Overview
In 2024, Nan Ya Plastics Corp. (NPC) recorded a consolidated revenue of NT$259.61 billion, marking a 0.1% decrease from NT$259.75 billion in 2023; and consolidated pre-tax income of NT$4.52 billion, declining by 50.5% compared to NT$9.13 billion in 2023.
In 2024, inflation and high interest rates have slightly eased, coupled with the continued growth in supply chain demand driven by the development of AI. Except for a slight decrease in printed circuit board sales, the Company experienced slight growth in both revenue and profitability from its core business in other product categories. However, adverse factors such as the U.S.-China tech war, geopolitical conflicts, and the real estate issues in Mainland China have hindered the recovery momentum. Additionally, the reduction in recognized investment income has further impacted overall profitability, resulting in unsatisfactory financial performance.
Since its establishment, Nan Ya Plastics Corp. has continuously undergone industrial transformation in response to the development of socio-economic conditions and technological advancements. The Company currently operates in key industries, including plastics processing, chemicals, polyester, and electronic materials.
In terms of plastic processing,
advancements in processing technology in recent years have led to the development of new applications, new materials, and eco-friendly products for the medical industry, such as wafer cutting and polishing tapes, automotive interior films, and blood bag and leukocyte reduction filter system. These products have been widely applied across various industries. Simultaneously, the production lines have integrated automated monitoring equipment to enhance machine production efficiency. The Company has also promoted e-commerce and online marketing strategies to expand into high-end and emerging markets with strong potential, achieving stable and sustainable business growth.
Moreover, we took advantage of our decentralized production sites at home and abroad in Taiwan, mainland China, the U.S., and Vietnam. By coordinating production and marketing operations among our plants promptly, we provided satisfactory service and experience to our customers. As a result of our ongoing efforts, we consistently maintain stable profitability in plastic processing products.
In terms of chemical products,
in line with vertical integration and division of labor in the Sixth Naphtha Cracking Plant in Mailiao, NPC's products, including ethylene glycol (EG), Bisphenol-A (BPA), 1,4-butylene glycol (1,4BG), plasticizers, phthalic anhydride (PA), 2-ethylhexanol (2EH), and epoxy resin (EPOXY), have been vertically integrated into upstream and downstream industries to form a complete supply chain that supports the development of downstream industries such as polyester, electronics, and plastic processing, respectively.
In 2024, new production capacity in Mainland China was gradually brought online, with output spilling over to overseas regions, leading to increased market competition. In response, the Company flexibly adjusted its production and sales regions, as well as the capacity utilization rates for different products, based on market conditions. Specifically, for ethylene glycol (EG), process optimization was implemented. Additionally, with the market recovering, the Company leveraged the relatively lower raw material costs at its Texas plant in the United States to increase production and sales volume, driving improvements in overall chemical product revenue and profitability.
In the field of polyester products,
adhering to an environmentally sustainable business philosophy, we are committed to recycling and regenerating polyester products used by consumers. We have independently developed AI-driven sorting technology, proactively advancing the recycling of fabrics, and launched our polyester recycling brand, "SAYA." Through the optimization of product structures, we are strategically positioning ourselves in the high-value-added product market. In 2024, our revenue saw a slight growth.
To facilitate recycling, we have launched single-material products, such as modified polyester pellets used to produce zippers, buttons, and other garment accessories, making the entire garment out of PET material. We also manufacture curtains made entirely of polyester material, which have received an excellent market response. Additionally, we have developed polyester pellets for medical applications, expanding the high-end PET application market. The modified recycled polyester pellets are also used in 3C electronic products, continuously expanding the application of fiber products and increasing the value of recycling and reuse, leading to further growth in our performance.
In the field of electronic materials,
demand for consumer electronics remained weak in 2024. However, the rise of AI applications drove an increase in the demand for copper foil substrates and copper foil. Additionally, the market for high-frequency and high-speed materials, including automotive, telecommunications, and server sectors, remained stable, resulting in a strengthening of our operations.
In the future, fields such as generative artificial intelligence (AI), high-performance computing, edge computing, servers, and high-speed switches will continue to grow. Additionally, artificial intelligence will transition from the cloud to the edge, advancing towards the application development of end products (such as AI PCs, AI smartphones, AI robots, etc.), further driving the demand for upstream raw materials.
Electronic materials will focus on the development of high-end materials with high-frequency, high-speed, low dielectric constant, and low coefficient of thermal expansion. NPC leverages its complete upstream and downstream vertical integration advantages, combining both internal and external resources to drive transformation. In addition to enhancing the value and differentiation of existing products, the Company is also advancing the development of materials for high-end telecommunications, AI servers, low earth orbit satellites, wind power, and maritime industries. With stable raw material sources, NPC is well-positioned to meet customers' one-stop purchasing needs, with promising growth prospects.
