Hsing Ta Cement Co (信大水泥) on Tuesday reported 70.81 percent annual growth in net profit last year, as increased demand boosted prices and gross margin.
Net profit last year soared to NT$840.24 million (US$27.19 million), compared with NT$491.91 million in 2017, while earnings per share rose from NT$1.32 to NT$2.38, the company said in a financial statement.
Gross margin jumped 32 percent, compared with 23 percent in 2017, marking the highest increase in five years.
The company said that it expects continued demand in Taiwan and China, as well as price hikes in China, to support a steady increase in revenue this year.
“Hsing Ta has been cultivating opportunities in the northern Yangtze River region. We have since early this year seen a rebound in demand due to public infrastructure projects,” a Hsing Ta public relations executive said on condition of anonymity.
Revenue last year rose 24.54 percent to NT$6.7 billion, from NT$5.38 billion in 2017, while revenue in the first quarter of this year rose 28.18 percent year-on-year to NT$1.36 billion.
The company attributed the growth in revenue to rising infrastructure needs across China and a stable housing market.
Production capacity in China rose 26 percent annually, while sales rose 30 percent, it said.
Cement prices in China last quarter increased more than twofold to NT$1,811 per tonne, compared with NT$852 three years ago, company data showed.
Beijing has set tougher environmental laws for sand extraction and air pollution, which drove up the cost of materials and cement production, the company said.
Cement sales in Taiwan last quarter fell 2 percent year-on-year, but production capacity rose 36 percent thanks to additional investment in the nation’s infrastructure this year — about 100,000 tonnes of cement, the company said.
Production capacity last year reached 3.66 million tonnes annually, it said, adding that Taiwan accounted for 41.67 percent and China for 58.33 percent.
The company on April 9 announced that it lost NT$8.33 million in February, with revenue totaling NT$86.69 million, mainly due to seasonal weakness.
The Taiwan Stock Exchange has requested that Hsing Ta disclose its latest financial figures due to volatility of its stock price.
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