(Adds details, analyst comments, CEO comments from)
By Lehar Maan
Aug 4 Solar and LED equipment maker GT Advanced
Technologies Inc raised the lower end of its full-year
2014 adjusted profit forecast, citing higher gross margins for
the second half of the year.
Shares of the company, which reported second-quarter results
below analysts' estimates, were up 12 percent in extended
trading at $15.84.
"They made a deal with Apple in December and there was
speculation that the deliveries might be significantly delayed,"
Gilford Securities analyst Nimal Vallipuram said.
"It looks like there is no significant change in their
relationship with Apple."
Apple said in November last year that it will open a
manufacturing facility in Arizona in partnership with GT
Advanced to make sapphire materials for its popular electronics
Sapphire glass, which is slightly less hard to diamond,
could make Apple's products scratch resistant and nearly
unbreakable making it ideal for smartphone displays.
"We have continued to see strong interest in our suite of
sapphire production tools," Tom Gutierrez Chief Executive of GT
Advanced said in a statement.
He added that the sapphire business accounted for 75 percent
of the company's total revenue during the quarter, with a larger
part of it coming from the sale of sapphire production
"Sapphire material sales to Apple have low gross margins so
if you reduce that then equipment sales has higher gross margin,
and they (GT Advanced) are seeing pretty high demand for
sapphire equipment," Pacific Crest Securities analyst Weston
The company also said it expects to meet certain operational
targets and receive the final $139 million prepayment from Apple
by the end of October 2014.
GT Advanced on Monday raised the lower end of its full-year
profit forecast to 12-18 cents per share, up from the previous
range of 2-18 cents. The revised forecast handily beat average
analysts' expectation of 3 cents per share, according to Thomson
However, the company cut the top end of its revenue forecast
by $100 million It now expects revenue to range between $600
million and $700 million for the year.
The company reported a bigger-than-expected loss and lower
revenue for the second-quarter ended June 28, 2014.
The company reported a net loss of $86.4 million, or 63
cents per share, compared with a profit of $11.9 million, or 10
cents per share, a year earlier.
On an adjusted basis the company reported a loss of 16 cents
Revenue fell more than half to $58.0 million from $168.3
million a year earlier.
Analysts were expecting a loss of 14 cents per share on
revenue of $63.9 million.
GT Advanced's shares closed at $14.12 on the Nasdaq on
(Reporting By Aurindom Mukherjee in Bangalore; Editing by
Sriraj Kalluvila and Anil D'Silva)