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BenQ believes sales set to soar after difficult period

BenQ Corp (明基), Taiwan's top mobile phone maker, yesterday said sales would expand nearly 40 percent this year after incorporating Siemens AG's mobile unit last October.

BenQ's sales for this year would grow to around US$7 billion (US$218 million), up almost 40 percent from US$50.4 billion last year, BenQ chairman Lee Kun-yao (李焜耀) said in a speech yesterday without elaborating.

The increase would bring the total sales of BenQ and its affiliates including the world's No.3 flat panel maker AU Optronics Corp (友達光電) to US$20 billion, up approximately 62 percent, from US$12.36 billion last year, Lee said.

"Now we can see the growth in the Chinese market will be quite significant this year," company president Sheaffer Lee (李錫華) told the Taipei Times, adding the pace of growth in Europe and the Asia Pacific region would also be fast.

BenQ remains committed to the goal of turning around the money-losing handset division acquired from Siemens last year, though some analysts have said the target is too aggressive, Lee said.

"It's a tough task," Lee admitted.

BenQ accumulated losses of NT$10.22 billion over the past two quarters since the takeover took effect in October, according to the company's filing to the Taiwan Stock Exchange.

Lee made the comments on the sideline of a press conference unveiling BenQ's new products including handsets with better-resolution OLED screens, sleekness in shape and enabling users to transmit on next-generation, or 3.5G, networking. Those products are to be showcased at the annual Computex Taipei show.

Lee also said the company would be able to hit the second-quarter target by improving its profits on cost-savings and better selling prices.

BenQ told investors in April that selling price would grow 10 percent this quarter from the first quarter as it would focus on unveiling high-end models as well as reduced inventory.

In addition, handset sales would jump 30 percent this quarter from the 7 million units sold in the January-March period, it said.

These two factors along with more stringent cost control would help sales to rise 10 percent at quarterly rate in the three-month period ending June, the company said.

As of yesterday, shares in BenQ had fallen about 20 percent to NT$22.45 since its absorption of Siemens' mobile unit last October. Meanwhile the benchmark TAIEX index gained nearly 10 percent during the same period.
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