TSE-listed Auto Parts Makers Report Lucrative Results for 2013

Thanks to recovering demand from China and North America, most Taiwan Stock Exchange (TSE)-listed auto-parts suppliers in Taiwan have reported rich results, including record earnings, for 2013.

For example, Hota Industrial Manufacturing Co., Ltd., a major supplier of transmission systems and gears to international automakers and tier-1 parts vendors, recorded record revenues and profits for the year, due largely to increased orders from big customers such as BorgWarner and Tesla.

The company registered after-tax net earnings of NT$431 million (US$14.4 million) last year, up 51.8% from 2012, translating into earnings per share (EPS) of NT$1.92 (US$0.06). Hota has charged off all its accumulated loss from 2012 and has decided to distribute big dividends to its shareholders in appreciation for their support during the low period.

Tong Yang Industrial Co., Ltd., Taiwan's biggest auto-parts company and the world's largest maker of aftermarket (AM) plastic body-parts, registered net earnings of NT$1.35 billion (US$44.9 million) last year, a 66.1% increase from a year earlier, translating into an EPS of NT$2.28 (US$0.08). The firm attributed the good results to higher profit margins and eased supply shortages resulting from the restructuring of its production lines over the past three years.

E-Lead Electronic Co., Ltd., a major in-vehicle infotainment system maker, chalked up record net earnings of NT$357 million (US$11.9 million), up 86% from 2012, translating into an EPS of NT$3.01 (US$0.1). Hiroca Holdings Ltd., a plastic parts and surface-coating maker, had net earnings of NT$458 million (US$15.3 million), up 45.9% YoY, and an EPS of NT$5.86 (US$0.2). Depo Auto Parts Ind. Co., Ltd., a major auto-lamp maker, reported net earnings of NT$1.34 billion (US$44.6 million), 29.4% more than 2012, giving an EPS of NT$8.06 (US$0.27).

Institutional investors believe that ongoing bad weather in North America will continue boosting demand for Taiwan-made collision parts--vehicle parts that are often replaced after car accidents, such as bumpers, engine hoods, auto lamps, side mirrors, door panels, and fenders. At the same time, increasing new-car sales in China will continue to create strong demand for original equipment (OE) auto parts supplied by Taiwanese makers.