Lextar Corp (隆達), an LED manufacturing arm of AU Optronics Corp (友達光電), yesterday posted losses for the second consecutive quarter during the April-to-June period, dragged by falling prices for LED lighting products.
Net losses amounted to NT$120.38 million (US$3.83 million) last quarter, expanding from losses of NT$17.6 million three months earlier and reversing net income of NT$43.15 million a year earlier, according to the company’s filing with the Taiwan Stock Exchange.
Gross margin softened to 8 percent last quarter, down 2.7 percentage points from 10.7 percent a year earlier and 0.38 percentage points from the previous quarter’s 8.38 percent, company data showed.
Lextar’s operating margin fell to minus 2.76 percent last quarter, deteriorating from a minus-1.42 percent in the preceding quarter, suggesting a profit recovery is not yet in sight. The company reported 0.84 percent operating margin in the second quarter of last year.
Last quarter’s sales were flat at NT$3.63 billion from a year earlier, but grew 6.2 percent quarter-on-quarter amid the challenging LED industry, Lextar chief financial officer Chang Bo-yi (張博儀) said in a press statement.
However, due to pricing pressures from LED lighting products and the company’s investments in new businesses and research and development expenses, the company remained in the red last quarter, Chang said.
Lextar’s research and development expenses increased nearly 8 percent annually and quarterly to NT$149.72 million last quarter, according to the company’s filing.
The company’s net losses totaled NT$246.67 million in the first half of this year, compared with a net income of NT$99 million over the same time last year, the filing said.
Chang said the company has spotted recovering demand for LED backlight products, but Lextar is cautious about the business outlook for this quarter since selling prices for LED lighting products remained low due to excessive supply.
The company will be selective in taking orders with higher margin sin an attempt to increase Lextar’s profitability this quarter.
Also, the company will continue to develop high-tech products to raise its competitiveness, Chang said.
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