Winbond Accounting confirms Nuvoton’s acquisition of Panasonic Semiconductor loss

  • 2020-12-25

The stock price of Winbond, a major memory manufacturer, bucked the trend when Taiwan stocks rose sharply on the 16th. The main reason was the third quarter 2020 financial report released last week. The net profit after tax for a single quarter was NT$331 million. , A significant decrease of 53.3% compared with the second quarter and a decrease of 44% compared with the same period in 2019, the EPS per share came to 0.08 yuan. Cumulatively, the net profit after tax for the first three quarters was 954 million yuan, a decrease of 35.06% from the same period in 2019, and EPS per share came to 0.24 yuan. Under this circumstance, the stock price of Winbond continued to be impacted. The closing price on the 16th came to 17.05 yuan, down 0.35 yuan, or 2.01%.

According to the integrated financial report for the third quarter released by Winbond, the subsidiaries including Nuvoton Technology increased their management and R&D expenses, although the third quarter revenue was NT$16.034 billion, an increase of 25.76 compared to the second quarter, also an increase of 19.47% from the same period in 2019. Among them, the gross profit margin was 26.96%, a decrease of 2.34 percentage points from the second quarter and an increase of 0.47 percentage points from 2019. The net profit after tax came to 331 million yuan, a decrease of 53.3% from the second quarter and a decrease from the same period in 2019. 44%, EPS per share is 0.08 yuan.


Analyzing its financial statements for the current quarter, after its subsidiary Nuvoton completed the acquisition of Panasonic Semiconductor in Japan in September, it immediately confirmed a loss of NT$254 million from Panasonic Semiconductor in Japan that month. Since Winbond holds a 59.8% stake in Nuvoton, it is also reflected in Winbond's consolidated financial report for the quarter.


In fact, when Nuvoton previously acquired Japan’s Panasonic Semiconductor, the market discovered that since 2014, Panasonic Semiconductor has continued to reform and lose weight, including the transformation from IDM to Fab-lite, and continued sales of factories, hoping to stop using the asset-light model. Loss. Unfortunately, these methods did not work. As of 2018, although Panasonic Semiconductor's revenue was 92.2 billion yen (approximately NT$25.8 billion), its net loss after tax was as high as 23.5 billion yen (approximately NT$6.6 billion). . And such continuous losses finally made Panasonic decide to withdraw from the semiconductor industry, which also contributed to the acquisition of Nuvoton.


Only after the acquisition of Panasonic Semiconductor, how Nuvoton deal with related losses has become the focus of attention. Market participants pointed out that although Nuvoton obtained the operating rights, patents, production equipment and personnel of Panasonic Semiconductor through mergers and acquisitions, it usually takes some time for Japanese semiconductor companies to adjust. If the merger is completed in September, Winbond Immediately after the accounting confirmed a loss of NT$254 million, it will be a lot of pressure throughout the year, and it is worthy of continued observation.

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