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China Shengda Packaging profit drops in Q1

China Shengda Packaging Group has reported a 2.4% decline in its first quarter profit to $26.9m, compared to $27.6m in the prior year period.

The company said its sales volume decreased 5.3% to 73.6m square meters from 77.7m square meters in the prior year period.

China Shengda has attributed the decrease in sales volume to a reduction in demand from the company’s customers due to challenges resulting from more restrictive financial policies by the People’s Bank of China.

The firm’s colour cartons accounted for 26.0% of total revenues in the first quarter of 2011, while flexo cartons accounted for 74.0%, compared to 25.7% and 74.3%, respectively, in the same period of 2010.

The company’s major customers in home appliances and electronics manufacturers and food, beverage and cigarette manufacturers, accounted for 26.2% and 26.7%, respectively, of the total revenues in the first quarter of 2011.

China Shengda said its gross profit declined 10.7% to $7.1m from $7.9m in the same period of 2010.

The company’s gross profit from flexo cartons dropped 11.7% to $5.1m from $5.8m in the same period of 2010. The gross profit from colour cartons declined 9.5% to $1.9m from $2.1m in the same period of 2010.

The company’s net income attributable to common stockholders decreased 20.1% to $3.4m, from $4.3m in the same period of 2010.

The company expects its revenue will reach between $115m and $125m, net income between $11.5m and $12.5m in 2011-12.