The total output value of all PCB products in the first half of 2019 was NT$288.2 billion, showing a minor increase of 0.1% compared with the first half of 2018. As affected by the reduction in mobile phone shipments and the decline of global economic growth in Q1 in 2019, it is clear that customers have adjusted their inventory measures. Therefore, there is an annual decline of 3.4% in Q1 in 2019. Fortunately, the decline in Q1 has almost been compensated in full by the active shipments that occurred in Q2, resulting in the output value in the first half of the year being nearly the same as that of 2018. If we are to view the performance by individual products, rigid board products performed the best, followed by SLP, while soft board products performed the worst.

 

           Along with the gradual growth of revenue in Q2, the gross profit margin of each product category has, in all, increased when compared to Q1under the fixed depreciation expense, as well as the proportion of increase with the cost of goods sold at lower than the proportion of revenue growth. As a total, the gross profit margin of soft board products was 16.1% in the first half of 2019 and is considered the best, while there is also some improvement in rigid board products as it reached 14% in Q1. As for SLP, its gross profit margin is only 9.1% and is still lower than that of its past average.

 

           Although 2019 is considered the first year for 5G mobile communication, it is estimated that before the preliminary stage of 5G infrastructure starts in 2018, the relevant market size will only be approximately US$32.4 billion. In addition to the market value created by the continued deployment of hardware facilities, such as base stations in 2025, the market opportunity is only expected to reach approximately UST123.3 billion, including smartphones or other 5G applications. Consequently, 5G business opportunities are going to be a long-running race. In 2019, the business opportunities for down-to-earth 5G PCB in Taiwan is expected to be similar to related hard boards and substrates for base stations. In other words, after Taiwan has experienced 2 years of continuous growth with its PCB industry, the output value faces a critical moment of growth and decline in the absence of large-scale and overall growth factors. If terminal demands do, in fact, deteriorate in the second half of the year, the output value is expected to reach NT$652.8 billion in 2019, with a small increase of 0.2%.