China Sunsine Chemical Holdings Ltd. · SGX:QES
China Sunsine Chemical — FY2023 Earnings Presentation
47 slides from China Sunsine Chemical's earnings presentation, Mar 4, 2024
Slide 1: 2H2023 & FY2023 Results Briefing
2H2023 & FY2023 Results Briefing 4 March 2024 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 ✔ A sizable anti-oxidants producer ✔ Superior product quality and comprehensive product range ✔ Accredited by a strong custo
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 (including prominent players : Bridgestone, Goodyear, Michelin etc.) • 1/3 output exported
Slide 10: Global Largest Accelerators Producer
Global Largest Accelerators Producer 10 Group’s market share of accelerators 40% 36% 35% 33%33% 33% 34% 33% 35% 29%30% 30% 31% PRC * 30% 28% 24% 24% 25% 24% 22% 23% 25% 22% 19% 20%20%20% Global* (Est.) 20% 16% 17% 17% 18% 14% 15% 11% 12% 12% 10% 7% 5% 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016
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 2023 Capacity 2023 China Sunsine 117,000 tonnes China Sunsine 60,000 tonnes 中国尚舜 中国尚舜 Tianjin Kemai 70,000 tonnes Yanggu Huatai 60,000 tonnes 天津科迈 阳谷华泰 Ya
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 (by end of 2024) - MBT: Phase I 20,000-tonne (by 2H2024) • Y
Slide 13: Financial Overview
13 Financial Overview
Slide 14: Financial Highlights
Financial Highlights 14 RMB ’mln 6 Months Ended 12 Months Ended 31/12/23 31/12/22 Change 31/12/23 31/12/22 Change Group Revenue 1,761.3 1,802.5 (2%) 3,490.4 3,825.0 (9%) Gross Profit 386.9 469.9 (18%) 798.9 1,163.9 (31%) Gross Profit Margin 22.0% 26.1% (4.1 pts) 22.9% 30.4% (7.5 pts) Profit Before T
Slide 15: Revenue Growth
Revenue Growth 15 RMB ’mln 4,000.0 3,725.2 3,825.0 3,490.4 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 1,500.0 1,000.0 500.0 0.0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 • FY2023 revenue down 9% yoy due to lower Average Selling Price
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 1,761.3 1,737.5 1,757.5 1,729.1 1,507.7 1,545.7 1,500.0 1,413.6 2H23 vs 2H22: -2% 1,230.7 1,278.0 1,291.1 2H23 vs 1H23: +2% 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 1H
Slide 17: Rubber Chemical Sales By Region
Rubber Chemical Sales By Region 17 Region FY2023 FY2022 FY2021 Rest of Asia 29% China 60% 62% 62% PRC Rest of 27%Asia 29% 27% 28% 60% Europe 6% 8% 5% US 2% 2% 2% 3% Europe 6% 8% Others 3% 1% 2% US 2% Total 100% 100% 100% Others 3%
Slide 18: Rubber Chemical Sales By Products
Rubber Chemical Sales By Products 18 IS 8% Product FY2023 FY2022 FY2021 Accelerators 57% 54% 60% Accelerators IS 27% 8% 8% 8% 57% Anti- Anti-oxidants 35% 37% 30% oxidants 35% 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 16.7K 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 FY23
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 19.9K 18.6K 18.8K 18.5K 18.1K 17.1K 17.2K 16.2K ASP 15.4K 14.3K 14.9K 2H23 vs 2H22: -13% 15,000 13.6K13.6K ASP 2H23 vs 1H23: - 9% 10.2K 10.2K 9.7K 9.9K 9.9K 10.1K 10,000 8.4K 9.0K 7.1K Aniline 6.8K 6.0K 4.8K 6
Slide 21: Sales Volume
Sales Volume 21 Tonnes 240,000 Historical 206,996 high 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 80,000 40,000 0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 • Sales volume reached record high in FY2023 due to: - more orders acqu
Slide 22: Sales Volume (half-yearly)
Sales Volume (half-yearly) 22 Tonnes 115,000 110,000 107,248 105,000 102,243 99,748 100,000 95,731 93,556 93,162 95,000 90,422 90,000 85,377 82,078 2H23 vs 2H22 : + 12% 85,000 77,123 2H23 vs 1H23 : + 8% 80,000 76,320 75,000 72,87274,364 71,257 70,000 67,604 64,534 65,000 60,000 55,000 50,000 1H16 2H
Slide 23: Sales Volume by Products
Sales Volume by Products 23 Tonnes 120,000 99,809 100,000 89,434 80,000 58,058 65,127 60,000 40,655 37,599 40,000 20,000 0 FY22 FY23 Accelerators Insoluble Sulphure Anti-oxidants Others FY2022 FY2022 FY2023 FY2023 Effective Capacity Utilisation Rate Effective Capacity Utilisation Rate Accelerators 1
Slide 24: Gross Profit
Gross Profit 24 RMB ’mln 1400.0 1200.0 1125.9 1163.9 1046.5 1000.0 788.1 780.8 798.9 800.0 567.4 600.3 600.0 547.1 492.0 400.0 308.0 200.0 0.0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 • FY23 Gross profit down 31% yoy due mainly to lower ASP
Slide 25: Gross Profit (half-yearly)
Gross Profit (half-yearly) 25 RMB ’mln 800.0 694.0 700.0 622.4 600.0 552.3 503.4488.0 494.2 2H23 vs 2H22: - 18% 500.0 461.0 469.9 2H23 vs 1H23: - 6% 412.0 386.9 400.0 358.4 305.1327.1 292.8 300.0 242.0 241.9 200.0 100.0 0.0 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H22 1H23 2
Slide 26: Net Profit
Net Profit 26 RMB ’mln 700 641.3 642.4 600 506.3 500 388.9 372.4 400 341.3 300 220.2 195.2 221.7 218.8 200 100 76.7 0 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23
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 2H23 vs 2H22: - 17% 266.0 265.2 252.0 241.1 2H23 vs 1H23: - 9% 250.0 214.9 209.6 194.6 200.0 177.8 150.0 139.1131.7 136.4 123.0 100.0 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% 22.9% (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% 9.4% 10.7% 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% 23.2% 22.9% 23.8% Gross Profit Margin 22.4% 22.0% 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.
