Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday raised this year’s capital expenditure to a record US$30 billion, as demand for advanced chips used in high-performance-computing (HPC) applications is stronger than last quarter. The figure surpasses the chipmaker’s allocation in January of US$25 billion to US$28 billion. The investment is part of a three-year US$100 billion capital expansion plan that TSMC unveiled earlier this month. “As we enter a period of higher growth, underpinned by the multiple years of structural mega-trends of 5G-related and HPC applications, we believe a higher level of capital investment is necessary to capture the future growth opportunities,” TSMC vice president and chief financial officer Wendell Huang (黃仁昭) told a conference call with investors. About 80 percent of the capital budget is to be spent on the buildup of advanced technologies — including 3, 5 and 7-nanometer technologies — while about 10 percent would be for less-advanced technologies, Huang said. “We are seeing stronger engagement with more customers on 5-nanometer and 3-nanometer technologies. The engagement is so strong that we need to really prepare the capacity for it — that is the main reason,” TSMC chief executive officer C.C. Wei (魏哲家) said. Nearly all of the company’s customers build higher levels of inventory as geopolitical tensions persist, while the COVID-19 pandemic still poses uncertainty to chip supply, Wei said. Asked whether overbooking is a factor behind the supply-demand imbalance, Wei said that the chipmaker “cannot rule out the possibility of inventory correction, or overbooking. But, actually, we expect structural growth to continue.” TSMC also sees increasing demand for production outsourcing from customers who make some of their chips in-house, such as Intel Corp. Overall, chip supply constraints are to continue through this year and might go into next year, Wei said. However, an auto chip shortage would “greatly” improve next quarter, as TSMC has allocated wafer
INFRASTRUCTURE EFFECT: China Steel said that mills worldwide have seen steady demand, thanks to trillions of dollars of infrastructure spending in the US and China
China Steel Corp (中鋼), the nation’s biggest steelmaker, yesterday said that it is planning another price hike for next month — the 11th consecutive month of increases — with the price of steel products for domestic delivery rising 8.1 percent on average. The price of hot-rolled steel plates would increase NT$2,000 (US$70.47) per tonne, while the price of hot-rolled steel bars and wire rods would increase NT$2,500 per tonne, the company said. The price of hot-rolled carbon steel would increase NT$2,000 per tonne; cold-rolled sheets and coils would increase NT$2,300 per tonne; and hot-dipped, zinc-galvanized sheets would increase NT$2,500 per tonne, it said, adding that the price of electrical sheets would increase NT$500 per tonne for low-to-medium-grade products and NT$1,000 per tonne for high-grade products. The planned price adjustments are smaller than the hikes elsewhere in the world and reflect its “moderate and steady” price policy, the state-owned company said. Domestic steel prices are as much as US$100 to US$200 per tonne lower than international prices, with some mainstay products, such as rerolling quality steel, “possibly the cheapest of all the international markets,” the company said. Steel prices in the US and Europe keep setting new records, with the price of European hot-rolled steel soaring to US$1,070 per tonne and the price of US hot-rolled steel reaching US$1,500 per tonne, while delivery dates are being pushed out to as late as the third quarter, it said. Steel mills worldwide have seen steady demand, thanks to Washington’s US$2.3 trillion infrastructure program and Beijing’s 10.6 trillion yuan (US$1.6 trillion) infrastructure program, as well as many economies beginning to recover from the fallout of the COVID-19 pandemic, China Steel said. “In Taiwan, domestic consumption, exports and investments are all up, meaning more demand for steel,” the company said. China’s target to reach “peak carbon emission” by 2030 and “carbon neutrality” by
The Executive Yuan yesterday approved an amendment to the Tax Collection Act (稅捐稽徵法) that would increase fines for tax evasion, aiming to fix a loophole that allows tax evaders to get away with milder penalties. Under the existing act, people found to have intentionally evaded paying their taxes face a fine of up to NT$60,000 (US$2,114) or five years in prison. Some lawmakers have long said that the act allows room for “certain powerful people” to skirt the law after dodging billions in taxes. For example, under the existing act, Landseed International Hospital superintendent Chang Huang-chen (張煥禎), who was in October 2018 indicted for not paying more than NT$500 million in taxes from 2007 to 2016, would only be fined up to NT$60,000. The amendment drafted by the Ministry of Finance stipulates that people found guilty of evading more than NT$10 million in taxes or profit-making enterprises found to have evaded more than NT$50 million in taxes are to face one to seven years in prison or a fine of NT$10 million to NT$100 million, the Executive Yuan said in a statement. Chang could be sentenced to seven years in prison and fined NT$100 million, the ministry said. The amendment would increase the maximum fine for mild tax fraud to NT$5 million, it added. The amendment changes the reward for those who report tax evaders to 20 percent of the amount of taxes evaded or up to NT$4.8 million, although tax bureau personnel, tax inspectors, their spouses and close relatives are ineligible for rewards. The revised act is to be forwarded to the Legislative Yuan for further deliberation, the Executive Yuan said in the statement.
