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Hubei Sanonda Co., Ltd. (Hubei Sanonda) maintains profit gaining in Q3 with year-on-year growth of 117.99% in net profit, which reached USD22.85 million (RMB140.42 million). Meanwhile, the company's total revenue increased by 17.66% year on year to USD141.02 million (RMB866.67 million), according to its Q3 report in 2014. Added by the excellent performance in Q3 2014, according to Herbicides China News 1411 on November by CCM.
Hubei Sanonda's net profit in the first three quarters of 2014 reached USD69.78 million (RMB428.83 million) in total, with year-on year growth of 123.48%. It's observed that not all of the year-on-year three-digit growth in net profit come from Q3 2014. According to Hubei Sanonda's semi-annual report in 2014, the company's semi-annual net profit has already increased by 126.25% year on year to USD46.93 million (RMB288.41 million). And it's predicted that the company will witness continuous performance growth in the full year because of the solid gaining basis in the first three quarters of 2014, as well as the coming peak season for Chinese pesticide market in the last quarter of 2014.
As explained by Hubei Sanonda itself, the brilliant profit gained in the first three quarters was mainly attributed to several key reasons:
1. The company received more export orders on the basis of stable domestic sales. It's disclosed in the semi-annual reported that Hubei Sanonda's gross profit margin in export expanded by 13.45% year on year, and the gross profit margin in domestic sales
witnessed year-on-year growth of only 6.73% in the first half year of 2014.
2. The market quotations of main products of Hubei Sanonda, such as paraquat, acephate, 2,4-D and so forth, were stable due to the calm agricultural market. According to the price monitoring in 2014, the prices of these pesticides except glyphosate were all stable. Coupled with continuous industrial integration and stricter environmental protection, Hubei Sanonda will show more obvious advantage in price bargain.
3. The reasonable cost control. It's released incompletely by Hubei Sanonda that the price of materials in the company's pesticide productions maintain stable at a low level in the first three quarters of 2014, mainly because of correct prediction and large-volume purchase. And the complete facilities contributed to energy saving.
A series of measures for performance improvement in Hubei Sanonda have worked finally, and the company's stock price ascended accordingly in 2014. Especially in March and Oct. 2014, the stock price jumped twice to meet the top of RMB14.94 in Oct. 9 2014. And this happened after China National Agrochemical Corporation had transferred its holding of 100% share equity of Sanonda Group Co., Ltd. to ADAMA (ADAMA agricultural solutions Ltd., original Maksim Agam Industrial Company) on 9 Oct. 2014, which lead to ADAMA directly and indirectly holding a total of 30.75% share equity of Hubei Sanonda. It means that Hubei Sanonda will cooperate with ADAMA.
As for Hubei Sanonda, ADAMA's large sales network and resources in overseas market will help it improve export business. And the diverse product lines and overseas registrations in ADAMA will also push Hubei Sanonda develop OEM business in the future, which can improve Hubei Sanonda's gross profit margin. Of course all of these prediction will not appear until the two company's equity transference finished. The exact date is unclear at present.
Table of Content: Herbicides China News 1411
Hubei Sanonda witnesses continuous growth in Q3 2014
Lier Chemical's recent state and further strategy in 2014
Market conditions of corn herbicides in China in 2014
Characteristics of herbicide resistance of weeds in China
Herbicide market meets developing peak
China's demand for sunflower herbicides to further grow
Overview of China's herbicide export in Q1-Q3 2014
China's import volume of herbicide products up by 14.22% year on year, Q1-Q3 2014
China's dicamba registration in Nov. 2014
China's new registrations of herbicide TC, Oct. 2014
China's herbicides industry witnessed a great development in the past few years and China has become one of the top herbicide a.i. suppliers in the world. Nevertheless, theherbicide business will still be the key growth point in the whole pesticide industry in the next 5 years. It is expected that the output of China's herbicides will increase with a CAGR of 6.2%, reaching 2,000,000 tonnesand that the export volume will exceed 800,000 tonnes in 2014. Therefore, most Chinese herbicides manufacturers are starving for advanced technologies and professional enterprise management.Many of them are looking forward to cooperating with overseas companies and explore China's huge herbicide market together. From the issues of Herbicides China News, keeping track of China's herbicide industry will help you know what market China will explore and when. Knowing the current market dynamics of China's herbicides will facilitate your search for great commercial opportunities in China's huge market.
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