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Makalot Industrial Optimistic About Future Growth, Expects Record Revenue in Third Quarter

Strong fourth-quarter orders from American clients and strategic capacity expansions drive positive outlook
Taiwan
m 1477.TW Mid and Small Cap 2000 Consumer 250
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Makalot Industrial held a shareholders’ meeting on June 28, where Chairman Li Ping Chou expressed optimism about the company’s prospects for the second half of the year. The company anticipates that its third-quarter revenue will surpass NT$10 billion for the first time, defying the typical off-season trends. Strong orders have set a promising stage for continued growth into the first quarter of next year and beyond.

Chou highlighted the ongoing production capacity planning for the fourth quarter, which is traditionally geared towards fulfilling spring orders for the following year. Positive spring clothing orders generally indicate robust summer demand, suggesting a bright outlook for 2025.

Makalot’s strong fourth-quarter performance is primarily driven by American customers, reflecting a deepening partnership and the successful launch of popular brand products. Chou noted that customer sales have improved year-over-year, with increased shipments and higher customer penetration contributing to this success.

Li Ping Chou added that both sports and lifestyle products have performed well, particularly versatile items that transition seamlessly from day to night or gym to swim. These functional products are gaining mainstream popularity.

Makalot’s capital expenditure for the year is projected at approximately US$40 million, a significant increase from last year’s US$15 million. This investment supports the expansion and construction of four major factories worldwide, including new production lines in Indonesia and Vietnam, as well as new facilities in Bangladesh and El Salvador. Chou stated that the El Salvador factory, slated to begin production in the fourth quarter, will complement the existing Guatemala operations, enhancing coordination and support.

The El Salvador plant, serving nearby American customers, will account for 10-15% of Juyang’s production capacity over the next three years, focusing on small-batch, quick-turnaround products. Similarly, the Bangladesh factory, set to start operations in the first half of next year, will concentrate on high-volume products and is expected to contribute 10-15% to production capacity.

In response to geopolitical concerns, Makalot is implementing a decentralized supply chain strategy. This approach, along with expanded regional supply chain cooperation, aims to improve vertical integration efficiency and increase flexibility and responsiveness.

 

 

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