Profits for electronics parts maker Lite-On Technology Corp (光寶科技) grew 16 percent annually in the first quarter of the year, driven mainly by high-end modules for dual camera lenses used in smartphones, the company reported yesterday.
The company’s net income of NT$1.98 billion (US$65.52 million) marks its highest quarterly result over the period in the past 13 years, Lite-On data showed, while earnings per share were NT$0.85 last quarter, compared with NT$0.74 a year earlier.
“The high-end camera module segment was the main contributor last quarter. Its revenue expanded by 20 percent from the same time a year ago,” Lite-On chief executive officer Warren Chen (陳廣中) told an investors’ conference in Taipei.
Higher shipments of its LED components and LED outdoor lighting products also boosted its earnings in the January-to-March period, Lite-On said.
Consolidated sales were NT$51.4 billion in the first quarter, up 3 percent year-on-year, Lite-On reported earlier this month, when it attributed the increase to stable market growth from the cloud computing, LED lighting and high-end camera module businesses.
However, the company yesterday said its operating margin contracted by 0.09 percentage points annually to 4 percent last quarter, while its gross margin dropped 0.22 percentage points to 13 percent, citing the negative effect of rising raw material costs that eroded earnings of its information technology business.
In addition, a supply shortage of NAND flash memory chips also delayed shipments of its storage products and affected the overall margin performance, the company said.
Chen said the continued component shortage and increasing prices of raw materials would keep adding pressure on Lite-On’s margin performance this quarter.
“On the bright side, as more clients adopt dual-camera features for their flagship smartphones, we forecast the top and bottom lines to climb further,” Chen said.
Lite-On’s camera clients are mainly Chinese smartphone vendors, such as Huawei Technologies Co (華為) and Oppo Mobile Telecommunications Co (歐珀移動), which both launched high-end smartphones with dual cameras this quarter.
In light of the growing demand for camera modules, the company plans to expand its production capacity in the second half of this year, Chen said, declining to disclose the range of the expansion as the investment amount is not yet finalized.
The expanded capacity would be used for smartphones and new applications, such as camera modules for 3D-sensing and 360-degree cameras, Chen said, adding that they could be used in wearable products, drones or for surveillance.
Lite-On shares have risen 8.23 percent since the beginning of the year, compared with the broader market’s 6.68 percent increase. The stock closed at NT$52.6 yesterday in Taipei trading.
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