The Financial Supervisory Commission yesterday gave Fubon Insurance Co (富邦產險) and Chubb Corp Taiwan (美商安達產險台灣) its approval to sell from today insurance policies that provide coverage to people experiencing serious side effects from COVID-19 vaccines. Chubb’s product would pay compensation if a policyholder experiences side effects that require hospitalization or a stay in an intensive care unit (ICU), or if they die within 90 days of taking a COVID-19 vaccination, the commission said. Fubon Insurance’s product has a shorter protection period, providing coverage for policyholders requiring treatment due to side effects within 14 days of being given a COVID-19 shot, the commission said. Asked whether the 14-day period was adequate, Insurance Bureau Deputy Director-General Wang Li-hui (王麗惠) told a news conference that the commission’s review focused on the fairness of the premiums. However, consumers should carefully consider the insurance policies before making a purchase, Wang added. The insurers said that they would not compensate policyholders if they received a COVID-19 vaccine abroad or a vaccine that had not been approved by local health authorities. PAYOUTS The insurers would use Central Epidemic Command Center data to determine which side effects could be attributed to a COVID-19 vaccine, they added. Chubb’s product would pay its policyholders NT$3,000 (US$105.70) per day during a hospital stay, but payments would cease after the 15th day, while policyholders in an ICU would be offered a one-time payment of NT$30,000, the company said in a statement. If the policyholder requires treatment again due to side effects of the second dose of a COVID-19 vaccine, they would again be compensated, Chubb added. If the policyholder dies due to side effects from vaccination, their family or a beneficiary would receive funeral coverage of NT$300,000, it said. Chubb has set a single premium for its product at NT$226 per year, regardless of the insured’s gender or physical condition, but only those
Dancers perform at a news conference in Miaoli City yesterday promoting the Miaoli Hakka Tung Blossom Festival. The festival, which takes place from Sunday to May 30, includes dance and music events, art and cultural performances, and tung blossom appreciation hikes, as well as farmers’ markets and exhibitions of local industries. Miaoli County Culture and Tourism Bureau Director-General Lin Yan-fu welcomed everyone to take part in the festivities.
WATERSHED MOMENT? Wedbush Securities Inc analyst Daniel Ives said Coinbase is a crucial piece of the crypto ecosystem and an indicator of mainstream adoption
Cryptocurrency exchange Coinbase Global Inc on Wednesday made a dramatic stock market debut amid frenzied interest in bitcoin and other virtual currencies, despite concerns about a bubble. The enterprise, the first company devoted entirely to cryptocurrency to list on a US stock exchange, debuted on the NASDAQ Composite at US$381 per share, 52 percent above its reference price, and rose as high as US$429.54 before finishing the day at US$328.28. The company ended the day with a market value of about US$86 billion, after topping US$100 billion earlier in the session. Coinbase chose a direct listing, which does not allow it to raise new funds, but does offer current shareholders — founders, employees and historical investors — the opportunity to sell their shares on the market. The company has benefited from bitcoin’s meteoric rise over the past year, with the cryptoasset’s price rising from US$6,500 last April to new records of as high as US$64,000 on Wednesday, before retreating somewhat. Other virtual currencies — such as ether, litecoin or stellar lumens — have also surged in line with bitcoin. The Coinbase entry “is potentially a watershed event for the crypto industry,” Wedbush Securities Inc analyst Daniel Ives said. “Coinbase is a foundational piece of the crypto ecosystem and is a barometer for the growing mainstream adoption of bitcoin and crypto for the coming years, in our opinion.” Founded in 2012 in San Francisco by Brian Armstrong and Fred Ehrsam, the platform allows users to buy and sell about 50 cryptocurrencies, including bitcoin and ether. In the first quarter, Coinbase had 56 million users and more than 6 million people per month making transactions, a company report showed. The company reported that revenue in the first quarter increased almost 10-fold year-on-year to US$1.8 billion, while profit increased 25-fold, in the range of US$730 million to US$800 million. If the situation seems
UNWINDING BIGGEST DEAL: Five years ago, Dell acquired VMware’s parent, EMC Corp, for US$67 billion, which helped the PC maker to branch out from its origins
