Formosa Plastics Group (FPG, 台塑集團), the nation’s largest industrial conglomerate, is likely to give employees year-end bonuses equivalent to six months’ salary, FPG chairman William Wong (王文淵) said on Saturday.
As FPG’s bottom line was good in the first three quarters, the group might maintain its policy for Lunar New Year bonuses, Wong said.
In addition, FPG would be giving out red envelopes to employees to express its gratitude for their hard work, he said.
“The amount of cash in the red envelopes has not yet been decided,” Wong said at the group’s annual sports day.
The four major units of FPG — Formosa Plastics Corp (台塑), Nan Ya Plastics Corp (南亞塑膠), Formosa Chemicals & Fibre Corp (台灣化學纖維) and Formosa Petrochemical Corp (台塑石化) — posted a combined net profit of NT$206.8 billion (US$6.71 billion) in the first nine months of the year, up 22.9 percent from a year earlier, largely on rising product prices due to higher international crude oil prices.
Formosa Petrochemical, the second-biggest company by market capitalization on the Taiwan Stock Exchange, had the highest net profit among the four at NT$64.2 billion, a 12.8 percent increase from a year earlier, with earnings per share of NT$6.74.
Despite the units’ strong earnings in the first nine months, Wong said he is cautious about the fourth quarter and beyond, because of the trade tensions between the US and China.
“With no signs that either side will back down or that they will resolve the trade dispute soon, we have to prepare ourselves for challenges posed by trade issues,” he said.
FPG plants in China sell most of their products there, but some are shipped to the US, Wong said.
He said the group would keep a close eye on an expected meeting between US President Donald Trump and Chinese President Xi Jinping (習近平) at the G20 summit in Argentina this month.
The units on Monday last week reported top-line figures for last month, with Formosa Plastics the only firm to post a monthly growth in revenue, up 8.9 percent to NT$19.69 billion. Its revenue increased 18.7 percent from a year earlier.
In the same month, Nan Ya’s revenue declined 3.8 percent month-on-month, but rose 5.6 percent year-on-year to NT$27.51 billion.
Formosa Chemicals saw revenue drop 2.4 percent from the previous month to NT$36.07 billion, but the figure was up 13.9 percent from a year ago, while Formosa Petrochemical’s revenue fell 0.4 percent monthly, but expanded 30.2 percent annually to NT$68.26 billion.
Due to concerns over trade tensions and a possible cap on oil price hikes, the four units’ earnings this quarter are forecast to decline from peaks last quarter, despite higher sales and production volumes after completing maintenance, Capital Investment Management Corp (群益投顧) said.
“As downstream demand and oil price support have weakened recently, the prices of petrochemical products [are expected to] decline mostly,” Capital Investment said in a note on Tuesday last week.
“Furthermore, the gradual addition of ethane-based ethylene capacity in the US may weigh on the prices of ethylene and its downstream products in Asia,” Capital Investment said. “Coupled with a lack of non-operating cash dividends, fourth-quarter net profits of FPG’s four major companies might decrease quarter-on-quarter.”
Additional reporting by Chen Cheng-hui
RUN IT BACK: A succesful first project working with hyperscalers to design chips encouraged MediaTek to start a second project, aiming to hit stride in 2028 MediaTek Inc (聯發科), the world’s biggest smartphone chip supplier, yesterday said it is engaging a second hyperscaler to help design artificial intelligence (AI) accelerators used in data centers following a similar project expected to generate revenue streams soon. The first AI accelerator project is to bring in US$1 billion revenue next year and several billion US dollars more in 2027, MediaTek chief executive officer Rick Tsai (蔡力行) told a virtual investor conference yesterday. The second AI accelerator project is expected to contribute to revenue beginning in 2028, Tsai said. MediaTek yesterday raised its revenue forecast for the global AI accelerator used
TEMPORARY TRUCE: China has made concessions to ease rare earth trade controls, among others, while Washington holds fire on a 100% tariff on all Chinese goods China is effectively suspending implementation of additional export controls on rare earth metals and terminating investigations targeting US companies in the semiconductor supply chain, the White House announced. The White House on Saturday issued a fact sheet outlining some details of the trade pact agreed to earlier in the week by US President Donald Trump and Chinese President Xi Jinping (習近平) that aimed to ease tensions between the world’s two largest economies. Under the deal, China is to issue general licenses valid for exports of rare earths, gallium, germanium, antimony and graphite “for the benefit of US end users and their suppliers
Dutch chipmaker Nexperia BV’s China unit yesterday said that it had established sufficient inventories of finished goods and works-in-progress, and that its supply chain remained secure and stable after its parent halted wafer supplies. The Dutch company suspended supplies of wafers to its Chinese assembly plant a week ago, calling it “a direct consequence of the local management’s recent failure to comply with the agreed contractual payment terms,” Reuters reported on Friday last week. Its China unit called Nexperia’s suspension “unilateral” and “extremely irresponsible,” adding that the Dutch parent’s claim about contractual payment was “misleading and highly deceptive,” according to a statement
Artificial intelligence (AI) giant Nvidia Corp’s most advanced chips would be reserved for US companies and kept out of China and other countries, US President Donald Trump said. During an interview that aired on Sunday on CBS’ 60 Minutes program and in comments to reporters aboard Air Force One, Trump said only US customers should have access to the top-end Blackwell chips offered by Nvidia, the world’s most valuable company by market capitalization. “The most advanced, we will not let anybody have them other than the United States,” he told CBS, echoing remarks made earlier to reporters as he returned to Washington
RSS