Another Shandong-based company has put into production a medical mask project with an annual output of 50 million pieces, and its glove products have the largest market share in the United States!
Blue Sail Medical Co., Ltd. (hereinafter referred to as “Lan Sail Medical”) announced today (March 15) that the company’s 200 million/year medicalmask project is under construction The company has an annual output of 50 million disposable masks and has recently successfully produced qualified mask products.
Lanfan Medical stated that the completion and commissioning of the first phase of the project will further enrich the company’s product layout, which will be conducive to the supply of epidemic prevention and control materials and meet the subsequent market demand for medical and protective supplies.
According to the announcement, the total investment of Lansail Medical’s 200 million/year medical mask project is 20 million yuan, with Lansail Medical investing 11.6 million yuan and Hainuo Biotech investing 8.4 million yuan. The project construction address is Tailai, Laixi City, Qingdao City, Shandong Province. Haishi Hainuo Group Industrial Park, No. 1 East Road.
It is reported that medical masks are the main products of the mask industry. As of the end of 2019, the output value of medical masks reached 5.62 billion yuan, accounting for 54.91% of the total output value of masks. Industry insiders believe that with the outbreak of the epidemic, the demand for medical protective products has increased rapidly, and medical staff and close contacts need to take strict medical protection.
On the demand side, as Chinese people’s awareness of health and hygiene has increased, and as haze has worsened in some cities in recent years, the demand for masks in my country has continued to rise. According to data from the China Textile Business Association, in 2011, my country’s mask industry demand was approximately 1 billion, a year-on-year increase of 13.6%; by 2018, demand increased to approximately 4 billion, a year-on-year increase of 17.65%.
Data released by the CCID Research Institute of the Ministry of Industry and Information Technology shows that in the past five years, the output value of masks in mainland China has increased rapidly. From 2015 to 2019, domestic masks achieved output values of 6.318 billion yuan, 7.119 billion yuan, 7.91 billion yuan, 9.092 billion yuan, and 10.235 billion yuan respectively. billion, with a compound growth rate of 12.82%. In 2020, affected by the new pneumonia epidemic, the output value of the mask industry is expected to exceed 13 billion yuan, a year-on-year increase of 28.82%.
According to public information, Lanfan Medical was founded in December 2002. After it was completed and put into production in 2003, it entered the top ten in global market share within 4 years. Within 10 years, it ranked first in the world in the field of PVC gloves. It is a veritable PVC glove. King; In 2014, the company planned to enter the field of medical health and chose hemodialysis as the entry point. Since the company’s accumulation in the field of hemodialysis was weak and the target company was not a platform company with complete sales channels, it finally decided to withdraw from the hemodialysis business in 2016. In order to penetrate the market, it began to deploy nitrile glove projects in the same year to consolidate its original strong health protection business. However, the company did not give up entering the field of high-value medical device consumables. In 2017, it launched the acquisition of Biosensor International, the world’s fourth largest cardiac stent supplier. Start the road to becoming a leading multinational comprehensive medical device company.
Lanfan Medical currently has a PVC glove production line of 15 billion pieces/year and a nitrile glove production line of 2 billion pieces/year. According to the revenue and profit scale of the world’s major glove manufacturers in 2017, the company can rank among the top five in the world. The top four are all Malaysian companies (mainly latex and nitrile gloves). The company relies on the brand it has accumulated in the field of PVC gloves. Advantages, as the production capacity of nitrile gloves is gradually released, the competitiveness is expected to be further improved.
It is reported that nearly 90% of Blue Sail’s medical glove products are exported to more than 110 countries on 5 continents. Its multi-year strategic partners include Cardinal Health, HCA (American Hospital Group), Mckesson, etc. An internationally renowned pharmaceutical distributor, it has a channel foundation for in-depth development in the medical device industry and global layout. The U.S. market has always been an advantageous market, and its products have ranked first in the U.S. market share for many years.
The financial report shows that in 2019, Lanfan Medical achieved operating income of 3.485 billion yuan and net profit attributable to shareholders of listed companies of 492 million yuan, a year-on-year increase of 31.35% and 42.05% respectively. The main reason for the company’s performance growth is that the acquired Parkson International has been included in the company’s consolidated statements since June 1, 2018, which has a positive impact on the company’s performance.
Jiang Qi, an analyst at Zhongtai Securities, believes that Lanfan Medical’s overall relatively high growth in 2019 was mainly due to the merger of Biosensors International. Among them, operating income in the fourth quarter of 2019 was 886 million yuan, a year-on-year increase of 3.09%. Profit was 117 million yuan, a year-on-year increase of 36.15%, mainly due to the significant increase in net profit margins brought about by the increase in the proportion of high gross profit margin stent business. In terms of business lines, the stent business continues to maintain steady growth and is expected to successfully complete the performance bet. However, the company’s original PVC glove business performance has bottomed out, coupled with the US tax increase, the performance has declined significantly year-on-year.
From observation, the demand for Lanfan Medical’s protective products has increased during the epidemic, and the glove business is expected to increase both in volume and price. First, the glove production capacity has been further expanded. The current production capacity of PVC gloves is 15 billion pieces/year and nitrile gloves are 4 billion pieces/year. The convertible bond project will add 4 billion pieces/year of PVC gloves (expected to be officially put into production in the first half of 2020) and 2 billion pieces/year of nitrile gloves (expected to be officially put into production in the second half of 2020) to further meet the global protection requirements under the spread of the epidemic. Product demand; secondly, the mid- to long-term demand for domestic protective products has opened up. In the past, most of Blue Sail Medical’s gloves were exported. As Chinese people’s awareness of protection has increased significantly, and Blue Sail Medical’s domestic channels have been successfully opened up due to the epidemic, medium and long-termIt is expected to continue to boost domestic sales of protective products; in addition, tariffs on the United States have declined. According to the new batch of tariff lists and exemption lists, there will be no tax increase on PVC gloves, the tariff on medical-grade nitrile gloves will be reduced from 15% to 7.5%, and the tariff on industrial-grade gloves will be reduced from 28% to 3%, which will help Lanfan Medical further Seize U.S. market share.
Jiang Qi previously judged that as environmental protection pressure and labor costs increase, the overall glove market is expected to further concentrate on leading companies. Considering that the price of nitrile gloves is usually 30 yuan higher than that of PVC gloves, %, as Lanfan’s medical production capacity continues to expand, the scale of the glove business is expected to further increase; at the same time, the current consumption of disposable health protection gloves is mainly concentrated in developed countries and regions such as the United States, Europe, and Japan. Most of the products of domestic glove companies are based on Exports are the main focus. With the improvement of domestic protection awareness, the glove market is expected to continue to expand.
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