Dell Technologies Inc on Wednesday said that it would spin off its stake in VMware Inc, creating two publicly traded companies and raising cash to pay down debt. Its shares jumped on the announcement. The spinoff would unwind, at least in part, a consolidation created five years ago in Dell’s US$67 billion acquisition of VMware’s parent, EMC Corp. The spending spree helped Dell branch out from its origins as a PC maker, but left the company saddled with debt. VMware would distribute a special cash dividend of US$11.5 billion to US$12 billion to shareholders at the close of the deal, which is expected by the fourth quarter, Round Rock, Texas-based Dell said in a statement. Dell, which owns 81 percent of VMware, would receive a payout of as much as US$9.7 billion. “We expect to drive additional growth opportunities for Dell Technologies, as well as VMware, and unlock significant value for stakeholders,” chairman and CEO Michael Dell said. “Both companies will remain important partners.” The spinoff would provide Dell with cash to live up to promises to investors to reduce its debt load, which was US$48.5 billion at the end of the first quarter. The company said that “core debt” was US$29.2 billion when it reported earnings on Feb. 25. VMware was founded in 1998 and acquired by EMC in 2004, which sold part of its stake in an initial public offering three years later. EMC’s holdings in the maker of data center software passed to Dell when it acquired EMC in 2016. Asked about their decision to reverse the industry consolidation strategy relatively quickly, Dell executives said that the split benefits investors, adding that the stock market has not given the combined company an appropriate value. “We think this is a move in the right direction for Dell and it helps unlock the sizable conglomerate discount that is
China should lift all birth restrictions to encourage families to have more babies as the population is aging faster than in developed countries, central bank researchers said on Wednesday. More emphasis should be put on investment and savings, and the rapid decline in the savings rate must be halted to deal with the heavy burden of supporting an elderly population, a working paper published by the People’s Bank of China (PBOC) said. “China must recognize that the demographic situation has changed,” PBOC researchers led by Chen Hao (陳浩) wrote in the paper. The country must “realize education and technological advancement will not be able to make up for the decline in population,” they added. Faced with a rapidly aging population, the government began easing its stringent decades-old one-child policy in 2013, eventually changing its rules in 2016 to allow families to have as many as two children. However, that has not helped to reverse the decline in the birthrate, which reached 10.48 births per 1,000 people in 2019, the lowest since the founding of the nation in 1949. In the US, the rate was 11.4 in the same period. The PBOC’s comments promoting fertility fueled a rally in baby and mother care-related stocks yesterday. The researchers made a number of forecasts in their paper: China’s labor force is expected to shrink at an annual rate of 0.5 percent from last year to 2025, resulting in a 15.2 percent decline in the workforce by 2050, from 2019. The dependency ratio — or the number of dependents in a population divided by the number of working-age people — is projected to rise to 43.6 percent by 2050, from 17.8 percent in 2019. The researchers said that China should not follow the low savings approach in developed economies, saying that “consumption was never a source of growth.” The country’s gross domestic savings rate declined to
Facebook Inc has signed a deal to buy renewable energy in India from a local firm’s wind power project, the social media giant’s first such deal in the South Asian nation, the companies said yesterday. The 32 megawatt (MW) wind power project, located in southern Karnataka state, is part of a larger portfolio of wind and solar projects that Facebook and Mumbai-based CleanMax are working together on for supplying renewable power to India’s electrical grid, they said in a joint statement. CleanMax would own and operate the projects, while Facebook would buy the power off the grid using environmental attribute certificates, the firms said. Facebook renewable energy head Urvi Parekh said that the company typically does not own the power plants, but instead signs “long-term” electricity purchasing agreements with the renewable power company. “That enables the project to seek out the financing that it would need,” she said. India is Facebook’s biggest market by users. In Singapore, Facebook has announced similar partnerships with energy providers Sunseap Group Pte, Terrenus Energy Pte Ltd and Sembcorp Industries Ltd on projects that can produce 160MW of solar power, Parekh said. The power generated by these plants would power Facebook’s first Asian data center that is set to start operations next year, she said. Data centers driving tech firms such as Facebook use up as much as 1 percent of the world’s energy, the International Energy Agency said last year. Tech firms such as Amazon.com Inc, Alphabet Inc and Microsoft Corp have pledged to operate carbon-free and achieve net-zero emissions, as demand for digital services is expected to rise. Separately yesterday, Facebook chief executive officer Mark Zuckerberg announced that the company’s global operations are now supported wholly by renewable energy and that it has reached net-zero emissions.
