The company and the controlling shareholder China Pingan Shenma Group, as well as its subsidiaries and associated companies, have a nylon industrial chain. The market share at home and abroad leads and the downstream customers are superior. The company and the controlling shareholder China Pingan Shenma Group, as well as its subsidiaries and associates The company already has a relatively complete nylon 66 industrial chain, including refined benzene, adipic acid, hexamethylene diamine and nylon 66 salt and downstream nylon 66 section, cord fabric, industrial yarn series products. Through the parent company and INVISTA signed a long-term contract guarantee Adiponitrile feedstock supply. Production capacity of companies and joint stock companies: The company has a nylon chip production capacity of 140,000 tons/year, an industrial yarn production capacity of about 120,000 tons/year, and a cord fabric production capacity of about 80,000 tons/year; 49% of equity) has 140,000 tons/year of hexamethylene diamine, 250,000 tons/year of adipic acid, and 300,000 tons/year of nylon 66 salt.
Nylon 66 salt as the main raw material, its purchase price and the average price of product sales has a greater impact on the company's profits. The company’s announcement shows that the average annual purchase price of nylon 66 salt in 2017 was 12,591 yuan/ton, an increase of 30.64% year-on-year. The annual sales price of nylon 66 industrial yarns, cords, and slivers were 14.13%, 12.41%, and 29.56% year-on-year, respectively. The increase in raw material prices was higher than the increase in product prices, and the profit was squeezed. In 2018 Q1 nylon 66 salt average The purchase price was RMB 12,588/ton, which was a year-on-year increase of 0.7%. During the same period, the average selling price of nylon 66 industrial yarn, cord fabrics and chips increased by 12.82%, 1.84%, and 17.45% year-on-year, respectively. The larger increase, the profit margin expanded.
Due to the tight supply and demand of adiponitrile, the major products in the industrial chain have increased significantly. The performance of nylon chemical companies in the participating companies has greatly increased, and the company’s investment income has been huge. The production capacity of adiponitrile has encountered force majeure and the supply and demand are extremely tight. Adiponitrile, hexamethylenediamine and nylon 66 have been raised. In recent years, Solvay France's Chalamp adiponitrile unit, BASF's hexamethylene diamine unit and INVISTA's US plant (including adiponitrile, adipic acid, KA oil, and hexamethylene diamine) have become force majeure, and the supply of hexamethylene diamine has increased. Tight phenomenon continues to ferment. According to the chemical online data, the price of hexamethylene diamine has increased by 109.4% since the beginning of 2018, the latest market price is 58,000 yuan/ton; the price of nylon 66 chips (filament grade) has increased by 24.6%, and the latest market price is 32,400 yuan/year. Ton, the price increase of industrial chain products, the elasticity of nylon chemical performance of the company and the participating companies increased, and the company’s investment income increased significantly. The company’s investment income from associates in 2017 was 90.7161 million yuan, accounting for 59.09% of the total profit for the current period. The investment income from the joint venture Nylon Chemicals was 63.8279 million yuan. In addition, as the company signed an agreement with INVISTA, the company’s raw material, adiponitrile, was Vectra offers, contract price increases last year are still priced at a relatively low cost of raw materials, and therefore benefit from hexamethylene diamine, nylon 66 and other prices, the company's products and raw materials increased spreads, profits further enhanced.
Although in August 2017 the company announced that it had failed to restructure its nylon chemical industry, the group promised to continue to promote the injection of nylon chemical assets into the listed company. If successful, the company's performance will go up again. Once the nylon chemical company exceeded the boiler discharge, insufficient fire separation, etc. The restructuring of major assets of listed companies and nylon chemicals was terminated. After rectification, nylon chemicals passed the rectification acceptance of the Municipal Environmental Protection Bureau in July 2017, and a new safety production license was obtained in September of the same year. Therefore, we believe that nylon chemical assets are injected. Listed companies are still available, while the company currently holds 49% of the shares in nylon chemicals and enjoys investment income. Once the asset injection is completed, nylon chemicals will be consolidated. The company's performance is expected to increase substantially and it will fully benefit from the growth in nylon chemical performance. .