Trade dispute has Walsin cautious about second half

LONG-TERM OPTIMISM::Chairman Chiao You-heng said that the firm is upbeat about long-term demand thanks demand from 5G and autonomous vehicles

By Lisa Wang  /  Staff reporter

Thu, Jun 20, 2019 - Page 11

Passive components maker Walsin Technology Corp (華新科) yesterday said that it would be cautious about the second half of this year if a US-China trade dispute remains unsolved.

Customers have placed more orders this quarter ahead of heavier tariffs imposed on a wider range of Chinese goods, Walsin chairman Chiao You-heng (焦佑衡) told Unique Satellite TV on the sidelines of a company's annual general meeting yesterday in Taoyuan.

The company’s factory utilization rate has fallen to between 50 percent and 60 percent after customer demand dwindled since the second half of last year, the Chinese-language China Times reported yesterday

Walsin would adjust equipment loading in accordance with customer demand, the newspaper said.

“Although the third quarter is usually a high season, we are monitoring whether the trade war will affect client demand during the second half,” the TV channel quoted Chiao as saying.

The company is still optimistic about long-term demand for passive components, driven by growing demand for 5G devices and autonomous vehicles, Chiao said.

The company plans for bigger capital expenditure this year and has no plan to markedly slow down capacity expansion, Unique Satellite TV reported.

However, the company might push back the delivery of new equipment by one or two quarters, Chiao said.

Walsin reported net profit of NT$19.7 billion (US$628.39 million) for last year, or earnings per share of NT$40.75.

Shareholders yesterday approved the distribution of a cash dividend of NT$16.3 per common share, representing a yield of 10.52 percent compared with the stock’s closing price of NT$155 in Taipei trading yesterday.