On behalf of the board of directors (the “Board”) of West China Cement Limited and its subsidiaries, I am pleased to present to our shareholders the annual report (including the audited consolidated financial statements) of the Group for the year ended 31 December 2025.

OVERVIEW

2025 has proved to be a pivotal year for the Group, marked by significant operational change and progress. On the operational side, the Group has seen some deteriorations for its core China operations as a result of the declining national cement demand which led to the decrease in both ASP and gross profit. Internationally, investments in sub-Saharan Africa and Central Asia began to pay off, with those operations have started to contribute significantly to the Group’s profitability.

The Group’s operations in China have continued to be affected by a relatively subdued construction market due to low levels of infrastructure and real estate demand growth. Demand in Shaanxi Province has outpaced the rest of the PRC market, with Fixed Asset Investment (FDI) growth of -2.8% compared with -3.8% for the PRC as a whole and Real Estate Development Investment (RDI) growth at -7.9% versus -17.2% for the whole country, but activity has remained lacklustre. In the face of this subdued demand, the supply side has been relatively disciplined, with peak-shifting production halts and increased environmental controls limiting excessive oversupply. This has led to some modest decrease in the Group’s ASPs in China. In addition, unit costs have fallen, especially in Shaanxi Province, due to lower coal costs. Consequently, despite reduced volumes, gross margins remained stable, resulting in a stable impact on the Group’s profitability.

Since 2020, the Group has expanded its production into overseas markets in sub-Saharan Africa and Central Asia, supplying its cement products to infrastructure, urban and rural development markets in these continents. The Group believes its cement plant construction and cement production and sales expertise is uniquely positioned to support and benefit from economic and cement industry development in these geographies. Africa has the world’s fastest population growth profile, with total population expected to reach nearly 2.5 billion in 2050 from 1.5 billion in 2024. Sub-Saharan Africa has some of the fastest GDP growth rates in the world. Infrastructure development and urbanization in these markets are benefiting from domestic and international growth policies, including the Chinese Government’s Belt and Road Initiative. Sub-Saharan Africa has some of the lowest per capita cement consumption rates in the world, at a fraction of those in developed markets, and cement production in many countries is backward, under-supplied and highly fragmented

FINANCIAL RESULTS

In 2025, the Group saw a tough operating environment in China. The Group’s cement and clinker sales volumes have increased slightly from 20.0 million tons in 2024 to 21.8 million tons in 2025 and the Group has recorded a 24.6% increase in gross profit as compared to 2024. Moreover, the Group has maintained strong cash flows, with stable EBITDA maintaining at approximately RMB2.6 billion and 3.0 billion in 2024 and 2025, respectively. The Group’s net gearing ratio has in turn increased from 65.3% in 2024 to 71.6% in 2025, as a result of the increase in borrowings for capacity development during the year. The ratio is still maintained at a low industry level to provide a healthy statement of financial positions in the Group.

DIVIDEND

Having considered the Group’s increased net profit for the year ended 31 December 2025, the Board has recommended payment of a final dividend of RMB4.8 cents per ordinary share for this financial year.

OPERATIONS

Deteriorations in the Group’s China operations as a result of the declining national cement demand, netting with increasing contributions from the overseas business, have led to a moderate improvement in the Group’s financial performance in 2025. Cement and clinker sales volumes in the reporting period have risen by 9.0% to 21.8 million tons. While sales volumes in China fell by 18.8% to 13.0 million tons, overseas volumes have risen by 120% to 8.8 million tons.

In China, cement and clinker ASPs decreased by 6.3% to RMB251 per ton. However, benefiting from the lower production costs, the Group was able to keep a stable Gross Profits per Ton (GP/T) of RMB39. Overseas, significant increases in sales volumes have resulted in much more sustainable ASPs of RMB470 per ton, resulting in an average GP/T of RMB171.

The Group’s revenues rose to RMB9.62 billion in 2025, with RMB4.92 billion coming from its core China markets and RMB4.70 billion from overseas markets. Total gross profits of the Group was RMB2.46 billion in 2025. As overseas ASPs and GP/Ts were higher than those in domestic markets, the Group recorded RMB0.5 billion in gross profits from China and RMB1.96 billion from overseas. Total EBITDA of the Group in 2025 was RMB3.02 billion.

The Group believes that its focus on overseas development, including expansion in sub-Saharan Africa and Central Asia, has been validated by its recent financial performance. In 2025, while cement and clinker sales volumes overseas amounted to 40% of total Group sales, income from these overseas markets made up approximately 49% of the Group’s total revenue and 80% of the Group’s gross profit.

