Richtek Technology Corp (立錡), the nation’s top analog integrated circuit designer, yesterday reported its pre-tax profits fell 9.6 percent to NT$367 million (US$12.11 million), hitting a two-year low, dragged by weak PC demand.
On an annual basis, pre-tax profits last quarter dropped 6.9 percent from NT$394 million a year ago.
“The current quarter is expected to be a prosperous period for Richtek Technology as the company has received big orders for sub-power management integrated circuits [sub-PMICs] used in smartphones,” vice president Chang Kuo-cheng (張國城) told investors during a teleconference.
Richtek Technology expects its revenue this quarter to expand to between NT$2.6 billion and NT$2.9 billion, up 4 percent to 16 percent from NT$2.49 billion last quarter.
Taishin Securities Investment Advisory Co (台新投信) analyst Edward Hu (胡明耀) said the target was based on orders in-hand.
Sub-PMICs are designed to assist standalone PMICs to manage mobile devices’ power consumption as more smartphone and tablet products are equipped with quad or octo-core chipsets for faster processing speeds, Chang said.
“Richtek Technology will supply sub-PMICs to more than one client,” Chang told investors when asked if Samsung Electronics Co is its only new-product client.
Richtek expected gross margin to be between 35 percent and 38 percent this quarter from 37.7 percent last quarter, while operating margin was forecast to fall to between 11 percent and 14 percent from 14.3 percent.
Hu estimated Richtek Technoloy would post earnings per share of NT$2.03 for last quarter, less than those of NT$2.32 during the July-to-September quarter and the NT$2.38 during the same period a year ago.
He said Richtek will benefit from growing demand for its sub-PMICs as mobile makers equip their products with power-hungry fourth-generation long-term evolution chips.
“It’s highly possible that in the initial stage, Richtek will be Samsung’s sole supplier of sub-PMICs from this quarter,” Hu said.
He gave Richtek Technology’s shares a “buy” rating, with a target price of NT$215.
Richtek Technology’s shares stayed the same at NT$170 in Taipei trading yesterday, while the benchmark TAIEX fell 0.51 percent.
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