HAIK31 Jul 2012 21:28
Trading Update
HaiKe Chemical Group Limited ("HaiKe" or the "Company"), the AIM quoted (AIM: HAIK) petrochemical, specialty chemical and biochemical business based in China, today provides an update on trading ahead of its interim results for the six months period ended 30 June 2012.
The following represent the key points in the Company's trading performance:
· The Company recorded slight turnover growth year-on-year in 1H, mainly driven by a price increase in the refinery division. Nevertheless, diesel sales volume fell by 15% year-on-year as a consequence of the weakening economy. The refinery division made a gross profit but a net loss in 1H 2012.
· Both specialty and salt chemicals recorded volume increases in 1H, however prices have fallen as a result of a sluggish domestic economy. Both Dongying Hi-Tech Spring Chemical Co., Ltd. ("Hi-Tech Spring") and Shandong Hi-Tech Shengli Electrochemical ("Hi-Tech Shengli") remained profitable. Biochemicals recorded a strong increase in sales and generated its largest profit yet.
· Dongying Hebang Chemical Co., Ltd. ("Hebang"), which produces specialty and salt chemical products, commenced commercial operation in late March of this year. The sale of its first product, Trichloroethylene ("TCE"), was disappointing in 2Q due a reduction in market demand. Hebang is currently breaking even at the gross margin level. New products, including caustic soda, come on stream later this year and are expected to improve Hebang's performance.