Slide 30: Balance Sheet Highlight
Balance Sheet Highlight 30 31/12/2023 31/12/2022 31/12/2021 Current Assets (RMB’mln) * 3,314.8 3,149.8 2,839.5 Current Liabilities (RMB’mln) 459.2 532.7 747.2 Current Ratio 7.22 5.91 3.80 Shareholders’ Equity (RMB’mln) 3,926.6 3,691.8 3,176.1 D/E ratio 0 0 0 ROE 9% 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 To be was developed in-house Phase 2 of 30,000-tonne capacity • Awarded “First Prize of completed by RMB 100 mln e
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: PRC New Car Sales
PRC New Car Sales 36 in million units 35 20.00% 30.1 30 28.9 28.1 28 15.00% 26.3 26.9 25.8 25.3 24.6 25 23.5 22 10.00% 20 5.00% Total Car Sales 15 NEV Sales 0.00% Car Sales yoy growth 10 5 -5.00% 0 -10.00% 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Source: China Association of Automobile
Slide 37: PRC Vehicle Population
PRC Vehicle Population 37 PRC Motor Vehicle & Car Population In mln units 500 450 417 435 395 400 372 348 336 350 310 327 319 290 302 300 264 279 281 250 260 240 250 217 194 200 154 172 137 150 100 50 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Car Population Motor Vehicle Poluation Sou
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 639637 612 600 500 472 461 400 363 329 300 269 226 223 219 200 101 100 29 0 Automotive Tire Market - Size & Share - Automobile Industry Report Source: www.163.com (mordori
Slide 39: Tyre Industry Info
Tyre Industry Info 39 PRC Vehicle Tyre Production in million units % The global tyre market reached a total of 2,388 1200 1,114 20 965 925 947 926 988 million units in 2023. Looking ahead, it is 1000 892 899 856 15 832 816 842 818 expected to grow further, reaching 800 10 approximately 3,012 million
Slide 40: Operating Environment & Industry Outlook
Operating Environment & Industry Outlook 40 • Greater challenges and uncertainties in the macro-economic environment, such as high interest rate, the Ukraine-Russia conflict, conflict in Gaza, the Red Sea Crisis, rising geopolitical tensions between the US and China, and weakening international trad
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 - Increase market share and strengthen our market leadership position • Expanding capacity to meet the increased demand for our products • I
Slide 42: Competitive Strengths
Competitive Strengths 42 - World largest accelerators and China’s biggest IS producer Market Leadership - Our accelerator products capture 35% of PRC market and 23% 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 split in Nov Dividend (in RMB ’mln) 2019 (in SGD cents) 700 641.3 642.4 6 5.5 5.5 600 5 506.3 500 4.5 4 388.9 372.4 3.5 400 341.3 3 3 3 Net Profit 300 2.52.5 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
Slide 45: Investment Merits
Investment Merits 45 ✔ Market leadership position and largest market share in rubber accelerators ✔ Strong customer base ✔ Strong corporate governance & transparency ✔ Capable and reliable management team ✔ Capacity expansion ongoing, focusing on growing sales volume and market share ✔ Strong cash p
Slide 46: Chairman's Message
Chairman’s Message 46 “Despite the various turbulent international situations and intense domestic competition, I am pleased that the Group achieved a satisfactory set of results in FY2023. Entering into FY2024, China's auto market remains robust, Chinese tyre makers’ production utilisation rate app
Slide 47: Q & A
47 Q&A MEDIA/INVESTOR CONTACT Tong Yiping, CFO, tongyiping@ChinaSunsine.com Jennie Liu, IR Manager, jennie@ChinaSunsine.com 16 Raffles Quay #15-08 Hong Leong Building, Singapore 048581 Tel:(65) 6220 6686 www.ChinaSunsine.com
China Sunsine Chemical Holdings — FY2023 Earnings Presentation on 6ix