Mitac plans to fire 150 staff in bid to cut costs

Mitac International Corp (神達電腦) said it will fire a tenth of its staff, or 150 workers, to cut costs, and will report first-half profit fell by more than a third as the Taiwan computer maker slashed prices to boost sales.

Mitac expects to save about NT$150 million (US$4.4 million) from the dismissals, the company said in a statement to Taiwan's stock exchange. Profit in the first six months will fall 36 percent on year to NT$530 million, and sales will drop 10.5 percent to NT$17 billion, the company said.

Taiwan's companies have fired workers and cut profit estimates as demand for the island's computers, mobile phones, and semiconductors fails to pick up.

Mitac shares rose as much as NT$1.1, or 5.9 percent, to NT$19.90 in earlier trading. The stock has fallen a third in the past year, compared with a 40 percent plunge in the main TWSE Index.

Mitac, founded in 1982, began as an exclusive manufacturer of PCs, and has since become an international supplier of IT products.

Meanwhile in related news, Lite-on Semiconductor Corp (建興半導體), which makes chips that help process images in scanners and video intercoms, said it will fire 150 employees, or 7 percent of its workforce, to cut costs.

Taipei-based Lite-On Semiconductor expects to save about NT$100 million (US$2.9 million) from the dismissals, increasing its competitiveness and profitability, the company said in a statement to the Over-the-Counter Securities Exchange.

Lite-On Semiconductor is the second publicly traded company in Taiwan that announced reduction of staff yesterday following the similar move by Mitac International, which makes computers for Compaq Computer Corp and Hewlett-Packard Co, to fire a tenth of its staff to boost competitiveness as profits and sales slump.