Largan Precision Co (大立光), a camera lens supplier for Apple Inc, yesterday reported the highest quarterly net income in the firm’s history for last quarter, of NT$8.2 billion (US$252.64 million), mainly from foreign exchange gains.
The net profit jumped 55.3 percent from last year’s NT$5.28 billion and surged by 70.12 percent from NT$4.82 billion recorded in the quarter prior.
Earnings per share were NT$61.17, which brought the firm’s total earnings per share in the first three quarters of this year to NT$129.99, up 46.84 percent compared with NT$88.52 per share over the same period last year.
Photo: Chen Mei-ying, Taipei Times
“The company booked more than NT$1.7 billion in foreign currency gains last quarter,” Largan investor relations officer Josephine Huang (黃印嘉) told a teleconference.
In the first three quarters, the camera lens supplier’s combined revenue totaled NT$40.42 billion, increasing 39.81 percent from a year earlier, the company said.
“We expect this month’s sales will grow from last month’s NT$5.51 billion due to increased orders from clients,” Largan chief executive officer Adam Lin (林恩平) said.
Next month’s sales are expected to be flattish from this month and the order visibility for December remains unclear for the time being, Lin said.
However, the continual migration of smartphone cameras to higher pixel counts is to increase Largan’s average selling prices and revenue, he added.
CIMB Securities Ltd forecast Largan’s sales this quarter to climb to the peak for this year, with revenue likely growing 33.41 percent to NT$22.69 billion from last year’s NT$16.88 billion.
Commenting on rising competition from Chinese rivals, Lin said: “I do not see any changes in Largan’s order allocation from major clients.”
Analysts said Largan has potential competition from Chinese rivals, including Sunny Optical Technology Group Co (舜宇光學), Taiwan’s Genius Electronic Optical Co (玉晶光) and Japan-based Kantatsu Co.
HSBC Securities Taiwan Corp last week reduced its predictions for Largan’s order allocation for iPhones from 90 percent this year to 70 percent next year as competitors catch up.
Lin said it is common for most major brands to have dual suppliers for their products to stabilize production supply.
“Market share is not really an issue [for Largan]… You get as much as you can based on the level of capability,” he said.
However, pricing competition remains a constant pressure, Lin said, noting that prices for the company’s new products are usually higher and it is likely to cut prices for its older models to compete with rivals.
Lin said the company’s yield rate was affected by the specification of a US client’s new models, which consequently dragged down the firm’s gross margin for last quarter.
Gross margin was 55.1 percent, down 2.62 percentage points from the previous quarter’s 57.72 percent, but increased by 2.61 percentage points from last year’s 52.49 percent.
“It is always challenging to improve the yield rate when our clients have new models. Largan will keep improving it,” Lin said.
He did not say whether gross margin this quarter is likely to improve from last quarter.
Largan shares rose 1.37 percent to NT$2,585 in Taipei trading yesterday, outperforming the TAIEX, which gained 0.93 percent.
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