FINANCIAL HIGHLIGHTS

17 August 2016 – Hong Kong) Haitian International Holdings Limited (“Haitian International” or “the Company”, which together with its subsidiaries and associates, is referred to as “the Group”; stock code: 1882), one of the world’s largest plastic injection moulding machine (“PIMM”) manufacturers, is pleased to announce its interim results for the six months ended 30 June 2016 (“1H2016”).

Continued to deliver high level of interim revenue and profit 

In 1H2016, as China economic development at a lower speed became new ordinary and the weakening overall demand for PIMMs, Haitian International managed to deliver high level of interim revenue and profit amid current adverse external environment. During the review period, the Group strengthened its leading position in the industry and recorded revenue of RMB3,860.9 million, representing an increase of 0.3% compared with that of 2015, while was 10.8% higher than the sales in the second half of 2015, reflecting a path of recovery in the sales of the Company along with the slow recovery of economy. If the change in fair value of the USD200 million Convertible Bonds issued in 2014 were excluded, the adjusted net profit attributable to shareholders for 1H2016 would have increased by 8.6% to RMB712.8 million compared with that of 2015. The Board of Directors has declared a first interim dividend of HK$0.17 per share for the six months ended 30 June 2016(1H2015: HK$0.16).

Improved operational efficiency and productivity

Due to the structural change in sales after the full launch of “Plus” series machines and stable raw material costs, the Group continued to make progress in its operational efficiency and profitability. In 1H2016, its gross margin increased to 34.1% from 32.3% in the same period in 2015. The increase was attributable to the improvement in operational efficiency and low raw materials price. With the improved gross profit margin, its operating profit increased by 10.7% to RMB799.5 million in 1H2016. Its adjusted net profit margin (excluding fair value change in CB) also improved from 17.1% in the same period of 2015 to 18.5% in 1H2016, which was a record high in the Group’s history.

Successful strategy for increasing proportion of innovative products in sales mix

Though under the unfavourable external macro-economic environment, the Group continued with its business development strategy of converting small tonnage hydraulic PIMMs to full-electric PIMMs and large tonnage PIMMs to two-platen PIMMs, thus making remarkable progress in raising the proportion of innovative products in sales mix. The proportion of full-electric PIMMs in small tonnage PIMM sales increased from 13.7% to 13.8% and that of two-platen PIMMs in the sales of medium-sized and large tonnage PIMMs rose from 27.0% to 34.5% in 1H2016. The Group’s second generation machines have established well recognition in the market and the advantages in performance and efficiency of its second generation machines and newly launched “Plus” series upgraded machines are well recognized by customers. Sales of Zhafir Venus Series (full-electric PIMMs) increased by 2.3% to RMB340.4 million and those of Jupiter Series (large two-plate PIMMs) rose by 24.4% to RMB453.7 million. The strong growth in sales of full-electric and two-platen PIMMs enabled Haitian International to maintain sales volume similar to that in 2015 despite the tough business environment. Meanwhile, its Mars Series remained the best-selling plastic injection moulding machines and accounted for nearly 70% of the total sales because of the continued improvement and the successful introduction of the second-generation products and the “Plus” series machines.

Advantages of geographically diversified market and leading position in domestic market

In 1H2016, the overall demand for PIMMs remained stable amid the transition in domestic economy and global complicated environment. With the new policy of encouragement for new entrepreneurs and innovation, the demand in domestic PIMM market has seen a mild recovery. Benefiting from well market acceptance of its full-electric PIMMs and two-platen PIMMs, Haitian International’s domestic sales recorded an increase of 5.2% to RMB2,741.0 million and this further reinforced its leading market position in China. In the export markets, due to low investment and purchase momentum in some countries in the emerging markets resulting from depreciation of currencies and political instabilities, Haitian International is planning for more resource input to markets with potential in order to enhance its service capabilities to customers. The management believes that this would further strengthen Haitian International’s advantage in diversification in different markets. During 1H2016, the Group recorded export sales of RMB1,042.3 million, representing a decrease of 10.6% compared with that in 2015.

