Hon Hai Precision Industry Co (鴻海精密), the world’s biggest contract maker of electronics, posted its first profit increase in five quarters, beating analysts’ estimates.
Second-quarter net income rose 27 percent to NT$15.1 billion (US$459 million) from a year earlier. The number was derived from first-half results announced by the Taipei-based company yesterday.
Hon Hai was expected to report profit of NT$11.7 billion, according to the median of 10 analyst estimates compiled by Bloomberg.
Customers including Apple Inc posted rising sales during the April-to-June period, boosting revenue at the Taipei-based company as demand for consumer electronics rebounded. Hon Hai’s profit will decline this quarter, according to analysts’ estimates.
“Hon Hai can maybe boost profit margins if they have a more favorable product mix,” Calvin Huang (黃文堯), an analyst at Daiwa Securities Group Inc (大華證券) in Taipei who rates the company “buy,” said before the earnings announcement.
Sales were little changed from a year earlier at NT$314 billion on an unconsolidated basis, according to Bloomberg’s calculations based on the company’s first-half results.
Hon Hai closed unchanged at NT$111 in Taipei trading before the earnings announcement. The stock has surged 99 percent this year, compared with a 49 percent advance by the benchmark TAIEX index.
HIGHER APPLE SALES
Apple, whose iPods, Mac computers and iPhones are made by Hon Hai, posted a 12 percent increase in sales for the June quarter after it lured customers with price cuts.
Global computer shipments dropped 3.1 percent in the second quarter, better than an expected decline of 6.3 percent, researcher IDC said in a July 15 statement. Consumers’ purchases of PCs buoyed the market, the researcher said.
Hon Hai is expected to post a 15 percent drop in profit this quarter from a year earlier to NT$15.1 billion, the median of eight analyst estimates compiled by Bloomberg showed.
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