After reporting annual and quarterly declines in net profits last quarter, Largan Precision Co (大立光) — a camera lens supplier for Apple Inc’s iPhones — yesterday predicted that demand this quarter would be slower than the first quarter of last year.
“Order visibility remains one month ahead, so we cannot see too far ahead. However, I expect the slow season this year to be worse than in past years,” chief executive officer Adam Lin (林恩平) told an investors’ conference.
This quarter, revenues look set to drop from last quarter’s NT$15.44 billion (US$457.59 million), with the size of the quarterly fall to be larger than the record decline posted in the first quarter of last year, Lin said.
Photo: Chen Mei-ying, Taipei Times
Largan’s sales plunged 37.44 percent quarterly to NT$10.56 billion last year in the quarter ending Mar. 31.
More than one client would adopt dual cameras for their products this year, Lin said, adding that the functions of such cameras can be used to increase exposure in taking photographs in dim environments and also for optical zooming.
“We are not certain how those clients plans to use dual-camera lenses. Largan is a component supplier, we only care about how to meet clients’ demand for lens specifications,” Lin said.
Remarking on an industry trend, Lin said that clients tend to continue upgrading their camera lens specifications.
Other than the camera lenses used in smartphones, Largan is to begin supplying camera lenses made out of glass for automobiles next year, Lin said.
The glass components would be polished in Largan’s plants in China, while the firm’s Taiwan facilities would assemble the components into camera lenses, Lin said.
The construction of Largan’s new plant would be completed in the first quarter of next year and become operational in the second quarter as scheduled, Lin said.
Last quarter, Largan’s net income dropped 9.55 percent annually and 18.04 percent quarterly to NT$6.72 billion, with earnings per share of NT$50.1, mainly because of soft demand for iPhone models.
Gross margin was 59.9 percent last quarter, up 9.24 percentage points from 50.66 percent in the same period a year earlier and 4.81 percentage points from the previous quarter’s 55.09 percent.
The 59.9 percent gross margin was Largan’s highest margin performance in the firm’s history.
“The increase in gross margin was driven by the growing shipments of high-end lenses and a better yield rate,” Largan investor relations official Josephine Huang (黃印嘉) said.
Largan posted net profits of NT$24.15 billion last year, an increase of 24.29 percent from NT$19.43 billion recorded the previous year.
Largan’s earnings per share last year were NT$180.09, the highest figure in the Taiwan Stock Exchange’s history.
Largan shares fell 5.6 percent to close at NT$1,855 in Taipei trading yesterday, underperforming the TAIEX, which declined 1.04 percent.
‘BIG LOSS’: This year might see the last generation of Huawei’s Kirin chips, as their production would stop next month because they are made using US technology Chinese tech giant Huawei Technologies Co (華為) is running out of processor chips to make smartphones due to US sanctions and would be forced to stop production of its own most advanced chips, a company executive has said, in a sign of growing damage to Huawei’s business from US pressure. Huawei, one of the biggest producers of smartphones and network equipment, is at the center of US-Chinese tension over technology and security. Washington last year cut off Huawei’s access to US components and technology, and those penalties were tightened in May, when the White House barred vendors worldwide from using US
’WHITE BOX’: The open platform would give local firms access to Cisco’s cloud-based mobile network to develop 5G telecom equipment and tap into the global market The Ministry of Economic Affairs (MOEA) yesterday introduced a new 5G “open lab” in collaboration with US-based information technology and networking giant Cisco Systems Inc to address the rapidly growing “white box” 5G networking equipment market. The open lab will be a platform where Taiwanese manufacturers can access Cisco’s cloud-based mobile network to develop their own 5G telecom equipment, such as small-cell base stations, network switches, modems and Internet of things (IoT) devices, a ministry statement said. The open platform would allow Taiwanese manufacturers to tap into the lucrative 5G telecom equipment market, which was previously monopolized by Nokia Oyj, Ericsson AB
CORPORATE SCANDAL: Cathay Life has invested NT$13.3 billion in Bank Mayapada since 2015, but the latest loss of NT$8.8 billion has completely written off its investment Cathay Life Insurance Co (國泰人壽) yesterday said it would recognize an investment loss of NT$8.8 billion (US$298.1 million) in Indonesia’s Bank Mayapada Internasional Tbk PT due to concerns about the lender’s operations amid a corporate scandal. The company said it would revise its earnings result for June, from a net profit of NT$6.52 billion to a net loss of NT$520 million, its first monthly loss over the past 17 months. After booking an investment loss of NT$5.2 billion in Bank Mayapada earlier this year, Cathay Life has so far recognized total investment losses of NT$14 billion in the lender, executive vice president
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported that revenue last month expanded 25 percent annually, but fell 12.8 percent month-on-month to NT$105.96 billion (US$3.59 billion). In the first seven months of this year, the chipmaker’s revenue surged 33.6 percent to NT$727.26 billion, compared with NT$544.46 billion a year earlier. TSMC has said it aims to grow its revenue by more than 20 percent this year. The company has since May 15 stopped taking new orders from Huawei Technologies Co (華為), its second-biggest customer after Apple Inc, due to the US’ restrictions on exports containing US technologies. TSMC has no plans to