TAIPEI: Hiwin Technologies Corp, one of the nation’s major machine tool makers, yesterday posted a 3.55 percent annual decline in net profits for the last quarter due to foreign exchange loss, but the company expects growing demand for industrial automation to drive the next quarter’s business.
Hiwin has received more orders this quarter due to surging labor costs in China, company chairman Eric Chuo said.
To meet rising demand, Hiwin plans to expand production capacity, Chuo said.
“This quarter was good, but the next quarter will be even better as our new capacity for ballscrews and linear guideways will be in production,” Chuo said.
Chuo said he is optimistic about the business potential for industrial automation and the company plans to invest between NT$3 billion and NT$4 billion (US$980 million and US$130 million) this year into building new plants.
Chuo did not provide further details about the company’s capacity expansion and business outlook.
JPMorgan Securities Ltd expected Hiwin to grow its revenue by 14 percent this quarter to NT$4.1 billion from last quarter’s NT$3.63 billion, driven by the stronger-than-peers momentum and the contribution of the firm’s new industrial robots.
Hiwin’s industrial robots accounted for 5 percent of the firm’s total revenues last quarter, while its ballscrews and linear guideways contributed 91 percent.
Hiwin has been developing medical robots and is in talks with the China Medical University Taiwan to open a research and development center for further medical robot development.
Chuo said the company expects to ship medical robots to China in the second half of this year after gaining the Chinese government’s certifications for the products this month.
“We expect sales contribution from the medical robot segment to become meaningful soon,” Chuo said.
Hiwin’s net profit dropped 3.55 percent annually to NT$515 million last quarter, mainly dragged down by the depreciation of the euro against the US dollar.
As a result, Hiwin booked exchange rate loss of NT$133 million last quarter.
Hiwin said that the weak euro also eroded its revenues from Europe, but that demand from the region is still growing.
Earnings per share was NT$1.97 last quarter, compared with NT$2.04 per share a year ago and NT$2.99 per share last quarter.
Chuo said it is still to early to tell if the euro’s fluctuation will continue to affect Hiwin’s profitability this quarter, but the firm will continue increasing its competitiveness and enhancing its product quality to offset any negative impact from currency volatility.
Hiwin shares rose 1.3 percent to NT$234 in Taipei trading yesterday, outperforming the TAIEX, which gained 0.28 percent.
