 2012-06-13 |
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Economic Daily News / Reporter Xuan-Yi Peng / Taipei Report
In May, falling oil prices and a sharp reduction in petrochemical raw material costs led to weak demand for follow-up orders from downstream buyers. YC Group (4306), which operates in both the BOPP and adhesive tape sectors, saw a 4% month-over-month drop in revenue for May, though it still represented a 9.4% increase compared to the same month last year. However, its subsidiary focusing on adhesive tape, ACHEM (1715), managed to maintain a stable revenue with a 2.15% month-over-month increase and a 22.52% year-over-year growth in May.
YC noted that downstream inventory liquidation is expected to bottom out soon, with an anticipated rebound in stock replenishment. Signals of stabilization in crude oil and raw material prices will be indicators for operational recovery. As an upstream raw material supplier primarily for BOPP film, YC was significantly affected by the market's cautious attitude towards price increases amid the petrochemical price corrections in May. Consequently, YC's revenue growth was impeded.
Due to the ongoing European debt crisis and continued decline in international oil prices, downstream demand remains weak, contributing to a slight decrease in May's revenue. Nevertheless, thanks to stable volume and prices of adhesive tape products and the emerging benefits of the packaging channel 'Baodashi,' YC's consolidated revenue saw a slight increase for the month. |
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