Stats ChipPAC

Stats ChipPAC: 1Q14 saw net loss of US$15.8m, reversing net profit of US$3.5m in the quarter a year earlier, while revenue fell 10.1% to US$365.5m on weaker demand in the wireless communications market targeted at the high-end smartphone segment, but partially offset by strength in the low-cost smartphone segment. Gross margins shrunk 5.4ppt to 10% due to Stats ChipPAC’s high operating leverage. There was also US$2.3m impairment in the quarter for a 200mm wafer packing equipment. Management expects next quarter’s net revenue to increase by 9-14%, with EBITDA in the range of 20-25% as a percentage of revenue, based on purchased orders received or expected to receive, taking into account periodic forecast guidance by customers. NAV at end Mar is US$0.43, translating to 0.74x P/B.