Chi Mei Opto Electronics

design Introduction Chi-Mei Optoelectronics (CMO) is a macrocosm- lead-in manufacturing business of TFT-liquid crystal display intro control boards for use in applications much(prenominal) as backdrop monitors, nonebook PCs, and liquid crystal display TVs. The participation was founded on August 6, 1998 and was listed on the principal(prenominal)land China Stock Exchange (stock symbol 3009) in August 2002. As of early 2006, CMO had e preciseplace 15,000 employees world(a). CMO has long cultivated its base at the Tainan Science-Based Industrial Park, where it currently ope evaluate four achievement facilities including 1 3. 5-generation fab, one quarter-generation fab, one twenty percent-generation fab and one 5. -generation fab. To take hold a postgraduate level of war-riddenness and flexibility, CMO is relentless in its investment activities and has aggressive plans for the deployment of its next-generation plants. In entree to capacity expansion plans for its c urrent facilities, CMO is in the process of building its uphold fifth-generation fab, and a juvenile 7. 5generation fab. With its commitment and heavy R&D focus on the luxuriouslyest flavor of in-house self-developed technologies, CMO is able to attract the most magnificent TFT-liquid crystal display R&D talent in the patience.In addition to ongoing innovation in drudgery process technologies, CMO strives to satisfy consumer requirements and expectations for mellow look LCD planks by continually making technology breakthroughs and refinements. CMO is too use to facilitating the foregathering of the Optoelectronics Industry, and has put tremendous lawsuit towards vertical integration with its suppliers. CMO has brought together leading upstream suppliers, including producers of glass substrates, backlight units, polarizing films, cold cathode light lamps and driver integrated circuits.CMO also initiated the Optoelectronics manufacturing cluster in Tree Valley (previousl y cognise as the LCDTV & Industrial Support Park), and has been onward of the curve in localizing the procurement of tell apart components and equipment to enhance supply chain efficiency. This in turn has significantly stimulated the mounting and victimization of Taiwans ripe(p) Optoelectronics Industry. The world is currently entering a new golden era of towering definition digital TV and multimedia.As one of the leading manufacturers in the global LCD-TV panel industry, CMO continues to focus on the development of advanced technology and innovative yields, and administers in the responsibilities of promoting the knowledge-based belief of the digital home. Last year, CMO sack up the 2005 Digital TV Technology assembly in which g overnment representatives and experts from around the world were invited to pct their friendships and visions on the future of the digital home.We at CMO believe it is our duty and duty to satisfy our customers needs and expectations with hi gh quality displays, and to enhance Taiwans social movement in the worlds TFT LCD display industry. Corporate Structure c be Performance 2005 exercise Results In 2005, CMOs panel production set early(a) historical record. Annual panel cargo change magnitude by 90% to 23,685 gee units, while yearbook revenue increased by 49% to NT$152, 844 trillion. Net moolah amounted to NT$ 8,047 meg. Revenue from LCD-TV panels contributed over 40% of one-year deals, with an annual onus of more than 5. one million million million units. Our annual capital expenditure was NT$ 62,018 million. Operation Strategies We expect that the China grocery go out play a very outstanding role in our global mathematical process strategies. Therefore, we established Ningbo Chi Mei Optoelectronics in the second half of 2005, which was a very important first step to follow through CMOs global operation and address reduction strategies. much importantly, Ningbo Chi Me Optoelectronics, as our f irst investment in China, also builds a gooder base for the long-term development of CMO in this competitive TFT-LCD industry.Also, to nominate high quality customer service and maintain close customer relationships, CMO established 2 new subsidiaries, one for each one in Europe and Singapore. Additionally, CMO give invest more aggressively in the technologies of various reportstone input components to protect our company from potency industry- entire shortages. 2006 Operational Goals Buoyed by the expected strong replacement demand and imminent offspring of digital life, the worldwide TFT-LCD grocery store is forecasted to experience strong ingathering and profits in 2006.To strengthen our locating as a leading manufacturer of LCD-TV panels, we entrust occur expanding our production capacity through the upsurge production and ramp up of our second 5G Fab and Ningbo Chi Mei mental faculty assembly plant, as well as achieving higher(prenominal) yields at the 5. 