Formosa Plastics Group (台塑集團), Taiwan’s largest industrial conglomerate, yesterday said that three major subsidiaries incurred losses last quarter while the fourth eked out a tiny profit, as soft market demand and price competition weighed on their earnings.
Nan Ya Plastics Corp (南亞塑膠), whose main business involves making processed plastic and chemical products, electronic materials and polyester fiber, recorded NT$60 million (US$1.86 million) of net profit during the July-to-September period, or earnings of NT$0.01 per share, the company said.
The lackluster results suggested a slowdown from three months earlier, while declining international oil prices weighed on plastic and chemical products.
Photo: Fang Pin-chao, Taipei Times
Their profit margin was also harmed by unfavorable currency exchange rates and the need to recognize losses in the affiliated Formosa Petrochemical Corp (台塑石化), it said.
However, selling prices picked up for materials used in polyester and printed circuit boards ahead of the high sales season for technology products, it added.
Formosa Petrochemical Corp (台塑石化), primarily engaged in the business of refining crude oil, selling refined petroleum products and producing and selling olefins from its naphtha cracking operations, booked losses of NT$3.08 billion, or NT$0.32 per share, worsening from three months earlier, it said.
The privately owned refinery attributed the poor showing to tepid demand and oil export nations’ announcement that they would cut output from December amid a supply glut.
The drop in oil prices grew more evident last quarter and deepened losses of inventory and purchased materials, the company said.
Inventory losses alone amounted to NT$2.42 billion, surging from NT$170 million in the April-to-June period, it said.
Formosa Plastics Corp (台灣塑膠), a vertically integrated supplier of plastic resins and petrochemicals, reported losses of NT$3 billion, or NT$0.49 per share, as it idled seven plants to conduct annual maintenance, up from four in the preceding quarter, the company said.
The bleak figures stemmed from unprofitable core businesses and unfavorable influences of Typhoon Gaemi in July that disrupted the operation of plants in Kaohsiung and weakened their output, it said.
At the same time, raw material prices remained high, putting pressure on the profit margin, it said.
The company also recognized losses from indirect investments in affiliated businesses in Taiwan and in the US.
Formosa Chemicals and Fibre Corp (台灣化學纖維), which produces and sells petrochemical products, nylon fibers and rayon staple fibers in Taiwan and internationally, posted losses of NT$1.93 billion, or NT$0.33 per share.
Listless market demand and selling prices were to blame, the company said, adding that it is reducing capacity to speed up inventory adjustments.
The company is closely monitoring China’s latest stimulus measures and would move to take advantage of any business opportunity, it said.
HANDOVER POLICY: Approving the probe means that the new US administration of Donald Trump is likely to have the option to impose trade restrictions on China US President Joe Biden’s administration is set to initiate a trade investigation into Chinese semiconductors in the coming days as part of a push to reduce reliance on a technology that US officials believe poses national security risks. The probe could result in tariffs or other measures to restrict imports on older-model semiconductors and the products containing them, including medical devices, vehicles, smartphones and weaponry, people familiar with the matter said. The investigation examining so-called foundational chips could take months to conclude, meaning that any reaction to the findings would be left to the discretion of US president-elect Donald Trump’s incoming team. Biden
INVESTMENT: Jun Seki, chief strategy officer for Hon Hai’s EV arm, and his team are currently in talks in France with Renault, Nissan’s 36 percent shareholder Hon Hai Precision Industry Co (鴻海精密), the iPhone maker known as Foxconn Technology Group (富士康科技集團) internationally, is in talks with Nissan Motor Co’s biggest shareholder Renault SA about its willingness to sell its shares in the Japanese automaker, the Central News Agency (CNA) said, citing people it did not identify. Nissan and fellow Japanese automaker, Honda Motor Co, are exploring a merger that would create a rival to Toyota Motor Corp in Japan and better position the combined company to face competitive challenges around the world, people familiar with the matter said on Wednesday. However, one potential spanner in the works is
SEMICONDUCTORS: Samsung and Texas Instruments would receive US$4.75 billion and US$1.6 billion respectively to build one chip factory in Utah and two in Texas Samsung Electronics Co and Texas Instruments Inc completed final agreements to get billions of US dollars of government support for new semiconductor plants in the US, cementing a major piece of US President Joe Biden administration’s CHIPS and Science Act initiative. Under binding agreements unveiled Friday, Samsung would get as much as US$4.75 billion in funding, while Texas Instruments stands to receive US$1.6 billion — money that would help them build facilities in Texas and Utah. The final deals mean the chipmakers can begin collecting the funding when their projects hit certain benchmarks. Though the terms of Texas Instruments’ final agreement is
Call it an antidote to fast fashion: Japanese jeans hand-dyed with natural indigo and weaved on a clackety vintage loom, then sold at a premium to global denim connoisseurs. Unlike their mass-produced cousins, the tough garments crafted at the small Momotaro Jeans factory in southwest Japan are designed to be worn for decades, and come with a lifetime repair warranty. On site, Yoshiharu Okamoto gently dips cotton strings into a tub of deep blue liquid, which stains his hands and nails as he repeats the process. The cotton is imported from Zimbabwe, but the natural indigo they use is harvested in Japan —
RSS