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Electronic Technology

Hon Hai Precision Industry Co., Ltd.

  • 71.40 TWD
  • -0.60
  • -0.83%
  • Taiwan
    Aug 16, 2019
  • Ticker
    TAI(2317)
  • Prev. close
    72.00
  • Market cap (TWD)
    998,135M
  • Market cap (USD)
    31,827.30M
  • Shares
    13,863M

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.

Business Summary

Hon Hai Precision Industry Co., Ltd. engages in the design, development and manufacture of nanotechnology, heat transfer, wireless connectivity and material sciences products. 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.

Financial Highlights

Dec 2018 TWDUSD
Revenue5,293.80B175,556.20M
Gross Profit332,029.90M11,010.97M
Operating income136,146.87M4,514.98M
Income before tax154,019.72M5,107.69M
Net income129,065.10M4,280.13M
EBITDA195,334.67M6,477.80M
Diluted EPS9.190.30
Dividends Per Share40.13
Total Assets3,381.35B110,009.29M
Total liabilities2,045.58B66,551.38M
Total equity1,211.87B39,427.35M
Operating cash flow-25,748.60M-853.89M
Currency in TWDCurrency in USD

Historical Data

 Dec 2014Dec 2015Dec 2016Dec 2017Dec 2018
Revenue 4,213.17B 4,482.14B 4,358.73B 4,706.73B 5,293.80B
Gross Profit 291,943.85M 320,591.96M 321,584.98M 303,006.94M 332,029.90M
Operating income 143,191.41M 164,268.57M 174,939.50M 112,570.43M 136,146.87M
Income before tax 171,140.35M 194,129.97M 197,122.29M 172,055.87M 154,019.72M
Net income 130,534.72M 146,866.97M 148,662.98M 138,734.40M 129,065.10M
EBITDA 213,423.26M 235,107.03M 237,776.39M 173,002.89M 195,334.67M
Diluted EPS 9.46 10.57 10.65 9.88 9.19
Dividends Per Share 4.11 4.54 5.62 2.50 4
Total Assets 2,462.71B 2,308.29B 2,592.04B 3,407.21B 3,381.35B
Total liabilities 1,474.07B 1,243.49B 1,454.51B 2,232.87B 2,045.58B
Total equity 930,231.23M 1,007.62B 1,078.74B 1,083.12B 1,211.87B
Operating cash flow 202,744.41M 259,174.72M 190,685.52M -18,834.07M -25,748.60M
 Dec 2014Dec 2015Dec 2016Dec 2017Dec 2018
Revenue 139,033.83M 141,151.85M 135,151.15M 154,711.26M 175,556.20M
Gross Profit 9,634.08M 10,096.09M 9,971.37M 9,959.89M 11,010.97M
Operating income 4,725.28M 5,173.14M 5,424.34M 3,700.21M 4,514.98M
Income before tax 5,647.59M 6,113.54M 6,112.16M 5,655.50M 5,107.69M
Net income 4,307.61M 4,625.13M 4,609.58M 4,560.22M 4,280.13M
EBITDA 7,042.92M 7,403.99M 7,372.72M 5,686.63M 6,477.80M
Diluted EPS 0.31 0.33 0.33 0.32 0.30
Dividends Per Share 0.13 0.14 0.17 0.08 0.13
Total Assets 77,929.07M 70,274.29M 80,425.79M 114,495.58M 110,009.29M
Total liabilities 46,645.04M 37,857.30M 45,130.70M 75,033.31M 66,551.38M
Total equity 29,435.83M 30,676.46M 33,471.38M 36,397.05M 39,427.35M
Operating cash flow 6,690.52M 8,161.93M 5,912.58M -619.07M -853.89M

Valuation Measures

Dec 2018
PER7.60
ROA3.80%
ROE11.24%
Operating margin2.57%
Profit margin2.43%

Key executives

  • Chief Financial Officer: Huang Chiu-lien
  • Deputy General Manager: Yi Pin Chien
  • Head-Accounting: Tsung Kai Chou
  • Spokesman: Chih Ping Hsing

Shareholders

  • GOU TERRY (11.9%)
  • The Vanguard Group, Inc. (3.0%)
  • BlackRock Fund Advisors (2.1%)
  • GIC Pte Ltd. (Investment Management) (1.7%)
  • Hon Hai Precision Industry Co., Ltd. (1.4%)
  • Fubon Life Insurance Co., Ltd. (1.2%)
  • Fidelity Management & Research Co. (1.1%)
  • Saudi Arabian Monetary Agency (Investment Management) (1.1%)
  • Norges Bank Investment Management (1.1%)
  • BlackRock Japan Co., Ltd. (0.9%)

Contact Details

  • Website:http://www.honhai.com.tw
  • Address: No. 2 Tzu Yu Street, Tucheng District, New Taipei, 236 78, Taiwan
  • Phone: +886.2.2268.3466

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Competitors

  • Sanmina-SCI Corporation
  • Benchmark Electronics, Inc.
  • Jabil Inc.
  • Celestica Inc.
  • Universal Scientific Industrial (Shanghai) Co., Ltd. Class A
  • ASE Technology Holding Co., Ltd.
  • Arlo Technologies, Inc.
  • Boxlight Corp Class A
  • UDE Corp.
  • Guangdong Silver Age Sci & Tech Co., Ltd. Class A
  • NETGEAR, Inc.
  • Ledtech Electronics Corp.
  • G-SHANK Enterprise Co., Ltd.
  • Lumentum Holdings, Inc.
  • Aerospace Communications Holdings Co., Ltd. Class A
  • Kortek Corporation
Last Updated on 16 Aug, 2019

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