The short-term and long-term temperature AUO competition enhancement

Panel maker AU Optronics (2409) February 2016 by season and panel monthly revenue decline in value, the lowest level in nearly 7 years, chugu rebounded in March, but the first quarter revenue may be nearly 7 years of low band, loss of the pressure is not small. Expected in the second quarter, driven by the new model of the inventory of goods, performance is expected to be better than the first quarter. But in the long run, with the mainland panel industry to improve competitiveness, the rise of the OLED forces, Hon Hai (2317) stake in SHARP finalized, the challenge gradually increased.

In the short term, the mainland a new wave of high generation LCD panel production capacity may fall on 2017 to the beginning of the year to the year of 2018, the temporary respite in 2016. At present, the application of high order continuous input AUO panel product development, including TV, monitor, notebook, industrial, automotive, public display panel and so on, with the second half of the Brazil Olympic Games and sports events to help out, is expected in the second quarter to the third quarter is expected to gradually improve.

However, the long-term point of view, although the Kunshan AUO 6 generation LTPS new production line will be put into operation in the third quarter of 2016 (the end of the initial investment amount of 25 thousand pieces per month, the planning capacity of 60 thousand / month), in small and medium size high order panel layout will be more complete, but with the Hon Hai shares SHARP finalized, in mainland China to promote OLED policies and OLED production planning process plant become clear, more LTPS during the new production line is brewing and coming to open in 2016 2018, layout panel industry is changing, competition may face more dangerous then auo.

AUO in the fourth quarter of 2015 revenue of about 83 billion 440 million yuan (NT below), quarter by 6.6%, gross profit margin dropped to 5.4%, a single quarter net operating loss of 1 billion 170 million yuan, net operating loss rate of 1.4%, industry M.Setek company provided Liezi asset impairment, attributable to the parent company owners net loss of 8 billion 180 million yuan, the basic loss per share 0.85 yuan. Total 2015 revenue of 360 billion 350 million yuan, an annual decrease of 11.7%, gross margin of 11.1%, net profit after tax of $4 billion 840 million, earnings per share of $0.51.

Following the January revenue fell to 24 billion 290 million yuan, a record low of nearly 4 years, in February, further down the revenue of $20 billion 570 million, minus $15.3%, an annual reduction of 27.5%, the cumulative total revenue of about $44 billion 860 million in the first two months of the year, an annual decrease of 25.8%. Estimated first quarter revenue quarter minus 15%-20%, an annual reduction of 2-3 into the second quarter may be the lowest since 2009.

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