Hi-P

Hi-P: 3Q11 results weak. Recall the co previously issued a profit warning.
Revenue at $308.6m, +8.1% yoy, lower than expected due to delays in the ramping of certain programs by customers.
Net profit at $6.5m, -81% yoy, dragged by lower margins.
Gross margins collapsed to 8.7% from 22.6% yoy, mainly due to pricing pressure, higher material costs due to change in pdt mix, increased labor costs, additional costs due to activities arising from sites’ consolidation and higher depreciation of $2.2m due to chg in acctg estimates.
Nevertheless, mgt remains cautiously optimistic of its business prospects and competitiveness even under the current tough market conditions. Guides for higher revenue and profit in 4Q11 vs 3Q11, and expects higher revenue but lower profit in FY11 vs FY10 ($66.9m). At 9M11, net profit was $35.5m vs $31.1m yoy.
The stock trades at 7x trailing P/E, 0.8x P/B.