Shares in solar cell maker E-Ton Solar Tech Co (益通) fell sharply yesterday after the company reported a massive net loss for the first half of this year, dealers said.
Trading in the over-the-counter (OTC) market listed E-Ton fell 6.94 percent to NT$45.6 billion (US$1.42 billion) with 772,000 shares changing hands, while the OTC index closed down 0.83 percent at 137.84 points.
E-Ton posted NT$3.01 billion in net losses in the first half of this year after a NT$2.34 billion net loss last year.
“The company has incurred net losses for the sixth consecutive quarter, largely reflecting its unprofitable subsidiary in the United States, GIH,” TLG Asset Management (台壽保投信) analyst Arch Shih (施博元) said yesterday.
E-Ton acquired US-based ADEMA Technologies in 2007 and combined the newly acquired business with one of its units — Gloria Solar Ltd — to form Gloria Solar International Holding Inc (GIH), which produces upstream solar products, including monocrystalline ingots and photovoltaic modules.
Shih said E-Ton had previously wanted to extend into the business of solar cell material production as part of a broader strategy for vertical business integration through the acquisition of ADEMA.
“ADEMA had a lot of unprofitable intangible assets, however and E-Ton has had to incorporate the losses,” Shih said.
“A global financial crisis in 2008 made the situation even worse. E-Ton needed more provisions to cover the losses. That’s why the market was stunned by its massive losses reported for the first half of the year,” Shih said.
MasterLink Securities analyst Tom Tang said that it had proved harder than expected for E-Ton, which was smaller than ADEMA in terms of capitalization, to run the acquired assets.
“It was like a funny scenario with a small child driving a big car,” Tang said.
In the first half of this year, E-Ton’s gross margin stood at only 6.48 percent, much lower than the average of about 14 percent in the solar cell industry.
Among E-Ton’s rivals, Motech Industries Inc (茂迪) reported a gross margin of 16.69 percent and Solartech Energy Corp (昇陽光電) registered 17.44 percent for its gross margin.
“The weak gross margin reflected E-Ton’s low production capacity utilization on falling orders after a major management reshuffle last year had an impact on the company’s operations,” Shih said.
The reshuffle came after several senior executives chose to resign following a boardroom disagreement over E-Ton’s management of the US subsidiary, Shih said.
“The stock is very likely to fall further amid uncertainty over its outlook,” Shih said. “Keep a distance from it, please.”
BIG BUCKS: Chairman Wei is expected to receive NT$34.12 million on a proposed NT$5 cash dividend plan, while the National Development Fund would get NT$8.27 billion Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday announced that its board of directors approved US$15.25 billion in capital appropriations for long-term expansion to meet growing demand. The funds are to be used for installing advanced technology and packaging capacity, expanding mature and specialty technology, and constructing fabs with facility systems, TSMC said in a statement. The board also approved a proposal to distribute a NT$5 cash dividend per share, based on first-quarter earnings per share of NT$13.94, it said. That surpasses the NT$4.50 dividend for the fourth quarter of last year. TSMC has said that while it is eager
‘IMMENSE SWAY’: The top 50 companies, based on market cap, shape everything from technology to consumer trends, advisory firm Visual Capitalist said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) was ranked the 10th-most valuable company globally this year, market information advisory firm Visual Capitalist said. TSMC sat on a market cap of about US$915 billion as of Monday last week, making it the 10th-most valuable company in the world and No. 1 in Asia, the publisher said in its “50 Most Valuable Companies in the World” list. Visual Capitalist described TSMC as the world’s largest dedicated semiconductor foundry operator that rolls out chips for major tech names such as US consumer electronics brand Apple Inc, and artificial intelligence (AI) chip designers Nvidia Corp and Advanced
Saudi Arabian Oil Co (Aramco), the Saudi state-owned oil giant, yesterday posted first-quarter profits of US$26 billion, down 4.6 percent from the prior year as falling global oil prices undermine the kingdom’s multitrillion-dollar development plans. Aramco had revenues of US$108.1 billion over the quarter, the company reported in a filing on Riyadh’s Tadawul stock exchange. The company saw US$107.2 billion in revenues and profits of US$27.2 billion for the same period last year. Saudi Arabia has promised to invest US$600 billion in the US over the course of US President Donald Trump’s second term. Trump, who is set to touch
SKEPTICAL: An economist said it is possible US and Chinese officials would walk away from the meeting saying talks were productive, without reducing tariffs at all US President Donald Trump hailed a “total reset” in US-China trade relations, ahead of a second day of talks yesterday between top officials from Washington and Beijing aimed at de-escalating trade tensions sparked by his aggressive tariff rollout. In a Truth Social post early yesterday, Trump praised the “very good” discussions and deemed them “a total reset negotiated in a friendly, but constructive, manner.” The second day of closed-door meetings between US Secretary of the Treasury Scott Bessent, US Trade Representative Jamieson Greer and Chinese Vice Premier He Lifeng (何立峰) were due to restart yesterday morning, said a person familiar
RSS