Phoenix Semiconductor Posts 11% Net Income Growth to $10.15M
Clark Freeport Zone, Pampanga—(PHStocks)—Phoenix Semiconductor Philippines Corp. (PSE: PSPC) posted a net income after tax of $10.15 million for the six months of 2015, up nearly 11% from the $9.17 million posted in the same period last year. This translates to earnings per share of $0.0047, compared to $0.0046 in the first semester of 2014.
Gross revenues increased 8% to reach $118.25 million from the $109.85 million in 2014. The increase was contributed by 7% increase in the sales revenues from dynamic random access memory modules utilized principally for servers and personal computers and the 13% growth in sales revenues of memory chips which are used in mobile smart phones, tablets, laptops and other devices.
“As a preferred outsourced semiconductor assembly and test provider of memory chips and modules for Samsung, PSPC continued to serve a significant proportion of Samsung’s requirements for DRAM modules,” Dongjoo Kim, PSPC Vice President and Chief Finance Officer declared.
He explained that more than 50% of the volume output of the Company’s fully automated facility in Clark Freeport are for DRAM modules, principally for servers. The balance of 48% of output revenues represent production of memory chips for PCs, laptops and mobile devices and another 2% for flash memory cards.
The server applications market has been on a steady growth path compared to the fluctuating performance of highly competitive mobile phone and PC/laptop applications market. These latter markets have been experiencing flat growth in view of the slowdown in China and in Europe.
“As a component of Samsung’s back-end supply chain, we are committed to supporting its product mix strategies with production capacity to meet the changing needs of the end-user market,” Kim noted. Server-based DRAMs have higher value than those for PCs and laptops.
PSPC also took note that it continued to benefit from productivity gains, as reflected in the faster growth in profitability relative to sales revenues. Cost of goods sold (raw materials, depreciation, direct labor, and other manufacturing costs etc.) increased from $95.87 million to $103.33 million during the period in review. Moreover, financing costs were reduced 23% from $2.72 million in 2014 to $2.08 million by the end of June 2015.
PSPC’s balance sheet continued to be solid with a total asset of $196.69 million by the end of the first semester of 2015. The company remains liquid with current assets amounting to $73.95 million as against its current obligations of $57.31 million, resulting in current ratio of 1.29:1.
Kim believes that the end-user electronics market will stage a rebound in the fourth quarter of 2015, to be driven by the recovery and increased consumer spending of developed countries during the December peak months. PSPC supplies part of the memory device requirements of HP, Dell, Lenovo, Toshiba, among other consumer electronic brands being served by Samsung South Korea.
PSPC, he concluded, is ready to quickly ramp up production and take advantage of the anticipated recovery and growth of the global technology market in the second semester of the year.