Hong Kong – Sinomax has warned investors that post-tax profit may be down by 90% in 2018. Raw materials, tariffs and startup costs in the US hit performance.
Profit warning from Sinomax as tariffs, costs bite in 2018
The company said unaudited figures show pre-tax profits are likely to be HK$27-28m ($3.4-3.6m), a fall of between 51% and 53%. After tax, the losses are magnified, and profit at this level could be between HK$3m and HK$5m.
Once again, costs incurred in trial runs of the company's plant in Tennessee were blamed for the change in profitability. The costs of recruiting sales staff was also partially to blame.
In addition, the company said that the high cost of TDI in 2018 compared with 2017, and the imposition of tariffs on goods from China to the US, hit the numbers.
Sinomax stressed that these are preliminary numbers, and that they are yet to be audited. Annual results are expected in late March.
Currency conversion: XE.com
