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Nine Dragons To Grow through Integration & Synergy of Resources
2022-03-18 13:50chinapaperonline.com
As shown by its latest financial reports on March 15, Nine Dragons was capable of running 18.42 million metric tons of pulp (both virgin wood and recycled), paper and paperboard annually by end-2021. For paperboard that includes linerboard, medium and boxboard, the group's annual capacity reached 16.20 million metric tons, narrowing further its difference in the packaging paperboard segment with the world leader – International Paper.

On financial performance, the group's revenue in the 2nd half of 2021 rose to RMB34.47 billion, up 11.61% from the same period of 2020, with 93.3% coming from packaging paperboard sales. The company said frankly, however, that due to the rising prices of coal, chemicals, recovered paper and ocean freight, especially the faster and greater increases in raw material costs than the rise in the product sales prices, coupled with the government’s introduction of environmental protection policies on coal-to-gas conversion and dual control of energy consumption, the entire Chinese manufacturing industry and packaging paper industry are facing huge operating pressure. As a result, the group's gross profit fell to RMB4.681 billion in the period, a decrease of 27.5% year-on-year. And gross profit margin shrank further from 20.9% in the same period last year to approximately 13.6% in the current period. Adding various expenses, the group's operating profit for the period decreased to RMB2.888 billion, declining approximately 41.5% from that of last year. At the same time, operating profit margin shrank further from 16.0% in the same period last year to approximately 8.4% in the current period.

In view of the fact that Nine dragons has invested and operated pulp and paper projects in China, Malaysia, USA and other places, with about 1.3 million/mtpy of pulp and paper production capacity as well as its well established recycled fiber souring networks in USA alone, its global business chain from raw material supply to product production, conversion and product sales has been formed. With the commissioning of the new projects, the group is bound to better integrate domestic and foreign resources in 2022 to be synergetic as soon as possible, so as to become a global conglomerate of sustainable development.

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