Due to sluggish sales of medium and large-sized backlight products, one of its main businesses, Ruifeng Optoelectronics (12.080, 0.00, 0.00%) (300241, previous closing price of 12.08 yuan) may experience a certain decline in net profit in the first quarter of this year. The company stated in its first-quarter performance forecast released on March 31 that net profits attributable to shareholders of listed companies fell by 0 to 20% compared with the same period last year.
Yesterday (April 1), Ruifeng Optoelectronics’ secretary-general Zhuang Jili said in an interview with a reporter from the "Daily Economic News" that the current medium and large-sized backlight market is saturated, and it is difficult to grow bigger.
It is understood that medium and large size backlight products are mainly used in LED TVs. Ruifeng Optoelectronics' prospectus shows that Konka, Skyworth and Changhong are all its customers. Currently, medium and large-sized backlight LEDs are Ruifeng Optoelectronics’ second largest business. In 2013, the company's revenue from this business was 290 million yuan, while the revenue from its largest business, lighting LED, was 330 million yuan.
Ruifeng Optoelectronics' medium and large-sized backlight products have experienced a period of rapid development. The company's 2012 annual report shows that the business grew by 169.31% year-on-year, with a gross profit margin of 24.04%. In the first half of 2013, Ruifeng Optoelectronics' medium and large-sized backlight LED products still maintained a growth rate of 112.55%, with a gross profit margin of 26.11%. However, the 2013 annual report showed that the medium and large-sized backlight business declined, and the operating income of this business fell by 0.72% year-on-year. In its performance forecast for the first quarter of this year, the company stated that "medium and large-sized backlight products, which contribute significantly to the company's profits, have experienced a slight decline, resulting in a year-on-year decline in the company's overall profits."
Zheng Liyao, deputy director of the Gaogong LED Industry Research Institute, told the "Daily Economic News" reporter that the previous market share of medium and large-sized backlight products was mainly in the hands of Taiwanese companies. With the development of the mainland's LED industry and technological advancement, the gap between mainland companies and Taiwanese companies continues to narrow.
Zhuang Jili told reporters that starting from the second half of 2012, the large-size backlight market began to grow rapidly. At present, there is no large-scale replacement demand, the market is becoming saturated, and it is difficult to expand.
In addition to external market environment reasons, there are also Ruifeng Optoelectronics’ own reasons. "There were a number of personnel changes last year, so we didn't do very well. Through adjustments this year, we hope to win back this market." Zhuang Jili said.
At the same time, he also said that the entire LED lighting market is very hot, and the company's investment will focus on lighting.
ANNA