Korea’s foundry DB HiTek Q2 OP more than doubles on qtr on a surge in chip orders

2019.08.14 15:15:11 | 2019.08.14 15:32:15

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South Korea’s mid-sized foundry DB HiTek Co. said its operating profit in the quarter ended June more than doubled from three months ago as demand for power chips, image sensors and touch sensor controllers stayed unaffected by the memory industry downturn.

DB HiTek in its regulatory filing on Wednesday said its consolidated operating profit reached 49.3 billion won ($40.6 million), up 120 percent from a quarter ago and 45.5 percent from a year earlier. Net profit jumped 94 percent on quarter but lost 8.6 percent on year to 31.27 billion won, while sales gained 33.8 percent and 22.6 percent to 213.5 billion won during the period.

DB HiTek shares on Wednesday finished 2.08 percent lower at 14,150 won in Seoul.

For the full first six-month period, the company raked in 71.67 billion won in operating profit, up 54 percent from the previous year. Net profit added 30.9 percent on year to 47.49 billion won, and sales 19.4 percent to 373.1 billion won.

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The stellar performance is largely owed to an increase in demand for its power chips, image sensors and touch sensor controllers for smartphones and closed circuit televisions (CCTVs), the company said. Power semiconductors, in particular, as high-value-added products contributed much to its earnings growth despite changing market conditions.

DB HiTek expects its earnings would continue to grow in the latter half of this year as its manufacturing lines in Bucheon, Gyeonggi Province and Eumseong, North Chungcheong Province are fully operational now, with a steady rise in orders and development of new products.

DB HiTek, founded in 1997 as Dongbu Electronics, has manufactured system semiconductors since early 2000s. It had been financially strapped with massive debts and losses but swung to a profit from 2014. The company in recent years has seen its operating margin hover above 20 percent, and its debt ratio improved to 92 percent this year with various efforts to improve balance sheet through share increases, asset sale and debt payoff.

By Ahn Byung-joon and Lee Ha-yeon

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