HARBIN, China, March 18, 2017 /PRNewswire/ -- China XD Plastics
Company Limited (NASDAQ: CXDC) ("China XD Plastics" or the
"Company"), one of China's leading
specialty chemical players engaged in the development, manufacture
and sale of modified plastics primarily for automotive
applications, today announced the official signing of an agreement
with the People's Government of Shunqing District, Nanchong City of
Sichuan Province for the production of 300,000 metric tons of
bio-composite materials and additive manufacturing and 20,000
metric tons of functional masterbatch, a high-end color additive
process in plastics manufacturing (the "Project").
"The official signing of the agreement of the Project is another
milestone for the company," said Jie
Han, Chairman and CEO of China XD Plastics. "The Project
will help the Company expand its product mix from traditional
petroleum-based materials to bio-based composite, 3D printing and
functional masterbatch materials, paving the path to non-auto
applications and further diversify our company's business as a key
element of our strategic plan."
In its 'Made in China 2025' and
'The Thirteenth Five-Year Plan', the Chinese government has
highlighted bio-composite materials and additive manufacturing
materials as key planning technology areas and clearly stated the
importance of strengthening research and development in bio-based
polymer materials, developing bioplastics packaging, bio-plastic
auto parts and other areas, with nation-wide initiative in supply
side reform to promote the field of additive manufacturing
materials. In December 2016,
encouraged by the strong demand and market potential for
bio-composite materials, additive manufacturing and functional
masterbatch, the Company's Board of Directors preliminarily
approved the Company's strategic investment in these
initiatives.
After initial approval by the Board of Directors and the
Company's major investor on December 8,
2016, Sichuan Xinda entered into a strategic investment
agreement with Shunqing Government, Nanchong City, Sichuan Province, on December 12, 2016. Due to the uncertainty of
securing the necessary land use rights for the project, the Company
waited until March 13, 2017 and
entered into a "Land Use Right Transfer Agreement" with the
government agency, formalizing its initial dialogue, and entered
into a definitive agreement after approval by the Board of Director
and its major shareholder. The Project will be located in a land
area of 250 mu (equivalent to 41.2 acres), where 215 mu will be
designated for bio-composite materials and additive manufacturing
production and 35 mu will be designated for functional masterbatch
production. The projected total capital expenditures for the
project is approximately 2.5 billion
RMB (estimated to be $357
million) with anticipated completion by the end of
December 2018. The Project will add
320,000 metric tons capacity and the Company will also benefit from
favorable tax policies under China's Go West Campaign by locating the
Project in Southwest China.
About China XD Plastics Company Limited
China XD Plastics Company Limited, through its wholly-owned
subsidiaries, develops, manufactures and sells polymer composites
materials, primarily for automotive applications. The Company's
products are used in the exterior and interior trim and in the
functional components of 29 automobile brands manufactured in
China, including without
limitation, AUDI, Mercedes Benz,
BMW, Toyota, Buick, Chevrolet, Mazda, Volvo, Ford, Citroen, Jinbei
and VW Passat, Golf, Jetta, etc. The Company's wholly-owned
research center is dedicated to the research and development of
polymer composites materials and benefits from its cooperation with
well-known scientists from prestigious universities in China. As of December
31, 2016, 402 of the Company's products have been certified
for use by one or more of the automobile manufacturers in
China. For more information,
please visit the Company's English website at
http://www.chinaxd.net, and the Chinese website at
http://www.xdholding.com.
Safe Harbor Statement
This announcement contains forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. All statements other than statements
of historical fact in this announcement are forward-looking
statements, including but not limited to, the Company's growth
potential in international markets; the effectiveness and
profitability of the Company's product diversification strategy;
the impact of the Company's product mix shift to more advanced
products and related pricing policies; the effectiveness,
profitability, and the marketability of its the ongoing mix shift
to more advanced products; and the prospect of the Company's
Southwest China facility, and its
penetration into Southwest China. These forward-looking
statements can be identified by terminology such as "will,"
"expect," "project," "anticipate," "forecast," "plan," "believe,"
"estimate" and similar statements. Forward-looking statements
involve inherent risks and uncertainties and are based on current
expectations, assumptions, estimates and projections about the
Company and the industry. A number of important factors could cause
actual results to differ materially from those contained in any
forward-looking statement. Potential risks and uncertainties
include, but are not limited to, the global economic uncertainty
could further impair the automotive industry and limit demand for
our products; fluctuations in automotive sales and production could
have a material adverse effect on our results of operations and
liquidity; our financial performance may be affected by the
prospect of our Dubai facility and
the associated expansion into Middle
East, Europe and other
parts of Asia; the withdrawal of
preferential government policies and the tightening control over
the Chinese automotive industry and automobile purchase
restrictions imposed in certain major cities may limit market
demand for our products; the slowing of Chinese automotive
industry's growth; the concentration of our distributors, customers
and suppliers; and other risks detailed in the Company's filings
with the Securities and Exchange Commission and available on its
website at http://www.sec.gov. The Company undertakes no obligation
to update forward-looking statements to reflect subsequent
occurring events or circumstances, or to changes in its
expectations, except as may be required by law. Although the
Company believes that the expectations expressed in these forward
looking statements are reasonable, it cannot assure you that its
expectations will turn out to be correct, and investors are
cautioned that actual results may differ materially from the
anticipated results.
Contacts:
China XD Plastics
Mr. Taylor Zhang, CFO (New York)
Phone: +1 (212) 747-1118
Email: cxdc@chinaxd.net
Investor Relations: Citigate Dewe Rogerson
Ms. Vivian Chen, Managing
Director
US: +1 (347) 481-3711
Email: Vivian.chen@citigatedr.com
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SOURCE China XD Plastics Company Limited