Silicon wafer supplier Formosa Sumco Technology Corp’s (台勝科) board of directors yesterday approved a plan to distribute a bigger cash dividend of NT$7.3 per common share this year, due to its solid earnings performance last year.
Formosa Sumo shareholders received a cash dividend of NT$2.2 per share last year.
Net income last year more than tripled to NT$4.82 billion (US$157.55 million) from NT$1.41 billion in 2021 — the company’ best performance since 2018. That translated into earnings per share of NT$12.43, an increase from NT$3.64 the previous year.
Photo: Ann Wang, Reuters
The proposed cash dividend represents a payout ratio of 58.73 percent. It also comes with a dividend yield of 4.69 percent based on the company’s closing share price of NT$155.5 yesterday.
The proposal is subject to shareholders’ approval at an annual general meeting on June 15 in Taipei, the company said.
Gross margin last year expanded to 37.7 percent from 20.98 percent in 2021 — the highest it has been in four years, Formosa Sumco said in a filing with the Taiwan Stock Exchange yesterday.
Gross margin dropped to 36.83 percent last quarter from 38.59 percent in the third quarter of last year.
During the fourth quarter of last year, net profit contracted more than 35 percent to NT$995.49 million from NT$1.54 billion in the third quarter, due to demand for 12-inch wafers being weak as customers had entered an inventory correction cycle, Formosa Sumco said.
The company told investors in November last year that its 12-inch and 8-inch fabs would be fully utilized in the fourth quarter, but it would adjust its product lineup after major customers signaled a slowdown in wafer demand amid rising inventory and sagging end-market demand for notebook computers and smartphones.
Last year as a whole, the company saw its revenue surge 34.67 percent from NT$12.17 billion in 2021 to an all-time high of NT$16.39 billion.
During the first two months of this year, the company accumulated NT$2.4 billion in revenue, down 1.2 percent from NT$2.43 billion during the same period last year.
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The company plans to release financial details and give its business outlook during a virtual investors’ conference on Tuesday next week.
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