Appliance maker Kolin goes `green'

Kolin Group Inc (歌林集團) yesterday unveiled a climate-friendly marketing plan it hopes will raise its profile among domestic consumers, who are becoming increasingly concerned with environmental issues.

In the face of rising energy costs and the threat posed by global warming, manufacturers across all sectors are keen to label their products and services "environmentally responsible."

Kolin manufactures consumer electronics and home appliances including DVD players, laundry machines, refrigerators and LCD TVs. Sales of air conditioners and LCD TVs accounted for about two-thirds of the company's sales last year, Kolin president Frank Lee (李敦仁) said.

Kolin's plan to mitigate its impact on the environment, developed in conjunction with National Ilan University, is to plant one tree for every direct current inverter air conditioner sold. The company expects to sell approximately 20,000 such units this year.

"We hope to play our part in protecting the environment. Our air conditioners use about 30 percent to 50 percent less energy than conventional units, which helps in terms of energy efficiency and reduces carbon emissions," Lee said.

In the domestic air conditioner market, Kolin has a market share of 10 percent to 11 percent, with 110,000 units sold last year. The company hopes to increase that figure by 10,000 units this year, said Chou Jiunn-Shyan (周俊賢), head of the company's general planning department.

Kolin's revenue soared 34.87 percent year-on-year to NT$21.21 billion (US$657.5 million) last year, a company filing to the Taiwan Stock Exchange showed last week. The combined sales of air conditioners, refrigerators and laundry machines totaled NT$3 billion last year, Chou said.

North America is a major market for Kolin's LCD TVs, accounting for 90 percent of its 1.2 million units sold last year under the "Olevia" brand name, the company said. Kolin predicts that number will rise to 1.5 million units this year.

"That target growth in LCD TV sales is attainable, because the general outlook for this market segment is strong this year, and because the Olympic Games may result in a wave of buyers looking to replace or upgrade their televisions in North America," said Liao Jun (廖景濬), an analyst with Polaris Securities (寶來證券).

The Olympic Games will be broadcast in full-high definition format this year. This, together with the arrival of next generation DVDs on the market, is expected to boost demand for LCD TVs above 40 inches in size, according to a report by the IDC last month.

Kolin stocks traded at NT$11.85 on the Taiwan Stock Exchange yesterday, up 6.76 percent from the day before. The stock surged by 13.95 percent over the last two trading sessions.

However, fierce competition means that the profit margin on LCD TVs is very slim and investors may be more interested in Kolin's real estate assets and development plans, with the group on course to open a new shopping center in Taipei County early next year, Liao said.

The company said last year that it plans to develop a shopping center in Sinjhuang (新莊), after the Taipei County Government announced that the area would become its second administrative center.