D-Link 2013 Q1 Operation Review

2013-05-15

For the first quarter 2013, net revenue was NT$7.223 billion, down by 11.4% sequentially and down by 12.2% year over year due to seasonality in the retail market and slower pull-in from telco projects especially in Eastern Europe and emerging markets due to local economic recession.  We also experienced a supplier chain delay due to the Chinese Holiday which slowed down the push out of the fast growing products such as IP camera and 11AC routers.  Gross margin excluding inventory provisional gain/loss was NT$2.023 billion or 28.0% as compared to 27.0% last quarter due to better product mix.  Gross margin including inventory provisional gain/loss was NT$1.964 billion or 27.2% in 1Q13, as compared to 28.5% in 4Q12.  Operating expenses were reduced to NT$1.8 billion or 25.3% of net revenue as compared to 25.1% of previous quarter as a result of the lower revenue base.  Operating profit margin was 1.9% as compared to last quarter 3.4%.  Net non-operating profit in 1Q13 was NT$47 million comprising of NT$23 million income recognized from long term investee companies under equity method, NT$25 million capital gain, NT$8 million in foreign exchange loss, and NT$7 million derived from financial and other income.  The Group’s first quarter consolidated net income after tax and minority interest was NT$124 million and EPS was NT$0.20 per share based on weighted average capital of NT$6.160 billion.