Catcher Technology Co (可成), the nation’s leading supplier of light metal casings and enclosures for mobile devices, last week reported weaker-than-expected financial results for last year, as well as falling sales in the first two months of this year.
Net income dropped 59.7 percent year-on-year to NT$11.27 billion (US$373.06 million), or earnings per share of NT$14.63, after revenue decreased 4 percent to NT$91.63 billion, the company said in a regulatory filing on Tuesday last week.
Gross margin of 24.3 percent and operating margin of 15.4 percent were both lower than a year earlier due to sliding capacity utilization and reduced prices.
Cumulative revenue in the first two months of this year was NT$9.93 billion, up 18.8 percent from NT$20.41 billion in the same period last year, but last month’s revenue plunged 41.3 percent year-on-year and about 74 percent month-on-month to NT$2.02 billion, the lowest in nine years, company data showed.
Catcher said that its revenue performance was due mainly to the COVID-19 outbreak, as disease-prevention policies hampered its operations and logistics.
JPMorgan Securities (Taiwan) Ltd (摩根大通證券) said that Catcher’s revenue for this month should recover from the previous month thanks to an improving rate of workers returning to production lines at its plants in China.
However, it might still be shy of market consensus estimates by a “big shortfall,” JPMorgan said in a note on Wednesday, without elaborating.
Yuanta Securities Investment Consulting Co (元大投顧) said the company’s lower production scale amid the COVID-19 pandemic could lead to a lower-than-expected gross margin this quarter.
“However, we believe its low gross margin from last year should recover in 2020, with likely better-than-expected iPhone 11 sales, while its high confidence in its business relationships with major clients will enable it to see iPhone shipment growth,” Yuanta said in a note to clients on Tuesday.
Meanwhile, China-based Luxshare Precision Industry Co (立訊精密) is rumored to be expanding its presence in Apple Inc’s iPhone assembly business by as early as next year, with Catcher likely a major partner for metal casing and frame manufacturing, Chinese-language media reported.
Yuanta said that Catcher’s position in Apple’s casing supply chain should remain stable if Luxshare makes the move.
However, JPMorgan said it would not necessarily be a positive development for Catcher, due to potential regulatory approval headwinds and downside risks for market share dynamics.
Catcher shares fell 19.62 percent for the whole of last week and have dropped 16.08 percent so far this year.
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
Greek tourism student Katerina quit within a month of starting work at a five-star hotel in Halkidiki, one of the country’s top destinations, because she said conditions were so dire. Beyond the bad pay, the 22-year-old said that her working and living conditions were “miserable and unacceptable.” Millions holiday in Greece every year, but its vital tourism industry is finding it harder and harder to recruit Greeks to look after them. “I was asked to work in any department of the hotel where there was a need, from service to cleaning,” said Katerina, a tourism and marketing student, who would
i Gasoline and diesel prices at fuel stations are this week to rise NT$0.1 per liter, as tensions in the Middle East pushed crude oil prices higher last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week rose for the third consecutive week due to an escalating conflict between Israel and Iran, as the market is concerned that the situation in the Middle East might affect crude oil supply, CPC and Formosa said in separate statements. Front-month Brent crude oil futures — the international oil benchmark — rose 3.75 percent to settle at US$77.01