Jiutian Chemical net profit jumps more than 30 times year on year

JIUTIAN Chemical Group has posted a net profit of 90.31 million yuan (S$18.48 million) for its first quarter ended March 31, more than 30 times that of its net profit of 2.87 million yuan in the corresponding period in the preceding year.

Similarly, the group's revenue increased 120 per cent year on year to 439.25 million yuan, from Q1 FY20's 199.39 million yuan.

This was mainly attributed to an increase in both sales volume and average selling prices of its main products, dimethylformamide (DMF) and methylamine, Jiutian said in a bourse filing on Wednesday.

For the quarter, average selling prices of DMF and methylamine were 9,344 yuan per tonne and 9,272 per tonne respectively - 98 per cent and 38 per cent higher than their prices in Q1 FY20.

Furthermore, the sales volume of DMF and methylamine in Q1 FY21 were also 65 per cent and 32 per cent higher than in the preceding year respectively.

Jiutian said in its quarterly update: "The increase in sales volume and average product prices was mainly due to the continuing recovery of China's economy from the depth of the Covid-19 crisis and surge in demand for our main products from downstream users, who in turn are experiencing strong growth in both local and export markets for their products."

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Meanwhile, the group's capacity utilisation of its DMF plant rose from 56 per cent to 69 per cent year on year; that of its methylamine plant went up from 89 per cent to full capacity in the same period.

As a result of the higher average selling prices of its products, Jiutian's gross profit increased by 910 per cent, which in turn pushed its gross profit margin up from 7 per cent in Q1 FY20 to 32 per cent in Q1 FY21.

Shares of Jiutian Chemical ended Wednesday S$0.002 or 1.96 per cent lower at S$0.10, before the results announcement.