Thu, May 01, 2014 - Page 14 News List

Strong demand boosts SPIL profit

UPGRADED SALES:A company statement showed the chip packager generated 63 percent of its total sales last quarter from communication-related business

By Crystal Hsu  /  Staff reporter

Siliconware Precision Industries Co (SPIL, 矽品精密), the world’s second-largest chip tester and packager, is eyeing a double-digit percentage increase in revenue and profit this quarter, aided by strong demand for upgraded mobile and computing devices, SPIL chairman Bough Lin (林文伯) said yesterday.

Lin gave the guidance during a teleconference to disclose the firm’s first-quarter earnings results.

The Greater Taichung-based company posted NT$2.09 billion (US$69.11 million) in net income last quarter, representing a 7.5 percent decline from three months earlier, but reversing net losses of NT$292 million a year earlier, its financial statement showed.

The results translated into earnings per share (EPS) of NT$0.67, down from NT$0.72 in the preceding quarter, while gross margin slipped to 22.1 percent from 22.9 percent, according to the statement.

“Major firms in the semiconductor industry have recently raised their earnings forecasts and are increasingly optimistic about their business outlook, as the economy in developed markets continues to improve,” Lin told investors.

The company’s revenue for this quarter is likely to rise to between NT$20.1 billion and NT$20.8 billion at a forecast exchange rate of NT$30.2 against the US dollar, while gross profit is forecast to hover between NT$4.82 billion and NT$5.2 billion, Lin said.

The sales guidance suggests a 15 percent pickup from last quarter, with EPS likely to rise by 43 percent to NT$0.96, the statement said.

The semiconductor industry is set to grow faster this year, after a 5 percent expansion last year, boding well for chip testing and packaging service providers, Lin said.

Lin attributed the rosy forecast to expectations of robust sales of mobile and tablet devices that may advance by a double-digit percentage although they are unlikely to beat last year’s pace.

Among its sales sources, communication-related business generated 63 percent of the company’s total sales last quarter, while the consumer electronics and computing segments contributed 19 percent and 14 percent respectively, the statement said.

SPIL may also profit from replacement demand for new PCs spurred by Microsoft Corp’s decision to stop supporting its XP operating system last month, Lin said.

For this quarter, the company expects its packaging utilization rate to climb to between 94 percent and 98 percent, from 86 percent in the previous quarter, while the testing utilization rate may expand to between 90 percent and 94 percent, from 86 percent.

Despite limited order visibility, the company is likely to fare better in the second half of the year than the first half, Lin predicted, as global technology companies will roll out new-generation gadgets.

In addition, the construction of telecommunication infrastructure in China is likely to help boost smartphone sales there, he said.

SPIL shares closed up 1.37 percent at NT$44.25 yesterday, bucking the TAIEX’s 0.91 percent fall, Taiwan Stock Exchange data showed.

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