2005 Annual Report(PDF/2823KB)

Transcription

Information updated to 2006.04.20
Key figures
Year
Sales Revenue
Net Income
Unit: NT$ million
2001
2002
2003
2004
2005
58,820
93,229
108,699
147,770
124,407
3,031
7,400
7,500
7,619
(5,226)
5
8
7
5
(4)
Net Margin (%)
Retroactively Adjusted Earnings Per Share (NT$/share)
Net Asset Value
1.32
3.08
3.03
3.10
(2.12)
28,141
41,278
45,462
49,078
44,431
Note: All financials are non-consolidated figures (Taiwan parent company level)
Message To Our Shareholders
Dear Esteemed BenQ Shareholders,
BenQ announced in June 2005 it will acquire Siemens AG’s mobile handset business (Siemens MD) in an acquisition that
successfully propelled BenQ onto the global stage as a renowned brand.
Following the closing of the acquisition, we began our first step in Q4 of 2005 when the Company incurred a net loss of 5.2
billion NT$ in 2005, translating to a loss of 2.12 NT$ per share on revenue of NT$ 162.3 billion on consolidated basis. Since
fourth quarter 2005, we have worked seamlessly with our Germany-based co-workers and re-enforced managerial resources
in areas where BenQ has a strong comparative advantage. In a truly complementary merger of mobile handset assets
without breaking our stride, we introduced twelve breathtaking new handsets in Q1 of 2006. Since October, the Company
has undertaken restructuring initiatives to cut costs, to accelerate time-to-market for new products, and to restore customer
confidence. I believe our initial efforts have resulted in a successful repositioning of the newly launched BenQ-Siemens
brand. We are confident BenQ-Siemens will be synonymous with leadership in multimedia innovation, attractive styling and
form factors, and potent lifestyle benefits. With the twelve new handsets and others to come, order books should continue to
strengthen along with profit contribution.
e Company’s various major product lines continued their strong performance in 2005. BenQ’s LCD displays lead the industry
in quality and functionality leveraging our advanced display technology and vertical integration within our business group. In
a year when we continued topping previous shipment totals, BenQ gained significant market share to solidify the Company’s
position as a global top three manufacturer of LCD displays. In some countries, notably Brazil, Russia, India, and China, BenQ
has become the leading name in the display market. In the projector product space, BenQ’s projectors ascended to the number
top two spot in sales globally in the fourth quarter of 2005. e company’s success in projector business is anchored by our
industry-leading technology, short time-to-market and effective channel strategy.
Continuous innovation has always been central to BenQ's corporate strategy, and we intend to continue creating world-class
products with designs that captivate consumers’ imagination. In March 2006, BenQ received 17 major design distinctions—
third highest total in the world—at Germany’s prestigious iF Design Award. In total, BenQ received 125 major international
design awards in the last four years. Leveraging BenQ’s design prowess and Germany’s heritage in engineering and precision
cramanship, we believe BenQ-Siemens will continue to captivate the world with creativity and quality. Reflecting the
Company's commitment to innovation, BenQ has allocated about 3% of sales to research & development over the past five years
and currently holds approximately 3000 global patents.
On the outside, the Siemens MD acquisition catapulted BenQ onto the world stage. On the inside, the quest for greater focus
and profitability is never ending. In April 2006, the company formed a strategic alliance with Lite-On IT through manufacturing
integration in optical storage products, bringing together two of the industry’s leading players and enhanced the overall
competitiveness of Taiwan’s storage sector. Our management team aims to continue streamlining business processes, driving
better focus and higher profitability.
Although the initial integration period at BenQ Mobile is not without pain, we are very upbeat about the initial synergies. Our
journey to build a global brand has not been possible without your support. We have the conviction that directing the Company
away from the hyper-competitive forces of the ODM business model was the right thing to do. Whichever the corporate
direction, we have never let out of our sight the principal objective when it comes to taking care of shareholders: to generate
solid returns.
As we look ahead to 2006 and beyond, we expect both the profit-and-loss accounts and balance sheet to strengthen over time,
and when they do, return-on-equity and cash flow generation should improve significantly. We thank you for your continued
support!
Yours sincerely,
K.Y. Lee - Chairman
Sheaffer Lee - Chief Operating Officer
2005 Annual Report
1
Table of Contents
01
Table of Contents
02
Corporate Strategy
03
Review of Operations and Product Strategy
11
Corporate Governance
30
Company Financials
38
Contact Information
BENQ CORPORATION
Headquarters / Taoyuan Plant
157 Shan-Ying Road, Gueishan, Taoyuan 333, Taiwan, R.O.C.
Phone: 886-3-359-8800
Taipei office
18 Jihu Road, Neihu, Taipei 114, Taiwan, R.O.C.
Phone: 886-2-2799-8800
INVESTOR RELATIONS CONTACTS
Spokesperson
Eric ky Yu
VP- CFO
Phone: 886-3-359-8800
investor@BenQ.com
Deputy Spokesperson
Jasmin Hung / David W Huang
Controller / Senior Manager of Finance
Phone: 886-3-359-8800
investor@BenQ.com
BENQ ON THE INTERNET
BenQ’s Investor Relations home page on the worldwide website
offers a wealth of corporate information, including the latest annual
report and financial results.
Website: BenQ.com/ir.htm
REGISTRAR & TRANSFER AGENT
SinoPac Securities
3F, 53, Po Ai Road, Taipei 100, Taiwan, R.O.C.
Phone: 886-2-2381-6288
http://www.sinopacsecurities.com
INDEPENDENT ACCOUNTANTS
Wu Kuo-Feng & Wang Ming-Jhy, CPA
KPMG Peat Marwick
6th Fl., No. 156, Sec.3, Min-Sheng East Road, Taipei 105, Taiwan,
R.O.C.
Phone: 886-2-2715-9999
http://www.kpmg.com.tw
DOMESTIC STOCK EXCHANGE LISTING
BenQ Common shares
Taiwan Stock Exchange Corporation
http://www.tse.com.tw/en/
OVERSEAS SECURITY EXCHANGE LISTING
For further information, visit BenQ worldwide website and login at
Investor Relations
BenQ Global Depositary Shares
Luxemburg Stock Exchange
ISIN: US0823012010
http://www.bourse.lu
BenQ Euro Convertible Bonds
Luxemburg Stock Exchange
ISIN: UX0124567602
http://www.bourse.lu
2
2005 Annual Report
Corporate Strategy
Corporate Strategy
Projector PE7700
BenQ enters 2006 a better known brand in many Asia Pacific and European markets. e company is building its
5C strategy (computing, communications, consumer electronics, crystal & component, cool brand & caring) to
better address market trends and consumers’ digital lifestyle needs. At BenQ, we believe the new digital lifestyle
is being shaped by the meeting of opposites. No where is the new digital lifestyle more obvious than where work
meets play, and where style fuses with function; where connectivity is married with mobility, and where here
mixes with there; where the familiar is united with the unexpected, and where technology and enjoyment merge to
become one.
Since the inception of the BenQ brand four years ago, BenQ has achieved its initial goals of high growth and
awareness.
In 2005 BenQ introduced a new entrant onto the global stage, BenQ Mobile, in the mobile handset industry when
BenQ acquired Siemens AG’s mobile devices business group.
We believe this new combination of precision German crasmanship and digital enjoyment will power BenQSiemens’ unique growth platform. Having achieved its goals of awareness building in many key markets, BenQ
now enters a new phase of growth with the goal of becoming a brand that consumers prefer.
2005 Annual Report
3
5C Corporate Strategy
5C Strategy Better Addressing Market Trends and Consumer Digital Lifestyles
5C
For a number of years, BenQ has been developing leading–edge products consistent with the company's computingcommunications-consumer electronics (3C) roadmap. Today, BenQ is one of a few Asian brands expanding beyond the 3C
technology arena; BenQ's business/product strategy now incorporates two additional elements-- BenQ's crystal TFT LCD
technology and cool branding -- to make up what we call the 5C strategy.
We are optimistic that BenQ's 5C strategy will enable the company to better address multimedia convergence trends, which we
believe will center on three applications having one common element in the crystal TFT LCD technology: mobile phone, laptop
computer, and television.
With crystal TFT LCD technology playing an essential role in all these applications and BenQ's group of companies possessing
Know-how on key component technologies, BenQ is well positioned to realize 5C vision of building a cool brand strong on
lifestyle benefits, leveraging strong core technological strengths.
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2005 Annual Report
Corporate Strategy
Meeting of Opposites
BenQ's Design Philosophy
To fulfill BenQ’s vision of "Bringing Enjoyment and Quality to Life," BenQ established its Lifestyle Design Center (LDC) focused
on delivering better designs and technology to meet consumer demands.
BenQ’s design philosophy highlights harmony in the "Meeting of Opposites" and optimal fusion of functional and emotional
benefits. BenQ extracts the essence of the Western & Asian culture, philosophy, architecture and artifacts, and infuses it with
modern occidental design composition to create a unique design language.
Winner of 125 global awards in the past four years, BenQ is establishing itself as a leader in industrial design and positioned to
score winning impressions.
- BenQ Lifestyle Design Center
"If we could test design on a temperature meter, we would find modernism or rationalism on the extreme cold side and postmodernism on the extreme hot side."
- Andrea Branzi, highly respected Italian architect/designer
BenQ design, staying abreast of lifestyle trends and moving swily between the extremes of hot and cold, seeks the most optimal
temperature.
2005 Annual Report
5
BenQ-Siemens Visual Identity - Squound
Square + Round
e BenQ-Siemens visual identity is to present the best combination of both brand values (German heritage engineering and
Designing enjoyment) and strengthen the joint brand with instantly recognizable visuals for the brand migration period.
A synthesis of square (stands for Siemens' rational values) and round (stands for BenQ's organic, emotional values), the
Squound represents that two companies fusing their respective traits to the market and the consumer: East meets West.
e Squound is not only purely decorative but always has a function. It must be attached to one of the most important elements in
the page, e. g. the headline, the product name, the product, etc.
2D Squound is used for restricted purposes and as a base for layout development while 3D Squound is used whenever applicable.
Squound is the special identity that represents the connection of these two brands and will be used for mobile phone product line
only.
A set of category patterns for BenQ-Siemens were developed based on BenQ's existing patterns, but has been made more dynamic
and more recessive in color to communicate the new sophistication and technology that BenQ-Siemens offers.
2D Squound
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2005 Annual Report
3D translucent Squound
Corporate Strategy
Keep Exploring
Technology meets enjoyment
For our new age digital denizen, life flows seamlessly from one new experience to another. And while enjoyment always matters,
our vision now pushes it to the next level. Where the old distinctions between work and play, global and local, young and old get
blurred. Where styles fuses with functionality, where connectivity is married with mobility, where technology and enjoyment
finally merge to become one. Aer all, when opposites embrace, walls are torn down setting you free to explore totally new
experiences in digital living.
With the strategic acquisition of the Siemens mobile division, BenQ is poised for the next level in global leadership, powering
the 3Cs of digital convergence. e acquisition perfectly represents BenQ's design philosophy - “meeting of opposites”;
combining Siemens' engineering reliability with BenQ's acclaimed design innovativeness. e perfect synergy of BenQ's
youthful dynamism and Siemens' technological trust; blending BenQ's strengths in connectivity & display technology, with
Siemens' wireless & GPRS portfolio. And it reflects the core BenQ philosophy of looking at constant integration of opposites to
challenge conventions and create breakthrough ideas.
Exploring possibilities of 3C lifestyle
e sheer spirit of exploration has the power to change worlds. is is why BenQ constantly strives for innovative ways to
enhance people's lifestyles into 3C digital spheres – communication, consumer electronics and computing. One of the fastest
growing spheres is communications, making it the driving force behind BenQ's recent acquisition of Siemens' mobile devices
business group.
It's this unique explorative spirit that will drive us into the future. Our brand personality embodies these very values: to be
challenging in a way that breaks conventions, to be original such that we deliver the unexpected, to be authentic in terms of
simplicity and reliability, to be vibrant in our dynamism and design, and most importantly, to be joyful, so that every new BenQ
product delights you with freshness.
Fusing lifestyle with design
BenQ's product design is based on the simple belief that technology too must have a human soul. BenQ sees technology
products not just as a functional tool, but as a symbol of the user's individuality & lifestyle.
