BenQ posts Q2 loss due to shipment delay

01 Sep 2006

BenQ, Taiwan's largest maker of mobile phones, posted its third consecutive quarterly loss for the April-June period, following its delay in a plan to increase handset shipments.

The company said it had an unaudited net loss in the three months ended June 30 of NT$2.51 billion ($76.45 million), reversing a net profit of NT$480.6 million ($14.6 million) it reported for the same period a year earlier.

A delay in a plan to increase mobile phone shipments was the main cause for the loss, BenQ said. The company's flat-screen monitor revenue also declined in the second quarter, the company said, without elaborating.

BenQ had a first-quarter net loss of NT$4.99 billion ($149 million).

Consolidated revenue for the second quarter totaled NT$54.85 billion ($1.67 billion), higher than the NT$29.67 billion ($902 million) for the same period last year.

Analysts expected BenQ to post weak quarterly results as it continued to try to integrate the unprofitable mobile-phone division it bought from Siemens in late 2005.

Slow progress in integrating BenQ's Taiwan and European operations was also among the reasons for delays in the launch of new handsets, analysts said.

BenQ chairman K.Y. Lee also unveiled a plan to improve the company's corporate structure by separating its contract manufacturing business from its brand business in 2007.

Apart from selling phones under its own name, the company also supplies handsets to other companies, such as NEC.

Lee said BenQ may bring in a strategic partner for the spinoff of its contract manufacturing division in 2007.

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