Tue, Sep 18, 2012 - Page 13 News List

Eurozone, industry woes continue to plague local firms

EXPORT-RELIANCE:New research indicates that the nation’s economy is set to struggle, with politicians calling for free trade deals to be made a key priority

By Crystal Hsu  /  Staff reporter

Taiwan’s listed firms may see profits shrink between 6 percent and 10 percent this year amid industrial realignment and the global slowdown, although the situation may improve in the second half, Schroder Investment Management Taiwan Ltd said yesterday.

“Taiwan’s technology firms are under pressure to shift from 3C to 1C — namely from the sale of computers, communications and consumer electronics products to an emphasis on cloud-computing technology,” Schroder vice president Tony Chen (陳同力) told a media briefing.

The trend, coupled with Europe’s debt problems, contributed to the weak earnings of Taiwan-listed firms, which reported a 35.8 percent decline in profits for the first six months compared with the same period last year, Chen said.

The showings may improve in the second half, aided by the launch of new-generation products by Apple Inc, Microsoft Corp, Amazon.com Inc and other technology giants, Chen said.

Apple Inc, which unveiled its iPhone 5 last week, may release a widely anticipated iPad Mini — a smaller version of its popular iPad tablet computer — later this year, Chen said, adding that Microsoft is slated to market its own Surface tablet and that Amazon is to sell its latest e-reader to take advantage of the upcoming Christmas shopping season.

Taiwanese smartphone maker HTC Corp (宏達電) and PC vendor Acer Inc (宏碁) are to jump on the bandwagon with their own signature products, Chen said.

The marketing strategy is to benefit firms in their supply chains, boosting their shipments this month and next quarter, Chen said, adding that the pickup may ease the decline in earnings this year to high single digits.

“The sell-through performance will decide if the momentum can extend into next year,” he said. “It is too early to tell now.”

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