The German subsidiary of the world’s largest injection molding machine manufacturer, Haitian International, celebrated the completion of its new manufacturing hall at its site in Ebermannsdorf together with 680 guests from 15 nations.

On 06.06.2016 – the number 6 means luck – the official opening ceremony took place along with Mr. Zhang Jianming, CEO of Haitian International and Mr. Zhang Jianfeng, CEO of Haitian Plastics Machinery. The Mayor of Ebermannsdorf, Josef Gilch, brought a special gift: The new access road to the company is now officially registered as “Haitian street”.

This event marks an important milestone for the team in Germany. Mr. Xiang Linfa, General Manager of Haitian International Germany, explains: “We want to be more responsive to the needs of our customers and meet their requirements from the relevant industries as best as possible. This has always been our company philosophy. With the second plant we have given ourselves more space to e.g. test complete production cells also with larger series. ”

Installation of Mars and Jupiter machines

After around 9 months of construction – the official ground-breaking ceremony was on 01.09.2015 – the 8,000 square meter new building (7,500 sqm manufacturing area) was opened for the numerous guests out of the plastics industry and regional politics. Effective immediately, servo-hydraulic machines of the Mars II and Jupiter II Series will be assembled in this hall for the European market, customized for customers and tested through its paces. The production range covers clamping forces from 600 to 30,000 kN. With growing focus to the energy-saving two-platen Jupiter II Series (entire range 4,500-88,000 kN). At the Grand Opening visitors could already get an idea of the performance of the two-platen technology, since several Jupiter machines with up to 21,000 kN demonstrated their dynamics and precision live in action.

In the first hall, built in 2009, the electrical Zhafir machines Venus II Series and Zeres Series will continue to be assembled with clamping forces from 400 to 6,500 kN. The application center in the Zhafir hall offers mold tests and trainings for German and European customers.

More capacity in service & support

With the commissioning of the 2nd factory, Haitian International Germany has a significantly extended production capacity. This will increase the availability of the machines “to go” as well as the speed of delivery time of spare parts.

More service strength in the fields of pre- and after-sales was the second important aspect in the investment decision of the Haitian Group for the site in Germany. “The new hall and the resulting space gives us many more opportunities to offer mold testing on production cells with larger machines,” says Philippe Porret, Deputy Manager of Haitian International Germany. “We are simultaneous growing in all areas. In assembling and system development, in sales and service structures, and in all levels of support. ”

Haitian International, the largest injection molding machine manufacturer in the world in terms of units, is staying true to its principles: to deliver “Technology to the Point” with efficient standard machines that do an excellent job of fulfilling the core functions of modern injection molding technology.

Electrical solutions from 400 to 10800 kN

With the electrical solutions of high tech brand Zhafir Plastics Machinery, Haitian International underlines once more the consistency of its market focus with demand-driven technology to the point. In 2015 the Zhafir Series increased by 29.5% and reached more than 1700 orders, which is an increase of 46.2% compared to 2014. A VE1200II/300 runs a flexible cable tray base with 9.85 g part weight in 4 cavities made by ABS. Supported by Haitian Drive (automation), Kawata (auxiliary equipment) and Boshiyuan (mold monitoring).

The Zeres Series offers all the advantages of electric injection molding technology: precision, energy efficiency, independent parallel movement throughout the whole cycle, and, not least, easy maintenance. Servo electric drives for injection, dosing, and mold movement ensure a high level of dynamics. In addition, an integrated servo-hydraulic unit for minor movements the Zeres for applications with core pulls or standard precision parts. On Chinaplas a ZE1200/300 runs with a 2.5g connecting piece and is further assembled with the flexible cable tray base (produced on the Venus) through automation, made by PA66+GF13 on an 8-cavity mold in 15 sec. Supported by an Haitian Drive Robot and auxiliary equipment from Kawata.

