AUO, Innolux, Caijing and Yuantai launched large investments this year totaling NT $67.3 billion

AUO, Innolux, Caijing and Yuantai, the top four display companies in Taiwan, have a total capital expenditure plan of 67.3 billion yuan (NT, the same below) this year, a new high in the past four years after the outbreak of the epidemic, with an annual increase of nearly 7%, revealing that Taiwan's four major manufacturers are bullish on the future outlook and are making advance arrangements to welcome business opportunities brought by the recovery of the economy.

Among the top four in Taiwan, AUO ranks first in the absolute amount of capital expenditure this year, only a slight decrease of 2.6% from last year's 35.95 billion yuan; Innotech, Caijing and Yuantai all increased their investment, and Innotech is estimated to reach 22.5 billion yuan, a growth of 6.9% from last year's 21.05 billion yuan; Caijing is 3.8 billion yuan, an increase of 16.9% annually; Yuantai estimates a maximum investment of 6 billion yuan, double that of last year, and the growth rate is unmatched in its peers.

Affected by panel price declines, AUO and Innolux's net after-tax losses in 2022 were 21.101 billion yuan and 27.99 billion yuan respectively, both of which were the worst in the past ten years; Caijing's net after-tax loss was 2.517 billion yuan, down to a nearly 11-year low. The three panel factories actively regulated capacity utilization and cash flow last year.

AUO originally planned to spend 45 billion yuan in capital expenditure last year, and was preparing to start the construction of a second 8.5-generation factory at the Zhongke Houli Plant. Unexpectedly, the panel economy turned sharply, and AUO lowered its capital expenditure target twice to within 36 billion yuan. The actual amount of expenditure was 35.95 billion yuan.

With the recent stabilization and recovery of panel prices, AUO has become optimistic about the future outlook. The board of directors has adopted a capital expenditure target of 35 billion yuan this year, locking in investments in high-end production capacity, new product planning and layout, and mass production of microled new technology platforms. It will go to Vietnam to set up a module, rear integration factory, and participate in renewable energy joint ventures.

Innotech was also deeply affected by the sluggish economy last year. It originally set a capital expenditure target of 26 billion yuan, but the final actual expenditure was only 21.05 billion yuan. As market conditions stabilize, Qunchuang has set a capital expenditure target of 22.5 billion yuan for this year.

Innocent emphasized that this year, it will continue to strictly control costs and expenses, and continue to optimize its product portfolio and strengthen its technology in non-panel application fields to maintain a sound operating and financial situation.

Caijing originally planned to spend 7.5 billion yuan in capital last year, mainly for equipment refinement improvement and the upfront cost of building a new factory in Nanke. Considering the downturn in the economy, the board of directors decided to suspend the plan to build a factory. The actual capital expenditure last year was only 3.25 billion yuan, and this year's target was raised to 3.8 billion yuan.

Yuantai was the most prosperous manufacturer among Taiwan's top four monitors last year, mainly benefiting from the booming sales of e-books and electronic shelf labels.

Yuantai's consolidated revenue last year was 30.06 billion yuan, an annual increase of 52.9%, reaching an 11-year high; gross profit margin was 53.99%, an annual increase of 10.29 percentage points; net after-tax income was 9.91 billion yuan, an annual increase of 92.4%. Full year profit, gross profit margin and net income per share peaked simultaneously.

Yuantai has continued to expand production in recent years, with an original capital expenditure of 5 billion yuan to 6 billion yuan in 2022. However, due to the surge in raw material costs, the investment has slowed down. Last year, the actual capital expenditure was only 3.1 billion yuan. As raw material prices continue to recede, the company is investing heavily this year, and is expected to spend as much as 6 billion yuan to meet the funding needs of expanding new production lines, building a new production office building for the Hsinchu factory and the new Guanyin factory.