At an earning call yesterday (22), TCI Co., Ltd. focused on the development of China, Europe and the United States, and the growth of its operations this year. The spokesperson said that after combining the advantages of the Utah factory and on-site visits, many US customers that had not been penetrated before have been entered, and many product collaborations are underway, so the results will maintain strong growth. However, sales are now concentrated on large customers and changes from quarter to quarter will depend on the shipment status of each customer.
The gross margin dropped to 37.82%, down 2.5 percentage points from the same period last year, and earnings per share (EPS) were NT$1.39. In terms of individual financial results, China accounted for 42% of revenue in the first quarter, while Europe and the US continued to increase their share to 39%, Taiwan accounted for 8%, Asia increased slightly to 10% and the rest was around 1%.
The spokesman said that the worst time of the Chinese market is over, but TCI has yet to see a strong recovery. The economy is still weak at the moment. The Chinese market is also changing in terms of customer type, direct sales are stable, micro business revenue has dropped significantly compared to the previous volume, but the channel has gradually transformed towards e-commerce or live sales, optimistic about the future of China's e-commerce or KOL-driven growth.
In Europe and the US, TCI is working on many large cases and are at different stages of development, but the long-term growth trend is certain. In Asia, TCI can expect more growth in Southeast Asia. In the past, some projects could not get off the ground, but after the epidemic, through visits and with the added value of the US headquartered factories, customers who were previously unable to enter the market are now moving towards cooperation. In Europe, it is mainly brand owners, distributors and regional direct sales cooperation. Overall, Europe and the US maintained strong growth, with orders visible for at least three months.
As for the contribution from the Utah plant, Mr. Wong said that the introduction of high production speed beverage equipment and the 50ML small glass production line is expected to be completed by the end of the second quarter and the beginning of the third quarter, and production costs will be optimised in the future.
Overall, revenue this year will be better than last year, and gross margins are expected to rise in tandem. However, sales are now more concentrated in large customers, and each customer has different ordering habits, depending on subsequent shipments. Through business activities, services, new R&D investments and patented raw materials, TCI said they can help customers to grow their potential.
