Makalot Industrial Co., Ltd. E版.pdf · 2017-03-28 · Global Market . Makalot Industrial Co.,...

Makalot Industrial Co., Ltd. 1

Makalot Industrial Co., Ltd.

March, 2017


Table of Contents

1. Company Overview

2. Financial Highlight

Agenda


A Glance at Makalot Company Overview

Makalot’s Strength Main Strategies

A well known integrated coordinator of apparel supply chain in Asia

Strong management: Creating best formula to

stable margin through international production

bases across 5 countries with diversified

production lines.

Value added service: Providing our customers

with one-stop shopping experience and high

value add services in design, material sourcing

and speed to market.

Vertical integration: An addition of a fabric mill

in Vietnam though JV in 2013 enables Makalot

to upgrade its control over quality of material

and lower production cost.

Diversified Products

Global Market


Company outline

• Ready toWear

• Sleepwear

• Activewear

• Sportswear

• Outdoor

• Uniform

•Department stores

•Mass Channels

•Brands

•Vietnam

•Indonesia

•Cambodia

•China

•Philippines

Product line Production base

Company Overview

Product line Customer style Production base


2017 & Beyond

US economy improvement will boost consumer demand The US economy recovers gradually, as employment rate is on the rise.

Europe and Japan continue growing from trough.

Big vendors become bigger With buyer’s vendor consolidation plan, big supplier would gain more market shares.

Stronger co-operations benefitting vendors with stable finances and diversified production bases.

Barrier to entry due to stronger demand for large scale productions and innovation capabilities.

Looking outside for garment production Production moving out of China due to wage growth and worker shortage.

Company Overview


Competitive Advantage & Growth Driver

3 N New markets

New customers

New products

2 V Vendor consolidation : Makalot continues to gain market share in recent years.

Vertical integration : cost and quality control, Makalot can provide buyers with attractive prices.

In the next 5 years,

5 Key Growth Drivers = 3 N ( New markets, New customers, New products) + 2V (Vendor Consolidation + Vertical Integration)

Competitive Advantage : Diversified & Flexible & Integrated

Diversified

• 5 production countries

• Customers from different segments

• Diversified product categories

Flexible

• 5% ~ 10% outsourcing

• Quick replenishments

• Inventory management

Integrated

• Multiple Products

• Design services

• Material souring

Company Overview


Operating Highlight Company Overview

Revenue by Product Line 2016 Revenue by Customer 2016

Makalot’s top key customers are Gap, Kohl’s, Target, Hanesbrands, and Japanese Customer.

Actively expanding into Asia market and Functional sportswear market.

Top clients revenue proportion diagram

Revenue by Country 2016


Global Network/Production Sites Company Overview

We can quickly adjust capacities among these sites to capture low-cost advantages.

Capacity Distribution Chart (Country / Production %)

0%

10%

20%

30%

40%

IND VIN CAB CHN PHL

2012

2013

2014

2015

2016


Overheads

10%

Accessories

16%

Fabrics

58%

Labor

16%

Cost Breakdown

Material 60%

Labor 13%

Overheads 7%

Gross Margin 20%

Cost Structure based on ASP Cost of good sold breakdown

Company Overview


Regional Peers Company Overview

Updated on Feb , 2017


Financial Highlight

Financial Highlight


ASP/ Shipment Financial Highlight

Shipment

(m’dz) ASP

0

10

20

30

40

50

60

70

80

-

5.00

10.00

15.00

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Shipment (million dozen) (LHS)


Debt Ratio

2016 Net Cash position = NT$ 1,194 million = NT$ 1,749 million cash on hand - NT$ 555 million debt

Financial Highlight

8.41%

16.24%

3.36% 1.73%

4.22%

0%

5%

10%

15%

20%

2012 2013 2014 2015 2016

Total debt / total assets

-54.08%

11.66%

-15.14%

-29.51%

-9.10%

-60%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

2012 2013 2014 2015 2016

Net debt to equity


Capital Expenditure

2013 capex was about US$ 11.55 million (NT$ 346 million)




In 2013, We purchased HQ in Taipei by NT$ 2.82 billion and invested Vietnam fabric mill by NT$ 133 million.

Financial Highlight

million NT$

394

252

346 403

766

643

0

100

200

300

400

500

600

700

800

900

2011 2012 2013 2014 2015 2016 2017


Financial Highlight

FX gain/loss

Hedging strategies

1. Put in place much more conservative FX budget forecasts for the upcoming year.

2. Cash flow hedges to reduce the exposure to variability in certain expected future cash flows.

Natural hedge = 80%, and net exposure position= 20%. Using USD/NTD forwards to hedge this

20% net position risk.

2007 2006 2005 2004


Dividend Policy

Mainly cash dividend payout ratio will be maintained between 70% and 90%.

Financial Highlight

NT$


Convertible Bond

In 2012, we issued 1 convertible bonds (CB4) with par value of NT$700mn.

CB4 potential dilution is 1.12 %.

Updated on Mar , 2017

Financial Highlight

DurationIssue Amount

(NT$mn)

Outstanding

Amount (NT$mn)

Conversion Price

(NT$)

Potential Conversion

(mn shares)

Dilution

(%)

CB4 Aug. 24, 2012- Aug. 24, 2017 700 152.7 65.9 2.3 1.12%


2012- 2016 Business Cycle

1Q & 3Q are strong season

Financial Highlight

% to annual shipment volume


Makalot’s History

Founded in Taipei with woven apparel as the primary business

Established a production facility in the Philippines and forged an OEM strategic alliance in Taiwan 1990

Ventured into the knitted apparel production industry 1994

Established an IT Department to promote computerized operation in the firm

Developed diversified product strategy 1997

Purchased the headquarters building

Established Demak production factory in Indonesia

Invested in Namtex Co., Ltd., Vietnam

2013

Started global production strategy 1998

Established a production facility in Indonesia 2000

Expanded the Cambodia apparel production 2001

Expanded the apparel production strategic alliance in Vietnam 2002

Established the Design Planning Department to enhance ODM service capability 2003

Turnover exceeded NT$10 billion 2004

Expanded the apparel production strategic alliance in Vietnam 2005

Established the South Vietnam and China production facility 2006

Established Ecolot Textile Co., Ltd 2010

New Green Sportswear Plant in Vietnam 2015


Q&A

Thank You

Thank You

Makalot Industrial Co., Ltd. E版.pdf · 2017-03-28 · Global Market . Makalot Industrial Co.,...

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Transcript of Makalot Industrial Co., Ltd. E版.pdf · 2017-03-28 · Global Market . Makalot Industrial Co.,...