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Chinese supplier of high-temperature alloy products plans to invest 138 million yuan (approximately $19.1 million USD) in constructing a factory for key petrochemical equipment components in Saudi Arabia. This move aims to better serve Middle Eastern clients and expand its overseas presence.
The project, led by the company’s subsidiary in Qingdao, will be located in Jubail Industrial City. The new facility is primarily focused on manufacturing ethylene cracking furnace tubes, essential components in petrochemical processing. The company did not specify the plant’s annual production capacity or provide an expected return on investment.
Ethylene cracking furnace tubes are vital parts of ethylene cracking units, functioning as reaction chambers where petrochemical feedstocks are heated to high temperatures. This process results in the production of fundamental chemicals like ethylene and propylene.
Known as a leading provider of ethylene cracking furnace tubes in China, the company believes that establishing this factory in Saudi Arabia will strengthen the competitiveness and brand presence of its products on the international stage. It also aims to improve responsiveness to customer needs.
Saudi Arabia, recognized as the largest economy in the Middle East and North Africa, offers a stable political and business environment with relatively low investment risks, making it an attractive location for expansion, according to the company.
In other financial news, the firm reported a 10% increase in third-quarter profits, reaching 60.8 million yuan (about $8.4 million USD), compared to the previous year. Operating revenue also grew by 23%, totaling 987 million yuan (roughly $136.21 million USD), driven by recovering demand in the aerospace, metallurgical, and energy industries. For the first half of the year, revenue had increased by 5.1% compared to the previous year.
However, for the first nine months of this year, profits declined sharply by 47%, to 125 million yuan (around $16.3 million USD), primarily due to rising raw material costs and declining product prices. Despite this, operating revenue increased by 11%, reaching 2.8 billion yuan (approximately $387 million USD).
Shares of the company traded slightly lower, dropping 0.3% to 16.67 yuan (about $2.34 USD) per share as of mid-morning in Shenzhen.
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