Taiwan’s listed manufacturing companies accelerated their research and development (R&D) spending last year to a record high NT$692.7 billion (US$21.4 billion), despite declines in sales and profits, the Ministry of Economic Affairs said yesterday.
The spending was up 2.9 percent from NT$673 billion a year earlier, driven mainly by expenditures by those in the electronic parts, computer products and optical components industries, the ministry said in a statement.
Companies in the electronic components sector spent NT$450.7 billion on R&D last year, up 2.2 percent year-on-year and accounting for 65.1 percent of overall spending, while those in the computer products and optical components sector spent NT$158 billion, up 4 percent from the previous year and contributing 22.8 percent to the total, the ministry said.
Photo: Ritchie B. Tongo, EPA-EFE
In terms of individual companies, global foundry giant Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) topped its local peers with R&D spending of NT$178.7 billion, up 11.1 percent from the previous year and accounting for 25.8 percent of total spending, the ministry said.
Smartphone chip designer MediaTek Inc (聯發科) came in second with spending of NT$80.6 billion and networking chip designer Realtek Semiconductor Corp (瑞昱) was in third place at NT$20.1 billion, it said.
The data compiled by the ministry showed that the 1,101 manufacturing firms listed on the Taiwan Stock Exchange and the Taipei Exchange — excluding overseas Taiwanese businesses with a primary listing in Taiwan — were still developing technologies to maintain their leading edge in the market, even though sales and profits decreased from the previous year.
The firms last year reported combined net sales of NT$18.88 trillion, down 10.7 percent year-on-year, while their overall operating profits decreased 26.4 percent to NT$1.49 trillion, with operating margin dropping 1.7 percentage points to 7.9 percent, the ministry said.
The setback was mainly due to headwinds facing the electronic components, the computer products and optical components, the chemical materials and fertilizer, and the petroleum and coal products sectors, it said.
Among the firms, Hon Hai Precision Industry Co (鴻海) garnered the highest sales of NT$3.45 trillion last year, followed by TSMC’s NT$2.15 trillion and Pegatron Corp’s (和碩) NT$1.18 trillion.
TSMC posted the highest operating profit of NT$907.4 billion, ahead of United Microelectronics Corp’s (聯電) NT$48.7 billion and MediaTek’s NT$42.3 billion.
With slowing growth momentum, investments in fixed assets by the listed manufacturing firms fell 20.9 percent year-on-year to NT$1.2 trillion last year, as a significant decline in investment by the electronic components industry offset higher outlays by the chemical materials and fertilizer, and the petroleum and coal products sectors, the ministry said.
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