Sat, Jun 15, 2019 - Page 12 News List

Micro-Star mulls moving more production home

By Natasha Li  /  Staff reporter

Micro-Star International Co (MSI, 微星科技), a major vendor of gaming computers, graphics cards and motherboards, yesterday said that it is weighing the possibility of moving some production lines from China to Taiwan and Southeast Asia.

The company has a conservative outlook for business in the next few months.

It said it was considering relocating as it responds to rapid changes and uncertainties caused by a US-China trade dispute.

Other companies in the industry’s supply chain have made such moves to avoid heavy tariffs imposed by Washington on Chinese goods, a company official said by telephone, quoting MSI president Joseph Hsu (徐祥).

Hsu told a shareholders’ meeting that relocating the production lines would entail high costs, leading to higher pricing of its products.

MSI usually makes about 55 percent of its overall revenue in the second half of the year, but Hung said that the pattern might be different this year, as market volatility might curb demand and weigh on its production.

Previously, the company predicted total shipments of 20 million printed circuit boards this year, a forecast that might not materialize, the official quoted Hsu as saying.

Laptop shipments to China and Europe have decreased by an estimated 10 percent, Hsu said, adding that sales of high-end graphics display cards failed to meet expectations in the first quarter.

With Advanced Micro Devices Inc and Nvidia Corp planning to release new central processing units and graphics card next month, Hsu expressed hope that new products would boost demand.

MSI has reported negative growth in revenue for four straight months since February with an annual decline of 7.99 percent last month to NT$9.04 billion (US$286.7 million).

Cumulative revenue in the first five months of the year totaled NT$47.06 billion, down 8.7 percent from NT$51.55 billion a year earlier, company data showed.

Shareholders approved an MSI plan to distribute a cash dividend of NT$4.5 per share, representing a payout ratio of 62.94 percent based on last year’s earnings per share of NT$7.15.

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