25 August 2010


Lextar’s revenue grows 82% in Q2, driven by LED backlighting

For second-quarter 2010, Lextar Electronics Corp of Hsinchu Science Park, Taiwan, a subsidiary of display panel maker AU Optronics (AUO) that manufactures high-brightness LED epiwafers, chips and packages, has reported revenue up 81.8% on last quarter to NT$2381m.

“Thanks to strong demand for LED backlights for large-sized LCD panels, our capacity was nearly fully loaded,” says chief financial officer B.Y. Chang.

The firm’s vertically integrated production model (from upstream epitaxy and midstream chip manufacturing to downstream packaging) and synergy from March’s merger of Hsinchu-based LED-making AUO affiliate LightHouse Technology have cut production costs and boosted gross margin to 28.7%, while operating margin was 21.8%. Net profit was NT$460m, tripling on last quarter.

Despite being faced with the rising cost of sapphire and other raw materials, the addition of new equipment has contributed to in-house chip production, Chang adds. Founded in May 2008, Lextar currently has over 50 MOCVD reactors, but it aims to introduce more new equipment in order to raise the percentage of in-house LED chips to 70%, boosting productivity. The firm expects its number of MOCVD reactors to rise to about 80 by year end (including 6-inch reactors planned for installation).

Lextar says that in future it aims to continue to evolve its product portfolio, expand into the LED lighting market, and develop new products for lighting applications. A fourth production site in Chunan, Taiwan due to start mass production in Q4/2010 (adding to existing plants in Hsinchu Science Park and the Hukou Industrial Park) is designated to be the lighting application production base, with production lines including SMT surface-mount technology and LED light module assembly. In addition, a plant currently under construction in Suzhou, China is scheduled to be equipped early next year and begin production in Q1/2011.

Lextar currently employs more than 2000 staff but, through establishing the new production plants, it expects to hire an extra 1800 new staff by the end of this year.

See related items:

LED-backlit panels to account for 30% of AUO's shipments for TVs in Q3

Taiwan’s LED production to surge 43% in 2010 to 26% of $9.6bn global output

LED industry entering fast growth stage in 2010

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