Hoya Q2 profit down on memory disks, LCD equipment

TOKYO, Oct 29 - Hoya Corp posted a 4.5 percent fall in quarterly operating profit, hit by sluggish sales of liquid crystal display-making equipment and a delay in the production of advanced glass disks used in hard disk drives. Hoya, which acquired digital camera and medical equipment maker Pentax Corp earlier this year, benefited from brisk sales of optical lenses for digital cameras and higher sales of glass used in the production of semiconductors.

But a delay in the production of hard disks with a so-called "perpendicular recording method" weighed on its quarterly earnings, while price competition hurt sales of glass used to make LCDs.

Operating profit at Hoya, which competes with Konica Minolta Holdings Inc in the hard disk substrate business, came to 26.85 billion yen in July-September, compared with a 28.13 billion yen profit a year earlier.

The result is roughly in line with Hoya's forecast for 26.36 billion yen. Merrill Lynch had estimated 26.5 billion yen.

Net profit slid 8.2 percent to 21.02 billion yen on sales of 100.98 billion yen, up 1.9 percent.

"One area in which we struggled a little was recording media, where we had some difficulty in the perpendicular method," Hoya Chief Financial Officer Kenji Ema told reporters on Monday.

Hard disks with a perpendicular recording method can hold more data than conventional disks.

"Optical lenses for mobile phones did not grow as much as we had thought, but we had stronger-than-expected orders for digital camera lenses, which are better business for us than cellphone lenses," Ema said.

"I think this trend will continue for a bit longer."

Hoya shares lost ground after the midafternoon announcement, ending down 1.9 percent at 4,150 yen, underperforming the Nikkei 225 share average , which gained 1.17 percent.

The company will not issue full-year forecasts until the end of the October-December fiscal third quarter.

Hoya said it now plans to absorb Pentax on March 31 next year, instead of making it a wholly owned subsidiary, to speed up its decision-making.

Pentax, which will be delisted from the Tokyo Stock Exchange on Nov. 30, said on Monday its quarterly operating profit more than doubled on strong sales of its digital cameras and medical endoscopes, which are used to examine internal organs.

Operating profit at Pentax, the world's fifth-largest maker of digital single-lens reflex cameras in 2006, came to 2.16 billion yen in July-September, up from 920 million yen a year earlier.

Digital SLR cameras, high-end models with interchangeable lenses, are the fastest-growing and most lucrative segment of the digital camera industry.

Following the announcement, shares in Pentax ended up 3.8 percent at 758 yen.

Hoya shares fell 8.8 percent in the year to Friday, while Pentax lost 2.7 percent over the same period and the Nikkei lost 4.2 percent.

source : yahoo