Tong Yang Industry Co (東陽實業), which supplies automotive metal sheets and bumpers to global brands, yesterday reported that its pretax profit last month declined 14.51 percent year-on-year to NT$271 million (US$9.04 million), mainly due to foreign-exchange losses.
Aggregate pretax income in the first 11 months of this year fell 1.9 percent to NT$2.71 billion on an annual basis, with pretax earnings per share of NT$4.37, the company said in a statement.
Tong Yong, one of the world’s largest aftermarket automotive component suppliers, attributed the sluggish earnings performance to a NT$13.67 million foreign-exchange loss last month, saying that mounting losses have reached nearly NT$206 million so far this year because of the appreciation of the New Taiwan dollar against the US dollar.
North America remains the largest revenue contributor to the Tainan-based company’s after-sales parts division, accounting for nearly 65 percent of total sales, company data showed.
Despite the decrease in earnings, Tong Yang gave a relatively positive business outlook for next year, considering the sustained global demand for automotive components.
The company posted sales of NT$2.33 billion for last month, a 7.04 percent increase year-on-year, with aggregate revenue rising 1.63 percent annually to NT$22.34 billion in the first 11 months of the year.
To further cement its position in the global automaker supply chain, Tong Yong said it has been doing research and development on high-value-added products, such as brushless motors and eco-friendly products featuring waterborne coatings.
The company allocated a capital budget of more than NT$1.5 billion to develop new molds for the whole of this year, in a bid to sustain its competitiveness, it said.
As part of its mid-term plan, the company aims to continue investing in China, eyeing the business potential in the original equipment manufacturer (OEM) market there.
Teaming up with Changchun Faway Automobile Components Co Ltd (一汽富維), Tong Yang’s new plants in Shandong Province’s Qingdao and Hebei Province’s Tianjin are set to start mass production in the first half of next year.
Tong Yang, which entered the Chinese market in 1994, has invested US$153 million in its 15 OEM plants and one aftermarket parts plant in China in collaborations with Chinese car brands, such as Guangzhou Automobile Group (廣汽集團) and FAW Group (一汽集團).
Tong Yang shares yesterday remained unchanged at NT$57.6 in Taipei trading after the release of the company’s latest earnings results.
The stock has dropped 9.29 percent this year, compared with the broader market’s 13.38 percent increase over the same period, Taiwan Stock Exchange data showed.
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