TAICHUNG, TAIWAN, April 27, 2007 -At the 2007 Annual Shareholders’ Meeting of Wintek Corporation (2384), the shareholders resolved to acknowledge the 2006 financial statements. The Cash dividend of NT$1 per share and GDR and private placement proposals were approved and election of Board directors and supervisors were held. The 2007 first quarter consolidated results were also announced.
The utilization rate for the third generation TFT production line purchased last year by Wintek Corporation is expected to be low during the first half of this year due to the customized requirements of small to medium sized displays. Adopting a business strategy to use in-house TFT panels from the company’s production facilities, Wintek has higher capital expenditure than other module manufacturers in order to fulfill the needs of multinational corporations. Since Wintek’s business strategy differs from conventional module manufacturers that have lower capital expenditure, it will take longer to see returns on this investment. Demand for small to medium sized display is increasing recently, considering the design and components preparation requirements, utilization rate is expected to improve beginning in July of this year.
With regard to products, CSTN prices have declined due to TFT pressure. Though, the company believes that CSTN growth will not be as high as TFT, the sharp decline in CSTN suppliers, however, should bring market consolidation in a relatively short time. As demand for mobile phones increases in emerging markets, volumes should remain steady. In addition, rising demand and prices for large TFT panels should help to ease the price pressure on CSTN and small to medium sized TFT panels.
As Smart Phone volumes increase, Touch Panel supply will tighten. Consequently, possessing in-house Touch Panel capability will be a definite advantage. Wintek has also made significant progress in developing a new Capacitive Type Touch Panel. Wintek believes this will become the mainstream technology for future market applications. As major multinational corporations start use of this technology broadly on handheld electronic devices, this touch panel technology will quickly enter the mass production stage. Besides being used in Smart Phones, DSC, GPS and game devices, this technology can also be used in large screen products such as Notebook computer screens, Television screens and large presentation screens. Wintek’s long-term R&D work in related basic components and technologies fields has enabled the company to upgrade its product technology faster and more smoothly than other manufacturers. Combined with display panel, touch panels will provide a significant boost to future company sales.
Wintek’s sales and profits were down for the first quarter primarily because this is the traditional slow period for the industry, the major customers have downgraded their sales and profit forecasts and product prices and quantities both declined. For the first quarter of 2007, consolidated net sales was 7,281 million, gross profit was 590 million（8%）, operating loss was 92million（-1%） and net loss was 199（-3%）. Industry conditions during the second quarter should resemble the first quarter so Wintek sales are expected to maintain first quarter levels. The second half of 2007 is the peak season for electronic products especially mobile phones so sales should improve quarter by quarter.
