Hefei, Anhui – Chinese faux leather maker Anli expects its unaudited net loss in Q1 2020 to range between CNY6m and CNY9m ($0.9m to $1.3m).
This compares to CNY3m net profit in the first quarter of 2019.
At the start of the year, Anli expected to restart production after the Chinese New Year at the beginning of February. But this was postponed to February 15 due to the coronavirus outbreak. Work started again, but the rate of production only gradually picked up. Effective working hours were greatly shortened, said the company’s statement on April 9.
The pandemic has affected upstream feedstock suppliers, downstream clients, the consumer market as well as logistics both in China and internationally, said the statement.
Economies have been halted in most countries and regions with plummeting PU leather demand, said the statement. This was reflected in the sales volume of Anli's faux leather products in Q1 2020. These were 25% lower than the period a year ago.
Anli has been taking prevention and control measures to protect its employees, which added to the operational costs.
Government subsidies counted in the period also fell from CNY4m to CNY3m, said the statement.
Currency conversion: XE.com