And as with everything else in BenQ, BenQ's product design reflects the harmony of opposites. Blending subtle minimalism
with touches of luxury, BenQ extracts the essence of Asian design fluidity and infuses it with modern Western technology. us
creating an elegant design language that's totally unique to BenQ.
Bringing enjoyment & quality to life
As one of the rare few technology brands with a complete portfolio in the three areas of Computing, Communications and
Consumer Electronics, only BenQ can make this vision come alive. So switch on the enjoyment and keep exploring.
BenQ promises to make every experience of networked personal electronics an enjoyable one. Because we believe enjoyment
comes when people experience and explore more. When they can create, share and achieve more using better tools and
technologies. When they truly fulfil their true potential.
is is why BenQ keeps exploring and pushing every boundary in all areas of 3C Lifestyle Enjoyment, to truly brings enjoyment
and quality to life.
2005 Annual Report
7
BenQ Group-Sharing Resources and
Leveraging Synergy
BenQ Group
AU Optronics
Darfon Electronics
■Digital Media Business
■TFT-LCD Modules
■Keyboard & Mouse
■Mobile Business
■PDP Modules
■Fine Ceramic Power Devices
■Computing Products Business
■OLED/LTPS
■Inverters
■Telecommunication components
Daxon Technology　Cando　Raydium
■Storage Media/Polarizers
■Color filters for TFT-LCD displays
■TFT-LCD driver IC solution provider
Airoha Technology
PBDS
BenQ GURU Soware
■RF/mixed signal IC
■Digital Media
■E-Business Solutions & Services
■Solutions for wireless applications
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2005 Annual Report
America
Germany
Japan
Germany
China
Corporate Strategy
125 International Design Awards
America
2005 Annual Report
9
iF Design Award 2006
Seventeen BenQ lifestyle designed products will receive the prestigious 2006 iF Design Award for design excellence,
including a BenQ scanner which will also receive iF International Forum Design’s top honor, the Gold Award. e addition
of the 17 iF awards brings BenQ’s total number of iF Awards to 35.
BenQ expects to reposition itself as an industry leader and secures leadership in innovation, leadership in design and user
experience, and leadership in multimedia and applications since BenQ's acquisition of Siemens' mobile devices business group.
e iF Design Award is deemed as one of the most significant design competitions worldwide.
BenQ design philosophy "Meeting the Opposite" is focused on enhancing the consumers' lifestyles by incorporating both
functional and emotional elements into our product designs.
10
Mobile Phone
BenQ M580
Mobile Phone
BenQ-Siemens S81
Mobile Phone
BenQ-Siemens S88
Mobile Phone
BenQ-Siemens E61
Mobile Phone
BenQ-Siemens CF81
Mobile Phone
BenQ-Siemens CL71
Mobile Phone
Siemens CF110
Mobile Phone
Siemens SL75
Mobile Phone
Siemens AX75
Digital Camera
BenQ DC E520
Digital Camera
BenQ DC X610
Wireless Optical Mouse
BenQ M530
LCD Monitor
BenQ FP72V
LCD Monitor
BenQ FP93V
LCD TV
BenQ VL3231
Scanner
BenQ 7350CT
Pocket Writer
BenQ PW100
2005 Annual Report
Review of
Operations and Product Strategy
Operations and Product Strategy
BenQ-Siemens S88
■Mobile Business Group
■Computing Products Business Group
■Digital Media Business Grorp
2005 Annual Report
11
Mobile Business Group
ings change for the better through exploration. BenQ is constantly striving for innovative ways to enhance people's
lifestyles in 3C digital sphere – communication , consumer electronics and computing. One of the fastest growing spheres is
communications, making it a strong driver in BenQ's recent acquisition of Siemens' mobile devices business group. Together
they form a fresh new player in the mobile industry: BenQ Mobile.
e power of the new BenQ-Siemens brand lies in the ability to unite complementary strengths. BenQ-Siemens brings together
the best of two worlds – uniting Siemens, a telecommunications pioneer with BenQ, a technological lifestyle leader. e new
brand combines engineering quality and reliability with a true sense of enjoyment and appealing design, reflecting an interplay
between design and functionality that is leading to innovative and bringing new surprising and elegant products.
To realize our long-term sustainable business model, we formed a complementary partnership with Siemens Mobile Devices in
October of 2005. BenQ Mobile was formed and overnight we became a real 3C powerhouse. is is without a doubt the biggest
change BenQ has seen since its establishment.
- K.Y. Lee, Chairman
Main products
■GSM/GPRS/EDGE mobile phones
■W-CDMA mobile phones
■Smartphones
■CDMA IS-95/CDMA 2000 1X RTT mobile phones
■Wireless PDA's
Review of Operations
Business Results
Since BenQ acquired the Mobile Devices ("MD") business of Siemens AG on 1 October, 2005, this has created the world's sixth
handset maker, and the largest mobile phone technology company in Greater China. e company expects its revenue base
should come close to doubling with the acquisition.
e partnership, headquartered in Munich, created one of the world's leading global players in the mobile handset industry, with
strong global manufacturing, design expertise and a robust intellectual property portfolio. e strategic partnership combined
the uniquely complementary strengths of both companies.
With the Siemens trademark for mobile phones and co-branding rights to BenQ-Siemens , this provided immediate global upli
to BenQ's business development efforts through an association with the Siemens brand, which ranked number 39 in a recent
global brand survey.
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2005 Annual Report
■Merging the organizations in order to simplify and focus:
● Offering a compelling roadmap and introducing global categories to strengthen and “consumerize” portfolio
● Establishing one global product house to comprise important value creation functions (R&D, SCM and Procurement)
● Setting up new regional offices of sales and distribution to better address local markets and needs
■Introducing the combined brand BenQ-Siemens to communicate new identity and positioning
■Signing sponsoring agreement with Real Madrid soccer team to support new brand positioning
■Setting up a persistent cost management program
Product Features and Awards
Continuing a tradition of excellence, BenQ-Siemens launched 12 exciting new handsets in first quarter of 2006:
BenQ-Siemens EF81
■UMTS in a 15.9 mm slim magnesium clamshell
■2.0 megapixel camera for video telephony, still photography and video recording
■Two large displays (2.2 inch QVGA and 1.3 inch QQVGA)
■Premium materials
■Wide range of Headset Bluetooth solutions
BenQ-Siemens EF91
■High-speed data transfer and downloads via HSDPA
Swi and easy sharing of photos, videos and multimedia content via 3.5G service
■Excellent high-resolution camera
3.2 megapixel autofocus camera with integrated LED flash and 7x digital zoom. Video recording, playback, streaming and
progressive download.
■Brilliant display
A brilliant display with 262,144 colors, LTPS TFT, 240 x 320 pixels, 2.0 inches
■Intelligent power saving via light sensors
BenQ-Siemens EL71
Unexpected Finishing
■Real metal finish - brushed aluminum and magnesium
■Slim and compact slider - 16.5 mm thin
■Very bright QVGA display for optimal readability both indoors and outdoors, 262,144 colors
2005 Annual Report
13
BenQ-Siemens CF61
Multifaceted Snapshot Phone
■Exchangeable front covers to suit your style
■3D surround sound allows you to enjoy music with friends
■High-quality 1.3 megapixel camera with "9 consecutive shots" & "living picture" options
■MicroSDTM slot
BenQ-Siemens EF51
■A fully featured music solution: FM-Radio, music-player (MP3/WMA/AAC(+)), music MMI, miniSD? card slot, easy file
transfer mobile phone – PC, bundled stereo headset and USB data cable
■ Dual mode design concept: music player style with special music keypad in closed mode, mobile phone in open mode
■More than a music player: Music specials:
Speech-to-MusicTM, audio & FM radio recording,
3D surround sound and 6 band equalizers, Show-lyrics function.
1.3 mega pixel camera with 4x digital zoom.
BenQ-Siemens E61
■iF Design Award 2006
■Exquisite and fashion ID design
■Musical fun with dedicated MP3 control keys on the top
■Extendable memory card (Mini SD)
■VGA camera, 2x/4x linear digital zoom
■Loud speaker playing
BenQ-Siemens CL71
■iF Design Award 2006
■Super slim slide phone with semi-automatic slider mechanism
■Rich multi-media applications
■Large and high-quality TFT display
■Extendable memory
BenQ-Siemens S88
■Brilliant Active Matrix OLED with 170o viewing angle and 10,000:1 contrast ratio for display of multimedia content,
2.0", 176 x 220 pixels
■2.0 megapixel camera with 16x smooth digital zoom, autofocus and LED flash
■ull multimedia support: video recording/playback, music player, microSDTM card slot
■Direct printing of pictures with PictBridge
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2005 Annual Report
BenQ-Siemens S81
Slim Look – Full UMTS
■UMTS with high-speed data rate (384 Kbps) realized in a slim design
■Video telephony via VGA camera
■Video streaming and downloading with H.264/AAC+ format
■MP3 player – microSDTM card slot (min 30 MB built-in memory)
■Integrated 1.3 megapixel camera with LED flash
■Full PIM function and easy PC synchronization
BenQ-Siemens S68
Professional Convenience
■Premium slim design with an extraordinary finish
■Focus on core business functions
■Convenient usage with voice message and dictaphone key, Fast DialingTM key
■Optimal visibility of display content under all lighting conditions
■Design focused on best ergonomics and usability
BenQ-Siemens C81
Multimedia Companion
■Full multimedia support: video recording, playback and streaming
■Latest audio codecs: MP3-eAAC+ and enhanced music sorting
■Best-in-class loudspeaker for superior sound
■1.3 megapixel camera with 5x digital zoom
■Video ringtones and sound recorder
■128 MB RS-MultiMediaCard & Headset Stereo bundled for up to 10 h of music listening
BenQ-Siemens P51
e Smart Navigator
■Full business functionality: Windows MobileTM 5.0, SKYPE, ActiveSync, e-mail push, document browsing and editing incl.
PowerPoint
■Mobile navigator with integrated GPS receiver & onboard navigation solution (optional)
■Seamless connectivity: WLAN 802.11 b/g, Bluetooth , USB, SDIO slot
■Easy date input: QWERTY keyboard, large touchscreen display
■Full multimedia features: 1.3 megapixel camera, media player for video & music, ...
2005 Annual Report
15
Research & Development
Technologies in deployment
■GSM/GPRS/EDGE tri-band mobile phones
■W-CDMA mobile phones
■HSDPA mobile phones
■WIFI/WLAN enabled mobile phones
■Windows mobile-based smart phones
■CDMA 2000 1X RTT mobile phones
■Symbian-based smart phones
On-going efforts
■Innovative user-interface concepts and materials
■Navigation (GPS)
■Other user experience enhancing technologies (cameras, displays, storage, etc.)
Industry, Product Overview and Outlook
Overview and Outlook
According to various research estimates, the size of global mobile phone market is expected to grow from 772 million handsets
in 2005 to 1,129 million handsets in 2010. Regional markets in descending order of market size are as follows: Asia, North
America, Western Europe, Latin America, the Middle East and Africa, and Eastern Europe. Regional markets in descending
order of growth rate are Asia, the Middle East and Africa, Latin America, North America, Eastern Europe and Western Europe.
With the world's largest population and strong demand in new mobile phones, Asia is the number one market by size and
by growth rate. e Middle East and Africa have also grown fast due to strong demand in new mobile phones. Increasing
penetration in mobile phones has slowed down the expansion of new users in Latin America. However, growing demand in
mobile phone replacement has led to a certain degree of expansion for overall market size. In terms of North America, Western
Europe and Eastern Europe, because of steady replacement handset purchases, their market sizes remain the same.
Driven by high growth of new subscribers in emerging markets (e.g. India, Russia) and strong replacement sales in saturated
markets we expect that global sales of mobile phones to end users will grow with more than 10% yoy (unit base).
Source: Strategy Analytics, February 2006
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2005 Annual Report
Competition and Market Share
Global sell-in mobile phones 2005 (units) -all standards
In 2005 worldwide sell-in in all handset technology standards, amongst global top five mobile phone brands in descending order
are Nokia with 32% share, Motorola with 18% share, Samsung with 13% share, LG with 7% share and Sony Ericsson with 6%
share. BenQ Siemens was ranked No 6 with 5% share.
Global sell-in mobile phones 2005 (units) - GSM only
In 2005 worldwide sell-in in GSM standard, global top five mobile phone brands in descending order are Nokia with 38% share,
Motorola with 17% share, Samsung with 12% share and Sony Ericsson with 8% share. BenQ Siemens was ranked No 5 with 6 % share.
