HTC Investors

Printer Friendly Version  View printer-friendly version <<  Back
Convening of an investor conference concerning Q1 08 Business Review

1.Date of the investor/press conference:2008/04/25

2.Location of the investor/press conference:Conference call

3.Financial and business related information: 1st Q, 08'BUSINES REVIEW: (1)Quarterly revenue reached NT$ 32.7 billion, representing a 38.6% YoY growth rate, exceeding business guidance provided. (2)3G devices account for 70% of shipment. ASP improved slightly QoQ. (3)GPM, excluding warranty services expense, was 36.1%, better than expected due to better product mix. RSGA expenses ratio was 8.9%, lower than expected due to less headcount added in offshore entities and deferred marketing expenses spending. MATERIAL BOARD RESOLUTIONS: (1)Dividend payout a.Cash dividend NT$ 34 per share b.Stock dividend NT$ 3 per share (2)Employee bonus a.Cash portion NT$ 1.21 billion b.No. of shares 10.32 million shares, representing 1.37% share dilution and 25.0% NPAT based on the closing price prior to the date of the board meeting and consideration to the price after ex dividend (3)Set up an investment company with NT$ 300 million paid in capital to facilitate the investment activities in future (4)Approved US$ 5 million capital increase in HTC Suzhou to meet the factory's business development needs?with sufficient working capital 1st Q, 08' P&L-PRE EMPLOYEE BONUS (EB): (NT$ B) 1Q 07*1 YoY 4Q 07*1 QoQ 1Q 08 REVENUES 23.60 38.6% 39.01 -16.2% 32.70 GP 7.40 59.7% 13.50*2-12.5% 11.81 RSGA EXP. 1.67 74.2% 3.47 -16.0% 2.91 NOP 5.73 56.0% 10.45 -14.4% 8.95 NPBT 6.02 51.9% 10.87 -15.9% 9.14 NPAT 5.54 50.2% 9.99 -16.8% 8.32 GPM(%) 31.3% 34.6% 36.1% RSGA(%) 7.1% 8.9% 8.9% EPS *3(NT$)12.78 17.43 14.51 *1.Warranty service and inventory scrap(07Q1:NT$385M; 07Q4:NT$0) were included in COGS in this statement *2.The gross profit of 07Q4 excluded one time IP recovery of NT$1.67 billion *3.The EPS was calculated based on the outstanding shares at the time 1st Q, 08' P&L-POST EMPLOYEE BONUS (EB): (NT$ B) 1Q 07*1 YoY 4Q 07*1 QoQ 1Q 08 REVENUES 23.60 38.6% 39.01 -16.2% 32.70 (EB ADJ in COGS) 0.15 7.9% 0.26 -40.4% 0.16 GP 7.25 60.7% 13.24*2-12.0% 11.66 RSGA EXP. 2.91 46.1% 5.70 -25.6% 4.25 (EB ADJ in RSG&A) 1.23 7.9% 2.23 -40.4% 1.33 ADJ NOP 4.35 71.2% 7.95 - 6.2% 7.46 ADJ NPBT 4.64 65.0% 8.37 - 8.6% 7.65 ADJ NPAT 4.17 66.6% 7.54 - 7.9% 6.94 ADJ GPM(%)30.7% 33.9% 35.6% ADJ RSGA RATIO(%) 12.3% 14.6% 13.0% ADJ EPS*3 (NT$) 9.55 13.16 12.12 *1.Warranty service and inventory scrap(07Q1:NT$385M; 07Q4:NT$0) were included in COGS in this statement *2.The gross profit of 07Q4 excluded one time IP recovery of NT$1.67 billion *3.The EPS was calculated based on the outstanding shares at the time 1st Q, 08' KEY FINANCIALS: (NT$ B) 1Q 07 YoY 4Q 07 QoQ 1Q 08 CASH 38.91 63.1% 55.04 15.3% 63.47 AR 16.69 -0.1% 19.48 -14.5% 16.67 INVENTORY 4.31 79.7% 6.12 26.7% 7.75 NET WORTH 46.38 35.7% 56.08 12.2% 62.93 INVENTORY PROVISON 1.28-11.7% 0.92 23.0% 1.13 AR PROVISION 0.01 n.a. 0.27 7.7% 0.29 WARRANTY PROVISION 1.44 179.3% 3.47 15.9% 4.02 2nd Q, 08' BUSINESS OUTLOOK: (1)The 2nd Q revenue expects to grow around mid 20% on YoY basis, or around NT$34 billion. The potential growth rate could be affected by the hangover effect from new product launch (2)GPM expects to be 0.5% to 1% lower than that of the 1st Q, 08' level, around 35.5% to 35%, due to a one time inventory write down on one exclusive product for one operator. (3)RSGA expense ratio expects to be around 11% due to new product launch and salary adjustment. Operating profit margin of 2nd Q is expected to be between 24% and 25%. (4)Tax will be increased by around NT$ 353 million due to the10% tax rate applied to the undistributed earnings of Y07 profits.

4.Any other matters that need to be specified:None