Financial Performance - Revenue for the six months ended June 30, 2020, was $1,916,543 thousand, a slight decrease of 0.1% compared to $1,918,306 thousand for the same period in 2019[7]. - Gross profit for the same period was $261,217 thousand, representing a decrease of 30.6% from $376,360 thousand in 2019[7]. - Operating profit dropped to $31,913 thousand, down 73.8% from $121,836 thousand in the previous year[7]. - Profit attributable to owners of the company was $22,173 thousand, a significant decline of 78.2% compared to $101,834 thousand in 2019[7]. - The gross margin decreased to 13.6% from 19.6%, a drop of 6.0 percentage points[6]. - The operating profit margin fell to 1.7% from 6.4%, a decrease of 4.7 percentage points[6]. - Net profit for the period was $20,145 thousand, down 80% from $100,743 thousand in the same period last year[48]. - Basic earnings per share decreased to $0.33 from $1.55, reflecting a decline of 78.7% year-over-year[46]. - The company reported a total comprehensive loss of $10,425 thousand for the period, compared to a comprehensive income of $83,704 thousand in the previous year[48]. Revenue Breakdown - Revenue from the mobile device end market increased by 14.2% due to higher shipments of new smartphones[10]. - Revenue from the communication infrastructure end market decreased by 8.4% due to trade conflicts and changes in demand for optical modules[10]. - Revenue from the computer and consumer electronics end market increased by 5.5% driven by remote work and online learning trends[10]. - Revenue from the smart home and smart accessories end market decreased by 3.2% and 30.2% respectively, impacted by the COVID-19 pandemic[10]. - Revenue from automotive, industrial, and medical markets saw a revenue increase of 5.7% to $65,509 million, supported by rising demand for electric vehicles[15]. - Revenue from smart home market decreased by 3.2% to $120,229 million, reflecting ongoing trends in home office and online education[16]. - Smart accessories market revenue dropped by 30.2% to $183,434 million, indicating a significant decline in demand[15]. Cost and Expenses - Cost of sales increased by 7.4% from $1,542 million to $1,655 million, primarily due to pandemic-related shutdowns and changes in business model[19]. - Total expenses for the six months ended June 30, 2020, amounted to $1,909,980 thousand, an increase from $1,806,073 thousand in the same period of 2019, representing a growth of approximately 5.7%[88]. - The cost of goods sold was $1,165,736 thousand for the six months ended June 30, 2020, compared to $1,025,979 thousand in 2019, indicating an increase of about 13.6%[88]. - Employee benefits expenses totaled $329 million for the first half of 2020, up from $281 million in the same period of 2019[40]. - Legal and professional expenses increased to $30,899 thousand in the first half of 2020, up from $19,521 thousand in 2019, representing a growth of about 57.9%[88]. Cash Flow and Liquidity - Cash and cash equivalents decreased from $892 million to $744 million, while short-term bank deposits fell from $118 million to $94 million[26]. - The company reported a net cash used in operating activities was $(31,330) thousand, compared to $210,007 thousand for the same period in 2019, indicating a significant decline in operational cash flow[53]. - Cash outflow for the purchase of property, plant, and equipment was $(138,449) thousand, an increase from $(111,712) thousand in the previous year, reflecting increased investment in capital expenditures[53]. - The company reported a net cash inflow from financing activities of $3,432 thousand, a recovery from a net cash outflow of $(133,047) thousand in the same period last year[53]. - The company’s cash and cash equivalents decreased from $1,024,642,000 to $881,775,000 during the reporting period[111]. Assets and Liabilities - Total assets as of June 30, 2020, were $4,230,312 thousand, a decrease from $4,407,029 thousand at the end of 2019[49]. - Total liabilities decreased from $2,329,682 thousand to $2,160,268 thousand, a reduction of approximately 7.3%[50]. - Non-current liabilities decreased from $667,504 thousand to $653,285 thousand, a decrease of about 2.1%[50]. - Current liabilities decreased from $1,662,178 thousand to $1,506,983 thousand, a decline of approximately 9.3%[50]. - The company’s total liabilities increased due to higher bank borrowings, reflecting a strategic move to leverage debt for operational needs[53]. Strategic Outlook - The company anticipates stronger performance in the second half of 2020, despite uncertainties related to COVID-19[14]. - Strategic focus on emerging applications in interconnect solutions and automotive electronics is expected to capture new market opportunities[14]. - The introduction of new products such as WiFi 6 Mesh routers and GaN chargers at CES 2020 aims to enhance market share and consumer engagement[14]. - The company plans to continue its strategy of market expansion and product development, although specific figures were not disclosed[52]. - The company is considering strategic acquisitions to enhance its market position, with a budget of $100 million allocated for potential deals[156]. Shareholder Information - The company did not declare any interim dividends for the six months ended June 30, 2020, consistent with the same period in 2019[100]. - The company has implemented a share award plan approved by the board on January 5, 2015, aimed at incentivizing directors and employees[143]. - The stock option plan was adopted on December 19, 2017, to attract and retain quality personnel, with a maximum issuance of 130,000,000 shares, approximately 1.9% of the issued share capital at the time[145]. - The company reported a total of 6,881,287 thousand shares issued and fully paid as of June 30, 2020, an increase from 6,743,436 thousand shares as of January 1, 2019, representing an increase of about 2.0%[115]. - As of June 30, 2020, Hon Hai Precision Industry Co., Ltd. (Foxconn) holds 5,179,557,888 shares, representing 75.27% of the total equity[141].
FIT HON TENG(06088) - 2020 - 中期财报