Taisun International (Holding) Corp (泰昇國際), which makes baby diapers, sanitary pads and adult incontinence products, yesterday said that falling raw material costs, rebounding Vietnamese and Cambodian markets, and new product launches would help boost its sales in the second half of this year.
“The price of raw materials is on a declining trend and we depleted much of the inventory for high-priced raw materials in the second quarter,” a company official told the Taipei Times by telephone, quoting Taisun president Tai Chao-rong (戴朝榮).
Lower raw material prices would help the company’s gross margin return to normal levels in the second half, the official quoted Tai as saying at a shareholders’ meeting in Taipei on Friday last week.
Gross margin in the first quarter declined by 4.64 percentage points year-on-year to 27.35 percent.
The official, who declined to be named, said Taisun’s businesses in Vietnam and Cambodia have shown significant growth since last month as concerns about counterfeit goods in the region eased.
However, Taisun faces fierce competition from e-commerce operators in the region and is adopting various marketing strategies to promote its products to customers of different backgrounds, the company said.
The company earlier this year built a production line for baby diapers at its Vietnam unit and plans to add another line for adult incontinence pants this quarter, it said.
The company plans to start a new production line for sanitary napkins in Cambodia this quarter, it added.
Overall, sales contribution from Vietnam is expected to reach about 50 percent of the company’s total sales this year, compared with Cambodia contributing 30 percent, the company added.
Capital expenditure for this year is about US$4.5 million, just shy of last year’s figure, Taisun said.
Cumulative revenue in the first five months of the year climbed 11.75 percent to NT$759.56 million (US$24.5 million) from NT$679.73 million a year earlier.
Analysts said the company's sales are expected to grow by double-digit percentages this year, given its expanding business in Southeast Asia and the addition of new output.
Shareholders have approved the distribution of a cash dividend of NT$5.3, which implies a payout ratio of 69.65 percent based on last year’s earnings per share of NT$7.61 and a dividend yield of 4.38 percent based on the stock’s closing price of NT$121 yesterday.
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