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Quanta shares under pressure after Q2 results

Quanta shares under pressure after Q2 results

Taipei, Aug. 15 (CNA) Shares of Quanta Computer Inc. came under pressure Thursday morning after the world's largest notebook computer ODM services provider reported a decline in its net profit for the second quarter due to weak global demand for personal computers, dealers said. Market sentiment has been hit, in particular, by a gloomy forecast for notebook shipments for 2013 by Quanta, which said its shipments are likely to fall 18 percent from a year earlier, the dealers said. As of 11:26 a.m., shares of Quanta had lost 2.51 percent to NT$62.20 (US$2.08) with 3.34 million shares changing hands. The weighted index on the Taiwan Stock Exchange was down 0.54 percent at 7,908.34 points. "Quanta's second-quarter results simply confirmed the weakness of the global PC market," Ta Ching Securities analyst Andy Hsu said. International Data Corp., a global market information advisory firm, has cut its global PC shipment forecast, saying that shipments this year will fall 7.8 percent from last year, compared with a previous estimate of a 1.3 percent decline. Under such unfavorable circumstances, Quanta announced in an investor conference held a day earlier that it posted NT$4.02 billion in net profit for the second quarter, or NT$1.05 in earnings per share (EPS), compared with NT$4.45 billion in net profit, or NT$1.16 EPS recorded in the first quarter. According to Quanta, its operating income for the April-June period reached NT$2.77 billion, less than its non-operating income of NT$2.86 billion. "Quanta benefited from non-operating income that largely came from investment returns and foreign exchange profits. Without its non-core business operations, its second-quarter results would have been uglier," Hsu said. In the first half of this year, Quanta's net profit fell to NT$8.48 billion from NT$11.13 billion recorded in the same period of last year. Its EPS for the six-month period stood at NT$2.21, down from NT$2.90 recorded a year ago. "Quanta's shipment forecast for 2013 dealt another blow to market sentiment, prompting many investors to think the global PC market will not see a peak-season effect in the third quarter," Hsu said. Quanta said it expects its 2013 notebook shipments to fall to 44 million, down 18 percent from 2012, while leaving the 2013 tablet shipment forecast of 20 million units unchanged. It could be the first year for Quanta to ship fewer than 50 million notebooks in five years. "I think foreign institutional investors continued to stand on the sell side today as they took cues from the gloomy shipment forecast," Hsu said. On Wednesday, foreign institutional investors sold a net of 659,858 Quanta shares on the main board. Hsu said the silver lining is that Quanta is trying hard to diversify its product portfolio by lowering the portion of notebooks in its product mix and raising investment in cloud technology development. "To my knowledge, the company's non-notebook operations have made up 35 percent of its total sales and are expected to increase, which could offset the impact from a shrinking PC market," Hsu said. (By Frances Huang)


Updated : 2021-01-26 14:50 GMT+08:00