Pneumatic components maker Airtac International Group (亞德客) yesterday said it aims to raise revenue contribution from outside China to 30 percent of total sales by 2020, from 12 percent last year.
“The demand for pneumatic components outside China accounts for more than 85 percent of global demand. We have strived to expand our market share globally since we became a major player in China in 2012,” chief financial officer Ivan Tsao (曹永祥) said.
Airtac has sales divisions in Italy, Singapore and Japan, and it plans to set up new divisions in France, Spain, Indonesia, Thailand and Vietnam in the next two to three years, Tsao said.
Last year, Airtac reported a revenue of NT$7.3 billion (US$243.14 million), with 88 percent coming from China, he said.
Airtac is the seventh-largest pneumatic component maker around the world with a market share of 2 percent. The company's products are used in machine tools for architecture, automobile and electronics industries, and it aims to double the number of its products to 160,000 items in 2020 from the current 80,000 items, Tsao said.
Japan-based SMC Corp, the world’s largest pneumatic component maker and the biggest in China, has about 240,000 products, he said.
Last year, AirTac was the second-largest pneumatic component maker in China, with a 14 percent share, while SMC had a 31 percent share.
Airtac is confident it can enjoy the same market share as SMC in China by the end of 2020, Tsao said.
The company has set a target of posting 15 to 20 percent revenue growth in China this year by gradually increasing its sales divisions there, he said.
The company had 62 sales divisions in China last year and plans to increase the number to more than 80 in three to five years, Tsao said.
In the first quarter, the company posted revenue of NT$1.83 billion, up 26.21 percent year-on-year. Net profit increased 45.34 percent to NT$381.5 million, or NT$2.24 per share, with gross margin improving by 2.7 percentage points to 56.3 percent.
Tsao said AirTac would maintain its gross margin at between 55 percent and 56 percent this year, similar to 55.3 percent it registered a year ago, while its operating margin will be at 30 percent this year.
The company plans to spend NT$2 billion this year and NT$1 billion next year to build a production base in Greater Tainan, on top of the NT$1.1 billion it spent last year, Tsao said.
The new base will commence operations at the beginning of next year and is expected to generate annual sales of NT$800 million to NT$1 billion and break even next year.
It will be used to manufacture high-end pneumatic components, and its location in Taiwan would help it better protect the company’s know-how compared with its other factories in China, Tsao said.
In China, the company plans to spend NT$1.5 billion this year and NT$1 billion to NT$1.5 billion next year for capacity expansion, after spending NT$1.5 billion last year.
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