BenQ today reported an unexpected huge loss of NT$6.02 billion (US$185.2 million) for the fourth quarter of 2005 due to restructuring costs for the takeover of Siemens’ handset division.
The company posted NT$66.3 billion in consolidated revenues for the fourth quarter, up from NT$34.09 billion in the previous quarter. It recorded net profits of NT$18 million in the third quarter.
BenQ admitted that the loss was more than expected, but said the worst is over. The company expects the synergy from the Siemens’ deal to start driving up BenQ’s business in the first quarter. A significant rebound can be expected in the second quarter, and BenQ will turn a profit in the fourth quarter, the company said.
It is the first time the company has reported a net loss since it was first listed in the Taiwan Stock Exchange in 1996. BenQ said the takeover of Siemens occurred in October with no new products to boost sales in the fourth quarter. BenQ in the fourth quarter was also actively clearing inventories of some low-end and negative-margin handset models, worth NT$1 billion in total, which pushed down margins.
The company also blamed its US operations for its poor fourth-quarter sales, saying it will adjust its strategies and organization in the US market.
