Smartphone camera lens maker Largan Precision Co (大立光) last quarter reported NT$8.14 billion (US$255.26 million) in net profit, the highest in three years and a spike of 54.7 percent from a year earlier, although gross margin weakened due to a less optimal product mix, company executives said yesterday.
The results translated into earnings per share of NT$61.01 as combined revenue soared 39 percent from three months earlier to NT$13.48 billion, helped by the release of Apple Inc’s new iPhone series, company data showed.
“The impressive sales result came after shipments of VCM [voice coil motor] camera modules picked up and favorable foreign exchange rates lent support,” Largan chairman and chief executive officer Adam Lin (林恩平) told an online investors’ conference.
Photo: David Chang, EPA-EFE
Business this quarter would hold roughly steady from last quarter, Lin said, adding that the company has a similar outlook for next year.
Some customers have asked for upgraded solutions in their flagship products next year, while others favor downgraded specifications due to cost concerns and conservative sales projections, Lin said.
The increase in VCM module shipments caused gross margin to shrink 2.12 percentage points to 53.7 percent last quarter, as the product is on the cheaper side, investor relations official Josephine Huang (黃印嘉) said.
Meanwhile, foreign currency and non-core operations generated NT$4.14 billion in net income, Huang said.
Customers looking for cheap devices would not place orders with Largan, which only accepts orders that promise reasonable margins, Lin said.
The Taichung-based company has no intention of expanding VCM module capacity next year and would press ahead with existing capacity expansion plans, Lin said.
It would spend more on the research and development of periscope lenses, he said.
Variable apertures remain challenging in terms of technology, as customers look to refine their quality, Lin said.
Medium to high-resolution modules with 10 megapixels (MP) drove 50 to 60 percent of lens shipments last quarter, followed by 5MP modules, while high-end 20MP lens modules made up 10 to 20 percent of shipments, the company said.
Lin declined to comment on gross margin movements going forward, saying only that much depends on the sales of the latest smartphone models.
Largan also supplies lenses for virtual-reality gadgets, vehicles and drones, but so far they have generated lower margin than smartphones, he said.
Net profit in the first three quarters soared 37 percent to NT$18.6 billion, or earnings per share of NT$139.37, outperforming the whole of last year, company data showed.
Largan shares yesterday closed down 0.29 percent at NT$1,745 in Taipei trading, outperforming the TAIEX’s 2.07 percent fall, Taiwan Stock Exchange data showed.
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