Metal-casing maker Catcher Technology Co (可成科技) yesterday said a partial shutdown of its factories in Suzhou, Jiangsu Province, China, over environmental protection disputes could cause a 20 percent fall in shipments this month.
If the partial closure at these factories continues, shipments could drop by as much as 40 percent next month, Catcher chairman Allen Horng (洪水樹) said at a press conference at the Taiwan Stock Exchange.
Shares of Catcher, which makes metal casings for Apple Inc’s MacBook Air and HTC Corp’s (宏達電) smartphones, dropped by their limit yesterday to close at NT$175 on the stock exchange after the company issued a filing to the Taiwan stock exchange on Sunday night about its factory closures.
Catcher said in the filing that it was forced to partially shut down its production lines in Suzhou over the weekend after local authorities ordered the company to improve its manufacturing process in light of residents’ complaints about strange odors emitted by its factories.
Horng told reporters that the affected production lines were mainly involved in coating and computer numerical control (CNC) works.
He said the company planned to complete the improvements by the end of this month, but could not say when the affected production lines would resume operations because that would depend on the result of safety inspections conducted by the Suzhou authorities.
“If we cannot pass the review by the end of October, shipments to our customers will inevitably be affected,” local cable TV network UBN quoted Horng as saying. “Currently, we still have some casing inventories and semi-processed products. We estimate the closure will affect our shipments by nearly 20 percent this month and by about 40 percent next month in a worst-case scenario.”
Thanks to increasingly popular smartphones and notebook computers, Catcher reported record sales of NT$3.82 billion (US$126.24 million) last month, up 4.6 percent month-on-month and 89.8 percent higher year-on-year.
In the first nine months, the company’s accumulated sales increased 83 percent from a year earlier to NT$26.78 billion, which has helped boost the stock to rise 74.07 percent so far this year, outperforming a decline of 17.99 percent in the benchmark TAIEX over the same period, stock exchange data showed.
The Chinese-language Wealth Magazine first reported last week that Catcher was ordered to shut down part of its Suzhou facilities last month because of complaints by residents.
The report also said that about 1,600 new CNC machines were left idle in the production sites pending formal approval of local authorities’ environmental tests.
Catcher flatly denied the magazine’s report in a stock exchange filing on Thursday, saying its Suzhou factories were closed for China’s Golden Week holiday, not because of environmental protection disputes.
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