Large polyester industrial yarn factories: diversified revenue and net profit in 2024

Recently, listed companies have announced their annual reports for 2024. At present, there are mainly four large polyester industrial yarn factories in China's A-share listed companies, namely Hengli Petrochemical, Unifull, Hailide and Sanwei. Among them, Hengli's polyester industrial yarn capacity ranks first in the industry, but Hengli's business is relatively wide, and polyester industrial yarn accounts for a small proportion. Therefore, taking Unifull, Hailide and Sanwei as examples, a simple analysis of the financial report data was made. Among them, polyester industrial yarn accounted for about 75% of Unifull's operating income, polyester industrial yarn took up 47% of Hailide's operating income, and polyester chemical fiber (including PET fiber chip and polyester industrial yarn) occupied 33% of Sanwei's operating income.

Operating income

In 2024, the operating income of the three enterprises was divided year-on-year, with Unifull declining year-on-year, while Hailide and Sanwei increased year-on-year. There were two main factors affecting operating income, namely, selling price and sales volume.

In 2024, under the influence of factors such as geopolitical conflict, "OPEC +" production increase, demand concern and financial market atmosphere, the price of crude oil rose at first, declined later and then shivered. In 2024, the average prices of WTI and Brent crude oil futures were USD75.76/bbl and USD79.85/bbl respectively, down 2.4% and 2.8% respectively compared with 2023. Therefore, dragged down by the downward cost, the prices of each product of polyester industry chain decreased year-on-year in 2024. According to data from CCFGroup, in 2024, the average price of bright PET fiber chip was 6,660yuan/mt, down 162yuan/mt year-on-year, with a year-on-year decrease of 2.4%; the average price of ordinary high-tenacity 1000D/192F polyester industrial yarn was 8,423yuan/mt, down 403yuan/mt year-on-year, with a decrease of 4.6%. Therefore, in 2024, the selling price of polyester fiber industry among the main products of Hailide, Unifull and Sanwei decreased compared with that in 2023.

According to the sales volume and operating income data of the main products of the three enterprises in 2024, it could be seen that the sales volume of polyester industrial yarn and special textiles in Unifull's main products increased by -15.98% and 18.44% respectively on a year-on-year basis, while the operating income increased by-16.84% and 17.48% respectively on a year-on-year basis, which indicated that the unit price of these two types of products fell year-on-year. Among them, the proportion of polyester industrial yarn was much larger than that of other products. The year-on-year reduction of operating income in Unifull in 2024 was mainly because the selling price and sales volume of PIY both declined. Among the main products of Hailide, the sales volume of polyester industrial yarn and tire cord fabric increased significantly year-on-year, and the growth rate of sales volume was higher than the growth rate of operating revenue. Therefore, the main reason for the year-on-year increase in the total operating revenue of Hailide in 2024 was the substantial increase in sales volume. As for Sanwei, the operating revenue of the polyester chemical fiber segment reduced year-on-year, mainly due to the decline in both selling price and sales volume. However, due to the improvement of sales ratio of products in other industries of Sanwei, especially the substantial increase of sales volume of BDO and derivatives, the operating income increment of .566 billion yuan was brought about, making the total operating income of Sanwei increase by 32.31% year-on-year in 2024.

Net profit

Seen from the net profit in 2024, Hailide was the only profitable enterprise among the three enterprises, and the net profit increased by 17.58% year-on-year; although Unifull's net profit performance was loss, the losses were significantly narrower than that in 2023; the net profit of Sanwei was at 148 million yuan in 2023 and the losses were at 147 million in 2024, with a particularly large year-on-year decline. However, as for the sales gross profit rate, Only Unifull saw a year-on-year growth, and Hailide slightly decreased. Sanwei witnessed a big reduction. Therefore, the year-on-year performance of gross profit rate and net interest rate was different in these three enterprises. In fact, in addition to gross profit, the factors affecting the net profit of the parent company also included other kinds of income, other operating costs, non-operating income and expenditure, income tax expenses and minority shareholders' profits and losses, while the factors affecting the gross profit were operating income and gross profit rate.

