Asustek Computer Inc (華碩) chairman Jonney Shih (施崇棠) yesterday said he shelved a succession plan to help the company overcome industry headwinds.
Shih, 65, told shareholders at an annual general meeting that he was responsible for delaying his departure from the company, despite a rumor that infighting was behind his decision to stay.
Following a turbulent 2017 that ended with declining sales, operating income and net profit, Shih said that he is not ready to pass on the baton while the company is still going through a transition to counter a softening global PC market, unfavorable macroeconomic conditions and rising competition.
Shih had previously been expected to retire at the beginning of this month, but he was unexpectedly re-elected as chairman by the company’s board directors in April.
Shih said that vice chairman and cofounder Ted Hsu (徐世昌) remains the company’s top pick to take over the helm.
The company has given priority to cultivating talent across the organization, he said.
The company expects further challenges ahead, including a brewing US-China trade war and uncertainties about the effects of the New Taiwan dollar’s exchange rate on overseas sales, Shih said.
The company last year laid the groundwork toward a brighter future and greater branding power through efforts, such as a sweeping organizational restructuring, as well as redefining the market position of each product line, Shih said.
Looking ahead, Asustek would continue its transition into a smart enterprise by leveraging artificial intelligence and big data analysis to glean deeper insights into consumer needs as well as yielding cost savings, he said.
Shih said he envisions a future in which industries transition to a consumer-centric model, where supply chains are shortened drastically to adapt to rapidly evolving consumer trends.
Asustek chief executive officer Jerry Shen (沈振來) said the company is facing further challenges this year, particularly regarding component shortages in multilayer ceramic capacitors and memory chips.
The company aims to achieve an operating margin of 4 percent this year and expects its smartphone business to become profitable in the second half.
The company expects revenue to decline by a single-digit percentage this year from last year’s NT$434 billion (US$14.53 billion).
Consolidated sales last month fell 7.5 percent annually to NT$29 billion, Asustek said, adding that in the first five months, revenue slid 9.5 percent annually to NT$150.9 billion.
Asustek shareholders yesterday approved the distribution of a cash dividend of NT$15 per common share, representing a payout ratio of 72 percent based on the company’s earnings of NT$20.93 per share last year.
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