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Rechi to Achieve New High of NT$17 Bn. in 2014 Revenue

2014/10/22 | By Steve Chuang

The Taiwan-based Rechi Precision Co., the world's fourth-largest supplier of compressors for air conditioners by volume, is widely expected by institutional investors to achieve a new high of NT$17 billion (US$566.67 million) in consolidated revenue this year, with its compressor shipments likely to exceed 13 million units.

Rechi is having a good year. Its consolidated revenue for the first nine months totaled NT$14.383 billion (US$479.43 million), up 16.95% year-on-year (YoY), while compressor shipments reached 10.60 million units, a growth of 19.87%. This performance leads institutional investors to predict that the company's 2014 revenue will top the previous record of NT$16.7 billion (US$556.67 million), achieved in 2011.

Last year Rechi shipped 12.36 million compressors and earned consolidated revenue of NT$16.472 (US$549.06 million), yielding an EPS (earnings per share) of NT$2.02. The firm's major customers include such globally known air conditioner brands as Gree, Haier, Hisense, TCL, Midea, and Sharp, as well as Taiwan's Sampo, Tatung, and Heran.

For the next stage of its development, Rechi will add brushless DC motors to its product lineup, which currently consists of compressors, inverter compressors, and compressors for heat pump dryers. The firm confirmed that it plans to kick off mass production of the new products at factories in Taiwan and China in November at an annual rate of 3-5 million units.

To give its business an added boost, Rechi has joined with the China Steel Corp., Taiwan's largest steelmaker, and downstream motor distributors to invest a total of NT$3.2 billion in setting up a sound supply chain and effective distribution network. This is seen to be a worthwhile investment, since brushless DC motors can help cut the power consumption of air conditioners by over 20%.

Rechi emphasized that product diversification can help it avoid market fluctuations and that the blushless DC motor business has strong growth potential, since such products are used not just with air conditioners but also with electrical machinery. Global demand for the motors exceeds 1 billion units annually. (SC)