RIDING ON A strong recovery in the semiconductor industry, Serial System yesterday said it achieved 1Q net profit of $2.9 million, up 314% from $0.7 million in 1Q 09.
The company is not required to report quarterly figures as its market capitalization is below $100 million, but it voluntarily did so yesterday for its 1Q results to keep investors abreast of its performance.
If annualized, the $2.9 million translates into $11.6 million net profit – which would be a record for the company.
That would also be a 55% jump from last year’s $7.5 million profit.
Asked if the 1Q performance could be representative of that for the rest of the year, Dr Derek Goh, chairman and CEO of Serial System, told investors at a presentation at CIMB-GK Investment Centre yesterday:
“We can at least maintain at that level, barring any unforseen circumstances. Normally, in our history, the first quarter is usually a slow one compared to the rest of the year because of the Chinese New Year holidays. In China, we get no sales for about 10 days. In Taiwan, it’s 7 to 10 days.”
These two countries are major sources of revenue, accounting for 57% of Serial System’s revenue last year.
If Serial System achieves the $11.6 million profit figure derived from annualizing its 1Q result, then it would have beaten the forecasts of two of the three analysts who cover the stock.
Earlier, after the release of Serial’s FY09 results in February, these analysts had forecasted the following for Serial’s 2010 full-year profit:
* William Tng (CIMB-GK): $11.9 million;
* SIAS Research: $10.8 million;
* Jacky Lee (NRA Capital): $10.0 million.
Their target prices for Serial's share price (closed yesterday at 10 cents) were 16 cents, 14 cents and 14 cents, respectively.
As for its revenue, Serial’s 1Q figure was $182.4 million.
If annualised, the full-year figure would be $729.6 million, exceeding also the analysts’ forecasts – all of whom cited $640.0 million.
Serial distributes a wide range of components to a number of industries which are riding on a boom, including:
* Consumer electronics: Components that Serial distributes are used in devices such as washing machines, TV sets, DVD recorders, MP3 players and wireless headsets.
* Automotive: Serial’s distributed components are used in gadgets such as portable navigation systems, car access systems (RFID) and in-car infotainment systems.
Serial System's powerpoint presentation which was uploaded to the SGX website yesterday can be downloaded here.
Recent story:
SERIAL SYSTEM (10 c): 'Intrinsic value is 14 c'
Stock Price
AEM Holdings (AWX) 2.360 0.010 (0.43%) Best World (CGN) 2.440 -0.040 (-1.61%) Boustead Singapore (F9D) 0.960 0.010 (1.05%) Broadway Ind (B69) 0.128 -0.001 (-0.78%) China Aviation Oil (S) (G92) 0.910 0.005 (0.55%) China Sunsine (QES) 0.410 0.000 (0.00%) ComfortDelGro (C52) 1.460 0.010 (0.69%) Delfi Limited (P34) 0.900 0.000 (0.00%) Food Empire (F03) 1.320 0.000 (0.00%) Fortress Minerals (OAJ) 0.320 0.005 (1.59%) Geo Energy Res (RE4) 0.305 -0.010 (-3.17%) Hong Leong Finance (S41) 2.490 0.010 (0.40%) Hongkong Land (USD) (H78) 2.850 0.030 (1.06%) InnoTek (M14) 0.535 0.000 (0.00%) ISDN Holdings (I07) 0.295 -0.010 (-3.28%) ISOTeam (5WF) 0.043 0.004 (10.26%) IX Biopharma (42C) 0.045 -0.003 (-6.25%) KSH Holdings (ER0) 0.250 0.000 (0.00%) Leader Env (LS9) 0.050 0.002 (4.17%) Ley Choon (Q0X) 0.043 0.000 (0.00%) Marco Polo Marine (5LY) 0.069 -0.002 (-2.82%) Mermaid Maritime (DU4) 0.139 -0.003 (-2.11%) Nordic Group (MR7) 0.315 -0.010 (-3.08%) Oxley Holdings (5UX) 0.089 0.001 (1.14%) REX International (5WH) 0.135 -0.002 (-1.46%) Riverstone (AP4) 0.795 -0.010 (-1.24%) Southern Alliance Mining (QNS) 0.445 -0.005 (-1.11%) Straco Corp. (S85) 0.485 0.000 (0.00%) Sunpower Group (5GD) 0.210 0.000 (0.00%) The Trendlines (42T) 0.069 0.000 (0.00%) Totm Technologies (42F) 0.022 -0.001 (-4.35%) Uni-Asia Group (CHJ) 0.825 0.005 (0.61%) Wilmar Intl (F34) 3.380 0.010 (0.30%) Yangzijiang Shipbldg (BS6) 1.770 -0.010 (-0.56%)
