Thu, Jan 25, 2007 - Page 12 News List

Nanya Technology Corp reports record earnings

By Lisa Wang  /  STAFF REPORTER

Nanya Technology Corp (南亞科技), Taiwan's second-biggest maker of computer memory chips, yesterday said quarterly earnings jumped to a record high for the third quarter in a row as growing demand drove prices up 36 percent annually.

Net income spiked at NT$6.47 billion (US$197.3 million), or NT$1.7 per share, during the fourth quarter of last year, compared to an audited NT$292 million, or NT$0.07 a share, a year ago. Revenues more than doubled to NT$22.33 billion in the fourth quarter from a year earlier.

Gross margin was 37 percent in the fourth quarter, up from 32 percent in the third quarter and 19 percent a year earlier, the company said.

Nanya Technology expected revenues to increase further during the first quarter, fueled by demand for Vista-compatible computers and the Lunar New Year shopping season.

"Sales of Microsoft Corp's Vista system and PC makers' promotion sales in China will help stabilize memory price," said Pai Pei-lin (白培霖), a vice president of Nanya Technology.

Pai expected the contract price for computer memory chips, or dynamic random access memory (DRAM) chips, to slide by between 5 percent and 10 percent next month, after a drastic price decline on the spot market recently on weak demand for white-box computers.

In only a week, the price of a benchmark DDR2 512Mb slid 24 percent to US$3.9 per unit on the spot market, according to market researcher DRAMeXchange.

In the last quarter, DRAM prices rose 36 percent year on year as customers, mostly computer makers, were preparing Vista-compatible computers ahead of the sale of the new operating system at the end of this month, Pai said.

Shipments would climb to more than 20 percent in the January to March period from three months ago to meet growing demand, Pai said. For the whole year, growth would be about 70 percent, he added.

Like rival Powerchip Semiconductor Corp (力晶半導體), last year was also the most lucrative year for Nanya Technology as net income increased to a record high of NT$17.41 billion, or NT$4.55 per share, compared to NT$2.33 billion, or NT$0.61 a share in 2005.

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