Plastics manufacturer Taita Chemical Co Ltd (TTC, 台達化) suspended its loss-making Tianjin unit in China last month as the lingering US-China trade dispute eroded demand for home appliances there, the company said yesterday.
“We temporarily halted operations at our Tianjin factory, as it had been posting net losses in the past few years,” Taita Chemical vice president Yen Tai-ming (顏太明) told an investors’ conference in Taipei.
The suspension is expected to limit the Tianjin unit’s losses to NT$9.11 million (US$289,666) per quarter, Taita accounting manager Lin Chin-tsai (林金才) said.
The unit posted annual net losses averaging NT$91.1 million in recent years, Lin said.
Established in 2005, the unit contributed NT$286 million, or 6 percent, to the company’s first-quarter sales. Last year, the factory had an annual output of 30,000 tonnes of expanded polystyrene, company data showed.
“We would see how the market reacts in the following quarters and if we need to resume operations at the factory later,” Taita Chemical president Wu Pei-chi (吳培基) said.
Expanded polystyrene contributed 49 percent to the company’s sales last quarter, while acrylonitrile butadiene styrene (ABS), which is used in making home appliances and auto parts, accounted for 30 percent. General polystyrene (GPS), used for making electronics and appliance casings, contributed 18 percent, while glass wool and cubic printing made up the remaining 3 percent. Cumulative revenue in the first four months of the year declined by 8.55 percent to NT$6.19 billion, compared with NT$6.77 billion a year earlier, the company said.
The US-China trade dispute is expected to negatively affect the home appliance business in China after Washington raised tariffs from 10 to 25 percent on Chinese goods earlier this month, which would have repercussions for Taita Chemical, it said.
However, the company said it remains positive about the Chinese market in the long run, given rising demand for styrene monomer (SM) and general polystyrene, as well as plans to increase its ABS output by 200,000 tonnes this year and 600,000 tonnes in the next two years, it said.
The company last year produced 4.06 million tonnes of ABS and 9.25 million tonnes of SM, the data showed.
Taita Chemical’s net income climbed 2.94 percent to NT$195.22 million in the first quarter, up from NT$189.65 million a year earlier, while earnings per share slightly increased from NT$0.58 to NT$0.60 and gross margin rose 0.8 percentage points to 8.55 percent.
The company attributed the increase to better-than-expected sales of ABS and GPS.
Taita Chemical shares yesterday closed up 0.45 percent at NT$11.25 in Taipei.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by