Novatek Microelectronics Corp (聯詠), the world’s leading supplier of driver ICs for LCD panels, yesterday reported a record-high net profit of NT$2.21 billion (US$73.9 million) for last quarter, rising 12.38 percent from a year earlier and 22.7 percent from the previous quarter.
That translated into earnings per share of NT$3.63, up from NT$3.23 a year earlier and NT$2.96 the previous quarter.
Revenue grew 13.01 percent on an annual basis and a milder 2.21 percent sequentially to NT$16.89 billion, thanks to robust sales of system on a chip (SoC) and driver ICs for mobile applications, which contributed 30 percent and 70 percent respectively to overall sales, the company said.
Photo: Grace Hung, Taipei Times
Gross margin was better than expected, rising 0.39 percentage points to a record 33.2 percent, compared with Novatek’s forecast of 31 to 33 percent, due to a better product mix and nonrecurring engineering income, it said.
Novatek president Steve Wang (王守仁) was upbeat about the outlook this quarter, forecasting sales of between NT$17.7 billion and NT$18.5 billion, representing year-on-year increases of between 8.59 percent and 13.49 percent.
“Demand for SoC should drive growth this quarter,” Wang said, adding that orders for the company’s TV SoC solutions have continued to grow as it gained market share.
With 5G rollouts picking up speed in China, Wang said shipments of advanced touch controllers with display driver integration (TDDI) chip, which are set to outfit most 5G smartphones equipped with OLED screens, are expected to grow significantly in the second half of the year.
Based on estimated global smartphone shipments of 1.2 billion to 1.3 billion units this year, Wang forecast that TDDI chip shipments would reach between 600 million and 650 million, citing the company’s market penetration rate of 50 percent.
“There is still a lot of uncertainty in the consumer electronics market ... but if the novel coronavirus is contained by the end of this quarter, market demand should remain stable,” he added.
The demand for driver ICs is expected to continue to rise as the pandemic propels sales of laptops, tablets and monitors.
“We are seeing healthy demand for large display panel drivers, while demand for medium and smaller-sized panel drivers remains flattish,” he said, citing slow growth in automotive and Internet protocol camera applications.
The company would likely benefit from Samsung Electronic Co’s recent exit from the LCD panel market, Wang said, adding that he aims to increase Novatek’s market share to more than 30 percent.
Novatek’s board of directors yesterday proposed to issue a cash dividend of NT$10.5 per common share, representing a payout ratio of 80.58 percent based on earnings per share of NT$13.03 last year.
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