Formosa Plastics Falls After Net Misses Estimates: Taipei Mover

Formosa Plastics Corp. (1301), Taiwan’s biggest maker of polyvinyl chloride, fell to the lowest in more than a month in Taipei trading after reporting lower 2011 earnings and dividend.

The shares declined 2 percent to NT$87.10 as of 1:30 p.m. local time, the lowest close since Feb. 13. The Taiex Index (TWSE) rose 0.1 percent. The stock has gained 8 percent this year, trailing the benchmark’s 13 percent advance.

Net income dropped 22 percent to NT$35.7 billion ($1.21 billion) last year, Formosa Plastics said in a statement yesterday. The average of 15 analyst estimates compiled by Bloomberg News was for a profit of NT$38.6 billion. The company plans to pay a cash dividend of NT$4 a share for 2011.

“Its cash dividend yield falls to 4.5 percent from more than 5 percent over the past few years,” Jun Liao, vice president at Taipei-based Grand Cathay Investment Services Corp., said by telephone today. Liao has a neutral rating on the stock and expects the company to post a NT$36.7 billion profit this year.

Formosa Plastics’ board also approved a proposal to sell as much as NT$12 billion of bonds, according to a separate statement issued yesterday. The company said it plans to invest an additional $170 million in a steel venture in Vietnam.

To contact the reporter on this story: Adela Lin in Taipei at

To contact the editor responsible for this story: Alexander Kwiatkowski at

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.