D-Link 2011 Q4 Operation Review

2012-03-02

For the fourth quarter 2011, net revenue was NT$8.13 billion, down by 4.9% sequentially and down by 11% year over year due to weak end user demand in the developed markets and inventory adjustment by channel and project partners in the emerging market.  Gross margin excluding inventory provisional gain/loss was 30.6% as compared to 32.7% last quarter due to unfavorable foreign exchange fluctuation and more incentive rebates and seasonal programs aimed to promote sales.   Gross margin including inventory provisional gain/loss was 30.0% in 4Q11, as compared to 31.5% in 3Q11.  Operating expenses were stable at 28.5% of net revenue as compared to 28.3% in 3Q11.  Operating profit margin was lower to 1.5% sequentially from 3.2% in 3Q11 as result of lower gross margin.  Net non-operating profit in 4Q11 was NT$134 million comprising of NT$162 million income recognized from long term investee companies under equity method, NT$91 million investment impairment losses related to three investee companies, NT$11 million in foreign exchange loss, and NT$74 million derived from financial and other income.  The Group’s fourth quarter consolidated net income after tax and minority interest was NT$215 million and EPS was NT$0.34 per share based on weighted average capital of NT$6.393 billion.