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Sumeeko's Revenue to Reach New Record for 3rd Consecutive Year with Stabilized Order Reception
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2015-01-16
Automotive fastener maker SUMEEKO Industries Co., Ltd set a new monthly record for December revenue of NTD 137 million, which translates to a 50% and 28%. The growth back on track is attributed to the alleviated congestion (driven by labor strike) at the ports of Los Angeles and Long Beach, as well as smooth order fulfillment and delivery. Overall, North American car market in 2015 is optimistic. With increasing clients in Europe and Asia, Sumeeko's business in 2015 is expected to outperform last year.
Prospecting this year, Sumeeko says currently order visibility extends to over 5 months, and that overall business condition is picking up momentum. Sumeeko analyzes that North American car market looks optimistic and will grow, judging from the fact that 60% of its (OEM) clients are from North America. Although recent European market is volatile on the whole, it is not pessimistic since Sumeeko's European orders are still growing in number and new clients and orders are still coming in.
In addition, Sumeeko is expanding deployment in Southeast Asia and China, and thinks it can maintain growth status for the year. Another growth momentum for Sumeeko is the new plant in Pintung (Southern Taiwan). Sumeeko says the plant is going through application procedure to be added into operation possibly in this year. The effect of capacity expansion will be more evident in Q3.
In Sumeeko's plan, the new plant will aim to reclaim outsourced production to lower production cost, and capacity will gradually increase starting in the second half year. The goal is to double the current Kaohsiung plant's capacity by 2016. By then, Sumeeko's total capacity will grow from the current 1,000-1,100 tons per month, to 2,000-2,200 tons per month.
Sumeeko's business momentum this year is expected to come from the growth in North American car market. Coupled with increase in GM's new orders, as well as new car model (Model X) delivery of electric car client TELSA, revenue this year is expected to grow another 20%. Full year revenue is expected to grow from last year's NTD 128 million to NTD 150 million. Full year EPS is expected to reach NTD 7 and set a new record for the third consecutive year.
Sumeeko produces fasteners and components, 70% of which are supplied to OEMs. Most of its clients are multi-national car brands, in which GM is the largest client, followed by TOYOTA, Chrysler, NISSAN, Honda, Suzuki, BMW, VolksWagen, etc. Tier 1 assembly plant BOSCH is its client, too. In terms of regional market performance, North America, Europe, and China respectively represent 60%, 30%, and 5% of revenue, with the remaining percentage represented by other regions.
