Rexon Industrial Corp Ltd (力山), which manufactures and distributes benchtop power tools and fitness equipment, on Thursday gave an optimistic outlook for the final quarter of this year on the back of growing demand for gym equipment.
The company’s order visibility was brighter this quarter, Rexon vice president Lin I-lung (林益隆) said at an investors’ conference in Taipei, adding that the company has secured large orders from four international brands this year, including the US-based Precor Inc.
The company is also an original equipment manufacturer for exercise bike maker Peloton Interactive Inc, which is one of the US fastest-growing start-ups to have a focus on at-home spinning, Lin said.
The Taichung-based Rexon, which entered the fitness equipment market in 1998, has been doing research and development on fitness equipment to improve its profitability and reduce reliance on a single product.
The gross margin of fitness equipment can surpass 30 percent, much higher than traditional power tools, the company said.
The company plans to launch 10 models of new fitness equipment every year, eyeing the long-term growth momentum in the sector, it said.
Commercial and at-home workout equipment have become major revenue contributors for the company, making up 27 percent of its total sales in the first half of this year, company data showed.
To satisfy better-than-expected customer demand in the industry’s peak season, the company said it is planning to hire 200 more workers by the end of this year, in addition to its 1,500 employees currently in Taiwan and China.
The company posted revenue of NT$667.76 million (US$22.08 million) for last month, an 81.36 percent jump from NT$368.2 million the previous year, mainly driven by an increasing number of fitness equipment orders.
That brought accumulated revenue in the first nine months of this year to NT$3.58 billion, a 29.81 percent increase from NT$2.76 billion the previous year.
In the first half of this year, the company said net profit grew 74.9 percent to NT$37.79 million from NT$21.6 million, with earnings per share rising to NT$0.21 from NT$0.12.
Rexon shares rose 10 percent to close at NT$62.7 in Taipei trading yesterday, easily beating the broader market, which fell 0.29 percent.
The company’s stock price has grown threefold since January, Taiwan Stock Exchange data showed.
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