5G Fab and the equipment move-in of the 7. 5G Fab. Meanwhile,CMO leave aggressively invest in the securities industry of key input components to achieve exist reductions in an efficient manner. For 2006, with all our empolyees efforts and innovations, we cod confidence in keeping our position as a leading manufacturer of LCD-TV panels.In addition, we will continue to strive for higher market share in the notebook computers and ground monitors markets. Operational Highlights Business Activities CMOs scope of business includes the research, development, production and sale of TFT-LCD display panels and color filters. 2005 gross sales map Industry overview Due to the dominating technology, modify applications and cost effectiveness, TFT-LCD monitors has become the mainstream product in the flat panel display industry in recent historic period.In 2005, the suppliers of the key components such as backlights, color filters, driver ICs, and polarizers benefited greatly from the strong d emand generated by the throng production of next-generation TFT-LCD fabs. According to DisplaySearch, Taiwans share of worldwide LCD TV panel revenues grew dramatically from 27. 4% in 2004 to 38. 7% in 2005. TFT-LCD is a capital-intensive and technology-intensive industry. The main countries include Taiwan, Korea and Japan. In 2005, LCD TV panels bloomed due to the smooth mass production and ramp up of worldwide ifth generation and above fabs. According to DisplaySearch, the production of LCD TV panels increased to 28 million units in 2005 from 8 million units in 2004. In the past, the main manufacturers focused on competing for higher production capacity. Now, in nine to gain better positioning in the future LCD TV market, the key players are paying more concern to accurate demand predictions, flexible production, and new advanced technologies. Also, the price fluctuations of LCD TV panels sport smoothed out compared to ahead 2005.The following chart is an overview of the TFT- LCD industry R & D Expenditures Short and Long experimental condition Operating Development Plan In 2006, CMO will continuously strive to grow a higher market share in the TFT LCD market and appropriate more change products A. LCD-TV Product CMO will continuously purify our market shares and revenues in this market. Due to the strong demand for LCD TVs, we will propose an extensive product line of full HD panels above 40 to fulfill the demands of our clients.Based on our solid worldwide customer base, CMO will continue to improve the operation performance in each area. Also, CMO will more aggressively explore new business opportunities in developing countries. B. OA Product In 2006, CMO expects to capture 1 to 2% more market share than last year in the desktop monitor and notebook applications. We will offer more competitive wide-format products, and develop 22, 24 and 30 panels for the monitor segment. Also, we will produce notebook panels in our fifth generation fab, which will improve our competitive advantage as well.In 2006, CMO will not only offer more diversified products, but also continuously provide our customers with better service and cooperation in stage to achieve higher a market share in the TFT-LCD industry. Industry evolution forecast DisplaySearch has forecasted the large-sized TFT LCD panel demand in 2006 to consist of 7. 86 million units for notebook computers and 135 million units desktop computer monitors (11. 6 million units for other applications), with respective annual growth rates expected to be 24% and 14%. We produce notebook panels in our 3. , fourth and fifth generation fabs, which can economically cut sizes such as 12. 1, 13. 3wide, 14. 1 and 14. 1wide, 15and 15. 4wide, and 17wide. Monitor panels are produced in our fourth, fifth, and 5. 5 generation fabs, which take a leak economic cutting sizes for 17, 19, 20. 1, 19 wide, 22wide and 24 wide format. CMOs merchandise division expects the LCD TV panel market will reac h almost 43 million units with an annual growth rate of 54% in 2006. More importantly, 32 and above panels will bank bill for more than 40% of the total market.We have strengthened our position in the 20 and above LCD TV market in the past 3 years. Our annual LCD TV panel shipment is more than 5. 5 million units in 2005. CMOs market share in LCD TVs is on par with the devil Korean manufacturers. Our innovative technologies and products have enabled CMO to make significant advances. Manufacturing Process Sales and achievement over the last 2 years Domestic and Export Sales over the last 2 years monetary Analysis of the Last Five historic period Unconsolidated Sales disruption by Application Sales Breakdown by Application Unconsolidated Sales Breakdown by Panel size of it Sales Breakdown by Panel Size