2017 Operation Perspectives

Directors and stockholders, thank you and look forward to having your opinion on 2017 operation perspectives.
The global economic situation of the first half of 2016 is weak and lack of motivation. Particularly, the industry competition intensified, and the exclusion effect of overcapacity and supply chain autonomy in China impacted the main national trade. Taiwan’s export situation has decreased for 17 months. The exchange fluctuation between RMB and NTD caused exchange loss to enterprises. Each factor influenced enterprises’ profits but the circulated economic rebound showed up in the second half of 2016. The expectation of economic performance in 2017 is positive although there are still lots of potential and uncertain risks which might limit the strength of recovery and affect the economic trend.
In regard to TGI’s performance in 2016, it has improved significantly to compare with the recent two years. We make a brief report by product lines as follows.
In flat glass, both production and marketing in Taiwan is stable, and the percentage of market share is around 80%. The flat glass TGI’s Taichung Factory and Lukang Factory produced has been reached the world class and laid a foundation for high class building material. Due to the problem of energy shortage in Taiwan, TGI continued to popularize Low-E energy-saving glass and enlarge the sales volume of energy-saving glass products to implement environmental awareness, and integrated its industrial chain, strived for the visibility of international brand and order from high-priced customers by its experienced production and marketing teams.
In new material ultra-thin glass, the products are mainly sold to China; meanwhile TGI has started to supply the product of high-level car mirror regularly since it obtained formal orders in March of 2017 after sampling to get certificate for one year. China flat glass market is still in the stage of structure innovation now. Moreover, China Authority implements environment protection strictly so that the supply aspect is decreased slightly. Due to the rebound of whole real estate market, the sales price has been rising gradually since the second half of 2016. TGI’s China flat glass factories are extended to 12 cities and 14 factories with the advantages of flexible management, specialization and automation, enhancing the high value added products effectively to supply products to China market adequately.
In fiber glass, TGI’s products are stable to supply, and has firm foundation of reputation. Under the population of Low-Carbon Economy, the electronic products are developed toward the goal of light type. This trend enlarges the using amount of complex fiber glass material. Meantime the mature application of IoT (Internet of Things) and the needs of network communication, mobile device, emerging self-driving car, and etc. are expected to motivate the growth on the needs of industrial class and electronic class fiber glass. TGI’s thin, high precision and high strength fiberglass fabric has market competitiveness. For the fast economic circle of electronics industry, TGI has to fully satisfy customers’ requirement on specification, package and delivery date, and provide flexible service to cope with the market changes in the future.
In container glass, the exported products have been well received by European clients. TGI has promoted its publicity, created various channels, optimized online check and QC equipment, and maintained stable quality and excellent personnel service. The quality and production efficiency of TGI’s tableware has been promoted by updating its furnace and equipment. Furthermore, TGI provides clients various choices with customized multi-printing and packaging processing abilities, and combines with other industrial products to apply on marketing.
Shihlien Chemical Industrial Jiangsu Co., Ltd. (SCJ) manufactures soda ash and ammonium chloride, has reached a capacity of 980,000 tons per annum each. To raise added value of products and cooperate with the China policy of encouraging industrial restructure and upgrade, SCJ has planned to involve in R&D and production of life and health industry to manufacture sodium chloride raw material, salt and salt for animals with a capacity of 300,000 tons and Alkaline water with a capacity of 450,000 tons.
Looking to the future, the international economic situation and both domestic and international investment environment are objective issues TGI has to concern about. For example, the implement of “one fixed day off and one flexible rest day” of Labor Standards Act led to 2% increase to TGI’s cost, besides, TGI has its employee 3% raise. Under the situation, TGI’s cost were total 5 % increased. The commerce and industry expect Government to fix the Labor Standards Act by adjusting limitation of overtime higher per month and relaxing the working-hour specification so that they can reach a win-win situation of employers and employees by arrange production and manpower flexibly to increase capacity and decrease cost.
Under the versatile boom, TGI must assure it has well competition conditions. Over the 52 years after startup, TGI devotes itself to cultivate great persons, develop high unit price products, boost operation management, strength channel layout and marketing service and carry out corporate social responsibility including economy, environment protection, labor care and products responsibilities, making progress and boom to the corporate as well as society. TGI expects to implement sustainable operation by achieving the goal of financial structure strengthened and business development.

 Lin,Por Fong
2017.06.08