Tue, Nov 15, 2016 - Page 12 News List

Hiwin to spend at least NT$4bn for expansion

By Kuo Chia-erh  /  Staff reporter

Hiwin Technologies chairman Eric Chuo, center, speaks at an investors’ conference in Taipei yesterday.

Photo: CNA

Hiwin Technologies Co (上銀科技), the nation’s leading machinery maker, yesterday said it plans to invest between NT$4 billion and NT$5 billion (US$125.2 million and US$156.5 million) next year to expand capacity to meet rising demand.

That represents an increase of between 14 and 43 percent from this year’s NT$3.5 billion.

The money will be spent on building three new plants in Chiayi, Taichung and China’s Suzhou, company chairman Eric Chuo (卓永財) told reporters after an investors’ conference in Taipei.

A new factory in Chiayi Dapumei Precision Machinery Park (嘉義大埔美精密機械園區) is to be completed by the end of this year, while another in Taichung City Refined Mechanics Industrial Park (台中精密機械科技園區) is to start operations in the second half of next year.

The first phase of the Suzhou plant’s construction is to be completed in July next year, which would supply products directly to the Chinese market.

In addition, Hiwin plans to move a Hsinchu-based subsidiary’s facilities and equipment to Suzhou, Chuo said.

The subsidiary, Luren Precision Co (陸聯精密), produces gear-cutting tools and spin pumps.

Asked about the sales outlook for next year, Chuo said he is upbeat about the company’s growth momentum, as demand for high-end equipment, such as five-axis machines, is likely to remain robust.

In the third quarter of this year, Hiwin’s net income dropped 18.4 percent to NT$324 million on a quarterly basis, with earnings per share falling from NT$1.45 to NT$1.18, company data showed.

Gross margin during the same period fell to 32.6 percent, compared with the previous quarter’s 34.2 percent.

The company attributed the weaker performance to the New Taiwan dollar’s appreciation against the euro and the yuan, which caused a foreign-exchange loss of NT$150 million last quarter.

In the first three quarters of this year, Hiwin accumulated foreign-exchange losses of NT$273 million, company associate vice president Leo Liao (廖克皇) told investors.

Consolidated sales last quarter fell 3 percent to NT$4.22 billion from the previous quarter, due to reduced orders from European clients during the summer break.

Among Hiwin’s products, linear guideways contributed 62 percent to total revenue in the third quarter, while ballscrews and industrial robots took up 23 and 7 percent respectively.

Hiwin shares dropped 2.72 percent to close at NT$125 in Taipei trading yesterday, underperforming the TAIEX, which fell 0.19 percent.

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