US businesses are feeling more optimistic as vaccinations against COVID-19 become common, and economic activity accelerated moderately in recent weeks, the US Federal Reserve said on Wednesday. However some areas are seeing prices rise, both as a consequence of supply-chain snarls and increasing demand, as consumers resume daily life with COVID-19 less of a threat, the Fed’s “beige book” survey of economic conditions found. In the period from late February to early this month, economic activity increased to “a moderate pace,” while “consumer spending strengthened” and “manufacturing activity expanded further” with half of the Fed’s districts “citing robust growth,” the survey said. “Outlooks were more optimistic than in the previous report, boosted in part by an acceleration in COVID-19 vaccinations,” it added. The report showed that signs of complications resulting from reopening the economy after the COVID-19 pandemic forced many businesses to downscale or modify operations for almost one year, with supply-chain disruptions stopping firms from meeting some orders. “Severe myriad supply constraints continued to hamper potential growth from demand described as ‘on fire,’ and activity remained below levels attained prior to the pandemic,” the Philadelphia district reported. There were also signs of price increases, which is a dynamic that is to be closely watched, given the massive government spending that has prompted fears from Wall Street and some economists that the world’s largest economy is set for a prolonged spike in inflation. “Input costs rose across the board, but especially in the manufacturing, construction, retail and transportation sectors — specifically, metals, lumber, food and fuel prices,” the report said. “Cost increases were partly attributed to ongoing supply-chain disruptions, temporarily exacerbated in some cases by winter weather events.” With the economy still short millions of jobs that existed before the pandemic, the survey said that most districts reported “modest to moderate increases in headcounts,” with the strongest gains
GERMANY Lockdowns cut into GDP Leading research institutes cut their joint GDP growth forecast for Europe’s biggest economy for next year as prolonged lockdowns hold back its recovery. The downgrade to GDP growth of 3.7 percent, from 4.7 percent previously, reflects a sluggish vaccination campaign, which has forced the government to extend COVID-19 restrictions. The outlook for next year was upgraded to 3.9 percent from 2.7 percent. The economy likely shrank by 1.8 percent in the first quarter of this year, RWI Leibniz Institute for Economic Research economic director Torsten Schmidt said in a report. BANKING No Toshiba buy: Norinchukin Japan’s Norinchukin Bank denied a report that it and state-backed Japan Investment Corp (JIC) are considering a possible buyout of Toshiba Corp. Nikkan Kogyo reported earlier that the two institutions and possibly other bidders could make an offer for the Japanese conglomerate. The plan would have aimed to relist the company in two years, the report said, without specifying its sources. “There is no such fact,” a Norinchukin Bank spokesman said. JIC representatives declined to comment. Toshiba shares yesterday were up about 1.6 percent in Tokyo trading, extending a week-long rally that had added 14 percent to its value. PHILIPPINES Banks must ‘know staff’ The central bank has approved rules that would tighten banks’ know-your-employee procedures, as financial frauds surge during the COVID-19 pandemic. Banks and financial institutions must adopt risk-focused screening that takes into account the sensitivities of positions that might require more stringent procedures, the Bangko Sentral ng Pilipinas said in a statement. There must be an adequate understanding of a candidate’s background and character, conflicts of interest and “a propensity to commit fraud or irregularity,” it said, adding that central bank records should be used in the screening process. AUTOMAKERS SsangYong goes bankrupt South Korea’s SsangYong Motor Co has been put under court receivership, the Seoul Bankruptcy Court
‘WHOLE INDUSTRY AFFECTED’: Supply constraints might persist, and as its plants operate near full capacity, not all orders could be fulfilled, the flat-panel maker said
