Taiwan's Electronics Manufacturers Pressured to Cut Forecasts
November 15, 2001 (TAIPEI) -- Many of Taiwan's electronics manufacturers are coming under growing pressure to lower their result forecasts now that they are into the fourth quarter.
Behind the pressures are the impact of the Sept. 11 terrorist attacks on the United States, which absorbs the majority of Taiwan-made electronics products; the effects locally of Typhoon Nari, which struck Taiwan in September and killed nearly 100 people; and the continuing weak global economy.
The companies facing pressure to cut their projections, some for the first time and others for the second time this year, can be found in the upstream, midstream and downstream segments of Taiwan's electronics industry, suggesting the business downturn is across-the-board.
Taiwan's electronics manufacturers, including Hitron Technology Inc., Jean Co., Ltd., Merry Electronics Co., Ltd., Orient Semiconductor Electronics Ltd., Sunplus Technology Co., Ltd., and PWC Printed Wire Co., Ltd., are expected to lower their result outlooks due to their lower-than-expected first three quarter revenues.
PWC projects pre-tax earnings at NT$101 million (US$2.97 million at US$1 = NT$34) on revenue of around NT$3.61 billion (US$106.44 million) this year. But now it is struggling to keep itself from running into a loss.
The market is now skeptical about whether Merry is able to make its earnings goal this year since it achieved only some 30 percent of its goal in the first half. However, the company is confident, saying that international cell-phone giants have since May resumed delivering orders, and it has signed up many new customers both in Taiwan and China.
Heavyweight Taiwanese electronics manufacturers that have cut outlooks include Taiwan Semiconductor Manufacturing Co., Ltd., United Microelectronics Corp., Avision Inc., First International Computer Inc., Compeq Manufacturing Co., Ltd., Synnex Technology International Corp., Weltrend Semiconductor Inc., and RAL Electronic Corp.
The Sept. 11 tragedy has worsened the already weak world computer market, which was expected to perk up in the fourth quarter on the traditional year-end shopping season. Now, the spot price for a 128Mb DRAM chip has fallen close to US$1, beating manufacturers' expectations of US$2.5 to US$3.
DRAM manufacturers, including Nanya Technology Corp., ProMos Technologies Inc., and Powerchip Semiconductor Corp., are under pressure to cut their projections again as a result of the continuing weak market.
Both Powerchip and ProMos have said that they are indeed coming under pressure of slashing projection one more time, but they will decide only after third-quarter results come out.
(Commercial Times, Taiwan) |
