With the approach of the traditional third-quarter boom season, CMC Magnetic and Ritek, Taiwan's leading CD-R companies, are confident of improving their profitability. In fact, the two companies are believed to have a good chance of achieving life-time high sales in August. Both CMC and Ritek have predicted that their profits will begin to show faster growth in the third quarter. CMC predicted its third-quarter profits will reach NT$1.17 billion, representing 90 percent of its real profits of NT$1.3 billion made in the first six months of the year. (NT$34.57 = US$1). Ritek expects its profits to reach NT$1.42 billion in the third quarter alone, equivalent to 80 percent of its first half performance of NT$1.76 billion.
Similar predictions have been made by other leading CD-R companies. Prodisc Technology Inc. has raised its third-quarter profit forecast to NT$320 million, higher than the real profits of NT$235 million it achieved in the first half. Lead Data Inc. predicted profits of NT$90 million in the third quarter, almost reversing its heavy losses of NT$134 million in the first half. Despite earlier downgrading its financial projections, Gigastorage Corp. also expects that its profits will stage a strong rebound in the third quarter.
These encouraging third-quarter predictions come after sales picked up sharply in June and July. CMC and Ritek reported record high June and July sales, while Lead Data's sales hit life-time highs for three straight months between May and July. Prodisc also reported two months of second-highest sales in June and July, while sales of Gigastorage recorded their third-highest levels in June and July.
The approach of the traditional high season has raised hopes in the CD-R industry that sales will surge strongly by the year's end. CMC is confident that its August sales will exceed NT$1.8 billion, beating its record high marked in July. Ritek predicts that its August sales will challenge NT$2.3 billion to mark a new life-time high.