Semiconductor components distributor WPG Holdings Co (大聯大投資控股) has projected that sales for this quarter would increase sequentially as a result of seasonal demand and product mix adjustments.
In an investors’ conference on Friday, the company said its consolidated sales this quarter would probably drop by between 11.78 and 18.93 percent to a range of NT$125 billion to NT$133 billion (US$4.04 million to US$4.3 million), from NT$111.83 billion last quarter.
The company said gross margin is likely to decline to between 4.2 and 4.4 percent this quarter, from 4.45 percent last quarter. Operating margin for the quarter may be between 1.75 percent and 1.95 percent, compared with 1.81 percent over the same period, according to the company’s presentation document released after the conference. Net profit would be between NT$1.1 billion and NT$1.42 billion, with earnings per share (EPS) ranging from NT$0.66 to NT$0.85, it said.
Analysts have said the company might focus on management of working capital and inventory this year, as the semiconductor sector is expected to post low single-digit percentage growth affected by lower end-market demand amid the US-China trade spat.
In the first quarter, net profit came in at NT$1.3 billion, with operating profit of NT$2.03 billion and EPS of NT$0.78.
The company said the quarterly results reached the high end of its guidance due to optimized product portfolios and efficient expense control.
However, the figures were lower than the previous quarter’s, when net profit reached NT$1.89 billion, operating profit was NT$5.75 billion and EPS came in at NT$0.95.
WPG attributed the quarterly declines to the seasonal weakness of the semiconductor industry and supply chain inventory adjustment.
Nevertheless, steady demand for information technology and automotive electronics, as well as continued deployment in new applications such as the Internet of Things, artificial intelligence, cloud-based storage and high-performance computing, would provide firm support for the company’s business, it said.
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