Tragedy Strikes China's Luxi Chemical Plant: Explosion at Hydrogen Peroxide Facility Claims Nine Lives and Sparks Market Turmoil
- 08-May-2023 2:11 PM
- Journalist: Xiang Hong
China: Luxi Chemical Group, a subsidiary of the Chinese state-owned chemicals company Sinochem Holdings, witnessed a decline in its stock prices following a fatal accident at its Hydrogen Peroxide plant, which claimed the lives of nine individuals. As a result, the company's shares plunged by the daily limit of 10%, and ultimately closed 6.1% down at CNY11.26 (USD1.64).
Luxi Chemical, a unit of Liaocheng Luxi Hydrogen Peroxide New Material, disclosed on May 1 that nine individuals lost their lives, one person was injured, while one individual is still missing, following an explosion that occurred in the production lines. The parent company, based in Shandong province, reported that efforts to rescue survivors are still underway.
Luxi Chemical has reported that it quickly initiated its emergency plan and collaborated with local authorities to respond to the accident. The company informed that by noon on May 1, the fire had been extinguished, the leak had been sealed, and the environmental protection department had verified that the surrounding atmosphere was back to normal.
Luxi Chemical is yet to determine the financial impact of the recent accident. The company's subsidiary, Luxi Hydrogen Peroxide, which was established in August 2019, operates seven production lines with the capability to manufacture 400,000 tons of Hydrogen Peroxide annually. In 2019, the subsidiary generated a revenue of CNY1.1 billion (USD159.4 million), which accounted for 3.6 percent of Luxi Chemical's total revenue.
Luxi Chemical's recent earnings report shows a 76% decrease in net profit to CNY 322 million (USD 46.6 million) in Q1 compared to the same period last year. Additionally, the company's revenue dropped by 14%, totalling CNY 6.6 billion.