Sancon doubles profit, aims $8m sales in 2008

19 April 2007 05:44  [Source: ICIS news]

SINGAPORE (ICIS news)--Sancon Resources Recovery, a Chinese waste recycling company, on Thursday reported a more than doubling in 2006 gross profit on sales from two new subsidiaries in Hong Kong and aimed for an $8m revenue in 2008.

“Our results have reflected the successful integration of our Chinese recycling operation with our Australian recycling operation, and the addition of material trading operations, which all contributed strong to our sales,” CEO Jack Chen said in a statement.

“All three divisions … are fully on track with $8m revenue target for 2008,” he added.

Sancon’s 2006 gross profit reached $518,261 (€383,513) from $239,398 a year ago while revenue almost quadrupled to $3.4m. Net income reached $17,902 from a net loss of $42,552 in 2005.

However, the gross margin fell to 15% in 2006 from 27.6% a year ago due to lower margins from its newly launched plastic waste material trading and export units in Hong Kong.

Although the company reaped higher margins from its collection business in Australia, it needed the trading units to gain market share in the end-user markets, it said.

“The export of plastic products from China exceeded $10bn in 2005, and China imports more than 8m tonnes of recycled plastic materials each year and [it is] growing, Chen said.

“We anticipate being able to reach our target of 1% of the total national imports in the next two years, which will triple our current production and output,” he said.

($1=€0.74)


By: Florence Tan
+65 6780 4359



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