Allied Material Technology Corp (展茂光電), the nation's second-biggest maker of color filters for flat panels, yesterday said it would soon trim its workforce by about 8 percent to cope with the latest overcapacity-driven trough.
Facing financial difficulties, the company announced a major shake-up in its management team last month, affecting the company chairman and president.
Allied Material yesterday said it planned to lay off more than 70 workers after the Lunar New Year holidays, a filing to the Taiwan Stock Exchange showed. The company Web site shows that its workforce numbers 970 employees.
The Chinese-language Commercial Times reported that Allied Material planned to slash 150 jobs after suspending operations at a plant.
Dismissing the report, Allied Material said it only planned to cut production during the coming slow period in the flat-panel industry at two of its three factories and thereby minimize the impact of oversupply.
Color filters, among the main components in thin-film-transistor liquid-crystal-display (TFT-LCD) panels, represent approximately 20 percent of the total cost of a 17-inch computer panel.
Shares of Allied Material dropped 6.8 percent to NT$3.69 yesterday on the nation's over-the-counter GRETAI Securities Market after the stock was restricted from marginal trading on poor financials.
Allied Material posted losses of NT$1.75 billion (US$53.1 million) for the first three quarters of last year, compared with net income of NT$76.93 million in 2005.
The company board approved the proposal of raising a maximum NT$3 billion via private placements to reduce losses and improve operations. The company failed to pay NT$329 million in interest, due on Feb. 12, on a syndicated bank loan.
The company also rebutted speculation that its customers had switched to bigger rival Sintek Photronic Corp (
"None of our customers has canceled orders," chief executive Charles Yu (