O-Ta Likely to See Peak September Season Advance a Month

With its biggest customer, Nike, likely to stock up aggressively in August to better cope with the U.S.'s simmering market for golf clubs, O-Ta Precision Industry Co., Ltd., a Taiwan-based contract manufacturer of golf clubs and heads, is likely to see the traditional September high season advance one month to turn around its sluggish performance, according to institutional investors.

As an iconic sports brand globally, Nike has been developing sales in golf clubs amid positive signs of stable economic recovery in the U.S., also to leverage the celebrity power of its endorser, Rory Mcllroy, who has just won the British Open to continue his march towards golf stardom. Market observers say that these factors are motivating Nike to step up  launching products.

Nike is reportedly finalizing new product projects with O-Ta, and is expected to place orders with the contract manufacturer starting in August, with O-Ta scheduled to begin delivery in September.

Nike, institutional investors say, and other major customers as Bridgestone, Mizuno, Titleist and Cobra have also been in talks with O-Ta for order placement.

Additional good news for O-Ta is that its newly constructed plant in Jiangxi Province, China, has begun delivering old-style golf clubs to two Japanese customers after passing certification. The plant, to be fully engaged in supplying stainless steel iron heads, is scheduled to further obtain certification from three American customers in the second half of the year.

The company saw lackluster performance in Q1 with net losses of NT$30 million (US$1 million), or NT$0.25 per share, with such abysmal sales to bottom out in Q3 with the upcoming orders. (SC)

O-Ta's Performance by Quarter
Period	Q2, 2013	Q3, 2013	Q4, 2013	Q1, 2014
Revenue	NT$895 M.	NT$851 M.	NT$1.648 Bn.	NT$1.079 Bn.
Net Profits	- NT$89 M.	- NT$42 M.	NT$64 M.	- NT$30 M.
Earnings per Share	- NT$0.74	- NT$0.35	NT$0.53	- NT$0.25

Source: Market Observation Post System