Tripod Technology Corporation Increased Revenue by 5%-10% in Q3 with the Impact of the Increase of RMB and Growth of Wages in Mainland China

With sound finances and a stable growth of profits and cash dividends, the Tripod Technology Corporation (Tripod), a PCB manufacturer, has always been favored by foreign investors. Looking toward the boom season, Tripod expects to increase its revenue by 5-10% in the third quarter. An increase in business activities has contributed to a positive gross profit margin, while negative impacts, including the increase in RMB and growth minimum wage in mainland China of July, require further observation.

Looking to the third quarter, a boom season, smart phone markets such as HDI will see an increase in demand. Focusing on Chinese and Korean brands, Tripod has started launching new smart phones. As a supplier of top American brands, Tripod also supplies PCBs for smart phones and other products. It is estimated that the revenue of Tripod will increase by 5%-10% in Q3 2017.

In terms of the gross profit margin, Tripod’s revenue in the second quarter increased by 3.41%. Due to the increase in business activities and the relief of the increasing cost of raw materials, gross profit in the second quarter is expected to increase by 17.22% compared to the previous quarter. Looking toward the third quarter, business activities is expected to reach 90%, which will cause a further increase in the gross margin. However, the increase in RMB and growth of minimum wage that impacted Tripod Wuxi on July 1^st are negative factors in terms of Q3 2017 profit.

In terms of new capacity, Tripod originally planned to increase the capacity of multi-layer rigid boards in the Xiantao Plant in Hubei by 0.2-0.4 million feet/month this year. However, Tripod intends to expand by 0.6 million feet at a time to meet order demands. The expansion of capacity next year is also set at 0.6 million feet. (Source: MoneyDJ - Focus News)