2005 Annual Report
17
Product Strategy in 2006
Key elements of BenQ's product strategy include:
■Enhancing the portfolio
BenQ-Siemens focus is on exploring the boundaries of innovation in design and technology, leading with 3G innovations
(HSDPA), pioneering display technologies (OLED) and capitalizing on design trends towards slimline phones and leading
with authentic materials - like magnesium, aluminum, stainless steel.
■New positioning
Driving towards a clear positioning of substance and emotion through the fusion of engineering competence with consumer
lifestyle and design, resonating strongly with the targeted Exploration segment.
Launching of new BenQ-Siemens brand with a 3-event strategy targeting diverse key audiences:
-Brand launch in Berlin & Beijing: Events well covered by top tier news, business and industry media
-3GSM Barcelona: Strong technology and trade press, coverage
-CeBIT Hanover: Consumer and general media, coverage
12 new BenQ-Siemens handsets in Q1 2006, including first HSDPA phone (3.5 G)
Mid- and high-end phones are listed on tier-one operators' roadmaps (e.g. EF81, S68, EF91, etc.)
Fusion of engineering competence with lifestyle and design
■Production, R&D and Design Synergies
Realizing synergies: One global product house going forward (R&D, SCM, Procurement) with no duplication in functions,
increasing speed while driving down cost
Offloading complexity: Consolidation of product and platform development at self-sufficient R&D sites
Structuring market-driven organization: Category managers in charge of each identified key customer segment ensuring
enhanced product experience
■Top line and cost improvement
Material savings to accelerate beginning in Q2/Q3 with ramped-up production of new models—redoubling BenQ resources
to achieve cost-cutting goals.
Savings in functional expenses well on track. Driving top line by improving the average selling price
■In less than two quarters, BenQ-Siemens have re-established themselves as a leader:
In innovation
–Radio Technology HSDPA, Services over the Air
–Display Technology OLED
–Material Technology
In design and user experience
–1/3 of devices with awards
–Slim line in all form factors
–Dedicated interfaces and “Simplexity”
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2005 Annual Report
In multimedia and applications
–10/12 with camera up to 3.2 Mpix
–11/12 with Multimedia
–Onboard navigation
–Cameras incl. autofocus
–DRM “Playsforsure” and Google
–3D sound
■Restoring customer confidence and market share
Restored customer confidence.
Reevaluate growth perspectives by product and Region (North America, India, Africa.
Increasingly leverage complementary (BenQ-Siemens) presence.
Mobile BG in Q1 2006
BenQ-Siemens EF81
BenQ-Siemens S68
BenQ-Siemens S88
BenQ-Siemens S81
BenQ-Siemens EF51
BenQ-Siemens EF91
BenQ-Siemens C81
BenQ-Siemens P51
BenQ-Siemens CF61
BenQ-Siemens CL71
BenQ-Siemens E61
BenQ-Siemens EL71
2005 Annual Report
19
Computing Products Business Group
To better meet the needs of changing business conditions and streamline operations, Display & Imaging Business Group,
Computing Products Strategic Business Unit and Storage Business Unit reorganized beginning August 2005 and changed its
name to Computing Products Business Group.
To bring together two of the industry's leading players and enhance the overall competitiveness of Taiwan's storage sector, LiteOn IT and BenQ formed a strategic alliance through manufacturing integration in optical storage products in 2006. As part of
the alliance, Lite-On IT will acquire BenQ's storage-related assets, including BenQ's ODM customer portfolio and the rights to
use BenQ's technology portfolio. Lite-On IT will also receive order commitments on BenQ-branded storage products. BenQ
will continue focusing on the marketing and sales of storage products and this strategic transaction will allow BenQ to better
address our ODD branded and 3C opportunities.
Main products
■Display Business Division: 15"/17"/19" multimedia LCD monitors, 15"/17"/19" LCD monitors for business use, 19"/20.1"/23"
LCD monitors for professional applications
■Storage Business Division: high speed read only optical drive (CD-ROM), high speed re-writable optical drive (CD-RW),
digital versatile disc drive (DVD-ROM), combo drive, digital versatile disc writer (DVD-RW)
■Computer Business Division: Joybook notebook persomal computers ( PC )
■SPC Business Division: color laser printers, flatbed scanners, high resolution film scanners, color inkjet orinters, color
multifunction printers
Business Results
BenQ in 2005 sold 9.7 million units of LCD displays, representing 35% of year-on-year growth. A top-three global LCD display
manufacturer of all sizes categories, BenQ commands number one position in 20"-and-above sizes, with a 25% market share.
Overall sales in 2005 remained little changed as a result of declines in average selling price.
BenQ recorded strong unit growth in its sale of Joybook notebook PC’s. e company sold 230,000 units worldwide, a growth of
130% compared with that of 2004. Growth was especially strong in China and Europe.
BenQ enters 2006 a strong player in the notebook space and positioned to enter top-ten position in some targeted markets
where the Joybook competes.
20
2005 Annual Report
FP72V 17" LCD Monitor
■e FP72V is a the paradigm of BenQ's thoughtful design. e FP72V utilizes an innovative light sensor, which can
automatically detect ambient light conditions and adjust the monitor’s brightness and contrast levels. e FP72V is designed
to optimize the comfort of your work environment. Utilizing its Timer function, parents can adjust and limit the usage of the
computer for their children.
■Best Innovation Award at 2005 CES
DW1655 16X Light Scribe / DVD Writer
■(LightScribe) Light Scribe Technology
■Supports BenQ's exclusive QSuite soware, diversified DVD Writer's Application
■16X High Speed DVDR Writer
■Supports DVD Dual Layer (8.5G)
■Supports BenQ's exclusive DCS, ADCS and AFCS (DCS, Dual Cooling System - ADCS, Anti-Dust Cooling System and AFCS,
Air-Flow Cooling System )
■Supports Solid-Burn, auto-adjusting writing technologies to enhance.
■Editor's Choice award from Europe's CDRInfo magazine
■Obtained Extreme Excellence Award from America's ExtremeMHz
3500 Multi-Function Printer
■BenQ's Multi-Function Printer CM3500 Multifunction printer won National Awards of Excellence 2005; the CM3500 can
photocopy pictures and documents in color.
■e CM3500 also won Best Choice of Computex Taipei 2005 Award in peripherals category.
Joybook S72
■Shares the same ID design with Joybook 7000, which received the G-Mark Award and the Red Dot Award.
■14" widescreen (WXGA 1280 x 768), with 200 nits brightness
■Futuristic Magnesium Alloy Casing
■Pioneering “Front air-intake cooling system
■Ergonomic, curved keyboard design
■Innovative no-latch design
■Integrating a laser-pointed remote control device
■Zero-Gap touchpad design
■Elevated screen hinge design
■Built-in ATIR MobilityTM RadeonTM X600 delivering outstanding graphic performance
■QPower-BenQ's exclusive "Intelligent power management system
2005 Annual Report
21
■LCD Monitor: On October 21, 2005, BenQ took the lead to launching FP93GX, a monitor with lightning-fast 2-ms gray-togray response time. e technology of AMA (Advanced Motion Accelerator) delivers the excellent response time performance
to the market.
■Optical Writer: 16X DVDRW, Slim DVDRW, CDRW Modules, Light-Scribe Technology, Intelligent Solid-Burn Technology.
■Joybook: Featuring a full line-up of notebook computers with best-in-class brightness attributes. Joybook R53 is the world’s
fastest in terms of response time 15.4” wide-screen display notebook featuring 16ms response time.
On-going efforts
■LCD Monitor: BenQ have had good success developing monitors for everyone use; the Company plans to continue expanding
into higher-end monitors for professional use.
■Optical Writer: 2nd generation of Blue-Ray Disc Writer, CDR for game application, slim slot-in type CDR, AV module
application.
■Joybook:
1.Launching certified "green" Joybooks in Q1 2006.
2. Integrating an increasing number of mobile multimedia applications.
3. Enhancing interface integration.
■Multi-Function Printer:
1. Developing second generation of print heads to improve printing speed and color processing.
2. Strengthening fax applications and other applications such as card reader, picture bridge... etc.
3. Developing cordless MFP capabilities, enhancing Bluetooth and Wi-Fi connectivity.
Display Business Division
DisplaySearch estimates that the global market size of LCD display to be 106.2 million units in 2005. Total global demand for
LCD display in 2006 is forecast to grow to 130 million units. We expect the growth rate to slow in 2006. Beyond 2006 annual
growth rate should continue to plateau with growth rates potentially going below 10%.
Supply of LCD panels should continue to outpace demand in 2006, and we see this phenomenon continuing over the next
several years. We believe companies having advantages accessing key components, economies of scale and advantages in product
execution should continue to outdistance competition.
Storage Business Division
TSR Data indicates the total market size grew 14% over 2004 to 282 million drives with DVDRW growing the fastest. Estimated
total demand for 2006 is 298 million drives, an increase of 6% over 2005.
On 10 April 2006, BenQ and Lite-On IT announced that they have formed a strategic alliance that will bring together two of
the industry's leading players and enhance the overall competitiveness of Taiwan's storage sector. e transaction is expected to
increase Lite-On IT's global market share , making it the world's No. 2 optical disk drive (ODD) maker.
22
2005 Annual Report
Computer Business Division
According to IDC, total demand for notebook PC was approximately 65 millions units in 2005 compared with 49 millions units
in 2004, which translates to a growth of 33%. With the price point of notebook continuing to come down, we expect demand
for notebook PC's to continue exponential growth in the next few years.
With introduction of Intel Napa Dual Core platform and Microso Vista, we believe we should see a pick up in demand for
replacement PC's. Total demand for notebook PC should reach 95 million units in 2008, according to industry analysts.
SPC Business Division
Shipment of multifunction printers has grown nicely over the past several years. Competition, however, was fierce in 2006
with the entry of a number of low-priced products. While we are seeing good momentum with BenQ-brand printers, we
have continued to co-operate with leading U.S. and Japanese brands on an ODM basis. With our own-brand printers, we will
continue to focus on developing opportunities in emerging markets such as Middle East and China.
According to DisplaySearch, BenQ-branded LCD-monitor ranked in 7th place in 2005; BenQ ranked 5 in China, 7th in EMEA
and Asia Pacific, 9th in Latin America and 15th in Japan and North America. Importantly, BenQ is No.1 globally in 20-in-orabove segment with a market share over 25% worldwide.
A top-three LCD-monitor manufacturer in the world, we believe we are well positioned to improve on market standing in 2006,
leveraging BenQ know-how --in particular our "SenseyeTM Technology" -- and the benefits of backward integration with panel
makers including AU Optronics.
Competing in this extremely competitive environment,.Korean and Taiwanese manufacturers have held market share greater
than 80%. e global top four are significantly more competitive in material and manufacturing cost.
e strategic alliance that Lite-On IT and BenQ form in optical storage products should, we believe, enable Lite-On IT to
further improve its competitiveness in the ODM market. With the alliance, Lite-On IT will become the world's second largest
ODD manufacturer.
2005 Annual Report
23
e World's top four makers of Half Height Optical Drives ( 2005 )
Manufacturer
World Ranking
Market Share
HLDS
1
30.3%
TSST
2
21.6%
Lite-On
3
19.9%
BenQ/PBDS
4
9.5%
e World's top four makers of Half Height DVD RW drivers ( 2005 )
Manufacturer
World Ranking
Market Share
HLDS
1
30.4%
NEC
2
15.8%
TSST
3
11.7%
BenQ/PBDS
4
11.6%
Source: TSR Jan/06
Computer Business Division:
According to Gartner Dataquest, BenQ-branded joybook ranked 19th wordwide, 13th in Asia Pacific, 24th in Eastern Europe
and 19th in Western Europe in 2005. Growth was especially strong in China and Europe.
BenQ's scanner products commanded a 22.3% global market share in 2005.
■Continuing to focus on larger-sized, high-performance models where we believe BenQ has distinct advantage.
■Aggressively focusing on promoting the high-performance benefits – including image quality and color brightness – meeting
the needs of discerning professional users and video game enthusiasts.
■Continuing cooperating with AU Optronics to develop high quality LCD monitors. Developing partnerships with tier-one
panel vendors to ensure smooth procurement.
■Growing market share to maximize the benefits of scale economy.
■Increasing BenQ's market share in Europe, as well as strengthening distribution in the emerging markets transitioning from
CRT to LCD monitors.
