Revenues disappoint a fraction, but profit really explode…
* Q1 EPS 45 cents beats est by 11 cents
* Q1 sales $109.4 mln vs est $111.1 mln
* Sees Q2 EPS $0.27 to $0.32 vs est of $0.29
May 15 (Reuters) – Chinese jewelry maker Fuqi International Inc (FUQI.O) posted a better-than-expected quarterly profit, driven by higher gross profit margin, and raised its 2009 earnings forecast.
For the first quarter, the company, whose design database includes items made from platinum, gold, karat gold, diamonds and other precious metals and stones, said net income jumped 52 percent to $9.7 million, or 45 cents a share.
Revenue at the company, which sells its products directly to distributors, retailers and other wholesalers, surged 41 percent to $109.4 million, helped by strength in its wholesale and retail businesses.
Analysts on average expected a profit of 34 cents a share, before special items, on revenue of $111.1 million, according to Reuters Estimates.
Gross profit rose 510 basis points to 16.5 percent.
“We are focusing our efforts to drive the continued growth of our retail business and we believe the traditionally larger margins will have an increasingly significant impact on our profitability as our retail business continues to grow,” Chief Executive Yu Kwai Chong said in a statement.
Looking ahead, the company expects full year 2009 earnings of $1.49 to $1.63 a share, up from its prior view of $1.35 to $1.41.
However, the company forecast second-quarter revenue of about $89.5 million to $93.5 million, which fell short of analysts’ consensus estimate of $95.7 million.
Shares of the Shenzhen, China-based company closed at $6.49 Thursday on Nasdaq. (Reporting by Poojya Trivedi in Bangalore; Editing by Deepak Kannan)
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We would say that $1.5 at least in net profits per share for the year 2009, with growth at 40-50%, this company is really cheap. It had a major slump the last couple of days and we started to worry the earnings might be disappointing. They’re nothing of the sort.