Research Express | Taipa Group (002233) Accepts Research Visits from Over 30 Institutions Including Guotai Kaiyuan; 2025 Net Profit Increases 17.87%, Dividend Payout Ratio Reaches 89%

Basic Information on Investor Relations Activities

On March 19, 2026, Guangdong Tapai Group Co., Ltd. (hereinafter referred to as “Tapai Group”) held a teleconference to accept institutional research. The research was hosted by Guotai Haitong Securities Co., Ltd., co-organized by CITIC Securities Co., Ltd. and Shenwan Hongyuan Securities Co., Ltd., attracting over 30 institutions including Shanghai Shangya Investment, China Post Securities, Sunshine Asset Management, Qianhai Open Source Fund, Ping An Fund, and Fortis Fund. The company’s secretary and relevant personnel attended the meeting to engage in in-depth discussions with institutional investors on topics such as 2025 annual report performance, industry trends, operational strategies, and future plans.

Analysis of Core Data from 2025 Annual Report

Industry and Company Performance Overview

In 2025, the cement industry faced a severe situation of “decreased volume, weak prices, and pressure on profitability.” National cement production totaled 1.693 billion tons, down 6.9% year-on-year, hitting a new low since 2010; industry profit totaled approximately 29 billion yuan, remaining at a relatively low level. Cement consumption in Guangdong Province was 131 million tons, down 5.98% year-on-year.

Against this backdrop, Tapai Group achieved countercyclical growth through operational optimization: cement sales for the year reached 16.0402 million tons, up 1.14% year-on-year; “cement + clinker” sales increased by 0.91% year-on-year. Operating revenue was 4.107 billion yuan, down 3.99%; net profit attributable to shareholders of the listed company was 634 million yuan, up 17.87%.

Cost and Profitability Performance

The company improved profitability through cost reduction and efficiency enhancement. In 2025, the average sales cost of cement was 173 yuan/ton, down 8.28% year-on-year; the average sales price was 228 yuan/ton, down 4.25%; the unit gross profit was 54.69 yuan/ton, up 5.5 yuan/ton year-on-year, with the overall gross profit margin increasing by 2.37 percentage points. The larger decline in costs compared to prices became the core driver of profit growth.

Environmental Protection Business and Dividend Plan

In environmental protection, the company’s solid waste disposal volume was 366,200 tons, a significant increase of 57.57% year-on-year; environmental disposal revenue reached 127 million yuan, up 13.01%, with revenue growth lagging behind disposal volume mainly due to falling disposal prices.

Regarding dividends, the company plans to distribute a cash dividend of 4.80 yuan per 10 shares (tax included), with a payout ratio of 89%, far exceeding the commitment in the “Three-Year Shareholder Return Plan (2024-2026)” of “not less than 70% of net profit for the year,” responding to investor concerns with a high payout ratio.

Focus of Institutional Attention and Company Responses

Q1: What is the demand for cement and the resumption of construction in 2026?

The company believes that cement demand will continue to decline in 2026, with an estimated decrease of 5%-8% for the year. Regarding construction resumption, sales before the Spring Festival were better than the same period last year, but recovery after the festival was weaker, mainly due to sluggish real estate demand and adjustments to VAT policies on concrete (from January 2026, general taxpayers cannot choose simplified tax calculation methods for self-produced cement and concrete, intensifying competition between batching plants and downstream). Infrastructure demand is relatively good, with local government bond issuance progressing better than last year.

Q2: How does the company plan to maintain regional market prices?

75% of the company’s capacity is concentrated in eastern Guangdong (Shantou, Chaozhou, etc.), where market share is high and prices are relatively stable; the remaining 25% is in the Pearl River Delta (Huizhou, Dongguan, etc.), where price increases in Q4 last year were implemented later. Currently, prices in the Pearl River Delta have softened, while prices in eastern Guangdong remain stable. Future price stabilization and recovery depend on demand recovery.

Q3: Is the future dividend plan sustainable?

The company stated that the “Three-Year Shareholder Return Plan (2024-2026)” will expire this year. Given the current operating situation and relatively low capital expenditure pressure, it is expected that similar attractive dividend plans will be launched in the future. The company’s annual depreciation and amortization are about 500 million yuan, and combined with net profit-generated operating cash flow, sufficient to cover capital expenditures and dividends. With ample existing cash reserves, dividend sustainability is assured.

Q4: What are the operational strategies and cost reduction space for 2026?

Sales volume target: 16 million tons for “cement + clinker” in 2026, a decrease of about 3-4% from 16.74 million tons in 2025, aiming for a smaller decline than the industry average. The operational strategy emphasizes balanced focus on volume and price, with increased efforts in bidding for infrastructure projects.

Cost reduction opportunities mainly come from five areas: expanding photovoltaic power generation (installed capacity at the end of 2025 was 51.50 MW), substituting fuels to reduce coal consumption (targeting 30% coal substitution), reducing raw material costs through solid waste disposal, improving efficiency via intelligent transformation, and optimizing capacity layout (integrating XinDa rotary kiln 5,000t/d capacity into JiaoLing branch’s 10,000-ton line).

Q5: What is the core reason for the 17.87% net profit growth?

Mainly due to three factors: first, countercyclical sales growth, aided by the low base from the 2024 “Flood 616” disaster; second, cost reduction (8.28%) exceeding price decline (4.25%), leading to increased unit gross profit; third, the rebound in capital markets boosting investment income (including unrealized gains). Although there was pressure from asset impairment of XinDa rotary kiln production line and employee benefits provisions at year-end affecting Q4 profits, the overall annual performance still achieved good growth.

Industry Outlook and Strategic Planning

The company believes that implementing control over excess production of cement lines will effectively constrain supply and ease supply-demand tensions. In 2026, cement prices in the Pearl River Delta have already fallen about 40 yuan/ton, and in eastern Guangdong about 10 yuan/ton; future price trends will depend on demand recovery. Regarding the exploration of new growth curves, the company is focusing on new energy sectors (photovoltaics, energy storage, pumped storage, etc.), leveraging the energy consumption characteristics of cement enterprises to explore virtual power plants and new energy storage opportunities on the user side. The company explicitly states that these explorations will not affect shareholder dividend returns.

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