In the first half of the year, Lee & Man Paper (02314) net profit fell 43.62% to 1.68 billion yuan, with an interim dividend of 0.13 yuan per share, down 35% year-on-year
CEO Li Wenbin said that the Sino-US trade wars continue to affect the demand of China’s paper industry. At present, the market has been oversupplied and there is no obvious recovery trend this year.
Lee & Man Paper (centre) of Lee & Man Paper believes that the Chinese market demand is expected to recover after the end of the trade war. Right is the managing director Li Jingwei.
As of the end of June, Lee & Man Paper’s revenue was 12.946 billion yuan, down 20.9% year-on-year. During the period, the company’s total sales volume was 2.81 million tons, and its net profit per ton fell to 597 yuan from 797 yuan at the end of last year.
Li Wenbin explained that in the first eight months of this year, the order volume of packaging paper in the Chinese market has been reduced by about 25%, and the price trend of paper has also declined. Among them, the price per ton of packaging paper in July and August has dropped by 50 to 60 yuan.
Second half or slight increase
He continued that the company had tried its best to start production in the first half of the year in order to maintain the corresponding output, so the price of the product fell. In the second half of the year, the traditional peak season for the paper industry, the demand is expected to increase compared with the first half of the year, and the company may raise the price of the product by a small margin.
He also pointed out that the company will speed up the layout in Southeast Asia. At present, Vietnam’s plants account for about 10% of the overall sales. The company is actively expanding its local production capacity. Its new packaging paper production line is expected to be put into operation at the end of next year. It is expected to increase annual production capacity by 500,000. Ton. As the company’s production capacity in Vietnam gradually expands, it is expected that the performance will improve.
In addition, the company currently has about $4.2 billion in cash on hand and will actively monitor the acquisition opportunities for overseas projects. However, he stressed that it will not reduce the dividend payouts due to investment and acquisition projects, and will maintain a dividend payout ratio of 30 to 35% in the future.
Cultural and cultural workers’ net profit shrinks by 26%
In addition, the same period of the same period, the net profit of the same cultural staff (00746) also fell, recording 401 million yuan, down 26.43% year-on-year, and interim dividend of 0.18 yuan. The company said that in response to global economic uncertainty, a series of open source and cost-saving measures will be taken, including increased investment in production automation; and will enrich its product categories, such as commercial hydrogen has begun to sell in the third quarter.