Uni-President Enterprises Corp (統一企業), the nation’s largest food-and-beverage conglomerate, yesterday reported that net profit for the first three months of the year increased 14.3 percent year-on-year and 132.8 percent quarter-on-quarter.
Analysts said the increase in profit was mainly due to higher-than-expected non-operating income as the company’s operating profit was down 4 percent from a year earlier, affected by the declining income at its Chinese subsidiary, Uni-President China Holdings Ltd (UPC, 統一中國控股).
The Greater Tainan-based company, whose President Chain Store Corp (PCSC, 統一超商), Ton Yi Industrial Corp (統一實業) and Uni-President China are its major earnings sources, posted a net profit of NT$4.16 billion (US$137.7 million), or NT$0.81 per share in the first quarter, the company’s quarterly financial report showed.
The results were 26.4 percent higher than market consensus estimates of a net profit of NT$3.29 billion, or NT$0.64 per share, and 35 percent above UBS Securities’ forecasts of NT$3.08 billion or NT$0.6 per share.
The earnings contribution from Ton Yi Industrial increased by 9 percent on increased capacities, while that from President Chain expanded by 47 percent on the back of strong growth from its subsidiaries, UBS analyst Ally Chen (陳玟瑾) said.
That increase helped offset an earnings decline at the group’s drugmaking subsidiary, ScinoPharm Taiwan Ltd (台灣神隆), but Uni-President China’s 25 percent annual decline in net profit to 237 million yuan (US$38.05 million) last quarter may indicate headwinds for the company’s Chinese food-and-beverage business this year, she said.
“The fierce competition in the noodle and beverage sector in China has compressed Uni-President Enterprises’ profitability. The visibility of competition easing is still low,” Chen said in a research report.
The company’s January-to-March revenue totaled NT$108.63 billion, rising 11.4 percent from the previous quarter and 3.8 percent higher than the same period last year, with gross margin of 31.4 percent and operating margin of 5.1 percent.
“Uni-President Enterprises continues to deliver solid earnings growth, although there is still bad sentiment about UPC. This could be offset by strong growth from PCSC,” Taipei-based HSBC Securities analyst Abel Lee (李忠翰) said in his report yesterday.
President Chain, the operator of 7-Eleven convenience stores, remained the key earnings contributor to the parent company in this past quarter, reporting a net profit of NT$2.97 billion, or NT$2.86 per share, up 102 percent quarter-on-quarter and 46.9 percent year-on-year.
HSBC has revised upward its earnings forecast for Uni-President Enterprises by 7.4 percent to NT$2.68 per share this year to take into account the company’s first-quarter results.
Last year, the company reported earnings of NT$2.48 per share, up 29.3 percent from 2012.
Uni-President Enterprises shares closed 0.4 percent up at NT$50.8 in Taipei trading.
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).
RSS