ALi Corporation (3041TT) today held its third quarter online earnings conference and announced consolidated revenue of NT$1,222 million, consolidated gross profit of NT$574 million with consolidated gross profit margin of 47%, consolidated operating income of NT$211 million with consolidated operating profit margin of 17%, net income of NT$189 million, and basic earnings per share of NT$0.64 for the third quarter ended September 30, 2012.
ALi Corporation stated that third quarter’s revenue, despite a 5% decrease on a quarter-over-quarter basis, was more promising than the third quarter guidance which predicted a decrease by 14-20%. The better-than-expected third quarter result was due to improvement on inventory build-up and a recovery of demand from end market in September following the decline in retail market seen in July and August. Benefiting from the demand to upgrade from standard definition to high definition and increase in mass production shipment of IP STB (OTT), as well as the result from years of cultivating relationship with Pay-TV operators, revenue in this quarter increased by 30% on a year-over-year basis. Consolidated gross profit margin was 47%, declining by 2 percentage points compared to 49% last quarter but representing an increase of 3 percentage points on a year-over-year basis, in line with the third quarter guidance of 46.2%-48.0%. Operating expenses declined by 4%on a quarter-over-quarter basis and operating profit margin of 17% was higher than previous guidance of 13.6%-14.0% thanks to better-than-expected revenue. Consolidated net income reached $189 million with a basic earnings-per-share of $0.64, higher than the estimated $0.40-0.43.
For the product line contribution of the third quarter, STB accounted for 90% of the revenue, similar to the ratios of the previous quarters. ALi’s STB end markets can be categorized into Retail HD, Retail SD Satellite, Retail SD Terrestrial, Retail IP STB (OTT), and Pay-TV operators, which accounted for 60~65%, 20~25%, 5~10%, 0~5% and 5~10% of STB revenue contribution respectively. As for geographical revenue breakdown, China accounted for 10-15% of total STB revenue, while Emerging Market for 50-55% and Europe & US for 35-40%.
Looking forward, the Chairman and CEO, Dr. Ben Lin, stated that skeptical outlook on the global semiconductor industry in the fourth quarter and concerns over economic risks in certain regions give rise to a more conservative view on the fourth quarter. Guidance for the fourth quarter’s consolidated revenue is expected to be between NT$1,160M and NT$1,280M, between an increase by 5% and a decrease by 5% on a quarter-over-quarter basis and an increase by 4-14% on a year-over-year basis, while consolidated gross profit margin between 45.0% and 47.0%, and consolidated operating profit margin between 15.0% and 17.0%.
