Inventec Corp (英業達), which assembles smartphones for Chinese firm Xiaomi Corp (小米), yesterday reported an annual decline of 21.57 percent in net income for last year, due to volatile foreign currency exchange rates.
Net profit last year plunged about 22 percent to NT$5.56 billion (US$170.94 million), or earnings per share of NT$1.55, from the previous year’s NT$7.09 billion, or NT$1.98 per share.
“Non-operating items were the hardest area for Inventec to control. Harsh depreciation of the yuan against the US dollar in August last year and the volatility of the New Taiwan dollar throughout the year affected the company’s earnings,” Inventec chief financial officer Yu Chin-pao (游進寶) told an investors’ conference in Taipei.
The contract electronics maker booked foreign exchange losses of NT$669 million last year, compared with a foreign exchange gain of NT$870 million a year earlier, Yu said.
Gross margin improved by 0.1 percentage points to 5.5 percent from a year earlier, while its operating margin dropped by 0.2 percentage points annually to 1.4 percent last year, according to the company.
Last quarter, Inventec’s net income plunged 80 percent annually and 80 percent quarterly to NT$499 million. Earnings per share were NT$0.28, compared with NT$0.53 per share over the same period a year earlier.
The quarterly earnings per share represented the lowest quarterly performance in the past 12 quarters, according to a company filing with the Taiwan Stock Exchange.
“The earnings result for last quarter was mainly dragged down by foreign-exchange losses of NT$487 million,” Yu said.
Yu said he is confident that Inventec’s core business, such as commercial PCs, handheld devices and servers would maintain stable growth this year from last year, adding that volatile currency exchanges would likely continue to affect Inventec.
“We will do our best to avoid risks, but it is still hard to control the currency changes,” he said.
Yu said he expects Inventec’s annual revenue to climb by a single-digit percentage this year from last year’s NT$395.47 billion.
David Ho (何代水), chief executive officer of Inventec’s handset subsidiary, Inventec Appliance Corp (英華達), said he is optimistic that the company would ship a total of 70 million handsets this year, up 40 percent from last year’s more than 50 million units.
“The outlook for this year is good. [Inventec Appliance] has more than 20 new clients, with many new businesses this year to counter the uncertainty of the global economy,” Ho said.
He said that, in addition to smartphone business, he expects wearable and acoustic segments to continue to grow this year in terms of shipments and revenue.
Also yesterday, Inventec announced a strategic partnership with Advantech Co Ltd (研華), the nation’s leading industrial computer maker, to jointly create a new company to produce manufacturing industrial wireless handheld devices.
The new company, AI Mobile Co (英研工業移動股份有限公司), is to have paid-in capital of NT$1 billion. Inventec is to own a 55 percent share of the firm and Advantech 45 percent, Yu said.
He said Inventec’s expertise is in material purchase and producing wireless handheld devices, while Advantech focuses on brand establishment and sales channels.
Yu said AI Mobile plans to recruit between 30 and 50 research and development experts before the end of this year.
The company is expected to become profitable by next year, he added.
STEPPING UP: The firm has also asked employees to work in split shifts from this week and to halt all but essential overseas business travel from next month Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has implemented a remote work policy for employees not on production lines in an attempt to curb the spread of COVID-19, the world’s largest contract chipmaker said yesterday. This is the first time in the Hsinchu-based company’s history that it has launched a large-scale remote work policy, joining global technology companies, such as Apple Inc and Google, that encourage employees to work from home. The chipmaker has also asked employees to work in split shifts from this week, it said. As the number of virus infections continues to climb worldwide, TSMC has urged employees to halt unnecessary
Manufacturers are on a mission to produce desperately needed medical ventilators for the COVID-19 pandemic, even if it means converting assembly lines now making auto parts. Along with a shortage of masks and gloves, the spread of COVID-19 to almost every corner of the globe has highlighted a great need for specialized machines that help keep severely afflicted patients alive. “As the global pandemic evolves, there is unprecedented demand for medical equipment, including ventilators,” GE Healthcare chief executive officer Kieran Murphy said. The group has hired more workers and is making ventilators around the clock. Swedish group Getinge AB is also ramping up output
Facing the rapidly evolving global COVID-19 pandemic, Citibank Taiwan Ltd (台灣花旗) has proactively taken precautionary measures. “The health and safety of our colleagues and their families, as well as our clients and the communities we serve, are of the utmost importance. We continue to take proactive measures to preserve their well-being while we maintain our ability to serve our clients,” Citibank Taiwan chairman Paulus Mok (莫兆鴻) said in a statement yesterday. “We have local and regional contingency plans in place, and we have well-established business continuity plans for the firm. We are monitoring the situation closely, adjusting our operations accordingly,
GoShare, an electric scooter sharing service provider with Gogoro Inc (睿能創意), plans to expand to Tainan next quarter in a strategic alliance with Aeon Motor Co (宏佳騰). The company currently offers its services in Taipei and Taoyuan. “Tainan is very popular among tourists. The city receives an average of 22.94 million tourists every year,” GoShare head Henry Chiang (姜家煒) told a news conference yesterday in Taipei, citing Tourism Bureau statistics. “Besides, the city has a long history of riding scooters,” he said. Each household owns an average of 2.5 scooters, he added. “Expanding presence” is one of four strategies GoShare is adopting for this