Zeng Hsing Aims for Shipment of 3 Million Household Sewing Machines in 2013

Taipei, June 29, 2012 (CENS)--The Taiwan-based Zeng Hsing Industrial Co., now the world's leading manufacturer of household sewing machines, plans to build a new factory in Vietnam in the third quarter this year, which is slated for official run by the end of the third quarter of 2013 to expand the firm's combined annual production capacity in Taiwan, China and Vietnam by 10% to 3 million units next year.

Z.C Lin, chairman of Zeng Hsing, pointed out after the firm's shareholders meeting held recently that due to lower production cost in Vietnam than in China, the company is going to set up a new plant in Vietnam, in two stages. The first stage of construction, estimated to cost US$ 14 million will be kicked off in the third quarter this year and will be completed for official run a year later with an annual production capacity of two million units. The second stage will start in the third quarter of 2013 and will be completed by the end of 2014 for operation with annual production capacity of one million units.

However, Lin emphasized, after the completion of the new plant, the company will gradually switch the annual production capacity of 1.5 million units at its old plant in Vietnam to the new one. The company will also shift some production orders from its plant in Zhangjiagang, Jiangsu Province of China, to the new plant in Vietnam due to the lower manufacturing cost there. The annual production capacity of Zhangjiagang has decreased from 1.5 million in 2011 to 1.1 million this year.

In 2011, Zeng Hsing scored revenues of NT$ 4.477 billion (US$ 149.2 million) and net profits of NT$ 607 million (US$ 20.23 million) or NT$ 12.64 (US$ 0.42) in earnings per share (EPS). The company has decided to mete out cash dividends of NT$ 8 (US$ 0.27) per share to its shareholders.

Zeng Hsing has been designated as an original equipment manufacturer (OEM) of Singer Sewing Company, the biggest brand of household sewing machines worldwide. Zeng Hsing sets its shipment goal at 2.7 million units this year, with over 60% orders from Singer. Today some 30% of the annual global sales of 9-9.5 million household sewing machines are produced by Zeng Hsing.

Institutional investors pointed out that aided by the influx of massive orders from Singer, Zeng Hsing saw its shipments increase by 200,000 units year on year to 1.28 million units in the first half of the year. The company now still has orders for 300,000 units in hand for delivery in July. As a result, revenues and profits of the company will maintain stable growth this year.