Mon, Nov 17, 2014 - Page 13 News List

Ginko expects net profit to increase

EYEBALLING GROWTH:The contact lens manufacturer said it has begun a trial run for a Japanese firm and expects its lenses to be certified in Japan early next year

By Camaron Kao  /  Staff reporter

Ginko International Co (金可國際), which makes contact lenses and lens-care solutions, said net profit would rise 22 percent this quarter, helped by lower marketing expenses after moving many products online.

The company expects earnings to rise to NT$5.5 per share this quarter, compared with NT$4.5 per share last quarter.

Ginko plans to gradually bring a wide range of its Hydron and Horien brand products into online stores in China to reduce marketing expenses, while its brick-and-mortar shops there will focus on selling high-quality contact lenses shipped from Taiwan, Ginko vice president Sonny Pan (潘銘雄) said on Friday.

Ginko expects its earnings per share (EPS) for the whole of this year to grow 14.87 percent to NT$18 from NT$15.67 last year, Pan said.

The company earlier this month reported a 2 percent annual growth in net profit for last quarter to NT$416.61 million (US$13.54 million), from NT$408.4 million last year.

That was a 2.8 percent sequential growth from NT$405.15 million in the second quarter.

Gross margin improved to 62.17 percent last quarter from 59.53 percent in the previous quarter, but was lower than 63.58 percent for the same period one year ago.

Operating margin was little changed at 32.88 percent last quarter, from 32.86 percent in the second quarter, although it was down from 35.18 percent a year earlier.

The company expects revenue to be flat this quarter compared with last quarter’s NT$1.55 billion, Pan said on Friday.

“The third quarter is the industry’s peak season, as girls in China start to wear contact lenses when they graduate from junior-high schools or senior-high schools and enter a new phase of life,” Pan said. “The market sentiment usually continues through the fourth quarter.”

Ginko started a trial run manufacturing disposable contact lenses for a Japanese company last month, and is undergoing the certification process for its contact lenses in Japan, he said.

It expects to complete the certification process by the end of the first quarter next year, the company said.

Companies in Japan, Europe and the US are interested in Ginko’s highly automated production lines in Taiwan, and Ginko is also likely to start supplying its products to Europe by the end of next year, Pan said.

Ginko has six production lines in Taiwan with annual capacity of 88,300 lenses, and it plans to launch two more lines by the end of the first quarter.

The company uses those production lines to make high-quality contact lenses primarily for Chinese consumers.

It plans to begin selling the products to Southeast Asia next year.

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