24
2005 Annual Report
■Shortening time to market and product launch. Co-operating with Philips on developing the next generation of Blue-Ray
optical drives.
■Increasing shipment of game playing devices driving revenue and profit generation.
■Launching the 2nd generation of DVD-RAM drives and Light Scribe Writers.
Computer Business Division
■Enhance interface integration with BenQ's 3C products such as mobile phones, storage, etc…, including incorporating
built-in DTV capability and integrating video / audio applications.
■Re-engineer for greater organizational effectiveness and channel efficiency.
■Accelerating revenue growth for enhanced scale.
■Strengthening vendor relations and have vertically integrate to increase profitability.
Computing Products BG in Q1 2006
Joybook R53
Joybook S61
Joybook S73
DVD-RW
DW1670
DVD-RW
DW1655
LCD Monitor
FP93V
LCD Monitor
FP91R
LCD Monitor
FP241W
LCD Monitor
FP92E
LCD Monitor
FP785+
Color multifunction printer
CM3500
Color laser printer
CP25
2005 Annual Report
25
Digital Media Business Group
Digital Media's scope encompasses a number of high-growth products having strong synergies with each other. We aim to
capitalize on these synergies in executing leading-edge, high-margin products, beginning with BenQ's market-leading projector,
LCD TV and digital camera-center pieces of the digital home, offices and digital mobility.
BenQ provides the total Enjoyment Network in office and at home to customers by integrating strong product technologies.
Amongst many of BenQ's innovations, we have continued to leverage BenQ's image-enhancing senseye technology that delivers
stunning, theater-like performance in the office and digital home.
Main products
Digital projectors, LCD TVs, digital cameras, car displays.
Business Results
Projector shipment reached a record high in Q4 last year. BenQ-branded projectors are fast gaining recognition worldwide due
to BenQ's innovations, sleek product design and successful channel strategy. BenQ projectors ranked No.2 in the world in terms
of units shipped in Q4 of 2005. Equipped with anti-flare Super Multi-Coating technology from Pentax, our digital camera is able
to greatly enhance vividness of images. Our partnership with Pentax has enabled BenQ to significantly upgrade our product
offerings. Shipment in Q4 also set a record high. LCD TV also scored many wins. Built with exclusive display technology that is
more responsive to the full potential of the human eye, BenQ's LCD TV optimizes contrast and sharpness, generating unparalled
clarity and depth.
26
2005 Annual Report
Home Cinema projector PE8720
■Cinema class DC3 chip from TI
■Native 16:9
■High Resolution: 1280x720
■Ultra-High Contrast Ratio of 10000:1
■Senseye color engine powering superior color reproduction
■eater-like viewing experience
■Equipped with professional HDMI/HDCP connector
LCD TV DV3251/DV3253
■SenseyeTM Technology
■Professional Home eater video and audio chip
■HDTV Compatible
■16:9 ratio guarantees zero distortion
■Fast response time
LCD TV DV3750
■SenseyeTM Technology
■1920x1080 full HD resolution
■High contrast ratio
■High Brightness
■3D Edge Filtering capsulizing video clarity
■DCDi de-interlacing
■SRS TruSurround XT
■HDTV Compatible
Digital Still Camera DC E520
■High quality Pentax smc lens with slim and stylish DSC body
■Superb high resolution: 2.5" LTPS LCD display
■DVD like quality, high resolution and fluid movie recording capability
■Stylish silver with slim body design, equipped with powerful battery with 300pcs picture shots
■E520, X610 recipients of the iF Design Award 2005
2005 Annual Report
27
■Projector: the PE8720 offers the highest contrast ratio in the world (10000:1). e MP 610 is the quietest data projector
currently available (25dp). e CP120 is the smallest wireless projector in the world.
■LDC TV: BenQ's Home eater LCD Display series will be launched encompassing a full range of sizes: 20", 26", 32", 37", 46".
Additionally, the 37" and 46" models will be fully HDTV compatible with an ultra high 1920X1080i resolution.
On-going efforts
■Projector: High Lumens, wireless projector and DLP rear projection TV over 70" in size.
■LCD TV: Future BenQ LCD TV models will integrate an ever greater array of digital-home applications, fully capitalizing on
the benefits of ATSC and DVB-T technologies.
■DSC: Developing slim, high-performance DSC/display devices.
Projector
Compared with a spectacular 2004, 2005 was a down year, with volume up 15% year on year and ASP down 30%. Like most
projector makers, BenQ faced issues relating to inventory correction in the first half. We were able to regain strength in the
second half capturing a greater share of the mid-to lower-priced market segments. BenQ's recovery was complete by year-end
when BenQ projectors ascended to the No.2 projector brand in terms of shipment in Q4 of 2005.
LCD TV
As global LCD TV sales volume sky rocketed in 2005, several market research associations and vendors are extremely optimistic
in the growth of 2006. According to DisplaySearch, the global LCD TV shipment reached 20 million pieces in 2005, and total
shipment of LCD TV panels should reach 27 million pieces. e growth of LCD TV in 2006 is estimated to be 80%, as a result,
global shipments forecast at 37-38 million pieces, and shipment of LCD panels forecast to reach 42 million units.
DSC
2005 was a turning point in DCS industry. Japanese DSC makers began to co-operate with non-Japanese vendors in response to
growing competition. To give an example, Pentax began licensing its world-class lens technology to non-Japanese competitors
including BenQ. Slimmer designs and innovative features have added elements of differentiation in an otherwise crowded space.
e DSC, it seems, is no longer all about pixel count. We expect migration in favor of slimmer models and strong multimedia
functionality to continue. We believe BenQ is nicely positioned in a space that will increasingly reward IT technology players.
BenQ projector went from No. 7 in the world in 2004 to No. 6 in the first half of 2005. In Q4 of 2005, BenQ projectors took over
2nd place in global sales.
28
2005 Annual Report
Projector
■Expanded projector line-up including more media and wireless applications.
LCD TV
■All series to be equipped with BenQ's state-of-the-art "senseye" technology. Continuing to elevate core technology in various areas.
■While providing viewing pleasure with stunning picture quality, BenQ's LCD TV will come equipped with enhanced
connectivity, interfacing DVD recorder, home theater, gaming console, just to name a few. We expect LCD TV will be the
center piece of the new digital home.
DSC
■Driving greater penetration of BenQ's DSC to CE or 3C channels.
■Targeting professional DSC users.
Digital Media BG in Q1 2006
Projector
PE7700
Projector
W100
LCD TV
DV3253
Projector
W10000
LCD TV
PL4271
Digital Camera
DC C530/C630
Projector
SP820
LCD TV
VL4233
Digital Camera
DC E600
Projector
MP770
Projector
CP120
LCD TV
VA421
Digital Camera
DC P500
Azteca 516
Digital Camera
DC X600
2005 Annual Report
29
Joybook R53
30
2005 Annual Report
Board of Directors and Supervisors
Chairman - K. Y. Lee
Director - Sheaffer Lee
Director - Stan Shih
Director - HB Chen
Director - Jerry Wang
Director - Ding-Yuan Yang
Director - Philip Peng(*)
Supervisor - Ronald Chwang
Supervisor - S.C. Hong
Title/Name
Education & Experience
Current Positions
Chairman:
K.Y. Lee
MBA, Switzerland IMD
B.S., Electrical Engineering, National Taiwan University
Vice President of Acer PC Product Marketing
Chairman: AU Optronics Corp., Darly Venture Inc.
Director: Darfon Electrics Corp., Daxon Technology Inc.
Director:
Stan Shih
M.S., Electronical Engineering, National Chiao Tung University
Chairman of Acer Group
Chairman: iD SoCapital Inc.
Director: Acer Inc., Wistron Corp., Taiwan Semiconductor Manufacturing
Company
Director:
Sheaffer Lee
B.S., Electrical Engineering, National Cheng Kung University
Assistant Vice President of Acer America
Chairman: Darfon Electronic Corp.
Director: AU Optronics Corp., BenQ Asia Pacific, Darly Venture Inc.
Director:
H.B. Chen
B.S., Communication Engineering, National Chiao Tung University
General Manager of BenQ Malaysia
Chairman: Wellypower Optronics Co. Ltd.
President: AU Optronics Corp.
Director:
Jerry Wang
EMBA, underbird International Management Institute
Vice President, Corporate Brand Management, Acer
Chairman: BenQ Asia Pacific Inc.
Director:
Philip Peng(*)
M.S., Business of Administration, National ChengChi University
Senior Vice President & CFO of Acer Inc.
Supervisor: Wistron Corp.,
President: iD SoCapital Inc.
Director:
Ding-Yuan Yang
Ph.D., Princeton University
M.S., Stanford University
President of Winbond Electronics Corp.
Vice Chairman of Winbond Electronics Corp.
Chairman: UniSVR Global Information Technology Corp.,
Radiantech Inc., Integrated System Solution Corp.,
FameG SOTA Design Technology Inc.
Director: CheerTek Incorporation, Opnet Technologies Co., Ltd.
Supervisor: Aimtron Technology Corp.
Supervisor:
Ronald Chwang
Ph.D. Electrical Engineering, University of Southern California,Los Angeles
Acer Technologies Venture, President
Acer America, America CEO
Acer Peripheral Business Unit, President
Chairman: iD Ventures America
Director: ATI Technologies, Inc., Silicon Storage Technologies, Inc.,
iRobot Corp.
Supervisor:
S.C. Hong
B.S., Economics, National Taiwan University
Vice President of Far Eastern Textile Ltd.
President of Hotung International Company Ltd.
President of Hotung Venture Capital Corp.
Chairman: Giga Venture Partners & Co.
President: Hotung Venture Capital Corp.
Vice President: Far Eastern Textile Ltd.
(*): Acer Incorporated resigned from BenQ's board of directors on 14.04.2006 in anticipation of selling down its holdings of BenQ shares.
2005 Annual Report
31
Towards Better Corporate Governance
Creating Value for Shareholders and Giving Back to the Community is an Integral Part of BenQ Value
BenQ's board of directors (BOD) aims to continue acting in the best interest of our shareholders, in accordance with commonly
accepted corporate governance principles. It's with the highest standard that our board members work closely with a dedicated
team of supervisors and certificate public accountants in carrying out its supervisor duty.
e board members shall benchmark BenQ against best-in-class corporate governance practices in safeguarding shareholders'
interests and making recommendations that will enhance return-on-investment to our shareholders.
- K.Y. Lee, Chairman
Maximizing Shareholder Value While Supervising the Board of Directors as an External Supervisor
"BenQ Supervisor needs to review the integrity and accuracy of the company financial reporting by working closely with the
management team, internal and external auditors on a timely and efficient manner. In addition to adherence to accounting
principles and assessment of risk control, by supporting the board of director, BenQ's Supervisor can help ensure corporate
governance and transparency which are faithfully followed to protect the shareholder value. Ultimately, the shareholder value
can be enhanced through the team work of BenQ Supervisor and the board to assist the management in its persistent effort to
improve the company overall performance and competitiveness."
- Ronald Chwang, Supervisor
LCD TV VL3231
32
2005 Annual Report
Material Resolutions Approved by Shareholders at Annual General Meeting and Board of Directors
Date
Meeting
Approval Events
2005 1st BOD Meeting
1.Accepted BenQ 2004 business report and financial statements. Net sales of parent company for 2004 was
NT$147.7 billion and of consolidated entity was NT$174.7 billion, and net income aer tax was NT$7,619
million, with earnings per share of NT$3.30.
2.Approved to revise the Articles of Incorporation.
3.Approved to elect Directors and Supervisors.
4.Approved to invest BenQ (shanghai) Ltd. in Mainland China by BenQ (L) Corp within the amount of US$ 10
million.
5.Approved to convene 2005 Annual General Meeting.
16.03.2005
2005 2nd BOD Meeting
1.Approved the proposal for distribution of 2004 profits and capitalization of 2004 dividends and employee
profit sharing. Stock dividend of NT$0.5 per share and cash dividend of NT$1.5 per share will be distributed
to shareholders.
2.Approved the record date for entitlement certificates to be transferred to common shares.
28.04.2005
2005 3rd BOD Meeting
1.Accepted BenQ financial statements for the three months ending on March 31, 2005.
2.Approved to issue of 2005 1st Unsecured Corporation Bond within the amount of NT$4 billion.
3.Approved to invest BenQ (IT) Co. Ltd. in Mainland China by BenQ (L) Corp within the amount of US$ 30
million.
4.Approved the change of Chief Internal Auditor.
