China Sunsine Chemicals Holdings

Moderator

Thank you for your help.

The increase of accelerator capacity from 70,500 tonnes to 75,000 tonnes was not the result of adding new lines.

You will note that in 2013 result announcement, accelerator capacity was reported to be 70,500 tonnes.

But in 1Q 2014 result announcement, the capacity at end of 2013 became 75,000 tonnes. The company explained that no new accelerator lines were added, but after process improvement in early 2014, the existing lines could produce more. We were quite happy to hear it.

We were also happy to hear that for similar reason, 6PPD capacity became 20,000 tonnes, from 15,000 tonnes originally.

I am trying to find out whether Sunsine is adding new accelerator lines. Utilisation must be very high now as 20,557 tonnes were sold in 2Q  alone.  

(11-09-2014, 07:57 PM)Young Investor Wrote: Moderator

Thank you for your help.

The increase of accelerator capacity from 70,500 tonnes to 75,000 tonnes was not the result of adding new lines.

You will note that in 2013 result announcement, accelerator capacity was reported to be 70,500 tonnes.

But in 1Q 2014 result announcement, the capacity at end of 2013 became 75,000 tonnes. The company explained that no new accelerator lines were added, but after process improvement in early 2014, the existing lines could produce more. We were quite happy to hear it.

We were also happy to hear that for similar reason, 6PPD capacity became 20,000 tonnes, from 15,000 tonnes originally.

I am trying to find out whether Sunsine is adding new accelerator lines. Utilisation must be very high now as 20,557 tonnes were sold in 2Q  alone.  

I have tracked the capacity of the company closely, but I didn't find the disclosure. The capacity at end of FY2013 was 70,500 tonnes, base on all announcements. The targeted capacity for FY2014, still at 75,000 tonnes as off 1H report.

I do agree the production efficiency has been in the up-trend, base on indicators observed. In the last 3 years, the production efficiency has been improved by an estimated 5-10% pa.

There are reason(s) for the conclusion that the company is well-executed and well-planned.

(not vested)

Young investor

I am quite sure Sunsine management has considered installing new lines to produce more accelerators. The company has been adding new lines gradually over the years.

Generally, production can go beyond capacity for a while. Therefore, in 2Q 20,557 tonnes were produced when quarterly capacity is 18,777 tonnes (75,000 divided by 4). Sunsine may have already planned to set up new accelerator production lines to grow market share, but will start the project later when its order backlog gets higher.

Latest update on the company debt level, 388.9 mil RMB.

http://infopub.sgx.com/FileOpen/CS_Discl...eID=314714

(not vested)

(12-09-2014, 09:08 PM)CityFarmer Wrote: Latest update on the company debt level, 388.9 mil RMB.

http://infopub.sgx.com/FileOpen/CS_Discl...eID=314714

(not vested)

Come 15.9.14 it will be back to 358.9 mil RMB, as 30 mil RMB is due on 15.9.14 and the latest 30 mil RMB debt is to replace the expiring one. So far no concern about the debts but would like to see the debts get pare down in the near future.

Bluechipfan

Come 21 Sep, aggregate will drop to RMB 338.9m when the RMB 20m China Construction Bank loan is paid off ( 4 Sep announcement).

(12-09-2014, 05:44 PM)simpleman Wrote: Young investor

I am quite sure Sunsine management has considered installing new lines to produce more accelerators. The company has been adding new lines gradually over the years.

Generally, production can go beyond capacity for a while. Therefore, in 2Q 20,557 tonnes were produced when quarterly capacity is 18,777 tonnes (75,000 divided by 4). Sunsine may have already planned to set up new accelerator production lines to grow market share, but will start the project later when its order backlog gets higher.

There will be cost saving if accelerator capacity is expanded.

Sunsine is a large exporter of rubber accelerators (around 10,000 tonnes in 2Q). The new base in Weifang (near Qingdao Port), sized for production of 50,000 tonnes of accelerators for export, is equipped to produce 20,000 tonnes now. The older, larger base at Shanxian helps to meet export demand.

Weifang produces MBT (feedstock for making accelerators) at a lower cost because aniline (used to make MBT) is available nearby.

To produce for export at inland Shanxian, MBT is trucked from Weifang to make accelerators, and the finished products are then sent to the Qingdao Port. The round trips, measuring 900 km each, cost around RMB 8m a year, for 20,000 tonnes of accelerators.

If Sunsine can grow its domestic market, Shanxian will keep more for internal demands, and new lines can be installed in Weifang to produce more accelerators for export, saving transport cost.

Dear Portuser,

What you have stated makes a lot of business sense. Would Sunsine buy the idea?

(13-09-2014, 08:15 AM)simpleman Wrote: Dear Portuser,

What you have stated makes a lot of business sense. Would Sunsine buy the idea?

You may wish to read Sunsine’s announcement (26 April 2010) on the rationale of basing in Weifang:

http://infopub.sgx.com/FileOpen/PressRel...eID=121196

The geographical advantages of the base (being near Qingdao Port and proximity to aniline suppliers) have yet to be fully exploited.

I bought some Sunsine shares a few months back when the prices of rubber accelerators were much lower than they are now. Am wondering whether the current prices have already reached all-time high with the prospects of no significant increases in the near future or can we expect further spikes to come. Wld appreciate the views of members. Thank you.