 2015-01-12 |
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YC Reports Slight Revenue Increase; Falling Oil Prices Increase Pressure on Film Business
MoneyDJ News, January 9, 2015, 18:07:44
Taiwan's adhesive tape leader YC Group (4306) reported a consolidated revenue of NT$1.64 billion for December 2014, up 1.5% from the previous month. For the entire year, consolidated revenue was NT$19.99 billion, reflecting a year-over-year growth of 1.89%. The group's subsidiary, ACHEM (1715), reported a consolidated revenue of NT$950 million for December, up 7.34% from the previous month. For the year, consolidated revenue was NT$10.98 billion, a year-over-year increase of 4.44%. Another subsidiary, Xinzhou Global (3171), reported a consolidated revenue of NT$159 million for December, down 4.1% from the previous month. For the year, consolidated revenue reached NT$1.78 billion, a 9.88% increase year-over-year.
YC Group stated that ACHEM's December revenue increased to NT$950 million due to the gradual recovery of production at its Ningbo plant's OPP production line, stabilization in the Chinese OPP market, and the recovery of export markets in the U.S. and Japan, along with a depreciating NT dollar. Despite market fluctuations in China, ACHEM's annual revenue for 2014 grew by 4.44% year-over-year, thanks to stable growth in orders from the Americas and Asia (excluding China) and the shipment of new products. The company anticipates that with the addition of the Yangmei PE plant and the Haian plant in China this year, combined with the benefits of vertical integration, overall operations will show a gradual recovery and growth trend.
Regarding Xinzhou Global, YC Group noted that after integrating its packaging materials business, operational benefits have emerged in Taiwan. Additionally, the "Bao Dashi" operations in China have shown gradual growth and started achieving monthly profitability. Expansion into Central and Northern China is planned, and future growth for Xinzhou Global is anticipated.
YC indicated that due to persistently low oil prices and the risk of further declines, its film business faces performance challenges. Additionally, the construction business could not recognize revenue due to IFRS accounting adjustments, resulting in less-than-ideal performance for the year. If oil prices continue to decline, operations may face even more severe challenges.
Looking ahead, YC expects that despite sluggish demand in the Chinese market and intense industry competition, ACHEM will benefit from new products and vertical integration, leading to stable revenue and profit growth. Xinzhou Global will continue expanding its packaging materials channel in Taiwan and China, with performance expected to increase. However, despite benefiting from the growth of these two subsidiaries, YC's film business will face significant pressure from falling oil prices, presenting challenges for future revenue and profit growth. |
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