Formosa Chemicals & Fibre (1326) Q3 2024 earnings summary

Executive summary

• Revenue for the nine months ended September 30, 2024 was NT$267.3 billion, up 9% year-over-year, but net income fell sharply to NT$2.2 billion from NT$7.7 billion in the prior year period, reflecting margin compression and higher costs.

• The third quarter saw a net loss of NT$1.3 billion, compared to a profit of NT$7.2 billion in Q3 2023, driven by lower operating margins and significant fair value losses on financial assets.

• Comprehensive loss for the nine months was NT$33.7 billion, mainly due to large unrealized losses on financial assets measured at fair value through other comprehensive income.

Financial highlights

• Operating revenue for Q3 2024 was NT$86.9 billion, flat year-over-year.

• Gross margin for the nine months was 4%, down from 3% in the prior year.

• Operating profit for the nine months was NT$11.1 billion, up from NT$7.6 billion year-over-year.

• Net income attributable to owners for the nine months was NT$1.4 billion, down from NT$8.4 billion in 2023.

• Basic EPS for the nine months was NT$0.25, compared to NT$1.44 in the prior year.

• Significant other comprehensive loss of NT$38.9 billion for the nine months, mainly from fair value changes in equity investments.

Outlook and guidance

• Management expects continued volatility in raw material prices and demand, with ongoing margin pressure in core petrochemical and fiber segments.

• The company is focusing on cost control, operational efficiency, and selective capital investments to navigate market headwinds.