Largan Precision Co (大立光), a camera lens supplier for Apple Inc’s iPhone series, yesterday posted 26 percent annual growth in net profit for last quarter and said the momentum should escalate this quarter.
The results came as Largan is diversifying its customer base by adding customers from the Android camp to reduce downside risks from iPhones.
As one of the largest suppliers in the industry, with nine factories in Taiwan and two in China, Largan also counts Samsung Electronics Co, Huawei Technologies Co (華為), Oppo Mobile Telecommunications Corp (歐珀) and Vivo Communication Technology Co (維沃) among its major clients.
Largan said net profit rose to NT$5.05 billion (US$163.6 million) during the quarter ended March 31, compared with NT$4.02 billion in the same period last year. That translated into earnings per share (EPS) of NT$37.68 last quarter, up from NT$29.96 a year earlier.
Gross margin improved to 64.26 percent last quarter from 63.29 percent a year earlier.
On a quarterly basis, net profit tumbled 21 percent from NT$6.48 billion, or EPS of NT$48.29. Gross margin fell from 69.45 percent in the fourth quarter last year due to lower revenue.
“It looks to me that April will be better than March. May will not be slower than April,” Largan chief executive officer Adam Lin (林恩平) said in response to an investor’s question about its business outlook for the current quarter.
“Orders are picking up,” Lin said.
That is reflected in a 55 percent month-on-month jump in revenue last month to NT$3.14 billion, he said.
Lin declined to comment on whether the growth in revenue last month was due to increased demand from Huawei.
Huawei yesterday launched its latest flagship P30 series of smartphones in Taipei. The P30 pro is equipped with four cameras, which have time-of-flight (TOF), 3D-sensing lenses to support facial-recognition features and advanced periscope zoom lenses enabling five times optical zoom.
Largan chairman Scott Lin (林恩舟) was at the Huawei launch, as the Chinese smartphone maker is one of its major Android-camp customers.
Due to an increase in production of new lenses, no quick improvement in gross margin is expected, as it takes time to overcome learning curves, Scott Lin said.
In the first quarter, revenue contracted 12.44 percent to NT$9.82 billion from NT$12.44 billion in the final quarter last year, according to a company financial statement. That represented annual growth of 11 percent.
Last quarter, 20 to 30 percent of Largan’s shipments consisted of 20-megapixel lenses, up from 10 to 20 percent in the previous quarter. Ten-megapixel lenses contributed 50 to 60 percent, down from 60 to 70 percent in the fourth quarter last year. Eight-megapixel lenses made up 10 to 20 percent, unchanged from the previous quarter.
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