 2012-07-23 |
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[By Yih-Lang Chou, Economic Daily News, Taipei]
YC (4306) Group President, Lee Chih-Hsien, stated yesterday (22nd) that although the global economy is weak, the group has completed its vertical integration and aims to solidify its position as the global leader in the adhesive tape industry within five years. By the end of the year, YC and its affiliate, ACHEM, will increase production capacity by 10% to 20%, and Xinzhou Global will expand to 55 stores, making next year’s operations highly promising.
To reassure investors of YC Group's commitment to becoming the global adhesive tape leader, Lee Chih-Hsien, along with the CFO and other senior executives, attended the "Listed Companies Investment Forum" organized by the Economic Daily News. Lee emphasized to the investors present, "I've invested everything in YC, so I must work hard to ensure YC Group achieves even better profitability."
Lee mentioned that despite the sluggish global economy, YC Group is striving for growth. The second half of the year will be a key period for expanding production across YC, ACHEM, and the newly established Xinzhou Global. The group has now become the world's only vertically integrated adhesive tape company, with YC producing tape raw materials, ACHEM manufacturing the tape products, and Xinzhou Global handling the retail of tape and other packaging materials.
YC's senior management indicated that the company’s Changbin plant in Taiwan introduced a new production line in December last year with a monthly output of 3,000 tons of BOPP (biaxially oriented polypropylene) film. The total monthly production capacity across Taiwan and China has increased from 10,000 tons in 2010 to 13,000 tons, a 30% increase. To meet the demand from key clients such as 3M, a seventh film production line is currently under construction and is expected to be operational by mid-next year.
ACHEM is expanding its production in Taiwan, China, and Vietnam simultaneously. The Yangmei plant in Taiwan will begin producing niche adhesive tapes in the fourth quarter. The Shanghai plant in China will add two new PVC tape production lines with a combined monthly capacity of 1.6 million square meters, expected to start production in the second half of the year. In Vietnam, new PVC and OPP tape production lines are being established, with monthly capacities of 800,000 square meters and 7.7 million square meters, respectively, also expected to commence in the fourth quarter.
Xinzhou Global currently has 10 stores in Taiwan and 19 in China, for a total of 29. The plan is to expand to 55 stores by the end of this year.
The group estimates that, with expansion and network building plans for YC, ACHEM, and Xinzhou Global this year, revenue growth for the group next year is highly expected.
Lee Chih-Hsien: The Worst is Over
YC (4306) Group President Lee Chih-Hsien said yesterday (22nd) that the worst period has passed, and as oil prices stabilize and rebound in the second half of the year, downstream restocking demand is expected to emerge, which will help drive steady growth in YC Group’s operations.
Speaking at the 'Listed Companies Investment Forum,' Lee noted that YC’s second-quarter revenue was NT$1.423 billion, down 4.56% from the first quarter’s NT$1.488 billion, due to a sharp drop in raw material prices in May and June, which led customers to place more conservative orders to minimize inventory losses. However, July and August will be critical months. If oil prices stabilize, the situation will become clearer, and downstream restocking demand will help propel steady growth in YC Group’s operations in the second half of the year.
In response to a question at the forum regarding whether YC would seek to increase foreign investment to enhance the group’s international profile and credibility, Lee said that the focus is currently on strengthening the company's profitability and ensuring consistent dividend payouts to investors. By doing this, YC will naturally attract foreign investors looking for stable investment opportunities.
There was also interest in whether YC would deepen its cooperation with 3M, the world’s largest adhesive tape company. Lee responded by saying that YC has already signed fixed-volume supply contracts with 3M, and the client is hoping to increase the supply. To meet this demand, YC is actively building the seventh film production line, which is expected to be completed by mid-next year, after which discussions with 3M about increasing supply can take place. |
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