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Taiwan's Machine Tool Makers Post Strong Earnings in Q1, 2014

May 23, 2014 | By CENS

Most of Taiwan's machine-tool makers had better-than-expected earnings in the first quarter of 2014 thanks to recovering global economy and the devaluation of the New Taiwan (NT) dollar.

Among the manufacturers, Goodway Machine Corp., Hiwin Technologies Corp., Kao Fong Machinery Co., Ltd., Tongtai Machine & Tool Co., Ltd., and Taiwan Takisawa Technology Co., Ltd. saw earning per share (EPS) double, with components maker Hiwin topping all with earnings of NT$2.1 per share.

Goodway Chairman Edward Yang pointed out that the company is seeing return on investment after years of developing turning centers for vehicle, healthcare and energy industries, and that the company still has NT$800-900 million (US$26.6-30 million) of unfilled orders and estimated the company's order visibility to extend to June or July.

The company's earnings more than doubled to NT$2.06 per share in Q1, 2014 from Q1, 2013's NT$0.84, becoming the island's most profitable machine-tool builder.

In the first quarter, Goodway had pre-tax earnings of NT$201 million (US$6.7 million) and net income of NT$163 million (US$5.4 million) on revenue of NT$1.6 billion (US$54.1 million), with core business profit climbing to NT$175 million (US$5.8 million) from last year's NT$112 million (US$3.7 million).

Tongtai earned NT$0.61 per share in the first quarter, compared with NT$0.12 of Q1, 2013, with pre-tax earnings of NT$218 million (US$7.2 million) and after-tax net income of NT$167 million (US$5.5 million), results of which have surged from some NT$60 million (US$2 million) it had in the same quarter of last year.

The company's consolidated revenue for the first quarter was NT$1.8 billion (US$61.1 million), soaring 26.2% year on year, with operating income up to NT$118 million (US$3.9 million) from the same quarter of last year's NT$9 million (US$300,000) or so.

The company still has NT$2 billion (US$66.6 million) of booked orders, up 20-25% year on year.

Taiwan Takisawa made NT$1.19 per share in the first quarter, up about two folds year on year, with pre-tax earnings of NT$102 million (US$3.4 million) and after-tax net income of NT$84 million (US$2.8 million) on consolidated revenue of NT$764 million (US$25.4 million), and gross margin rate of  23.33%.

According to the company's executives, the company still has NT$600-700 million (US$20-23.3 million) of booked orders thanks to the average NT$200-300 million (US$6.6-10 million) of orders received per month since last year. They ascribed the hefty orders mostly to Takisawa Machine Tool Co., Ltd.'s orders for 80-100 small CNC turning machines a month.

Although Falcon Machine Tools Co., Ltd. was still in the red in the first quarter, its net loss scaled down to NT$0.06 per share from NT$0.16 in the same quarter of last year. The company ascribed the loss mostly to increased inventory backlogs at its U.S. subsidiary. The company still has NT$300-400 million (US$10-13.3 million) of undelivered orders, with order visibility extended for at least three months. (KL)

Q1 '14 Operating Results at Taiwan's Listed Machine Tool Makers

Stock code
Company
Revenue
Pre-tax earnings
Net income
EPS
1530
Awea
NT$855M
NT$84M
NT$72M
NT$0.74
1540
Roundtop
NT$255M
NT$59M
NT$50M
NT$0.64
1583
Goodway
NT$1.6bn
NT$267M
NT$208M
NT$2.06
2049
Hiwin
NT$3bn
NT$641M
NT$498M
NT$2.1
4510
Kao Fong
NT$558M
NT$70M
NT$58M
NT$0.65
4513
Falcon
NT$577M
NT$5M
NT$4M
-NT$0.06
4526
Tongtai
NT$1.8bn
NT$218M
NT$167M
NT$0.61
4533
Shieh Yih
NT$967M
NT$83M
NT$67M
NT$0.48
6609
Taiwan Takisawa
NT$764M
NT$102M
NT$84M
NT$1.19
Source: Taiwan Stock Exchange Corp.


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