Nylon makers saw grow in sales volume due to future price rise

Li Peng Enterprise Co and Zig Sheng Industrial Co – Nylon makers, saw an increase in their revenue growth as downstream companies increased their procurement amid expectations of future price increases. The revenue growth posted 3.6 percent and 6.31 percent respectively for last quarter.

Last quarter, Li Peng, the nation’s largest nylon maker, posted revenue of NT$6.73 billion (US$22.38 million), up from NT$6.5 billion the previous quarter, according to a company filing to the Taiwan Stock Exchange.

The figure last quarter was 8.9 percent higher than the NT$6.18 billion posted the previous year, the filing said.

Their factories will operate at full capacity this month because of rising orders, said Chang Ta-chuan assistant vice president of Lealea Group, a subsidiary of Li Peng.

Chang said that the company’s sales this quarter would be slightly affected by the Lunar New Year holiday, but that he is still optimistic.

Nylon production around the world is expected to rise less rapidly this year, he said, adding that the company would have higher margins because of the quality of its products and its bargaining power to buy materials as prices get cheaper.

The company is set on to break ground on its new nylon production line, in which it invested NT$2 billion. The production line is expected to increase its capacity by 180,000 tonnes a year starting in the first quarter of new year.

However, Chang was less optimistic about the prospects for Lealea Enterprise Co, another company under the group which makes polyester yarns. Their sales volume will rise this year, but margins on polyester products are expected to be lower because of oversupply in China.

Lealea Enterprise posted revenue of NT$2.96 billion last quarter, down 3.58 percent from NT$3.07 billion the previous quarter and up 6.86 percent from NT$2.77 billion the previous year, according to the filing.