AU Optronics Corp (友達光電) is planning to expand capacity amid strong demand for high-end display panels used in premium notebook computers and monitors during the post-COVID-19 pandemic period, the company said yesterday. The firm plans to boost capacity at its sixth-generation plant in Kunshan, China, to about 36,000 sheets per month from 27,000 sheets, AU Optronics said, adding that the expansion would be ready in the third quarter of next year. The NT$50 billion (US$1.76 billion at the current exchange rate) plant, built in 2016, was design to be expandable to 45,000 sheets per month, the firm said. The facility manufactures power-efficient low-temperature polysilicon flat panels for premium notebook computers and monitors targeting online gamers, it added. “Demand for high-end monitors with a curved display has been rising not only based on gaming demand amid the pandemic, but also due to many people who will continue working from home in the post-pandemic period,” AU Optronics president Frank Ko (柯富仁) told reporters on the sidelines of a news conference ahead of the annual Touch Taiwan trade show, which is to take place at the Taipei Nangang Exhibition Center for three days from Wednesday next week. The company is also to allocate manufacturing capacity for panels used in notebook computers and monitors, Ko said. This would result in a capacity increase, he said, without elaborating. AU Optronics’ board of directors last month approved capital expenditures of NT$455 million for technology and capacity optimization and adjustments. The firm’s factories are to be fully utilized until next quarter, Ko said, adding that it cannot serve all orders. Supply of key components would further deteriorate this quarter compared with the past two quarters, Ko said. In addition to a persistent IC supply shortage, supply has tightened for materials and components from display glass substrates to printed circuit boards and polarizers, he said. “The
FORCED OUT? Liu i-cheng, who left his position as the bank’s general-manager in March, said that he does not know of a purchase that allegedly led to his ouster
Next Bank (將來銀行) has allegedly acquired an overpriced IT system developed by its biggest shareholder, Chunghwa Telecom Co (中華電信), despite the doubts of former general manager Liu I-cheng (劉奕成) and the bank’s compliance and financial departments, Chinese Nationalist Party (KMT) Legislator Alex Fai (費鴻泰) said yesterday. Liu on March 18 resigned over the deal, Fai told a meeting of the legislature’s Finance Committee in Taipei, citing a source at the Web-only bank who objected to the purchase. Chunghwa Telecom, which holds a 41.9 percent stake in Next Bank, has appointed five directors to the bank’s board, including the telecom’s business group president Wu Li-show (吳麗秀), Fai said. Wu allegedly urged the bank to buy a NT$13.78 million (US$484,614) IT system developed by the telecom to address flaws in the bank’s system, Fai said. The project’s development time totaled 344.5 worker days, priced at NT$40,021 per day, he said. “That is almost the market price in the US. In Taiwan, the usual price per worker day is NT$3,000 to NT$6,000,” Fai said. Following an on-site inspection, the Financial Supervisory Commission (FSC) mandated an update to the bank’s system. However, Next Bank has not opened a public tender, nor has it formally employed the telecom for the task, Fai said, adding that it was unreasoanble for Wu to urge the bank to buy from the telecom. The bank’s internal rules stipulate that purchases of more than NT$5 million require approval by the board, Fai said, adding that the board did not discuss the matter. Liu, as well as the bank’s compliance and finance departments, disapproved the deal, but chairman Chung Fu-kuei (鍾福貴) asked to “find ways to address the deal,” Fai said, adding that Chung previously worked for the telecom as president of data communication. Liu aimed to review the then-proposed purchase at a board meeting in early February, where
Yulon Motor Co (裕隆汽車) yesterday cut its forecast of vehicle sales in Taiwan to 427,000 units this year, attributable to effects of the COVID-19 pandemic, as well as supply constraints of automotive semiconductors and shipping containers. Yulon forecast that sales would decline 3.8 percent from 444,000 vehicles sold last year. The automaker in November last year estimated a slower decline of 2.9 percent to 431,000 units. The government might also phase out incentives for replacing older vehicles, which would weigh on the market, Yulon vice president Lee Chien-hui (李建輝) told investors in Taipei. Vehicle buyers are eligible to a NT$50,000 (US$1,758) commodity tax refund when buying a new vehicle while retiring an old one. Due to concerns over the possible cancelation of the policy, vehicle sales in the first quarter increased by 17.3 percent year-on-year to 118,000 units, he said. Despite a conservative outlook for the local market, Lee said that Yulon’s operations stabilized following two years of turnaround efforts. Yulon posted a net profit of NT$2.74 billion last year, reversing losses of NT$24.47 billion in 2019. Earnings per share were NT$2.8, compared with losses per share of NT$26.13 a year earlier. Gross margin climbed to 23 percent from 7 percent. Yulon’s real-estate development project in New Taipei City’s Sindian District (新店) progressed well, the automaker said. Bookstore chain operator Eslite Spectrum Corp (誠品生活) and movie theater chain Vieshow Cinemas (威秀影城) are two of its tenants, Lee said. The project would be completed in the fourth quarter of next year as scheduled, he said.
