Topic 1:

    Maximizing Efforts to Resume Production and Unblock the Upstream and Downstream Industrial Chains 

Just now, Mr. Zhu delivered a themed speech. I take this opportunity to also introduce China Building Materials Group to you all. 

    China Building Materials Group is a pilot enterprise for state-owned capital investment companies and the world's largest integrated building materials enterprise. As of December 31, 2019, the group's total assets exceeded 610 billion yuan, sales revenue exceeded 390 billion yuan, and profit attributable to equity holders exceeded 23.5 billion yuan, with 200,000 employees. Another feature is that China Building Materials is a global leading material developer and comprehensive service provider, with businesses covering the three combinations of basic building materials, new materials, and engineering technology services, and the most extensive industrial portfolio in the global building materials and materials industry. According to the 2019 statistics, China Building Materials Group has 44,000 suppliers and over 120,000 customers, with an annual coal consumption of 46 million tons and electricity consumption of about 35 billion kWh, and 7.5 billion cubic meters of natural gas. Overall, for a group like us, in the face of the COVID-19 epidemic, how to strike a balance between fighting the epidemic and resuming work and production is a high-difficulty task.

     At the quarterly economic operation analysis meeting of the State-owned Assets Supervision and Administration Commission (SASAC), the "three stable targets and four guarantee tasks plus one intensified effort" were put forward. China Building Materials Group strictly implemented and carried out the requirements of SASAC, truly acting as a leading enterprise in the building materials industry and making every effort to restore production and drive the upstream and downstream supply chains. In summary, we have carried out the following four aspects of work: 

First, the basic building materials sector is making every effort to resume production and achieve full capacity utilization. 

     So far, it has supplied the basic building materials for 58 key national transportation infrastructure projects and key national projects, including the main project of the Asian Games, as well as the Beijing-Shanghai High-Speed Railway, the Chengdu-Lanzhou High-Speed Railway, and key nuclear power and hydropower projects. At the same time, it uses the function of cement co-disposal to dispose of hazardous waste, household waste, and solid waste in 11 provinces across the country through 24 cement co-disposal production lines, with an annual disposal capacity of 2.42 million tons. During the epidemic period, it specifically coordinated the disposal of medical waste exceeding 60 tons.

Fourth, alleviate the cash flow shortage difficulties of small and medium-sized enterprises. 

     During the epidemic prevention and control period, we reduced or exempted rent for small and medium-sized enterprises and individual businesses who rented our buildings or workshops in the first quarter, with a total reduction or exemption of 18.77 million yuan. We expect a total reduction or deferment of more than 32 million yuan in the second quarter, and a total reduction or deferment of more than 32 million yuan for the whole year. 

     On the whole, we have taken concrete actions by leveraging our own industries and the smooth operation of the supply chains and value chains of leading enterprises to drive the smooth operation of the entire industry's supply chains and value chains.

Topic 2:

Transforming and upgrading supply chains and industrial chains 

    Let me share with you some insights into innovation and smart manufacturing, based on the case of China Building Materials Corporation. In fact, China Building Materials is a high-tech company with 38,000 technical personnel and 26 research institutes. To date, it has obtained 12,500 patents and won five first-prize awards for national science and technology progress. Innovation is the core competitiveness of China Building Materials. Innovation drives development, and it is also one of the company's important development strategies. I would like to share with you our practices in four aspects. 

   First, continuously upgrade the basic materials. 

   Basic building materials include cement and glass. What should we do next? China National Building Materials' cement plant design and manufacturing technology is the most advanced in the world, with a market share of over 80% in China's cement plant construction market. We should continuously upgrade the manufacturing level of basic building materials using China National Building Materials' advanced cement manufacturing technology and glass manufacturing technology.

Third, cooperative innovation, joint upgrade. 

     We work together with other partners to innovate and upgrade. We have cooperated with COMAC on civil aviation composite materials, with Sinopec on new materials and core equipment, and with the Three Gorges Group on the protection of the Yangtze River and the wind turbine blade industry.

Fourth, lay out new infrastructure and new business models. 

    In the area of new infrastructure, we have made breakthroughs in the technology of ultra-thin low-dielectric glass fiber used in the copper clad laminate (PCB board) for 5G mobile phone chips, and we have begun to implement it. We have also made breakthroughs in the technology of ceramic insulator pins used on our country's ultra-high voltage power grid, and this project was applied to several major projects of the State Grid during the anti-epidemic period in the first quarter. 

    On the whole, we not only lead the way with technology and innovation, but also more importantly, we can transform the results into industries and drive the entire industrial chain and supply chain upgrades from the industries.

Topic 3:

Maintaining the stability of international industrial and supply chains 

     China Building Materials Group is actually a company with relatively high internationalization level, a pioneer in going abroad, and a vanguard in participating in the construction of the Belt and Road Initiative. 

On the one hand, due to China Building Material's leading global engineering technology in cement and glass, it has a market share of over 65% in the global cement and glass engineering market today, and we have 279 engineering projects underway worldwide. 

     On the other hand, many new materials we produce are highly competitive domestically and have the highest market share globally, so our products naturally need to be sold all over the world. Not only do we sell products, in fact, our capital deployment also revolves around our customers. Therefore, we have capital investments and layouts in the United States, Germany, India, South Korea, and many African countries. Overall, we are stabilizing our engineering and supply chains, not only to stabilize the global industrial and supply chains, but also to provide support for the stability of our own income. 

     We have 30,000 employees overseas, of which 10,000 are Chinese nationals and 20,000 are foreign nationals. The epidemic has actually had a significant impact on our overseas factories and business operations, with more than 40 projects affected to varying degrees. In such circumstances, how can we maintain the stability of the global supply chain and industrial chain? We have mainly done two aspects of work.

     In addition to ensuring the overall supply of materials, we also guarantee imports. Because we have a lot of materials that need to be imported, we promptly formulated an epidemic prevention and control plan at the outset of the epidemic and increased the procurement of foreign sources of supply, changing the mode of transportation from sea transportation to railway transportation to ensure the import of large quantities of goods. For example, wood and OSB are imported by rail to ensure stable domestic market prices and the safety of the industrial chain. 

     Overall, China Building Materials has, during the pandemic, stabilized projects and supply chains, truly creating a global leadership role in stabilizing the industry supply chain and upgrading the industrial chain. 

A Sentence to Ponder 

     Thank you for giving China Building Materials this opportunity. In one word, that's my own experience. The future competition is the competition of innovation level. Innovation is a broad concept, not only technological innovation, but also management innovation, business model innovation, and institutional innovation. Only by innovation can we enhance the comprehensive competitiveness of our enterprise, only by innovation can we fulfill the tasks assigned by the State-owned Assets Supervision and Administration Commission (SASAC) and other shareholders, and only by innovation can China Building Materials become a world-class materials industry investment company. Thank you!