China Sunsine Chemical Holdings Ltd. · SGX:QES
China Sunsine Chemical — H1 2023 Earnings Presentation
47 slides from China Sunsine Chemical's earnings presentation, Aug 15, 2023
Slide 1: 1H2023 Results Briefing
1H2023 Results Briefing 15 August 2023 CHINA SUNSINE CHEMICAL HOLDINGS LTD. 中国尚舜化工控股有限公司 1
Slide 2: Disclaimer
Disclaimer 2 The information included in this presentation is being provided for information purposes only and does not constitute an offer to sell, or a solicitation of an offer to purchase, securities of CHINA SUNSINE CHEMICAL HOLDINGS LTD. (“CHINA SUNSINE”). This presentation contains certain for
Slide 3: Presentation Outline
3 PRESENTATION OUTLINE Our Company Financial Overview Key Developments Industry Info and Outlook
Slide 4: Our Company
4 Our Company
Slide 5: About CHINA SUNSINE
About CHINA SUNSINE 5 ✔ China’s largest rubber chemicals producer ✔ World’s largest producer of Rubber Accelerators ✔ One of the world’s largest producers of Insoluble Sulphur ✔ Superior product quality and comprehensive product range ✔ Accredited by a strong customer base of top tire makers ✔ Benef
Slide 6: Our Products: Rubber Chemicals
Our Products: Rubber Chemicals 6 Rubber Chemicals are Essential Additives in the production of rubber products
Slide 7: Our Products - Rubber Chemicals
Our Products - Rubber Chemicals 7 Rubber Accelerators Insoluble Sulphur Anti-Oxidants MBT/MBTS/CBS/TBBS/TMTD (IS) TMQ /HTMQ DPG/DCBS …. 6PPD 4010NA
Slide 8: Rubber/ Rubber Chemicals Consumption
Rubber/ Rubber Chemicals Consumption 8 Global Rubber Consumption by Applications Anti-oxidants Industrial Others 2% 2.2% 8% Vulcanizing Footwear agents 2.0% 7% Accelerators 1.7% Non-tire automotive 13% Tyre Rubber 70% www.fortunebusinessinsights.com • By volume, rubber chemicals compose around 6% of
Slide 9: Our Strong Customer Base
Our Strong Customer Base 9 (2006) (1997) (2003) (2006) • Over 1,000 customers globally • Serves more than 3/4 of the global top 75 tyre makers • About 40% output exported
Slide 10: Our Rubber Accelerators Market Share
Our Rubber Accelerators Market Share 10 Group’s market share of accelerators continued to grow throughout the years 40% 36% 33% 33% 33% 34% 33% PRC * 35% 29% 30% 30% 31% 30% 28% 24% 24% 25% 24% 22% 25% 22% 19% 20% 20% 20% Global* 20% 17% 17% 18% (Est.) 14%16% 15% 11% 12% 12% 10% 7% 5% 0% 2008 2009 2
Slide 11: Our Market Leadership Position
Our Market Leadership Position 11 GLOBAL TOP 3 PRC TOP 3 ACCELERATOR PRODUCERS INSOLUBLE SULPHUR PRODUCERS Annual Company Annual Company Capacity 2022 Capacity 2022 China Sunsine 117,000 tonnes China Sunsine 60,000 tonnes 中国尚舜 中国尚舜 Tianjin Kemai 70,00 tonnes Yanggu Huatai 60,000 tonnes 天津科迈 阳谷华泰 Yan
Slide 12: Our Production Bases
Our Production Bases 12 5 production bases in 3 cities Weifang Plant Shanxian • RA: 27,500-tonne • HQ base: - RA: 59,500-tonne - IS: 10,000-tonne - AO: 45,000-tonne • Hengshun New Materials: - IS: Phase I 30,000-tonne Phase II 30,000-tonne (CIP) - MBT: Phase I 20,000-tonne (CIP) • Yongshun New Distr
Slide 13: Financial Overview
13 Financial Overview
Slide 14: Financial Highlights
Financial Highlights 14 RMB ’mln First Half Year Ended 30/06/23 30/06/22 Change Group Revenue 1,729.1 2,022.5 (15%) Gross Profit 412.0 694.0 (41%) Gross Profit Margin 23.8% 34.3% -10.5 pts Profit Before Tax 236.1 470.1 (50%) Profit After Tax 194.6 427.5 (54%) EPS 20.17/ 44.06/ (54%) (RMB cents/SGD c
