Taiwan’s digital camera makers, which account for about 40 percent of the world’s production, turned in strong results during the third quarter even as the global economy headed into a downturn.
Altek Corp., which makes digital cameras for brand-name vendors in the U.S. and Japan, reported that its revenues rose by 37 percent during the third quarter this year from the same period a year earlier.
The company said that its products are well positioned for the current slump in the global economy, and the company expects that the features and prices of its digital cameras will continue to win favor with consumers during this year and in 2009.
“Altek is still quite optimistic,” Chief Information Officer Martin Liu said in an October 23 conference with investors. “We can cooperate with our customers to deliver some decent products when the market is going down. We have not seen any order-decrease requests from our customers.”
The situation is much the same with Taiwan’s other major companies in the digital camera business such as Ability Enterprise Co., Asia Optical Co. and Largan Precision, which had strong sales figures during the third quarter this year. Asia Optical, which makes lenses for digital cameras, reported to the Taiwan stock exchange authorities that its revenues rose by 95 percent during the period. Largan, which also makes lenses, had a 49 percent jump in revenues. Digital camera maker Ability Enterprise reported a 9 percent increase.
The companies are shrugging off a slump in the world economy.
“The world economy is entering a major downturn in the face of the most dangerous financial shock in mature financial markets since the 1930s,” the International Monetary Fund (IMF) said in an October report. “Global growth is projected to slow substantially in 2008, and a modest recovery would only begin later in 2009.”
Altek said that so far this year its revenue performance has exceeded global market growth. The company cited statistics from Japanese market research firm Techno Systems Research indicating that global shipments of digital cameras in the third quarter rose 3 percent from a year earlier.
Global demand for digital cameras may be slowing. Shipment growth, which exceeded 20 percent during the first quarter and second quarter this year, fell to 16 percent during July and August, according to statistics from the Camera & Imaging Products Association, a Japanese group that also covers the digital camera market.
Still, Altek said it expects 60 percent of its full-year revenue to come in the second half of this year.
The company’s main products are digital cameras with resolutions in the 7 to 8 megapixel range. During the fourth quarter, more than 50 percent of the company’s revenue will come from 9 to 10 megapixel cameras, the company said.
Altek says it is Taiwan’s only digital camera maker with the ability to design key components such as controller chips and software. Altek’s chips enhance the photos its cameras take.
The company counts large brand-name vendors in the U.S. and Japan as its customers.
Looking ahead to the fourth quarter, Altek said that as production efficiency continues to improve, gross margin may continue to grow. Altek’s gross margin during the third quarter was 15.6 percent.
“There is some room to improve gross margin in the fourth quarter,” Liu said.
The company is looking at mobile phones equipped with digital cameras as a “new opportunity”, Liu said. The company sees camera phones with 5 megapixel resolution as an entry opportunity, he said. The company has been working with mobile phone companies and expects the 5 megapixel modules it makes for handsets to be a significant contributor to revenue by the middle of 2009.
Altek Corp., www.altek.com.tw
