Cash-strapped LCD panel maker Chunghwa Picture Tubes Ltd (CPT, 中華映管) yesterday said it has laid off 63 people as it faces mounting pressure to repay debts.
The development came after CPT two weeks ago shut down factories and applied for restructuring due to imminent debt distress.
The company has not made any significant strides in negotiating with its creditors to pay back bank loans totaling NT$12.7 billion (US$412.2 million).
“The company eliminated 63 jobs as we continue feeling a financial squeeze. It has to cut operating expenses to cope with financial difficulties,” a company public relations official said by telephone. “Employees not directly linked to the company’s operations were affected first.”
The layoffs were also based on employees’ annual performance reviews, the official said, adding that affected workers were from various areas, including procurement and project management.
The official declined to comment on speculation that CPT plans to cut more jobs after the Lunar New Year holiday in February, saying: “We have not yet received such information.”
CPT, a major mobile phone flat panel supplier, posted losses of NT$1.28 billion for last month, reversing net profit of NT$1.12 billion in the same period last year, a company filing with the Taiwan Stock Exchange on Saturday said.
As of the end of September, CPT had incurred losses of NT$63.9 billion.
The company on Saturday restored operations at its two fabs in Taoyuan after gas supplier Linde LienHwa Industrial Gases Co (聯華林德) resumed supply.
CPT’s restructuring has caused a ripple effect.
Shares of United Integrated Services Co Ltd (漢唐), which helped build clean rooms for CPT, yesterday tumbled 3.84 percent in early trading, as the panel maker defaulted on its payments.
United Integrated Services had spent NT$49.88 million on the rooms, it said in a filing with the Taiwan Stock Exchange on Monday.
The defaulted payment accounted for 0.24 percent of the company’s consolidated assets, it added.
United Integrated Services would seek to recoup the payment in any way possible to minimize the impact and would consider taking legal action if the situation worsens, the filing said.
Shares of United Integrated Services closed down 2.75 percent at NT$88.5 after regaining some momentum.
However, shares of CPT dropped 9.38 percent to NT$0.58.
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