Aapico Hitech

Aapico Hitech Plc (AH)

Profit was 26% above our number
AH reported 1Q13 net earnings of Bt279m, up 193% YoY, but down 26% QoQ, due to lower revenue contributions from affiliates. The result beat our estimate and the Bloomberg consensus by 26%, due to better sales than modeled. 1Q13 earnings represent 32.7% of our FY13 projection.   
Results highlights
Sales rose by 51% YoY (but slipped 7% QoQ) to Bt4.5bn. The 1Q13 top-line expansion was enabled to greater capacity at AH’s main plant in Hitech Industrial Estate in order to supply rising demand among car makers for component parts to manufacture vehicles for both the domestic market and for export. Thus, its gross margin rose to 8.5% from 6.2% the previous quarter. Likewise, AH’s net margin jumped to 6.1% from 3.2% in the same period last year because of good OPEX management, mostly related to the new capacity and administration costs.
Outlook
We anticipate that the firm will deliver weaker QoQ core earnings for 2Q13 (the period has a lot more public holidays than the first-quarter).
What’s changed?
We maintain our FY13 earnings projection of Bt850m unchanged.