Optical filter maker Kingray (晶瑞光電) yesterday said it plans to raise capital to purchase equipment to massively expand production after it becomes an approved vendor for STMicroelectronics NV. “Getting that vendor code was a very difficult process,” Kingray chief executive officer Leo Tsou (鄒政興) said, adding that STMicroelectronics would be a “key client.” STMicroelectronics is the maker of time-of-flight (TOF) modules for Apple Inc, among other clients. TOF modules require a narrow band pass filter (NBPF) to isolate the infrared wavelength, which is optimal for facial recognition. “Each cellphone has three kinds of eyes,” Tsou said, “The camera, the TOF and the ambient light sensor [ALS].” Kingray makes filters for TOFs and ambient light sensors, although Tsou said he has ambitions to break into the camera filter market, too. “The problem now is that we cannot compete with the Chinese camera filters on price, but we are working on making our filters smaller and thinner so that we can differentiate ourselves from our competitors,” he said. Kingray has facilities are in Hsinchu County’s Jhudong Township (竹東). Tsou said the company plans to first rent, then build more plants to increase production, which would remain in Taiwan. “We have no intentions of moving to China, it is too risky from a trade-secrets point of view,” Tsou said. “Meanwhile, other countries, such as those in Southeast Asia, do not have the highly skilled workforce we require.” The global market for NBPFs is dominated by US firm Viavi Solutions Inc. A key to Kingray’s ability to break into this market was two years of research and development, culminating in a new patent. Kingray’s patent is accepted in Taiwan, China, Japan and Germany, although not yet in the US. “Getting our own patent was essential to having clients’ design in our product,” Tsou said, adding that the company also has four other
Taishin International Bank (台新銀行), DBS Bank Taiwan (星展銀行) and King’s Town Bank (京城銀行) are working with social enterprise Domi Earth Co (綠然能源) to promote electronic bills, planning to use the money saved to help those in need. Taishin Bank, the banking arm of Taishin Financial Holding Co (台新金控), has 6 million credit card clients, Taishin Bank senior vice president Cres Huang (黃天麟) told a news conference in Taipei yesterday. About 1 million of them receive electronic bills, he said. Although some people think that only younger clients prefer electronic bills, many credit card holders in their 50s receive digital bills, as this saves them trouble recycling the papers, he said. “Users must feel comfortable with the bank’s digital tools. Otherwise they would not be willing to change,” he said. The bank could save NT$960,000 (US$33,761) per year if 10,000 cardholders who receive paper bills opted for digital bills, he said. Some of the money saved due to phasing out paper bills, which cost the bank NT$8 per cardholder per month, would be allocated to a project with Domi Earth to help poor families who struggle to pay utility fees, Huang said. The project would support them by installing energy-efficient light bulbs and home appliances, which would help them reduce fixed costs, he said. King’s Town Bank spokesman You Qi-wei (尤其偉) said that the bank is conducting a similar project. DBS Bank Taiwan head of digital banking Happy Ho (何益萍) said that 60 percent of the bank’s clients receive electronic bills, adding that this share would likely rise this year. The three banks have suggested that the Financial Supervisory Commission amend financial regulations to accelerate the transition to paperless banking, the three bank representatives said. “We must offer paper bills unless customers opt out of the service. That is not helpful for the paperless transition,” they said. Many people have concerns about plastic
A man sits on a racing car simulator on the first day of the Taipei AMPA and Autotronics Taipei trade show at the Taipei Nangang Exhibition Center yesterday. The four-day event features 380 exhibitors and thousands of new automotive products. The show’s organizers said they expect nearly 7,000 professionals would visit the trade show this year.
