 2015-05-18 |
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Oversupply in China's Film Market: YC Reports Q1 Loss of NT$0.25, Marking Two Consecutive Quarters of Losses
Reporter Zhao Xiaohui, Taipei, 2015-05-16 11:16
Taiwan's leading tape manufacturer YC Group (4306-TW) reported a Q1 loss of NT$0.25 per share for this year, marking its second consecutive quarter of losses. This loss is larger compared to the NT$0.07 per share loss in the previous quarter and worse than the NT$0.12 per share profit from the same period last year. The primary reasons for this loss are the significant drop in crude oil prices since the second half of last year and an oversupply in the Chinese film market, which has led to a sharp decrease in prices and substantial losses from falling raw material prices.
The group's subsidiary ACHEM (1715-TW) reported a Q1 net profit of NT$0.17 per share, unchanged from the previous quarter but lower than the NT$0.30 per share profit from the same period last year. This decline is mainly due to investment losses from newly acquired shares in Ningbo Plant and Wanzhou Petrochemical.
Looking ahead to Q2, YC anticipates a rebound in operations as oil prices stabilize and market demand increases. The company also expects to turn a profit with gains from the sale of land in Linkou.
In terms of construction business profits, YC notes that the Xinzhuang "Wangzhou MORE" project is expected to start recognizing revenue in Q4 this year, while sales of the Linkou "Wangzhou Premium" project have exceeded 50%, with revenue recognition expected to continue into the second half of next year.
For ACHEM, the second quarter is expected to see growth in overall operations due to the gradual realization of vertical integration benefits and stable export orders. Additionally, with the Ningbo Plant's major international customer certifications completed and normal shipments beginning, ACHEM's operations are expected to improve compared to Q1.
In the second half of the year, ACHEM's operations are expected to surpass the first half due to the gradual ramp-up of production at the Hai'an Plant, increased shipments of new products such as PE, and improved performance from new specialized product capacities. |
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