specialized businesses” and based on the principle of “flat, professional, regional and digital” management, the Group has established a system where responsibilities and powers are more unified to further increase management and control efficiency. During the Reporting Period, the operating revenue was RMB83,116.7 million on a cumulative basis, representing a year-on-year increase of 30.5%; net profit attributable to the shareholders of the parent company amounted to RMB3,260.4 million, representing a year-on-year increase of 14.9%; basic earnings per share attributable to the shareholders of the parent company amounted to RMB0.31, representing a year-on-year increase of 14.8%.

Prospects

The year 2019 marks the 70th anniversary of founding of the People’s Republic of China (“the PRC”). It is a critical year for comprehensively building a moderately prosperous society and achieving the first Centenary Goal, and the 10th anniversary of BBMG’s listing. In the coming year, the global economy will continue to experience risks and uncertainties. The PRC’s economy will experience alarming changes in an otherwise stable economic environment and face considerable downward pressure. However, the generally stable and positive momentum will not change fundamentally. The economy is in and will remain in an important period of strategic opportunities for a long time. The Company will continue to make core basic industries stronger, better and larger to ensure that the Company as a whole develops in a high-quality manner. In respect of the cement and ready-mixed concrete segment, the Company will seize the rare strategic opportunities in the industry and the growth in profitability of the Company to accelerate the absorption of the consolidating and restructuring benefits, fulfill the requirements for the management and control reform of the Company, and make intensified efforts to carry out essential work based on our strategic position of “building a world-class cement industry group which is modern, professional and large in scale”, so as to comprehensively enhance operation management and control and continuously strengthen our core competitiveness. Meanwhile, giving full play to the guiding and exemplary effect of our role as the “leading company” in the industry, the Company will take the initiative to set industry rules and the market order, thereby continuously strengthening our industry influence and control over the market to drive the high-quality development of the industry as a whole. In respect of the modern building materials and commerce and logistics segment, the Company will enhance its core businesses and promote technological innovation to provide highquality, green and energy-saving new building material products that are marketable and meet customers’ needs. We will leverage our technological advantages and manufacturing supply chain resources to create a product integration and combination system with unique characteristics, with an aim to explore a new model of holistic and industrialized development. In respect of the property development segment, the Company will further improve its abilities in policy research and prediction and in seizing opportunities, and will demonstrate strong capability, high efficiency, and high profitability in project development and operation. In addition to improving our marketoriented operation capabilities, we must integrate our resources in line with the local policies of the regions where the Group operates to achieve coordinated and synergetic development of the segment. As for the property investment and management segment, the Company will sort out existing resources and systematically plan the classification, disposal and use of resources. For advantageous resources that meet the development requirements of the capital, we will accelerate their transformation and upgrade to attract high-quality customers or high-end businesses. We will continue to improve the professional level of property management, implement differentiated management based on property types, and optimize the cost performance of property services, so as to form positive interaction with the property development segment.

Finally, on behalf of the Board, I would like to express my sincere gratitude to our shareholders for their long-standing support for the Company’s development, and thank the Board and the Supervisory Board for their diligence and all employees of the Company for their hard work. In the coming year, the Company will endeavor to give back to the shareholders and the society, and build a bright future with shareholders!

Jiang Deyi
Chairman of the Board
Beijing, the PRC
28 March 2019