Woven fabric maker De Licacy Industrial Co (得力實業) yesterday that said revenue for this year should grow by a double-digit percentage, backed by a 20 percent rise in orders from its top three clients and increased output from its Vietnamese factories.
“Orders from our top three customers should help us achieve double-digit growth in sales to a record NT$10 billion [US$317 million] this year,” De Licacy president Kuo Chun-hsiung (郭俊雄) told an investors’ conference in Taipei.
The capacity expansion at the Vietnamese factories would see monthly output for this quarter surge 185 percent year-on-year to 5.7 million yards (5.2 million meters) from 2 million yards per month a year earlier, he said.
Utilization rate at its Vietnamese plants, which are working on more complex dyeing and finishing technologies, is forecast to reach 100 percent in the second half of this year, from 60 percent last quarter, he added.
Cumulative revenue for the first four months of the year rose 11.57 percent to NT$3.08 billion, compared with NT$2.76 billion a year earlier, mainly due to increased output from the Vietnamese factories, the company said.
“Our biggest challenge is to meet orders for next year’s spring and summer, as Taiwanese and Chinese factories are running at full capacity,” Kuo said.
De Licacy has production bases in Tainan and Hangzhou, China.
The impact of the US-China trade dispute is limited, as 70 percent of its Chinese revenue comes from domestic clinets, with the US market accounting for a smaller ratio, the company said.
De Licacy counts Under Armour Inc as its largest client, contributing more than 20 percent to total sales.
Adidas AG contributed between 10 and 12 percent, and Uniqlo owner Fast Retailing Co between 8 and 10 percent, the company said.
First-quarter net income improved to NT$102.11 million, from net losses of NT$29.07 million in the same period last year.
Earnings per share climbed to NT$0.31, from losses per share of NT$0.09 a year earlier, company data showed.
Gross margin increased 2.92 percentage points to 18.04 percent, mainly thanks to improving utilization rates at its Vietnamese factories, foreign-exchange gains and a better product portfolio, the company said.
However, the expansion of Vietnamese factories led to a 3.1 percent increase in operating expenses to NT$319 million, it said.
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