Nan Ya Plastics Corp (南亞塑膠), a major unit of Formosa Plastics Group (台塑集團), yesterday said it expects revenue this quarter to grow from last quarter, despite market volatility amid an escalating US-China trade war.
“Nan Ya’s electric material and plastics segments are expected to see their revenue increase this quarter [from last year], as the markets are entering peak season,” company chairman Wu Chia-chau (吳嘉昭) told a news conference in Taipei.
The company also expects ethylene glycol prices to rebound in the second half of this year from about US$900 per tonne, supported by continuing demand for polyester in the Chinese market, Wu said.
Ethylene glycol inventories have remained low in China and restocking demand is likely to continue to stimulate sales this quarter, he added.
The three other main units of Formosa Plastics Group yesterday provided mixed outlooks for this quarter amid growing uncertainty stemming from a trade spat between the world’s two largest economies.
Formosa Chemicals & Fibre Corp (台灣化學纖維), which manufactures petrochemical products ranging from purified terephthalic acid and styrene monomer to nylon fiber, said it expects sales to increase this quarter from last quarter amid robust customer demand.
However, some of the company’s clients have since last month become hesitant to place orders because of the US-China trade war, Formosa Chemicals vice chairman Hong Fu-yuan (洪福源) told reporters.
FPC GLUM ON SALES
Meanwhile, Formosa Plastics Corp (FPC, 台塑) is likely to see sales decrease this quarter from last quarter due to lower outputs over the period, company president and chairman Jason Lin (林健男) said.
FPC expects its factory utilization rate to fall to 89 percent this quarter from 93 percent last quarter, as some plants are to undergo regular maintenance.
Formosa Petrochemical Corp (台塑石化), the group’s oil refinery arm, did not elaborate on its sales target, but said it is unlikely that oil prices would surpass US$80 per barrel in the near term.
Formosa Petrochemical president Tsao Minh (曹明) expects crude oil prices to reach between US$75 and US$80 per barrel this quarter, slightly up from about US$74 per barrel last quarter.
The group’s four benchmark units all posted double-digit annual growth in net profit for the first half of this year, benefiting from crude oil price hikes, with Nan Ya posting the highest growth.
Nan Ya said net profit soared 51.4 percent annually to NT$30.13 billion (US$991.02 million) and revenue increased 14.9 percent to NT$168.67 billion.
FPC saw net profit grow 48.1 percent annually to NT$29.04 billion and revenue increase 16.5 percent to NT$116.64 billion, while Formosa Chemicals reported a net profit of NT$27.3 billion, up 35.4 percent from a year earlier, while sales rose 15.9 percent to NT$198.65 billion.
Formosa Petrochemical posted a net profit of NT$43.52 billion, up 25.5 percent from a year earlier, while revenue over the period rose 23.4 percent to NT$374.4 billion, data showed.
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