Silicon substrate maker Kinsus Interconnect Technology Corp (景碩科技) yesterday said its net income reached a five-year high last quarter, with analysts saying the company’s outlook remain promising.
In the July-to-September period, the company’s earnings rose 1.89 percent quarter-on-quarter to NT$848 million (US$28.8 million), according to a company filing to the Taiwan Stock Exchange.
Earnings per share were NT$1.9 last quarter, compared with NT$1.87 in the previous quarter, Kinsus said.
The company’s gross margin was 28.05 percent last quarter, up 1.9 percentage points from the previous quarter, after last quarter’s revenue increased 4.92 percent quarter-on-quarter to NT$6.15 billion, the second-highest level for the firm, Kinsus said.
Overall, the company reported earnings of NT$2.44 billion in the first three quarters this year, or NT$5.47 per share, with gross margin of 26.74 percent and cumulative revenue of NT$17.34 billion over the same period, company data showed.
Investors have become cautious about end-market demand in the technology sector in view of signs of a slowdown in broad-based demand for the second half this year, with Kinsus’ substrate products mainly used in communication devices seeing headwinds from slower growth in smartphones in recent months.
However, Yuanta Securities Corp (元大證券) said Kinsus would see long-term trend of earnings growth continue, driven by further proliferation of higher-end mobile devices and the fourth-generation telecom service base stations.
The company’s bottom line will also obtain support from narrowing losses from its printed circuit board business and because of Apple Inc’s application processor substrate orders, Yuanta analyst Andrew Chen (陳治宇) said in a note to clients yesterday.
Chen forecast revenue for this quarter is likely to decline 3.5 percent quarter-on-quarter to NT$5.94 billion and earnings could be 5.2 percent sequentially lower to NT$804 million.
Still, Yuanta retained its recommendation on Kinsus’ shares at “buy” rating but raised its target price to NT$127 from NT$125.
Shares of Kinsus rose 0.47 percent to NT$106 yesterday. The shares have increased 16.36 percent since the beginning of the year, outperforming the broader market’s 9.2 percent, the stock exchange’s data showed.