Mon, Jan 13, 2014 - Page 14 News List

Synnex reaches record high monthly sales revenue for its IT components

RECOVERING DEMAND:The Taipei-based leading IT distributor set record revenue growth, attributing the hike to recovering commercial computer demand

By Kevin Chen  /  Staff reporter

Synnex Technology International Corp’s (聯強) consolidated revenue increased 1.61 percent month-on-month and 16.77 percent year-on-year to NT$32.04 billion (US$1.06 billion) last month.

The increase also marked the highest monthly revenue in the company’s history, Synnex reported last week.

That enabled the Taipei-based company — Asia’s leading distributor of information technology products and electronics components — to report NT$91.69 billion in revenue for the October-to-December quarter, up 6.7 percent quarter-on-quarter and 10.5 percent year-on-year, which also set a quarterly record for Synnex.

Jih Sun Securities Investment Consulting Co (日盛投顧) attributed the sales increase mainly to recovering demand in the commercial computer market in the Greater China region.

The technology company rounded out last year with total revenue of NT$329.89 billion, up 5.54 percent from NT$312.59 billion in 2012, the company said in a statement on Thursday.

However, the stock has underperformed the benchmark TAIEX by 25.57 percent over the past 12 months, as Synnex is still struggling to improve its product mix to enhance margins.

On Friday, Synnex’s shares closed 1.75 percent lower at NT$47.6.

Among its major products, the firm’s consumer electronics revenue increased 30 percent year-on-year to NT$55.8 billion between last January and last month, and IC components sales rose 32 percent to NT$73.8 billion over the same period.

That helped it to offset its 60 percent annual decline in telecom products revenue, which was NT$18.3 billion for the whole of last year.

Sales of information technology products, which account for 56 percent of Synnex’s total revenue and are the company’s main driver, increased 8 percent annually to NT$182 billion last year, internal data showed.

Synnex is expected to see its revenue edge up further this quarter on the back of increased distribution of smartphones from both Apple Inc and non-Apple clients, as well as the launch of Microsoft Corp’s Xbox One in China, Hong Kong and Taiwan, Jih Sun analyst Wayne Chen (陳有裕) said in a client note on Friday.

Chen said the company’s business scope expansion into mobile devices from personal computers and notebook computers would also drive up its IC components sales in coming months.

As Synnex has been authorized by China Unicom Ltd (中國聯通) to be a national handset distributor, HSBC Securities Taiwan Corp analyst Carrie Liu said the deal — which would see the company start distribution of Chinese smartphone brands such as Lenovo (聯想), K-Touch (天宇), Huawei (華為) and TCL this year — could help mitigate further decline in the company’s telecom revenue going forward.

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