2020/02/18
Coretronic Corporation Announces Fourth Quarter 2019 Results
Hsinchu, Taiwan – Coretronic Corporation (5371.TW) today announced its financial results for the fourth quarter of 2019. For the fourth quarter ended Dec. 31, 2019, Coretronic posted consolidated sales revenue of NT$13,084 million, up 0.7% QoQ and drop 9% YoY. Consolidated gross margin for the quarter was 18.2%, a decrease of 0.3% as compared with 18.5% in the previous quarter and drop by 1.7% over the same period last year, resulting from unfavorable product mix and exchange rate. Operating income was NT$405 million, decrease 18% QoQ and drop 45% YoY, respectively. Net income was NT$358 million, representing a 25% decrease QoQ and a 49% drop YoY. Net income attributable to equity holders of the parent company was NT$391 million, decrease 17% QoQ and drop 44% YoY, respectively. The basic EPS* for the fourth quarter were NT$0.9.
For the fiscal year of 2019, Coretronic reported consolidated sales revenue of NT$48,711 million, drop 12.5% YoY. Consolidated gross margin was 18.1%, decreased by 0.5% compared with 18.6% in 2018, resulting from poor efficiency and unfavorable exchange rate. Operating income totaled NT$1,201 million, drop 48% YoY. Net income was reported at NT$1,158 million, drop 46% YoY. Net income attributable to equity holders of the parent company was NT$1,153 million, a 43% decrease YoY. The basic EPS* for 2019 was NT$2.65.
“Due to customers pre-stocking in advance in third quarter in response to the tariffs increased due to trade war, the overall shipment of Energy Saving Business Group was 10.73 million units in 4Q19, representing 11% QoQ decrease, and the overall sales revenue was NT$6,220 million, drop 7% QoQ. For the fiscal year of 2019, the overall shipment was 41.75 million units, decrease 12% YoY, and the sales revenue amounted to NT$23,969 million, slightly drop 3% YoY, thanks to more high-end and large-sized TV LCM and PID products from both of EMS and ODM businesses enhanced the ASP. ” said Ms. Sarah Lin, President of Coretronic. “Regarding 1Q20, affected by the traditional slow-season and delayed resumption of work caused by the COVID-19, overall shipments can reach about 50% of the same period last year, and we will active and flexible scheduling to accelerate recovery capacity.” Look into the future, Sarah indicate that grasping key components and maintain new technology leadership are core strategies. We will bet more resources on higher-tech product lines such as PID, automotive, industrial and medical to head-on the competition, while provide customized, system integration supporting solutions, continue to expand the customer base of China and other system applications customers. With intelligent manufacturing to consolidate economies of scale and maintain the flexibility of business models and strategic cooperation to pursue higher profits and value.
For 4Q19, the shipment of Visual Solutions products was 304K units, with 19% QoQ increase, while the sales revenue was NT$4,172 million, representing an 14% QoQ up, benefited from the shipment growth of embedded precision projection solutions and high-end large venue products. For the fiscal year of 2019, the shipment was 954K units and the sales revenue was NT$14,475 million, drop 27% and 23% YoY respectively. “In response to 2019 operating situation, Mr. SY Chen, President of Coretronic pointed out that it was mainly due to the rapid decay in lamp projectors, the overall economic slowdown dragged down market demand, and further delayed the launch of new products. At the same time, it is facing the impact of factors such as price reduction competition for large-size flat panel displays. Looking to the future, SY pointed out that due to COVID-19, 1H20 shipment is expecting to decline. However, the demand from this year’s sport events will recover the sales in 2020. “The strategy direction of Visual Solutions products will be upgrades existing businesses and discover new application gaps in the market, while speed up Tainan factory II production schedule, introduce intelligent platforms ASAP, continue to enhance the overall competitiveness in terms of technology, manufacturing an integration to maintain competitive advantage, grasp key component technologies, provide application-oriented complete display solutions to meet the needs of more diverse visual solutions products in different scenarios and industries, and gradually increase the operating growth momentum.”, said SY Chen.
Regarding the impact from COVID-19, Coretronic has adopt rigorous epidemic prevention and response measures. We has carried out meticulous epidemic prevention plans for the Group's factories and offices, including inventory of epidemic prevention materials, health education, employee health management and travel control since the Chinese Lunar New Year, hoping to minimize the impact of the outbreak on operations. In response to the recovery of capacity, the production lines of the Energy Saving Business Group in Suzhou, Wujiang, Guangzhou, Ningbo and other places in China have resumed work last week. Some of the production lines in Suzhou and Fuqing continued to operating during the Lunar New Year to meet customer demand actually. The production line of Visual Solutions Business Group is located in Kunshan, it has resumed work last Friday. The Tainan factory I will also provide a small amount of capacity. Currently, the capacity recovery and operation development of each plant remain depends on the manpower, supplier and customer resumption, and whether the epidemic situation has been further controlled. Coretronic will continue to closely monitor and actively respond the overall situation to increase the production capacity ASAP and meet customer demand.
