Everlight Electronics Co (億光電子), the nation’s top LED chip packager, on Wednesday reported better earnings for last quarter on improved operating expenses, higher non-operating income and a record quarterly revenue.
Net profit rose 21.24 percent quarter-on-quarter and jumped 182.79 percent year-on-year to NT$486.07 million (US$16.42 million), the Shulin (樹林), New Taipei City (新北市)-based company said in a filing to the Taiwan Stock Exchange.
That translates into earnings per share (EPS) of NT$1.18 for the July-to-September quarter, compared with NT$0.92 in the previous quarter and NT$0.41 last year.
However, the company’s declining gross margin last quarter and seasonal weak demand this quarter could pose risks going forward, analysts said.
Everlight posted consolidated revenue of NT$6.99 billion last quarter, up 17.74 percent quarter-on-quarter and 41.57 percent year-on-year. However, its gross margin fell 1.63 percentage points to 24.74 percent from the second quarter, which was a blow to market expectations. On a yearly basis, gross margin increased by 1.68 percentage points.
“We think this could imply the pricing competition for the lighting business could be strong and the gross margin from its WOFI subsidiary may be slightly lower than our expectations,” UBS Securities analyst Samson Hung (洪希民) said in a client note.
Everlight announced in July that it was acquiring a 100 percent stake in the German lighting firm WOFI Leuchten GmbH from Hannover Finanz GmbH and its subsidiary for 6.55 million euros (US$8.8 million).
Hung said that given the seasonal slowdown in the backlight unit this quarter, together with the lukewarm demand for consumer electronics and general lighting products, Everlight’s fourth-quarter revenue is likely to drop by between 5 percent and 10 percent from last quarter, with WOFI sales accounting for about 10 percent of Everlight’s total revenue this quarter.
“Given falling revenue, we see scope for the gross margin to trend down quarter-on-quarter,” he said.
In the first three quarters of the year, Everlight’s net profit totaled NT$1.11 billion, up 197 percent year-on-year. EPS were NT$2.63 for that period, compared with NT$0.92 in the previous year.
Shares of Everlight rose 1.55 percent in Taipei trading yesterday to NT$52.5. They have risen 37.8 percent so far this year.