China Trading Stocks

[kindama]

Re: OSN

The CFO has explained to me that capacity is not a fixed number of tonnes, but varies depending on the exact product specifications of a customer order and the degree of processing required. The 20-F says the company was operating at 100% capacity for 2013, yet 2014 YTD revenues are up 49% over 2013 because they have been selling some lower spec product.

As an example, the plant may apply 10 processes to steel wire. An order might require 100% of capacity at one step, but only 75% of capacity at another. The company should be able to modestly boost overall capacity by focusing on these bottlenecks.