Chang Wah Electromaterials Inc. (CWE), a leading semiconductor materials and distribution company based in Taiwan, recently held a board meeting where the promotion of General Manager of Sales, Thomas Huang, to CEO was approved.
CWE stated that the previous CEO, Canon Huang, had retired. To align with operational development and group strategy, the board approved the promotion of Thomas Huang, who is also the head of the Lead Frame Division, effective August 7, 2024.
For the second quarter of 2024, CWE reported consolidated revenue of NT$4.255 billion (US$131.47 billion), a 6% increase quarter-on-quarter and a 2% increase year-on-year, showing growth in both metrics. Gross margin and operating margin improved to 20% and 11%, respectively, with net income attributable to the owners reaching NT$497 million, a 55% increase quarter-on-quarter.
In the first half of 2024, CWE's consolidated revenue was NT$8.274 billion, a 1% decrease year-on-year. The gross margin remained steady at 19%, the same as in 2023. Pre-tax net profit was NT$1.537 billion, a 6% increase year-on-year, with net income attributable to the parent company at NT$817 million, a 1% increase year-on-year.
Notably, Chang Wah Technology (CWTC), a subsidiary specializing in lead frames, also held a board meeting on the same day, approving an expansion plan for its Malaysian facility with a tentative capital expenditure of US$100 million.
CWTC stated that following the inventory adjustment period in 2024, the current capacity of the Malaysian plant is nearly fully utilized. To meet future demand for lead frames from customers, the board approved an investment of US$100 million to expand the Malaysian capacity. This is CWTC's largest investment since the construction of a new plant in Taiwan in 2020.
Since acquiring Sumitomo's overseas lead frame plant in 2017, CWTC has expanded capacities at its Suzhou, China, and new Taiwan plants. Now, it plans to initiate the third phase of capacity expansion. CWTC's global lead frame capacity distribution includes Taiwan, China, and Malaysia, supplying three major packaging clusters in these regions to meet local customer demands.
For the second quarter of 2024, CWTC reported consolidated revenue of NT$2.953 billion, an 8% increase quarter-on-quarter. The gross margin was 25%, and the operating margin was 14%, showing improved performance in both metrics. Net income attributable to the parent company was NT$508 million, a 16% increase quarter-on-quarter and a 5% increase year-on-year. In the first half of 2024, CWTC's consolidated revenue was NT$5.69 billion, a 2% decrease year-on-year, with gross and operating margins at 24% and 13%, respectively. Net income attributable to the parent company was NT$945 million, a 9% increase year-on-year.
Another group subsidiary, JMC, recently benefited from demand driven by major events like the UEFA European Championship and the Olympics. Orders for COF and other panel-related components increased as TV brand channel operators stocked up. July revenue was NT$187 million, a 0.9% month-on-month increase and a 19.66% year-on-year increase, the second-highest monthly revenue in 2024. Cumulative revenue for the first seven months of 2024 was NT$1.254 billion, a 32% increase year-on-year.
Observing the supply and demand in the panel industry, JMC stated that with the stocking up for international events coming to an end, the demand for panel-related industries might cool down. Therefore, they are cautiously optimistic about future COF orders. However, stable shipments of the 2-Metal Micro LED product line are expected to contribute positively to revenue.
