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Dynacast back in the black in 1st quarter

Keywords: Tags  Dynacast International, zinc, aluminum, metal die cast, earnings report, Simon Newman, China, Saranya Kapur

NEW YORK — Dynacast International Inc. returned to profitability in the first quarter due in part to increased demand for consumer electronics.

The Charlotte, N.C.-based producer of small metal die cast components using aluminum, magnesium and zinc alloys reported a 60-percent increase in the company’s Chinese operations, with most of the growth coming from new customers, according to chief executive officer Simon Newman. "All our new customers (for the China plant) are from the consumer electronics market," he said during an earnings conference call. "The plant is nicely situated, surrounded by specialty coatings plants—which our large customers have demand for—so we can add value to the products we provide for them."

While labor costs in China have risen, the company believes the nation remains more cost-effective than other countries. "It’s still very low labor cost compared to many other places," Newman said. "While there was a 13-percent increase in the minimum wage, this was on very low numbers to begin with."

Dynacast posted net income of $300,000 for the three months ended March 31 vs. a net loss of $400,000 in the same period last year on sales that increased 8.3 percent. North American sales remained flat in the quarter at $43 million.

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