 2015-11-25 |
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Xinzhu Global (3171) reported a profit of 0.23 billion NT dollars in the third quarter, with earnings per share (EPS) reaching 0.4 NT dollars, a year-on-year growth of over 30%. For the first three quarters of the year, total profit amounted to 0.75 billion NT dollars, with an EPS of 1.27 NT dollars, marking a 54% year-on-year increase and surpassing last year’s total profit. Chairman Jiang Wenrong stated today that with the Chinese market expected to perform exceptionally well next year, the company’s profit growth momentum is promising.
Jiang Wenrong mentioned that the short-term goal is to focus on growth in the Chinese market. This year, due to inventory clearance and bad debts in China, there was minimal profit contribution. However, with these bad debts resolved and new customer contributions starting in the first quarter of next year, profit in the Chinese market is expected to grow significantly. The five-year goal is for profit contributions from China to match those from Taiwan, with a projected EPS contribution of 1.5 NT dollars from Taiwan this year, indicating robust profit growth potential for the company.
The strong profit performance of Xinzhu Global in the first three quarters of this year is attributed to a major strategic shift in the Chinese market. Previously, Xinzhu Global sought to expand its channels and find customers in China, but varying customer scales led to stagnation and increased bad debt risks. The company decided to target large, high-profile customers instead. Although revenue growth appears modest, profit margins have significantly improved. In addition, Xinzhu Global has increased the added value of its products in Taiwan and raised the proportion of multiple processing stages, leading to substantial profit growth despite modest revenue increases. The company’s net asset value has risen to 10.31 NT dollars per share, enabling it to regain credit trading qualifications.
Looking ahead, Xinzhu Global is expected to have clear growth momentum. In Taiwan, the company plans to develop the previously overlooked Hualien and Taitung areas to maintain a higher market share. In China, besides changing its business strategy and focusing on large key customers, Xinzhu will also expand to new locations in Guangdong and Shandong. The company has already secured large orders from wire and optoelectronics industries and expects to start shipments in the first quarter of next year. With these developments, both revenue and profit in the Chinese market are projected to see substantial growth. |
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