18.05.2005
2005 Annual General Meeting
1.Accepted BenQ 2004 business report and financial statements.
2.Approved the proposal of BOD for distribution of 2004 profits and capitalization of 2004 dividends and
employee profit sharing.
3.Approved the proposal of BOD to revise the Articles of Incorporation.
4.Elected Directors and Supervisors.
18.05.2005
2005 4th BOD Meeting
1.Elected K.Y. Lee as Chairman of BenQ.
06.06.2005
1.Approved to Acquire Siemens AG's Mobile Devices Business.
2.Approved to propose of the issuance of new common shares to sponsor overseas DR offering within 150
million shares.
3.Approved to convene 2005 extraordinary General Meeting.
28.06.2005
1.Approved the shareholder, Acer Inc., to offer its BenQ common shares for issuing Global Depositary Shares.
28.07.2005
2005 7 BOD Meeting
1.Approved to set up a new holding company in the Netherlands investing up to US$200 million.
28.07.2005
2005 Extraordinary General Meeting
1.Approved the Proposed Acquisition of Siemens AG's Mobile Devices Business.
2.Approved the Proposed Issuance of New Common Shares or Global Depositary Receipts (GDRs).
18.08.2005
1.Accepted BenQ's financial statements for the six months ending on June 30, 2005.
2.Approved to propose of the issuance of new common shares to sponsor overseas DR offering within 150
million shares.
3.Approved to invest BenQ (Shanghai) Co. Ltd. in Mainland China by BenQ (L) Corp within the amount of
US$ 10 million.
12.10.2005
1.Approved to buy back 60 million shares within two months and the amount of NT$2.4 billion.
27.10.2005
2005 12 BOD Meeting
1.Accepted BenQ financial statements for the nine months ending on September 30, 2005.
2.Approved to invest BenQ (Shanghai Pudong) Co. Ltd. in Mainland China by BenQ (L) Corp within the
amount of US$ 30 million.
3.Approved to invest BenQ (NanJing) Hospital Management Gonsultants Co., Ltd. in Mainland China by BenQ
BM Holding Corp within the amount of US$ 1 million.
4.Approved to invest BenQ Guru Systems (Suzhou), Co., Ltd. in Mainland China by BenQ Guru Holding
Limited within the amount of US$ 3 million.
14.03.2006
2006 2nd BOD Meeting
1.Accepted BenQ 2005 business report and financial statements. Net sales of parent company for 2005 was
NT$125.4 billion and of consolidated entity was NT$176.8 billion, and loss aer tax was NT$5.2 billion, with
losses per share of NT$2.12.
2.Approved to revise the Articles of Incorporation.
3.Approved to convene 2006 Annual General Meeting.
4.Approved to issue of 2006 1st Unsecured Corporation Bond within the amount of NT$4 billion.
5.Approved to invest BenQ Logistic (Shanghai) Co.,Ltd in Mainland China by BenQ (L) Corp within the
amount of US$ 0.8 million.
6.Approved to invest Gallamt Preoisions (Suzhou) Co.,Ltd. in Mainland China by BenQ (L) Corp within the
amount of US$ 8.9 million.
7.Approved to invest BenQ Mobile Holding B.V. within the amount of US$ 300 million.
8.Approved to invest BenQ (L) Corp within the amount of US$ 20 million.
9.Approved to invest China-based BenQ subsidiaries by BenQ (L) Corp within the amount of US$ 10.5 million.
10.04.2006
2006 3rd BOD Meeting
1.Approved Lite-On IT and BenQ to Form a Strategic Alliance through Manufacturing Integration in Optical
Storage Products.
2.Approved to issue stock option of 100 million shares.
th
th
2005 Annual Report
04.02.2005
33
Management Team
Management Resources
K.Y. Lee
Chairman
Sheaffer Lee
President
Eric ky Yu
Chief Financial Officer
Jerry Wang
Chief Marketing Officer
Irwin S Chen
Mobile
Clemens Joos
Mobile
Hemit Huang
Computing Products
Peter Chen
Digital Media
BenQ is led by a seasoned management team with a proven track record of
product innovation and delivering returns to shareholders:
■ Long tenure with BenQ - Solid and Stable
■ One of the Strongest branding management teams in Asia
■ Lifestyle Design Center enhancing value of BenQ products
34
2005 Annual Report
Corporate Executive Officers
Title
Name
Personnel Education & Experience
Other Current Positions
K.Y. Lee
MBA, Switzerland IMD
B.S., Electrical Engineering, National Taiwan University
Vice President of Acer PC Product Marketing
Chairman: AU Optronics Corp., Darly Venture Inc.
Director: Darfon Electrics Corp.,
Daxon Technology Inc.
President & COO
Sheaffer Lee
Assistant Vice President of Acer America
Chairman: Darfon Electronic Corp.
Director: AU Optronics Corp.,
BenQ Asia Pacific Inc.,
Darly Venture Inc.
Executive Vice President
CMO
Jerry Wang
VP, Corporate Brand Management, Acer
Chairman: BenQ Asia Pacific Inc.
Senior Vice President
Business Strategy Office
Rick Lei
EMBA, National ChengChi University
B.S., Engineering Science, National Cheng Kung University
President, Acer Digital Service Corp.
Chairman: Airoha Technology Inc.
Director: Raydium Semiconductor Co.,
Computing Products BG
Hermit Huang
EMBA, National Taiwan University
Electronics Engineering, National Taipei Institute of Technology
-
BenQ Mobile Group
Irwin S Chen
Ph.D., EE, University of Maryland
Manager, Qualcomm Inc.
Director: Airoha Technology Inc.
Finance Division
Eric Ky Yu
MBA, Strathclyde Graduate business School, U.K.
Controller, BenQ Malaysia
Chairman: Daxon Technology Inc.
Director: Gallant Precision Machining Co., Ltd.
Supervisor: AU Optronics Corp.,
Darfon Electronics Corp.,
Airoha Technology Inc.,
BenQ Asia Pacific Inc.,
Darly Venture Inc.
Vice President
Alpha Tsai
EMBA, National Cheng Chi University
M.S., Electrical Engineering, New York University-Stony Brook
B.S., Electrical Engineering, Nation Taiwan University.
-
Vice President
Global Manufacturing
Operation Office
CM Wu
EMBA, Pacific Western University
B.S., Electronics Engineering, Chung Yuan Christian University
-
Vice President
Advanced Technology
Center
Kelvin Lee
Ph.D., Electrical Engineering, National Taiwan University
M.S., Electrical Engineering, National Cheng Kung University
-
Vice President
Digital Media BG
Peter Chen
MBA, National ChengChi University
Director: Darfon Electronics Corp.
Associate Vice President
Hank Horng
M.S., Mechanical Engineering, National Cheng Kung University
Executive, PC Division, IBM Taiwan
Executive, Strategy & Development, IBM China
-
Associate Vice President
Vince Liaw
MBA, National ChengChi University
B.S., ME, National Taiwan University
-
Director
Daniel Hsueh
MBA, National Sun Yat-Sen University
B.S., ME, National Taiwan University
-
Director
Digital Media BG
April Huang
National Taiwan University
Daxon Technology Inc.
-
Director
Richard Hsu
M.S., ME, University of Oregon
Acer Incorporated
-
Director
Digital Media BG
JY Hu
MBA, National Taiwan University
B.S., Applied Mathematics, National Cheng Chi University
-
Director
Digital Media BG
Robert Chang
Dean of College of Commerce,National Cheng Chi University
B.S., Mathematics, Soochow University
-
Director
Finance Division
Jasmin Hung
MBA, Finance, California State University
B.S., International Trade, Chung Yuan Christian University
Controller, Daxon Technology Inc.
-
2005 Annual Report
Chairman
35
Group Organization
Company Organization Chart
BenQ
Corporation
Shareholders
Supervisiors
Audit Team
Borad of Directors
Chairman
President
Corporate
Operation
Sales
Operation
Business
Operation
Administrative
Operation
Manufacturing
Operation
Advanced
Technology
Center
Finance
Division
Taiwan
Manufacturing
Development
Office
HR Division
America
China
Global Quality
Assurance
Office
ITS Division
Europe
Malaysia
Asia Pacific
Mexicana
Legal Office
Regional
Operation
Branding
Business
Strategy Office
China
Lifestyle
Design Center
Corporate
Venture Office
Mobile BG
Digital
Media BG
Computing
Products BG
e Czeh
Republic
36
2005 Annual Report
Affiliated Companies
2005 Annual Report
37
Company Financials
LCD TV VL3231
38
2005 Annual Report
Capital and Shares
Shares Type and Shares Outstanding
Shares Type
Notes
Un-issued shares
Total shares
2,624,880,011
375,119,989
3,000,000,000
Company Financials
Common Shares
Authorized Shares
Outstanding shares*
Listing Shares
*include entitlement certificates
Ownership and Distribution of Shares
Domestic Individuals
As of March 23, 2004
As of March 20, 2005
As of April 16, 2006
Number of
shares held
Number of
shareholders
Number of
shares held
Number of
shareholders
Number of
shares held
Number of
shareholders
1,106,555,909
148,350
1,243,416,470
159,595
1,405,324,738
180,396
Other Domestic Corporations
470,860,064
358
468,232,477
319
476,911,227
292
Foreign Institutions and Individuals
337,349,511
296
418,149,857
316
585,753,284
326
Government Agencies
79,385,388
6
113,568,260
9
94,742,480
9
Domestic Financial Institutions
73,327,335
29
73,189,767
28
62,148,282
42
2,067,478,207
149,039
2,316,556,831
160,267
2,624,880,011
181,065
Total
2005 Annual Report
39
Net Worth, Earning, Dividends and Market Price Per Share
Market Price Per Share
Net Worth Per Share (Note 1)
Earnings Per Share (EPS)
Dividends Per Share
Unit: NT$; Per Share
Year 2004
Year 2005
Highest Market Price
53.50
37.20
Lowest Market Price
30.30
27.20
Average Market Price
39.47
32.01
Before Distribution
21.25
17.38
Aer Distribution
19.64
-
Weighted Average Shares
2,310,825
2,459,298
EPS
3.30
(2.12)
EPS-adjusted (Note 2)
3.10
-
Cash dividends
2.0
1.5
Stock dividends- Earnings
1.0
0.5
-
-
-
-
Stock dividends- Capital Surplus
Accumulated Undistributed Dividend
Return On Investment
Price/Earning Ratio (Note 3)
11.96
-
Price/Dividend Ratio (Note 4)
19.74
21.34
Cash Dividend Yield Rate (Note 5)
5.07%
4.69%
Note 1: Subject to change aer shareholders’ meeting resolution
Note 2: Retroactive adjustment for capitalization of bonus
Note 3: Price/Earning ratio = Average market price/Earnings per share
Note 4: Price/Dividend ratio = Average market price/Cash dividends per share
Note 5: Cash dividend yield rate = Cash dividends per share/ Average market price
Dividend Policy
According to BenQ's Article of Incorporation, the company's dividend policy is as follows:
If the company has surplus profits at the end of each business year, the profits are to be first used to pay taxes and make good
of past losses and then set up 10% as legal reserve. e balance, if any, shall be used to pay dividends before being allocated as
follows:
a. Employee bonus: 5% to 10%;
b. Remuneration of directors and supervisors: 1% or less; and
c. e balance shall be distributed partially or totally as dividends.
Method of distribution and ratio of bonus may be adjusted by the shareholders' meeting.
Share Repurchase History
Instance
2nd Round
3th Round
4th Round
Purpose
To create shareholders value
To create shareholders value
To transfer to employees
16.12.2003-15.02.2004
30.03.2004-29.05.2004
13.10.2005-12.12.2005
Period
Price Range
Volume
Amount
NT$40-45 per share
NT$27-40 per share
4,457,000 common shares
NT$1,256,063,300
NT$196,605,100
NT$1,759,156,948
0
Accumulated Holding
N/A
N/A.
