Falling crude oil prices continued to torment Formosa Plastics Group (台塑集團), as the four main companies under the nation’s largest industrial conglomerate yesterday reported drops in last month’s revenues.
The aggregate revenue of the four units — Formosa Plastics Corp (FPC, 台灣塑膠), Formosa Petrochemical Corp (台塑石化), Nan Ya Plastics Corp (南亞塑膠) and Formosa Chemicals & Fibre Corp (台灣化學纖維) — totaled NT$115.6 billion (US$3.64 billion) last month, down by 12 percent month-on-month and 33 percent year-on-year, according to the companies’ separate filings with the Taiwan Stock Exchange.
Among the four major units, Formosa Petrochemical, the nation’s only private oil refiner, saw the most precipitous drop due to declining crude prices.
Revenue plunged by 46.4 percent from a year ago and 24.2 percent from June to NT$47.78 billion last month, the lowest monthly level in four years, company data showed.
That was because Dubai crude oil prices last month fell by US$5.6 per barrel to US$56.2 from June and its average selling prices declined by US$6.9 per barrel, Formosa Petrochemical said.
The company said its average refined oil output last month dropped by 180,000 barrels to 364,000 barrels per day, while shipments of refined products slid by 5.7 million barrels to 12.6 million barrels.
FPC, the group’s flagship unit and the nation’s largest producer of polyvinyl chloride, reported that its revenue dropped by 20.4 percent annually and 1.8 percent monthly to NT$15.89 billion last month.
FPC attributed last month’s lower revenue to annual declines of 47.1 percent, 21.6 percent and 38 percent in Dubai crude oil prices, ethylene and propene prices respectively, which compelled the company to slash prices for its product mix.
Furthermore, ethylene-vinyl acetate sales were impacted by price competition from Samsung Group’s petrochemical arm, which caused FPC’s sales to decrease by 9,000 tonnes, or NT$490 million, from June.
Nan Ya Plastics Corp, the nation’s largest plastics maker, posted revenue of NT$24.45 billion last month, down by 17.47 percent year-on-year and 6.63 percent month-on-month, due to steep declines in sales of bisphenol A and ethylene glycol.
In particular, ethylene glycol prices in China last month fell sharply amid oversupply, Nan Ya said its filing. In addition, production capacity diminished last month as a number of the company’s plants have begun annual maintenance, it added.
Formosa Chemicals & Fibre, which produces aromatics and styrenics, reported that revenue fell by 24.1 percent annually and 3.3 percent monthly to NT$27.74 billion last month.
“The prices of petrochemical products have continued to fall along with crude oil prices, which is due to persistent oversupply, and growing misgivings over global economic prospects,” the firm said in its filing.
Overall, the combined revenue of the four major units decreased by 22.3 percent year-on-year to NT$886.6 billion in the first seven months of the year.
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