Wed, Mar 19, 2014 - Page 14 News List

Oversupply, lower prices see Wintek stay in the red

By Lisa Wang  /  Staff reporter

Wintek Corp (勝華), which supplies touch panels to Amazon.com Inc and Chinese handset maker Xiaomi Corp (小米), yesterday posted an annual loss of NT$8.7 billion (US$286 million) for last year as oversupply and price reductions eroded profits.

The loss increased from 2012’s NT$3.95 billion, marking the third straight annual loss for the Greater Taichung-based company, according to a company financial statement submitted to the Taiwan Stock Exchange yesterday.

Gross margin declined to minus-4.24 percent last year, compared with 2.42 percent in 2012, the statement showed.

Revenue shrank about 25 percent to NT$76.4 billion last year, from NT$102.18 billion the previous year.

In the fourth quarter last year, net losses increased to NT$3.83 billion on a consolidated basis, compared with a loss of NT$2.71 billion in the third quarter, according to the financial statement.

No corresponding figures were provided for comparison.

The quarterly loss included NT$3.3 billion in asset impairments.

Wintek has said it expects a pickup in its business in the second half of this year as demand for smartphones and tablets is likely to be slow in the first half.

As part of its cost-saving efforts, Wintek has shut down two factories and extended the period of booking equipment appreciation and amortization to 10 years from six, the company said in a statement released early this month.

Wintek said that would help save about NT$2.62 billion in appreciation costs this year.

The touch panel maker said earlier this month that it plans to offer as many as 200 million new common shares in the form of global depository receipts. The proceeds would be used to buy raw materials overseas and to repay bank loans, the company said.

Wintek shares tumbled 2.83 percent yesterday to close at NT$10.3, under-performing the TAIEX, which gained 0.37 percent.

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