Altek wins contract orders for digital cameras from Kodak, HP

Taipei, Nov. 26, 2004 (CENS)--Altek Corp., a leading digital camera maker in Taiwan, has recently won big-ticket contract orders from Kodak and HP for high-level digital camera models, making the firm project annual shipment of up to four million cameras next year.

Altek delivered 2.4 million digital cameras in the first three quarters this year and expects to ship additional 800,000 units this quarter. But the firm's total annual shipment this year may fall short of the company's original annual goal of four million units. The company will start delivering high-level cameras to HP and Kodak early next year.

Statistics compiled by ITC of the U.S. showed that Kodak and HP accounted for 12% and 5% of the global digital-camera market, respectively, last year, ranking No. 4 and No. 7. Last year's top-three suppliers were Sony, Canon and Olympus.

Lee Yue-hwa, an industry analyst at the Institute for Information Industry, pointed out that Japanese digital-camera brands would keep occupying the top-three positions this year and next, while American brands such as HP and Kodak would see sales growth and global ranking drop.

Altek expects to have revenue of about NT$600 million (US$18.46 million) for November, down 8% from October and plunging 55% from one year earlier. The company accumulated pretax earnings of NT$280 million (US$8.62 million) for the first three quarters, attaining only 53% of its annual profit goal.

Industry sources said that the global digital-camera market greatly expanded to an unprecedented sales volume and attracted a group of companies, especially in Taiwan and Japan, to jump into the line or expand their capacities. The global demand in this year, however, cooled down rapidly and the profit margins for such products slide down sharply. Altek, for example, had a net margin of only 6.49% with its products in the third quarter, compared with still 12.88% in the first quarter of last year.

Many digital camera makers in Taiwan have been trying to upgrade their self-content ratios in a bid to improve profitability, but the technologies for the most-important parts, including charge coupling device (CCD) sensor and optical lens, are still controlled by big Japanese companies.

Taiwan's digital camera maker originally expected that the sliding camera prices would force Japanese brands to release more contract orders but the hopes broke finally as many leading Japanese brands have been continuously elevating their self-production ratios.

According to III, global shipment of digital cameras is expected to reach 60 million units this year, up 24% from last year. And the figure is anticipated to expand 18% to 70 million units next year.