The Capital Expenditure In The Cold And Winter Of The Lcd Display And The Large Factory Of The Taiwan And South Korea

- Nov 06, 2019-

Due to the fact that the price of LCD panel has been generally lower than the cost of cash, coupled with the poor terminal demand caused by the Sino-US trade war, the losses of veneer operators continue to expand. In addition to reducing the utilization rate of production capacity, looking forward to improving supply and demand and stabilizing prices, manufacturers have also taken clothing reduction and dieting measures. Recently, Taiwan and South Korea panel factories have reduced capital expenditure, including Lokin display (LG Display), Youda and Qunchuang, etc., operators do not want to manage expenses by controlling expenses. To survive a cold and cold winter.


Due to the decline in panel prices and the reduction in capacity utilization, the loss in the industry expanded to 437 billion won (about NT $12.4 billion) in the third quarter, and the net loss after tax reached 442 billion won (equivalent to about NT $12.5 billion). In the first three quarters, the loss of Legin display exceeded NT $1 trillion, close to NT $30 billion, making it the largest loss of large size panels in 2019.


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In this case, Legin display announced a reduction of 500 billion won in capital expenditure, as well as plans to reduce the production capacity of LCD TV panels. In the future, Legin display will focus on the development of OLED panels, including large size and flexible OLED panels, hoping to jump out of the harsh environment in which the LCD panel is oversupplied. Youda also did not perform well in the third quarter, although shipments increased compared with the second quarter, but were affected by the drop in panel prices. 


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The net loss to the owners of the parent company in the third quarter was NT $3.99 billion, with a cumulative net loss of more than NT $10 billion, or 10.36 billion yuan in the first three quarters of 2019.


Looking forward to the fourth quarter, Youda said that entering the traditional off-season of the panel industry, it is expected that the imbalance between supply and demand will continue for some time. Youda will moderately adjust capacity utilization in the fourth quarter and use the off-season to accelerate the development of new products in 2020. 


In addition, Youda will continue to carry out value transformation and technological innovation, actively open up the added market, enlarge the profitable product line, but also strictly control costs and strengthen cash flow to tide over the low tide of the industry. 


Youda's strict control of fees also includes capital expenditure. Youda said at the law conference that capital expenditure in the third quarter was 7.4 billion yuan, compared with 23.6 billion yuan in the first three quarters. The company originally planned capital expenditure of 40 billion yuan in 2019, but has now been reduced to 32 billion yuan, a reduction of 8 billion yuan.