Accumulated Holding as a Percentage of Total Issued Shares(%)
0%
0%
2.29%
Shares Cancelled or Transferred Volume
40
NT$40-45 per share
2005 Annual Report
BenQ Corporation
Non-consolidated Balance Sheets
December 31, 2003, 2004 and 2005 (expressed in thousands of New Taiwan dollars and US dollars)
Property, plant and equipment :
Land
Buildings
Machinery and equipment
Furniture and fixtures
Miscellaneous equipment
Prepayments for plant and equipment
Less: accumulated depreciation
Net property, plant and equipment
Other assets:
Rental assets
Refundable deposits
Deferred expenses
Deferred income tax assets – noncurrent
Total other assets
Total assets
Liabilities and Stockholders’ Equity
Current liabilities:
Short-term borrowings
Notes and accounts payable
Accounts payable to related parties
Other payables to related parties
Bonds payable
Accrued expenses and other current liabilities
Income taxes payable
Deferred inter-company profit
Total current liabilities
Bonds payable
Other liabilities
Total liabilities
Stockholders’ equity :
Common stock
Convertible bonds applied for conversion
Capital Surplus:
Additional paid-in-capital in excess of the common stock’s par value
Convertible bonds converted in excess of the common stock's par value
Capital surplus from treasury stock transactions
Capital surplus from long-term equity investments
Legal reserve
Retained earnings
Special reserve
Translation adjustment
Treasury stock
Total stockholders’ equity
Commitments and contingencies
Total liabilities and stockholders’ equity
2003
NT$
2004
NT$
2005
NT$
US$
1,139,573
3,480,521
8,300,466
19,724,408
12,685
69,620
5,464,505
299,150
927,183
39,418,111
599,457
5,431,034
5,463,363
20,060,826
193,600
91,054
3,859,895
306,704
551,148
36,557,081
161,789
104,572
6,498,786
25,211,100
911,636
7,548,906
5,581,355
1,642,433
463,010
48,123,587
4,932
3,188
198,134
768,631
27,794
230,150
170,163
50,074
14,116
1,467,182
27,416,958
2,429,781
29,846,739
30,393,198
1,594,978
31,988,176
31,670,537
1,435,406
33,105,943
965,565
43,763
1,009,328
2,379,356
3,958,980
2,285,664
131,842
74,264
129,274
8,959,380
(2,087,349)
6,872,031
2,135,472
3,552,100
2,452,524
139,819
69,770
212,610
8,562,295
(2,492,858)
6,069,437
2,135,410
3,552,743
2,436,393
146,528
69,441
283,095
8,623,610
(2,830,831)
5,792,779
65,104
108,315
74,280
4,468
2,117
8,631
262,915
(86,306)
176,609
457,208
7,368
129,718
78,050
672,344
76,809,225
1,013,907
53,083
130,810
788,418
1,986,218
76,600,912
997,171
8,584
1,042,532
973,344
3,021,631
90,043,940
30,402
262
31,784
29,675
92,123
2,745,242
2003
NT$
2004
NT$
NT$
2005
US$
6,963,455
16,085,844
41,068
201,700
4,624,427
61,364
167,560
28,145,418
2,697,351
504,492
31,347,261
5,875,657
13,237,809
101,519
1,400
3,576,749
251,707
5,377
23,050,218
4,287,855
184,976
27,523,049
2,635,137
4,706,044
16,395,479
4,787,710
1,138,662
3,418,044
332,702
33,413,778
7,050,000
5,148,897
45,612,675
80,340
143,477
499,862
145,967
34,715
104,209
10,143
1,018,713
214,939
156,978
1,390,630
20,838,612
13,436
20,852,048
23,150,141
23,150,141
26,186,722
13,063
26,199,785
798,376
398
798,774
5,238,950
6,923,885
7,239
1,408,202
13,578,276
2,504,415
8,931,983
476,861
(881,619)
45,461,964
5,152,848
7,106,864
6,812
2,421,756
14,688,280
3,254,424
8,144,108
(81,754)
(77,336)
49,077,863
8,295,561
7,168,462
12,432
3,097,893
18,574,348
4,016,353
(3,038,409)
81,754
434,760
(1,837,326)
44,431,265
252,913
218,551
379
94,448
566,291
122,450
(92,634)
2,492
13,255
(56,016)
1,354,612
76,809,225
76,600,912
90,043,940
2,745,242
2005 Annual Report
Company Financials
Assets
Current assets:
Cash and cash equivalents
Short-term investments
Notes and accounts receivable
Accounts receivables from related parties
Other receivable from related parties
Other financial assets - current
Inventories
Prepaid expenses and other current asset
Deferred income tax assets – current
Total current assets
Long-term equity investments :
Equity method
Cost or lower-of-cost-or-market method
41
BenQ Corporation
Non-consolidated Statements of Income
Years ended December 31, 2003, 2004 and 2005
(expressed in thousands of New Taiwan dollars and US dollars, except earnings per share)
2003
2004
NT$
NT$
2005
NT$
US$
Net Sales
108,698,931
147,770,156
124,406,697
3,792,887
Cost of goods sold
(98,448,398)
(136,071,972)
(117,800,512)
(3,591,479)
10,250,533
11,698,184
6,606,185
201,408
9,648
162,182
(327,325)
(9,979)
10,260,181
11,860,366
6,278,860
191,429
Selling
(3,086,025)
(3,433,615)
(2,970,757)
(90,572)
Administrative
(1,092,148)
(957,431)
(950,728)
(28,986)
Research and development
(2,838,847)
(3,726,225)
(3,273,284)
(99,795)
(7,017,020)
(8,117,271)
(7,194,769)
(219,353)
3,243,161
3,743,095
(915,909)
(27,924)
1,016
Change in unrealized inter-company profits
Gross profit
Operating expenses :
Operating income (loss)
Non-operating income:
Interest income
9,132
6,972
33,317
3,722,494
3,563,548
-
-
208,539
169,032
98,243
2,995
1,918
3,250
7,551
230
Gain on disposal of investments, net
252,911
382,275
1,787,359
54,493
Foreign currency exchange gain, net
210,004
278,086
-
-
Others
178,308
200,053
272,198
8,299
4,583,306
4,603,216
2,198,668
67,033
Interest expense
(178,167)
(245,046)
(488,901)
(14,905)
Investment loss
-
-
(5,515,181)
(168,146)
Impairment loss on long-term equity investment
-
(350,000)
(149,307)
(4,552)
(26,054)
(19,269)
(2,943)
(90)
-
-
(381,650)
(11,636)
-
-
(18,598)
(567)
(2,729)
(3,470)
(32,306)
(985)
Investment income recorded under the equity method, net
Dividend income
Gain on disposal of property, plant and equipment
Non-operating expenses:
Loss on disposal of property, plant and equipment
Foreign exchange loss, net
Impairment loss
Others
(206,950)
(617,785)
(6,588,886)
(200,881)
Net income (loss) before income tax
7,619,517
7,728,526
(5,306,127)
(161,772)
Income tax benefit (expense)
(119,422)
(109,238)
80,556
2,456
Net income (loss)
7,500,095
7,619,288
(5,225,571)
(159,316)
Basic earnings (loss) per share
3.24
3.10
(2.12)
(0.065)
Diluted earnings (loss) per share
3.18
3.08
-
-
Earnings (loss) per share :
42
2005 Annual Report
BenQ Corporation
Non-consolidated Statements of Changes in Stockholders' Equity
Years ended December 31, 2003,2004 and 2005 (expressed in thousands of New Taiwan dollars)
NT$
Balance at January 1, 2003
Net income for 2003
16,810,510
-
Legal
Reserve
Special
reserve
NT$
NT$
NT$
NT$
NT$
- 13,296,073
1,764,452
-
8,721,127
766,083
-
-
7,500,095
-
-
7,500,095
NT$
-
Capital
Surplus
-
Appropriation of earnings and capital surplus:
Legal reserve
Retained Translation
Earnings Adjustment
(Loss)
Treasury
Stock
Total
NT$
NT$
(79,923) 41,278,322
-
-
-
739,963
(739,963)
-
-
-
3,861,102
-
-
-
- (3,861,102)
-
-
-
Cash dividends
-
-
-
-
- (2,521,577)
-
- (2,521,577)
Employee bonus paid in cash
-
-
-
-
-
(100,000)
-
-
(100,000)
Directors’ and supervisors’ remuneration
-
-
-
-
-
(66,597)
-
-
(66,597)
167,000
13,436
462,616
-
-
-
-
-
643,052
Treasury stock acquired by the Company
-
-
-
-
-
-
-
(802,425)
(802,425)
Change in treasury stock held by subsidiaries
-
-
-
-
-
-
-
729
Cash dividends paid to subsidiaries which hold the
Company’s share
-
-
4,257
-
-
-
Adjustments in net equity of investee companies
-
-
(184,670)
-
-
-
-
-
(184,670)
Change in foreign currency translation adjustment
-
-
-
-
-
-
(289,222)
-
(289,222)
13,436 13,578,276
2,504,415
-
8,931,983
476,861
-
-
7,619,288
-
-
7,619,288
Retained earnings transferred to common stock
Convertible bonds converted to common stock and
capital surplus
Balance at December 31, 2003
Net income for 2004
20,838,612
-
-
-
Legal reserve
-
729
4,257
(881,619) 45,461,964
-
-
-
750,009
(750,009)
-
-
-
2,517,592
-
-
-
- (2,517,592)
-
-
-
Cash dividends
-
-
-
-
- (4,123,924)
-
- (4,123,924)
-
-
-
-
-
(50,626)
-
-
(50,626)
-
-
-
-
-
(67,501)
-
-
(67,501)
138,507
(13,436)
301,337
-
-
-
-
-
426,408
(651,354)
capital surplus
-
-
-
-
-
-
-
-
(651,354)
(344,570)
-
(211,698)
-
-
(897,511)
-
1,453,779
-
-
-
-
-
-
-
-
1,858
1,858
Company’s shares
-
-
6,812
-
-
-
-
-
6,812
-
-
1,013,553
-
-
-
-
-
1,013,553
-
-
-
-
-
-
(558,615)
-
(558,615)
- 14,688,280
3,254,424
-
8,144,108
(81,754)
(77,336) 49,077,863
- (5,225,571)
-
- (5,225,571)
Treasury stock retired
Net loss for 2005
Company Financials
Common Convertible
Stock Bonds Applied
for Conversion
23,150,141
-
-
-
-
Legal reserve
-
-
-
761,929
-
(761,929)
-
-
-
Special reserve
-
-
-
-
81,754
(81,754)
-
-
-
1,513,755
-
-
-
- (1,513,755)
-
-
-
Cash dividends
-
-
-
-
- (3,473,263)
-
- (3,473,263)
-
-
-
-
-
(152,170)
-
-
(152,170)
-
-
-
-
-
(54,205)
-
-
(54,205)
22,826
13,063
61,598
-
-
-
-
-
97,487
-
4,642,713
capital surplus
Issuance of common stock by GDR
1,500,000
-
3,142,713
-
-
-
-
-
-
-
-
-
-
- (1,759,157) (1,759,157)
-
-
-
-
-
-
-
(833)
(833)
Company’s shares
-
-
5,620
-
-
-
-
-
5,620
-
-
676,137
-
-
80,130
-
-
756,267
-
-
-
-
--
-
516,514
-
516,514
13,063 18,574,348
4,016,353
26,186,722
81,754 (3,038,409)
434,760 (1,837,326) 44,431,265
2005 Annual Report
43
BenQ Corporation
Non-consolidated Statements of Cash Flows
Years ended December 31, 2003,2004 and 2005 (expressed in thousands of New Taiwan dollars and US dollars)
2003
NT$
Cash flows from operating activities:
Net income (loss)
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation
Amortization
Change in provision for bad debt
Change in provision for inventory obsolescence
Investment loss (income) on long-term equity investments, net
Cash dividends received from investees accounted for by equity method
Loss (gain) on disposal of long-term equity investments, net
Gain on disposal of short-term investments
Impairment loss on long-term investment
Loss (gain) on disposal of property, plant and equipment, net
Faxed assets shortage per physical count
Fixed assets transferred to expenses
Unrealized foreign exchange loss (gain) on overseas convertible bonds
Reversal for redemption of overseas convertible bonds
Impairment loss
Amortization of bond issuance costs
Differences in accounts in the accompanying balance sheets:
Receivables from related parties
Inventories
