Hongbaoli’s 2019 profit surges on reduced revenue

Nanjing, Jiangsu – China’s system house Hongbaoli reported CNY 89m ($12.7m) net profit in 2019, up 207% from 2018. Revenue in 2019 dropped 3.4% to C NY2.4bn.
 
The company’s net profit less non-recurring items jumped 458% to CNY96m, said its annual report in March.
 
Last year crude oil price was at its low point, and the company had a 17.8% drop in its procurement price for feedstock propylene oxide, said the annual report. With its product price pegged to feedstock price, Hongbaoli’s revenue dropped despite of increased sales volume.
 
In 2019 the company’s polyether polyol business generated CNY 14.5bn sales, down by 5.8% from 2018. Revenue from the polyurethane insulation panel business declined by 23% to CNY 13m.
 
Hongbaoli is able to produce 150kT/year polyether systems for rigid foam and 10m m² highly flame-retardant PU panels each year. The annual report claims that a 2014 Chinese national standard curbing the use of organic insulation materials is still strictly implemented in most of China’s provinces.