Wed, Aug 14, 2019 - Page 12 News List

Quanta cautious after robust H1 results

By Natasha Li  /  Staff reporter

Quanta Computer Inc chairman Barry Lam, right, accompanied by vice chairman C.C. Leung, attends an investors’ meeting in Taipei yesterday.

Photo: CNA

Quanta Computer Inc (廣達電腦), one of the world’s leading original design manufacturers of laptops, yesterday gave a cautious outlook for the second half of the year, despite posting robust financial results for last quarter.

Among the many variables in the months ahead, the trade dispute between the US and China might evolve into a currency war, Chinese-language news site quoted Quanta chairman Barry Lam (林百里) as saying at an investors’ teleconference.

As a result, the company’s production relocation to Southeast Asia is a must, Lam said, a report in the Chinese-language Liberty Times’ (sister paper of the Taipei Times) Web site said.

While Quanta has shifted part of its server production back to its plants in New Taipei City’s Linkou District (林口) about six months ago, it has not yet set a timeframe for setting up new production sites in Southeast Asia, he said.

With the US levying another 10 percent tariff on about US$300 billion of Chinese consumer goods starting next month, Quanta has armed itself with solutions to resolve rising costs at the clients’ end, the report quoted Lam as saying.

The company reported a 27 percent surge in net income on a quarterly basis to NT$3.97 billion (US$126.05 million) for last quarter, which translated into earnings per share (EPS) of NT$1.03.

Revenue increased 11 percent quarterly to NT$245.74 billion, while gross margin improved to 4.77 percent and operating margin climbed to 1.52 percent, the company’s financial statement showed.

Net income in the first six months of the year amounted to NT$7.09 billion, or EPS of NT$1.84, up 13.1 percent from NT$6.27 billion in the same period last year.

Revenue increased 8.8 percent to NT$467.07 billion, which Lam attributed to relatively stable demand in the US.

Another original design manufacturer of consumer electronics and assembler of Apple Inc’s Airpods, Inventec Corp (英業達), aims to migrate its entire US-bound laptop operation to Taiwan, president Maurice Wu (巫永財) said.

Inventec aims to complete the move within two to three months, Wu told investors on a post-earnings call yesterday.

The firm also intends to shift more output of smart devices to Taiwan and Malaysia, Inventec executive David Ho (何代水) said, without elaborating.

Inventec reported that second-quarter net income fell 19.56 percent to NT$1.37 billion from the previous quarter, or EPS of NT$0.38.

While revenue increased 11 percent on a quarterly basis to NT$127.8 billion due to rush orders in June, gross margin declined to 4.1 percent and operating margin fell to 1 percent as non-operating income fell, but operating expense rose, the company said.

Additional reporting by Bloomberg

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