World Class Profitable Growth At Taiwanese Display Producer

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Background

Founded in 2001, AU Optronics Corporation is primarily engaged in designing, producing and selling of thin film transistor liquid crystal displays (TFT-LCD).

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Such displays are used commonly in notebooks, smartphones, TV screens and many other consumer devices.

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AUO is also producing solar modules solutions accounting for a small portion of revenue.

Business Description

Engaged in the research development, production and sale of thin film transistor liquid crystal displays (TFT-LCD) of various types and sizes. Such screens are used in LCD TV, desktop monitors, public information displays, notebooks, tablets, smartphones, car displays and others. The company offers integrated ready-to-install solutions and individually tailored services.

AUO is one of the leading panel producers of LTPS technology enabling high resolution, narrow border, high screen-to-body ratio and lower power consumption. The technology is adopted in smartphones and notebooks.

AU Optronics is one of the leading panel producers of #LTPS #technology

The company is also engaged in the production and sale of solar modules and systems through AUO Crystal Corporation, its 96%-owned subsidiary. It also has 50% share in AUO SunPower Sdn Bhd, a JV in Malaysia. However, this segment contributed only around 7% of revenue in 2016 and noted a small loss.

Around one-third of the total revenue is sourced from the PRC including Hong Kong and a little less than one-third comes from Taiwan.

Leadership

Lee Kun-Yao, founder and chairman of AU Optronics, stepped down from this position in 2015.  He entrusts the Chairmanship to “Paul” Peng Shuang-lang who was the president at the time.

Paul now serves as both the Chairman & CEO of AU Optronics. He has long experience in this industry and joined the company back in 1998. He holds an MBA from Heriot-Watt University, UK.

Lee Kun-Yao, #founder and #chairman of AU Optronics, stepped down in 2015

World Class Benchmarking

Profitable Growth has improved drastically in the past 12 months. AU Optronics ranked among the top 68 of 680 large Information Technology companies globally from being ranked among the worst by the end of 2016.

Profitability and Growth have recently risen significantly to #3 and #1 respectively.

AU Optronics ranked among the top 68 of 680 large #InfoTech companies globally

Asset utilization has been consistently below average at #6. Profit margin improved to #3 from #8 in the past 12 months.

Sales growth and Margin change have not been good in the past few years but improved in the past 12 months. Sales growth improved to average rank from being the worst and Margin change improved to #1 from #8.

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Dr. Andrew Stotz, CFA is the CEO of A. Stotz Investment Research, a company providing institutional investors with ready-to- invest portfolios in Asia that aim to beat the benchmark through superior stock selection. The company also provides buy- and sell-side clients with financial models to value any company in the world and World Class Benchmarking to determine what companies are financially world class. Previously, as Head of Research at CLSA, Andrew was voted No. 1 Analyst in Thailand in the Asiamoney Brokers Polls for 2008 and 2009. He was also voted No. 1 Analyst in Thailand in the 2009 Institutional Investor magazine All-Asia Research Team Report. Andrew earned his PhD in finance at the University of Science and Technology of China in Anhui province, with a focus on answering questions raised by fund managers and analysts during his career about picking stocks and managing portfolios. In addition, Andrew has been a lecturer in finance for 22 years at various universities in Thailand. Since 2013, he has been the president of the CFA Society of Thailand. He is also the author of How to Start Building Your Wealth Investing in the Stock Market.