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Acer posts large first quarter gain in profits

Acer Inc, the world's third-largest computer supplier, posted a 41 percent gain in first quarter profit yesterday, its first increase in three quarters, after booked profits from its investments and gained market share.

Net income rose to NT$5.66 billion (US$170 million), or NT$2.47 a share, from NT$4.02 billion, or NT$1.82 a share, a year ago, the company said in an e-mailed statement.

Acer posted a 30 percent gain in non-operating income from its investments. Company president Gianfranco Lanci has guided Acer to become the world's third-largest computer supplier ahead of Lenovo Group Ltd (聯想) because of its policy of price cuts.

"The market-share strategy is a path of no return and hopefully it will lead to improved profits later," Michael On, a fund manager at Beyond Asset Management Co in Taipei, said before the earnings were announced.

Non-operating income rose to NT$4.3 billion from NT$3.3 billion a year earlier on the sale of share holdings in Taiwan Semiconductor Manufacturing Co (台積電), Hon Hai Precision Industry Co (鴻海精密), and Wistron Corp (緯創), spokesman Henry Wang (汪島雄) said by telephone.

Consolidated sales rose 20 percent to NT$99.5 billion. Operating income, which measures sales minus the cost of goods sold and administrative expenses, increased 1.1 percent to NT$1.95 billion.

Acer, the fastest-growing of the top five computer sellers, made 6.8 percent of worldwide shipments in the first quarter, overtaking Lenovo, which had 6.3 percent, according to research firm Gartner Inc.

Shares of Acer have declined 4.6 percent this year and closed at NT$64.9 yesterday, lagging a 2.3 percent gain in the benchmark TAIEX.
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