Thu, Apr 05, 2018 - Page 11 News List

YFY increases dividend after profit skyrockets

By Kuo Chia-erh  /  Staff reporter

Papermaking conglomerate YFY Inc (永豐餘控股) last week announced a cash dividend of NT$0.6 per common share, the highest since 2012, after its net profit last year skyrocketed 1,176 percent to NT$1.61 billion (US$55.24 million), from NT$126.12 million in 2016.

Earnings per share were NT$0.97 last year, compared with NT$0.08 in 2016, the company said at an investors’ conference on Wednesday last week.

Revenue rose 5.4 percent annually from NT$63.35 billion to NT$66.77 billion, with gross margin increasing from 16.6 percent in 2016 to 17.98 percent, company data showed.

That caused operating income to surge 165.6 percent from NT$1.11 billion to NT$2.96 billion, the data showed.

The significant improvement of the company’s bottom line was partly due to China’s stricter environmental standards for papermakers, which boosted prices of industrial paper products in that market, YFY said.

The company’s industrial paper segment reported operating income of NT$1.31 billion last year, compared with a net loss of NT$667 million in 2016, while income generated by its pulp business almost doubled from NT$413 million to NT$822 million.

However, YFY said earnings from its household paper division last year plunged 86.1 percent to NT$55 million, from NT$396 million a year earlier, despite an upward trend in global pulp prices.

The company said it did not fully reflect soaring material costs in products, given high price sensitivity in the household paper market.

The conglomerate also attributed its earnings performance to income generated by profitable reinvestment units, including Shin Foong Specialty and Applied Materials Co Ltd (申豐) and TaiGen Biopharmaceuticals Holdings Ltd (太景醫藥研發控股).

Taipei-headquartered YFY has capacity to produce 1.037 million tonnes of pulp and 1.66 million tonnes of industrial paper products each year through its plants in Taiwan, China and Vietnam, company data showed.

Separately, YFY’s listed papermaking subsidiary, Chung Hwa Pulp Co (中華紙漿), reported that net income grew almost 60 percent from NT$391.11 million in 2016 to NT$618.58 million last year.

Revenue reached a record high of NT$22.71 billion last year, a 3.2 percent increase from NT$22 billion the previous year, while gross margin gained 1.65 percentage points from 8.53 percent to 10.18 percent.

Chung Hwa Pulp said its management team has proposed a cash dividend of NT$0.50 based on last year’s earnings per share of NT$0.56, up from NT$0.35 in 2016.

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