Fri, Nov 16, 2012 - Page 13 News List

Primax expects mobile device demand to support sales

By Helen Ku  /  Staff reporter

Computer peripheral products maker Primax Electronics Ltd (致伸電子) yesterday said that sales would likely peak this quarter amid rising demand for mobile device components and digital home electronics products.

“Though our third-quarter sales performance was worse than expected, we believe device components will continue to drive sales growth this quarter and next year,” Primax chairman Raymond Liang (梁立省) said at an investors’ conference organized by the Taiwan Stock Exchange.

Third-quarter net profit was NT$261 million (US$8.98 million), down 27.6 percent from NT$360 million in the previous quarter and 46.1 percent less than NT$484 million in the same quarter last year, which the company attributed to higher operating costs and weaker demand for desktop computers and peripheral products.

Gross margin in the third quarter was 9.6 percent, operating margin was 7.2 percent and earnings per share were NT$0.65, the firm said.

Primax has begun shipping new mobile device components this quarter, forecasting that increasing demand for smartphones and tablet computers will support its sales momentum next year.

The company has also begun manufacturing digital home electronics this quarter and will start shipping new products in the first quarter of next year.

“Since demand for traditional office machines and computer peripherals has continued to decline over the past few years, we have begun selling more industrial printers and wireless electronics, such as wireless battery chargers and network-attached storage, to improve our product mix and increase gross margins,” Liang said.

“We estimate that sales of digital home appliances, such as TV remote controls, wireless keyboards, 3D glasses and game consoles will boost the firm’s overall sales by 5 to 10 percent next year,” he said.

Currently, computer peripherals account for about 47 percent of the firm’s overall sales, followed by handset components with 35 percent and office machines with 18 percent.

Primax said Nokia Oyj’s wireless smartphone battery charger pads are made by the company, but revenue contribution is still small as sales have just started.

In the first three quarters of the year, Primax posted a net profit of NT$929 billion on consolidated revenue of NT$31.45 billion and a gross margin of 10 percent, company data showed.

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