Teco Electric & Machinery : 2015/08/13 TECO Announces 2Q15 Results

TECO Electric & Machinery Co., Ltd.

5F, 19-9, San Chong Road, Nan-Kang, Taipei 115, Taiwan

Tel: [phone] | Fax: [phone] | http://www.teco.com.tw

TECO Announces 2Q 2015 Results

Taipei, Taiwan, August 13th 2015 - TECO Electric and Machinery Co., Ltd., a leading manufacturer and service provider of motors, home appliances and information technology, today announced its financial results for 2Q 2015.

Consolidated Basis Unit: NT$1,000

Period Item	2Q 2015	vs. 2Q 2014 (+/-%)	vs. 1Q 2015 (+/-%)	1H 2015	vs. 1H 2014 (+/-%)
Operating Revenue	12,159,518	-14.5%	3.8%	23,875,832	-13.9%
Gross Profit, net	3,067,055	-14.7%	0.3%	6,124,116	-11.1%
Operating Profit	902,872	-33.5%	-8.5%	1,889,555	-25.8%
Income Tax Expense	287,378	-34.1%	0.0%	574,762	-28.9%
Net Income(1)	912,961	-37.9%	23.9%	1,650,067	-29.2%
EPS(NT$)	0.46	0.83

(1) Excluding non-controlling interests.

Please find the details in the following pages.

1

For the second quarter of 2015, net revenue totaled NT$12,160 million and gross profit was NT$3,067 million. Operating profit came in at NT$903 million and net income was NT$913 million. Earnings per share was reported as NT$0.46.
Recurring operating revenue decreased by 14.0% as opposed to 2Q'14. Gross profit and operating profit decreased by 14.7% and 33.5% respectively. Net income decreased by 37.9%. The decrease in non- operating income was mainly due to the decrease in gain on disposal of property, plant and equipment in 2Q14. (See table 1)

Table 1

(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	2Q ' 15 (3) 2Q ' 14(3) YoY % Amount % Amount %
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	12,159,518 100.0% 14,215,523 100.0% -14.5% 12,153,929 100.0% 14,140,253 99.5% -14.0% 5,589 0.0% 75,270 0.5% -92.6% (9,090,698) -74.8% (10,622,297) -74.7% -14.4%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	3,067,055 25.2% 3,594,089 25.3% -14.7% (2,164,183) -17.8% (2,235,549) -15.7% -3.2%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	902,872 7.4% 1,358,540 9.6% -33.5% 377,554 3.1% 645,261 4.5% -41.5% 401,031 3.3% 239,230 1.7% 67.6% (25,533) -0.2% 416,819 2.9% - (46,475) -0.4% (57,741) -0.4% -19.5% 48,531 0.4% 46,953 0.3% 3.4%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	1,280,426 10.5% 2,003,801 14.1% -36.1% (287,378) -2.4% (435,920) -3.1% -34.1%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	912,961 7.5%1,470,149 10.3% -37.9%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	0.46 0.74

Note:

(1) Unrealized / realized gain on inter-affiliate accounts included. (2) Excluding non-controlling interests.

(3) Comply with IFRS.

2

Recurring operating revenue for 2Q'15 increased 4.7% over 1Q'15. Gross profit increased by 0.3% while operating profit decreased by 8.5%. Net income increased by 23.9%. The increase in non-operating income was mainly due to the increase in dividend income in 2Q15. (See table 2)

Table 2

(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	2Q ' 15 (3) 1Q ' 15 (3) YoY % Amount % Amount %
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	12,159,518 100.0% 11,716,314 100.0% 3.8% 12,153,929 100.0% 11,611,465 99.1% 4.7% 5,589 0.0% 104,849 0.9% -94.7% (9,090,698) -74.8% (8,665,295) -74.0% 4.9%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	3,067,055 25.2% 3,057,061 26.1% 0.3% (2,164,183) -17.8% (2,070,378) -17.7% 4.5%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	902,872 7.4% 986,683 8.4% -8.5% 377,554 3.1% 122,264 1.0% 208.8% 401,031 3.3% 182,502 1.6% 119.7% (25,533) -0.2% (59,340) -0.5% -57.0% (46,475) -0.4% (47,709) -0.4% -2.6% 48,531 0.4% 46,811 0.4% 3.7%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	1,280,426 10.5% 1,108,947 9.5% 15.5% (287,378) -3.1% (287,384) -2.5% 0.0%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	912,961 10.3% 737,106 6.3% 23.9%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	0.46 0.37

Note:

(1) Unrealized / realized gain on inter-affiliate accounts included. (2) Excluding non-controlling interests.