In the field of circuit boards, Nan Ya Printed Circuit Board Corp. (Nan Ya PCB) has long been deeply involved in the IC carrier board market and has collaborated with customers to launch next-generation high-end server and switch, telecommunications, AI, and high-performance computing chip application boards.
With the rapid development of generative AI, the demand for customized chips and high-speed transmission has increased. Nan Ya PCB has developed large-size, multi-layer IC carrier boards for cloud AI server processors, high-speed switches, and other applications. Nan Ya PCB will also begin mass production of IC carrier boards for high-end PC central processing units (CPUs) and graphics chips, positioning itself to capitalize on the emerging market opportunities for edge AI products.
The reinvested subsidiary, Nan Ya Technology Corp., is dedicated to developing, manufacturing, and selling DRAM products. It is currently advancing its proprietary technology for 10nm process nodes, with the development and mass production of related products (such as DDR5 and beyond) underway.
With the rapid development of AI, the demand for HBM (High Bandwidth Memory) DRAM products will continue to grow. We are actively developing high-density advanced products, including Through-Silicon Via (TSV) processes and multi-chip packaging, along with designs for high-bandwidth products. At the same time, we will strategically invest in and collaborate on the integration of logic-based ICs and HBM DRAM, as well as the development of customized memory solutions. Leveraging our deep process technology development capabilities, we aim to establish long-term competitive advantages.
Looking ahead to the year 2025, the intensifying technological competition between the U.S. and China, coupled with tariff barriers, supply chain restructuring, and geopolitical tensions, presents significant uncertainties for economic development. Additionally, the continuous expansion of petrochemical production capacity in Mainland China, increased competition within the industry, and the imposition of carbon taxes, among other factors, will continue to make operations challenging.
In response to changes in the political, economic, and technological landscape, the Company announced four major transformation strategies in June 2024: ① product transformation, ② business transformation, ③ low-carbon transformation, and digital transformation. Additionally, the Company established the "Sustainable Operations and Development Department" to coordinate resources across the organization and drive business transformation and sustainable development. The key directions for these initiatives include：
- Product Transformation: Increase the proportion of high-value and differentiated products, develop new application areas, and expand into new markets.
- Business Transformation: Develop new businesses, products, and technologies, seek business transformation, and deepen the Company’s industry layout.
- Low-Carbon Transformation: Expand green products, focus on energy-saving and carbon reduction, and implement the circular economy.
- Digital Transformation: Apply digital technologies, enhance AI applications, and achieve digital transformation to enable intelligent operations.
The four major transformations align with three key industry development trends: high-speed communication and AI innovative application materials, low-carbon and green products, and biotechnology and medical health application materials. The first three fall under industry transformation, while digital transformation focuses on establishing and optimizing a solid and efficient operational foundation for the Company. Overall, the strategy incorporates the concept of sustainable development, allowing for the creation of marketable products that can adapt to industry and technological changes.
In the short term, the Company is undergoing product transformation, focusing on producing differentiated and high-value products, while continuously leveraging the characteristics of existing products to explore new uses and markets. Additionally, in line with industry development trends, the Company is pursuing new business development, new product research and development, and the introduction of new technologies to seek business transformation, such as in medical materials and semiconductor materials.
In addition to product and business transformation, the Company is continuously integrating artificial intelligence into equipment and processes, consolidating various digital data, and developing a digital management platform. This initiative aims to optimize the control of production process conditions, enhance product quality, and reduce raw material and energy consumption. By implementing intelligent management and leveraging big data analysis and automation, the Company seeks to strengthen its competitiveness and improve operational efficiency.
The Company develops environmentally friendly, high-value green products and implements water and energy-saving processes. We are also engaged in cross-factory resource and energy integration for multiple cycles of recycling, reducing resource consumption. Through strategic alliances, we have established a recycling system to achieve waste reduction. By promoting green processes, we aim to lower carbon footprints and minimize environmental impact. Several products have already obtained ISCC Plus (International Sustainability & Carbon Certification) certification, demonstrating our commitment to sustainable operations.
We are also actively implementing strategies to achieve " Carbon Neutrality by 2050". These strategies include "low-carbon energy transition", "energy conservation and circular economy", "increasing renewable energy usage", "application of carbon capture technology", etc. We are also proactively addressing the opportunities and challenges presented by climate change.
In terms of new expansions and investments, several projects have been completed this year, including the release film and blood bag and leukocyte reduction filter system for medical use at the Shulin Plant in Taiwan, PET-modified pellets at the Linkou Plant, and flexible PVC sheeting at the Texas plant in the United States.
In the coming years, the Company will continue to carry out expansion projects, including the Phase II ABF substrate at the Shulin Plant in Taiwan, the solar system installation at the Xingang Plant, and copper foil plant in Huizhou, mainland China. In the future, in addition to production line upgrades, the Company will also respond to industry development trends, international trade dynamics, and supply chain changes by timely and strategically investing in new businesses and high-value products to drive continuous growth in performance.