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Hon Hai's Revenue and Profits Hit Record Highs in 2013

Apr 09, 2014 | By CENS

Hon Hai Precision Industry Co., Ltd., the flagship company of Hon Hai Group, world's largest EMS (electronics manufacturing service) firm by size, saw consolidated revenue and net profits both hit record highs of NT3.95 trillion (about US$131.1 billion) and NT$107.3 billion (US$3.25 billion), respectively, last year, up 1.25 and 17.01% year on year, according to the firm's latest financial report.

Although the tepid revenue increase fell short of expectation by the chairman, Terry Gou, to attain 15% annual revenue growth, institutional investors are generally upbeat with the banner profits—exceeding the NT$100 billion mark the first time and representing an EPS (earnings per share) of NT$8.16 as a four-year high.

Mainly driven by Apple Inc.'s big order for iPhone 5s, the company's consolidated revenue shot up 44.5% quarterly to NT$1.33 trillion in the fourth quarter of last year, with net profits of NT$42.615 billion, or NT$3.26 per share, shows the financial report.

A disappointment among the rosy performance, however, was that its fourth-quarter gross profit rate and operating margin both slightly slid, to 6.91% and 3.38%, respectively, from 7.07% and 3.46% achieved a quarter ago, to which  Hon Hai's directors attribute mostly a changed product mix.

As to outlook in the first quarter of this year, institutional investors opine that Hon Hai's consolidated revenue is likely to plummet 30-40% quarterly to NT$850-900 billion, due partly to a high base and partly to seasonal factors. But the company's performance is expected to gain considerable steam from iPhone 6 starting in the second half of the year.

At Hon Hai's year-end banquet held early this year, Gou admitted to being disappointed by his firm's anemic revenue growth last year, when the global economy remained sluggish during the first half while the tech market lacked growth momentum. However, the chairman stressed his confidence of reviving the firm's growth this year, with the aim to attain annual consolidated revenue of over NT$10 trillion (US$333.33 billion) in five to six years. (SC)


Hon Hai's 2013 Performance by Quarter
Period
Q1
Q2
Q3
Q4
Consolidated Revenue
NT$809.011 Bn.
NT$895.617 Bn.
NT$919.301 Bn.
NT$1.328 Tn.
Gross Profit Rate
5.68%
5.80%
7.07%
6.91%
Operating Margin
1.72%
2.08%
3.46%
3.38%
Net After-tax Profit Margin
2.02%
1.90%
3.34%
3.21%
Net Profits
NT$16.352 Bn.
NT$16.977 Bn.
NT$30.753 Bn.
NT$42.615 Bn.
EPS
NT$1.26
NT$1.30
NT$2.34
NT$3.26
Source: Hon Hai Precision Industry Co., Ltd.


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