 2003-10-03 |
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(Reported by Peng Xuanyi, Industrial Times, Taipei) OTC-listed plastic company YC (4306) saw rising prices for upstream raw materials such as resin adhesives during the third quarter. Downstream buyers, expecting price hikes, aggressively built up their inventories, creating a supply shortage in the resin adhesive market. Coupled with signs of recovery in the electronics industry, the market for plastic packaging materials has significantly warmed. As a result, September revenue is expected to exceed NT$200 million, setting a new historical high. Preliminary estimates for third-quarter consolidated group revenue (domestic and international) exceed NT$800 million, with a potential for pre-tax earnings per share to challenge NT$1.
YC’s operations focus on both Taiwan and mainland China plants, benefiting from a global economic recovery and rising chemical material prices. For the first eight months of the year, consolidated revenue increased by 14% compared to the same period last year, with pre-tax earnings reaching NT$115.39 million, and earnings per share of NT$2.07.
YC reports that its Taiwan plant achieved pre-tax earnings of NT$82.46 million for the first eight months, while its investment in the mainland Chinese company Asia Shuo (亞朔) contributed an estimated profit of NT$81.42 million. With Taiwan’s 44% stake, investment income from this holding amounted to approximately NT$35.83 million.
YC’s Taiwan plant maintains a monthly production capacity of 60 million square meters for OPP tape. The mainland China plant generates average monthly revenue of NT$100 million. The resin production lines in China have successfully started mass production as planned in May and June, with plans to expand further with a second BOPP production line by the end of the year. The new line will increase monthly production capacity to 4,600 tons, with expected annual revenue contribution of NT$900 million and a gross margin of around 25%. Internal estimates forecast an overall gross margin of 20% for the mainland plant this year, with total profits expected to reach NT$169 million. YC's parent company expects to recognize investment income of about NT$81 million from this holding. |
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