Prepaid expenses and other current assets
Deferred income tax assets
Payables to related parties
Deferred inter-company profits
Income tax payables
Other liabilities
Net cash provided by (used in) operating activities
Cash flows from investing activities:
Increase in long-term equity investments
Decrease (increase) in short-term investments
Additions to property, plant and equipment
Proceeds from disposal of long-term equity investments
Proceeds from disposal of property, plant and equipment
Increase in refundable deposits and deferred assets
Receipt from investees’ capital reduction
Cash inflow as a result of BMS merger
Cash paid for acquisition of Siemens’ mobile division
Net cash provided by (used in) investing activities
Cash flows from financing activities:
Increase (decrease) in short-term borrowings
Decrease in long-term debt
Redemption of convertible bonds
Increase in treasury stock
Issuance of bonds
Payment of cash dividends
Bonuses for employees
Net cash provided by (used in) financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Additional disclosure of cash flow information:
Cash paid during the year for:
Interest, excluding capitalized interest
Income taxes
Supplemental disclosure of non-cash investing and financing activities:
Change in capital surplus from long-term equity investments
Change in translation adjustment
Convertible bonds converted to common stock and capital surplus
44
2005 Annual Report
2004
NT$
2005
NT$
US$
7,500,095
7,619,288
(5,225,571)
(159,316)
567,446
96,092
1,068
101,025
(3,722,494)
322,528
(5,850)
(247,061)
24,136
865
2,400
(30,361)
(20,037)
4,605
546,988
66,409
(20,184)
(78,094)
(3,563,548)
1,015,008
2,478
(384,753)
350,000
16,019
158
(22,578)
(10,509)
1,067
490,069
185,156
239,277
(65,263)
5,490,018
1,167,779
(8,055)
(1,779,304)
149,307
(4,608)
5,026
(6,733)
18,598
1,767
14,941
5,645
7,295
(1,990)
167,379
35,603
(245)
(54,247)
4,552
(140)
153
(205)
567
54
(2,103,226)
(5,713,522)
(2,330,851)
(17,351)
(80,483)
(123,896)
909,661
3,294,202
(9,647)
659,521
(704,620)
(19,105)
(1,644,860)
2,841,037
(775,212)
1,682,705
(21,434)
(3,418)
(334,333)
(1,087,798)
(2,787,584)
(162,182)
(1,047,679)
190,343
(19,105)
4,013,089
(1,274,700)
(5,927,352)
(1,656,197)
(435,638)
(255,358)
(96,788)
(1,169,613)
3,392,714
327,325
(272,527)
(251,707)
(19,105)
(6,981,483)
(38,863)
(180,712)
(50,494)
(13,282)
(7,785)
(2,951)
(35,659)
103,436
9,979
(8,309)
(7,674)
(582)
(212,850)
(948,184)
6,555,135
(669,858)
36,788
17,209
(97,334)
114,138
5,007,894
(316,131)
(1,565,760)
(343,109)
5,243
52,829
(64,178)
506,586
215,020
(1,509,500)
(1,323,151)
7,105,766
(221,289)
22,433
28,136
(1,003,886)
64,751
(3,966,600)
706,160
(40,340)
216,639
(6,747)
684
858
(30,606)
1,974
(120,933)
21,529
(588,729)
(40,190)
(2,129,611)
(802,425)
(66,597)
2,000,000
(2,521,577)
(100,000)
(4,249,129)
(886,095)
2,025,668
1,139,573
(200,300)
(651,354)
(67,501)
2,050,000
(4,123,924)
(50,626)
(3,043,705)
(540,116)
1,139,573
599,457
2,635,137
(1,400)
(1,759,157)
(54,205)
4,000,000
4,642,713
(3,473,263)
(152,170)
5,837,655
(437,668)
599,457
161,789
80,340
(43)
(53,633)
(1,653)
121,951
141,546
(105,892)
(4,639)
177,977
(13,344)
18,276
4,932
190,853
947,938
161,760
253,228
404,752
272,511
(184,670)
(289,222)
643,052
1,013,553
(558,615)
426,408
756,267
516,514
97,487
12,340
8,308
0
23,057
15,747
2,972
BenQ Corporation and Subsidiaries
Consolidated Balance Sheets
December 31, 2003, 2004 and 2005 (expressed in thousands of New Taiwan dollars and US dollars)
Property, plant and equipment:
Land
Buildings
Machinery and equipment
Furniture and fixtures
Miscellaneous equipment
Leasehold improvements
Prepayments for plant and equipment
Less: allowance for impairment of fixed assets
Less: accumulated depreciation
Net property, plant and equipment
Other assets:
Refundable deposits
Deferred expenses and other assets
Deferred income tax assets-noncurrent
Total other assets
Total assets
Liabilities and Stockholders’ Equity
Current liabilities:
Short-term borrowings
Current portion of long-term debt
Bonds payable
Total current liabilities
Bonds payable
Long-term debt
Other liabilities
Total liabilities
Stockholders’ equity:
Common stock
Convertible bonds applied for conversion
Capital surplus
Legal reserve
Retained earnings
Translation adjustment
Treasury stock
Minority interest
Total stockholders’ equity
Commitments and contingencies
Total liabilities and stockholders’ equity
2003
NT$
2004
NT$
4,730,777
4,924,930
20,454,217
1,663,264
1,359,189
18,727,921
862,341
1,145,600
53,868,239
3,218,141
6,357,091
19,151,261
2,954,474
1,619,547
17,475,733
1,228,357
713,734
52,718,338
15,491,051
3,011,574
18,502,625
20,375,230
2,039,273
22,414,503
3,164,504
8,942,134
12,959,163
550,999
644,605
359,090
1,724,884
28,345,379
(7,498,321)
20,847,058
3,322,173
8,385,559
14,670,790
691,058
728,329
425,597
3,345,729
31,569,235
(9,621,341)
21,947,894
24,266
1,141,433
404,536
1,570,235
94,788,157
57,385
1,271,890
1,205,019
2,534,294
99,615,029
2003
NT$
2004
NT$
2005
NT$
US$
12,551,610
197,924
37,490,396
1,197,677
21,572,124
33,620,461
5,000,025
970,617
112,600,834
20,982,173
2,504,661
23,486,834
3,139,301
9,898,775
18,735,104
629,047
1,071,598
639,573
3,083,393
37,196,791
(89,685)
(11,811,762)
25,295,344
76,993
3,842,093
1,108,336
5,027,422
166,410,434
Company Financials
Assets
Current assets:
Cash and cash equivalents
Short-term investments
Other financial assets-current
Inventories
Deferred income tax assets-current
Total current assets
Long-term equity investments:
Equity method
Cost or lower-of-cost-or-market method
382,671
6,034
1,143,000
36,514
657,687
1,025,014
152,440
29,592
3,432,952
639,700
76,362
716,062
95,711
301,792
571,192
19,178
32,671
19,499
94,006
1,134,049
(2,734)
(360,115)
771,200
2,347
117,137
33,791
153,275
5,073,489
2005
NT$
US$
4,875,326
477,087
22,980,325
4,837,176
301,700
8,523,620
41,995,234
2,997,351
1,632,989
142,227
46,767,801
3,410,317
523,961
20,643,071
6,249,039
101,400
7,704,191
38,631,979
4,487,855
4,746,883
137,698
48,004,415
10,034,593
1,378,529
53,161,431
6,632,669
1,338,662
32,227,154
104,773,038
7,050,000
5,199,618
2,106,531
119,129,187
305,933
42,028
1,620,775
202,216
40,813
982,535
3,194,300
214,939
158,525
64,223
3,631,987
20,838,612
13,436
20,852,048
13,578,276
2,504,415
8,931,983
476,861
(881,619)
2,558,392
48,020,356
23,150,141
23,150,141
14,688,280
3,254,424
8,144,108
(81,754)
(77,336)
2,532,751
51,610,614
26,186,722
13,063
26,199,785
18,574,348
4,016,353
(3,038,409)
81,754
434,760
(1,837,326)
2,849,982
47,281,247
798,376
398
798,774
566,291
122,450
(92,634)
2,492
13,255
(56,016)
86,890
1,441,502
94,788,157
99,615,029
166,410,434
5,073,489
2005 Annual Report
45
Consolidated Statements of Income
Years ended December 31, 2003, 2004 and 2005
(expressed in thousands of New Taiwan dollars and US dollars except earnings per share)
Net sales
Cost of goods sold
Gross profit
2003
2004
NT$
NT$
2005
NT$
US$
128,224,676
174,740,823
176,778,165
5,389,578
(109,214,343)
(153,943,682)
(161,950,053)
(4,937,501)
19,010,333
20,797,141
14,828,112
452,077
Operating expenses:
Selling
(7,710,533)
(10,162,283)
(14,641,728)
Administrative
(2,659,289)
(2,689,958)
(2,865,335)
(87,358)
Research and development
(3,468,174)
(4,522,975)
(7,705,559)
(234,926)
(13,837,996)
(17,375,216)
(25,212,622)
(768,678)
5,172,337
3,421,925
(10,384,510)
(316,601)
Operating income (loss)
(446,394)
Non-operating income:
Interest income
35,556
71,802
241,227
7,355
2,180,238
4,163,068
2,011,643
61,330
Dividend income
212,109
185,270
142,583
4,347
Gain on disposal of investments, net
706,590
439,356
1,987,464
60,594
Foreign exchange gain, net
206,066
409,510
-
Others
331,334
344,864
2,192,135
66,833
3,671,893
5,613,870
6,575,052
200,459
Investment income recorded under the equity method, net
Non-operating expenses:
Interest expense
(361,178)
(475,537)
(856,482)
(26,112)
Impairment loss on long-term equity investment
(266,134)
(471,879)
(235,201)
(7,171)
Foreign exchange loss, net
-
-
(285,812)
(8,714)
Impairment loss
-
-
(158,598)
(4,835)
(178,433)
(98,921)
(271,015)
(8,263)
(805,745)
(1,046,337)
(1,807,108)
(55,095)
Income (loss) before income taxes and minority interest
8,038,485
7,989,458
(5,616,566)
(171,237)
Income tax expense
(473,281)
(302,957)
(241,669)
(7,368)
Income (loss) before minority interest
7,565,204
7,686,501
(5,858,235)
(178,605)
Net Income (loss)
7,500,095
7,619,288
(5,225,571)
(159,316)
Others
Minority interest in net income (loss)
65,109
67,213
(632,664)
(19,289)
7,565,204
7,686,501
(5,858,235)
(178,605)
Basic earnings (loss) per share
3.24
3.10
(2.12)
(0.065)
Diluted earnings per share
3.18
3.08
-
-
Earnings (loss) per share :
46
2005 Annual Report
Consolidated Statements of Changes in Stockholders' Equity
Years ended December 31, 2003,2004 and 2005 (expressed in thousands of New Taiwan dollars)
NT$
Balance at January 1, 2003
Net income for 2003
NT$
Capital
Surplus
Legal
Reserve
Special
Reserve
Retained Translation
Earnings Adjustment
(Loss)
Treasury
Stock
Minority
Equity
NT$
NT$
NT$
NT$
NT$
Total
NT$
NT$
- 13,296,073 1,764,452
- 8,721,127
766,083
(79,923) 1,789,836 43,068,158
-
-
-
-
- 7,500,095
-
-
-
16,810,510
Company Financials
Common Convertible
Stock
Bonds
Applied for
Conversion
NT$
65,109 7,565,204
Legal reserve
-
-
-
739,963
(739,963)
-
-
-
-
3,861,102
-
-
-
- (3,861,102)
-
-
-
-
Cash dividends
-
-
-
-
- (2,521,577)
-
-
- (2,521,577)
-
-
-
-
-
(100,000)
-
-
-
(100,000)
-
-
-
-
-
(66,597)
-
-
-
(66,597)
167,000
13,436
462,616
-
-
-
-
-
-
643,052
Change in Minority equity
-
-
-
-
-
-
-
-
701,848
701,848
-
-
-
-
-
-
-
(802,425)
-
(802,425)
-
-
-
-
-
-
-
729
-
729
Company’s share
-
-
4,257
-
-
-
-
-
-
4,257
-
-
(184,670)
-
-
-
-
-
12,579
(172,091)
-
-
-
-
-
-
(289,222)
-
(10,980)
(300,202)
- 8,931,983
476,861
- 7,619,288
-
-
capital surplus
Net income for 2004
20,838,612
13,436 13,578,276 2,504,415
-
-
-
-
(881,619) 2,558,392 48,020,356
67,213 7,686,501
Legal reserve
-
-
-
750,009
(750,009)
-
-
-
-
2,517,592
-
-
-
- (2,517,592)
-
-
-
-
Cash dividends
-
