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AUO shares significantly boosted by 2017 results

2018/02/08 14:22:58

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Taipei, Feb. 8 (CNA) Shares of AU Optronices Corp. (AUO), one of Taiwan's largest flat panel makers, moved sharply higher and outperformed the broader market Thursday as buying was sparked by the company's earnings in 2017, dealers said.

Caution remains, as prices of flat screens in the global market have shown signs of declining, so investors should be alert to the possibility of slower earning momentum for AUO in 2018, the dealers said.

Shares of AUO ended up 3.76 percent at NT$13.80 (US$0.46) Thursday on the Taiwan Stock Exchange, where the weighted index was down 0.22 percent at 10,528.52 points.

"The current gains posted by AUO shares completely reflected its robust earnings in 2017," Hua Nan Securities analyst Kevin Su said. "Due to its relatively low valuation, the results attracted bargain hunters today."

In an investor conference held the previous day, AUO said its net profit for 2017 hit a 10-year high of NT$32.36 billion, up sharply from NT$7.82 billion recorded in 2016.

Its earnings per share (EPS) for 2017 stood at NT$3.36, jumping from NT$0.81 seen a year earlier, as AUO made efforts to improve its product portfolio, the company said.

It was the fifth consecutive year in which AUO had reported a net profit.

In 2017, AUO's operating margin -- the difference between sales and the cost of goods sold and operating expenses -- rose to 11.5 percent from 3.7 percent in 2016, while its gross margin -- the difference between revenue and cost of goods sold -- also grew to 17.9 percent from 10.5 percent.

AUO said shipments of its large panels for 2017 topped 112 million units, up 1.2 percent, while it shipped 169 million small and medium-sized screens, up 9.7 percent.

In the fourth quarter alone, AUO's net profit totaled NT$4.20 billion, down from NT$8.97 billion seen over the same period of 2016, due to falling panel prices.

In the October-December period, AUO posted NT$0.44 in EPS, down from NT$0.93 over the same period of 2016.

"A drop in screen prices is expected to continue this year, which will squeeze AUO's bottom line, and it's likely that AUO will witness its net profit falling," Su said.

(By Pan Chih-yi and Frances Huang)