Foxconn International in the first half net loss 144 million U.S. dollars
Sun Yan Biao
● Staff costs: Growth Jin Yicheng
● major mobile phone makers: Order drag
● part of the new customer: competitors snatch
in Nokia products on behalf of international mobile phone manufacturers against the background of continued low gross profit margin, dependent on international mobile phone manufacturers to survive the global handset OEM orders for giant Foxconn International (02038.HK), has begun to face unprecedented pressure to change.
yesterday, Foxconn International released first half of 2010 filing shows the first half of Foxconn International revenues 3.229 billion U.S. dollars, up 2.12%, its net loss of 144 million U.S. dollars, which is Fuji Hong Kong market has been international since the second semiannual reports a loss. The difference is mainly due to losses in the first half last year by the financial turmoil, sharp drop in global cell phone demand; loss of the first half of this year the main reason, new customers Difficult to expand the original customer order gross margins dropped.
Foxconn International Wei-Liang Chen, chairman and CEO, said, Foxconn International will be the next focus is the implementation of cost control, resource integration and new business development clients.
main cause of loss of non-staff costs
While Wei-Liang Chen stressed that cost control is the focus of future work Foxconn International, but in fact, cost is not the root cause of Foxconn International loss.
earnings figures for the first half of the total number of international staff Foxconn 11.52 million, the total staff cost of 243 million U.S. dollars; the first half of 2009, Foxconn International total of 11.87 million employees, employees The total cost of 234 million U.S. dollars. This calculation, staff monthly salary of only 360 U.S. dollars (about 2448 yuan), compared to last year's 328.6 U.S. dollars (about 2234 yuan), up just less than one percent. Even this more out of nine million U.S. dollars in staff costs included in net profit of Foxconn International, Foxconn International in the first half loss of 135 million U.S. dollars is still, its loss is greater than the same period last year.
the root causes of loss, or order has become a major mobile phone makers EMS (electronics manufacturing services) of much use. For example, the average price of Nokia's market continued to decline to a great extent, affected the gross margin level Foxconn International.
Nokia filing shows Nokia mobile phones in the first quarter average price of 62 euros each, compared with 64 euros in the fourth quarter, a decrease of € 2, to the second quarter, the average mobile phone products Price further reduced 1 euro. Nokia devices and services in the second quarter gross margin was only 9.5%, down from 11.6% last year, also lower than the 12.5% in the first quarter of this year.
"First Financial Daily" According to Foxconn International calculated the financial numbers, Foxconn International gross profit margin of the first half of this year, only 2.79%, 6.63% compared to same period last year, a decrease of 3.84 percentage points, compared with 5.9% last year, gross margin level, a decrease of 3.11 percentage points. Low-margin makes Foxconn International gross profit of only 90.19 million U.S. dollars, compared to 210 million U.S. dollars last year gross margin, significantly shrunk by 57%.
In addition, OEM orders from Samsung mobile phone access to the Great Wall Development (000021.SZ) in the first half earnings figures, can also explain the plight of Foxconn International Holdings.
first half of the Great Wall of OEM business development revenue 5.896 billion yuan, an increase of 303.58 percent, the proportion of the total revenue up 57.44%, but the OEM business, gross margin was only 1.82%, down 2.74 percentage points year on year .
to narrow the gap with rivals
addition to international mobile phone manufacturers orders for the formation of low-margin predicament, the Foxconn greater pressure from international competitors BYD Electronic (00285.HK) of growing.
BYD Electronic Aug. 22 release of first half of the filing shows income of 7.468 billion yuan in the first half BYD Electronics, an increase of 96.47%, net profit of 362 million yuan, up 58.18 %, the overall gross margin was 12.16%, higher than the 9.37 percentage points Foxconn International. Among them, mobile phone assembly revenues 4.139 billion yuan, up 216%, the proportion of the total income rose to 55.42 percent.
BYD Electronic directors, said Li Ke, rapid growth in mobile phone assembly business, mainly to win the leadership of the international and domestic mobile phone manufacturers continue to order, including the TD mobile phone handsets, including 3G mobile phone assembly business income accounted for the proportion of raised to 40%.
BYD Electronics, a customer said it is the main cause rapid growth, winning ZTE and Huawei's 3G mobile phone orders. Parent company BYD BYD Electronic shares (01211.HK) the person admitted, ZTE and Huawei are indeed BYD handset business customers.
placed before the problem is that Foxconn International, its own less and less profitable existing customers and new customers has been BYD Electronic away. If the two parties continued to maintain the development momentum, Foxconn International's future is not so clear.
the first half of the income scale BYD Electronics Foxconn International is already 34%, if shares in the first half of 9.582 billion yuan BYD handset business income, business income BYD handset Foxconn International scale is 43.64%.
Prior to 2009, BYD Electronic's income scale is only 22.74% Foxconn International, while mobile phone revenue in 2008 BYD size of only 18.92% Foxconn International. In other words, Foxconn International and the gap between BYD handset business from more than 5 times in 2008, down to the current 2 percent.
compared to Foxconn International, with Apple's iPhone and iPad foundry business, Hon Hai Precision (2317.TW, Foxconn Technology Group company), like many of the state. Hon Hai Precision income in the first half of this year 1,198,358,000,000 Taiwan dollars (about 37.4 billion U.S. dollars), up 47.6%, net profit 34.74 billion Taiwan dollars (about 1.083 billion U.S. dollars), up 22%.
this view, select the client object, determine the future trend of Foxconn International.
