China Sunsine Chemical Reports Strong Q3 Performance Amid Economic Challenges
China Sunsine Chemical Reports Strong Q3 Performance Amid Economic Challenges
China Sunsine Chemical Holdings Ltd. has released its business updates for the third quarter of 2024, showcasing a robust performance amidst a backdrop of global economic uncertainties and geopolitical tensions.
Key Financial Highlights
- Net profit surged by 43% year-on-year to RMB 92.9 million in Q3 2024, up from RMB 65.0 million in Q3 2023.
- Sales revenue increased slightly by 1% to RMB 884.1 million, driven by a 5% rise in Average Selling Price (ASP) to RMB 16,147 per tonne.
- For the first three quarters of 2024, the Group sold 159,555 tonnes of products, with sales revenue reaching RMB 2,633.2 million and net profit rising by 9% to RMB 281.7 million.
Market and Economic Context
China’s GDP grew by 4.8% year-on-year in the first three quarters of 2024, with a 4.6% growth in Q3 2024. The country produced 833.55 million tyres, marking a 9.1% increase year-on-year. Additionally, auto sales in China reached 21.57 million units, with New Energy Vehicles (NEVs) sales accounting for 38.6% of total new vehicle sales, rising by 32.5% year-on-year.
Challenges and Competition
Despite the positive financials, the company acknowledged ongoing challenges, including high interest rates, the Ukraine-Russia conflict, the Israel-Hamas conflict, and rising geopolitical tensions between the US and China. Locally, China Sunsine continues to face strong competition in the rubber chemicals industry.
Strategic Updates
The Group is optimistic about the Chinese government’s stimulus policies aimed at boosting the economy and local consumption, which could drive demand for vehicles, tyres, and related products. China Sunsine is committed to its strategy of “sales production equilibrium” and aims to strengthen its market leadership position.
Capacity Expansion Plans
- Phase 1 of the 20,000-tonne per annum Continuous Production of High Quality MBT project is nearing completion, with commercial production expected to commence by the end of 2024.
- Phase 2 of the 30,000-tonne per annum IS project is in the machinery installation stage, with completion anticipated by the end of 2024.
Annual Capacity Estimates
By the end of each financial year, the estimated annual capacity is as follows:
| Product |
FY2019 |
FY2020 |
FY2021 |
FY2022 |
FY2023 |
FY2024 |
FY2025e |
| Accelerators |
97,000 |
117,000 |
117,000 |
117,000 |
117,000 |
117,000 |
117,000 |
| Insoluble Sulphur |
30,000 |
30,000 |
30,000 |
60,000 |
60,000 |
60,000 |
60,000 |
| Anti-oxidant |
45,000 |
45,000 |
45,000 |
77,000 |
77,000 |
77,000 |
77,000 |
| Total |
172,000 |
192,000 |
192,000 |
254,000 |
254,000 |
254,000 |
254,000 |
About China Sunsine Chemical Holdings Ltd.
Listed on SGX-ST since 5 July 2007, China Sunsine Chemical Holdings Ltd. is a leading specialty chemical producer, known for its production of rubber accelerators, insoluble sulphur, anti-oxidants, and other vulcanising agents. It is the largest producer of rubber accelerators globally and the biggest insoluble sulphur producer in China, catering to over three-quarters of the world’s top 75 tyre makers including Bridgestone, Michelin, Goodyear, and others.
The company has expanded its production capacity in line with the growth of the auto and tyre industries in China, while maintaining stringent environmental protection measures. China Sunsine holds certifications for ISO9001:2008 quality standards, ISO14001:2004 environmental standards, and GB/T28001-2011 occupational health and safety management systems.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should perform their own research and consider consulting a financial advisor before making any investment decisions.
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