China Glass Announces 2022 Interim Results
Steady Development of Principal Business and Strong Growth of Overseas Business Scale

(August 30 2022-Hong Kong) The board of directors of China Glass Holdings Limited (“China Glass” or the “Company”, Stock Code: 3300.HK) is pleased to announce the unaudited consolidated interim results of the Company and its subsidiaries (collectively referred to as the “Group”) for the six months ended 30 June 2022 (the“Reporting Period”).

During the Reporting Period, the revenue of the Group from its principal business increased by approximately 2% to RMB 2,061,978,000 as compared to the corresponding period of 2021. The increase in revenue was mainly attributable to the combined effects of the increase in average unit selling price and the slight decrease in sales volume. The Group’s gross profit decreased by approximately 40% from RMB 714,699,000 for the corresponding period of 2021 to RMB 426,447,000 for the Reporting Period. The decrease in gross profit was mainly due to the combined effects of the slight increase in sales revenue and the significant increase in the cost of sales. The Group produced approximately 21.17 million weight cases of various types of glass products, representing an increase of 20% compared with the same period of 2021, with a consolidated average selling price of approximately RMB116.4 per weight case, representing an increase of 1% compared with the same period of 2021.

As of the announcement date, the Group currently has 14 float glass production lines, with a daily melting capacity of 7,400 tonnes. During the Reporting Period, the Group had 10 float glass production lines in operation. The unoperated production lines included a float glass production line in Kazakhstan in the preparation stage before production and 3 other float glass production lines which were in the cold repair stage. In addition, the Group also had 1 offline low- emission coated (“Low-E”) glass production line, a company specialized in engineering equipment and technical services for neutral pharmaceutical glass production lines and 1 photovoltaic glass production line in the preparation stage before production.

In the first half of 2022, in the face of the complex and ever-changing external environment, with the aim of improving its operating performance, the Group focused on the float glass business and deepened the implementation of its mid- and long-term development strategy integrating “organic growth, M&A growth and going global” (“three major strategies”). While conscientiously proceeding with the work of “cost reduction and efficiency enhancement”, the Group proactively promoted the construction progress of new glass, new materials and new energy projects (“three new projects”) and deepened the unified system management covering “production, marketing, procurement, finance and investment” (“five-in-one”). The efforts were mainly exerted in the following aspects:

Seizing market opportunities and adjusting procurement and marketing strategies in a timely manner

In terms of procurement management, the Group paid close attention to the economic environment and fluctuations in market conditions. Taking into account of the situation, the Group deeply explored strategic cooperation with high-quality suppliers through centralized purchasing, off-peak purchasing, opportunistic purchasing, advance purchasing, etc., to effectively reduce the purchasing costs of raw and fuel materials. Meanwhile, the Group ensured the stability of raw and fuel materials supply and production safety through overall planning, field survey, intelligent monitoring, dynamic management, etc. In respect of marketing management, the Group focused on strengthening management and control of the price and grasped the pace of market changes, to quickly adjust marketing strategies; the Group strengthened research and judgment to adjust product structure in a timely manner, to increase sales of high value-added specialty products and to fully meet market demand. Meanwhile, the Group balanced and coordinated customer channel relationships and promoted the improvement of customer resource quality through improving the dynamic customer contract management system, strengthening sales channel development,customer satisfaction surveys, and other measures.

Proactively responding to market changes, tapping potential internally, and vigorously carrying out “cost reduction and efficiency enhancement”

Every base of the Group proactively promoted the work of “cost reduction and efficiency enhancement” according to local conditions. In terms of production technology, the Group practically strengthened the management and control of the whole production process and reasonably adjusted the structure of raw and fuel materials on the basis of ensuring product quality and safe production, to effectively reduce the heat consumption of furnaces and comprehensive energy consumption; in respect of finance, in coordination with the headquarters and bases, the Group strengthened comprehensive budget management to effectively control costs. At the sametime, the Group proactively sought for low-cost and diversified financing channels to match high- quality capital resources for the rapid expansion of the Group’s businesses.

Adhering to technological innovation and steadily advancing the “three new projects”, striving for new breakthroughs in business development

In response to the national “double carbon” initiative and in accordance with the relevant national policies and measures for green and low-carbon development, the Group relied on internal and external technology development platforms to promote the unified and collaborative management of the Group's production technologies, to strengthen the technical differentiation of coated glass products and other featured products of CNG in the industry, to enhance the market competitiveness and promote the green development and sustainable development of the Company simultaneously.

