Zhejiang Long Sheng (600352): Net Profit Of 4 Billion 100 Million Yuan, Is Expected To Maintain High Dye Market This Year.

On the evening of April 1st, Zhejiang Longsheng (600352) released its annual report of 2018. The company achieved double breakthroughs in business revenue and profits and hit a record high.

Among them, the total business income was 19 billion 76 million yuan, an increase of 26.32% over the same period last year, and realized a profit of 5 billion 88 million yuan, an increase of 49.38% over the same period last year. The net profit attributable to shareholders of the parent company was 4 billion 111 million yuan, up 66.2% over the same period last year.

Holding 1900 patents

With the completion of the dye industry migration from developed countries in Europe and America to developing countries in Asia, China's dye production now accounts for nearly 70% of the world's total output.

Today, China is not only the largest producer of dyestuffs, but also the largest demand and exporter of dyes.

Longsheng, Zhejiang from Shangyu, Zhejiang, is a banner of China's dyestuffs.

As the world's leading producer of special chemical products and industries, Zhejiang Longsheng has 300 thousand tons of dye production capacity and an annual capacity of 100 thousand tons of auxiliaries, ranking first in the global market.

At the same time, the company also has an annual capacity of 110 thousand tons of intermediates, and the yield of benzyl two amine and resorcinol ranks the highest in the world.

During the reporting period, Zhejiang Longsheng global dye sales volume of 241 thousand and 900 tons, intermediate sales volume of 107 thousand and 300 tons, dyestuff and intermediates business has been neck and neck, become an important pillar of the company's profits, especially intermediates business actively grasp the international and domestic market capacity limited favorable situation, ensure the safety of production premise, the core product volume and price rise, has developed into a dyestuff business after another core business.

During the reporting period, the company achieved 16 billion 230 million yuan in operating income, 49.77% in gross profit margin and 40% in gross profit margin in the same industry.

Specifically, the gross profit margin of dyes was 47.83%, an increase of 8.93 percentage points over the previous year, and the gross profit margin of intermediates reached 63.01%, representing an increase of 16.76 percentage points over the previous year.

Capacity scale and patent are important factors for Zhejiang Longsheng to control the dye industry.

At present, the company has strong R & D strength, providing strong technical support for product development in the high-end market.

As at the end of the announcement, Zhejiang Longsheng has nearly 1900 patents both inside and outside the country.

Continue to expand intermediate capacity

Recently, the stock price of Zhejiang Longsheng has been quite strong in the two tier market, which is related to the explosion in Xiangshui, Jiangsu.

In March 21st, an explosion occurred at the eco Chemical Industrial Park in Xiangshui, Jiangsu.

According to the Yancheng news release, as at 16 hours in March 31st, there were 245 hospitalized casualties and 5 severe injuries, including 2 critically ill patients.

31 new patients were discharged.

Prior to the announcement, as of 16 March 25th, the explosion has caused 78 deaths.

The explosion occurred in Jiangsu Tian Jia Yi Chemical Industry Co., Ltd., in the introduction of the official website. The company is a fine chemical enterprise affiliated to Ni Jiayan Chemical Co., Ltd. of Jiangyin, and has an annual capacity of 20 thousand tons. It is one of the three largest manufacturers of benzene and two amine in the country, and the other two are Zhejiang Longsheng and Sichuan red light, two.

The annual report shows that after fifteen years of development in Zhejiang's Dragon business, especially with the construction of the large-scale production unit of the benzamine two amine and the continuous improvement of production technology and technology, the production cost of interphenylene amine two has gradually decreased, and the scale advantages and cost advantages have made the company the leading industry of phthalamine two.

In addition to traditional applications such as dyestuffs, the emerging applications of resorcinol have been continuously developed. The demand for benzyl two amine is increasing rapidly. Resorcinol domain will become the largest consumer market of benzene two amine in the next few years.

Data show that in 2018, Zhejiang Longsheng intermediate production volume was 110 thousand tons, with sales volume of 107 thousand tons.

Intermediates in 2018 sales revenue reached 3 billion 645 million yuan, gross margin reached 63.01%.

In the company's development strategy, Zhejiang Longsheng pointed out that the intermediate business company will continue to expand the market share of two benzyl amine and resorcinol, expand the capacity of benzene two amine to 100 thousand tons / year in the future, and expand the production of resorcinol to 50 thousand tons / year. At the same time, it will expand the production of related intermediates with the integration as the core, develop new intermediates, integrate and extend the upstream of the dye supply chain, continue to improve and upgrade the industrial chain, strengthen the control position of strategic intermediate raw materials, and create a pparent factory that is safe and digitalized.

The dye market is expected to run high.

Zhejiang Longsheng's main dyestuffs, intermediates, water reducing agents and inorganic chemical business have the risk of improving environmental protection requirements.

With the pformation of China's economic growth mode and the full implementation of the strategy of sustainable development, the introduction of new environmental regulations and the strictness of environmental protection standards will increase the cost of environmental protection.

Data show that Zhejiang Longsheng's environmental investment in 2018 was 825 million yuan, accounting for 4.33% of its revenue.

In the same period, the R & D investment of the company was 732 million yuan, accounting for 3.83% of its operating income.

In the chemical industry, the safety of production has always been heavy, and the explosion in Xiangshui has once again sounded the alarm to the industry.

In the annual report, Zhejiang Longsheng pointed out that the dye business continues to take the opportunity of upgrading safety standards and upgrading environmental protection. Through technological pformation, the total dye production capacity of the world has reached 350 thousand tons / year, ensuring that the core business continues to lead the world.

Taking advantage of the opportunity of gathering and upgrading of downstream printing and dyeing industry, we should actively promote the pformation of downstream printing and dyeing methods, try to explore new environmentally friendly technologies and flexible production in the downstream, and provide a full range of printing and dyeing products, printing and dyeing technology and environmental protection support for the downstream, and promote the establishment of products, ecological chains of dyes, printing and dyeing, clothing retailers and consumers.

Zhejiang Longsheng said that 2018 is the key year for tackling national pollution control. Many enterprises in the dyestuff industry have limited production and shut down, resulting in tight supply in the whole industry, and the price of products has been rising steadily.

Looking back in 2018, China's dyestuff market is running at a high level. It is estimated that the domestic dyestuff market will continue to operate at a high level in 2019 under the condition of ecological environmental protection and safety supervision.

The business plan shows that the total revenue of Zhejiang Longsheng plan in 2019 is 22 billion yuan, an increase of 15.33% over the previous year, with a total profit of 6 billion 300 million yuan, an increase of 25.05% over the previous year, and a net profit attributable to the owners of the parent company was 5 billion yuan, an increase of 21.61% over the previous year.