Creative Tech Posts 3rd-Quarter Profit of $15.2 Mln (Update7)
By Greg Chang
quote.bloomberg.com
Singapore, April 23 (Bloomberg) -- Creative Technology Ltd., the world's largest maker of sound cards for personal computers, had a better-than-expected fiscal third-quarter profit as it cut costs and focused on selling its Sound Blaster products. The company's stock rose as much as 4.3 percent.
Net income was $15.2 million, or 20 cents a share, in the three months ended March 31, compared with a loss of $101 million, or $1.27, in the year-earlier period. Revenue fell 26 percent to $193.4 million from $262.0 million.
Creative Technology has been scaling back sales of low-profit product lines such as CD-ROM drives to focus on its computer speakers and Sound Blaster Audigy and Extigy cards, which enhance audio in personal computers. Gross margin, a measure of profitability, rose to 33 percent from 24 percent a year ago.
``They have really focused on their core audio products and it's obviously paying off,'' said Jamie Doyle, who helps manage $1.6 billion at Causeway Capital Management, including Creative shares. ``I am very happy to see revenue decline once you see they've dropped all these products, and they're making up for it on the margins side.'' |
