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Qisda profits up for third straight month

Local electronics maker Qisda Corp (佳世達) yesterday posted a third straight quarter of profits because of massive asset gains, mostly from its panel-manufacturing arm, as AU Optronics Corp (友達光電) gradually recovers from its abortive takeover of Siemens AG's handset unit.

Seven months ago, Qisda spun off the BenQ (明基) brand business, which had been held back by the money-losing mobile unit from Siemens. It refocused its business on its strength in manufacturing consumer electronics such as computer monitors and TVs for other companies.

Net profit amounted to NT$3.13 billion (US$101 million) in the fourth quarter of last year, compared with losses of NT$7.89 billion a year ago. Non-operating gains amounted to NT$3.76 billion, with NT$2.4 billion from the nation's top panel maker AU Optronics.

Qisda holds a 7.8 percent stake in AU Optronics.

Operating losses shrank from NT$1.7 billion to roughly NT$660 million, but investors still wanted to know when the firm would return to the black without counting on asset gains.

"I cannot give you a timetable now, but one of our top priorities is to break even this year in terms of operating level. The bottom line will improve quarter by quarter," Qisda president Hsiung Hui (熊暉), a former AU Optronics vice president, told investors.

Asset gains, however, would still be a major profit source this year, Hsiung said.

Hsiung said Qisda hoped to improve operation efficiency and to reach an optimal cost structure by strengthening cooperation with AU Optronics. Initially that would mean supplying and assembling PC monitors and TVs.

A sufficient supply of liquid-crystal-display (LCD) panels has helped Qisda gain new customers, Hsiung said.

Panel supplies would be tight this year in line with major panel suppliers' forecasts, he said.

PC monitors and LCD TVs would grow the fastest with shipments rising to 18 million units and 2 million units this year, from 12 million and 400,000 units respectively last year, as the company broadens its customer portfolios, Qisda said.

"End demand for consumer electronics in the first quarter did not drop as fast as it used to, though the macroeconomy is under the shadow of the US sub-prime crisis," Qisda chairman Lee Kun-yao (李焜耀) said.

Revenues would slide 2 percent to 3 percent this quarter, from NT$30.89 billion in the final quarter of last year, during which PC monitors made up a 68 percent portion. LCD TVs contributed less than 4 percent.

Looking to the second quarter, Hsiung said: "We have not seen any negative impact from the sub-prime crisis yet in end demand, or customer side ... Qisda expects an uptrend [in shipments]."

Shipments of monitors and LCD TVs would grow as it started shipping products to new customers, Qisda said.

Commenting on impact from a fire at rival Lite-On Technology Corp's (光寶科技) Chinese plant, Hsiung said Qisda has obtained extra orders for monitors and the effect would be reflected in next quarter's operation report.

Qisda shares jumped 4.17 percent, or NT$1.2, to NT$30, out-performing the benchmark TAIEX, which advanced 2.63 percent.
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