Sat, Sep 02, 2017 - Page 12 News List

Taiwan Pulp to concentrate on chemical plants

By Kuo Chia-erh  /  Staff reporter

Taiwan Pulp and Paper Corp (TPPC, 台灣紙業) yesterday said it is shifting its business focus from papermaking to producing high-added-value chemicals, with a new plant set to begin producing hydrochloric acid for semiconductor companies and LCD panel makers by the end of this year.

The new chemicals plant, which is being built in Tainan’s Sinying District (新營), is expected to manufacture between 400 tonnes and 420 tonnes of hydrochloric acid per month, the company said.

“We have been producing chemicals for years and expect the new products to be the main sales drivers for the company next year,” TPPC chairman Phil Hsu (許良宇) told reporters after an investors’ conference in Taipei.

Citing a high entry threshold, Hsu said hydrochloric acid for use in the electronics industry — which is especially widely used in integrated circuit manufacturing — tends to have a better profit margin than other chemicals in the company’s product portfolio.

The company already runs a chemicals plant in Sinying and produces potassium carbonate, potassium hydroxide and liquid chlorine, the company’s data showed.

Hsu said he is confident that the company would see growth in revenue generated by chemicals this year.

He declined to elaborate on any sales targets.

The new business strategy came after the company folded up its unprofitable papermaking business in Taiwan, the company said.

Last year, TPPC closed its pulp and paper operation in Tainan, as aging facilities led to losses of nearly NT$1.75 billion (US$58 million) over the past five years, company data showed.

However, the company said it would continue to expand its footprint in Vietnam’s emerging papermaking industry, hoping to grab more business opportunities there.

Cheng Yang Paper Mill Co Ltd — in which TPPC holds a 27 percent stake — is to raise its production capacity from 100,000 tonnes of industrial paper per year to 440,000 tonnes per year in the near term, TPPC said.

TPPC reported a net profit of NT$90.5 million in the first half of the year, an 81 percent jump from NT$49.96 million in the same period last year, but revenue plunged 31 percent to NT$1.46 billion from NT$2.12 billion over the same period, company data showed.

The company, which found itself in a bitter management struggle at the beginning of this year, attributed its mixed performance to an ongoing reorganization.

TPPC shares rose 5.58 percent to NT$22.7 in Taipei trading yesterday, beating the broader market, which edged up 0.09 percent to 10,594.82 points.

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