Hongcheng Environmental Technology (02265) issued an announcement. It is expected that the year ending December 31, 2023 will be released...
According to Zhitong Finance App News, Hongcheng Environmental Technology (02265) issued an announcement. It is expected that the year ending December 31, 2023 will obtain no more than 17.5 million yuan (RMB, same below) of annual profit attributable to company owners, a decrease of about 78.2% from the annual profit of about 80.2 million yuan attributable to company owners for the year ended December 31, 2022. It is expected to generate revenue of approximately $108 million for the year ended 31 December 2023, down about 51.5% from revenue of approximately $222.8 million for the year ended 31 December 2022.
The board of directors believes that the main reason for the decline in profit and earnings due to the company's owners during the year was the decline in the sales volume and unit price of sulfur concentrate due to the decline in the production process that required sulfur concentrate as the main raw material. For example, the market price of products in the sulfuric acid-related industry dropped sharply compared to last year; due to the drastic reduction in the amount of cyanide tailings provided by upstream customers, the revenue from hazardous waste treatment services in gold mines decreased compared to last year; and the Group's sulfuric acid production line began operation in 2023, so the group can then use sulfur concentrate to add other raw materials for reprocessing to produce sulfuric acid, iron powder and electricity for sale, thus enriching the product portfolio. Since sulphur concentrate is the main raw material in the production of the new production line, the Group has reserved sufficient supply of sulfur concentrate for the new production line. Sales of products produced on the new production line contributed to the Group's new revenue stream (i.e. sales of sulfuric acid, iron powder and electricity) in the fourth quarter of 2023. However, this new revenue stream was insufficient to offset the decline in revenue from sales of sulfur concentrate.