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Acer's profits surge so far

Sales figures * Acer had NT$31.96 billion in sales to the end of last month. * Sales were NT$50.05 billion from January to September last year.

Acer Inc (宏電) reported an after-tax profit of NT$5.01 billion for the first three quarters on Monday -- more than eight times last year's figure -- despite a drop in sales revenues from the same period last year.

Acer attributed the increased profitability to "effective restructuring" within the Acer Group.

In March, Acer moved its production operations to China and separated its manufacturing and brand-name businesses. At the same time it merged with its former Taiwan sales arm, Acer Sertek Inc (宏科). Its manufacturing business is now run by Wistron Corp (緯創資通).

The company also said it achieved NT$31.96 billion in sales to the end of last month, compared to NT$50.05 billion from January to September 2001. However last year's first through third quarter profit was only NT$619 million.

The figures may be deceptive.

"This is an accounting adjustment. If you try to compare with last year, the numbers are not exactly the same," said Eve Jung (戎宜蘋), a PC systems analyst at ABN-AMRO in Taipei. This year's revenue figures will not include Wistron, and the profit result includes Sertek, so it is like comparing apples and oranges, Jung said.

Jung was upbeat about Acer's long-term prospects now that the restructuring has been completed.

"We are more positive for the new Acer's future," she said. "It is now focusing on branding and this is good for Acer. It is focusing on China and the emerging markets to boost profits."

Acer predicted growth in PC sales of 20 percent to 30 percent in the fourth quarter. Acer's president of operations for the greater China area, Lin Hsien-lang (林顯郎), said yesterday that Acer would ship an additional 140,000 notebook PCs before the end of this year.

Jung, however, said that this figure may be too optimistic under the present economic conditions.

"At this time we are pessimistic about PC demand," Jung said. "We don't see much growth. Acer may be aggressive in China, but whether they can achieve this amount of growth? It may take some time."

Jung did concede that Acer's recent release of new products would boost fourth-quarter sales to some degree.

Acer's current releases include a tablet PC, a new Aspire brand PC, a Chinese-language handheld computer, and a server.
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