SINGAPORE (Aug 1): Hi-P International reported a 16.9% increase in earnings to $14.4 million for the 2Q19 ended June, from $12.3 million a year ago, on the back of higher profit margins.

The global contract manufacturer of smart phones, tablet computers and other consumer electronics saw its earnings per share (EPS) rise 17.8% to 1.79 cents in 2Q19, from 1.52 cents in 2Q18.

2Q19 revenue fell 5.2% to $286.4 million, from $302.0 million a year ago.

The decline was primarily due to the deconsolidation of the group's flexible printed circuit board (FPCB) business unit upon the dilution of interest in Hi-Flex (Suzhou) Electronics Co. in 4Q18, as well as price pressure and lower sales volume for certain customers.

However, gross profit jumped 34.1% to $39.8 million in 2Q19, as gross profit margin rose 4.1 percentage points to 13.9%.

The improvement was driven by a change in product mix, better cost management, and more effective spending on new product introduction.

As at end June, cash and cash equivalents stood at $248.9 million.

“Within Hi-P, we have been working aggressively on growth transformation and it has yielded some positive results, as evident by our 2Q19 financials. However, we have yet to realise our full potential in light of the group’s transformation roadmap,” says Yao Hsiao Tung, Hi-P’s executive chairman and CEO.

“To reduce the impact of trade war, we have initiated new projects in Thailand and worked on some plans out of China to cope with customers’ business demand. In the meantime, we have also fought diligently for non-US related business to fill our operations in China,” he adds.

Shares in Hi-P closed 1 cent lower at $1.38 on Thursday before the results announcement.