ALi Corporation (3041 TT) today held its first quarter online earnings conference and reported audited consolidated financial results for the first quarter ending March 31, 2012 with a revenue of NT$1.43 billion, a gross profit of NT$692.1 million, an operating income of NT$300.4 million, a net income of NT$266.6 million, and an EPS of NT$0.91.
On a year over year basis, first quarter revenue increased by 91%, while gross profit increased by 88%, operating income increased by 172%, net income increased by 100%, and EPS increased by 107%. Compared to the fourth quarter of 2011, first quarter results represented a 27% increase in revenue, a 35% increase in gross profit, a 55% increase in operating income, a 79% increase in net income, and a 78% increase in EPS. All figures were prepared in accordance with R.O.C. GAAP.
The company stated that the better than expected first quarter results were driven by long-term growth drivers and short-term catalysts. In a longer-term perspective, the company has been cultivating relationship with Pay-TV operators for a couple of years, as well as developing various types of high-definition Set-top boxes and IP based connected media players, all three of which are generating more revenue than ever before. Besides, the fact that more high-definition programs are being launched ahead of schedule in the emerging markets also led to the increase of the revenue contribution from the company’s high-definition product line. On the short-term side, most of Western European countries are scheduled to switch off analogue signals by the first half of 2012, which was the reason behind the strong growth momentum in the standard-definition terrestrial and high-definition satellite segments over the past few months.
As to the product line contribution to the first quarter revenue, STB and Digital Audio accounted for 96% and 4% respectively. On a quarter over quarter basis, STB increased by 32% while Digital Audio decreased by 29% due to a slow season effect.
Based on different market segments, ALi’s STB market can be categorized into Retail HD, Retail SD Satellite, Retail SD Terrestrial, and Pay-TV Operator, accounting for 63%, 22%, 9%, and 6% of ALi’s STB revenue contribution respectively.
In terms of geographical revenue breakdown, China accounted for 8% of ALi’s total STB revenue, while Emerging Countries for 57% and Europe/US for 35%.
Looking forward, the President, Dr. Ben Lin, stated that due to the switch-off of analogue signals in Western European countries, the first quarter numbers would pose as a high revenue base for future quarters. As the deadline for the switch-off will soon come up, the effects of the company’s short-term catalysts are likely to wear off. As such, guidance for the second quarter revenue is expected to be between flat to down 10% quarter on quarter, which is still up 46%~62% year on year, while gross margin between 48%~50% and operating margin between 16%~19%.
