NINGBO, CHINA (March 19, 5:05 p.m. ET) — The slowing Chinese economy put a dent in high-flying injection molding machine maker Haitian International Holdings Ltd., keeping profit and sales flat for 2011. But the Chinese firm reported that surging exports offset the tougher situation at home.
The Ningbo-based plastic equipment manufacturer said March 19 that 2011 sales were 7.027 billion Chinese yuan (US$1.11 billion), about even with 2010's record high, with profit of 1.103 billion yuan (US$175.2 million), up 4 percent from 2010 and setting a new record.
It's a big change from 2010, when the company saw sales and profit rise at least 80 percent as China's economy boomed to the point of overheating. But Haitian said it was satisfied with the 2011 results considering the global economic problems.
Haitian, China's largest press maker and one of the world's largest, said that while markets are volatile, its economic outlook is improving from a low point in late 2011. It attributed that in part to the People's Bank of China stepping back from its tight monetary policy and indications of a financial bailout for the Greek government.
“It is unrealistic to expect that the European sovereign debt crisis, the Chinese tightening monetary policies and looming concerns over the growth in [the] global economy can be entirely eased in the short-term,” Haitian said. “However, we already note some positive signals from the market in the beginning of 2012. … Our order level is gradually picking up from the trough of the end of 2011.”
Haitian said its domestic Chinese sales for 2011 dropped 7.2 percent, to 4.854 billion yuan (US$771.2 million), while export sales rose 17.3 percent, to 1.992 billion yuan (US$316.4 million).
It sees strong potential for continued export growth and is beefing up support for overseas markets, including setting up a team dedicated to multinational customers.
As well, the company said it plans to introduce new versions of its Mars, Venus and Jupiter models in the second half of 2012.
Haitian sold 27,000 injection machines in 2011, compared with 30,000 in 2010, but said the average selling price in 2011 increased 10 percent to 253,000 yuan (US$40,200), reflecting an increase in sales of medium- and large-tonnage machines and more technologically advanced presses.
Sales of its Mars machine, which has become its mainstay product, grew 7 percent overall to 5.163 million yuan (US$820.3 million), while sales of its newer, all-electric Venus models grew 77 percent, to 305.2 million yuan (US$48.4 million).
In general, the company claimed it weathered the difficult 2011 conditions in China's market better than industry peers, and said it continues to focus on research and development.
For example, it launched a MuCell micro-cellular foaming system in China with American firm Trexel Inc., and won two second-prize Chinese National Science and Technology Progress awards for developments in 2011, the highest awards the company has won in its history. That marked the first time that award was given to a plastic injection molding machinery maker in China, Haitian said.
Haitian officials also said they have purchased 3.7 acres of land in Germany to expand their Zhafir Plastics Machinery subsidiary, which is headquartered in Ebermannsdorf, Germany, and are proceeding with an expansion of Zhafir's production in Ningbo, which will increase production of the Venus machines from about 80 a month to at least 120.