Thu, Mar 21, 2013 - Page 13 News List

Chi Mei expects a slight decline in Q1 revenues

DOWN, BUT NOT OUT:Despite reduced demand affecting revenues, the firm is cautiously upbeat for this year, partly because of the demand for mobile devices

By Lisa Wang  /  Staff reporter

Chi Mei Material Technology Corp (奇美材料), which supplies LCD key component polarizers to panel maker Innolux Corp (群創光電), expects revenues to slide slightly this quarter from last quarter because of reduced demand for monitors and delayed shipment of new products for TV panels, a company executive said yesterday.

Polarizers used in monitors accounted for 60 percent of Chi Mei’s overall shipments last year.

“We lost some orders because we could not receive product certification for [polarizers for] 55-inch TV panels for shipment in time,” company chairman Ho Jau-yang (何昭陽) said at an investors’ conference.

Chi Mei expects “revenue will drop slightly this quarter, from [NT$5.07 billion (US$170 million) in the] last quarter,” Ho said.

Ho said he was cautiously optimistic about the company’s operations this year, forecasting revenues would grow slightly from last year’s NT$20.17 billion.

In addition, “orders will gradually recover in the second quarter, which will help revenue bounce back to a level similar to that of the third quarter [of last year],” he said.

Chi Mei Material reported NT$5.13 billion in revenue during the third quarter of last year.

The company shipped 90 percent of its polarizers to Innolux, which holds a 16.73 percent stake in Chi Mei Material. Chi Mei Corp (奇美實業) owns 50.44 percent.

Ho is pinning his hopes on new polarizers used in panels for TVs and mobile devices such as tablets for growth in the second half of the year.

The company expects to see new orders for polarizers used in 55-inch TVs beginning in the third quarter, after receiving product certifications, he said.

Polarizers for small and medium-sized panels accounted for a small portion of the company’s total shipments, but Ho said such shipments would grow 50 percent this year to account for 15 percent of the total.

“That will help boost the company’s profit and revenue,” he said.

Polarizers used in mobile devices enjoyed the highest gross margin among Chi Mei’s products, he said.

This year, polarizers for panels for TVs and mobile devices are expected to account for 40 percent and 15 percent of the company’s shipments respectively, compared with 30 percent and 10 percent last year, Ho said.

Chi Mei’s net profits grew about 12 percent last year to NT$1.6 billion, or NT$3.5 per share, from NT$1.43 billion, or NT$3.37, in 2011. Gross margin improved to 11.27 percent from 11 percent.

This year, Chi Mei plans to spend about NT$600 million in upgrading equipment to boost capacity by 10 percent annually.

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