Taipei, May 12, 2008 (CENS)--Hon Hai Precision Industry Co., Ltd., Taiwan`s No.1 manufacturing conglomerate by revenue, made after-tax net income of NT$16 billion (US$525 million at US$1:NT$30) in the first quarter of the year, down 39.4% from a quarter earlier although inching up 2.85% from the same period of last year.

Hon Hai`s spokespersons ascribed the lower earnings result mostly to normal slacken market in the first quarter and lukewarm global economy triggered by the sub-prime home loan crunch. However, the company`s results for the first quarter were basically in line with expectations.

The company had revenue of NT$301.8 billion (US$10 billion) last quarter, contracting 27.1% from a quarter earlier while surging 22.25% from the same period of last year.

Industry watchers estimated the company`s operation had hit the bottom in the first quarter and would begin rebounding this quarter. Potential drivers for growth lying ahead include Apple`s orders for around 25 million contract iPhones and likely server orders from International Business Machines (IBM) and Hewlett-Packard (HP) after taking over part of rival Sanmina-SCI`s assets.

The appreciation of the New Taiwan dollar against greenback did not even take a slight toll on Hon Hai although it had hit hard many Taiwanese electronics manufacturers, which have exported their products on US dollar denomination. Instead, the company made NT$47 million (US$1.5 million) from foreign exchange.

Separately, the company has decided to set aside 8% of earnings this year for employee bonus.

By consolidated value count, Hon Hai and its four major affiliates scored after-tax net income of NT$20.9 billion (US$696 million) in the first quarter.

Innolux Display Corp. netted NT$3.3 billion (US$110 million) last quarter, shooting up 219% year on year although declining 50% from a quarter earlier. In the meantime, the company had revenue of NT$41.3 billion (US$1.3 billion). The company had a loss of NT$285 million (US$9.5 million) from foreign exchange in the first quarter, lower than an expected NT$400-500 million (US$13-16 million) loss.

Foxconn Technology Co., Ltd. earned NT$1.2 billion (US$41 million) in after-tax net income in the first quarter, recessing 22.6% year on year. Industry watchers attributed the earnings slowdown mostly to the company`s institutionalized employee-bonus spending, appreciation of renminbi, and hiked commodity prices and mainland Chinese labor costs.

CyberTAN Technology Inc. had after-tax net income of NT$98.2 million (US$3.2 million) last quarter, slumping 52.3% from year-earlier period.

Q1 Earnings of Hon Hai and Its Major Affiliates
Ticker symbol	Company	After-tax net income (in NT$100 million)	Quarter growth rate (%)	Annual growth rate (%)	EPS (in NT$1)
2317	Hon Hai	160.74	-39.4	2.8	2.56
2328	Pan International	2.16	-49.7	16	0.49
2354	Foxconn	12.45	-52.2	-22.6	1.64
3062	CyberTAN	0.98	-35.4	-52.4	0.32
3481	Innolux	33.07	-48.9	219.27	1.2
Sources: Taiwan Stock Exchange Corp.

(by Philip Liu)