Beverage supplier Hey Song Corp (黑松) is planning to tap into the carbonated drink market in Southeast Asia with its high value-added products over the coming years, in line with the government’s New Southbound Policy, a company executive said yesterday.
“We are upbeat that some of our key products are very likely to grab market share [in the region’s soft drink market],” Hey Song chairman Chang Pin-tang (張斌堂) told an investors’ conference in Taipei, referring to the company’s carbonated drinks containing vitamin C.
As part of its three-year renovation project, the company has allocated more than NT$2.2 billion (US$73.32 million) to build a new aseptic processing line, which would allow it to take advantage of growing health consciousness by adding nutrients to soft drinks.
Hey Song must provide this type of differentiated product to compete with well-known global brands in Southeast Asian markets, Chang said, adding that the company is targeting the Philippines, Thailand and Singapore.
The 92-year-old beverage maker did not disclose its investment budget or timetable for the ongoing Southeast Asia project, but said it is in talks with some Taiwanese firms that have had roots in the region for a long time.
Hey Song, which has a solid 7 percent share of Taiwan’s drink market, posted a net profit of NT$453.04 million, or earnings per share of NT$1.13, for the first three quarters of this year, which represented a decline of 54.68 percent year-on-year from NT$999.54 million.
The profitability of its core business did not decline significantly, the company said, attributing the sharp dip to a relatively higher comparison base in the same period last year, when it booked a one-off gain from the sale of its Chinese subsidiary.
The company sold its Suzhou-based unit, which contributed a non-operating gain of nearly NT$500 million in the second quarter of last year, company vice president Pai Chin-wen (白錦文) told investors.
Sales in the first three quarters of this year amounted to NT$7.05 billion, a 6.3 percent increase from NT$6.63 billion from the previous year, while operating income grew 9.06 percent to NT$156.16 million from NT$143.19 million.
Soft drinks made up 56 percent of the company’s total revenue, while alcohol contributed the remaining 44 percent.
Hey Song has distribution contracts with Kinmen Kaoliang Liquor Inc (金門高粱), Japan’s Choya Umeshu Co and French cognac maker Remy Martin, company data showed.
The company’s stock price yesterday remained unchanged at NT$31.1 in Taipei trading.
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