Know More About Unionmet

Know More About Unionmet

Unionmet, which has a manufacturing plant in Liuzhou, China, mainly produces and sells indium ingots - an essential raw material for flat panel displays and solar energy batteries. It also sells zinc related by-products in the extraction process, which are used in the car and construction industries.

The company aims to expand its indium ingots production capacity to 35 tonnes per year from 25 tonnes per year through technical upgrades. It also hopes to develop products used in 3G mobile communications, satellite communications and optic fibre communication devices in the near future.

According to Unionmet's most recent audited financial statements, net profit for the year ended Nov 30, 2005 came to US$8 million, while revenue totalled US$26.1 million. For the six months to May this year, it reported net profit of US$4 million and revenue of US$22 million.

Unionmet's main customers are traders, consumer electronics manufacturers, indium-tin-oxide (ITO) producers and low melting point alloy makers. Its main markets are Japan, South Korea, Europe and the US.

Unionmet said that one risk it faces stems from dependence on major customers with which it does not have term contracts, in accordance with market practice in the industry. For FY05, sales to the company's two largest customers - Wogen Resources and Marubeni Corporation - accounted for 31 per cent of the group's revenue.

To secure sales in the international market in the long run, Unionmet said that it is negotiating with several reputable ITO end-users and international traders for sales contracts of up to nine months. It also expects to clinch long-term indium sales contracts with its major customers.

The company was incorporated in Singapore two years ago and undertakes the marketing and sales activities of the group.

It has two subsidiaries in China - Intai which produces indium ingots and UnionZinc which extracts indium slag and strip liquor from which it derives by-products.

Unionmet said that it does not have a formal dividend policy, but its directors intend to recommend and distribute dividends of not less than 30 per cent of its net profit attributable to shareholders for FY2007. Stirling Coleman Capital is the lead manager and UOB Kay Hian, the underwriter, for the listing.