Affected by the cost and price of LED lighting industry profits shrink

From the recent LED listed companies have released the 2011 semi annual report, the majority of the company products in the first half net interest rates decline, the semi annual report of some enterprises also showed that although its operating income increased, but the net profit decline has reached nearly two to 30%.

In the first half of 2011, the gross profit margin of packaging companies compared to the same period last year fell more obvious, mainly due to lower prices of LED devices and raw material prices. In addition, some export enterprises, the appreciation of the renminbi has also affected the gross margin of export products.

Overall, the higher operating costs and product prices are the main reason of LED company profit growth is weak, coupled with the first half of this year LED backlight market demand as expected, the factory will have shifted the focus of the LED lighting market, if sustained development of this situation, product prices are likely to continue to decline, the industry reshuffle and the "price competition" also can hardly be avoided or will. In packaging enterprises, seen from a large package of enterprises in the annual report: the company's main business gross margin was 22.80%, down 9.82 percentage points over the same period last year, the main reason is: SMDLED to expand product market share, the company take the initiative to reduce the price of products, a substantial increase in sales, gross margin fell 15.40 percentage points.

In the main raw material procurement prices and product sales price decline in the environment, there are some companies to adjust the product structure in a timely manner, to achieve a profit contrarian rise. Such as REFOND first half net profit growth of 25%, the main reason can be attributed to the lighting and focus on developing LED in large size LCD backlight LED market, especially the gross margin of 61.20% year-on-year growth of 49.93% LED automotive applications. In addition, the semi annual report shows honglitronic: during the reporting period, the company net profit growth of 26.10% over the previous year. The LAMPLED gross margin fell 7.2%, the product is mainly affected by market competition sales price decreased; SMDLED and LED application products operating income grew by 49.98% and 48.48% respectively, mainly due to sales expansion due.

In view of this, the enterprise only according to market trends, timely adjust and optimize the product structure, improve product quality and performance, and timely expansion of production capacity, and to explore more cost advantage of the production process, in order to get more active in the next round of competition in the market, which is undoubtedly the enterprise managers put forward higher requirements and new challenges.