Date
13 December 2017
Zhang Yin says Nine Dragons is targeting US$500 million in exports by the end of the year. Photo: HKEJ
Zhang Yin says Nine Dragons is targeting US$500 million in exports by the end of the year. Photo: HKEJ

Nine Dragons to boost exports to counter weak renminbi

Nine Dragons Paper Holdings Ltd. (02689.HK) is ramping up exports to offset the impact of a weak Chinese currency.

Also, the company is trying to cushion the blow from an impending increase in US interest rates which will affect its US dollar-denominated debts.

Nine Dragons is targeting US$500 million in exports by the end of the year, mainly to Southeast Asia, the Hong Kong Economic Journal reports, citing chairperson Zhang Yin.

It plans to increase its procurement of recycled paper from domestic suppliers.

At present, Nine Dragons sources 45 percent of its recycled paper supply domestically.

The company is seeking dollar-euro swap contracts to lessen the impact of a rising greenback given its relatively high debts denominated in the US currency.

At the end of June, it owed 12.2 billion yuan (US$1.91 billion) and 2 billion yuan in US dollar and euro debt, respectively.

Zhang said the company is seeking to lower its gearing ratio to 80 percent next year from 94 percent at present.

That would cut its liabilities to 29 billion yuan from 33 billion yuan.

[Chinese version中文版]

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