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Taipei, Taiwan, February 23rd, 2023 – TPK Holding Co., Ltd (TWSE: 3673) (“TPK” or the “Company”) today announced 2022 fourth quarter unaudited consolidated operating results. Company reported revenues of NT$21,802 million and net profit of NT$20 million, or earnings per share of NT$0.05 for the quarter. For the full year of 2022, consolidated revenues amounted to NT$97,181 million and net profit totaled NT$544 million, equivalent to earnings per share of NT$1.34.

4Q22 Operating Results

Fourth quarter revenues were NT$21,802 million, down 22.0% sequentially and down 9.7% year-on-year. The decrease was mainly attributable to existing smartphone models heading towards end of production life and decline in large-sized tablet and notebook computer shipment. For 4Q22 revenues, small-sized products (<7”) posted a sequential decline of 49.2%. On contrary, tablet segment (7” to 11”) recorded a quarter-on-quarter growth of 11.4%, thanks to new product ramp-ups. Large-sized products (11” to 16”) registered 37.0% reduction in revenues owing to sluggish large-sized tablet demand and customers’ inventory adjustment. Due to lower economy of scale for the quarter, gross profits lowered to NT$747 million with gross margin at 3.4%.
In terms of COGS items, raw materials were NT$18,093 million, representing 83.0% of revenues, down from 84.5% for 3Q22. Labor expense recorded NT$1,533 million, down 8.3% sequentially, but up from 6.0% of sales for 3Q22 to 7.0% for this quarter. The increase was largely a result of heightened labor market due to surge in COVID situation in China. Depreciation cost remained flat at NT$923 million. 4Q22 Operating expense amounted to NT$954 million, up 11.0% quarter-on-quarter, mainly due to reversal of doubtful debts and gain on disposal of right-of-use assets in the third quarter. Given lower operating scale for the fourth quarter, Company posted an operating loss of NT$207 million.
The Company recorded net interest income of NT$16 million and foreign exchange loss of NT$50 million for the quarter due to RMB appreciation against USD. Other non-operating income amounted to NT$270 million. For 4Q22, net profit totaled NT$20 million, and earnings per share were NT$0.05.

2022 Full Year Operating Results

Despite heightened inflation and gloomy economy starting second half of 2022, TPK reported unaudited consolidated revenues of NT$97,181 million, down 5.7% year-on-year. In terms of product mix, revenues continued to tilt towards mid (7” to 11”) and large-sized (11” to 16”) form factors product, which in aggregate accounted for 78% of 2022 revenues, up from 73% for the previous year. Total shipments were 90 million, down 14.7% compared to 2021.
Gross profits recorded at NT$4,114 million, up 9.2% from the previous year by means of favorable product mix, which led to 75.1% increase in operating profits, to NT$550 million. TPK reported 2022 gross margin of 4.2% and operating margin of 0.6%, up from 3.7% and 0.3% respectively from the year earlier. Against the backdrop of monetary policy tightening and lower risk appetite for investment, Company posted lower non-operating profits for 2022. Furthermore, higher tax liability was incurred and resulted in 49.1% year-on-year decline in net profits to NT$544 million, equivalent to EPS of NT$1.34.

Balance Sheet & Cash Flow

As of December 31st 2022, cash and cash equivalent1 amounted NT$34,256 million, down from NT$39,512 million at the end of the third quarter while total bank borrowings also decreased from NT$30,967 million to NT$24,318 million. Capital expenditure for the quarter was NT$259 million on accrual basis and full year CAPEX amounted to NT$690 million, down from NT$797 million for the previous year. EBITDA remained healthy at NT$1,337 million for the quarter. For the full year of 2022, EBITDA reached NT$6,231 million. TPK remained at net cash of NT$9,938 million as of December 31st 2022.

Note: All financial numbers are prepared in accordance with IFRs, which is approved by regulators in Taiwan.
Note 1: Cash and cash equivalent includes “Cash Equivalents” and “Risk-Free Banking Financial Product.”

Press Release (PDF)

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