ENNOSTAR (3714) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue reached NT$5,632 million, up 2.3% quarter-over-quarter and 0.9% year-over-year, driven by TV backlighting, automotive, and sensing applications, with early customer purchases ahead of tariffs.

• Net loss attributable to parent company narrowed to NT$437 million, with a net profit margin of -7.8% and loss per share of NT$0.60.

• Gross margin improved to 12.2% from 9.4% in 4Q24, matching prior year levels.

• Strong cash position maintained, with net cash at NT$12,088 million after deducting bank loans.

• Consolidated financials reviewed with a qualified conclusion due to certain subsidiaries' unaudited statements, though these are not significant to the group.

Financial highlights

• Operating profit margin improved to -8.5%, a 4.5% increase from the previous quarter.

• EBITDA margin rose to 9.1% from 6.0% in 4Q24.

• Inventories increased by NT$400 million quarter-over-quarter due to early manufacturing ahead of integration.

• Cash inflows from operating activities despite operating loss; CapEx was NT$375 million.

• Inventory turnover days increased to 91 from 85 in 4Q24 and 83 in 1Q24.

Outlook and guidance

• Q2 outlook affected by tariffs and forex uncertainties, but direct U.S. shipments are minimal and forex risk is hedged.

• Cost control and focus on high-value-added products and strategic asset-light model to continue.

• Accelerated development in AI optical communications and automotive light sources planned.

• Company continues to focus on capital management, working capital, and investment planning for growth.

• Cash dividends of NT$0.9 per share approved for 2025, offsetting losses with capital surplus.