FEMCO Expected to Score Higher Profits This Year

Taipei, May 22, 2006 (CENS)--Thanks to successful corporate re-engineering, Far East Machinery Co., Ltd. (FEMCO), one of Taiwan' s leading manufacturers of machine tools, saw a 31% annual growth in sales with earnings increasing by five times last year.

FEMCO executive C.Y. Huang expressed optimism that his company would keep growing this year. He vowed to revitalize FEMCO' s good reputation in Taiwan' s domestic machine-tool industry.

The company currently has several business units, including machinery, machined parts, steel pipes, engineering, and golf clubs. Over the past few years, the company has found success in elevating its industrial competitiveness by focusing on upgrading R&D, manufacturing, and after-sale services.

Founded in 1949, FEMCO adopts the ''FEMCO'' own brand on its products sold at home and abroad. Over the past several years, the company has been making all-out efforts to diversify its product lines. At present, FEMCO is the world' s second-largest producer of golf-club shafts.

FEMCO encountered operating difficulties a few years ago when the global machine-tool industry fell into a period of stagnant growth, but in recent years the company has regained its momentum based on its core competence of machinery and engineering.

The company said it posted NT$3.386 billion (US$105.81 million at US$1:NT$32) in sales last year, up 31% year-on-year. After-tax earnings grew five-fold to reach NT$178 million (US$5.56 million) last year, and its average gross profit margin grew to 16% from the preceding year' s 12%.

FEMCO is the first domestic manufacturer of steel pipes to be certified by the American Petroleum Institute (API), and the company has installed a great deal of state-of-the-art production equipment to churn out sophisticated steel pipes that have been distributed worldwide.

Thanks to its long-term efforts to develop innovative products, FEMCO has won many prominent awards. For instance, in 2003 the company won the Symbol of Excellence presented by Taiwan' s Ministry of Economic Affairs for its WHL-model CNC (computerized numerically controlled) wheel-making machines.

At the 2005 Taipei International Machine Tool Show (TIMTOS) held in March at the Taipei World Trade Center, FEMCO won the first prize in the ''Machine-tool Research, Development, and Innovation'' competition for its HL-25DM CNC lathe, which has f environmental protection features.