E Ink Holdings Inc (元太科技), the world’s largest e-paper display supplier, yesterday said it expected revenue to resume growth momentum in the second half of this year, as inventory corrections for electronic shelf labels (ESLs) come to an end and demand for colored e-paper displays for e-readers increases.
“The second quarter was the trough for our ESL business, but entering the third quarter we have seen positive growth and found most new projects switch to four-color e-paper displays,” E Ink chairman Johnson Lee (李政昊) said at an investors’ conference.
The company has built its optimism on more retailers in Europe and the US moving toward automation and digitization, Lee said.
Photo: Wu Hsin-tien, Taipei Times
“Overall, we are looking at a quarterly improvement in the remainder of this year,” Lee said. “ESL business has returned to the normal growth track. Consumer products [e-readers and e-notes] would return to the growth path because of colored displays.”
Lee made the remarks as the company reported that its second-quarter net profit soared 53 percent to NT$2.02 billion (US$62.5 million) from NT$1.32 billion in the first quarter.
That was the first quarterly growth since the second quarter of last year. On an annual basis, net profit dipped 17 percent from NT$2.42 billion.
Earnings per share rose to NT$1.76 last quarter from NT$1.16 in the prior quarter, but declined from NT$2.12 a year earlier.
Revenue in the third quarter rose 36 percent to NT$7.66 billion from NT$5.64 billion in the first quarter.
Gross margin improved to 47.52 percent last quarter from 47.34 percent in the first quarter. However, the figure dropped from 53 percent a year earlier due to lower yield rates for new colored e-paper displays.
E Ink is concentrating its resources on penetrating digital signage markets and collaborating with electronic goods vendors including Sharp Corp, Royal Philips NV and Samsung Electronics Co to explore potential applications, the company said.
Grocery stores and fashion retailers have provided positive feedback about replacing existing paper advertisements with colored e-paper displays, E Ink said, adding that the transportation sector is also a potential market, it said.
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