Contract electronics manufacturer Inventec Corp (英業達) on Tuesday projected revenue growth for its three major product lines this year, and said that inventories have returned to healthy levels.
The growth trajectory for this year would resemble that of last year, despite a relatively poor performance this quarter, Inventec president Maurice Wu (巫永財) told an online investors’ conference.
Business should improve in the second and third quarter, before retreating slightly in the final quarter of the year, Wu said.
Photo: Fang Wei-chieh, Taipei Times
Wu described the company’s current inventory level as “normal and healthy,” rather than a burden that has been plaguing other electronics manufacturers.
The company aims to cut its inventory turnover to 30 days in the near future from 40 days this quarter, he said.
As its three major product lines — servers, notebook computers and mobile devices — are projected to continue to grow, the company’s overall revenue this year would be higher than last year, he said.
Wu gave the cautiously optimistic guidance after releasing the company’s fourth-quarter financial results.
Net profit for the October-to-December period tumbled 20.35 percent from three months earlier, but climbed nearly 17 percent from a year earlier to NT$1.37 billion, or earnings per share of NT$0.39, company data showed.
Fourth-quarter revenue dropped 5.4 percent quarterly and 9 percent annually to NT$134.76 billion, but gross margin gained 0.05 percentage points to 5.2 percent from the previous quarter, thanks to a better product mix, Wu said.
For the whole of last year, net profit shrank 6.3 percent from 2021 to NT$6.13 billion, translating into earnings per share of NT$1.71, company data showed.
The company’s revenue last year grew 4 percent to NT$541.75 billion and gross margin improved 0.5 percentage points to 4.8 percent, but higher operating expenses and lower investment income cut into profitability, it said.
The company plans to distribute a cash dividend of NT$1.5 based on last year’s earnings, suggesting a payout ratio of 88 percent and a yield of 5.52 percent based on Tuesday’s closing price of NT$27.15.
Shares closed 0.18 percent higher at NT$27.20 yesterday.
Inventec is seeking to mitigate the effects of a seasonal slowdown in the first quarter, Wu said, adding that it should be able to meet its goal if business fares well this month.
As for server sales, business group president Tsai Chih-an (蔡枝安) said that demand would gain better momentum from next quarter, with first-half sales making up 45 percent of full-year revenue and the second half contributing 55 percent.
Servers used in artificial intelligence are expected to contribute 10 to 15 percent, as most clients need them for cloud and standby services, Tsai said.
Mobile devices would be the main revenue driver in the second half and would be stronger than last year, the company said.
Additionally, Inventec is working to tap into 5G, automotive and medical applications in the coming two to three years, Wu said.
Related revenue is small at present, but is expected to see twofold growth annually in 2025, helped by a low base, Wu said.
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