Handset camera lens maker Largan Precision Co (大立光) yesterday reported an 83.98 percent quarterly drop in earnings per share (EPS) for the second quarter, citing NT$4.22 billion (US$144.32 million) in foreign-exchange losses.
Due to a nonoperating loss of NT$3.08 billion for the second quarter, EPS came in at NT$7.73, compared with NT$48.28 in the first quarter, it said.
Net profit decreased 84 percent to NT$1.03 billion and revenue fell 20 percent to NT$11.76 billion from the first quarter, the Taichung-based company said.
Photo: CNA
The sharp appreciation of the New Taiwan dollar shaved about 2 percentage points off the company’s gross margin last quarter, Largan executive officer Adam Lin (林恩平) told an online investors’ conference.
Gross margin fell by 1 percentage point to 53.6 percent from the previous quarter, the company said. It reported gross margin of 48.48 percent a year earlier.
Every 10 percent rise in the NT dollar against the US dollar would cut the company’s gross margin by 4 to 5 percentage points, Lin said, adding that the firm’s cash holdings are now evenly split between the local currency and the greenback.
Largan is the world’s largest handset camera lens producer, supplying high-end products for Apple Inc and Android phone vendors, such as Samsung Electronics Co, Xiaomi Corp (小米) and Huawei Technologies Co (華為).
Customers front-loaded orders during the 90-day pause of the US’ tariffs announced in April, Lin said.
However, as most of the company’s products are not directly shipped to the US, the tariff impact is limited, but what deserves attention is that competitors are expected to enter the supply chain this year, he said.
Revenue this month is expected to outperform last month, while next month’s revenue appears likely to surpass this month, he said.
Meanwhile, Apple is expected to launch a new iPhone model in September, which should benefit the company, Lin said
The company plans to launch a variable aperture lens project next year, which could help boost average selling prices, he said.
As for the company’s newly developed high-precision visual recognition pr oducts for humanoid service robots, shipments in module form would begin in the second half of the year, but in limited quantities, he said.
While China’s rare earths export controls implemented in April temporarily disrupted shipments, supply to clients in the third quarter appears to be stable, he said.
Regarding overseas deployment, Lin said the company is still evaluating its options, emphasizing the challenges involved in relocation.
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