industry stocks
Table
1.In the last 12 months none of the compound semiconductor chipmakers has performed better than the NASDAQ
Riber reported strong results for the last fiscal year, which finished on 31 December 2011. Sales of MBE systems rose by a modest 4 percent, but revenue for cells and sources leapt nearly four-fold. Investment in capital equipment for new production lines for making organic LED screens in Asia accounted for this hike, and helped to drive up Riber’s year-over-year revenue by 40 percent to €29.0 million. Profit also jumped, rising from €1.8 million in 2010 to €4.3 million in 2011.
At the end of March, the company recorded quarterly revenue of €6.2 million, up 8 percent compared to the same quarter of 2011. During those 12 months the order book fell by €1.8 million to €19.5 million, which included requests for shipments of 13 research systems and one production machine by the end of next year.
The weakening order book results from a contraction in orders of cells and sources for OLED production. However, Riber is now preparing a new generation of cells to catch the next wave of investment in this industry.
Teleco woes
Propping up this year’s table is US-headquartered Oclaro, which was formed in 2009 through the merger of telecom component makers Bookham and Avanex. Back in March 2011 Oclaro’s shares hit $18, the high- point since the merger, but they plummeted throughout that summer, and are now worth less than $3.
Oclaro posted weak quarterly figures during that period of falling share value. Revenue for the fourth fiscal quarter 2011 that finished on 28 July 2011 was $109.2 million, down $6.5 million quarter-over-quarter, and more worrying, operating loss rocketed from $6.6 million to $33.6 million (however, the latter did include $20 million of impairment charges). The company blamed an extended slowdown in the telecom sector for the poor figures. Three months on, revenue had fallen to $105.8 million, in line with previous guidance, losses were reduced to $9.6 million, but
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www.compoundsemiconductor.net June 2012
production in Thailand had been halted due to flooding.
This flooding impacted second quarter 2012 revenue, which fell to $86.5 million, and contributed to high operating losses – $33.6 million, which includes $9.1 million of flood-related write-offs.
The impact of the floods also made an impact on the most recent quarterly earnings, which were announced on April 26. Sales had risen slightly quarter-over-quarter to $88.7 million, and could have been about $4 million higher still, if it had not been for a 10 day stoppage at the Shenzhen factory, which has subsequently been resolved. Oclaro is trying to sell this factory, and is planning to move production from this site to Malaysia, where it believes there is a much more stable manufacturing environment.
Another, bigger change for Oclaro will be its merger with Opnext. Oclaro’s chairman and CEO Alain Couder believes that this move will be welcomed by customers, who want to work with fewer, more strategic suppliers who can deliver the breadth of technologies they need.
“Through this merger, [Oclaro’s and Opnext’s] complementary and vertically-integrated product portfolios, scale, and heritage of technology innovation will put the merged company in that valued strategic partner and leadership role.”
The merger should position the new company as the second biggest player in the optical components and modules market, behind Finisar. But can this marriage can halt the declining share prices of both companies, and create a profitable enterprise? Time will tell, and the result should be evident on next year’s leader board, which will hopefully show that III-V shares have lost that sinking feeling.
Disclaimer. Richard Stevenson holds a small number of shares in IQE
© 2012 Angel Business Communications. Permission required.
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