Summary: LCD Supplier AU Optronics in Q3 put out the antitrust-related costs of approximately $ 24 million Taiwan dollars, but because prices continue to rise in the panels offer, increase revenue and lower earnings contribution disposition outside the industry, AU third-quarter profit is expected to be better than the previous quarter. Accumulated earnings per share in the first three quarters will be 0.9 yuan NT.

In Q3, panel maker AU Optronics put out antitrust related costs of approximately $ 24 million Taiwan dollars, but prices continue to rise in the panels offer, increase revenue and lower earnings contribution disposition outside the industry, better than the rumored third-quarter profit season. Accumulated earnings per share for the first three quarters of view 0.9 yuan NT. If also steady in Q4, 2014 EPS estimate of NT $ 1.1~1.3, may be nearly six-year high. Could still keep growing facing the challenge from China Mainland and Korean panel maker? Now it seems the challenge is still great.

             Short-term, AUO remain strength in the fourth quarter. The main reasons include:

First, part of the mainstream of large-size panels offer prices continue to rise. According to market research firm NPD DisplaySearch survey, in October 2014, including 19-inch, 19.5-inch monitor panels, as well as 32-inch, 42-inch TV open cell offer continued modest hike.

New Year's Day and Spring Festival stocking needs about to be released. Although the Chinese LCD TV sales were flat during November, but in the New Year and Spring Festival stocking support, in November-December TV panel shipments are expected to rise. This will help panel plant in the fourth quarter performance will not decline too much.

 However, medium and long term, industrial competitiveness of Taiwan-based panel makers in 2015 is still facing severe. AUO, the main challenge may include:

However, medium and long term, Taiwan panel makers facing competition in 2015 is still grim. AUO example, the main challenge may include:

First, the South Korean panel factory RGBW panel put pressure on the traditional 4K. Although less than 3840 * 2160 RGBW pixels, but the Korean brands have been imported and Chinese brands, including Samsung and LG this year's estimated global TV market share reached 48%, Chinese brand market share continued to climb. Estimated RGBW 4K TV penetration will reach this year, accounting for 1 percent next year, could further erode Taiwan factory pulled directly traditional 4K panel market share. 2013 Taiwan factory 4K panel market share had reached 7-8, 2014 for the second quarter dropped 40 percent, South Korea plant market share approaching 50%.

Second, China and South Korea panel production capacity from their new plants will directly challenge the growth of Taiwan's shipping space. Even if the industry believes that these years, the average LCD TV panel shipments size reaches nearly 39 inches with annual increase of nearly 1.5 inches, 41 inches next year, can help to consume the panel. But Taiwan panel makers in recent years have not release new large-scale production, grow space may be eating by Chinese and Korean manufacturers.

Third, the competition in small and medium-sized panels is still a negative factor. For small and medium-sized panels, AUO originally profit is better, but was impacted from the BOE, Tianma and Japan JDI, since the second half of 2014 prices fell significantly. Anticipated competitive pressures may continue into 2015.

In the first half of 2014, AUO revenues reached about NT $ 195.844 billion yuan, the annual reduction is about 5%, gross margin is 8.9 percent, 1.1 percent annual growth, operating profit is 45 million yuan NT, in the first half net profit after tax is about 4.29 billion yuan NT , 4.7 times by annual growth, earnings per share reached 0.45 yuan NT.

This year's third quarter consolidated revenue reached NT $ 106.889 billion yuan. As part of the mainstream, such as 19-inch large-size panels, 19.5-inch, 32-inch, 50-inch products offer prices continue to rise, although the company has put out in the third quarter, the US antitrust civil litigation related costs of approximately $ 24 million New Taiwan dollars, but it is said in the third quarter profits are still about 50 billion New Taiwan dollars, one quarter of the estimated earnings per share of NT $ 0.5 or so. Total first three quarters of net profit after tax reached 90 billion New Taiwan dollars, earnings per share estimate of nearly NT $ 0.9. 2014 revenue is expected to 400 billion yuan NT, AUO annual EPS estimate of 1.1 to 1.3 yuan NT, 2009 is expected to hit a new high since the past six years.

Translated by TEKSWO Display