Hunan Kaimeite Gases Co. Ltd announced its 2015 interim results with a drastic drop in both revenue (-77.8%) and profit.

Operating revenue plunged to just RMB 27.6m ($4.3m) for the first six months of 2015, from RMB 124.8m ($19.6m) for the same period last year.

Meanwhile, profit attributable to shareholders of the listed company showed a loss of RMB 31.2m ($4.9m) – a 212% loss compared with the same period last year. This deepens even further to a loss of 229% if non-recurring profit and loss is deducted from the calculation.

Even a 10.7% decrease in operating costs could not arrest such a slide.

The management of Kaimeite Gases explained in a statement that the loss was due to the continuation of the downward pressure of the domestic economy, coupled with many difficulties and challenges.

In addition, the suspension of operation of Changling Kaimeite Gases, the substantial drop in the market price of the products of Anqing Phase II, and the increase in the management costs during the construction of its Hainan and Fujian projects were also cited as factors leading to the slide in profit.

The RMB 76m ($11.9m) loss in revenue is described as the result of the commercial negotiation with the Changling branch company of Sinopec for the new agreement on the clearance price and the mode of clearance of the fuel gas. The agreed figure is recorded as a discount in sales rather than a bad debt.

Breaking down the results by products, Kaimeite Gases saw liquid carbon dioxide, dry ice, and argon show increases in revenue, whereas revenues from oxygen and nitrogen, hydrogen, LPG and butane all showed substantial falls (see table below).

 ProductRevenue – First Six Months 2015 (RMB)   Percent Change vs Same Period of 2014
Liquid carbon dioxide              67.5m  +21.9%
Dry ice  3.4m  +6%
Oxygen and nitrogen  2.2m  -61.5%
Argon  2.8m  +279.6%
Hydrogen  11.7m  -43.3%
LPG  10.9m  -63.1%
Butane  5.2m  -44.3%

Trading of the shares of the company has been suspended since April 2015.