Flexium Interconnect Inc (台郡), a major supplier of flexible printed circuit boards (FPCBs), yesterday reported a 108.7 percent sequential increase in second-quarter net income to NT$240 million (US$7.72 million).
That translated to earnings per share of NT$1.13.
“Our gross margin last quarter improved to 16.3 percent from 11.4 percent [in the first quarter],” chief financial officer Arthur Hsiung (熊雅士) told investors in a conference call in Taipei.
Hsiung attributed the improvement to increased sales of FPCBs used in mobile phones, with the sales ratio rising to 50 percent last quarter from 30 percent in the first quarter.
“We expect the ratio to further increase this quarter,” he added.
The Kaohsiung-based company reported revenue of NT$4.66 billion for last quarter, up 7.2 percent from the first quarter, but down 6 percent from a year earlier.
“[Our clients] witnessed a decrease in mobile phone sales last quarter,” Hsiung said, but added that computer sales increased.
The computer segment contributed 32 percent to Flexium’s overall revenue last quarter, up from 27 percent in the first quarter and 17 percent a year earlier.
Contribution from the communication segment declined to 56 percent from 60 percent in the first quarter, while that from the consumer segment decreased to 12 percent from 13 percent.
Hsiung said he remains optimistic about Flexium’s performance this quarter and expects “a single-digit percentage growth” in shipments.
The company is also gearing up for mass production next year of 5G-related antenna modules based on liquid crystal polymer and modified polyimide materials at its Kaohsiung plant and Kunshan factory in China.
The 5G products are expected to make a higher contribution to revenue starting in the second half of next year, he said.
“We will focus on increasing our share of the high-end antenna market,” Hsiung said.
Operating expenses increased 18.1 percent on a quarterly basis to NT$542 million, as the company prepared for the peak season by adding two production lines for antenna modules, which have a higher gross margin, and audio modules among others, Hsiung said.
The company has also increased investments in research and development, he said, adding that it is working on a project with clients that aims to replace integrated circuit substrate with FPCBs through 10 micrometer and 15 micrometer process technology.
“We are looking for the opportune moment to apply our technology,” he said. It would be one of the main factors that would largely improve the company’s gross margin, he added.
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