Wed, Aug 10, 2016 - Page 12 News List

Inventec income rises on strong demand

By Lauly Li  /  Staff reporter

Contract electronics maker Inventec Corp (英業達) yesterday reported robust growth in net income for last quarter from the same period last year, driven by stronger-than-expected demand for servers and commercial PCs.

Net profit totaled NT$1.41 billion (US$44.83 million) last quarter, up by 20.51 percent from NT$1.17 billion in the same period last year and 14.63 percent from the previous quarter, company data showed.

The results translated into earnings per share of NT$0.4 last quarter, slightly less than the market estimate of NT$0.43 due to foreign currency exchange losses.

Earnings were better if foreign currency exchange losses are excluded, Inventec chief financial officer Yu Chin-pao (游進寶) said.

“Due to a stronger yuan against the US dollar, Inventec booked a foreign currency exchange loss of NT$646 million last quarter,” Yu told an investors’ conference at the company’s headquarters in Taipei.

Foreign currency exchange losses deepened last quarter, compared with a year earlier or the preceding quarter, he said.

In the first half of this year, foreign currency exchange losses totaled NT$958 million, nearly double the NT$572 million in losses in the same period last year, Yu said.

Yuan fluctuations have becoming increasingly important to Inventec’s earnings as the company expands operations in China, Yu said, adding that the company would take more aggressive measures to rein in its exposure there.

Looking ahead, Yu said the company foresees sales will increase by a single-digit percentage this quarter from last quarter’s NT$108.33 billion, aided by continued demand for servers and handheld devices.

However, the recent appreciation of the New Taiwan dollar has added uncertainty to profitability this quarter, Yu said.

Excluding currency exchanges, Inventec’s server business this quarter might jump by 10 percent from a year earlier and by a single-digit percentage from last quarter, Inventec president Huang Kuo-chun (黃國鈞) said.

Inventec’s server segment benefited from clients in the US and China, Huang added.

Revenue from the handheld business, which includes the company’s smartphone assembly business for China’s Xiaomi Corp (小米), is to grow by a double-digit percentage this quarter from the previous quarter on the back of seasonal factors, the company said.

The notebook PC business might be flat this quarter, compared with last quarter, Huang said.

Inventec’s solar power business is to be the dark spot this quarter, as sales from the segment might drop 20 percent due to slowing demand in the Chinese market, said Harry Hsieh (謝瑞海), CEO of Inventec’s solar power subsidiary, Inventec Solar Energy Corp (英穩達).

Falling average selling prices and fewer shipments of solar power products are putting pressure on Inventec’s solar business this quarter, Hsieh said.

Inventec reported sales of NT$34.82 billion for last month, up by 8.09 percent year-on-year, but a 13.4 percent drop from the previous month.

The company’s combined revenue totaled NT$203.69 billion in the first seven months of this year, a 13.17 percent increase from the same period last year.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top