Wed, Jun 13, 2012 - Page 12 News List

Nanya forecasts better growth in next quarter

STILL SLOW:Uncertainty about the global economy is affecting consumption, the company said, but it expects losses to improve and demand to pick up

By Lisa Wang  /  Staff reporter

Nanya Technology Corp (南亞科技), the nation’s top PC DRAM chipmaker, yesterday said the next quarter would be a better period than the current quarter on rising seasonal demand, but growth would be slower than usual as a precarious macroeconomy would curtail spending.

This quarter, losses would improve further, compared with last quarter, on the back of an upward spiral in chip prices since early this year, company spokesman Pai Pei-lin (白培霖) said. The Taoyuan-based chipmaker lost NT$10.39 billion last quarter.

This month, the average selling price is expected to climb probably by a mid-single-digit from last month, Pai said. The price has risen at a monthly rate of 3 percent last month and 4 percent in April.

“The third quarter will be a better quarter than the second quarter, helped by seasonally high demand, but the strength will be milder than in past years,” Pai said by telephone after the company shareholders’ meeting.

“Uncertainty about the global economy is affecting people’s consumption,” he added.

In past years, shipments usually grew 50 percent in the second half from the first half, but this year, the growth could be between 20 percent and 30 percent, Pai said.

Pai said unstable economic circumstances in the US and China have weakened demand and caused an increase in inventories, while demand for notebook computers and DRAM chips would remain lukewarm ahead of the likely launch of Microsoft’s Windows 8 operating system in the fourth quarter, as consumers tend to take a wait-and-see attitude toward a new operating system, he said.

To limit the impact of the volatile DRAM chip industry on its bottom line, Nanya Technology aims to expand its non-DRAM products to account for 60 percent of its total revenue in the final quarter of this year, compared with 44 percent at the end of last year, Pai said.

Except PC DRAM chips, Nanya Technology also makes chips used in servers, mobile devices and consumer electronics, such as LCD TVs.

The company supplies server chips to US PC companies Hewlett-Packard Co and Dell Inc.

Shareholders yesterday approved the company’s proposal to issue 3.8 billion new common shares via a private placement to raise funds and improve its financial structure.

The chipmaker’s net value reduced to NT$0.84 per share at the end of the last quarter on persistent losses. Nanya Technology shares yesterday edged lower 0.77 percent to NT$2.57.

Nan Ya Plastics Corp (南亞塑膠) would subscribe to the share sale, Pai said, adding that the company was also in talks with other potential investors.

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