 2014-10-11 |
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By Zhou Yi-Lang, Taipei
Taiwan's leading adhesive tape company, YC (4306), announced that its CFO, Lin Jian-Yu, expects steady growth in Q4. The growth will be driven by new production capacities and product shipments from its subsidiary ACHEM (1715), as well as the expansion of packaging material channels by Xinzhou (3171) in Taiwan and China. As ACHEM Chemicals' production capacity gradually increases, YC's parent company will benefit from the operational growth of its three subsidiaries, leading to a stable growth in Q4 performance, expected to surpass the previous quarter.
For September, YC reported a consolidated revenue of NT$1.718 billion, a slight increase of 4.85% year-over-year. Cumulative revenue for the first three quarters of the year reached NT$15.12 billion, a 3.79% increase compared to the same period last year.
Revenue Growth for the First Three Quarters: 3.79%
The group's subsidiary, ACHEM Chemicals, reported a consolidated revenue of NT$872 million in September, a decrease of 2.9% year-over-year. For the first three quarters, cumulative revenue was NT$8.27 billion, a 6.23% increase year-over-year. Xinzhou Global achieved a consolidated revenue of NT$151 million in September, a 1.99% increase month-over-month. Cumulative revenue for the first three quarters was NT$1.305 billion.
Lin Jian-Yu explained that during a challenging third quarter for the Chinese OPP market, ACHEM accelerated its vertical integration of OPP production by relocating three OPP production lines from Shanghai to the Ningbo plant. The relocation is expected to be completed by the end of the year. The relocation led to a decrease in production and sales in September, coupled with inventory adjustments by some overseas customers delaying their orders. These issues are expected to normalize by mid-October.
Despite these challenges, ACHEM’s cumulative revenue for the first three quarters still showed a 6.23% increase year-over-year. This growth was driven by stable order increases in the Americas and China, and higher shipments of automotive and PVC (polyvinyl chloride) tapes, indicating the benefits of the company’s new production capacity.
For the fourth quarter, ACHEM's overall performance is anticipated to improve due to increased shipments of PVC tapes (automotive and protective types), the introduction of new PE (polyethylene) products, and steady growth in specialized businesses. Xinzhou Global has already shown improved operational efficiency in Taiwan following its packaging material business integration. The performance of its mainland China business, Bao Dashi, is also gradually improving with monthly profitability, suggesting promising growth for Xinzhou. Meanwhile, the group's invested company, ACHEM Chemicals, is still in the trial production stage for acrylic acid, with expectations for enhanced industry vertical integration benefits once mass production begins. |
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