Thu, Jun 23, 2011 - Page 12 News List

Wistron predicts weak laptop sales

CHALLENGING TIMES:The company’s net profits grew 32% to about NT$12bn, or NT$6.15 a share, last year compared with NT$913 million, or NT$4.98 a share, the previous year

By Lisa Wang  /  Staff Reporter

Wistron Corp (緯創), the world’s third-biggest contract laptop computer maker, yesterday detailed a lackluster future for the notebook computer industry, saying that the wobbling global economic recovery and Apple Inc’s tablet device would cut notebook demand in the second half of the year.

Wistron chairman Simon Lin (林憲民) made the remarks, making him the latest in a slew of local electronic industry heavyweights to express their concern that shaky global economic recovery could weaken demand for chips and end products in the traditional high season for the electronics sector during the third and fourth quarters.

“I am not as optimistic about the second half of the year [as I was],” Lin said during the company’s annual shareholder’s meeting.

That was Lin’s latest comment on the economy and PC industry, which he said were undergoing “drastic changes.”

“We do not see any optimistic signs on the economic front. We see growth [opportunities] only in emerging markets ... But, it will be difficult to count solely on emerging markets to drive a big rebound,” Lin told reporters on the sideline of the meeting.

The ups-and-downs of the PC and consumer electronics sectors always match the movements of global economy, while economic recovery in the world’s major economies — Europe, the US and Japan has seemed in a somewhat precarious state recently, he said.

Earlier this month, market researcher Gartner Inc trimmed its global PC shipment forecast to growth of 9.3 percent from last year to 385 million units this year, citing weaker demand from consumers in developed countries. Three months ago, Gartner expected global PC shipments to increase 10.5 percent annually.

The already weak demand for laptop computers this year has been exacerbated by Apple’s iPad. However, Lin said he did not expect the tablet devices’ cannibalization to last long, adding that tablets will create a new market segment for portable device makers.

This year would be crucial for PC makers to sell their new tablet products to test the waters before trying out new-generation products and new business models, Lin said.

“Tablets are not a major part [of the whole laptop computer market], but a minor part,” Lin said. “I believe that next year will be a better period for non-Apple tablet makers.”

Wistron shareholders yesterday approved the proposal to pay a cash dividend of NT$3.2 per common share and NT$0.5 per share as a stock dividend based on last year’s record-high net profits.

Wistron’s net profits grew 32 percent to about NT$12 billion (US$416 million), or NT$6.15 a share, last year, compared with NT$913 million, or NT$4.98 a share, a year earlier.

Last year, the PC maker shipped 27.45 million laptop computers, up 7.6 percent from 25.5 million units in 2009.

Shareholders also gave the go-ahead to the proposed sale of up to 250 million shares via a rights issue or in the form of global depositary receipts.

Shares in Wistron rallied 1.36 percent to NT$52.2 in Taipei yesterday.

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