Electronics component maker Lite-On Technology Corp (光寶科技) yesterday said that net income for last quarter plunged 42.23 percent from a year earlier to NT$1.45 billion (US$46.18 million), or NT$0.63 per share, dragged down by a NT$1 billion inventory write-off at its camera lens module business.
The company booked a total of NT$2 billion in inventory losses last year from its smartphone camera lens business, mainly due to poor product yields, Lite-On Group chief executive Warren Chen (陳廣中) told an investors’ conference.
Profitability was also affected by the company’s mobile mechanics business transition, Chen said.
Gross margin fell to 10.9 percent last quarter from 13.3 percent the previous year, but should improve going forward, he said.
“Given that we have digested the inventory and yields have improved, we expect gross margins to recover quarter-on-quarter this year,” he said.
For this quarter, Chen said he expects sales to decline by a single-digit percentage from last quarter’s NT$60.11 billion due to a seasonal slowdown, but should rise sequentially by between 10 percent and 20 percent next quarter, thanks to increasing demand for Lite-On’s high-end camera lens module from Apple Inc’s competitors.
The company will start to ship its new camera lens equipped with an optical image stabilizer and dual cameras next quarter, which should drive revenues, Chen said.
For the full year, Lite-On expects revenue to grow by a single-digit percentage, backed by its cloud-computing products, LED lighting and applications, and high-end camera lens modules.
“Our goal this year is to raise overall profitability by improving our product mix and management rather than chasing huge growth in revenues,” he said.
The company is upbeat about the outlook for its optoelectronics division, which accounted for 26 percent of its total revenues last quarter, or NT$15.61 billion, on the back of strong demand for LED lighting and applications for automobiles and street lamps.
After recording annual growth of 30 percent last year, Lite-On expects optoelectronics revenue to increase 20 percent to NT$18.73 billion this year, he said.
Lite-On is also optimistic about its camera lens module segment, Chen said, adding that apart from smartphone lenses, the company has been developing camera lenses for automobiles, security surveillance and industrial robots over the past year.
“We would like to enhance the profitability of the camera lens module segment by boosting yields and shipping high-margin products,” he said.
The company’s board approved a proposal to distribute a cash dividends of NT$1.97 per share and a stock dividend of 0.5 percent per share based on last year’s total net profit of NT$6.46 billion, or NT$2.8 per share. That translates into a payout ratio of 70 percent.
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