Tue, Sep 03, 2019 - Page 12 News List

Ocean Plastics to offset declining PVC shipments with eco-friendly products

By Kwan Shin-han  /  Staff reporter

Ocean Plastics Co’s (大洋) shipments of polyvinyl chloride (PVC) raw materials would continue to decline in the second half of the year after fierce competition in the market affected sales of such products in the first half, chief financial officer Wang Yi-ho (王逸鶴) told an investors’ meeting in Taipei yesterday.

As competition is likely to increase due to more players entering the PVC raw materials business, the company plans to introduce new products, such as eco-friendly non-PVC plastic pellets, to gain new orders in the second half, Wang said.

That would help maintain the company’s sales in the second half at a similar level to the NT$2.23 billion (US$71 million) recorded in the first half, he added.

As demand for more eco-friendly products is growing in European markets, the firm is optimistic about the business outlook for its dimethylformamide-free polyurethane materials, which contributed 4 percent of total sales in the first half, Wang said.

Ocean Plastics also supplies PVC construction materials and sheets, and has real-estate investments.

PVC construction materials and sheets, which accounted for 25 percent and 10 percent of total sales respectively in the first half, are expected to post slower growth in the second half, as major clients remain conservative about market demand amid the lingering US-China trade dispute, Wang said.

Asked by investors about the company’s real-estate business, Ocean Plastics chairman Chen Chin-ming (陳欽明) said a project in New Taipei City’s Zhonghe District (中和) developed with Kingdom Construction Corp (冠德建設) is still being reviewed by the city government.

The company plans to start marketing the residential-commercial complex, including 1,200 homes, in three to four years, Chen said, without elaborating.

Ocean Plastics also holds assets elsewhere in Taiwan, such as a 3,700 ping (9,917m2) plot in Kaohsiung and a 1,000 ping plot in Taipei’s Jingmei District (景美).

In China, the company owns a 25,000 ping plot in Hunan Province, Chen said.

Ocean Plastics is considering expanding its manufacturing site in Taoyuan’s Sinwu District (新屋), which covers 40,000 ping, Chen said.

The company reported net losses of NT$22.03 million last quarter, which were an improvement from losses of NT$73.52 million year earlier, but worse than its net profit of NT$30.99 million in the first quarter.

Overall, the company posted net profit of NT$8.96 million in the first half, compared with net losses of 33.78 million a year earlier, while earnings per share improved to NT$0.04, compared with losses per share of NT$0.15 a year earlier.

Gross margin increased 1.23 percentage points to 4.99 percent.

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