Two-color injection molding on a two-platen solution

The Haitian IA II Series with parallel injection unit system is based on the successful two-platen Series “Jupiter II”. The turntable system provides fast and smooth rotation and easy usage. The reliable locking system is guided and locked during mold open/close movements to ensure a high parallelism with the platen. A IA7500II/n-j runs a mold with 104 keys with 138g part weight made by ABS/PA in 45 sec. Supported by Haitian Drive (automation) and Shini (auxiliary equipment).

The bestseller Mars II Series as “high performance” version

The “h” version of the bestseller Mars Series – already installed more than 150.000 units so far – is one part of a production cell, which produces a 4-cavity ice cream cup with IML, made by PP and a cycle time of 4 sec. Supported by GH (automation), Huare (auxiliary equipment), Borough (material) and Laiyin Mold.

Haitian International, one of the world’s largest manufacturers of plastic injection molding machines, has announced its financial results for fiscal year 2015. Based on the proven strategy “Communication for trust, Innovation for technology to the point, efficiency for sustainable growth and profitability” the Haitian Group delivered around 26,000 machines and recorded a turnover of RMB 7.34 billion (approx. EUR 1.04 billion), which represents a slight decrease of 3.0% compared to the previous year but still an outstanding position in the entire plastics industry. The net profit attributable to equity holders increased by 0.1% to RMB 1.33 billion (approx. EUR 188.5 million) compared with that of 2014.

Despite the ongoing difficult operating environment, the Group’s domestic sales (China) recorded only a mild drop of 4.0% to RMB 4,869.2 million (approx. EUR 688.7 million). In the export markets, Haitian International launched innovative products, strengthened its sales network and enhanced pre-sales and after-sales services. In some regions such as Vietnam, Korea, India, Europe and Mexico, the Group recorded impressive sales growth. The export sales amounted to RMB 2,292 million (approx. EUR 324.19 million), representing a mild drop of 1.6% compared to 2014 and the second highest export ever. Gross profit margin increased to 33.0% from 32.4% in 2014 and the operating profit increased by 4.0% to RMB 1,545 million (approx. EUR 218.53 million).

To cope with the challenges in the market during the year, Haitian International continued its business development strategy of converting small tonnage hydraulic machines to electric solutions and large tonnage machines to two-platen solutions, thus making remarkable progress in raising the proportion of innovative products in the sales mix. The sales of the all-electric Zhafir Venus Series increased by 29.5% to RMB 675.7 million (approx. EUR 95.57 million) and reached more than 1600 orders, which is an increase of 46.2% compared to 2014. Sales of the large two-platen Haitian Jupiter Series reached nearly 500 units and rose by 39.8% to RMB 741.3 million (approx. EUR 104.85 million) compared to 2014. The proportion of Zhafir electric machine sales in small tonnages increased from 11.1% to 14.8% and the sales of two-platen machines in medium-sized and large tonnages rose from 19.5% to 28.5%. The Mars Series remained the best-seller and accounted for nearly 70% of total sales.

Upgrades with “Plus”

Looking ahead, Mr. Zhang Jianming, Executive Director and CEO of Haitian International, said, “Over the past five decades, we faced different up’s and down’s and structural changes to the Chinese economy. We will continue to navigate through the existing environment and capture business opportunities again so as to grow stronger. We will launch a significant upgrade of our electrical and two-platen series which comprises second-generation models of all the product lines. This will enable us to improve customer benefits and expand our market share.”

International Expansion

Production efficiency and sustainable growth are key factors for Haitian International in the process of participating in the global plastics industry. Through the consistent expansion of production capacities and services in various markets, the customer support on-site should be optimized and enhanced. Showrooms and application centers for mold tests are in as much focus as faster customization of stock machines and increased availability of spare parts. In this context, in 2015, new production plants in Germany and India have been built and will be put into operation in 2016. Moreover, the existing sites in Brazil, Vietnam and Turkey have been expanded with application centers. New Technical Centers have been opened in Indonesia, Mexico and Thailand, complete with application centers as a performance focus.