Taiwan FamilyMart Co (全家便利商店) posted the highest net income in the company’s history last year, thanks to its strategy of store upgrades in Taiwan and reduced losses at its Chinese business, the company said.
FamilyMart, which operates 2,897 convenience stores in Taiwan, posted a net profit of NT$1.1 billion (US$36 million), or earnings per share of NT$4.91 last year, up 24.28 percent from net income of NT$881.14 million, or earnings per share of NT$3.95 per share, in 2012, the company said in a statement on Thursday.
The company’s board of directors approved a proposal to issue a cash dividend of NT$4.5 per share, higher than the cash dividend of NT$3.1 per share paid last year, a company filing to the stock exchange said.
RENOVATIONS
“The company’s efforts to renovate its outlets had a positive effect on sales and profitability last year,” the statement said.
The number of new-format FamilyMart outlets — which offer more seats with store sizes between 40 ping and 50 ping (132m2 to 165m2) — reached 1,476 as of the end of last year, accounting for more than half of its total stores, the statement said.
The move saw FamilyMart’s same-store revenue grow by 6 percent last year, helping the convenience store operator to increase its net income and offsetting rises in electricity bills and human resources costs, the statement said.
CHINESE BUSINESS
In addition, the company’s Chinese business improved last year after it shut some unprofitable stores, it added.
In the fourth quarter of last year, net income plunged 31 percent year-on-year to NT$246.33 million, or earnings per shares of NT$0.97, compared with a net profit of NT$354.74 million, or earnings per share of NT$1.04, in the same period of 2012, company statistics showed.
The quarterly net profit underperformed most analysts’ expectations, Yuanta Securities Investment Consulting (元大投顧) said.
Q4 INCOME
FamilyMart’s fourth-quarter net income last year was 10 percent lower than Yuanta Securities’ forecast and the market consensus, the brokerage said.
At an investors’ conference on Wednesday, FamilyMart — the nation’s second-largest convenience store operator — said it expected sales this year to grow by 7 percent, with net income to surge by a double-digit percentage, a Yuanta Securities report said.
FamilyMart attributed the expected growth to a rising contribution from its business operations in China, as well as revenue growth from high-margin products, such as ice cream, and its own-brand products.
AI BOOST: Although Taiwan’s reliance on Chinese rare earth elements is limited, it could face indirect impacts from supply issues and price volatility, an economist said DBS Bank Ltd (星展銀行) has sharply raised its forecast for Taiwan’s economic growth this year to 5.6 percent, citing stronger-than-expected exports and investment linked to artificial intelligence (AI), as it said that the current momentum could peak soon. The acceleration of the global AI race has fueled a surge in Taiwan’s AI-related capital spending and exports of information and communications technology (ICT) products, which have been key drivers of growth this year. “We have revised our GDP forecast for Taiwan upward to 5.6 percent from 4 percent, an upgrade that mainly reflects stronger-than-expected AI-related exports and investment in the third
Mercuries Life Insurance Co (三商美邦人壽) shares surged to a seven-month high this week after local media reported that E.Sun Financial Holding Co (玉山金控) had outbid CTBC Financial Holding Co (中信金控) in the financially strained insurer’s ongoing sale process. Shares of the mid-sized life insurer climbed 5.8 percent this week to NT$6.72, extending a nearly 18 percent rally over the past month, as investors bet on the likelihood of an impending takeover. The final round of bidding closed on Thursday, marking a critical step in the 32-year-old insurer’s search for a buyer after years of struggling to meet capital adequacy requirements. Local media reports
TECHNOLOGICAL RIVALRY: The artificial intelligence chip competition among multiple players would likely intensify over the next two years, a Quanta official said Quanta Computer Inc (廣達), which makes servers and laptops on a contract basis, yesterday said its shipments of artificial intelligence (AI) servers powered by Nvidia Corp’s GB300 chips have increased steadily since last month, should surpass those of the GB200 models this quarter. The production of GB300 servers has gone much more smoothly than that of the GB200, with shipments projected to increase sharply next month, Quanta executive vice president Mike Yang (楊麒令) said on the sidelines of a technology forum in Taipei. While orders for GB200 servers gradually decrease, the production transition between the two server models has been
ASE Technology Holding Co (日月光投控), the world’s largest integrated circuit (IC) packaging and testing supplier, yesterday announced a strategic collaboration with Analog Devices Inc (ADI), coupled with the signing of a binding memorandum of understanding. Under the agreement, ASE intends to purchase 100 percent shares of Analog Devices Sdn Bhd and acquire its manufacturing facility in Penang, Malaysia, a press release showed. The ADI Penang facility is located in the prime industrial hub of Bayan Lepas, with an area of over 680,000 square feet, it said. In addition, the two sides intend to enter into a long-term supply agreement for ASE to
RSS