ZC Rubber profits slump as raw-material costs rise 21%

Hangzhou, China – Zhongce Rubber (ZC Rubber) has reported a 65.3% year-on-year fall in third-quarter net profit, as rising raw-material costs and currency pressures squeezed margins despite higher tire sales.

Net profit attributable to shareholders fell to Yuan413.4 million (€56 million) in the three months to 30 Sept, while revenue increased 6.6% to Yuan12.60 billion, the Chinese tire maker reported 24 Oct.

ZC Rubber attributed the decline mainly to falling gross margins caused by "rising raw-material prices and the depreciation of the US dollar against the renminbi."

The company said it had "taken measures including raising selling prices," but these had "not yet fully offset the impact of the adverse factors."

In a separate operating statement, ZC Rubber reported that the combined purchase price of five key raw materials – natural rubber, synthetic rubber, carbon black, steel cord and tire cord fabric – rose 20.76% year-on-year and 6.57% quarter-on-quarter.

By comparison, average tire selling prices increased just 0.71% year-on-year and fell 5.69% compared with the second quarter, partly reflecting changes in product mix.

Tire sales volumes increased 8.65% to just over 31 million units during the quarter, while tire sales revenue rose 9.43% to Yuan11 billion.

In its separate bicycle and other small tire category, ZC Rubber reported a marginal decline in sales volumes to 32.3 million units, with revenue falling 12.5% to Yuan946.5 million.

For the first nine months of 2026, ZC Rubber reported revenue of Yuan36 billion, up 7.1% year-on-year.

Net profit attributable to shareholders fell 18.77% to Yuan2.85 billion over the nine-month period.