Giantplus Technology Co (凌巨), which makes small LCD panels for car displays and handsets, yesterday reported an 18.8 percent annual decline in net profit for last quarter as a strong New Taiwan dollar eroded the company’s earnings.
Net profit fell to NT$106 million (US$3.51 million) in the January-to-March quarter, from NT$130.82 million in the same period last year, the company’s financial statement showed.
That translated into earnings per share of NT$0.24, up from NT$0.3.
However, Giantplus reported a sharp increase in operating income, indicating an improvement in its core business.
In the first quarter, operating income soared nearly 89 percent annually from NT$171.93 million to NT$324.22 million, as gross margins rose to a historical high of 19.8 percent from 15.1 percent, company data showed.
Increasing demand for displays used in higher-margin industrial devices from Europe, North America and Japan has helped lift gross margin, the Miaoli County-based company said in a statement.
However, unfavorable foreign exchange rates have cut the company’s profitability, Giantplus said.
The company suffered NT$200 million in foreign exchange losses last quarter, it said, while its nonoperating losses last quarter totaled NT$179 million, compared with nonoperating loss of NT$44 million a year ago, the financial statement showed.
On a quarterly basis, net profit plunged 60 percent from NT$267.8 million, or NT$0.6 earnings per share, while gross margin climbed from 15.8 percent, Giantplus said.
The company’s shares yesterday closed 0.3 percent higher at NT$16.5 in Taipei trading before the release of its latest quarterly results.
The stock has underperformed the broader market by 4.7 percent since the beginning of the year, Taiwan Stock Exchange data showed.
Shareholders yesterday approved the nomination of Jin Endo as Giantplus’ new chairman and three other board directors during an extraordinary meeting.
The board director’s re-election came as major shareholder Chunghwa Picture Tubes Ltd (中華映管) in March sold off its entire 54 percent stake in the company to Japanese peer Ortus Technology Co Ltd for about NT$2.54 billion.
Endo is president of Ortus Technology.
Tokyo-based Ortus Technology is a subsidiary of Japan’s Toppan Printing Co Ltd.
Giantplus revenue total NT$4.03 billion in the first four months of the year, up 5.33 percent year-on-year.
Following the completion of the acquisition, Endo said in the statement that Giantplus aims to enhance its competitiveness by integrating technologies and resources with its parent company, which would also help it build a greater presence in the display market.
“Giantplus is also confident that it will create a synergy to help maximize its profitability going forward,” Endo said.
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