Yingde Gases Group has announced its interim results for the six months ended 30th June 2014, with turnover rising 15% over the comparable period last year, to RMB 3.6bn ($584m).
In addition to a 15.3% rise in turnover, first-half 2014 saw the group register profit attributable to equity shareholders of RMB 407m ($66m). The group remains in a ‘stable position’ with cash at bank and in hand of RMB 666m ($108m).
As of 30th June 2014, Yingde Gases had a total of 61 facilities in operation and a further 38 facilities under development. The total installed capacity amounted to
1,681,300 Nm3/hr in terms of installed oxygen capacity – representing an increase of 25.6% over the corresponding period last year (2013).
During first-half 2014, the group sold over 11,200 million Nm3 of industrial gases, a growth of 30.6% compared with the corresponding period last year. Total sales volume of oxygen, nitrogen and argon product were 5,148 million Nm3, 4,790 million Nm3 and 107 million Nm3, respectively.
Further, it is expected that the total installed capacity will exceed 2,460,000 Nm3/hr by 2016 upon completion of all facilities under development.
Reviewing the interim results, the company commented, “Last year, the global industrial production and trade remained sluggish and world economic growth continued to decline slightly, following by the slowdown in housing market demand in the first half of 2014. Affected by this, China‘s growth in domestic demand for industrial products is weak, and the overcapacity situation of China’s steel industry did not improve significantly.”
“[The] Macroeconomic environment is expected to remain flat in the second half of 2014, while the demand for industrial gases remain stable.”
Growing market share
According to figures last year, the Yingde Gases Group had further increased its share in the onsite gas supply market in 2013, reaching a high of 46.8% (2012: 40.9%) and becoming the largest independent onsite industrial gas supplier in China.
This is a position that the group has further consolidated so far in 2014, with its interim results suggesting that for the six months ended 30th June 2014 the turnover of our group’s onsite gas operations amounted to RMB 3.262bn ($529m) – an increase of 15.1% compared with the corresponding period last year.
Onsite gas supply continued to account for around 88% of the turnover of Yingde Gases in first-half 2014, mainly contributed by customers from the steel, chemical and non-ferrous metals industries.
When it comes to Yingde’s merchant gas operations, heavy investment in this area in recent years saw first-half 2014 turnover rise 16.9% over the same period last year, to RMB 411m ($66m approx.). The percentage of merchant sales accounting for the turnover of the group remains at 11.2%.
Looking forward, Yingde Gases remains confident in its future performance, despite what it describes as a ‘dampened industrial gas market’, and is focusing on expanding its merchant market business while maintaining its already strong foothold in the onsite sector.
A company statement explained, “Despite the dampened industrial gas market in the weakening global economy and the slowdown of China’s economic growth in 2014, particularly with the unstable performance in the retail market, our group remains confident in the future market performance.”
“Our group will closely monitor the market and identify more quality customers. While maintaining the on-site gas supply business, our group will be more aggressive in securing customers in the merchant market so as to generate greater returns to the shareholders.”