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Everlight Increases Capex to Keep up With Brisk Demand

2014/09/01 | By Ken Liu

Everlight Electronics Co., Ltd.,  world's No.1 LED packager by volume, has announced increasing capital expenditure for this year to NT$1.5-1.7 billion (US$50-56 million) from originally planned NT800 million-NT$1 billion (US$26-33 million) in light of brisk demand.

The company's median annual capital outlay was typically less than NT$800 million for adding production capacity by improving process technology.

The latest spending plan will add an estimated 500 million LEDs to  production capacity, bringing total output to four billion LEDs by the end of this year.

Everlight Chairman Robert Yeh says that strong demand had driven its output capacity utilization to 100% into the third quarter (Q3), up from around 85% in Q1 and 90% in Q2.

Yeh feels that lighting applications in Q3 will likely replace backlight applications as the major growth driver of the LED market, and that demand for backlight had slowed after China's weeklong May 1 national holidays without further growth until the October 1 national holidays.

Industry executives believe the company's Q3 revenue to grow briskly due to the arrival of high season for the Everlight-acquired German lighting fixture distributor, WOFI, whose revenue will  rebound to the NT$300 million (US$10 million) range a month in August and September from NT$100 million (US$3.3 million), with new streetlighting projects introduced by Taiwan government to also drive revenue.

Lighting business will account for increased percentage of its Q3 revenue after rising to 16% in Q2.

The company had total revenue of NT$13.9 billion (US$463.9 million) throughout the first half of the year, up 27.47% year on year. (KL)