ZHEJIANG WALRUS NEW MATERIAL CO.(SZ:003011)2022-11-11 05:54Company Overview and Performance - Zhejiang Haixiang New Materials Co., Ltd. was established in 2013 and has expanded internationally with subsidiaries in the USA, Vietnam, Hong Kong, Germany, and Shanghai [3] - The company primarily produces PVC flooring, categorized into LVT, WPC, and SPC types, which offer advantages in safety, environmental protection, functionality, and convenience [3] Production Capacity - Current domestic production capacity is 21 million square meters of PVC flooring annually, approximately 800 cabinets per month [3] - The first factory in Vietnam has a designed capacity of 8 million square meters (350 cabinets/month), and the second factory has a capacity of 7 million square meters (300 cabinets/month) [3] - A new project for a production base with a capacity of 20 million square meters is underway, with the third factory in Vietnam also in planning stages [3] Financial Performance - For the first half of 2022, revenue from LVT flooring was 85.88 million CNY (8.98% of total revenue), WPC flooring was 133.53 million CNY (13.96%), and SPC flooring was 726.83 million CNY (76.00%) [3] - Compared to the same period in 2021, LVT revenue decreased from 124.38 million CNY (15.05%), WPC increased from 106.78 million CNY (12.92%), and SPC increased from 586.21 million CNY (70.94%) [3] - Overall revenue growth for the first half of 2022 was 15.73%, a slowdown compared to 43.98% in 2021, attributed to a slowing PVC market [3][4] Market Analysis - Export data shows a growth in export quantity of chlorinated polyvinyl chloride flooring products: 17.60% in 2020, 26.59% in 2021, and 4.44% in 2022 [4] - PVC flooring is gradually replacing tiles and solid wood products in the European and American markets, indicating significant growth potential [4] Competitive Landscape - The company’s competitive advantages include strong R&D capabilities, high product quality, and a diversified distribution channel [5] - Current order levels have decreased compared to previous years, with future demand uncertain due to market conditions [4][5] Pricing and Profitability - The company employs a pricing strategy that combines cost-plus and market-based pricing, with no significant differences across product lines [6] - Gross margin improved from 15.33% in Q1 to 20.45% in Q2 of 2022, primarily due to currency fluctuations [7] Future Outlook - The company plans to adjust investment strategies for new projects based on market conditions and economic factors [5] - The impact of geopolitical events, such as sanctions on PVC products from Xinjiang, has not yet affected the company [7]