Hsinchu, Taiwan,
Second Quarter 2006 Unaudited Consolidated Financial Highlights
- ARevenues decreased 8.1% QoQ to NT$60.90 billion
- Net income decreased 97.3% QoQ to NT$182 million
- Earnings per share (basic EPS) of $0.03 per common share (US$0.01 per ADR)
- Gross margin: 8.5%
- Operating margin: 2.2%
- EBITDA margin: 21%
AUO Corporation ("AUO" or the "Company") (TAIEX: 2409; NYSE: AUO) today announced unaudited results for 2Q2006. For the second quarter ended June 30, 2006, AUO's consolidated revenue totaled NT$60.90 billion (US$1.88 billion*), net income NT$182 million (US$5.63 million), and basic EPS NT$0.03 per common share (US$0.01 per ADR unit). For the first half year ended June 30, 2006, AUO's consolidated revenues totaled NT$127.15 billion (US$3.93 billion), net income NT$6.83 billion (US$0.21 billion), and basic EPS NT$1.12 per common share (US$0.35 per ADS.)
Gross margin for the second quarter declined 8.2 percentage points to 8.5%. This brought operating margin to 2.2% and EBITDA margin to 21%. Mr. Max Cheng, Vice President and Chief Financial Officer of AUO noted that the company's operation in the second quarter experienced faster and larger than expected declines in Average Selling Price in all product segments. However, 2Q2006 panel shipments are aligned with the Company's guidance revised on June 6; large-size panel increased 8.1% to 10.1 million while small- and medium-size panel also rose by 14.3% post 18.1 million from last quarter. Panel Average Selling Price by square meter, is weaker than the Company anticipated, declined by about 14% sequentially, directly resulted in the company's 2Q2006 profit. The higher-than-expected panel pricing declines are mitigated by the reduction of output in response to ease inventory pressure, the best cost control and better product mix.
On a sequential comparison, second quarter revenue declined 8.1% and net income decreased 97.3%. On the year-over-year comparison, second quarter results represent a 31.7% increase in revenue, while net income experienced a 61.3% decrease to NT$182 million.
AUO's Executive Vice President, Dr. Hui Hsiung, also noted that in the second quarter, the ratio of consumer electronics display sales (TV display, mobile device display and audio-video display) was approximately equal to the information technology display sales (desktop display and notebook PC display), reached 48% and 49% respectively. This also reflected AUO's balanced deployment and well management in terms of the development of its all product segments. Although the industry experienced seasonal weakness true to form, the shipments of AUO's all product segments represent increase among the peers. Particularly, the shipments of TV, notebook PC and mobile phone segments all hit historical high for the single quarter.
*Amounts converted by an exchange rate of NTD32.33:USD1 as of June 30, 2006.