 2015-11-05 |
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YC (4306) Group completed its headquarters building yesterday (4th). President Li Zhixian stated that the group's profits this year have fallen short of expectations due to overcapacity in China and declining oil prices. As a result, the group has undertaken structural adjustments for YC, Achem, and Shin Kong, which are expected to yield benefits starting next year. The group will focus on increasing utilization rates and expanding its customer base.
The three publicly listed companies under YC Group—YC, Achem, and Shin Kong—have undergone organizational restructuring this year. This includes transferring YC’s OPP film division to Achem, positioning Achem's core value around tape manufacturing, while YC transitions into a holding company. Shin Kong will be responsible for the development of tape distribution channels.
Achem Chairman Lin You-sheng stated that the company's major focus this year has been the vertical integration of OPP and PVC tape production. To fully support utilization rates in 2016 and 2017, Achem must actively seek out orders, with a goal of achieving 15% annual revenue growth next year. He is optimistic about the stable recovery of the U.S. market, which is expected to drive strong demand for adhesive tape. Yesterday, YC's stock price increased by NT$0.05, closing at NT$12.1.
Analysts estimate that this quarter is a low season for shipments, which will slow down revenue growth. Throughout the year, revenue was affected by declining oil prices, leading to a drop in average product prices. The annual revenue is estimated to be around NT$11.8 billion, with a year-on-year growth of about 7.2%. However, net profit after tax is expected to decrease by 1.4 times to NT$290 million, with earnings per share (EPS) of NT$0.7. Next year, EPS is expected to rise to NT$1.
Shin Kong Chairman Jiang Wen-rong mentioned that over the past six months, the company has adjusted its development strategy in China, shifting away from expanding physical locations and instead focusing on acquiring stable large enterprise customers. This year, the company has added two to three new customers, boosting revenue performance. Additionally, the decline in raw material costs has created favorable price differentials in sales channels, leading to an optimistic outlook for this year's operations.
Looking ahead to next year, Shin Kong plans to target major Chinese companies in the panel and mobile phone industries, expecting large-scale shipments next year. The company also plans to add two to three more customers. |
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