Nantong, Jiangsu – Chinese polyurethane mattress and pillow maker Healthcare Co. reported CNY 156m ($25m) net profit in 2017. This was down by 22% from 2016.
The company’s sales, however, jumped 36% to CNY 2.3bn, according to its annual report. Reasons for the gap between rising sales and falling profits include rising raw material prices. A 50% increase in prices for MDI and a 70% rise for TDI hit profits, Healthcare said.
Last year Healthcare filed an antitrust lawsuit against four of China’s TDI makers. China's legal system accepted the lawsuit for trial in March, as UTECH-polyurethane.com reported at the time.
In 2017, the company sold 3 m mattresses and nearly 10 m pillows, both as an OEM manufacturer and under its own label, Mlily. Its mattress business had a 30% gross margin, down by 8% from 2016. Its pillow business saw a 27% gross margin, down by 2%.
Exports accounted for 82% of Healthcare’s total revenue last year, and generated a 26% gross margin. This compares with a 43% margin for the domestic market.
The company's Mlily brand has a CNY 465m project to install Laader Berg machinery at its facility. That’s expected to have 1.5m unit/year mattress capacity and 3.6m unit/year pillow capacity when in full operation.
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