Thu, Oct 13, 2005 - Page 10 News List

Semiconductors sector still tops: report

By Jackie Lin  /  STAFF REPORTER

In the manufacturing and service industries, the semiconductor and telecommunications sectors reported the strongest profitability last year, according to a report released by the Taipei-based China Credit Information Service (中華徵信所) yesterday.

The report collected the financial statements of 2,626 companies in these two industries -- including 1,244 companies whose shares are traded in open markets as well as the remaining 1,382 businesses whose stocks are not publicly traded -- in an effort to analyze their financial performances and efficiency.

Five components -- gross margin, operating profit margin, net profit margin, return on equity (ROE) and revenue growth from the previous year -- were calculated for the final evaluation.

Deemed as a cash cow, the semiconductor sector last year recorded the strongest operating profit margin of 21.2 percent and a net profit margin of 21.7 percent in the manufacturing industry.

In the service industry, the regulated telecommunications sector reported the strongest operating profit margin at 29 percent and a net profit margin of 28.5 percent.

Chang Chien-yi (張建一), deputy director of research division II at the Taiwan Institute of Economic Research (台經院), said that Taiwan has a strong competitive edge, especially in the high-tech industry, but needs to strengthen investors' sagging confidence.

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