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Career Technology Poised for Further FPC Market Gains

2011/04/01 | By Philip Liu

After having passed the NT$10 billion (US$345 million at NT$29:US$1) sales mark last year, Career Technology, Taiwan's leading flexible printed circuit (FPC) board supplier, is looking forward to continued strong growth in the coming years thanks to its advanced technology and a number of favorable conditions for the local FPC industry. These conditions include orders transferred from Japan following the massive earthquake and tsunami there and Taiwan's competitive edge in the assembly of smartphones and tablet PCs, two major users of FPCs.

In a recent interview with the Chinese-language Economic Daily News, a sister publication of the Taiwan Economic News (TEN), Wu Yung-hui, chairman of Career Technology, reported that his company's consolidated gross margin hit 25.17% last year, 8.14 percentage points better than 2009 and a five-year high. This achievement was made possible by a reduction in the share of lower-margin FPC assembly to 10% of total revenues, from a peak of 25%. FPC assembly is also hampered by a need for relatively large revolving funds and a higher risk in the procurement of components and parts.

Wu attributed his firm's stellar performance to a timely shift from notebook PCs into the field of smartphones and tablet PCs, which led to a demand for FPCs for the production of touch panels. The chairman said that the scope of FPC applications will expand considerably in the future.

Another major factor in the company's success is its advanced manufacturing technology, as evidenced by the installation of a double-sided roll-to-roll production line at its Taipei factory last year, one step ahead of its peers; this line greatly boosts precision, while providing a good yield rate and efficiency of production. The new production lines will also be installed at two of Career Tech's three mainland Chinese factories this year (in Suzhou and Kunshan, but not at the Shenzhen plant).

Wu believes that in view of the technological progress they have made in recent years, Taiwanese FPC suppliers can further expand their share of the global market, which now stands at 20%; this will be done mainly at the expense of Japanese competitors, who now command 80% of the market. The steep appreciation of the Japanese yen and the recent earthquake and tsunami will help Taiwanese suppliers to make further inroads.