1. The Jingjiang factory area began operation
Daming International's Jingjiang plant has been partially put into operation since last month. The Jingjiang plant is located on the northern bank of the lower reaches of the Yangtze River in Jiangsu Province. The factory area covers a total area of 1,100 acres on the Yangtze River. Of these, a terminal will be built for use by Daming International. The terminal is expected to have an annual throughput of 4.25 million tons, and the majority shareholders of the terminal are not owned by listed companies. Products from the Jingjiang factory area can later be shipped directly to customers through this terminal, with convenient waterway transportation. At present, two companies under Daming International have put into production in the Jingjiang plant area, namely Daming Heavy Industries and Daming Metal Technology. Daming Metal Technology is positioned for the initial processing of steel, and will join metal research and development in the future. Daming Heavy Industries is positioned as a deep steel processing platform, a comprehensive machining service platform and welding platform, with a variety of imported high-precision equipment. 2. Production capacity of stainless steel and carbon steel
The company now has 8 processing centers and 2 manufacturing plants, distributed in various major manufacturing towns across the country. The Jingjiang Processing Center was partially put into operation in December last year. In addition, as of the middle of last year, Daming International's total stainless steel and carbon steel processing volume was 2,093 million tons and 612,000 tons, up 16.8% and 17.2% over the previous year.
3. Good performance in 2015
The company's processing volume increased, but the decline in net profit was mainly affected by the sharp drop in stainless steel and carbon steel prices. Stainless steel prices fell by an average of 30% in 2015, which had an impact on the company's performance and is expected to shift from profit to loss. The company has nearly 120,000 tons of steel in stock to process daily orders. This portion of the fair value loss contributed to the decline in performance in 2015.
4. Daming has a steel inventory of about 120,000 tons
Daming is a steel trading company transformed from a steel trading company into a steel processing enterprise. The steel trade business is still preserved, and the steel trade business basically does not take up inventory. However, while the company's processing business continues to operate, it is necessary to have inventory to ensure normal daily processing and production.
5. Contract processing business
The company benefits from high-precision processing technology and equipment. Some high-end orders received by some companies in the industry will be processed by Daming. There is no need to consider inventory costs in this area of business, and profit margins are also very impressive. And now these kinds of orders are growing at an accelerated pace. The company will increase its share of this type of business in the future.
6. Future planning and prospects
The company expects to add the Industry 4.0 concept. Through standardized processes, customers will place orders directly on Daming's industrial line through ERP. Most standardized processes can be priced directly through standard pricing, and the rest of the complex processes are priced through technical personnel from both parties. After the customer accepts the price payment, Daming's production line produces directly, and then the logistics company transports it. Lower intermediate costs.
The company has increased cooperation with upstream steel companies, and Daming can open warehouses for free trial by steel companies. Sales personnel from steel companies can also enter directly and sell through steel trade channels in Daming. A steel company has signed an agreement with the company. For steel companies, storage costs can be reduced. For Daming, it can reduce inventory and reduce the risk of steel prices falling.