Chimei Innolux Likely to Turn Profitable in Q4

Taipei, Sept. 17, 2012 (CENS)--With market demand simmering along with lower expense listed from depreciation of its plants, Chimei Innolux Corp., one of Taiwan's top two display panel makers by output, is likely to turn profitable in the fourth quarter of this year.

The global market for display panels has been recovering, with supply to keep lagging behind demand in 2013. Riding on the market prosperity, Chimei Innolux saw its shipment of large-sized models hit a single-month high of 13.893 million units and posted combined revenue of NT$44.404 billion for August, up 11.6% from a month ago as the highest of this year,

This manufacturer shipped a total of 4.4 million LCD TV panels in August, including 800,000 39-inch models, 400,000 50-inch models, and 300,000 units of 29-inch models.

Given that the market keeps booming as expected, the company, which already witnessed its core business turn from red into black in August, is believed by institutional investors to turn profitable in the fourth quarter of this year.

One more reason behind the investors' optimism about Chimei Innolux close to resuming its profitability is lower expense from depreciation of its plants and equipment.

The company listed depreciation expense of about NT$22 billion both in the first quarter and the second quarter of this year, but the costs will drop to NT$18 billion for a single quarter during the second half, primarily because the manufacturer's depreciation expense of a 5.5-generation and a 5-generation production line already expired in June and the third quarter, respectively.

Chimei Innolux's Business Performance by Quarter
Period	Q3, 2011	Q4, 2011	Q1, 2012	Q2, 2012
Sales Revenue	NT$114.713 Bn.	NT$130.409 Bn.	NT$109.236 Bn.	NT$112.522 Bn.
Net Losses	NT$17.257 Bn.	NT$19.988 Bn.	NT$12.765 Bn.	NT$9.567 Bn.
Gross Profit Rate	-9.9%	-8.2%	-6.2%	-1.7%
Operating Margin	-15.5%	-13.2%	-11.1%	-6.8%
Net Profit Margin	-13.8%	-15.3%	-11.7%	-8.5%

Source: Chimei Innolux Corp.