Slide 15: Revenue Growth
Revenue Growth 15 RMB ’mln 4,500.0 4,000.0 3,725.2 3,825.0 3,500.0 3,283.3 3,000.0 2,738.4 2,691.7 2,500.0 2,333.7 2,077.3 2,036.9 2,000.0 1,859.1 1,695.9 1,729.1 1,500.0 1,000.0 500.0 0.0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 1H23
Slide 16: Revenue (half-yearly)
Revenue (half-yearly) 16 RMB ’mln 2,500.0 2,022.5 1,967.7 2,000.0 1,802.5 1,737.5 1,757.5 1,729.1 1,507.7 1,545.7 1H23 vs 1H22: -15% 1,500.0 1,413.6 1,230.7 1,278.0 1,291.1 1H23 vs 2H22: - 4 % 1,100.7 1,042.6 1,000.0 936.2 500.0 0.0 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H
Slide 17: Rubber Chemical Sales By Region
Rubber Chemical Sales By Region 17 Region 1H2023 FY2022 FY2021 Rest of Asia 28% China 61% 62% 62% Rest of 27%Asia 28% 27% 28% PRC 61% US 2% 2% 3% US 2% Europe 2% 6% 8% 5% 8% Europe 6% Others 3% 1% 2% Others 3% Total 100% 100% 100%
Slide 18: Rubber Chemical Sales By Products
Rubber Chemical Sales By Products 18 IS 8% Product 1H2023 FY2022 FY2021 Accelerators 54% 54% 60% Accelerators IS 27% 8% 8% 8% 54% Anti- Anti-oxidants 37% 37% 30% oxidants 37% 2% Others 1% 1% 2% 8% Others 1% Total 100% 100% 100%
Slide 19: Overall Average Selling Price (ASP)
Overall Average Selling Price (ASP) 19 RMB/Tonne 25,000 21.5K 20.2K 20,000 19.3K 19.1K 19.4K 18.8K 17.4K 17.1K 16.2K 16.0K 17.2K 15,000 15.0K 13.6K 10,000 5,000 0 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 1H23
Slide 20: ASP vs Major Raw Material Price (half-yearly)
ASP vs Major Raw Material Price (half-yearly) 20 RMB/Tonne 25,000 23.3K 22.0K 20.5K 20,000 18.1K 19.9K 18.6K 18.8K 18.5K 17.2K 17.1K 15.4K 14.3K 14.9K ASP 15,000 13.6K 13.6K 10.2K 10.2K 9.7K 9.9K 9.9K Aniline 10,000 8.4K 9.0K 7.1K 6.8K 6.0K 4.8K 6.2K 5.0K 4.9K 5.0K 5,000 0 1H16 2H16 1H17 2H17 1H18 2
Slide 21: Sales Volume
Sales Volume 21 Tonnes 240,000 195,405 200,000 186,153 167,455 169,876 160,000 151,486 135,791 140,476 120,000 114,572 108,973 98,345 99,748 81,371 80,000 60,907 40,000 0 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 1H23
Slide 22: Sales Volume (half-yearly)
Sales Volume (half-yearly) 22 Tonnes 105,000 102,243 99,748 100,000 93,556 95,731 95,000 93,162 90,422 90,000 85,377 85,000 82,078 80,000 77,123 76,320 1H23 vs 1H22 : + 10% 72,872 74,364 75,000 71,257 1H23 vs 2H22 : + 4 % 70,000 67,604 64,534 65,000 60,000 55,000 50,000 1H16 2H16 1H17 2H17 1H18 2H18
Slide 23: Sales Volume by Products
Sales Volume by Products 23 Tonnes 100,000 89,434 80,000 58,058 60,000 46,789 37,599 32,457 40,000 19,906 20,000 0 FY22 1H23 Accelerators Insoluble Sulphure Anti-oxidants Others FY2022 FY20212 1H2023 1H2023 Effective Capacity Utilisation Rate Effective Capacity Utilisation Rate Accelerators 11700 76
Slide 24: Gross Profit
Gross Profit 24 RMB ’mln 1400.0 1200.0 1125.9 1163.9 1046.5 1000.0 788.1 780.8 800.0 567.4 600.3 600.0 547.1 492.0 412.0 400.0 308.0 200.0 0.0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 1H23
Slide 25: Gross Profit (half-yearly)
Gross Profit (half-yearly) 25 RMB ’mln 800.0 694.0 700.0 622.4 600.0 552.3 503.4 488.0 494.2 1H23 vs 1H22: - 41% 500.0 461.0 469.9 1H23 vs 2H22: - 12% 412.0 400.0 358.4 305.1 327.1 292.8 300.0 242.0 241.9 200.0 100.0 0.0 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H22 1H23 • 1H
