Near half of South Korean display equipment makers have recorded operating loss during the second quarter of the year.
TheElec collected data of 30 related companies, with 13 of them reporting operating loss during the quarter.
Meanwhile, nine of of the 30 companies that made a profit saw their earnings contract. Only eight companies out of the total reported growth.
Samsung Display and LG Display are spending conservatively in their facilities this year, which is the likely cause of the slowdown in growth for the equipment makers.
Bucking this trend, Wonik IPS posted 432.5 billion won in sales and 100.7 billion won in operating income, an increase of 42.6% and 96.7%, respectively, from the previous year.
Out of the total sales, 368 billion won came from its chip equipment and 65 billion won came from display equipment.
Sales from display equipment increased by 20 billion won from the previous year __ those from chip equipment jumped by over 100 billion won.
However, for the entire year of 2021, Wonik IPS expects sales from display equipment to contract. In March, the firm said it expected the business to contract by up to 25% from the previous year.
The company mainly supplies dry etchers to Samsung Electronics and Samsung Display.
Meanwhile, Top Engineering recorded 252.2 billion won in sales, a 10.3% year-on-year decline. It recorded 200 million won in operating loss. Its subsidiary Power Logics’ poor performance dented its results. The subsidiary supplies camera modules to Samsung and has recently won Hyundai and Kia as indirect customers. The firm mainly supplies display equipment to LG Display.
AP Systems posted 145.7 billion won in revenue and 16.2 billion won in operating income, an increase of 13.4% and 84.1%, respectively, from a year ago. The company said its chip equipment business and cost control helped the growth. Its new rapid thermal processor used in semiconductor production contributed 26.3 billion won in sales.
Besides Top Engineering, Philoptics, HB Technology, Toptec, Charm Engineering, YEST, JAS Tech, LIS, FNS Tech, HIMS, Finetek, Youngwoo DSP and YES recorded operating loss during the second quarter.
Toptec’s operating loss rate was 109.5%, the worst out of the companies. The firm has in recent years lost Samsung Display as a customer due to alleged technology leaks.
Local and global display panel makers are expected to spend conservatively this year.
LG Display announced a 3.3 trillion won spending plan for OLED panels, but this will be executed up to 2024. Samsung Display is looking to transfer its L7-2 liquid crystal display line into those for Gen 6 OLED panel. BOE is focusing on improving its existing OLED lines to increase yield rates.