Local electronic component maker Lite-On Technology Inc (光寶科技) yesterday posted a 51 percent higher net profit for the second quarter year-on-year, thanks to resilient demand for end products such as computers and smartphones.
Net income soared to NT$2.46 billion (US$76.74 million), or NT$1.12 per share, in the quarter ending June 30, compared with NT$1.63 billion, or NT$0.75 a share, during the same period last year. That also meant a 36.3 percent quarter-on-quarter growth from a net profit of NT$1.81 billion in the first quarter of this year.
Revenues expanded 42.6 percent year-on-year, or 12.8 percent quarter-on-quarter, to NT$32.35 billion, primary from power supply units, LED modules, camera modules for mobile phones and keyboards for laptop computers.
Growth in the third quarter is expected to weaken to low-single digits, Lite-On chief executive officer Terng Kuang-chung (滕光中) told a media briefing.
“Demand is weaker than people thought. [Demand for] notebook computers is a major factor,” Terng said, adding that demand for laptops started dipping last month.
“We are seeing better inventory digestion to spur demand for smarphones, set-box and some consumer electronics, but we don’t have a clear picture about TV demand,” he said.
Terng said he did not see “any exciting signs,” and he expected growth in the third and fourth quarters would be minimal.
Despite unfavorable macroeconomic conditions, Lite-On expected its gross margin to continue to increase in the current quarter from 13 percent last quarter, on the back of better operation efficiency after completing the integration of its Chinese factories.
Overall it would “not be difficult” to report better net profits in the second quarter compared with net income from the first half, during which Lite-On earned a total of NT$4.27 billion, or NT$1.94 per share, Terng said.
In the long term, it would be Lite-On’s priority to expand its annual revenue to NT$180 billion as soon as possible, Terng said, adding that the company would have to grow at an annual rate of 20 percent or 25 percent over the next few years.
Last year, Lite-On made NT$97.2 billion in revenues.
Camera modules, power supply units and white LED modules would be the company’s major driving forces, Terng said.
Lite-On is building a new factory to massively expand white LED module capacity, Terng said. Sales from white LED modules are expected to increase by NT$300 million to NT$400 million a month after the new plant starts mass production in February next year, he said.
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