The Chinese Government has proactively launched various reforms and innovative initiatives in recent years to promote the requirements on “Environment Protection and Energy Saving” as well as to encourage technological transformation and upgradation in traditional industries. The Government policies, including the “One Belt and One Road” and “Made in China 2025” initiatives have been implemented to drive economic growth. These policies will have their positive effect on economic growth in the long run, and also provide new opportunities for companies in the medium to long-term development. Taking advantage of the Government’s favorable policies, CHTC Fong’s has laid a solid foundation for its mission to “become a world-class manufacturer of dyeing and finishing machinery”.
CHTC Fongs registered an increase of 9% in revenues during 2017 as compared to last year. Riding on the recovering global economy in 2017, coupled with the concerted efforts of the Group’s operating team to strengthen the marketing forces and improve the performance price ratio of its products, the dyeing and finishing machines business achieved satisfactory results with growth in both sales volume and operating profit. The name of the company has been changed from CHTC Fong’s Industries Company Ltd. to CHTC Fong’s International Company Ltd. with effect from December 2017.
The Group has successfully launched numerous new dyeing and finishing machines in recent years, including the DYECOWIN high temperature dyeing machine, JUMBOTEC high temperature dyeing machine, SUPERWIN high temperature package dyeing machine, SINTENSA cyclone tandem high efficiency washing compartment, MONTEX 6500 stenter frame range, MONFORTEX 8000 shrinking range, TIMATEC coating technology, etc. These new models and technologies, which are more environmentally friendly and energy efficient, helped solidify the Group’s market share and have received high customer recognition. They also reinforced perception of the Group as a high-quality, leading technology brand and enhanced customer confidence.
In order to cater to the future development of the textile industry, the demand on automated production and the new trend of smart factories, CHTC Fong’s will continue to invest resources in enhancing the efficiency as well as the functions of environmental protection, energy saving and automation of its dyeing and finishing machines so as to deliver premium products and provide innovative products and solutions of energy conservation and environment protection to customers, thus creating more value. In mid-2017, the Group signed a strategic co-operation agreement with Yantai Yelin Textile Printing & Dyeing Co. Ltd. to form a joint venture company in Yantai.
The joint venture company will engage in printing, dyeing and after-finishing of high-end fabrics by developing the most advanced automatic printing and dyeing production line in the PRC with the new automatic printing and dyeing solution of the Group. The JV company will become the first demonstration enterprise, where the Group will be able to showcase its automatic production solution on printing and dyeing to customers.
The new production plant of the CHTC Fong’s located at Zhongshan City in Guangdong Province is expected to start operations in phases. Upon full operation of the new plant, the Group’s production capacity is expected to increase significantly. The new plant will be focus on energy conservation, production efficiency and high efficiency in the design of production processes and will apply more automated processes to reduce the manpower requirement and labour costs.
Environmental protection services
The CHTC Fongs Group is not only focused on the dyeing and finishing machines, but also actively pursues business development along the whole industrial chain, especially in wastewater treatment operation where the Group provides wastewater treatment equipment for its customers in the dyeing and finishing industry and provide them with relevant technical consultancy services.
Furthermore, in order to broaden its income streams, the Group has acquired stake in Beijing CSCE Environmental Engineering Technology Co. Ltd. (“CSCE”). CSCE is a private company set up in the China and principally engages in providing full spectrum of services (such as contracting, advisory and operation management services) on municipal wastewater and solid waste treatment projects, including kitchen wastes recycling and innocuous treatment, municipal solid waste incineration power generation, municipal sewage sludge treatment and high concentration organic wastewater treatment projects, etc. With years of experience, CSCE has gained the relevant expertise in environmental protection and has obtained necessary licences from the PRC authorities to operate the approved projects.
The Board considered that this acquisition was a rare opportunity for the Group to expand its business scope by participating in the fast growing environmental waste treatment operation in China. The acquisition would also fetch the Group additional income for further enhancement of its performance. Moving forward, the Group will continue to explore potential investment opportunities to expand this business.