Win Semiconductors Corp (穩懋半導體) yesterday announced a stock buyback scheme after last month’s revenue fell to its lowest level since January 2011. The stock has dropped 14.83 percent this year
In a filing to the Taiwan Stock Exchange, the foundry services provider for gallium arsenide (GaAs) components used in handsets said its board had agreed to buy back up to 20 million shares, or 2.64 percent of total outstanding shares, at a price of NT$26 to NT$40 per share.
The company is expected to spend NT$7.11 billion (US$240 million) on the buyback plan and will then cancel the repurchased shares in a bid to increase earnings per share for shareholders, the filing said.
The scheme, beginning today and running through Dec. 3, is not expected to financially burden the company based in Linkou (林口), New Taipei City (新北市), which had NT$24.56 billion in current assets, including NT$3.79 billion in cash and cash equivalents, at the end of June, its balance sheet showed.
Shares of Win Semiconductors closed 0.36 percent higher at NT$27.85 yesterday before the company unveiled its buyback plan and the latest sales data.
Last month, the firm’s consolidated revenue was NT$645 million, down 33.37 percent year-on-year and 28.47 percent month-on-month, according to another stock exchange filing. Cumulative revenue totaled NT$8.55 billion in the first nine months of the year, increasing just 1.56 percent annually, the filing showed.
Win Semiconductors counts Singapore’s Avago Technologies Ltd, China’s RDA Microelectronics Inc (銳迪科) and US-based Skyworks Solutions Inc — which produce GaAs-based electronic devices used by high-end smartphone vendors like Apple Inc and Samsung Electronics — as its major clients.
The company met its sales guidance and analyst forecasts for the just-closed quarter when it posted revenue of NT$2.52 billion, down 20.8 percent quarter-on-quarter.
On Aug. 13, the company told investors that it expected revenue for last quarter to decline 20 percent sequentially on the back of slowing high-end smartphone demand.
“We believe the company’s sales have hit the bottom last month and may rebound gradually,” Carlos Peng (彭國維), an analyst at Fubon Securities Investment Services Co (富邦投顧), said in a note to clients.
“Considering the potential inventory build of several flagship handsets by brandname companies in the second half of this year and the seasonal demand for the Christmas and Lunar New Year holiday seasons, we believe the company will see a mild recovery in the fourth quarter,” Peng said.
Fubon Securities forecast earnings per share (EPS) of NT$2.59 for this year, and increased its EPS forecast to NT$2.61 next year from a previous forecast of NT$2.4.