Vertical Divider

Innolux Net Revenues for Q417 were NT$79.1m down 11.5% Y/Y; Profits Down 60.6%
February 19, 2018

Innolux, a non-OLED company, reported Q417 top line and bottom line was down 11.5% and 60.6% Y/Y. The company did report net profits of NT$37 billion (US$1.26 billion) or NT$3.72 per share on revenues of NT$329.2 billion in 2017. The company's total shipments of flat panels reached 28.47 million square meters in 2017, up 5.4% from a year earlier. Shipments of small- to medium-sized panels totaled 271 million units in 2017, increasing 20.4% from a year earlier, the company revealed. Despite a slowdown in the first quarter caused by seasonality and a market reduction in TV sales, and extension growth in China’s capacity, Innolux president Robert Hsiao expects its overall performance for 2018 to be better than that seen in 2017. The company expects:

• Large-sized panels to dip 7-9% sequentially in the first quarter with their ASP to fall 4-6% on average.
• Small- to medium-sized panel to sink 17-19% on quarter with their ASP to drop 1-3%.
• Commercial-use display products and complete TV sets should increase significantly in 2018 as the company has transformed itself into a system solution provider instead of merely a panel producer, according to Hung Mao-sheng, president of Innolux TV business unit.

 
Innolux believes the global supply and demand for TV panels will remain stable in 2018, with demand increasing 5-8% on Y/Y due to growing TV shipments and an increase in the average size of TVs, while the supply will expand 8-10% due mainly to new capacity of 8.6G and 10.5G fabs in China, Hung said. Innolux also expects its shipments of IT panels, particularly notebook applications, to continue to grow in 2018, buoyed by its automated backend production lines even as the global demand drops by 3-5%
Innolux expects its capex for 2018 to more than double to NT$55 billion (US$1.876 billion) due to the purchase of a 6G LTPS fab from its parent company Foxconn Electronics (Hon Hai) in late 2017. The plant will be run as an OEM factory for Foxconn with its revenues to account for 5-6% of Innolux's total revenues a year.