Hong Kong — International flexible foam maker Sinomax has issued a second warning as profits are expected to be around 40% lower in 2016 than in 2015.
The company said that the fall was due to costs in setting up its US subsidiary in Tennessee and because of operational losses at its Dormeo North America subsidiary.
Weak consumer demand in Hong Kong and China and price increases for raw materials in the fourth quarter of 2016, also made trading difficult, the company added.
Sinomax said in a Hong Kong Stock Market announcement that the profit warning is based on unaudited data and that it expects to publish the final numbers for the year on 28 March 2017.
The company issued its first profit warning for the 2016 financial year in August 2016.