Feng Tay's Capital Expenditure for 2014 to Reach NT$1.5 Bn.

With a plant construction in Vietnam and capacity expansion in India both underway, Feng Tay Enterprises Co., Ltd., a Taiwanese contract manufacturer of athletic shoes and footwear, will see its 2014 capital expenditure likely reach NT$1.5 billion (US$50 million), with about NT$800 million (US$28.8 million) already realized in the first half (H1) of the year, according to the firm.

With capacity utilization rate having remained around 90% for some time, Feng Tay indicated that it has stepped up the above-mentioned projects to boost  capacity to keep up with customer demand.

Designed to greatly enhance Feng Tay's overall output in India, the capacity expansion includes new production lines to be set up at both its Factory 2 for Nike shoes and another factory for Converse products, as well as a new building at its plant for Salomon footwear.

The other project focuses on the construction of a brand new factory equipped with five production lines in Vietnam, which will become operational in H2, 2015 to turn out non-Nike leisure shoes, with three new production lines having been just set up there, two of which having been rolling out cycling shoes and outdoor leisure shoes since Q2, and the other to begin filling orders from one customer in September.

With the newly added capacity, Feng Tay is optimistic about Q3 outlook, projecting footwear production and sale volume at 20.1 million pairs and 18.81 million pairs, respectively, up 14% and 11% year-on-year (YoY). Institutional investors generally believe the company's promising sales to continue throughout 2014, given Q4 is the industry's high season.

For the first seven months of this year, the firm raked in cumulative net profits of NT$1.531 billion (US$31.03 million), up 19.6% YoY, with EPS (earnings per share) of NT$2.64, higher than NT$2.3 during the same period of last year. (SC)