TCI switching to GRETAI from Emerging Securities

INTERNATIONAL PLANS::The firm’s facial masks are now being sold by the Sephora chain, and it plans to open two factories in Shanghai over the next year

By Camaron Kao  /  Staff reporter, with CNA

Fri, Aug 23, 2013 - Page 14

TCI Co Ltd (大江生醫), which manufactures healthy food, functional beverages and skin care products, yesterday said it would shift its listing from the Emerging Securities Market to the GRETAI Securities Market on Sept. 12. This will make TCI the fourth biomedical company to list on the GRETAI this year.

The company is set to raise NT$401.13 million (US$13.40 million) by issuing 4.46 million common shares priced under NT$90.

TCI’s shares rose 3.35 percent to NT$133.39 on the Emerging Securities Market yesterday.

The company’s facial masks will now be sold by Sephora, the international cosmetics retail chain owned by LVMH Moet Hennessy Louis Vuitton SA (MC), general manager Vincent Lin (林詠翔) said.

“We have already shipped millions of facial masks to Sephora,” Lin said.

Facial mask sales accounted for 10 percent of the company’s revenue of NT$1.15 billion last year, while sales of functional drinks made up 60 percent, the company said.

TCI is planning to use the proceeds from its GRETAI debut to improve its financial status, develop new markets and finance capital expenditures, TCI chairman William Yang (楊武男) said on the sidelines of the company’s investors’ conference.

Deputy general manager William Liao (廖偉傑) said a new factory in Shanghai will become operational this quarter, producing facial masks and “essence” liquid, while another factory in Shanghai that will open in the second quarter next year will manufacture functional drinks.

The company will also open a logistics center in Pingtung County in the first quarter of next year, he added.

The company reported profit of NT$82.64 million, or NT$2.14 per share for the first half of the year, up 35.75 percent from NT$60.88 million, or NT$1.53 per share for the same period last year, the company’s filing to the Taiwan Stock Exchange showed.

In comparision, another functional drink producer, Grape King Inc (葡萄王), posted a profit of NT$506.4 million, or NT$2.87 per share over the same period, up 29.2 percent from NT$391.93 million, or NT$2.21 per share, last year.

TCI’s revenue for the first half of the year was NT$713.84 million, up 26.36 percent from NT$564.92 million a year ago, with China accounting for 59 percent of sales and Taiwan contributing 18 percent, the stock exchange filing showed. Hong Kong, Malaysia, Singapore and South Korea made up the remaining 23 percent.

Liao said sales will grow in the second half of this year on the back of rising sales in China and Southeast Asia.

However, gross margin during the first six months of this year dropped to 33.98 percent from 36.03 percent the previous year, the stock exchange filing showed.

“Our product prices in China are lower than in other places, and as revenue share in China increase, gross margin declines,” Liao said.

Hua Nan Securities Investment Management Co (華南投顧) forecast the company's earnings per share to reach NT$4.13 this year and revenue could hit NT$1.46 billion.