Pegavision Corp (晶碩), which is expected to debut its shares on the main bourse next month, reported that earnings dropped more than 9 percent annually in the first half of the year, because of some customers’ inventory adjustments and delayed product launches, company president Yang Te-sheng (楊德勝) said on Thursday.
After customers’ new products hit the market later this year, the company would resume growth in the fourth quarter and gross margin would likely to return to normal, Yang told a pre-listing conference in Taipei, the Chinese-language Liberty Times (the Taipei Times’ sister newspaper) reported on Friday.
Founded in 2009, Pegavision is a maker of disposable contact lenses based in Taoyuan, with about 70 percent of sales generated in overseas markets.
Photo: Chen Yung-chi, Taipei Times
Japan has become the company’s largest revenue contributor and accounted for about 61 percent of sales last year, with the rest coming from Taiwan (23 percent), China (8 percent) and other areas (about 7 percent), company data showed.
Pegavision offers its own brand of products and also supplies to foreign brands as an original design manufacturer (ODM), with Japan’s second-largest colored contact lens maker, T-Garden Co, among its major clients, the Liberty Times reported.
In the first six months, the company reported net income of NT$190.33 million (US$6.09 million), or earnings per share of NT$3.17, down 9.43 percent from a year earlier, while revenue grew by a lackluster 5.98 percent to NT$1.5 billion over the period.
“The company’s weaker-than-expected sales momentum is attributed to clients’ destocking measures, as well as the delayed launch of new products. However, the effect should be short-lived, with sales momentum expected to pick up in the fourth quarter due to the launch of new contact lenses for people with presbyopia and new ODM orders from clients,” Yuanta Securities Investment Consulting Co (元大投顧) said in a note on Friday.
Pegavision has a monthly capacity of 30 million pieces and is planning to expand its capacity to meet rising demand by building a plant in Taoyuan’s Dasi District (大溪).
The company expects phase one of construction to be completed in 2021, which should boost its monthly capacity to 45 million pieces, the Liberty Times quoted Yang as saying.
Pegavision is applying for CE marking certification for the European market so that it can sell its new silicon hydrogel products as an ODM, Yang said.
The company hopes to start silicon hydrogel shipments in the first quarter of next year, he added.
Pegavision is 36.8 percent held by Kinsus Interconnect Technology Corp (景碩) and 18.1 percent by Pegatron Corp (和碩).
The company hopes to become a qualified supplier of the four major global contact lens brands — Johnson & Johnson, Alcon, Cooper Vision and Bausch & Lomb, the Liberty Times quoted Pegavision chairman Tung Tzu-hsien (童子賢) as saying.
Pegavision has yet to set a price for its debut on the Taiwan Stock Exchange. The stock traded 4.55 percent higher at NT$207 on the smaller Emerging Stock Board on Friday.
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