Power cable and stainless steel manufacturer Walsin Lihwa Corp (華新麗華) is reducing its copper wire and bar business in China by selling a copper factory in Nanjing to one of its top three customers there.
The company told shareholders on Friday that it decided to sell the factory for around NT$6.4 billion (US$203.5 million) to Gree Electric Appliances Inc of Zhuhai (珠海格力電器), China’s biggest air conditioner maker.
“The reason for selling our Nanjing unit is due to fierce competition in the Chinese copper market. Gree Electric Appliances has been seeking integration among its upstream and downstream suppliers, so it came to us as a cooperation opportunity,” a Walsin Lihwa official told the Taipei Times by telephone yesterday.
The official, who asked to remain anonymous, said the sale would not make Gree Electric Appliances its competitor in China’s copper business, as Gree is more centered on the Chinese market and Walsin Lihwa is more about foreign markets.
The Nanjing factory produces 300,000 tonnes of copper wires and bars per year. It reported annual revenue of NT$48.3 billion for last year, accounting for 25.3 percent of Walsin Lihwa’s total revenue, company data showed. The factory reported a net income of NT$214.28 million for last year, contributing less than NT$0.1 in earnings per share, the official said.
“The sale is still under review by the local government in China. The company is expected to book the profit next quarter at the earliest, or early next year at the latest,” the official added.
Walsin Lihwa also operates copper factories in Dongguan in China’s Guangdong Province and in Yangmei District (楊梅) in Taoyuan. The Dongguan factory produces 70,000 tonnes of copper bars per year, while the Yangmei plant makes 180,000 tonnes, it said.
The company’s cumulative revenue for the first four months this year dipped 27.51 percent to NT$51.21 billion, from NT$70.64 billion a year earlier, affected by the lingering US-China trade dispute.
The company said it remains conservative about its core business this year, as the trade dispute has reduced customer demand while causing fluctuations in raw material prices and foreign exchange rates.
However, the return of Taiwanese firms from China will increase the demand for copper wire as they set up new factories and offices in Taiwan, Walsin Lihwa said.
The company said it would focus more on raising its gross margin and customized copper and steel products based on customers’ needs this year.
In addition, the company’s new shopping mall in Nanjing and real-estate projects in China will contribute to its sales this year, it said.
Walsin Lihwa’s first-quarter net income plunged 86.78 percent annually to NT$512.74 million, compared with NT$3.88 billion a year earlier.
Earnings per share dropped from NT$1.17 over the same period to NT$0.15, while gross margin also declined by 7.89 percentage points to 5.14 percent, company data showed.
Walsin Lihwa shares yesterday closed down 0.64 percent at NT$15.5 in Taipei trading. They have dropped 7.46 percent so far this year.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last