Lar­gan Pre­ci­sion’s Q1 gross mar­gin of 56.7% beats mar­ket ex­pec­ta­tions

The China Post - - TAIWAN BUSINESS -

Lar­gan Pre­ci­sion Co. ( ), one of Tai­wan’s lead­ing smart­phone cam­era lens sup­pli­ers, an­nounced Thurs­day a gross mar­gin of 56.7 per­cent for the first quar­ter of this year, beat­ing mar­ket ex­pec­ta­tions.

In an in­vestor con­fer­ence held Thurs­day, Lar­gan said that its first quar­ter gross mar­gin rose about 6 per­cent­age points from a quar­ter ear­lier to hit a new high in four quar­ters.

“I am im­pressed by Lar­gan’s lat­est gross mar­gin,” Mega In­ter­na­tional In­vest­ment Ser­vices Corp. an­a­lyst Alex Huang said, adding that his bro­ker­age had pre­vi­ously fore­cast that the first quar­ter fig­ure would stay lit­tle changed from a quar­ter ear­lier.

“The cam­era lens maker has ben­e­fited from an im­prove­ment in its prod­uct port­fo­lio in which high-end prod­ucts com­prised a large per­cent­age of sales, thus boost­ing the profit mar­gin,” Huang said. “The high mar­gin showed that Lar­gan still leads its peers in smart­phone cam­era lens pro­duc­tion tech­nol­ogy.”

Lar­gan said that it posted NT$ 4.41 bil­lion in net profit for the Jan­uary- March pe­riod, up 47 per­cent from a year ear­lier, while the first quar­ter fig­ure fell 41 per­cent from the pre­vi­ous quar­ter due to slow sea­son ef­fects.

In the first quar­ter, Lar­gan posted NT$32.86 in earn­ings per share (EPS) for the first quar­ter of this year, also beat­ing a pre­vi­ous mar­ket es­ti­mate. The first quar­ter fig­ure rose from NT$22.36 recorded in the same pe­riod of last year but fell from NT$55.4 reg­is­tered in the pre­vi­ous quar­ter.

Lar­gan’s first quar­ter EPS was the third high­est in com­pany his­tory, only trail­ing the NT$55.40 high recorded in the fourth quar­ter of last year and the NT$39.40 mark reg­is­tered in the third quar­ter of last year.

In the first quar­ter, 10- megapixel lenses ac­counted for 20-30 per­cent of its to­tal sales, 8-megapixel lenses made up 40- 50 per­cent, 5- megapixel lenses rep­re­sented 10-20 per­cent, and 1- megapixel lenses ac­counted for 10-20 per­cent, Lar­gan said.

Dur­ing this pe­riod, Lar­gan’s con­sol­i­dated sales t otaled NT$10.57 bil­lion, up 54 per­cent from a year ear­lier but down 37 per­cent from a quar­ter ear­lier.

Lar­gan CEO Adam Lin ( ) told in­vestors that with the slow sea­son ef­fects be­gin­ning to fade in the first quar­ter, the com­pany will see its sales growth pick up in the sec­ond quar­ter.

Be­fore t he re­sults were re­leased, shares of Lar­gan rose 1.46 per­cent to close at NT$ 2,785.00 on the Tai­wan Stock Ex­change. The stock is the most ex­pen­sive in the lo­cal mar­ket.

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