2004 July Monthly Highlights

Yuanta Q1 2004 Earnings Release

2004 July Monthly Highlights 

   Business Overview
 


Looking back at the stock market in 2003, the market started out relatively strong in continuance of the stock rally at the end of 2002, but the conflict in Iraq reduced investor confidence significantly. Furthermore, the breakout of SARS (Severe Acute Respiratory Syndrome) in China, Hong Kong, Singapore, Canada and Taiwan crushed trading volume in the second quarter. According to the TSE (Taiwan Securities Exchange), trading volume between March and June averaged only NT$50 to 60 billion per day.

Thankfully, the war in Iraq ended after only 3 months and the spread of SARS was controlled by summer. At the same time signs of a global economic recovery were apparent by the second half of the year. The US economy posted a growth rate of 8.2% in the third quarter, which stimulated rapid growth in the Taiwan Weighted Index through to the end of the year, adding 20.9% from its lowest point.

 

In 2003, Yuanta Core Pacific Securities (Yuanta) posted total revenue of NT$13.8 billion, pre-tax earning of NT$7.2 billion and pre-tax earning per share of NT$2.94, leading its peers. Yuanta¡¦s business overview is as follows:

  • Brokerage: 93 branch offices island-wide with annual average market share of 8.61%.
  • Underwriting: Yuanta was lead manager for 23 domestic deals totaling NT$10.3 billion. Yuanta was also lead manager for 8 overseas deals totaling US$375 million.
  • Proprietary Trading: At the end of 2003, Yuanta held NT$24.7 billion of securities, posting a net profit of NT$811 million on the years trading.
  • Margin Trading: Total margin loans and total stock loans amounted to NT$24 billion and NT$6.9 billion respectively, resulting in interest margin revenue of NT$1.6 billion and margin transaction fees of NT$200 million.
  • Warrants: Yuanta issued 91 warrants through the year, posting a net profit of NT$1.4 billion.
  • Registrar and Transfer Agency: Yuanta represented 64 TSE-listed companies, 45 OTC-listed companies, 13 companies in the Emerging Stock Market and 103 unlisted companies, along with approximately 1.8 million shareholders, and posted revenue of NT$179 million.

Yuanta repeatedly demonstrated excellent performance in all business sectors because of its balanced development strategy and its solid corporate structure. Yuanta has again been acknowledged by world financial media as well as foreign investors for its professionalism, dedication, competitiveness and outstanding performance. "Asiamoney" and "The Asset" both named Yuanta the "top local Asian brokerage house in Taiwan".

Looking into the future, Yuanta will monitor government policy closely as restrictions on investment banking business are being gradually lifted. Yuanta will utilize all its resources to pursue steady profitable growth.

Moreover, to further expand its business scale, Yuanta will evaluate any merger possibilities with commercial banks or financial holding companies that display a similar corporate culture and management approach. In the meantime, Yuanta will devote itself to integrate its subsidiaries to create sustainable synergies and to fully utilizing its exceptional distribution channels in order to generate profitable growth in the years ahead.