Catcher Technology Inc (可成), a major metal casing supplier for Apple Inc’s iPhones, yesterday gave a rare downbeat revenue forecast for the first half of this year due to sagging customer demand.
Catcher’s prediction came amid growing concerns that iPhones are losing their appeal among consumers, prompting the US technology giant to trim orders from its component suppliers to avoid bloating inventories.
“The market has been rather volatile — particularly over the past few weeks... Based on [forecast] figures from our major customers, we expect [revenue] in the first half to stay flat year-on-year,” Catcher chairman Allen Hung (洪水樹) told an investors’ teleconference.
The firm’s competitors for Apple orders should also be feeling the pinch, Hung said, suggesting that the firm’s cautious estimate does not result from the loss of orders to rivals.
Over the past three years, Catcher’s revenues have more than doubled to NT$82.42 billion (US$2.46 billion) from NT$43.25 billion, Hung said.
Hung forecast Catcher would see revenues decline to about NT$17.4 billion this quarter, a 26 percent decline from the NT$23.48 billion generated in the final quarter of last year.
Shipments of iPhone 6S handsets in the first half of this year would be less than 81 million units — a 25 percent fall from the number sold in the same period last year, KGI Securities Co (凱基證券) analyst Kuo Ming-chi (郭明錤) forecast two weeks ago.
The iPhone 6S is unlikely to sell as well as other handsets in Apple’s “S” series, Kuo said, adding that Taiwanese component suppliers in Apple’s supply chain would see a corresponding weakness in their stock prices.
“The first quarter is likely to be a trough for component suppliers, and growth will gradually improve throughout the rest of the year,” Hung said.
Catcher is set to benefit from new product launches from its customers’ in the second half of this year and orders from new clients, he added.
Gross margin would hold steady at the company’s 10-year average of about 45 percent during the first half, he said.
Catcher’s first-quarter forecast was more pessimistic than those of some market watchers.
Capital Investment Management Co (群益投顧) expects Catcher to see a 16 percent contraction in revenue this quarter from the same period last year.
The investment consultancy has a “buy” rating on Catcher shares with a target price of NT$400.
To adjust to slowing demand, Catcher plans to substantially lower its capital spending this year, from the the NT$16.7 billion it spent in the first three quarters of last year and the NT$20.2 billion it spent in 2014.
Catcher did not release detailed figures about its fourth-quarter performance yesterday.
That would give Catcher ample room to “significantly” boost its cash dividend distribution to at least NT$10 per common share per year over the next five-year period, Hung said.
Last year, Catcher distributed a cash dividend of NT$6 per share, representing a 25 percent payout ratio from the company’s profits of NT$17.88 billion, or NT$23.52 per share.
Catcher shares fell 5.28 percent to NT$251 in Taipei trading yesterday, underperforming local rival Casetek Holdings Ltd (鎧勝), which saw its stock price drop 1.47 percent to NT$134.5. Casetek is contending with Catcher to win metal casing orders for Apple’s next-generation iPhone.
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