Chi Mei Optoelectronics Corp (奇美電子), the nation’s second-largest liquid-crystal-display (LCD) panel maker, said yesterday it expected second-quarter shipments of PC and TV panels to rise from the previous three months.
“This quarter’s demand will continue to be strong like the first quarter, which was surprisingly strong for a historically slow season. I expect shipments [this quarter] to rise by more than 15 percent,” company president Ho Jau-yang (何昭陽) said at an investor conference yesterday.
The company expects shipments of panels for laptops and monitors to grow by between 15 percent and 20 percent this quarter from the previous three months, while those for TVs would see an increase of between 5 percent and 10 percent.
However, blended average selling prices (ASP) could fall between 3 percent and 5 percent this quarter from last quarter, as ASPs for TV screens are expected to decline by 5 percent, offsetting the forecast 1 percent to 2 percent increase in ASPs for laptops and monitors.
With ASPs declining, Chi Mei’s first-quarter net income fell 24.2 percent to NT$15.3 billion (US$503 million) from NT$20.18 billion in the fourth quarter. Earnings per share were NT$2.22 last quarter, down from NT$2.95 in the fourth quarter, while gross margin slid to 25 percent from 27 percent in the fourth quarter, the company’s latest data showed.
An analyst, who wished to remain anonymous, said he was worried about the company’s increasing inventory levels which, according to the company’s finance director, Denis Chen (陳世賢), increased to NT$38.27 billion in the first quarter from NT$31.21 billion in the fourth quarter.
“If demand this quarter is not as strong as expected, Chi Mei will have to lower its prices to stimulate sales,” the analyst said.
But if Chi Mei’s shipments were to increase by 15 percent and gross margin were to reach 25 percent as the company had forecast, its earnings would increase by between 10 percent and 15 percent this quarter, he said.
Capital expenditure in the first quarter rose 29.8 percent to NT$28.03 billion, from NT$21.6 billion a year ago.
About NT$23 billion of the capital expenditure was invested in Taiwan, while the remainder was used for the expansion of module plants in China, Chen said.
The Tainan-based manufacturer has two LCD plants in Ningbo and Nanhai in China.
Asked about the company’s plan to invest in a TV and computer panel assembly line in Hanoi, Vietnam, Ho said Chi Mei would cooperate with local laptop computer maker Wistron Corp (緯創) and other firms to begin land development, which should take place in the third quarter of this year.
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