Sat, Apr 27, 2013 - Page 13 News List

Coretronic sees growth on TV, tablet demand

By Crystal Hsu  /  Staff reporter

Coretronic Corp (中強光電), which makes backlight modules for flat panels, yesterday forecast that shipments would increase 20 percent sequentially this quarter as inventory correction eases.

The company’s projection suggests an average monthly shipment of between 75,000 and 80,000 units this year, with demand from tablet and TV makers poised to rise sharply, despite flattish or weak demand from notebook and monitor makers, Coretronic president Sarah Lin (林惠姿) told an investors’ conference.

The Hsinchu-based company also reported that first-quarter net profit reached NT$353 million (US$11.88 million), up 38 percent from the preceding quarter and 81 percent from a year earlier. That translated into earnings of NT$0.49 per share.

Consolidated earnings in the first quarter increased 38 percent quarter-on-quarter and 81 percent year-on-year to NT$385 billion on revenue of NT$15.75 billion, company data showed.

Gross margin improved from 13.7 percent to 14.4 percent during the January-to-March period, thanks to lower operating expenses of NT$1.82 billion, Coretronic chief financial officer Ann Wu (吳秀蕙) said.

However, operating expenses are forecast to rise modestly this quarter to between NT$1.9 billion and NT$2 billion due to the launch of new products, Wu said.

Coretronic expects shipments of backlight modules used in televisions to jump more than 50 percent in the current quarter as larger-screen models become more popular, Lin said.

“We see rapid growth in demand for larger TVs with higher resolution,” Lin said, adding that demand for backlight modules for ultra-high-definition 4K2K TVs could grow by more than 250 percent sequentially this quarter, with most orders coming from branded customers in Japan and South Korea.

Televisions with 42-inch or 46-inch displays are increasingly replacing 32-inch models as the mainstream products after suppliers cut prices and refined technologies, a strategy that has won over consumers, Chen said.

As for tablets, Coretronic is looking at a triple business growth this year after shipments surged 55 percent in the first quarter, Chen said, but added that shipments might fall more 30 percent this quarter ahead of the launch of new models next quarter.

“Demand in the first quarter was not high, and 7-inch tablets may see sharp competition from 6-inch smartphones this quarter,” Chen said, adding that “consumers keep pushing for lower costs.”

Coretronic expects flat monitor shipments this quarter in the absence of major catalysts, she said.

Demand for laptops is likely to stall this year after a 27 percent drop last quarter, but may recover by 15 to 20 percent this quarter, Chen said.

The company announced earlier this week that it would distribute cash dividends of NT$1 per share, implying a dividend yield of 4.4 percent based on its closing price of NT$22.75 on the GRETAI Securities Market.

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