• Total revenue: USD820.04 million (RMB5.44 billion), down 39% YoY

• Net profit: USD166.27 million (RMB1.10 billion), largely up 109% YoY

• New profit with extraordinary items deducted: USD165.82 million (RMB1.10 billion), largely up 249% YoY

Source: Baidu

The significant profit growth was mainly attributed to:

1. Increase in methionine production capacity
In early 2016, the second phase of the company's methionine project (70,000 t/a) was put into operation, boosting the sales and profits. To date, Adisseo's total production capacity of methionine in China has mounted to 140,000 t/a.

2. Surge in market price of vitamin A (VA)
As the fourth largest VA producer in the globe, Adisseo benefited a lot from the large rise in the market price of VA at home and abroad in H1 2016. According to CCM’s price monitoring, the market price of food grade VA (325,000 IU/g) in H1 2016 averaged USD62,288/t (RMB142,826/t), up 90% YoY.

3. Decrease in crude oil price
Thanks to the downward crude oil price, Adisseo lowered its production costs of raw materials (oil derivatives). According to CCM's price monitoring, between Jan. and June this year, the London Brent crude oil price averaged USD52.97/bbl, down 14.36% YoY.

Adisseo's financial performance, H1 2015 & H1 2016

Source: Bluestar Adisseo Company

Monthly market price of food grade vitamin A (325,000 IU/g) in China, Jan. 2015-July 2016

Source: CCM

According to Adisseo’s H1 2016 financial report, the company's performance:

- By product

Performance products, including methionine, VA, ammonium sulfate and sodium sulfate, are the largest contributor to the total revenue. Of this business:

• Revenue: USD678.97 million (RMB4.50 billion), 82.81% of the company's total

• Gross profit margin: 52%

Of the four aforementioned products, methionine takes a leading role. H1 2016 witnessed a fall in the methionine price. According to CCM's price monitoring, the market price of methionine (imported fluid) averaged USD3,740/t (RMB24,788/t), down 39% YoY. Affected by this, Adisseo's total revenue in H1 fell down. Yet, thanks to the high gross profit margin of performance product business, the net profit showed significant growth.

- By region

Adisseo has its main markets in Europe, Africa and the Middle East, generating a revenue of USD262.84 million (RMB17.42 billion) in H1, 30.05% of the company's total. Notably, a revenue of USD110.90 million – RMB735 million (13.50% of the total) came from the Chinese market which ranked fifth among all other regions.

Adisseo's revenue by product, H1 2016

Source: Bluestar Adisseo Company

Adisseo's revenue by region, H1 2016

Source: Bluestar Adisseo Company

Monthly market price of liquid methionine in China, Jan. 2014-July 20166

Source: CCM

In 2015, Adisseo got listed on the Shanghai Exchange Stock (A share). Currently, Adisseo has two main subsidiaries engaged in production, Bluestar Adisseo (Nanjing) Co., Ltd. (BANC Nanjing) and Adisseo France SAS (Adisseo France).

In particular, Adisseo France, the most important one, is mainly in charge of the production of upstream products of methionine as well as liquid and solid methionine (plant for liquid methionine located in Burgos, Spain). In H1 2016, it generated a revenue of USD655.28 million (RMB4.34 billion) in H1 2016, 87.27% of Adisseo's total.

BANC Nanjing focuses on the production of liquid methionine. This company and the Spanish plant complement each other in times of production suspension for maintenance (given the stringent requirements for production techniques and environmental protection, methionine plants should have production facilities inspected from time to time).

At present, Adisseo targets at the R&D, production and sale of feed additives. In 2015, the company developed and launched protected methionine (with the functions of raising protein levels in milk and lactating ration of ruminants) for ruminants such as dairy cows. In Aug. 2016, Adisseo announced that its industry category has been converted from chemical manufacturing (code: C26) to medical manufacturing (code: C27), indicating a clearer market positioning.

Adisseo's net profit by subsidiary, H1 2016

Note: Adisseo France stands for Adisseo France SAS;

     BANC Nanjing stands for Bluestar Adisseo (Nanjing) Co., Ltd.;

     Figures are based on financial information before elimination of the entities.

Source: Bluestar Adisseo Company

This article comes from Amino Acids China E-News 1608, CCM

About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.

For more information about CCM, please visit www.cnchemicals.com or get in touch with us directly by emailing econtact@cnchemicals.com or calling +86-20-37616606.

Tag: methionine   Amino Acids

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