◎ Si Xianchao

Listed Tire Enterprises

On August 2, Shandong Linglong Tire Co., Ltd. took the lead in publishing the semi-annual performance and subsequently, the other 10 listed tire enterprises in China also successively published their operation data in the first half year.

Table 1: Performance of 10 tire listed companies in the first half of the year

Unit: 100 million CNY

It can be seen from Table 1 that in the first half year, among 10 enterprises, 5 had a positive growth in operating revenue, with the growth no more than 10%, and 5 had a year-on-year decline in operating revenue, with the decline below 10% except for AEOLUS TYRE.

In net profit attributable to the shareholders of the listed company, 5 companies realized a positive growth, in which Sailun Jinyu and Guizhou Tyre had a large growth and Linglong Tire had a growth of 20.77% to be 524 Million Yuan, which was the highest among the listed tire enterprises.

From this year, the price of NR, SR, all-steel cord, etc. was stable and low, however, the cost of carbon black, rubber chemicals, energy, human resources and environmental protection was still high. Although the price of rubber chemicals had a rising trend, the price nally will be in a reasonable position along with increase of industrial concentration and promotion of upgrading and reconstruction.

In the first half year, the whole price of main raw materials of tire products slightly fell compared with that in the same period of last year, the tire price up-regulated from last year will relieve the cost pressure increased in this part, which has a positive impact on increase of semi-annual and even annual profit level of the industry.

Recently, the magazine China Rubber carried out a survey on the situation of tire industry in 2018, among nearly 200 insiders, 72 expressed that the performance of tire enterprises in this year would be slightly better and even have obvious growth than that in last year; 64 expressed that the performance of the enterprises in this year would not be obviously improved and the profit level would still be low; and 64 expressed that the operation conditions of the enterprises in this year would become worse and not optimistic.

Along with deep promotion of national supply-side reform and intensification of elimination of outdated capacity, the requirements for environmental protection were increasingly stringent, in the first half year, the shuflle and integration effect of the industry was obvious, a dozen enterprises were closed down only in June, and the industrial concentration was further improved.

However, some insiders also expressed worry, “At present, the tire industry still has problems such as excess capacity, severe homogenization, insufficient innovation ability and poor core competitiveness, all of these are reasons for weak strength of Chinese tire industry on the whole, the industry still needs to take supply-side structural reform as the main line and rmly take the modern development path of intelligent and informatization reform and lean management.”

Listed Enterprises of Non-tire Rubber Products

By the end of August, all the semi-annual operation data of the listed large-scale enterprises of non-tire rubber products in China was published, see Table 2.

Table 2: Performance of domestic large non-tire rubber item companies in the first half of the year

Unit: 100 million CNY

The operating revenue of all 11 statistical listed enterprises realized growth, in which, Jiangyin Haida Rubber and Plastic Co., Ltd. had the largest year-on-year growth (99.63%), Zhejiang Tiantie Industrial Co., Ltd. (60.19%) and Wuxi Boton Technology Co., Ltd. (25.18%) fellow up and Sanlux Co., Ltd. had the smallest growth (0.41%).

In net profit attributable to the shareholders of the listed company, all 11 enterprises got a profit during the report period, in which Anhui Zhongding Seal Parts Co., Ltd. had the highest net profit attributable to the shareholders (702 Million Yuan), which was far higher than the other listed companies; 4 had a year-on-year decline of profit and 5 had a year-on-year growth, in which Zhuzhou Times New Material Technology Co., Ltd. had the largest growth (138.26%).

The performance growth of each enterprise attributed to constant growth of downstream demand, and the enterprises with declining profit gave the reasons such as increase in price of raw materials, enlargement of environment protection input and increase in labor cost.

In the first half year, the total operating revenue of Wuxi Boton Technology Company was 989 Million Yuan, the rate of its conveyor belt business had declined to be 33.77% while the rate of its online game business was more than half to make a major contribution to its profit of 142 Million Yuan in half year.

