Mon, Feb 25, 2019 - Page 15 News List

Makalot profit boosted by high sales

By Chen Cheng-hui  /  Staff reporter

Makalot Industrial Co Ltd (聚陽) reported that pretax profit last month rose 56.25 percent to NT$200.4 million (US$6.5 million) from NT$128.26 million in January last year, thanks to rising shipments and better product prices.

Pre-tax earnings per share reached NT$0.96, based on the company’s 209 million outstanding shares, the company said in a filing with the Taiwan Stock Exchange on Thursday last week.

Makalot, a manufacturer of ready-to-wear apparel and functional clothing, said that revenue on a consolidated basis totaled NT$2.14 billion last month, a 35.91 percent increase from NT$1.58 billion in the same month last year.

Revenue reached 35 percent of JPMorgan Securities (Taiwan) Ltd’s first-quarter estimate, with the strong growth momentum likely to remain in the rest of this quarter, the brokerage said.

“The solid momentum was driven by growing demand from US and Japanese clients that enable Makalot to be selective on orders given limited capacity,” JPMorgan said in a note.

Makalot counts GAP Inc, Fast Retailing Co’s GU sub-brand, Kohl’s Corp, Target Corp, Walmart Inc and Hanesbrands Inc among its major clients.

With clear order momentum from its top clients, Makalot’s revenue for this quarter is forecast to increase by 5.54 percent to NT$6.44 billion from last quarter and net profit would improve from NT$370 million to NT$438 million over the period with earnings per share of NT$2.09, Jih Sun Securities Investment Consulting Co (日盛投顧) said.

Other textile and garment manufacturers also reported better-than-expected revenue last month, despite a low season, while saying that they have seen order visibility through the third quarter.

Eclat Textile Co (儒鴻) posted revenue of NT$2.42 billion last month, up 0.27 percent from a year earlier and the highest January figure in the company’s history, while Quang Viet Enterprise Co (廣越) saw sales jump 98.31 percent to NT$893 million.

Eclat counts major global brands such as GAP, Target, Nike Inc, Lululemon Athletica Inc and Under Armour Inc among its top clients.

Full-year sales grew 13.82 percent annually to NT$27.58 billion last year, company data showed.

Analysts said that the company’s ramp-up of capacity utilization at its plants in Vietnam has been completed and its persistent growth in the number of its clients might benefit order scale and client mix optimization.

Eclat could see orders rise steadily along with product prices as major brands continue to reduce the number of suppliers they work with and the trend of lightweight products continues, they added.

“We expect Eclat’s second-half growth in 2019 to outpace that in the first half due to a favorable base of comparison and full capacity utilization,” JPMorgan said.

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