TPE:9904

CTBC Securities Starts Pou Chen at Add with NT$30 Price Target

Pou Chen Unit Warns of Up to 55% Plunge in Q1 Profit

Pou Chen's (TPE:9904) major unit Yue Yuen Industrial expects profit attributable to shareholders to plunge about 50% to 55% annually in the first quarter from $75.8 million, according to a Tuesday Taiwan Exchange filing.Shares slid about 1% in Wednesday's late morning trade.The decline was mainly driven by a 5.5% fall in manufacturing revenue amid weaker demand and cautious ordering by brand customers, alongside tariff-related pressures.Rising labor costs and increased headcount, as well as production inefficiencies caused by holiday-related disruptions across China, Vietnam and Indonesia, also weighed on margins.The company said seasonal misalignments and operational bottlenecks led to higher unit costs, hurting short-term profitability in its manufacturing business.Yue Yuen added that results are preliminary and subject to change, with full unaudited earnings due for release on May 13.