Thu, Jul 19, 2007 - Page 12 News List

Prime View profits explode by 700% on robust demand

By Lisa Wang  /  STAFF REPORTER

Prime View International Co (元太科技), a local maker of flat panels for consumer electronics, yesterday said second quarter profits had soared to more than seven times its profits from a year ago, driven by booming demand for its high-margin products.

Pre-tax profits were NT$279.43 million (US$8.51 million) in the second quarter compared with NT$34.26 million a year earlier, Prime View said.

"That proves our strategy of shifting focus to higher-margin products is effective," company chairman Scott Liu (劉思誠) said.

Prime View attributed the growth to booming shipments of slim screens used in the aviation industry and industrial computers, which produced margins 17 percent higher than those earned by shipping consumer electronics such as mobile phones.

Concerning the company's outlook, "we are very optimistic about profit growth in the third quarter," Liu said.

The panel maker reported a gross margin of 16.7 percent in the second quarter, compared with 5.33 percent in the same period last year.

Pre-tax profits should leap in the third quarter, driven by growing demand for the company's new flexible displays and for small and medium liquid-crystal-display (LCD) panels, Liu said.

Prime View, the world's sole flexible-display supplier, has more than 22 customers, including Japan's Sony Corp. The Hsinchu-based company expects the business, which represents a minimal portion of revenues, to produce a larger share of revenues in the second half of the year.

Prime View earned NT$422 million in pre-tax profits in the first half of the year, more than double the figure from the same period last year. Revenues, however, dropped around 15 percent year-on-year to NT$4.3 billion.

Shares of Prime View rallied to the nearly 7 percent daily limit, closing at NT$56.1 yesterday on the GRETAI Securities Market as a result of increasing prices for LCD panels on strong demand for consumer electronic devices such as digital photo frames.

"The price for small and medium panels dropped 20 percent to 25 percent annually in recent years, but this year we are not worried because prices are rising on robust demand," Liu said.

Prime View said the production rate at its panel assembling factory in China would rise to full capacity this month on seasonal demand from as high as 80 percent last quarter.

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