The new Energy Business Department newly established at the headquarters of the Group coordinated and managed the “three new projects” of the Group. Looking at the national sustainable development policy and market conditions, it comprehensively developed new energy glass, meanwhile, effectively promoted the construction progress of projects under construction. A photovoltaic glass production line of the Group in Suqian Base was in the preparation stage before production, gradually forming the new energy industry layout in Suqian.

The “going global” strategy has achieved remarkable results, boosted performance growth and enhanced the ability of overall risk-resistance of the Company

The operating results of the overseas projects achieved outstanding performance. The profitability of the project in Nigeria was significantly ahead of standard of peers in mainland China; in the project in Italy, the business scale of borosilicate pharmaceutical glass and hollow glass equipment service segment grew strongly, and the new solar energy and its technology development segment developed gradually, which is expected to become a new economic growth driver in the future; the project in Kazakhstan will be ignited soon.

Being people-oriented and giving full play to the effectiveness of the incentive mechanism

The Group fully implemented the “people-oriented” humanistic concept. Through further improving the performance appraisal system, organizing skills training for employees, optimizing the configuration of the senior management team, and other measures, the Group continuously strengthened human resource management and gave full play to its positive and incentive role.

WORK PLANS FOR THE SECOND HALF OF 2022

1. The Group will continue to strengthen the management functions of departments and deepen “five in one” system management, and give full play to the synergy between the five systems and bases. The Group will proactively implement the management philosophies of “benchmarking management”, “streamlining organization, management and operation” and “differentiated operation”, strengthen the awareness of crisis, and effectively promote the work of “cost reduction and efficiency enhancement”.

2. The Group will proactively seize on the construction progress of “three new projects” and cold repair technical renovation projects, and contribute to new benefit drivers; focus on the construction progress and operation situation of overseas projects to further improve the benefit contribution of overseas projects.

3. The Group will further improve the salary increment mechanism and performance appraisal system and promote the formulation and implementation of equity-based incentive plan, to boost employees’ happiness; the Group will place importance on the construction of corporate culture, enhance the centripetal force and cohesion of employees; and intensify the introduction and training of talents to optimize the staff structure, and proceed to carry out the work of intelligent and digital transformation, to lay a solid foundation for the sustainable development and comprehensive transformation and development of the Company.

4. The Group will strength capital market management and promote the healthy development of the Company’s market value.

5. The Group will emphasize supervision and management of compliance to prevent and defuse operational risks of the Company.

MARKET OUTLOOK

In the second half of 2022, in light of the increased downward pressure on the world economy, the International Monetary Fund lowered the value of economic growth forecast by 0.4% to 3.2%. With the effective control of the domestic epidemic and the steady implementation of macro support policies, China’s economy is expected to reflect a steady recovery. In the second half of the year, the glass industry will enter the traditional peak season. Under the influence of the national “double carbon” initiative and relevant policies such as “guaranteeing the delivery of buildings and stabilizing people’s livelihood”, the market demand for construction and new energy glass is expected to rebound. In addition, as the supply-side cold repair is expected to reach the peak, the glass price may usher in a rebound. However, the frequent mutation of the COVID-19, the lack of fundamental relief of geopolitical conflicts, and the overall rise in commodity prices brought about by global inflation will still pose challenges to the development of the glass industry.

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About China Glass Holdings Limited
China Glass Holdings Limited is China’s leading float glass and the largest reflective glass manufacturer. The Group has 14 float glass production lines, with a daily melting capacity of 7,400 tonnes. Triumph Group, which is a wholly-owned subsidiary of China National Building Materials Group, is one of the main shareholders of the Company, focusing on the emerging high-tech manufacturing of new glass materials, and its technology research and development is leading in the industry. The strong shareholder background is a strong backing for the Company's steady development.

The Company complies with the national policy of low-carbon economy, energy conservation and emission reduction, comprehensively adjusts the product structure and implements the industrial upgrading strategy. The Company focuses on R&D, production and sales of a series of architectural coated glass and energy-saving, environmental-friendly and new energy glass, and occupies a high-end technology position in the domestic glass industry, it is the "Quality Float and Special Glass Business Platform" of Triumph Group.

This press release is issued by Wonderful Sky Financial Group Limited on behalf of China Glass Holdings Limited.

For further information, please contact:
Wonderful Sky Financial Group
Email:chinaglass@wsfg.hk

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