Epistar Corp (晶電) yesterday posted sales of NT$6.05 billion (US$186.44 million) for the first quarter of the year, up 2.36 percent from the previous quarter on increasing demand for backlight units used in TVs and growing orders for LED lighting products.
The quarterly sales were slightly better than the market’s consensus estimate of NT$5.98 billion.
Epistar, the nation’s No. 1 LED chipmaker, attributed the quarterly growth to smooth inventory digestion and rising orders for backlight units and LED lighting products, especially last month.
The company’s revenue last month jumped 35.77 percent to NT$3.23 billion from February, the company’s highest monthly revenue in the past 10 months.
However, first-quarter sales still represented an annual decline of 8.85 percent from the previous year’s NT$6.64 billion due to intensified pricing competition because of oversupply in the past year.
Morgan Stanley said it has turned more cautious on Epistar’s operations due to the continued excessive supply in the market and forecast that the company’s revenue would fall by 1.77 percent to NT$6.65 billion this quarter from last year.
“Epistar has started to consolidate its existing fabrication plants and progressively scale down its capacity, but these moves might not help it turn around meaningfully in a short period of time, as we expect tough competition to persist amid industry oversupply,” Morgan Stanley analyst Sharon Shih (施曉娟) said in a note released on Thursday.
Everlight Electronics Co (億光), the nation’s largest LED chip packager and lighting product supplier, also posted an annual decline in revenue in the first quarter.
Everlight’s revenue dropped 4 percent year-on-year and 7.3 percent quarter-on-quarter to NT$6.95 billion in the first quarter, the firm said in a filing with the Taiwan Stock Exchange.
Everlight attributed the decline in revenue to sluggish demand in the LED industry.
The company said demand for backlight units used in TVs and smartphones only resurfaced this month.
Mega International Investment Services Corp (兆豐投顧) said it expects improving demand for LED backlight units to help Everlight’s sales grow more than 7 percent quarter-on-quarter to NT$7.48 billion this quarter.
That would represent an annual increase of 6 percent from the second quarter of last year, it said.
Epistar shares fell 0.22 percent to close at NT$22.8 in Taipei trading yesterday, while Everlight shares rose 0.51 percent to close at NT$49.1.
Both shares underperformed the TAIEX, which gained 0.6 percent.
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