(By Balaseshan) Nam Tai Electronics Inc. (NYSE: NTE), which provides electronics manufacturing and design services, swung to a quarterly profit on mass production of high-resolution liquid crystal display modules and discontinuation of certain poor performance sales orders, sending shares up 14.68% in premarket.
Earnings for the fourth quarter were $36.61 million or $0.80 per share, compared to a loss of $5.61 million or $0.13 per share last year.
Net sales increased to $468.46 million from $129.07 million. Telecommunication components assembly sales grew to $459.62 million from $123.5 million, while flexible printed circuit sales increased to $8.85 million from $5.58 million.
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The company said sales increased as a result of its Shenzhen manufacturing facility began mass production of high-resolution liquid crystal display modules (LCMs) for smartphones in September 2012 and its Wuxi manufacturing facility continued to ramp up its production of high-resolution LCMs for tablets.
Gross margin for the fourth quarter was 10.5%, up from 1% in the same period of previous year, due to discontinuation of certain sales orders that have had poor performance, the company noted.
The company projects it will continue to drive its growth in 2013 of its existing production capacity and production facilities. Due to the high level of competition in the market for tablets, smartphones and ultrabook computers, the company expects its customer orders will continue to fluctuate and its gross profit would also be under more pressure in 2013.
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NTE closed Friday's regular session at $13.83. The stock has been trading between $4.75 and $16.37 for the past 52 weeks.