Acer Inc, which gets about 70 percent of its sales from Europe, probably had its first profit increase in three quarters as the company gained market share and benefited from a stronger euro.
Fourth-quarter profit probably climbed to NT$2.46 billion (US$77 million) from NT$1.4 billion a year earlier, based on the median in a Bloomberg News survey of six analysts.
Sales rose 43 percent to NT$45 billion at the company, which industry researcher IDC said overtook Fujitsu Siemens Computers Holdings BV as the world's fourth-biggest personal computer maker in the period. Acer is set to release earnings this month.
The company, the nation's third-biggest computer maker by market value, has been expanding in Europe, such as adding 300 dealers in Germany a month to buy its products for resale.
IDC said Acer's global market share rose to 4.3 percent from 3.7 percent a year earlier, with shipments jumping a third.
"Acer's doing a good job in Europe," said Kevin Huang, an analyst at Macquarie Securities Ltd in Taipei. "A stronger euro is a plus."
The euro rose 9 percent against the US dollar in the fourth quarter. The NT dollar rose 6.1 percent against the greenback in the period. The bigger gain by the euro probably boosted Acer's earnings when overseas sales were repatriated.
Acer shares jumped 14 percent in the fourth quarter, outstripping a 5 percent gain by the TAIEX in the period.
Besides signing up more dealers, Acer has been cultivating its brand name in Europe, where the company in 2003 sponsored the Ferrari Formula One motor-racing team. Last September Acer appointed Milan-based Gianfranco Lanci as president.
Worldwide personal-computer shipments, including notebook, desktop, portable and servers, rose 13.7 percent in the fourth quarter as business demand and growth in key regions like Europe, the Middle East and Africa continue to drive the market, according to IDC.
For last year, Acer had 360 percent growth in Saudi Arabia, making it the No. 1 supplier of notebooks in that country, accounting for about one in four sold there, AME Info reported last month.
Acer plans to expand its product range in the Middle East with the introduction of digital cameras and liquid-crystal display televisions, the report said.
Apart from Europe, sales from China accounted for about 11 percent of Acer's sales in the first nine months ended Sept. 30.
About 16 percent came from the Asia-Pacific region and pan-American region contributed the remaining in the period.
Operating income, or the amount Acer earned from its business, may have risen 30 percent to NT$1.4 billion in the fourth quarter, from NT$1.08 billion a year earlier, according to analysts.
Lower costs of PC components, such as liquid-crystal displays and drives, helped boost rival Dell Inc's third-quarter profit and are likely to improve margins in the fourth quarter, Dell's chief financial officer Jim Schneider said on a call with analysts on Nov. 11. Dell is the world's biggest personal computers vendor, according to IDC.
"On the operating level, falling components prices also helped lift Acer's operating margins," Huang said.
Acer's operating margin, the percentage of sales left after deducting production costs, is expected to improve to 1.8 percent in the fourth quarter, from 1.7 percent in the previous three months, Huang said.
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