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Chang Wah Electromaterials Inc. (Chang Wah*, 8070.tw) held a board meeting on November 4 and approved several key agenda items, including a cash dividend of NT$0.73 per share for the first half of 2022 and the reviewed consolidated financial report for the nine months ended September 30, 2022. Besides delivering a record-high quarterly earnings per share of NT$1.17, profits of the first three quarters in 2022 had already exceeded the 2021 profits. In addition, the board of directors approved the issuance of convertible corporate bonds for loan repayments.

Major resolutions were summarized as follows:

1. Earnings distribution for the first half of 2022

The board approved a cash dividend of NT$0.73 per share for the first half of 2022 and set December 21, 2022 as the record date and December 15, 2022 as the ex-dividend date. The shareholders’ register will be closed from December 17, 2022 to December 21, 2022 for registration transfer, and the dividend will be paid on January 13, 2023.

In accordance with Chang Wah’s dividend policy of dividend payments on a semi-annual basis, the dividend amount for the first half of the year is based on 50% of the distributable earnings for the same period. With earnings per share of NT$1.64 for the first half of 2022, cash dividend is estimated to be NT$0.73 after deducting 10% of the earnings as legal reserve. In other words, a significant proportion of distributable earnings will fall within the dividend calculation base for the latter half of the year. Consequently, the dividend amount of the second half of the year is significantly higher than that of the first half of the year.

2. Proposal concerning the offering of the fifth unsecured convertible corporate bonds

The board of directors approved the offering and issuance of the fifth unsecured convertible corporate bonds with an amount not to exceed NT$1,200 million for bank loan repayments.

3. Consolidated financial report for the nine months ended September 30, 2022

Consolidated revenue amounted to NT$5,513 million for the third quarter of 2022, with a gross margin of 24% and net profit attributable to owners of the Corporation of NT$796 million. Earnings per share of NT$1.17 for the third quarter was equivalent to a profit of 1.17 times the share capital, hitting a record high for a single quarter.

On a quarter-over-quarter basis, Chang Wah’s consolidated revenue of the third quarter dropped 5% while gross margin went up 1%, which was the second highest figure for a single quarter. Operating margin remained flat at 16% compared to the previous quarter. Pursuant to the conservatism principle, an asset impairment of NT$296 million was recognized on long-term equity investments (at carrying amount plus goodwill) in accordance with IAS 36. However, with foreign exchange gains and dividend income buoying profits, profit before income tax amounted to NT$1,548 million, up 30% from the previous quarter. Net profit attributable to owners of the Corporation surged 48%, setting a new record for a single quarter. On a year-over-year basis, consolidated revenue of the quarter increased by 1% while gross margin, profit before income tax and net profit attributable to owners of the Corporation went up by 3%, 35% and 13%, respectively. 

Chang Wah’s consolidated revenue for the first three quarters of 2022 amounted to NT$16,988 million, a year-over-year increase of 14%. Gross margin and operating margin were 23% and 16%, up 5% and 4 % from last year, respectively. Profit before income tax surged 79% to NT$3,891 million, while net profit attributable to owners of the Corporation equaled NT$1,927 million, a 51% increase compared to the same period last year and exceeding the 2021 profits. Earnings per share of NT$2.81 was equivalent to a profit of 2.81 times the share capital.