Nan Ya Plastics (1303) Q2 2025 earnings summary

Executive summary

• Revenue and operating profit increased year-over-year in 1H25, driven by strong demand for high-end electronic materials, AI, communication, and automotive sectors, as well as improved EG plant utilization in Texas and Mailiao.

• Despite higher operating profit, pre-tax income and EPS declined year-over-year due to significant equity losses from affiliates and unfavorable foreign exchange impacts.

• For the six months ended June 30, 2025, the group reported a consolidated net loss, reversing a profit from the same period last year, with significant declines in both operating and non-operating results.

• Revenue decreased year-over-year, with all major business segments impacted, and comprehensive income turned negative due to large unrealized losses on investments and foreign exchange.

• The auditors issued a qualified review opinion due to unreviewed financials from certain subsidiaries and equity-accounted investees, which represent a material portion of assets and income.

Financial highlights

• Consolidated revenue for 1H25 was NT$131.3 billion, up from NT$125.0 billion in 1H24; 2Q25 revenue slightly increased sequentially from 1Q25.

• Operating profit for 1H25 rose to NT$1.34 billion from a loss of NT$0.29 billion in 1H24; 2Q25 operating profit was NT$1.30 billion, up from NT$0.04 billion in 1Q25.

• Net loss attributable to owners was $3.66 billion, compared to net income of $2.98 billion in the prior year.

• EPS for 1H25 was NT$0.06, down from NT$0.38 in 1H24; 2Q25 EPS was negative at NT$-0.52.

• Total comprehensive loss was $29.39 billion, compared to comprehensive income of $15.48 billion in the prior year, mainly due to large unrealized losses on investments and currency translation.

Outlook and guidance

• Q3 demand for electronic materials is expected to remain robust in AI and networking, but overall consumer demand may be muted due to inventory clearance.

• Chemical shipments are set to increase with full capacity operations in Texas and China.

• Management continues to evaluate the effects of climate-related risks and regulatory changes, including carbon fees and global tax reforms.

• The group is monitoring the impact of new and upcoming IFRS standards, including IFRS 18 and global minimum tax rules, but does not expect significant near-term financial impact.

• Polyester demand in Taiwan is recovering, but overall industry outlook remains conservative.