LED chipmaker Lextar Electronics Corp (隆達電子) yesterday reported that first-quarter net profit dropped 95.19 percent from a year ago to NT$21 million (US$695,200) due to a fall in average selling prices.
The past quarter’s figure was also down 36.36 percent from the NT$33 million it posted in the fourth quarter of last year.
Lextar said earnings per share were NT$0.05 during the first three months of the year, down from NT$0.09 a quarter ago and NT$0.92 a year earlier.
“Our first-quarter earnings were largely impacted by seasonal factors and declines in the average selling prices of some LED products,” Lextar public relations official Fiona Chiu (邱培玲) said by telephone.
The company manufactures layered crystalline wafers and chips used in LED products. A subsidiary of AU Optronics Corp (友達光電), Lextar also supplies LED backlight modules and provides packaging services to clients.
In the first quarter, sales of LED backlight products outgrew those of LED lighting products and accounted for up to 75 percent of Lextar’s total sales of NT$3.22 billion, the company said in a statement.
Gross margin improved to 12.5 percent last quarter because of a better product mix, compared with the 10.1 percent seen in the previous quarter and 6.8 percent a year earlier.
While utilization rates fell to 60 percent during January and February due to the Lunar New Year holiday and clients’ inventory adjustments, the rate rebounded to surpass 90 percent in March and remains high amid rising demand for LED lighting and backlight products, Chiu said.
“We plan to install new equipment from the end of this quarter to further expand our capacity in response to robust demand from clients for LED backlight and lighting products,” Lextar chief financial executive Chang Bo-yi (張博儀) said in the statement.
Lextar’s newly purchased equipment will be used to package LED chips and modules at its plants in the Hsinchu Science Park and China’s Suzhou Industrial Park, Chiu said.
The additional capacity is expected to boost Lextar’s capacity by about 30 percent to 1.3 billion chips a month from 1 billion units, Chiu said.
The additional capacity is expected to boost Lextar’s capacity by about 30 percent to 1.3 billion chips a month, from the current 1 billion units, Chiu said, adding that sales contribution from the new capacity will be reflected in the company’s sales next quarter at the earliest.
“Market demand for both LED lighting and backlight items is continuing growing at a steady pace in every market,” Chiu said.
“We forecast the demand would stay solid through the end of the year and help support our sales performance,” Chiu said. “At the same time, we will also keep diversifying the company’s product mix and client base to expand its business.”
Lextar said its priorities this year are to produce direct-lit backlight bars, substrate-free flip-chips, chip-on-board LED lighting components and backlight modules used in mobile devices such as smartphones and tablets.
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