PHYTIUM FALLOUT: Minister of Economic Affairs Wang Mei-hua said the nation’s chip firms would adhere to US rules after the US added Chinese firms to its entity list
Alchip Technologies Ltd (世芯), which designs application-specific ICs for other companies, yesterday saw its shares fall by the maximum daily limit of 10 percent for the fourth consecutive session after a key customer was blacklisted by the US Department of Commerce’s Bureau of Industry and Security on Thursday last week. Alchip on Tuesday said that it had stopped shipments to Chinese semiconductor company Phytium Information Technology Co (飛騰信息技術), which was placed on the US entity list along with six other Chinese companies. However, the company’s share price yesterday, after continuing to fall, closed at NT$593, down 9.88 percent. Its share price has plunged 34.26 percent over the past four sessions, Taiwan Stock Exchange data showed. Yesterday, in a filing with the stock exchange regulator — required due to the volatility of the share price over the past few sessions — Alchip reported that net profit last month increased 85.75 percent year-on-year to NT$143 million (US$5.03 million), while revenue increased 66.06 percent to NT$1.033 billion. Earnings per share last month were NT$2.05, up 70.45 percent from a year earlier, the company filing said. In the first quarter, net profit increased 122.79 percent to NT$388 million from a year earlier, while revenue rose 74.92 percent to NT$2.66 billion, the company said. Earnings per share in the first quarter jumped 98.03 percent to NT$5.68, it added. Alchip, with 39 percent of its revenue coming from Phytium last year, on Tuesday said that this latest development could affect its revenue by as much as 25 percent this year. The company — which forecast that revenue this year would still grow at least 20 percent from NT$7.08 billion last year — said that it is working with its US counsel to gain a clearer understanding of whether its products are subject to US export regulations. A US Bureau of Industry and Security “permit
Employees in Taiwan received an average bonus of NT$70,513 (US$2,479.8) for last year, the highest-ever despite economic fallout from the COVID-19 pandemic, the Directorate-General of Budget, Accounting and Statistics (DGBAS) reported on Tuesday. The agency said that NT$70,513 was equal to 1.64 months of the average monthly salary. The average year-end bonus for last year, up from NT$69,577 in 2019, was calculated by combining all non-regular wages, such as bonuses, that employees received from December last year to February this year, it said. In Taiwan, companies tend to give year-end bonuses as an incentive to their employees before the Lunar New Year holiday. This year, the holiday — marking the beginning of the Year of the Ox — fell in the middle of February. The COVID-19 pandemic continues to be a major headache for some local industries, while other sectors have recovered, DGBAS Deputy Director Chen Hui-hsin (陳惠欣) told reporters in Taipei. The three sectors with the highest year-end bonuses last year were finance and insurance (3.92 months), real estate (2.39 months) and manufacturing (1.82 months). The sectors with the lowest year-end bonuses were those hardest-hit by the pandemic: the hospitality and food and beverage industries (0.49 months), as well as arts, entertainment and recreation venues (0.46 months), Chen said. After an increase in property transactions in the second half of last year, real-estate businesses distributed significantly higher year-end bonuses (2.39 months), up from those in 2019 (1.84 months) — and the highest since 2009, Chen added. Taiwan had 8.15 million workers at the end of February — 18,000 more than a year earlier, DGBAS data showed. The average monthly regular wage in January and February was NT$42,976, up 1.77 percent from a year earlier, the data showed.
Barclays PLC shares briefly dropped almost 10 percent in the opening minutes of yesterday’s session, the greatest intraday drop in more than a year, in what traders said was likely due to an error known as a “fat finger.” The stock entered a volatility auction at about 8:06am in London after two trades totaling about 48,000 shares at a price of ￡1.68, Bloomberg data showed. The shares recovered after the five-minute pause and were down 0.3 percent to ￡1.86 at midday. Trades made in human error are often referred to as “fat fingers,” from the idea that a person’s oversized digits might cause them to hit a wrong button. Yesterday’s apparent error briefly trimmed about ￡3.2 billion pounds (US$4.4 billion) from the bank’s market capitalization. OTHER ERRORS About two years ago, a fat finger was cited for an 83 percent drop in shares of investment firm Jardine Matheson Holdings Ltd in Singapore, while in 2018, BNP Paribas Securities was blamed for erroneous orders that knocked almost 10 percent off the value of Taiwan-listed Formosa Petrochemical Corp (台塑石化). Erroneous trades are sometimes canceled, but Bloomberg data showed no cancelations for Barclays as of midday. The day’s low, the data showed, matched that shown on the London Stock Exchange Web site.