Compal Electronics swings to profit in Q2

Taipei, Aug. 14 (CNA) Compal Electronics Inc. said Thursday that it turned a profit for the second quarter from the previous quarter as the contract notebook computer maker reported no massive one-time loss as it did in the first quarter. Compal said the second-quarter earnings also reflected an increase in PC shipments at a time when the world's PC industry showed signs of recovery. The company added that solid global demand for smartphones also boosted its shipments and further strengthened its bottom line during the April-June period. In the second quarter, Compal posted NT$2.37 billion in net profit, compared with NT$2.26 billion in net loss recorded in the first quarter, when the company reported a one-time loss of NT$4.73 billion that resulted from an arbitration decision related to its investments in flat panel maker Chunghwa Picture Tubes Ltd. The second-quarter net profit was also up 70 percent from a year earlier, the company said. The earnings per share (EPS) for the second quarter stood at NT$0.55, compared with NT$0.53 in loss per share registered in the first quarter, the company added. In the April-June period, notebook computer shipments from Compal rose 19.10 percent from a quarter earlier to 10.60 million units, on the back of an increase in orders placed by the company's major clients, such as Hewlett-Packard, Dell and Toshiba. Compal incurred about NT$700 million in foreign exchange losses in the second quarter but enjoyed an increase in interest income and returns from non-core business investments and no one-time losses. As a result, the company's non-operating costs for the second quarter fell to NT$190 million from the first quarter's NT$3.77 billion. In the first half of this year, Compal's net profit totaled NT$103 million, with EPS of NT$0.02. Market analysts said Compal is expected to benefit from peak season effects in the third quarter, in particular in August and September. They said Compal's notebook computer shipments for the July-September period could rise 5-10 percent from a quarter earlier. (By Han Ting-ting and Frances Huang)