Shandong Meichen Ecology & Environment Co., Ltd. also expressed its decision of joining in garden and park business, in the first half year, the total operating revenue of this company was 1,791 Million Yuan, in which its garden and park business accounted for 63.43%; in addition, it actively implemented the strategic transformation to garden and park business, its net profit attributable to the shareholders of the listed company sharply increased by 30.74% to be 310 Million Yuan.

Listed Rubber Chemicals Enterprises

According to the statistics of CRIA Rubber Chemicals Specialized Committee, from January to May, the operation of rubber chemicals industry showed a trend of increase in quantity and rise in price, and its total output had a year-on-year growth of 9.7%, in which, the total industrial output value was about 1 Billion Yuan more than the total sales volume, which indicated that the rubber chemicals enterprises had certain inventory.

In the operation data of three A-share listed enterprises in China in the first half year, the operating revenue and profit had a sharp year-on-year growth and the output had growth in varying degrees.

Table 3: Performance of A-share listed rubber additives enterprises in the first half of the year

Unit: 100 million CNY

In the first half year, China’s rubber chemicals industry was still under the huge pressure of environmental protection trend, however, the industrial concentration was constantly enhanced, the leading enterprises constantly innovated and invested in environmental protection, the industry was in good overall operation conditions, and there was a guarantee for stable supply of products to the downstream.

In the first half year, the operation conditions of backbone rubber chemicals enterprises were ahead of the industry, which guaranteed safe and stable supply of rubber chemicals. Backbone enterprises not only constantly innovated in end treatment technology to ensure up-to-standard discharge of the enterprises, but also actively carried out original innovation of process technology to gradually realize zero discharge of waste water of rubber accelerators. Backbone enterprises such as Yanggu Huatai, Sunsine Chemical and Kemai Chemical vigorously carried out product innovation, process innovation, equipment innovation, management innovation, etc. by spontaneous “industry-university-research” innovation mode of the enterprise to make the independent innovation of the enterprises gradually normalized and enhance the source power for promoting sustainable development of the industry.

Listed Carbon Black Enterprises

4 listed carbon black enterprises in China published their operation conditions in the first half year, the operating revenue of the carbon black enterprises had a sharp year-on-year growth and the profit level was further improved.

Table 4: Performance of 4 carbon black listed companies in the first half of the year

Unit: 100 million CNY

Black Cat expressed that in the first half year, the work of eliminating outdated capacity of domestic chemical enterprises was constantly carried out, a large amount of small and medium-sized enterprises were eliminated for problems such as small production scale, unstable quality and low yield and the market was further concentrated to large-scale carbon black enterprises, during the report period, the product price slightly increased compared with that in the same period of last year and the profit level was slightly improved.

Longxing Chemical mentioned in the report that benefiting from constant influence of supply-side reform and environmental protection law enforcement policy, the supply and demand pattern of carbon black industry was further improved, large-scale carbon black enterprises were in good operation conditions and their revenue was sharply increased.

Yongdong Chemical expressed that the downstream demand kept strong and the rate of operation was always in a high level. This company insisted on the chain mode of circular economic industry of “processing of coal tar manufacturing of carbon black power generation of tail gas”, scientifically organized production and adhered to green development, thus its economic bene ts were constantly improved.

The total operating revenue of Jinneng Science & Technology was increased by 28.74% to be 4.039 Billion Yuan, in which the carbon black business accounted for 20.1%; its total net profit attributable to the shareholders of the listed company was 523 Million Yuan, with an increase of 43.57%. This company expressed that because of constant growth of downstream demand and deep promotion of supply-side reform, its profitability was sharply improved.

According to the statistics of CRIA Carbon Black Branch, in the first half year, the output of carbon black had a year-on-year growth of 3.4%, the carbon black sales volume of the member enterprises increased by 1.8%, the sales-output ratio reached 95% and the average equipment utilization rate reached 86%. The equipment utilization rate of the member enterprises was obviously improved, especially that of the top 10 carbon black manufacturing enterprises reached 95% and a part of enterprises realized over capacity, for example, 5 enterprises such as Shanxi Sanqiang, Shanxi Anlun and Shanxi Yongdong realized over capacity.