China Shengda Packaging Group Inc., a leading Chinese paper packaging manufacturer, today announced its financial results for the three months ended June 30, 2011.
Revenues decreased $0.7 million, or 2.2%, to $32.6 million for the three months ended June 30, 2011, from $33.3 million during the same period of 2010. The decrease was primarily a result of decreased sales volume. The sales volume decreased 6.7 million square meters, or 7.7%, to 80.1 million square meters for the three months ended June 30, 2011, from 86.8 million square meters during the same period of 2010. The decreased sales volume was mainly the result of (i) a reduction in demand from the customers due to challenges resulting from more restrictive financial policies by the People's Bank of China ("PBOC"), which adversely affected the business of many customers of the Company, and (ii) a loss of certain orders due to labor shortages resulting from longer delays in the workforce returning following the Chinese New Year holiday as compared to the same period in 2010. As reported by Chinese media sources, the problem of workers not returning to work was more pronounced in the YRD region this year compared to the prior years.
Color cartons accounted for 28.6% of total revenues for in the second quarter of 2011 and flexo cartons accounted for 71.4%, compared to 27.7% and 72.3%, respectively, in the same period of 2010. Average per square meter prices for color cartons and flexo cartons during the second quarter of 2011 were $0.46 and $0.39, respectively, as compared to $0.43 and $0.37, respectively, for the same period of 2010.
Consumer and industrial goods manufacturing sectors are the Company's principal markets. Its major customers remained home appliances and electronics manufacturers and food, beverage and cigarette manufacturers in the YRD, which accounted for 22.2% and 23.9%, respectively, of the total revenues in the second quarter of 2011.