Hailir: With 1H 2023 net profit of RMB331 million, pesticide technical development route becoming more clear

Chinese agrochemical company Hailir recently released its semi-annual performance report on August 29, saying that in the first half of 2023, the company achieved sales of RMB2.663 billion, which is a year-on-year decrease of 5.24% and a net profit attributable to the parent company of RMB331 million, which a year-on-year increase of 0.47%.

According to the semi-annual report, the main reasons for achieving the operating results in the first half of 2023 are the sharp price fall of pesticides, which could not be covered by the increase in sales, thus resulting in a decline in revenue; Good profitability of the company’s prothioconazole products, which has boosted the overall gross margin while the exchange rate benefit had a positive impact on the company’s performance.
 
In the first half of 2023, when the overall industry was depressed, the company’s production and sales increase could offset part of the adverse effects. Moreover, the profit contribution from new products was quite significant. The company’s overall performance did not fluctuate much, and the state of operations was relatively stable.

Pesticide technical development strategy becoming clearer
 
On top of the improvement to production, quality and cost of the existing dichloride intermediates, imidacloprid, acetamiprid, emamectin benzoate and pyraclostrobin, the company’s second-generation nicotinic insecticide technical thiamethoxam and clothianidin began production in June 2020,

This was followed by trial productions of prothioconazole in September 2020, the annual 40,000-ton agrochemical material and intermediate project (Phase I) of Qingdao Hengning Biotechnology Co., Ltd in June 2022, and Hailiir’s 3,000-ton prothioconazole technical project in December 2022.

It was decided to expand the production capacity, promote the strategic product diversification, and give full play to the advantage of scale to meet the company’s business volume requirement and the long-term strategic development needs in the future.

At a board meeting held on April 27, 2023, it was decided to change the investment project of Qingdao Hengning’s Phase II. This is a further clear determination of the company’s technical material development strategy.
 
All-round industry deployment, third-party testing service ushers in change
 
Qingdao Tengrunxiang Testing and Evaluation Co., Ltd is Hailir’s wholly owned subsidiary, an independent third-party testing and evaluation organization is committed to protecting the environment and human safety. The company provides customers with safety evaluation, pre-clinical and registration-oriented testing covering pesticides, fertilizers and chemicals. Currently, it is a pesticide registration-oriented testing organization recognized by the Chinese Ministry of Agriculture.

The scope of testing service covers product chemistry, efficacy, and toxicology tests (the only one with pesticide toxicology testing qualification in Shandong Province), The ecotoxicology test and crop residue test, have been granted China’s CNAS and CMA pesticide and fertilizer testing qualification.