Looking into 2020 development strategy, the company point out that based on existing two major business groups, Coretronic will move forward to the advanced technologies area such as "image recognition, AI and cloud premium service" and aim to enhance the overall operating performance of Coretronic Group.
* Basic EPS was calculated based on the total weighted average outstanding shares of the balance sheet dated (434m shares).
For the fiscal year of 2019, Coretronic reported consolidated sales revenue of NT$48,711 million, drop 12.5% YoY. Consolidated gross margin was 18.1%, decreased by 0.5% compared with 18.6% in 2018, resulting from poor efficiency and unfavorable exchange rate. Operating income totaled NT$1,201 million, drop 48% YoY. Net income was reported at NT$1,158 million, drop 46% YoY. Net income attributable to equity holders of the parent company was NT$1,153 million, a 43% decrease YoY. The basic EPS* for 2019 was NT$2.65.
“Due to customers pre-stocking in advance in third quarter in response to the tariffs increased due to trade war, the overall shipment of Energy Saving Business Group was 10.73 million units in 4Q19, representing 11% QoQ decrease, and the overall sales revenue was NT$6,220 million, drop 7% QoQ. For the fiscal year of 2019, the overall shipment was 41.75 million units, decrease 12% YoY, and the sales revenue amounted to NT$23,969 million, slightly drop 3% YoY, thanks to more high-end and large-sized TV LCM and PID products from both of EMS and ODM businesses enhanced the ASP. ” said Ms. Sarah Lin, President of Coretronic. “Regarding 1Q20, affected by the traditional slow-season and delayed resumption of work caused by the COVID-19, overall shipments can reach about 50% of the same period last year, and we will active and flexible scheduling to accelerate recovery capacity.” Look into the future, Sarah indicate that grasping key components and maintain new technology leadership are core strategies. We will bet more resources on higher-tech product lines such as PID, automotive, industrial and medical to head-on the competition, while provide customized, system integration supporting solutions, continue to expand the customer base of China and other system applications customers. With intelligent manufacturing to consolidate economies of scale and maintain the flexibility of business models and strategic cooperation to pursue higher profits and value.
For 4Q19, the shipment of Visual Solutions products was 304K units, with 19% QoQ increase, while the sales revenue was NT$4,172 million, representing an 14% QoQ up, benefited from the shipment growth of embedded precision projection solutions and high-end large venue products. For the fiscal year of 2019, the shipment was 954K units and the sales revenue was NT$14,475 million, drop 27% and 23% YoY respectively. “In response to 2019 operating situation, Mr. SY Chen, President of Coretronic pointed out that it was mainly due to the rapid decay in lamp projectors, the overall economic slowdown dragged down market demand, and further delayed the launch of new products. At the same time, it is facing the impact of factors such as price reduction competition for large-size flat panel displays. Looking to the future, SY pointed out that due to COVID-19, 1H20 shipment is expecting to decline. However, the demand from this year’s sport events will recover the sales in 2020. “The strategy direction of Visual Solutions products will be upgrades existing businesses and discover new application gaps in the market, while speed up Tainan factory II production schedule, introduce intelligent platforms ASAP, continue to enhance the overall competitiveness in terms of technology, manufacturing an integration to maintain competitive advantage, grasp key component technologies, provide application-oriented complete display solutions to meet the needs of more diverse visual solutions products in different scenarios and industries, and gradually increase the operating growth momentum.”, said SY Chen.
Regarding the impact from COVID-19, Coretronic has adopt rigorous epidemic prevention and response measures. We has carried out meticulous epidemic prevention plans for the Group's factories and offices, including inventory of epidemic prevention materials, health education, employee health management and travel control since the Chinese Lunar New Year, hoping to minimize the impact of the outbreak on operations. In response to the recovery of capacity, the production lines of the Energy Saving Business Group in Suzhou, Wujiang, Guangzhou, Ningbo and other places in China have resumed work last week. Some of the production lines in Suzhou and Fuqing continued to operating during the Lunar New Year to meet customer demand actually. The production line of Visual Solutions Business Group is located in Kunshan, it has resumed work last Friday. The Tainan factory I will also provide a small amount of capacity. Currently, the capacity recovery and operation development of each plant remain depends on the manpower, supplier and customer resumption, and whether the epidemic situation has been further controlled. Coretronic will continue to closely monitor and actively respond the overall situation to increase the production capacity ASAP and meet customer demand.
Looking into 2020 development strategy, the company point out that based on existing two major business groups, Coretronic will move forward to the advanced technologies area such as "image recognition, AI and cloud premium service" and aim to enhance the overall operating performance of Coretronic Group.
* Basic EPS was calculated based on the total weighted average outstanding shares of the balance sheet dated (434m shares).
