Taiwan's leading machine-tool makers remained profitable in the first half (H1), 2014 despite the revaluation of the new New Taiwan dollar against the U.S. dollar, which seriously compromised gains from foreign exchange in H1.
Industry executives ascribe such profitability mostly to the recovering U.S. and European economies, which motivate machinery importers to begin restocking. They also foresee the machine-tool business to improve in H2 over H1.
In H1, brisk orders considerably boosted production capacity utilization and revenue at most of the island's machine tool makers, who strictly controlled cost to increase profit.
Falcon Machine Tool Co., Ltd., (Chevalier brand), turned a profit in May mostly due to tight cost control despite having broken even in sales in the month and April. In Q1, the company posted net loss of NT$0.06 per share due to increased inventory at its American subsidiary.
In June the company landed around NT$200 million (US$6.6 million) of orders, increasing booked orders to NT$400 million (US$13.3 million) or so, with such unfilled orders to keep its production lines busy throughout this September.
The Falcon-held Focus CNC Co., Ltd. is still in talks with several manufacturers in China of wheels, trying to seal deals to supply hundreds of millions of NT-dollars in lathes, which will likely boost the parent company's consolidated revenue in Q3 this year.
Roundtop Machinery Industries Co., Ltd. executives say that the company received around NT$80 million (US$2.6 million) of orders and delivered around NT$70 million (US$2.3 million) of the orders this June. So far the company still has NT$620 million (US$20.6 million) of unfilled orders, which will keep the company's production lines busy throughout this November.
They say that the company's major revenue earners now are customized machines for making oil exploration, wind power, infrastructural, and aerospace equipment.
Kao Fong Machinery Co., Ltd. executives conceded to losing NT$5 million (US$166,666) or so from foreign exchanges in Q2, which eroded almost all its foreign exchange gain in Q1. Industry executives estimate the company's earnings-per-share at approximately NT$1 in H1 this year based on revenue exceeding NT$1 billion (US$33.3 million).
Goodway Machine Corp. executives say that the company received at least NT$200 million (US$6.6 million) of orders each this May and June, with orders from European automakers and aircraft builders increasing for mid-range and high-end combination machines. So far the company still has around NT$800 million (US$26.6 million) of unfilled orders, which will keep its production lines busy throughout the end of this September. The company and its subsidiaries together still have NT$2.3 billion (US$76.6 million) of unfilled orders.
Goodway estimates it and subsidiaries had a combined loss of NT$20 million (US$666,666) or so from foreign exchanges in Q2, eroding the majority of the NT$26 million (US$866,666) gain from such exchanges in Q1. Nevertheless, the group stayed profitable in H1.
The Goodway-held Awea Mechantronic Co., Ltd.'s executives say that the company received NT$300 million (US$10 million) of orders in June mostly from Taiwan and Europe. The subsidiary received more orders from China in May and June than in March and April, raising booked orders to NT$1.4 billion (US$46.6 million). (KL)
