Semiconductor component distributor WT Microelectronics Co (文曄科技) on Monday forecast that revenue would grow by 7 to 13 percent sequentially to a historic high this quarter.
Consolidated revenue for the current quarter is predicted to climb to between NT$27.5 billion and NT$29.1 billion (US$915 million and US$969 million), from NT$25.71 billion last quarter, according to a conference call presentation document released by the company.
WT Microelectronics said that gross margin would likely range between 5.7 and 5.9 percent, compared with 5.92 percent last quarter, while operating margin would likely be between 2.4 and 2.6 percent, compared with 2.41 percent in the previous quarter.
Analysts said the company’s positive guidance indicates that its profit margins would continue trending up amid solid demand for automotive, industrial and instrument products over the long term.
Yuanta Securities Co (元大證券) forecast that the company would report earnings per share (EPS) of NT$1.4 this quarter and NT$4.8 for the whole year.
PROFIT SURGE
“We reiterate that 2014 will be the second year in a row that we see WT Micro’s operating profit and EPS growing faster than its top line,” Yuanta said of the company’s effort to maintain higher revenue growth through better expense control.
In the second quarter, the company reported a net income increase of 41.81 percent year-on-year and 35.13 percent quarter-on-quarter to NT$457.82 million, or EPS of NT$1.29.
Revenue expanded 22.33 percent year-on-year and 11.75 percent quarter-on-quarter to NTS$25.71 billion last quarter, thanks to a more stable global PC market, steady demand for communication products in China and increasing contribution from its industrial and instrument components-linked business, the company said.
Last week, WT Microelectronics’ bigger competitor WPG Holdings Co (大聯大) also reported healthy results for last quarter, with sales totaling NT$113.7 billion in the quarter, up 11.1 percent quarter-on-quarter and 13 percent year-on-year. It was a record-high figure for the quarter and was ahead of the company’s guidance of NT$105 billion to NT$110 billion.
Net income for last quarter was NT$1.51 billion, or EPS of NT$0.91, which also represented a record high for the company.
For this quarter, WPG Holdings forecast that consolidated sales would rise by between 3.7 and 8.1 percent to between NT$118 billion and NT$123 billion, according to a stock exchange filing released on Wednesday last week.
The company also forecast that gross margin would range between 4.4 percent and 4.7 percent, while operating margin would be between 1.75 and 1.95 percent.
EXPANSION
As WPG Holdings is aggressively expanding into LED lighting, Internet of Things, surveillance, wireless chargers and power supply for small home appliances, Deutsche Bank forecast on Monday that the company’s revenue would increase to NT$452.63 billion this year and NT$494.48 billion next year, from NT$406.26 billion last year.
Earnings per share are forecast to rise to NT$3.29 this year and NT$3.65 next year, from NT$2.87 last year, Deutsche Bank said.
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