Acer Speeds Up Corporate Transformation by Writing Off Additional NT$1.3B (US$44M) Loss in Raw Materials Inventory and Other Costs in Q4’13
TAIPEI, TAIWAN (2014-01-17)
Q4’13 preliminary financial results: total operating loss NT$8.22B (US$274.39M), EPS NT$-2.8
Acer to enhance product strategy, production planning and inventory control
Senior executives take 30% salary cut to share responsibility
To speed up Acer’s corporate transformation, the company’s Board of Directors approved to write-off losses of NT$1.3B (US$44M) in raw materials inventory and other costs which will be reported in the Q4’13 financial results. This latest write-off will help optimize the company’s operational management. Taking immediate action, Acer will formulate its product strategy with more caution and implement precise production planning and inventory control. Senior executives have also taken voluntary salary cuts of 30% from January to share responsibility.
The Q4’13 financial results are: consolidated revenues of NT$86.7B (US$2.89B) declining by 5.9% quarter-on-quarter, operating loss of NT$8.22B (US$274.39M), after-tax loss of NT$-7.63B (US$-254.79M), and EPS of NT$-2.8. As of the end of Q4’13, Acer’s equity per share is estimated at NT$20.6.
In November last year, Acer already announced the reporting of US$150M for personnel and business restructuring costs in the Q4’13 results. To accelerate the restructuring process, Acer is further recognizing NT$1.3B (US$44M) for raw materials inventory and other costs. In addition, business underperformance and the price reduction of high-end products resulted in the total operating loss of NT$8.22B (US$274.39M) in the fourth quarter.
Acer’s preliminary financial results for the full year of 2013 are: consolidated revenues of NT$360.19B (US$12.03B) down 16.2% year-on-year, operating loss of NT$11.37B (US$379.7M), after-tax loss of NT$20.58B (US$687.11M), and EPS of NT$-7.56.
Acer acknowledges missteps in the past on resource allocation, and the over expectation of ultrabooks and notebooks with touch panel. Although the products were leading in design they did not accurately fulfill market needs.
The spot rate as of January 17, 2014 was used — US$1: NT$29.95.
Acer Inc. consolidated revenues include revenues from other companies in which Acer Inc. has 50% or more ownership, and already deduct any revenues between Acer Inc. and these companies to avoid double counting.