Asia300

Hon Hai Precision Industry Co., Ltd.

Taiwan

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May 26, 2017
Prev close: 104.5
May 26, 2017
Market cap:
Market cap(USD):
1,810.85B
60,151.23M
Shares: 17,328.73M

Currency in TWD

Company profile

Market(Ticker): TAI(2317)
Sector:
Industry:
Electronic Technology
Computer Peripherals
Full time employees: --

Business summary

Hon Hai Precision Industry Co., Ltd., manufactures nanotechnology, heat transfer, wireless connectivity and material sciences. The company focuses on nanotechnology, heat transfers, wireless connectivity, material sciences and green manufacturing process. It also provides logistic planning and electronic-supplying system for chain management, computer software development, and computer programming services. Its products include cables, connectors, and personal computer components. The company was founded by Terry Gou on February 20, 1974 and is headquartered in Tucheng, Taiwan

Company background

Hon Hai Precision Industry, the world's largest contract manufacturing company, employs more than 1 million workers in China, its main production base. The company produces smartphones, tablet computers and television sets for clients from around the world. It makes the most of its metal mold technology and low-cost production to deliver new products to customers fast.

The company was set up in 1974 by Chairman Terry Gou. After expanding operations through the connector business, it made a full-scale move into contract manufacturing in the 1990s. Business ties with Apple deepened in the 2000s, and the company grew rapidly thanks to orders from the U.S. electronics giant, primarily for smartphones.

Recently, however, Apple's growth has slowed. Hon Hai has thus been looking to diversify its operations. It entered the telecom market by winning a Taiwan fourth-generation high-speed mobile spectrum license in a 2013 auction. In contract manufacturing too, it aims at expanding the range of items it produces. In June this year, Hon Hai acquired a stake in the robotics subsidiary of Japan's SoftBank. Hon Hai is also looking to relocate some production to India and Southeast Asian countries because of rising labor costs in China. It is also stepping up efforts to automate production at plants by introducing industrial robots.

Chairman Gou is known as a charismatic business executive, but the absence of a successor to him is a problem for the company.

In the news

Financial highlights

Dec 2016

  • Local currency
  • US Dollar
Revenue 4,358.73B
Gross profit 321,584.98M
Operating income 174,939.50M
Income before tax 197,122.29M
Net income 148,662.98M
EBITDA 237,776.39M
Diluted EPS 8.52
Dividends per share --
Total assets 2,592.04B
Total liabilities 1,454.51B
Total equity 1,078.74B
Operating cash flow 190,685.52M

Currency in TWD

Revenue 135,151.15M
Gross profit 9,971.37M
Operating income 5,424.34M
Income before tax 6,112.16M
Net income 4,609.58M
EBITDA 7,372.72M
Diluted EPS 0.26
Dividends per share --
Total assets 80,425.79M
Total liabilities 45,130.70M
Total equity 33,471.38M
Operating cash flow 5,912.58M

Currency in USD

Valuation measures

Dec 2016

PER 9.79
ROA 6.06%
ROE 14.25%
Operating margin 4.01%
Profit margin 3.41%

Key executive

  • Chairman & Chief Executive Officer: Terry Gou
  • Chief Technology Officer & CIO: Ga-Lane Chen
  • President-Business Group, Director & VP: Cheng Wu Tai
  • President-Business Group, Director & VP: Fang Ming Lu
  • Director, President-Business Group & VP: Yi Pin Chien

Share holders

  • GOU TERRY(9.3%)
  • The Vanguard Group, Inc.(2.8%)
  • GIC Pte Ltd. (Investment Management)(2.2%)
  • Saudi Arabian Monetary Agency (Investment Management)(2.0%)
  • BlackRock Fund Advisors(1.9%)
  • Hon Hai Precision Industry Co., Ltd.(1.7%)
  • Norges Bank Investment Management(1.2%)
  • APG Asset Management NV(1.1%)
  • Fidelity Management & Research Co.(1.1%)
  • Abu Dhabi Investment Authority (Investment Management)(1.1%)

Address

  • Website: http://www.honhai.com.tw
  • Address: No. 2, Ziyou Street, Tucheng District, New Taipei City, 23678, Taiwan
  • Phone: +886.2.2268.3466

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