China’s Richful Lube Additives reported that its lubricant additives operating income surged 188% in 2022, while its overall net profit spiked more than 180% for the fourth quarter, compared to the same period in 2021, according to financial statements released last week.
According to Richful’s stock exchange filing, lubricant additives operating income reached ¥2.9 billion in 2022, improving from ¥996.1 million in 2021. Lubricant additives accounted for 94% of the company’s ¥3 billion operating income in 2022, up from 92% for 2021. The segment’s operating cost of ¥2 billion resulted in a 31% gross profit margin last year.
The company’s lubricant additive sales grew rapidly in 2022, and its production scale and inventory increased in a corresponding fashion, compared to 2021, Richful noted in its annual financial statement. Lubricant sales volume jumped 112% to 143,054 tons in 2022, production ramped up 104% to 151,042 tons, and inventory increased 64% to 20,483 tons.
The company’s overall net profit reached ¥588.1 million for full-year 2022, a 193% jump from ¥201 million in 2021. Overall operating income surged 182% to ¥3 billion for the year, compared to ¥1.1 billion.
In the fourth quarter, Richful’s net profit skyrocketed 243% to ¥224.5 million, compared to ¥65.4 million. Operating income in the fourth quarter rose 148% to ¥1 billion. Improving from ¥405.4 million.
Richful has a plant at its Xingxiang, Henan province headquarters location with capacity to produce 100,000 metric tons per year of additive components and 15,000 t/y in packages. It provides packages for passenger car engine oils, heavy-duty engine oils and anti-wear hydraulic oil packages.
Richful noted in its report that China’s demand for lubricant additives increased from 750,000 tons in 2013 to 919,000 tons in 2018, with an average annual growth rate of 4.2%. The company said that with the continuous growth of China’s motor vehicle market and the acceleration of industrialization, it is expected that demand for domestic lubricant additives will continue to main a relatively high growth rate.
According to a forecast of the Shanghai Lubricating Oil Industry Association that the company cited, for 2023, demand for lubricant additives in China is projected to increase to 1.12 million tons.