(3) Comply with IFRS.

3

For the second half of 2015, operating revenue totaled NT$23,876 million and gross profit was NT$6,124 million. Operating profit came in at NT$1,890 million and net income was NT$1,650 million. Earnings per share was reported as NT$0.83.
Recurring operating revenue decreased by 13.8% as opposed to 1H'14. Gross profit and operating profit decreased by 11.1% and 25.8% respectively. Net income decreased by 29.2%. The increase in non-operating income was mainly due to the decrease in gain on disposal of property, plant and equipment in 2Q14. (See table 3)

Table 3

(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	1H ' 15 (3) 1H ' 14 (3) YoY % Amount % Amount %
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	23,875,832 100.0% 27,740,150 100.0% -13.9% 23,765,394 99.5% 27,569,267 99.4% -13.8% 110,438 0.5% 170,883 0.6% -35.4% (17,755,993) -74.4% (20,855,862) -75.2% -14.9%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	6,124,116 25.6% 6,885,682 24.8% -11.1% (4,234,561) -17.7% (4,338,973) -15.6% -2.4%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	1,889,555 7.9% 2,546,709 9.2% -25.8% 499,818 2.1% 780,731 2.8% -36.0% 583,533 2.4% 351,086 1.3% 66.2% (84,873) -0.4% 422,298 1.5% - (94,184) -0.4% (118,339) -0.4% -20.4% 95,342 0.4% 125,686 0.5% -24.1%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	2,389,373 10.0% 3,327,440 12.0% -28.2% (574,762) -2.4% (808,415) -3.4% -28.9%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	1,650,067 6.9% 2,331,404 8.4% -29.2%
(In NT$1,000, except EPS) Operating Revenue Recurring Operating Revenue Gain on Sales of Financial Assets Operating Costs Gross Profit, net (1) Operating expenses Operating Profit Non-operating Income (Expense) Other Income Other Gains and Losses Financial Costs Share of Profit (Loss) of Associates and Joint Ventures Accounted for Using Equity Method Income before Tax Income Tax Expense Net Income (2) EPS	0.83 1.18

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Table 4

June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	June 30, 2014
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	15,417,110 14,292,181 11,067,460 3,209,894
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	43,986,645 12,866,672 5,198,992 19,490,802
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	37,556,466
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	81,543,111
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	22,605,375 1,443,300 4,127,692 4,186,676
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	9,757,668
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	32,363,043
June 30, 2015 Mar 31, 2015 (In NT$1,000) Cash & Cash Equivalents 15,435,742 15,089,115 Receivables 12,077,787 11,695,759 Inventories 11,364,491 11,346,602 Other Current Assets 3,267,607 3,276,139 Total Current Assets 42,145,627 41,407,615 Financial Assets Available for sale - Non Current 12,711,851 12,796,759 Long-Term Investments Under Equity Method 5,233,135 5,244,017 Other Non-Current Assets 19,673,485 19,666,389 Total Non-Current Assets 37,618,471 37,707,165 Total Assets 79,764,098 79,114,780 Current Liabilities 20,122,931 16,267,582 Bonds Payable 3,000,000 1,513,200 Long-Term Borrowings 1,385,135 4,333,160 Other Non-Current Liabilities 4,251,683 4,276,025 Total Non-Current Liabilities 8,636,818 10,122,385 Total Liabilities 28,759,749 26,389,967 Total Shareholders' Equity(1) 51,004,349 52,724,813	49,180,068

(1) Including non-controlling interests.

About TECO Electric & Machinery Co., Ltd.

TECO Electric & Machinery Co., Ltd. (TSE 1504) was founded in 1956 and has since been well known as one of world's leading motor-manufacturers. For 50 years and running, TECO has now engaged in various business sectors ranging from Industrial Products, Home Appliances, Mechanical and Electrical Construction, Key Components Manufacturing and Information Technology. Teco's consolidated revenue was NT$53.8 Billion for the 2014 fiscal year. More information is available at http://www.teco.com.tw

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