Shun Neng Oil, a lube blender and the China distributor for United States oil marketer Amalie Oil Co., reported big losses in the first half of 2016. According to Shun Neng, operating income for the first six months of this year was 30.9 million (U.S. $4.6 million), a 25 percent decrease from the same period of 2015, leading to a net loss of 2.88 million.
In a statement, the company – which supplies engine lubricants, greases and metalworking fluids – attributed the losses to a domestic economic slowdown that weakened the logistics industry, as well as downturns in heavy industries like the steel and cement sectors.
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Much less demand from our clients in the transportation sector hurt our sales of diesel engine lubes, and some of our clients in the heavy industries did not place any orders in the first half of this year, Shun Neng said.
Large expenses for research and development investments and establishment of distribution networks also contributed to the net loss.
Based in Tianjin, Shun Neng is listed in the Beijing-based National Equities Exchange and Quotations, a trading platform for Chinas small and medium companies.