SINGAPORE (Nov 6): Specialty rubber chemicals producer and rubber accelerators supplier China Sunsine Chemical Holdings saw its earnings jump 85% to RMB 143.4 million ($28.6 million) for the 3Q18 ended September, from RMB 77.6 million a year ago.

The increase was on the back of higher revenue and gross profit margin.

3Q18 revenue rose 22% to RMB 775.6 million, from RMB 634.4 million a year ago, due to an increase in both sales volume and overall average selling price (ASP).

Sales volume for accelerators and anti-oxidant products increased by 5% and 32% respectively in 3Q18. This was mainly due orders being switched to the company as some of the other rubber chemical producers failing to meet environmental protection standards and being forced to suspend their production.

Overall ASP increased by 12% to RMB 20,706 per tonne in 3Q18, mainly due to the fixing of higher quarterly prices with China Sunsine’s bigger customers in advance in the previous quarter. This was as a result of the short supply of rubber chemicals in China during the past few quarters.

Gross profit grew 50% to RMB 254.0 million during the quarter, as gross profit margin increased by 5.9 percentage points to 32.7%.

The group also saw a decrease in income tax expenses as Shandong Sunsine obtained “high-tech enterprise” status, and is entitled to a concessionary tax rate of 15%.

As at end September, cash and cash equivalents stood at RMB 819.9 million.

Looking ahead, the group says it will continue to maintain its strategy of “higher production leading to higher sales volume, which in turn will stimulate even higher output” for the rest of the year.

“The group will continue to place emphasis on and invest heavily in environmental protection and safety, and technology innovation, to further strengthen its market leadership position,” says Xu Cheng Qiu, executive chairman of China Sunsine.

Shares in China Sunsine closed 6 cents lower, or down 5.6%, at $1.01 on Monday.