In 2024, although the sales gross profit margin of Hailide was 16.04%, a slight decrease of 0.14% compared with 16.18% in 2023, due to a year-on-year increase in operating revenue of 4.96%, the total gross profit increased year-on-year. Coupled with the increase in various other revenues, the net profit attributable to the parent company increased significantly year-on-year. In 2024, although the operating revenue of Unifull decreased by 11.45% year-on-year, the sales gross profit margin increased to 7.21%, a substantial increase of 2.67% compared with 4.54% in 2023. Therefore, the gross profit rose year-on-year and the company was profitable, which led to an improvement in the net profit attributable to the parent company of Unifull. However, due to the relatively high other operating costs of Unifull, the net profit attributable to the parent company showed a loss. Nevertheless, the other operating costs decreased year-on-year, so the loss margin narrowed. In 2024, although the operating revenue of Sanwei increased significantly by 32.31% year-on-year, the sales gross profit margin dropped sharply from 13.47% in 2023 to 7.81% in 2024, resulting in a year-on-year decrease in gross profit. Coupled with the change of various revenues from profitability to loss, the net profit attributable to the parent company also changed from profitability in 2023 to loss in 2024, with a significant year-on-year decrease of about 199%.

In terms of the gross profit margin of the main business in the chemical fiber and textile industry of the three enterprises in 2024, the gross profit margins of Unifull's polyester industrial yarn and special textiles increased year on year. The gross profit margins of Hailide's polyester industrial yarn and tire cord fabric decreased year on year, and the gross profit margin of Sanwei's polyester chemical fiber also fell year on year. According to the data from CCFGroup, the average processing spread of bright PET fiber chip was at 419yuan/mt in 2024, down by 44yuan/mt from 463yuan/mt in 2023. The processing spread of ordinary high-tenacity PIY 1000D fell by 240yuan/mt from 2003yuan/mt in 2023 to 1763yuan/mt in 2024. Therefore, in 2024, the decline of gross profit rate of main products of Hailide and Sanwei conformed to the general trend of the market, but the gross profit rate of Unifull increased, mainly because it adjusted its business strategy, carries out cost reduction and efficiency increase, controlled the cost of raw materials, adjusted the market structure, and increased the proportion of foreign trade and differentiated products.

Overall, in 2024, dragged down by the decline in costs, the prices of products in the polyester fiber industry decreased year on year, including PET fiber chips, polyester industrial yarns and their downstream textiles. However, due to the different year-on-year increases and decreases in sales volume, the operating revenues of Unifull, Hailide and Sanwei showed differentiation year on year. Among them, for Unifull, the simultaneous decline in price and volume of polyester industrial yarns led to a year-on-year decrease in total operating revenue. For Hailide, the significant increase in sales volume led to a year-on-year increase in operating revenue. Although Sanwei experienced a year-on-year decrease in operating revenue in the polyester chemical fiber industry due to the simultaneous decline in price and volume, the substantial increase in sales volume of products in other industries brought a relatively large year-on-year increase in total operating revenue. In terms of the net profit attributable to the parent company, in 2024, Hailide was the only profitable enterprise among the three, with a significant year-on-year increase in net profit. Although Unifull reported a loss in net profit, the loss margin was significantly narrowed compared to 2023. Sanwei's net profit changed from profitability in 2023 to a loss in 2024, with a particularly large year-on-year decline. The year-on-year changes in the net profit attributable to the parent company of these three enterprises in 2024 were diverse. Besides the factors of changes in gross profit margin, it was also related to aspects such as operating revenue, various other revenues, and other operating costs. Among them, Unifull was greatly affected by other operating costs, while Hailide and Sanwei were more influenced by various other revenues.