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By Meryl Kao / Staff reporter
Walsin Lihwa Corp (華新麗華) yesterday reported a net profit of NT$488 million (US$16.35 million) for last quarter, down 24.59 percent from the previous quarter, as growth in its stainless steel and nickel businesses was offset by the New Taiwan dollar’s appreciation.
That represented an annual decline of 78.78 percent from NT$2.3 billion.
Walsin Lihwa produces electrical wires and cables, iron and steel products, and semi-finished steel products.
Photo: CNA
Earnings per share dropped to NT$0.12 from NT$0.17 in the first quarter and NT$0.54 a year earlier.
The firm booked NT$10.7 billion in foreign exchange losses last quarter, leading to a non-operating loss of NT$100 million.
Gross margin last quarter fell to 7.3 percent from 8.2 percent in the previous quarter and 8.5 percent a year earlier.
Stainless steel shipments were little changed from the previous quarter and a year earlier, but the sharp appreciation of the NT dollar against the greenback cut revenue by NT$800 million, Walsin Lihwa acting spokesperson Sophi Pan (潘思如) said in an online earnings conference.
Stainless steel was the biggest revenue contributor last quarter, accounting for 52 percent, followed by cables at 29 percent, nickel at 17 percent and others at 2 percent.
Cable shipments remained strong last quarter, driven by Taiwan Power Co’s (台電) grid resilience plan and increased local private construction, and stronger seasonal demand for electronics in China, boosting revenue by NT$2 billion from the previous quarter, Pan said.
Copper wire revenue increased NT$6 billion due to slight shipment increases from the first quarter, she said.
Copper wire is typically used in motors, adapters and cable harnesses.
Revenue from nickel pig iron and nickel matte fell NT$100 million due to the local currency’s appreciation. Shipments last quarter rose quarter-on-quarter due to fewer deferred shipments, Pan said.
The company expects stainless steel sales this quarter to be flat on a quarterly basis.
Local steel prices should remain stable this quarter as uncertainty about US tariffs is almost over and nickel prices have hit rock bottom, company president Fred Pan (潘文虎) told investors.
Sales from Chinese manufacturers would remain weak this quarter, although Beijing has ordered domestic manufacturers to cut steel output to ease a glut, he said.
Steel sales in Europe are also expected to remain sluggish this quarter on seasonal weakness, he added.
Cable shipments this quarter are expected to be similar to last quarter’s level, supported by the grid resilience plan and ongoing private construction projects, Fred Pan said.
The company gave a cautious outlook for its nickel business, citing geopolitical uncertainties in Indonesia linked to mining policy and oversupply, which drove prices lower.
The construction of a plant to make submarine cables remains on schedule and is expected to be completed by the end of this year, Fred Pan said.
The plant would undergo a year-long verification phase next year before starting shipments in 2027, he said.
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