ENVIRONMENT & SOCIAL & GOVERNANCE

The Group continues to monitor and improve its environmental and emission standards in the following ways. Firstly, the Group’s ‘Benchmarking Checklist of Environmental Protection Regulations and Standards’ has been implemented to carry out in depth monitoring of emissions and training of the Group’s staff. Secondly, the Group’s ‘Safety and Environment Department’ conducts quarterly inspections of monitoring reports and environment management measures at each plant. Thirdly, disposal and storage of hazardous waste is carefully planned on an annual basis, with waste labelled and disposed of in accordance with the new emission standards issued by the Ministry of Ecology and Environment. All of the Group’s plants in the PRC have been refurbished as ‘Garden-like Plants’, and the Group has implemented similar strategies at its plants in Africa to enhance environmental management there. Practices such as soil reclamation and mine re-greening are carried out at the Group’s limestone mines and annual monitoring work in areas such as landscaping, slope deformation, soil and water pollution, soil quality, reclamation and vegetation is carried out to ensure mine recovery and land reclamation at end-of-life mines.

The Group fully adheres to the ‘Work Safety Law’ in the PRC as well as any regulations in the countries in which it operates. During the year, there were zero fatalities and 898 days lost to injury compared with 1,364 in 2024. The Group runs a standardised and regulated operation process for workplace safety that is a requirement for employees and contractors alike. There is also a Safety Production Committee, headed by the Group CEO and comprises six specialised safety leadership teams. Robust anti-corruption and integrity policies have been put in place at all of the Group’s operations. These include transparent anti-fraud monitoring systems and reporting platforms, and the Group maintains ongoing risk assessment activities and anti-corruption training for all staff. The Group also has robust supply chain management systems in place, with a digital management platform and centralised supplier data base. The Group has over 2000 suppliers of which over 600 are long term partners. These suppliers are subjected to ongoing audits, including supplier evaluations and risk assessment monitoring.

During the year, charitable donations made by the Group amounted to RMB5.8 million. Some of the projects that the Group has contributed to include the construction of the Mudada Village Primary School and Katenbe Manatee School in Mozambique; the Shaanxi Yaobai Education Foundation, which aims to improve the quality of basic education in Shaanxi Province; and continued contributions to the ‘Golden Autumn School Aid’ activity, which has benefited 115 students in need of educational support.

OUTLOOK

Following the progress that has been made in 2025 on both the operational and M&A side, the Group’s priorities are focused on strengthening the Group’s financial position, continuing to benefit from the stable performance in the China markets and strengthening its position in its overseas markets, where much progress has already been achieved.

Firstly, the Group completed the disposal of its Xinjiang plants to members of the Anhui Conch Cement Company Limited group in August 2025, and this disposal is expected to bring in approximately RMB1.65 billion of cash, subject to adjustments. Some of this cash has been earmarked for the partial repayment of the Group’s US$600 million 4.95% senior notes which are due to mature in July 2026. In order to further optimize the Group’s investment structure, reduce its debt ratio, save on interest costs, allocate resources more effectively, strengthen its strategic focus on key areas of development, advance the expansion and deepening of the Group’s presence in overseas markets, and enhance the Group’s overall operational efficiency and long-term competitiveness, the Group is currently in preliminary discussions to dispose certain assets located in China.

Secondly, the Group aims to benefit from the increased levels of supply side discipline in Shaanxi Province and the continued environmental controls that have succeeded in limiting excessive supply in the province. While the Group does not expect any significantly strong pick up in real estate development in 2026, there is some reasonable demand coming from infrastructure projects in Shaanxi; if supply discipline, construction activity and pricing levels from 2025 continue into 2026, the Group expects stable financial returns from its China operations in 2026.

Finally, the Group aims to build on and strengthen its position in its burgeoning overseas markets. Since 2020, the Group has built a significant presence in the Ethiopia cement market, has one of two operational clinker plants in Mozambique (the other one, the Dugongo Nampula Plant, which are due to be completed in the first quarter of 2027) and has built the largest clinker and cement operation in the Great Lake region of the DRC, Rwanda and western Tanzania, as well as expanding into Uzbekistan.

Two further developments will continue to strengthen the Group’s Great Lake operations in a region which, despite the current armed conflict in Goma, is a high-growth resource and infrastructure-led market. Firstly, the Group completed the acquisition of the Cimenterie de Lukala (CILU) plant, located in the DRC’s capital city of Kinshasa, in December 2025, this will extend the Group’s market strength into the west of the DRC. Secondly, the Group aims to complete the construction of the Moroto Plant and Jinja Grinding Mill in Uganda in the first quarter of 2026. This market is a natural geographical extension of the Great Lakes area and will help the Group to strengthen its position as one of sub-Saharan and East Africa’s major cement producers.

On behalf of the Board, I would like to take this opportunity to thank our management, employees, bankers and advisors for their efforts in 2025. I would also like to thank our shareholders for their continuing support of our Group in the past and into the future.

Zhang Jimin
Chairman
23 March 2026