Pipe extruder Liansu plans more expansion in China

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: August 21, 2012 6:00 am ET

Related to this story

Topics Construction, Pipe/Profile/Tubing

HONG KONG (Aug. 21, 1:50 p.m. ET) — China Liansu Group Holdings Ltd., the country’s largest plastic pipe maker, plans a significant expansion to meet growing domestic demand, with new factories slated for Hainan, Yunnan, Shandong and Guangdong provinces.

Liansu disclosed the investments in an earnings report filed August 20 with the Hong Kong stock market, where it said that sales increased 5.6 percent in the first half of the year, to 4.81 billion Chinese yuan (US$726.2 million), while profit was up 11.6 percent, to 598 million Chinese yuan (US$94.0 million).

That’s actually significantly slower sales growth than the 31 percent the firm saw in 2011, a result of tougher conditions in China this year and the government’s decision last year to tighten credit and slow the housing market.

But the company said overall prospects for plastic pipe remain good, pushed by China’s general trends toward increased urbanization, construction of affordable housing, investments in water conservation and revamping of outdated pipe networks.

Liansu, based in Foshan, Guangdong province, did not provide details of the additional expansion in its filing but said the four facilities are part of a “new phase of capacity expansion… to ensure that the market demands are being met.”

The company said it expects to have production capacity between 1.65 million and 1.75 million metric tons by the end of the year. In recent years it has been expanding heavily beyond its base in Guangdong.

“Stable growth in the demand for plastic pipes is still expected given further advancement of China’s industrialisation, urbanisation and informatisation, further expansion of domestic demand and ongoing implementation of major construction projects in affordable housing, urban infrastructure and new agricultural villages,” the company said. “The Group is fully confident that it will enjoy sound and stable business development in the second half of 2012.”

The company said it was able to maintain profit growth in spite of the sales slowdown because it maintained cost controls, adopted an “optimized” pricing strategy and attracted new customers.

The volume of pipe and fittings sold rose 9.1 percent in the first half of the year, compared to the same period in 2011, to 470,000 metric tons, even as average selling prices fell, Liansu said.

Other focuses for the immediate period include expanding its national sales network and trying to better tap international markets, along with continuing to diversify into related plastic construction products such as plastic-steel doors and windows and kitchen and sanitary products, the company said.


Comments

Pipe extruder Liansu plans more expansion in China

By Steve Toloken
Staff Reporter / Asia Bureau Chief

Published: August 21, 2012 6:00 am ET

Post Your Comments


Back to story


More stories

Image

ADS launches public trading on NYSE

July 25, 2014 10:41 am ET

Advanced Drainage Systems, the world's largest producer of thermoplastic corrugated pipe, made its debut on the New York Stock Exchange today with 14....    More

Image

Injection molder, recycler Polyvulc USA puts itself up for sale

July 24, 2014 12:41 pm ET

Fred Farrell and Larry Lambiotte, founders of Polyvulc USA Inc. and its subsidiaries Polyvulc Tire Recycling Llc and Winnsboro Rubber Recycling LLC,...    More

Image

Plastics industry blasted for stance in green building debate

July 22, 2014 2:45 pm ET

The plastics industry has taken high-profile stance in the debate over green building standards. The result, today at least, is that it's getting...    More

Image

Belgian floor covering company building $200 million US plant

July 15, 2014 12:10 pm ET

Belgium-based flooring company Beaulieu International Group will build a manufacturing plant in Cartersville, Ga., giving the business its first U.S. ...    More

Image

ADS moving closer to IPO, expects share price of $17 to $19

July 14, 2014 12:22 pm ET

Plastics water pipe maker Advanced Drainage Systems Inc. (ADS) announced terms today for its initial public offering, which will put 14.5 million shar...    More

Market Reports

Injection Molders Market Report & Ranking 2014

This special package contains our 132-page 2014 Market Report on the Injection Molding segment and our exclusive 2014 RANKINGS database of 500+ Injection Molders for a discounted package price.

Learn more

Plastics Recycling Market Review & Outlook 2014

This special report from Plastics News examines the North American plastics recycling industry and provides insight into indicators that impact market viability, including Resin pricing trends for virgin and recycled market material and historical Resin production trends for post- consumer and industrial waste.

Learn more

Shale Gas Market - Analysis of North American Region

This report highlights the impact of shale-based natural gas on the North American plastics market and features an in-depth analysis of production trends in the United States during 2013 and a forecast for 2014 and beyond.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events