In 2018, Xingye Technology Net Profit Was Close To 130 Million, And Zara And Prada Were All His Customers.

The leather products Polytron Technologies Inc (hereinafter referred to as "Xingye science and technology"), a local manufacturer of high-grade top grade shoe upper leather, issued a notice of performance notice amendment in the evening of January 9th, after which the company expects net profit increased by 70% to 120% in 2018.

The revised profit increased from 113 million yuan to 131 million yuan, up 150% to 190% over the same period last year.

The main reason for performance correction is the company's product structure optimization, quality improvement and production cost reduction, resulting in a substantial increase in gross margin.

Societe Generale technology released the first three quarters of 2018 performance report shows that during the reporting period, the company achieved operating income of 1 billion 270 million yuan, down 8.27% compared with the same period last year, net profit attributable to the parent company 55 million 160 thousand yuan, an increase of 59.53% over the same period, corresponding to earnings per share of 0.18 yuan / share.

According to the insiders, although the price of raw leather is showing a downward trend, the profit margin is still not ruled out.

At the same time, in the face of fierce market competition, Xingye technology has adopted an active R & D strategy to improve the utilization ratio of finished leather through process adjustment, and develop new products such as chrome free tanning and semi vegetable tanning.

In the medium to long term, with the reform of the supply side of leather industry and the tightening of environmental policies, Xingye technology is still expected to benefit from the trend of concentration.

It is understood that, in the case of sluggish domestic market demand, Xingye technology striving to expand cooperation with foreign brands. At present, it has established cooperation with Earth, Ninewest (Jiu Xi), Polo (Paul), Zara (SA LA), Prada (Prada), Bally (Ba Li) and other brands. At the same time, the company has intensified its research and development efforts, adjusted its process in the coating section, and developed chrome free tanning and semi vegetable tanning products for different customer needs.

In recent years, Xingye technology has continuously increased environmental protection investment, leading the clean production technology industry, and the pollutants such as water, gas and sound are all up to standard.

In addition, as the market leader of the ox head shoe upper leather, the company has the advantage of scale cost, and the product positioning is more high-end. It can withstand the cost increase brought by the increase in environmental protection investment, and is expected to benefit from the upgrading of the market share after the capacity of the industry.

Li Jie, an analyst at Everbright Securities, said earlier that Societe Generale technology was the first to occupy the first place in the Ngau Tau shoe upper leather industry for many years. It was affected by the downturn in downstream consumption and fierce competition in the industry, and income began to readjust in 2017.

But as the downstream leather shoes enterprises adjust to the end of the channel, the pressure will be gradually reduced.

In addition, as the downstream demand is relatively stable, it is expected that the price of cattle raw leather will increase at a low probability. Xingyi technology will increase the development of high-grade and high value-added products, and it is expected to boost profitability slightly. In the long run, with the increase of environmental protection, the supply side reform of leather industry will enhance the concentration. Xingye technology will benefit from the leading industry.