Chenming Electronic Tech. Corp.




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Steady improvement of Uneec operation; profits increased at Ningbo plant



With the growth of the server chassis and mobile device parts business, and continued optimization of the product portfolio, uneec (3013)  revenue steadily raised quarterly in last year. In the first three quarters of last year, the EPS had reached 0.98 NTD. The annual EPS is expected to surpass 1.14 NTD in 2016. lt has increased the shareholding of the Ningbo plant to 72% in Q3 last year. Looking forward to this year, with the Ningbo factory profit contribution increased, plus the data center building demand, also the electronic products lighter weight and higher precision requirements, the company still sees good growth opportunities in the server chassis and mobile device parts business.


Uneec is a professional machine component R&D and manufacturing company. The server and PC chassis account for approximately 60 to 70% of the revenue; smart phones, tablet PCs, and wearable devices components account for about 30%. The core technologies are MIM (metal injection molding), NMT (Nano processing technology). The rest of the revenue is from the tooling production.


Uneec’s profit performance in recent years has been improved by the expansion of revenue scale and product mix optimization; it’s revenue in last year showed a steady upward trend in healthy status. In July of last year, the original financial supervisor took over as general manager. The chairman of the board of directors no longer serves as the general manager. Under the company's continuous enhancement of overall production cost and expense control, operating expenses in the first three quarters of last year only increased by 6% year-on-year, while in the first three quarters of last year, the consolidated revenue increased by 17% year-on-year. As a result, uneec’s operating profit in the first three quarters of last year has reached its full-year performance of 2016. However, due to industry foreign exchange loss, the EPS of the first three quarters of last year was 0.98 NTD, which is still a gap from the 1.14 NTD in 2016.


According to the legal person, although there was a foreign exchange disruption in Q4 last year, but the profit of uneec for the whole year is still expected to surpass 2016, and there is a chance for profit to continue to improve.


In addition, Chenming Ningbo Plant mainly manufactures server chassis for ODM server makers, and its end customers are well-known Internet companies. It is optimistic the demand for data centers will drive the growth of the server chassis business, uneec Acquired Ningbo Plant shares from another shareholder Chenming Industrial (Hong Kong). The Ningbo Plant's shareholding has been increased from 52% to 72% in Q3. This purchase improved the profit contribution to uneec. Through the continue integration of resources and improve performance, it is expected to make Ningbo plant operations more competitive.


Looking ahead this year, due to the number of working days, the legal person believes that Chenming’s Q1 revenue performance is relatively flat, while it’s cumulative total revenue for the first two months of this year is slightly up by 2%. Overall, the company’s operation performance for this year depends on the server chassis, and mobile devices and other related parts orders status.


The legal person is optimistic that as the demand for data center construction continues to grow and the new platform of the Purley server is used, the overall server industry's kinetic energy will recover this year compared with last year. In the mobile device parts business, Chenming is the world's leading MIM manufacturer. In addition to continuously expanding the scope of MIM applications, NMT and other solutions can also be provided. Most of the customers are the world's major electronics manufacturers. It is expected that as the penetration rate of MIM in clients continues to increase, it is still expected to receive new orders.


Money DJ  Reporter 鄭盈芷reports