China Boulder on April 7 released the investor relations activity record, the company on April 3, 2025 to accept 27 institutions research, the following are the key questions and answers:

Q: Glass fiber prices since the first quarter of 2024 has experienced multiple re-pricing, involving a number of varieties of yarn, how to view the sustainability of this round of re-pricing? The main driving force of repricing is the further recovery of demand, or the improvement brought about by rational competition and the pursuit of profit?

A: With the economic recovery, the downstream industry demand is gradually released, the early glass fiber industry has achieved phased results. Recovery power from the initial industry recovery, corporate profit repair demand gradually shifted to demand recovery support, the price center is expected to continue to rise steadily. In order to maintain a good industry supply and demand pattern, there is a consensus among enterprises in the whole industry for the stable price of glass fiber products, and the specific product price trend will ultimately depend on multiple factors such as downstream demand and industry supply.

Q: The company continues to deploy intelligent manufacturing production, and Huaian has also laid out supporting wind power generation to achieve a zero-carbon base. Where are the cost savings and efficiency improvements in the intelligent manufacturing base compared to the traditional production line?

A: The intelligent manufacturing base emphasizes the comprehensive application of integrated innovation. Compared with the traditional production line, the advantages are mainly reflected in the efficiency improvement and intelligent level, and the cost savings are mainly reflected in: the production line opening probability, finished product rate, and excellent product rate are improved compared with the traditional production line; Compared with traditional production lines with the same production capacity, the number of workers decreased further, and the per capita production efficiency increased; In addition, there is a reduction in the consumption of production operations such as furnaces, channels, and leakage plates.

Q: What are the technical advantages of the company in the current market environment and how is the current market performance?

A: The company makes full use of the results of the creation of digital factories, through technological application, technological innovation and other measures to increase the proportion of the company's intelligent production line and digital factories, and constantly improve the per capita production capacity. In addition, through the adoption of energy-saving technologies, increase the proportion of new energy use such as photovoltaic, wind power and other measures to promote cost reduction. In terms of process technology, through the innovation and improvement of kiln technology, energy utilization efficiency, leakage plate technology, chemical raw material development and homemade, glass fiber formula, etc., we can give full play to our advantages and further reduce production costs.

Q: What are the specific factors for the decline in the company's net profit and gross margin? What measures will the company take to reduce costs and increase efficiency to improve profitability and reverse the decline in profits?

A: The decline in the company's net profit in 2024 is mainly due to the still low product prices. However, after multiple rounds of repricing and cost decline, the company's net profit from withholding to the mother narrowed, and improved significantly quarter by quarter. In 2025, the company will continue the core strategy of "increment, stable price, return price, and price adjustment" to do a good job in sales, maintain the industry ecology, further reduce production costs, optimize product structure, and enhance competitiveness and profitability.

Q: How does the company respond to the challenge of global glass fiber demand fragmentation?

A: The company has built overseas production bases in Egypt and the United States, which can meet about 50% of the overseas market demand. At the same time, the company actively studied and demonstrated the feasibility of increasing overseas investment layout to further reduce overseas trade risks.

Q: How much room will there be for high-end products such as wind power and new energy vehicles to increase their share?

A: In recent years, the company has accelerated the adjustment of product structure, and the proportion of high-end products has continued to increase. In 2024, the sales volume of products in emerging application areas such as wind power and thermoplastics increased higher than that of traditional products.

Q: How does the company improve its ESG rating through zero-carbon base and energy structure adjustment?

A: The company attaches great importance to ESG construction and takes many measures to promote the rating improvement. Among them, Huaian glass fiber zero-carbon intelligent manufacturing base green electricity usage rate reached 100%, integrated innovation and comprehensive application of the current industry's most advanced, most mature, most cutting-edge equipment and technology, to create a high-quality project in the glass fiber industry. The company actively creates green production demonstration scenes of glass fiber products through green design, and penetrates the concept of "green and low-carbon" into the whole life cycle of products such as research and development, production, logistics, and customer service. Through energy saving, green electricity, carbon sink and other technical routes, open up the glass fiber zero-carbon manufacturing path, and finally achieve the goal of zero carbon. (Source: Chinese Megalithic)