China ACM

November 15, 2010 07:55 ET

China ACM Raises Ready-Mix Concrete Prices 25%

BEIJING--(Marketwire - November 15, 2010) - China Advanced Construction Materials Group, Inc. (NASDAQ: CADC) ("China ACM"), a leading provider of ready-mix concrete and related technical services in China, today announced that in response to increasing raw material costs, it is raising the average price of its ready-mix concrete (RMC) 25 percent across the range of its C10-C100 concrete sales products.

The Company noted that, in recent months, its fixed RMC plants in the Beijing area have experienced 19.8 percent higher costs for their commodity raw materials including cement and other RMC components such as sand, gravel, mineral powder, slag powder and mineral sand amongst others.

China ACM's Concrete Sales contracts are typically from three to twelve months in duration, averaging four to eight months, and carry fixed RMC pricing. As those contracts are ending, the Company is charging new, higher prices reflecting increased raw material costs. These Concrete Sales contracts contain pass through features for significant raw material price increases.

China ACM is also gaining stronger pricing power due to ongoing industry consolidation and attrition of marginal companies in the Beijing concrete industry. The total number of Beijing area concrete companies was down to 165 at year-end 2009 and is decreasing.

Conversely, at China ACM's portable RMC plants servicing HSR projects, its large contractor clients are responsible for purchasing the raw materials so China ACM is not affected by changing raw material costs.

China ACM provides proprietary and patented premium RMC high performance blends including its patented blend with a 100-year warranty, or double the industry average. It further distinguishes itself by providing its clients with a high degree of project flexibility, responsiveness and unrivalled chemical engineering and related technical consulting services.

About China ACM
China ACM is a leading producer of advanced, certified eco-friendly ready-mix concrete (RMC) and related technical services for large scale, high-speed rail (HSR) and other complex infrastructure projects. Leveraging its proprietary technology and value-add engineering services model, the Company has won work on numerous high profile projects including the 30,000 km China HSR expansion, the Olympic Stadium Birds' Nest, Beijing South Railway Station, Beijing International Airport, National Centre for Performing Arts, CCTV Headquarters, Beijing Yintai Building and U.S. and French embassies.

Founded in 2002, Beijing-based China ACM provides its materials and services through its network of fixed ready-mix concrete plants covering the Beijing metropolitan area. It also has technical services and preferred procurement agreements with other independently-owned plants across China. Additionally, the Company owns numerous portable plants deployed in various provinces across China. More information about the Company is available at

Forward-Looking Statements
This press release contains statements that are forward-looking in nature, including statements regarding the Company's competitive position and product and service offerings. These statements are based on current expectations on the date of this press release and involve a number of risks and uncertainties, which may cause actual results to differ significantly from such estimates. The risks include, but are not limited to, the degree of market adoption of the Company's product and service offerings; market competition; dependence on strategic partners; and the Company's ability to manage its business effectively in a rapidly evolving market. Certain of these and other risks are set forth in more detail in "Item 1A. Risk Factors" in China ACM's Annual Report on Form 10-K for the fiscal year ended June 30, 2010. China ACM does not assume any obligation to update or revise any such forward-looking statements, whether as the result of new developments or otherwise.

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