Hiroca Holdings Ltd (廣華控股), a China-focused car component supplier, yesterday said it is pouring resources into the research and development (R&D) of eco-friendly products that can reduce volatile organic compounds, in a bid to expand its customer base.
The Taiwanese company, which based in Dongguan, China, and manufactures coatings and injection-molded parts for auto interiors, said it aims to replace traditional coatings with non-toxic paint films, is eyeing growing demand for green auto parts.
“We hope to surpass our global competitors by introducing these eco-friendly films,” chairman Yu Tse-min (余澤民) told reporters after an annual shareholders’ meeting in Taipei.
Hiroca is likely to start trial production of the films next year after obtaining certification from brand clients, Yu said.
The company usually spends nearly 3 percent of its yearly revenue on research and development, Hiroca chief financial officer Huang Sheng-chang (黃盛昌) said.
Commenting on the company’s business outlook, Huang said the firm’s gross margin should remain at a high level of about 26 percent this year, on the back of product mix optimization.
“Hiroca has secured orders from some Chinese electric car makers... These electric models are usually equipped with more expensive auto interiors [than fossil-fuel-powered vehicles],” Huang said.
The company reported net income of NT$189.61 million (US$6.31 million) in the first quarter this year, up 2.59 percent from NT$184.82 million a year earlier, despite rising labor costs in China.
SOARING REVENUE
Revenue rose 9.99 percent year-on-year to NT$1.99 billion from NT$1.81 billion thanks to Japanese brand clients’ model launches, with a gross margin of 25.25 percent.
Hiroca shareholders yesterday approved the distribution of a cash dividend of NT$5 per share on last year’s profit of NT$776 million, or earnings per share of NT$9.25.
That represented a 4.9 percent yield compared with the stock’s closing price of NT$102 on the Taiwan Stock Exchange.
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