Thu, Apr 24, 2014 - Page 14 News List

Soft-World will grow by 46%: Jih Sun

By Kevin Chen  /  Staff reporter

Soft-World International Corp (智冠科技), the nation’s top game developer by sales, is forecast to achieve sales growth of 46 percent annually this year as the company rides the mobile-game trend, Jih Sun Securities Investment Consulting Co (日盛投顧) said yesterday.

The company, which specializes in developing online games, could also see its net profit jump by 70 percent this year from last year, as mobile games have higher margins than online games and thanks to better performances at its subsidiaries, Jih Sun Securities analyst Alan Chen (陳炤綸) said in a client note.

The company’s subsidiaries include online game publisher Gameflier International Corp (遊戲新幹線), online game developer Chinese Gamer International Corp (中華網龍) and online game distributor Game First International Corp (智凡迪).

“Soft-World is a leading online game company, with its business scope ranging from upstream game developer to midstream service provider and downstream distribution,” Chen said.

In addition, Soft-World has seen rising revenue from its prepaid game-point card business, as the company sells a card called “MyCard” at both brick-and-mortar and online stores, he added.

In the first quarter of the year, the company saw its revenue jump 63.84 percent year-on-year to NT$4.497 billion, company data showed.

Jih Sun Securities estimated that Soft-World’s revenue this year would total NT$16.11 billion, from NT$11.02 billion last year, while net profit could reach NT$650 million, or earnings per share of NT$5.1, this year from NT$382 million or NT$3.0 per share last year, the brokerage forecast.

Soft-World shares closed 2.59 percent lower at NT$113 yesterday on the GRETAI Securities Market. The stock has surged 56.73 percent since the beginning of the year, while the over-the-counter GRETAI index has increased 12.58 percent over the same period.

Jih Sun Securities has set a share price target of NT$127 for the stock.

On April 2, Soft-World International chief financial officer Chung Hsing-po (鍾興博) told investors that smartphone games would be the company’s priority this year as the company is planning to roll out 20 new smartphone games.

“Soft-World is aiming to launch more mobile games thanks to the high penetration of smartphones, especially for Android users,” HSBC Securities Taiwan analyst Abel Lee (李忠翰) said.

The company is likely to expand other sales channels, like supermarkets, and will encourage consumers to buy prepaid game-point cards via credit card or ATMs to boost its revenue, Lee said.

However, the company will not see its new third-party payment subsidiary make any meaningful contribution until related regulations are approved, he added.

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