Camera lens maker Largan Precision Co (大立光) saw its profits decline for a second quarter in the three months ending on March 31 amid slowing sales owing to the global recession.
First-quarter profit was nearly halved to NT$444 million (US$13 million), or NT$3.41 per share, from NT$803 million, or NT$6.15 per share, in the fourth quarter of last year, Largan said in a filing with the Taiwan Stock Exchange yesterday.
On an annual basis, profits in the first three months dropped 24.5 percent from NT$583 million in the same quarter last year.
The company posted a profit of NT$1.13 billion in the third quarter and NT$722 million in the second quarter of last year, the stock exchange filing and the company’s financial tallies showed.
Largan shares dipped 1.3 percent to NT$260 yesterday, underperforming the benchmark TAIEX, which slid 0.18 percent. The stock has risen 27.8 percent in the year to date, on a par with the TAIEX’s 28 percent rise.
Largan’s falling profit came in the face of weakening sales. Consolidated revenue dropped 30.1 percent sequentially to NT$1.2 billion in the first quarter and 29.8 percent from the same period last year, the Taichung-based company said.
Charles Chiu (邱東泉), Largan’s chief financial officer and spokesman, told a teleconference yesterday that the company’s gross margin dropped to 43.22 percent in the first quarter, from 51.68 percent in the fourth quarter, the first time its quarterly gross margin had fallen below 50 percent in three years.
Chiu attributed shrinking gross margins to falling average selling prices and slowing sales, which offset the positive impact from growing shipments of high-value 3-megapixel phone lenses.
Chiu did not provide a sales guidance for the coming quarters, saying order visibility was low at only one month. But he said that second-quarter revenue would likely be higher than the first quarter.
“First-quarter results likely marked a bottom for Largan’s 2009 earnings,” Citigroup Global Markets analyst Kevin Chang (張凱偉) wrote in a client note yesterday.
“However, with low earnings visibility and high threat of new competition, we maintain our Sell rating as further re-rating is unlikely,” Chang said.
Largan is scheduled to hold a board meeting next week to discuss its dividend plan.
In its stock exchange filing, the company said profits last year reached NT$3.24 billion, or NT$24.92 per share, on revenue of NT$7.48 billion. That compares with profits of NT$2.57 billion and revenues of NT$4.16 billion in 2007.
HORMUZ ISSUE: The US president said he expected crude prices to drop at the end of the war, which he called a ‘minor excursion’ that could continue ‘for a little while’ The United Arab Emirates (UAE) and Kuwait started reducing oil production, as the near-closure of the crucial Strait of Hormuz ripples through energy markets and affects global supply. Abu Dhabi National Oil Co (ADNOC) is “managing offshore production levels to address storage requirements,” the company said in a statement, without giving details. Kuwait Petroleum Corp said it was lowering production at its oil fields and refineries after “Iranian threats against safe passage of ships through the Strait of Hormuz.” The war in the Middle East has all but closed Hormuz, the narrow waterway linking the Persian Gulf to the open seas,
Apple Inc increased iPhone production in India by about 53 percent last year and now makes a quarter of its marquee devices there, reflecting the US company’s efforts to avoid tariffs on China. The company assembled about 55 million iPhones in India last year, up from 36 million a year earlier, people familiar with the matter said, asking not to be named because the numbers aren’t public. Apple makes about 220 million to 230 million iPhones a year globally, with India’s share of the total increasing rapidly. Apple has accelerated its expansion in the world’s most populous country in recent years, bolstered
HEADWINDS: The company said it expects its computer business, as well as consumer electronics and communications segments to see revenue declines due to seasonality Pegatron Corp (和碩) yesterday said it aims to grow its artificial intelligence (AI) server revenue more than 10-fold this year from last year, driven by orders from neocloud solutions clients and large cloud service providers. The electronics manufacturing service provider said AI server revenue growth would be driven primarily by the Nvidia Corp GB300 server platform. Server shipments are expected to increase each quarter this year, with the second half likely to outperform the first half, it said. The AI server market is expected to broaden this year as more inference applications emerge, which would drive demand for system-on-chip, application-specific integrated circuits
PROJECTION: TSMC said it expects strong growth this year, with revenue in US dollars projected to grow by about 30 percent, outperforming the industry Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported consolidated sales last month reached NT$317.66 billion (US$9.98 billion), the highest ever for the month of February, driven by robust demand for chips built using the company’s advanced 3-nanometer (3nm) process. Last month’s figure was up 22.2 percent from a year earlier, but fell 20.8 percent from January, the world’s largest contract chipmaker said in a statement. For the first two months of the year, TSMC posted cumulative sales of NT$718.91 billion, up 29.9 percent from a year earlier. Analysts attributed the growth to sustained global demand for artificial intelligence (AI) products
RSS