-
-
-
- (4,123,924)
-
-
- (4,123,924)
-
-
-
-
-
(50,626)
-
-
-
(50,626)
-
-
-
-
-
(67,501)
-
-
-
(67,501)
138,507
(13,436)
301,337
-
-
-
-
-
-
426,408
Change in minority equity
-
-
-
-
-
-
-
-
(98,064)
(98,064)
-
-
-
-
-
-
-
(651,354)
-
(651,354)
capital surplus
Treasury stock retired
(344,570)
-
(211,698)
-
-
(897,511)
- 1,453,779
-
-
-
-
-
-
-
-
-
1,858
-
1,858
Company’s shares
-
-
6,812
-
-
-
-
-
-
6,812
-
- 1,013,553
-
-
-
-
-
-
-
-
-
-
(558,615)
-
- 14,688,280 3,254,424
- 8,144,108
(81,754)
-
-
-
- (5,225,571)
-
-
Legal reserve
-
-
-
761,929
-
(761,929)
-
-
-
-
Special reserve
-
-
-
-
81,754
81,754
-
-
-
-
1,513,755
-
-
-
- (1,513,755)
-
-
-
-
Cash dividends
-
-
-
-
- (3,473,263)
-
-
- (3,473,263)
-
-
-
-
-
(152,170)
-
-
-
(152,170)
-
-
-
-
-
(54,205)
-
-
-
(54,205)
22,826
13,063
61,598
-
-
-
-
-
-
97,487
-
-
58,272
58,272
Net loss for 2005
23,150,141
-
63,801 1,077,354
(58,591)
(617,206)
(77,336) 2,532,751 51,610,614
(632,664) (5,858,235)
capital surplus
Change in minority equity
1,500,000
-
-
-
-
-
-
3,142,713
-
-
-
-
-
- 4,642,713
-
-
-
-
-
-
- (1,759,157)
- (1,759,157)
-
-
-
-
-
-
-
(833)
-
(833)
Company’s shares
-
-
5,620
-
-
-
-
-
-
5,620
-
-
676,137
-
-
80,130
-
-
16,381
772,648
-
-
-
-
-
-
516,514
-
45,175
561,689
Effect of new consolidated subsidiaries
-
-
-
-
-
-
-
-
830,067
830,067
26,186,722
13,063 18,574,348 4,016,353
81,754 (3,038,409)
434,760 (1,837,326) 2,849,982 47,281,247
2005 Annual Report
47
Consolidated Statements of Cash Flows
Years ended December 31, 2003,2004 and 2005 (expressed in thousands of New Taiwan dollars and US dollars)
2003
NT$
Cash flows from operating activities:
Net income (loss)
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation
Amortization
Amortization of negative goodwill by merger
Impairment loss
Impairment loss of other assets
Loss on disposal of property, plant and equipment
Fixed assets transferred to expenses
Unrealized foreign exchange loss (gain) on overseas convertible bonds
Loss on physical count of property, plant and equipment
Gain on disposal of short-term investments
Gain on disposal of long-term investments
Impairment loss on long-term investment
Loss on disposal of common stock of consolidated subsidiaries
Investment income on long-term equity investments, net
Cash dividends received from investees accounted for by equity method
Reversal for redemption of overseas convertible bonds
Amortization of bond issuance costs
Differences in accounts in the accompanying balance sheets:
Inventories
Deferred income tax assets
Other liabilities
Deferred income tax liabilities
Net cash provided by (used in) operating activities
Cash flows from investing activities:
Proceeds from disposal of property, plant and equipment
Additions to property, plant and equipment
Increase in deferred expenses and other assets
Proceeds from disposal of long-term equity investments
Increase in long-term equity investments
Proceeds from disposal of common stock of consolidated subsidiaries
Increase in common stock of consolidated subsidiaries
Receipt from investees’ capital reduction
Decrease (increase) in short-term investments
Net cash provided by (used in) investing activities
Cash flows from financing activities:
Payment for cash dividends
Bonuses for employee
Increase (decrease) in short-term borrowings
Increase in long-term debt
Issuance of bonds
Redemption of bonds
Increase (decrease) in minority interest
Increase in treasury stock
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Effect of new consolidated subsidiaries
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Supplemental disclosure of cash flow information:
Cash paid during the year for:
Interest, excluding capitalized interest
Income taxes
Supplemental disclosure of non-cash investing and financing activities:
Convertible bonds converted to common stock and capital surplus
48
2005 Annual Report
2004
NT$
2005
NT$
US$
7,565,204
7,686,501
(5,858,235)
(178,605)
2,361,880
199,560
67,277
6,603
(30,361)
865
(397,605)
(314,040)
269,317
5,055
(2,180,238)
302,305
(20,037)
5,770
2,863,015
154,087
12,686
38,012
3,941
(22,578)
(405,605)
(33,750)
471,879
(4,163,068)
917,217
(10,509)
2,233
3,023,577
449,294
(1,407,000)
158,598
38,522
87,550
5,026
(1,789,927)
(151,758)
235,201
(2,011,643)
1,148,856
(6,733)
2,933
(5,372,978)
(993,120)
(5,601,303)
(523,464)
(32,947)
5,425,130
1,560,337
404,221
67,803
37,754
2,812,988
1,302,956
(1,291,210)
1,252,188
(260,658)
(366,016)
(368,617)
(2,337,254)
1,424,117
(819,429)
4,630
10,566
6,065,334
(18,339,135)
1,756,797
(16,144,728)
(4,142,815)
(2,341,268)
(160,200)
32,529,785
449,441
8,570,890
1,967,157
(1,929,815)
92,182
13,698
(42,896)
4,835
1,174
2,669
153
(54,571)
(4,627)
7,171
(61,330)
35,026
(205)
89
0
(559,120)
53,561
(492,217)
(126,305)
(71,380)
(4,884)
991,762
13,702
261,308
59,974
(58,836)
406,697
(4,958,721)
(242,348)
662,461
(1,203,830)
84,425
4,560
114,138
5,837,457
704,839
160,257
(5,007,614)
(73,824)
122,299
(775,282)
539,510
(1,030,884)
(6,065,538)
216,778
(6,534,704)
(2,945,945)
281,472
(547,827)
15,298
7,950,556
(1,564,372)
6,609
(199,229)
(89,815)
8,582
(16,702)
466
242,395
(47,694)
(2,517,320)
(100,000)
250,573
249,113
2,000,000
(2,229,611)
(66,597)
490,905
(802,425)
(2,725,362)
(186,393)
606,072
4,124,705
4,730,777
(4,123,924)
(50,626)
(1,465,009)
3,160,768
2,050,000
(300,300)
(67,501)
(98,064)
(651,354)
(1,546,010)
33,578
(1,512,636)
4,730,777
3,218,141
(3,473,263)
(152,170)
6,624,276
1,307,303
4,642,713
4,000,000
(101,400)
(54,205)
58,272
(1,759,157)
11,092,369
123,423
1,611,864
9,333,469
3,218,141
12,551,610
(105,892)
(4,639)
201,960
39,857
141,546
121,951
(3,092)
(1,653)
1,777
(53,633)
338,182
3,763
49,142
284,557
98,114
382,671
360,618
1,082,469
330,517
440,847
795,560
418,001
24,255
12,744
643,052
426,408
97,487
2,972
BenQ Fact Sheet
Founded
21 April, 1984
Paid-In Capital
USD 798 Million
Revenue
2004: USD 5.1 Billion 2005: USD 5.04 Billion
Chairman
K.Y. Lee
Management Team
Executive Management: K.Y. Lee, Sheaffer Lee, Jerry Wang, Eric KY Yu, Jeff CH Li, Rick Lei
Business Management: Hermit Huang, Irwin Chen, Peter Chen, Clemens Joos
Regional Operations Management: Adrian Chang, Conway Lee, Michael Tseng, Ben Chu
Corporate Vision
Bringing Enjoyment and Quality to Life
Product Focus
Networked Digital Lifestyle Devices
Computing Products Business Group:
■LCD Monitor: 15”, 17”, 19”, 20.1”, 23” wide screen (BenQ third largest LCD monitor maker worldwide)
■Joybook wide screen series laptop PC: 12”, 13”, 14”, 15.4”, 17” wide screen
■Optical storage product: CD-ROM, CD-RW, DVD-ROM, DVD+RW, Combi
■Imaging products: multi-function peripheral, multi-function printers (MFP) and scanners (e third largest scanner maker worldwide)
Digital Media Business Group:
■Digital Projector: Digital Projector (data & video)
■LCD TV: 15”, 20”, 26”, 30”, 32”, 37”, 42”, 46” LCD TV, 72” Rear Projection TV
■Personal AV: Joybee MP3 audio player
■Digital Camera: 2 ~8 Mega Pixels digital cameras
■Car Displays
Mobile Business Group:
■Mobile phone: GSM/GPRS mobile phones, CDMA/CDMA 2000/W-CDMA mobile phones, smart phones, PDA phones, 3G mobile phones
■Wireless Communication: GPRS+WiFi combo products, wireless modules
Sales Offices
4 Regional Operations, 72 Sales & Branch Offices Worldwide ( *BenQ Mobile Sales Offices)
■Europe Regional HQ Sales Office: e Netherlands (Eindhoven), Germany* (Munich), Austria* (Vienna)
Benelux, Germany, UK, France, Italy, Spain, Portugal, Switzerland, Russia, Austria, Greece*, Macedonia*, Cyprus*, Ireland*, Hungary*,
Poland*, Romania*, Demark*, Norway*, Sweden*, Finland*, Czech Republic*, Slovakia*, Bulgaria*, Ukraine*, Estonia*, Lithuania*, Latvia*,
Slovenia*, Kazakhstan*, Serbia*, Albania*, Croatia*
■e Americas Regional HQ Sales Office: USA (Irvine, CA), Brazil* (Sao Paulo)
USA, Canada, Mexico, Brazil, Argentina*, Chile*, Costa Rica*, El Salvador*, Peru*, Columbia*, Ecuador*, Guatemala*, Venezuela*
■China Regional HQ Sales Office: China (Suzhou)
Suzhou, Beijing, Shanghai, Chengdu, Guangzhou, Wuhan, Shenyang, Xian, Hong Kong, Shenzhen, Harbin
■AMEA (Asia Pacific, Middle East, Africa)* Sales Region: Taiwan (Taipei)
Taiwan, Malaysia, India, ailand, Singapore, Japan, Korea, UAE (Dubai) , Turkey, Australia (New Zealand)
Manufacturing
Operations
■Taoyuan, Taiwan
■Mexicali, Mexico
■Suzhou, China
■Manaus, Brazil
■Shanghai, China
■Penang, Malaysia
■Kamp-Lintfort, Germany
Patents
3,324 global patents, 2,749 patents pending (04/2006)
Quality Certifications ■Taoyuan Plant (Taiwan): ISO-9000, ISO-14000, ODC, OHSAS 18001, TL-9000
■Suzhou Plant (China): ISO-9000, ISO-14000, ODC , TL-9000, OHSAS 18001
■Penang Plant (Malaysia): ISO-9000, ISO-14000, ODC
■Mexicali Plant (Mexico): ISO-9000, ISO-14000, OHSAS 18001
No. of Employees
Sales by Geography &
Percentages
Market Share
19,765 employees (BenQ Mobile: 8,055) in over 70 countries (04/2006)
- Taiwan (3,270), China (9,425), Malaysia (196), Other regions (7,000+)
- Including R&D personnel (4,000)
China
the Americas
Europe
APAM*
Total
2005 (%)
18
35
28
19
100
2004 (%)
15
30
31
24
100
2003 (%)
21
18
29
32
100
Products
LCD Monitor
Projector
Storage
Scanner
Mobile Phone
Market Shares (%) in 2005
9.5 %
14.0 %
12 %
24.0 %
5%
BenQ Group of
Companies
BenQ Corporation, AU Optronics Corporation, Daxon Technology Inc., Darfon Electronics Corporation, Cando Corporation, Airoha
Technology Corporation, BenQ Guru Soware Co., Ltd, Philips BenQ Digital Storage and Raydium Semiconductor Corporation
Recognitions /
Achievements
■Received 11 Red Dot Design Award 2006 (March 2006)
■Awarded 17 iF Design Awards and one much-coveted Gold Award 2006 (March 2006)
■Interbrand’s Top 10 Global Taiwan Brands Survey: Ranking 4th (Oct. 2005)
■Received 11 Good Design Awards 2005 (Oct. 2005)
■Feature Company / Story on cover of May 2005 edition of Business Week magazine
■Awarded 21 iF China Design Award 2005 (May 2005)
■Received 6 Red Dot Design Award 2005 (March 2005)

2005 Annual Report(PDF/2823KB)

Transcription

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