King Yuan Electronics Co (京元電子) has purchased facilities and equipment from Xuan Tong System Integration Co (玄通系統工程) for NT$1.05 billion (US$32.9 million) as the company seeks to expand its IC testing capacity, it said on Friday.
The company has also spent just less than NT$500 million to acquire 15 land parcels in Miaoli County’s Jhunan Township (竹南) totaling 22,372.06 square meters for future business needs, it said in a filing with the Taiwan Stock Exchange.
The deals come as King Yuan is expanding its artificial intelligence (AI) chip testing capacity at its plant in Miaoli’s Tongluo Township (銅鑼) to meet the needs of Nvidia Corp and other customers.
Photo courtesy of the Military News Agency via CNA
Founded in 1987, King Yuan provides front-end wafer testing and back-end IC product testing services, as well as burn-in and packaging services.
The company operates plants in Tongluo and Jhunan townships in Miaoli County and Suzhou, China.
King Yuan’s specialty is in providing customized test solutions for customers, which include Nvidia, MediaTek Inc (聯發科), Broadcom Inc and Marvell Technology Group Ltd.
For this reason, the company uses a self-made tester to test mixed-signal, power management, radio frequency and other chip modules, and has further expanded to high-speed test modules, such as MEMS sensors and CMOS modules.
The company also said on Friday that it has raised its Chinese subsidiary King Long Technology (Suzhou) Ltd’s (京隆科技) capital expenditure to 1.392 billion yuan from 738 million yuan (US$196.2 million from US$104 million), an increase of 88.5 percent, as it prepares for operational and capacity expansion needs.
The move follows the company’s decision to increase its capital expenditure in Taiwan this year to NT$13.8 billion from NT$12.3 billion, of which 40 percent would be used to construct cleanrooms and plants in Tongluo and Jhunan, while the remaining 60 percent would be used for testing equipment procurement and machine upgrades.
In the first half of this year, King Yuan reported revenue of NT$12.52 billion, up 9.73 percent from NT$11.41 billion in the same period a year earlier, while net profit rose 19.69 percent to NT$3.27 billion from NT$2.73 billion, with earnings per share of NT$2.68.
The company expects revenue to grow 5 percent to 7 percent this quarter from NT$6.54 billion last quarter.
It also expects an increase of at least 10 percent in full-year revenue this year given stronger-than-expected AI demand, it said.
Gross margin this year is also expected to continue expanding amid rising factory use after posting 34.18 percent in the first half of this year, it added.
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