Catcher Technology Co (可成), the nation’s leading supplier of light metal casings and enclosures for mobile devices, last week reported weaker-than-expected financial results for last year, as well as falling sales in the first two months of this year.
Net income dropped 59.7 percent year-on-year to NT$11.27 billion (US$373.06 million), or earnings per share of NT$14.63, after revenue decreased 4 percent to NT$91.63 billion, the company said in a regulatory filing on Tuesday last week.
Gross margin of 24.3 percent and operating margin of 15.4 percent were both lower than a year earlier due to sliding capacity utilization and reduced prices.
Cumulative revenue in the first two months of this year was NT$9.93 billion, up 18.8 percent from NT$20.41 billion in the same period last year, but last month’s revenue plunged 41.3 percent year-on-year and about 74 percent month-on-month to NT$2.02 billion, the lowest in nine years, company data showed.
Catcher said that its revenue performance was due mainly to the COVID-19 outbreak, as disease-prevention policies hampered its operations and logistics.
JPMorgan Securities (Taiwan) Ltd (摩根大通證券) said that Catcher’s revenue for this month should recover from the previous month thanks to an improving rate of workers returning to production lines at its plants in China.
However, it might still be shy of market consensus estimates by a “big shortfall,” JPMorgan said in a note on Wednesday, without elaborating.
Yuanta Securities Investment Consulting Co (元大投顧) said the company’s lower production scale amid the COVID-19 pandemic could lead to a lower-than-expected gross margin this quarter.
“However, we believe its low gross margin from last year should recover in 2020, with likely better-than-expected iPhone 11 sales, while its high confidence in its business relationships with major clients will enable it to see iPhone shipment growth,” Yuanta said in a note to clients on Tuesday.
Meanwhile, China-based Luxshare Precision Industry Co (立訊精密) is rumored to be expanding its presence in Apple Inc’s iPhone assembly business by as early as next year, with Catcher likely a major partner for metal casing and frame manufacturing, Chinese-language media reported.
Yuanta said that Catcher’s position in Apple’s casing supply chain should remain stable if Luxshare makes the move.
However, JPMorgan said it would not necessarily be a positive development for Catcher, due to potential regulatory approval headwinds and downside risks for market share dynamics.
Catcher shares fell 19.62 percent for the whole of last week and have dropped 16.08 percent so far this year.
TOP PERFORMER: The computer and optical products sector’s annual increase in output of 31.84 percent was the largest among Taiwan’s six major industries The industrial production index last month increased 16.06 percent year-on-year, rising for a third consecutive month as local manufacturing continued to boom, the Ministry of Economic Affairs said yesterday. Industrial production measures the change in the value of output produced by the local manufacturing, mining and utilities sectors. Last month’s growth, the largest annual expansion in 34 months, came as increases in manufacturing output, water supply, and electricity and gas production more than offset a retreat in mining output, the ministry said in a report. Manufacturing output, which accounted for 95.39 percent of the industrial production index, also rose for a third consecutive
Two global credit ratings firms lowered their forecasts for China’s property market, as an accelerating slump in home prices hampers the country’s efforts to rescue the sector. S&P Global Ratings now expects residential sales to drop 15 percent this year, more than the 5 percent decline it projected earlier. That would put sales below 10 trillion yuan (US$1.4 trillion), about half the peak in 2021, the ratings company said on Thursday. Fitch Ratings on Wednesday cut its annual sales estimate to a decrease of 15 to 20 percent, worse than an earlier estimate of a 5 to 10 percent drop. The ratings firms’
DIVERSIFYING: Following customers’ demand to improve supply chain resilience, ASE is looking for sites in the US, Japan and Mexico, a company executive said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it plans to launch a new high-end chip testing fab in the US next month to better serve its key customers based in North America, particularly California-based artificial intelligence (AI) customers. The new US testing facility would be operated by the firm’s subsidiary ISE Labs Inc, it said. ASE’s major customers, and high-ranking US officials and representatives from American Institute in Taiwan are to attend the fab’s opening ceremony on July 12, it said. ISE Labs last year acquired a 5,942m2 facility in San
A US banking giant fired more than a dozen employees for “simulating keyboard activity,” highlighting a battle within productivity-obsessed corporate America to tame a culture of faking work with gizmos such as mouse jigglers. The sackings by Wells Fargo & Co come as employers use sophisticated tools — popularly called “tattleware” or “bossware” — on company-issued devices to monitor productivity in the age of hybrid work that took off after the COVID-19 pandemic. Some workers seek to outsmart them with tools such as mouse movers — which simulate cursor movement, preventing their devices from going into sleep mode and making them appear