Yuan depreciation, stronger NT dollar cause Inventec net income to stagnate

By Lauly Li  /  Staff reporter

Wed, Mar 29, 2017 - Page 12

Inventec Corp (英業達) yesterday reported almost flat net income of NT$5.63 billion (US$186.6 million) for last year, compared with the NT$5.56 billion in 2015, mainly due to foreign exchange losses of NT$1.92 billion.

Earnings per share were NT$1.57 last year, of which the foreign exchange losses eroded NT$0.53, Inventec chief financial officer Yu Chin-pao (游進寶) said.

“Inventec’s core businesses grew steadily last year. The only headwind was the depreciation of the yuan and the appreciation of the New Taiwan dollar,” Yu told an investors’ conference at the company’s headquarters in Taipei.

Gross margin climbed by 0.11 percentage points to 5.6 percent last year, while operating margin was up by 0.53 percentage points to 1.9 percent, company data showed.

While the foreign exchange rates remain an unpredictable factor this year, Inventec is forecasting that its revenue will outpace last year’s NT$428.46 billion on robust demand for servers, handheld devices and commercial notebook computers, Yu said.

Inventec president Huang Kuo-chun (黃國鈞) said robust server demand from HP Inc, Dell Inc and Lenovo Group Ltd (聯想) would boost Inventec’s server revenue by between 5 and 10 percent this year.

Shipments of data center racks and cabinets are expected to jump between 20 and 30 percent year-on-year on clients’ growing orders, Huang said.

Overall server-related sales, which contribute more than 30 percent of the company’s total sales, are forecast to climb 10 percent this year from last year, he added.

Inventec handset subsidiary Inventec Appliance Corp (英華達) chief executive David Ho (何代水) said that revenue and shipments of handheld devices would both expand by a double-digit percentage this year.

Inventec Appliance has more than 10 clients and the company plans to keep diversifying its client base, Ho said.

Inventec Appliance, which accounted for 19.2 percent of Inventec’s total sales, manufactures a wide range of smart devices, including Apple Inc’s AirPods wireless earphones and Xiaomi Corp’s (小米) smartphones.