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EIH Expects Sales To Rebound In 2Q18

May 24, 2018

E Ink Holdings (EIH) expects its sales to rebound in the second quarter of 2018 from the weak results in the first quarter, with full-year results to increase compared to 2017, according to company president Johnson Lee.

EIH posted revenues of NT$2.898 billion (US$96.81 million) in the first quarter of 2018, down 17.3% on quarter and 10% on year.

While first-quarter net profits reached NT$41 million or NT$0.04 per share, the company actually posted an operating loss of NT$264 million in the January-March period, compared to an operating profit of NT$45 million a year earlier.

Foreign exchange transaction losses and slower sales of e-book reader solutions caused by production transition at clients contributed to the operating losses in the first quarter, Lee explained.

The company also saw its gross margin dip to 38.3% in the first quarter compared to 42.1% a quarter earlier and 38.7% a year earlier.

However, the company expects sales of its electronic shelf label (ESL) products to continue to gain momentum through 2018, buoyed by fast-developing smart retailing business models and the company's ability to offer multiple ESL devices, Lee said.

In addition to black and white ESLs, EIH currently also offers 3-colored ESLs, low-temperature ESLs as well as low-voltage ESL products.

Although sales of e-book reader solutions were slow in the first quarter, Lee noted that EIH is cooperating with clients to develop large-size e-paper displays from 6-inch onward, with the ratio of large-size solutions to increase significantly in 2018.

Sales of display solutions for e-notebooks will also serve as a growth driver of the company in 2018, Lee said, adding that EIH will push sales of e-notebook solutions with hand-writing and touch capabilities to the professional, commercial and education sectors.