Slide 26: Net Profit
Net Profit 26 RMB ’mln 700 641.3 642.4 600 506.3 500 388.9 400 341.3 300 220.2 195.2 221.7 218.8 194.6 200 100 76.7 0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 1H23
Slide 27: Net Profit (half-yearly)
Net Profit (half-yearly) 27 RMB ’mln 450.0 427.5 400.0 341.2 350.0 300.0 1H23 vs 1H22: - 54% 266.0 265.2 252.0 241.1 1H23 vs 2H22: - 9% 250.0 214.9 209.6 194.6 200.0 150.0 139.1 131.7 136.4 123.0 100.0 82.6 82.4 50.0 0.0 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H22 1H23
Slide 28: Margins Analysis
Margins Analysis 28 40.0% 34.3% 35.0% 30.4% 30.0% 28.8% 29.0% 28.1% 27.3% 26.5% 26.9% 25.0% 25.7% Gross Profit Margin 25.0% 23.8% (GPM) 18.2% 19.5% 20.0% 17.2% Net Profit Margin 16.8% 14.4% (NPM) 15.0% 12.5% 13.6% 10.6% 10.5%10.9% 11.3% 9.4% 10.0% 8.5% 4.5% 5.0% 2.3% 0.0% FY11 FY12 FY13 FY14 FY15 FY
Slide 29: Margins Analysis (half-yearly)
Margins Analysis (half-yearly) 29 40.0% 35.8% 34.5% 34.3% 35.0% 32.6% 30.6% 31.4% 30.0% 27.7%26.6% 27.8% 25.8% 25.1% 26.1% 25.0% 22.4% 23.2% 22.9% 23.8% Gross Profit Margin 18.8% 21.1% (GPM) 20.0% 16.3% Net Profit Margin 15.1% 13.9% (NPM) 15.0% 12.6% 12.3% 10.7% 10.6% 11.9% 11.3% 8.8% 9.6% 10.0% 7.9
Slide 30: Balance Sheet Highlight
Balance Sheet Highlight 30 30/06/2023 31/12/2022 31/12/2021 Current Assets (RMB’mln) * 3,167.9 3,149.8 2,839.5 Current Liabilities (RMB’mln) 433.5 532.7 747.2 Current Ratio 7.31 5.91 3.80 Shareholders’ Equity (RMB’mln) 3,757.8 3,691.8 3,176.1 D/E ratio 0 0 0 ROE 5% 17% 16% NAV per share (RMB cents)
Slide 31: Key Developments
31 Key Developments
Slide 32: Expansion Projects Completed in recent years
Expansion Projects Completed in recent years 32 Project Completion 30,000-tonne fully-automated and continuous production of Accelerator TBBS at Shanxian: -- Phase I of 10,000-tonne capacity Jan 2019 -- Phase II of 20,000-tonne capacity 1H2020 60,000-tonne Insoluble Sulphur at Chemical Zone in Shanx
Slide 33: Expansion Projects in Progress
Expansion Projects in Progress 33 Project Schedule CapEx Notes 60,000-tonne Insoluble Sulphur • Adopts continuous production method, the highest standard of production technology, which Rescheduled to was developed in-house Phase 2 of 30,000-tonne capacity • Awarded “First Prize of be completed RMB
Slide 34: Annual Capacity
Annual Capacity 34 FY18 FY19 FY20 FY21 FY22 FY23 FY24e Rubber Accelerators 87,000 97,000 117,000 117,000 117,000 117,000 117,000 Insoluble Sulphur 30,000 30,000 30,000 30,000 60,000 60,000 60,000 Anti-oxidants (TMQ & 6PPD) 45,000 45,000 45,000 45,000 77,000 77,000 77,000 Total 162,000 172,000 192,00
Slide 35: Industry Info and Outlook
35 Industry Info and Outlook
Slide 36: China's New Car Sales
China’s New Car Sales 36 in million units 35 20.0% 30 28 28.9 28.1 25.8 26.3 26.9 15.0% 24.6 25.3 25 23.5 22 10.0% 20 5.0% sales 15 13.2 growth yoy 0.0% 10 5 -5.0% 0 -10.0% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 1H23 Source: China Association of Automobile Manufacturers （CAAM) • China is
Slide 37: PRC Vehicle Population
