The economic situation in China seems to be reflected by the interim results of the largest air separation plant manufacturer Hangzhou Hangyang who recently announced their interim results for 2014.

The operating turnover for the first six months in 2014 is (RMB) 2,603m, an increase of 7.36% as compared to (RMB) 2,425m for the same period in 2013. Net profit attributable to the shareholders has dropped drastically from (RMB) 121.9m in 2013 to (RMB) 44.8m in 2014, representing a decline of 63.24%.

The management explains in the announcement that for the report period, the general domestic economic situation is still harsh, and due to the impact both from insufficient drive of economic growth and adjustment of industry policy, the development of the air separation plant market is weak as expected.

The demand of ASUs from the chemical industry has declined and the market of medium and small scale ASUs has contracted. However, investment in the new coal chemistry has increased, representing opportunities for large scale and very large scale ASUs. The company has won a contract of two sets of 90,000 Nm3/h ASU for Jingneng project.

For the report period, the ASU sector of Hangyang generated an income of (RMB) 1,038m.

On the petrochemical equipment side of the manufacturing business, they have got 12 contracts in the first half of the year with a total contract value of (RMB) 200m.

The company reported that it had achieved a breakthrough in the area of stack gas recovery, having won a tender to recover the methane gas from synthetic ammonia production to manufacture LNG.

For the sector of industrial gas business, Hangyang said that since the downstream industries are gloomy, the demand is also not promising.

The management stated, “To develop the industrial gas business is a long term strategic goal of the company. After the company is listed, we are committed to investment in the industrial gas business. And after years of hard work, the scale of industrial gas business has continued to expand and is now comparable with that of the ASU manufacturing business.”

At the end of the report period, Hangyang has 15 gas companies in operation, contributing (RMB) 1246mi to the total turnover, an increase of 48.35% compared with same period last year. One new gas company was set up during the report period in Zhumadian and will bring along a 40,000 Nm3/h ASU project.