Leading industrial automaker Teco Electric and Machinery Co Ltd (東元電機) on Friday received shareholder approval to distribute a cash dividend of NT$1.35 this year, about 17 percent higher than the NT$1.15 dividend the company paid the previous year.
With Teco’s stock price closing at NT$28.75 on Friday, the proposed cash dividend represents a dividend yield of 4.7 percent, higher than the interest rates on fixed-term deposits offered by local banks.
At the company’s annual general meeting in Taoyuan’s Jhongli District (中壢) on Friday, Teco said net profit last year rose 42.8 percent year-on-year to NT$5.01 billion (US$168.94 billion), raising earnings per share to a record high of NT$2.38.
Photo courtesy of Teco Electric and Machinery Co
The company attributed the strong earnings to an annual revenue increase of 14.7 percent to NT$52.56 billion, as its major business units posted steady growth across the board.
Established in 1956 as an automaker, Teco also develops and designs infrastructure support solutions, automation systems and energy-efficient electrical products.
The company said underlying uncertainties would affect this year’s forecast, such as COVID-19 outbreaks and rising inflation, while China’s strict pandemic prevention measures are to have a significant impact globally.
The company saw net profit in the first quarter plunge 68.37 percent year-on-year to NT$348.44 million, sending earnings per share down to NT$0.17 from NT$0.53 a year earlier, while revenue rose 20.44 percent to NT$13.9 billion over the period.
Supply chain disruptions and logistics challenges are major headwinds this quarter, although order visibility remains clear in the short term, the company said.
However, the firm’s flexible operational strategy and diversified production locations should help it address macroeconomic risks, Teco chairwoman Sophia Chiu (邱純枝) said in a statement released after the meeting.
Teco aims to reduce carbon emissions by 50 percent in 10 years, Chiu said, adding that the company is maximizing the interests of shareholders by focusing on business opportunities related to smart manufacturing, smart energy and smart city solutions.
Teco said that it would continue to expand its original equipment manufacturing business to produce electric vehicle power systems, targeting growth of more than 60 percent from last year and more than 80 percent of the local market for electric bus power systems.
The company also hopes to enhance sales growth in energy-saving products and intelligent services via the continued development of high performance motor systems, waste heat recovery systems, remote inspection devices and other solutions, it said.
Teco expects to benefit from Taiwan’s renewable energy policy and is optimistic that the domestic market should have 1 gigawatts of energy storage demand every year after 2025, it said, adding that it has secured a 35 percent share of onshore substations for offshore wind power projects.
Teco said it aims to participate in Taiwan Power Co’s (Taipower, 台電) energy storage projects, along with more onshore and offshore wind power substation projects.
The company has received a contract for a turnkey project for Taipower’s energy storage facility in Taoyuan’s Longtan District (龍潭), it said.
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