Mobiletron to flat HID auto-lamp controller prices

Taipei, April 12, 2004 (CENS)--Taiwan's Mobiletron Electronics Co., Ltd. Will move to tap the market for high-intensity discharge (HID) auto-lamp controllers to challenge the leading position currently owned by Royal Philips Electronics of the Netherlands.

Mobiletron Chairman Kim Tsai claimed that his company would strive to make the prices of HID lamps more reasonable in the future. Mobiletron is listed on the Taiwan Stock Exchange (TSE) with major products including electric hand tools and automobile electronics.

Tsai made the ambitious announcement at a recent investor meeting in Taipei. He also claimed that Mobiletron will outstrip Arrow of the U.S. to become the world's No. 1 maker of electric nail guns in the fourth quarter of the year.

Tsai added that Porter Cable, the world's largest electric hand tool procurer, recently reached a reconciliation with leading distributor Lowe's, which is expected to double Mobiletron's tool sales this year.

Mobiletron's exports of electric hand tools to Porter Cable has dropped greatly since the second quarter of last year due to the disputes between Porter Cable and Lowe's. Tsai admitted that 2003 was the worst year for Mobiletron in its 21-year history.

Last year, Mobiletron's earnings per share (EPS) fell to NT$1.95 (US$0.06 at US$1: NT$32.9) from an average of over NT$3.8 (US$0.12) since 2000. This year, according to Tsai, his company's revenue will grow by at least 20% from last year and EPS will rebound to over NT$3 (US$0.09).

Tsai said that Mobiletron will work hard to develop new customers and make each big customer to account for 10%-less of Mobiletron's product shipment to reduce risks of sales concentration on a few major clients such as the Porter Cable.

As Mobiletron has switched production lines for electric hand tools to mainland China's Ningbo plant in the Jiangsu Province, Tsai said that his company's profit margins are expected to rise gradually. By winning new orders from Arrow's major customers, Tsai said that Mobiletron is expected to become the world's No. 1 supplier of electric nail guns this year, with an annual shipment of one million such guns for this year and 1.5 million in the future.

Mobiletron is also actively expanding its high-margin, low-competition automobile electronics businesses. The company expects to further boost revenues from such business to over 40% of its overall revenues this year.