FENC aiming to double revenue from polyester business

23 Jun '10

5 min read

Far Eastern New Century Corporation held its 2010 Annual General Shareholders' Meeting at the Auditorium of Taipei Hero House. Chairman Douglas Tong Hsu presided the meeting; the management team reported the 2009 operating results, and presented the prospects and strategies of the Company, with respect to its main business areas – petrochemical, polyester, property development, and equity investments.

“Despite of the fact that the global economy had gone through an unprecedented recession in year 2009,” according to Chairman Hsu, “FENC managed to deliver a financial result showing tremendous growth compared to 2008.” The revenue of FENC, based on the presentation by the management, achieved NT$41.9 billion and NT$167 billion on the parent-alone and consolidated basis, respectively. The net income rose to NT$8.1 billion, increasing by a dramatic amount of NT$3.5 billion, or 76%, compared to 2008, translating into an earnings per share of NT$1.74.

The performance of 1Q10 was even more impressive. The revenue of the Company on parent-alone basis rose to NT$12 billion, and the operating results, with the relentless efforts of the management team, turned from negative to positive, resulting in a net income of NT$2 billion. The earnings per share in 1Q10 alone was NT$0.43. Both the revenue and the net income posted a growth rate of 32% year on year.

“An upside potential of significance will likely occur at the operating level of the Company”, according to President Johnny Shih. Year 2009 was the sixtieth anniversary of the Company after being relocated to Taiwan. When commemorating its anniversary, FENC announced “an aggressive operating target, aiming to double its revenue from petrochemical and polyester businesses.” said by the President Shih, “And three specific strategies have been schemed for achieving this target; they are: 1) Expand capacity aggressively; 2) Create new applications for environmentally friendly materials; and 3) Capture market shares in China.”

Based on the further elaboration by President Shih, the production capacity of petrochemical, polyester, and apparel businesses in both China and Taiwan of the Company will be upgraded over next five years. In particular, a new PTA (Pure Terephthalic Acid) line and a new polyester plant, both using the most advanced technology and with the largest capacity for a single production line in the world, are being planned, ahead of peers of the Company, in order to ride on the recovery of the global economy.

Moreover, the R&D Institute of the Company will focus on the innovation of applications for green materials, including recycled, bio-based, and bio-degradable, facilitating the Company as the leader of conserving the environment in the polyester industry. Most importantly, given the remarkable growth potential, the Company will intensify its sales efforts in China domestic market, to promote high value-added products, such as fibers or fabrics for industrial purposes, PET packaging materials, and high-end sports wears, in hopes of boosting its overall market share in China.

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