Huafeng Spandex Has A Net Profit Of 441 Million In 2018, Adjusting Its Product Structure To Achieve Steady Growth In Performance.

The Zhejiang Huafeng spandex spanning Limited by Share Ltd (hereinafter referred to as "Huafeng spandex"), which has been engaged in the processing, manufacturing, marketing and technology development of Spandex Products, issued the 2018 annual performance bulletin in February 22nd. During the reporting period, the company achieved a total revenue of 4 billion 436 million yuan, an increase of 6.89% over the same period, a profit of 504 million yuan, an increase of 19.60% over the previous year, a total profit of 503 million yuan, an increase of 12.89% over the previous year, and a net profit of 441 million yuan attributable to the shareholders of the listed company, an increase of 14.34% over the previous year; and a basic earnings per share of 0.26 yuan.

Huafeng spandex explained that during the reporting period, the industry boom declined, and the market competition was intense. The company continued to carry out technical pformation and upgrading to improve production efficiency and reduce costs. The company continued to optimize its product structure and profit structure. The spandex production and sales increased over the same period last year, operating income increased by 6.89% over the same period last year, and net profit increased by 14.34% over the same period last year.

According to the insiders, the product structure of Huafeng spandex has achieved steady growth in the counter trend.

In 2018, domestic spandex prices showed a gradual downward trend. The price of 40D dropped from 37500 yuan / ton to 33000 yuan / ton at the beginning of the year, or 4500 yuan / ton.

On the one hand, influenced by the collapse of raw material MDI prices, the price of MDI dropped to 21600 yuan / ton from the 1 quarter of 2018 to 21600 yuan / ton, or 40%. On the other hand, the demand growth slowed down in the first three quarters of 2018, and the price was dragged down.

Although spandex prices continue to decline, but the same period average price is still higher than in 2017.

According to the results of the report, Huafeng spandex achieved a business income of 2 billion 205 million yuan in the first three quarters of 2018, an increase of 19.46% over the same period, and a net profit of 248 million yuan, an increase of 28.88% over the same period last year.

The overall processing profit of the industry gradually narrowed, but the gross profit margin of the company increased by 3 percentage points over the same period last year, mainly due to the improvement of the profit level of the company by adjusting the product structure.

Public information shows that Huafeng spandex was founded in December 1999. It is one of the earliest and most mature enterprises in the spandex industry in China. It is also the largest spanning spanning production company in China.

The main business is spandex product processing, manufacturing, sales and technology development. The main product is spandex. The company has 117 thousand tons of spandex production capacity, of which the unit has 57 thousand tons, which is equipped with a thermoelectric plant, which supplies part of the production electricity; 60 thousand tons of Chongqing, and another 100 thousand tons of spandex in Chongqing is being built. The first phase is 60000 tons / year, the implementation time is 2017 ~2019 August, the trial production is completed, the second phase 40000 tons / year, the implementation time is completed in December 2019, and the total production investment is 2 billion 630 million yuan. The total annual investment is expected to increase by 2 billion 704 million yuan, with an annual average profit of about 590 million yuan.

Analysts believe that from the perspective of operating income, spandex products constitute the income of 100% of Huafeng spandex. According to the breakdown of product structure, the 40D specification accounts for about half of the revenue, and the rest is 30D, 20D and thick wire.

In recent years, the operation of Huafeng spandex business has increased rapidly, especially after the operation of Huafeng spandex base in Chongqing. Historically, in 2008 -2017, the compound income increased by 16.9% and the net profit increased by 9.1%.

Guo Lian Securities researcher Ma Qunxing said that with the upgrading of consumption, consumers have higher requirements for resilience, sweat resistance and seawater resistance of spandex, so developing high performance, differentiated and functional high-grade spandex is the trend of the times.

In the domestic spandex industry, Huafeng spandex has developed a series of high-performance differential spandex.

In 2017, Huafeng spandex super chlorine resistant spandex, heat-resistant black spandex and diapers were successfully industrialized with spandex. At the same time, the empty bag integrated machine, warp knitted flannelette, circular machine and cotton bag were gradually becoming the flagship or benchmark products of the mainstream market.

At present, Huafeng spandex differentiated products account for less than 10%, and the company is also accelerating the development and industrialization of differentiated products, greatly improving the profitability of Spandex Products.

In addition, the company relies on the modern data analysis system such as ERP system, production line cost accounting model and so on, through the implementation of targeted fine management measures, so that production cost control, energy saving and other fields maintain the world's advanced level in the same industry.

Ma Group expects that with the full release of Chongqing's capacity and the launch of new technology in the future, the production scale of Huafeng spandex will further expand, and the proportion of advanced production capacity will increase substantially, which is expected to further reduce the company's production costs and improve its profitability.