Pneumatic components supplier Airtac International Group (亞德客) yesterday reported that net income for last quarter declined 6.17 percent year-on-year to NT$772.72 million (US$24.86 million), with earnings per share dropping from NT$4.36 to NT$4.09.
That brought the company’s net income for the first half of this year down 14.3 percent annually to NT$1.46 billion, or earnings per share of NT$7.72, Airtac said in a filing with the Taiwan Stock Exchange.
Gross margin declined 3.22 percentage points to 46.72 percent, while revenue decreased 4.77 percent to NT$7.78 billion, the company said.
“The pneumatic components market in China declined 10 percent year-on-year in the first half of the year,” Airtac spokesman Ivan Tsao (曹永祥) told a conference call.
“Demand has been sluggish so far this year, as the US-China trade dispute stymied clients’ plans to place more orders and raise output,” Tsao said in Taipei.
For example, orders from clients in the battery industry declined significantly in the first half, he said.
The situation has not improved, even after the US and China last month reached a truce at the G20 summit in Osaka, Japan, he added.
Airtac, which counts China as its largest market with about 90 percent of its total sales, said that it would retain its 10 percent revenue growth forecast for this year, which it made in the first quarter, in anticipation that major customers would increase their orders.
However, it added that it would release a new outlook in September, when order visibility becomes clearer.
“We plan to introduce standard linear guideways later this year with the expectation that demand in the second half would be better than that of the first half, while demand for next year would likely outpace this year,” Tsao said, adding that the linear guideway market in China remained promising.
Analysts have said that the company’s business hit bottom in the first quarter.
As new linear guideways have been introduced and orders for pneumatic products might improve later this year, Airtac’s revenue is expected to increase quarterly in the second half, they said.
As the company does not plan to adjust the average selling prices of its products, gross margin is expected to remain at 25 percent for the year, they added.
Airtac shares yesterday closed down 1.59 percent at NT$341.5 in Taipei trading. They have increased 13.83 percent this year.
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