Foxconn 's subsidiary Ennoconn’s FY19 revenue may grow 15-20%

Ennoconn (6414-TW), an industrial computer company owned by Foxconn (2317-TW), held an earnings call today on November 21, 2018. As for Ennoconn’s FY19 outlook, Chairman and CEO Steve Chu said that since the current system integration in the China market has just started, it still has a lot of room for growth. In addition, its technology in Europe and USA operation grows steadily. Therefore, Ennoconn’s FY19 sales is expected to increase by 15-20%.

Chu pointed out that the US-China trade war may slow down China's economy growth. However, as the company acquired Marketech this year and entered China’s system integration market, he believed that the operation in China has just begun and has a lot of room to grow.

Ennoconn is now gradually combining the product line in Suzhou with Marketech’s system integration, promoting the combination of software and hardware to strengthen the layout in China.

Chu believed that another growth momentum in FY19 may derived from S&T, which is responsible for branding business. Catalyzed by the industry of internet and smart manufacturing, related demands are expected to grow. He especially held a positive view on the operation in Europe and USA.  

Based on the revenue contribution from Ennoconn’s subordinates and regional markets, catalyzed by strong S&T brand business, revenue from Europe operation accounts for 47%, the highest in all regions. Moreover, revenue from USA operation accounts for 24%, catalyzed by the contribution from S&T and Goldtek.

Additionly, revenue from China operation accounts for 12%, and the revenue from other Asia Pacific regions accounts for 17%, derived mostly from the contribution of Marketech’s system integration, and another 20%-30% is derived from ODM and JDM.

Ennoconn's 3Q18 revenue was NTD19.981bn (+36.2% QoQ, +68.1% YoY). Its 3Q18 net profit reached NTD335mn (+31.5% QoQ, +19.5% YoY), with EPS of NTD4.35. Ennoconn's 1Q18-3Q18 revenue was NTD45.479bn (+130% YoY). Its 1Q18-3Q18 net profit grow 2% to NTD796mn with EPS of NTD10.38.