PRC Vehicle Population 37 PRC Motor Vehicle & Car Population In mln units 450 417 395 400 372 348 350 327 319 310 302 279 290 281 300 264 260 250 240 250 217 194 200 172 154 150 137 100 50 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Car Population Motor Vehicle Poluation http://www.gov.cn/sh
Slide 38: Global Car Population
Global Car Population 38 Car ownership per 1000 people in global major auto markets in 2022 In units 900 837 800 759 731 684 700 639 637 612 600 500 472 461 400 363 329 300 269 226 223 219 200 101 100 29 0 Source: www.163.com • Global vehicle population is growing, mainly driven by rising car owners
Slide 39: Tyre Industry Info
Tyre Industry Info 39 PRC Vehicle Tyre Production in million units % The global tyre market size reached 2,321.3 1200 1,114 15 Million Units in 2022. Looking forward, it 965 925 947 926 1000 892 899 856 10 will reach 2,741.2 Million Units by 2028, 832 816 842 818 800 5 exhibiting a growth rate (CAGR
Slide 40: Operating Environment & Industry Outlook
Operating Environment & Industry Outlook 40 • Greater challenges and uncertainties in macro-economic environment, impacted by a variety of factors, such as slower-than-expected eco recovery, interest rate hike, high inflation, complex and worsening US-China relationship, de-coupling of China and Wes
Slide 41: Group's Strategy
Group’s Strategy 41 Production and Sales Equilibrium Higher production leads to higher sales volume, which in turn stimulates even higher production • Our goal - Strive to increase sales volume and strengthen our market leadership position • Expanding capacity to meet the increased demand for our pr
Slide 42: Competitive Strengths
Competitive Strengths 42 - World largest accelerators and China’s biggest IS producer Market Leadership - Our accelerator products capture 33% of PRC market and 22% of global market - Listed in the first batch of “National Champion Manufacturing Enterprise” - Full range of essential rubber chemicals
Slide 43: Listed On SGX Mainboard
Listed On SGX Mainboard 43 SHARE PERFORMANCE • Since IPO, no new share placement and rights issue
Slide 44: Dividend Payment History
Dividend Payment History 44 1: 2 share Net Profit Dividend split in Nov (in RMB ’mln) 2019 (in SGD cents) 700 641.3 642.4 6 5.5 5.5 600 5 506.3 500 4.5 4 388.9 3.5 400 341.3 3 3 3 Net Profit 300 2.5 Dividend 220.2 221.7 218.8 195.2 2 2 200 76.1 106.7 88.3 115.3 99.4 1.5 76.7 1.5 1.5 1.5 100 1 1 1 1
Slide 45: Investment Merits
Investment Merits 45 ✔ Market leadership position and largest market share in rubber accelerators ✔ Strong customer base ✔ Capacity expansion ongoing, focusing on growing sales volume and market share ✔ Strong cash position (cash per share SGD 28.6 cents) with no bank loan ✔ 15-year track record & a
Slide 46: Chairman's Message
Chairman’s Message 46 “China’s economy was gaining momentum and on track to normalised growth in the first half of this year. Auto sales reached 13.24 million units in 1H2023, representing a 9.8% increase year-on-year. The production utilisation rate of tyre manufacturers also improved. The Group wi
Slide 47: Q & A Media/Investor Contact
47 Q&A MEDIA/INVESTOR CONTACT Tong Yiping, CFO, tongyiping@ChinaSunsine.com Jennie Liu, IR Manager, jennie@ChinaSunsine.com 18 Cross Street, #07-08 Singapore 048423 (+65) 6220 6686 www.ChinaSunsine.com
China Sunsine Chemical Holdings — H1 2023 Earnings Presentation on 6ix