Cheng Shin Tires Q1 Gross Profit Margin up to 32%

Taiwan Media reported that in the first quarter of this year, the operating revenue of Cheng Shin Tire (CST) totaled 2.93 billion NT dollars (about 5.86 billion yuan), up 6.7% quarter on quarter, the net income after tax was 4.02 billion NT dollars, the gross profit margin was up 0.68 percentage points to 32%, and the earnings per share was 1.24 NT dollars.

CST is the world's ninth biggest tire manufacturer, the Chinese mainland, Asia-Pacific, America, Taiwan, Europe, and Middle Asia and Africa contributed 57%, 14%, 12%, 6%, 5%, and 6% of its total operating revenue.

With regard to the products, passenger car radial tires account contributed 44% of the total revenue, truck and bus radial tires accounted for 16%, and motorcycle radial tires at 14%.

CST believed the growth in revenue was driven by warming up of China's tire industry as well as natural rubber price hike, which stimulated tire producers' shipments.

CST has 10 tire production bases locate in the Chinese mainland, Taiwan, Thailand and Vietnam.

Favoring long-term development potential, CST has set up to new plants in Indonesia and India and schedules to launch massive product from the first quarter of next year.

The priority of the two new plants will be OE market and supplying Japanese branded vehicles.

CST said the a number of its tire plants in the Chinese mainland, Thailand and Vietnam were almost under full load.

In addition, some Japanese car producers had cooperated with CST's plants in the Chinese mainland, Taiwan and Thailand to develop tire models for their new cars. German car producers had also been testing new cars in Kunshan, Jiangsu province, and the orders for OE tires are expected to grow.