Acer Sertek (
H. T. Chou, finance controller at Acer Sertek, said yesterday that the company had sold 1.013 million TSMC shares and 1.2 million Taiwan Cellular shares during September. The profit from the shares sale will add NT$111 million to this month's pre-tax profit, he said.
The company had announced the share sell-off at the beginning of the year, and said the profits from the sell-off would be included in the financial profit forecast for the year, Chou said.
The sell-off therefore bears no reflection on Acer Sertek's current performance, he said. "This was part of the original plan."
However, a fourth quarter that is unlikely to be the peak selling season that was expected earlier in the year and a depressed stock market will both have an effect on operations, analysts said.
While the company should meet its financial target for the year, the sale of the shares will guarantee that still happens even if a general slowdown means less-than-expected revenue over the remaining months of the year, they said.
"The second quarter results were better than expected," said James Ti, electronics analyst at International Securities.
As a result, much was expected of the traditionally peak second half of the year.
However, slowing PC demand and a falling stock market have meant the company has had to fall back on its original plan of selling shares to reach its financial target, said Ti.
In the six months ended June 30, Acer Sertek's revenue increased 27.20 percent over the same period last year to NT$10.42 billion on the back of strong notebook PC sales.
July revenue fell by 1.8 percent from one month earlier, and August profits were raised by the sale of shares in TSMC and Taiwan Cellular.
"Revenue is still pretty good, with no big fall in July or August," said Ti. "Profits this month shouldn't be much lower than expected," he said.
Nevertheless, the share sale should guarantee that no targets are missed. "If the sales profit were still meeting its original target, it wouldn't be necessary to sell those shares. If it were to sell them anyway, it might have raised its financial forecast again," commented Ti.
Acer Sertek raised its financial target for the year in March after that month's revenue posted a record high and revenue in the first quarter had risen by 35 percent over the same period a year earlier.
The company raised its revenue target for the year by 19.4 percent to NT$21.50 billion, and its net profit forecast by 113.2 percent to NT$11.46 billion.
Revenue to the end of August accounted for 65 percent of its target figure for the year.
The company isn't hiding the fact that weaker market demand is having an effect on operations. "The fourth quarter is normally the hot season," said H. T. Chou. "Last year saw 20 percent growth. This year, it won't be so much," he said.
Chiang Bo-wen, president of Acer Sertek, was quoted in local media as saying market demand in the third quarter hadn't been as good as anticipated.
As a result, information product sales growth had made a correction downwards, he said.
Meanwhile, the effects of slower economic growth and the depressed stock market on consumers' buying power in Taiwan would be to slow down business in the fourth quarter, he said.
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