Vanguard International Semiconductor Corp (世界先進), which makes display driver integrated circuits (ICs) for flat panels, yesterday posted 53 percent annual growth in net income for last quarter, boosted by strong demand for ultra-high-definition 4K2K TVs.
Vanguard expects the growth to carry into this quarter.
“We are seeing good demand from clients in all segments,” company president Fang Leuh (方略) told investors yesterday.
“We have two months of order visibility through to the end of the second quarter,” Fang said. “We are seeing relatively brisk demand for power management ICs used in computers, tablets or industrial [devices].”
Shipments would grow about 1 to 3 percent sequentially this quarter from last quarter’s 428,000 8-inch wafers, Fang said.
Gross margin is expected to climb further to between 37 and 39 percent in the current quarter from 37 percent a quarter ago, while average selling prices will increase 1 to 3 percent quarterly, he said.
Last quarter, net income soared to NT$1.34 billion (US$44 million), or NT$0.83 per share, compared with NT$881 million, or NT$0.56 per share, in the same period last year, driven by resilient inventory buildup demand for driver ICs used in large panels, Vanguard said.
The second-quarter figure beat Credit Suisse analyst Randy Abrams’ estimate of NT$1.21 billion and the market’s expectation of NT$1.08 billion, the brokerage’s report said.
That represented a quarterly expansion of 19 percent from NT$1.13 billion, or NT$0.7 per share, in the final quarter of last year.
To fund the purchase of an 8-inch plant operated by DRAM chipmaker Sumpro Electronics Corp (勝普), Vanguard plans to increase capital spending to NT$3.8 billion this year from the NT$1.03 billion estimated two months ago.
Vanguard agreed to buy the plant for NT$2.18 billion to ease capacity constraints. The deal is to help the chipmaker grow its capacity 12 percent this year from last year.
To ease investors’ concern about the effects of unprofitable Sumpro on Vanguard’s profits, Fang said the company expected the acquisition to take away a total of 3 percentage points in gross margin in the second half. The chipmaker’s bottom line will not be affected, he said.
Vanguard aims to convert half of Sumpro’s memory chip capacity into better-margin logic chip capacity over three quarters, Fang said.
Vanguard shares rallied 3.29 percent to NT$43.9 yesterday, out-performing the TAIEX, which rose 0.71 percent.
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