Leading Machine-tool Makers Expected to Score Big Earnings

Taipei, May 12, 2011 (CENS)--Thanks to the cross-Taiwan Strait ECFA (economic cooperation framework agreement) hitting the road and the shift of orders from Japan in the wake of the massive earthquake devastating northeastern Japan, Taiwan's leading manufacturers of machine tools and accessories, including Hiwin Technologies Corp., Tongtai Machine & Tool Co. and AirTac International Group, will be able to make big earnings this year as they have seen order visibility through the end of this year.

Focused on linear-motion devices, Hiwin said its production lines have been fully booked to fill orders through the end of this year. To meet increased orders, since the second quarter of this year Hiwin has consistently increased production capacities at its plants in Taichung Precision Machinery Park, Yunlin Science Park, and Tantze Industrial Park.

Institutional investors predicted Hiwin's sales to hit a new high of NT$1.2 billion in the second quarter of this year.

Specialized in the production of machining centers and PCB (printed circuit board) drilling machines, Tongtai has seen influx of orders since the beginning of this year. With the introduction of newly developed laser PCB drilling machines, the company will see annual sales grow 15% year-on-year to reach over NT$7.6 billion, or NT$4.66 in earnings per share, this year.

Tongtai saw consolidated sales hit NT$1.766 billion in the first quarter of this year, up 26.4% year-on-year. With a gross profit margin reaching 20.7%, the company scored NT$365 million in operating earnings in the first quarter of this year, up 9.3% from a year earlier. But the company's operating net income was down 19.1% year-on-year to reach NT$101 million in the first quarter because of the rise in spending in R&D management and operating fees for the development of machines for windpower generation. The company registered NT$72.37 million in after-tax earnings, or NT$0.35 in after-tax EPS, in the first quarter of this year.

The company said it has received orders for 340 units of machining centers from an electronics firm and will begin filling the orders between May and August.

Thanks to the implementation of China's 12th five-year development plan, AirTac, a leading manufacturer of pneumatic devices, will see substantial growth in sales this year because of the increased demand for automation devices.

AirTac saw quarterly earnings hit a historic high of NT$1.27 billion in the first quarter of this year, up over 50% from a year earlier. The company attributed the substantial growth of earnings to the fast growth in sales to China market. Institutional investors believed AirTac will be able to see per-share earnings hit over NT$10 in 2011.