M-Flex Shares Sink on Tempered Revenue OutlookThursday, July 7, 2011
Shares of Anaheim’s Multi-Fineline Electronix Inc. dropped sharpy in afterhours trading Thursday after the company cut its sales outlook for the June quarter.
Multi-Fineline, which makes flexible printed circuit boards for cell phones and other mobile devices, saw shares sink more than 11% in extended trading to a market value around $523 million.
The company, commonly referred to as M-Flex, cut its sales projection for the June quarter to about $191 million, down from prior guidance of $200 million to $220 million and a gross margin of 12% to 13%.
Analysts were expecting revenue of about $210 million.
The tempered outlook stems form a drop in demand from a “key” customer late last month, according to M-Flex Chief Executive Reza Meshgin.
M-Flex doesn’t disclose customers, although Apple Inc. and Research in Motion Ltd., the maker of Blackberry phones, are known to use the company’s circuit boards.
The company’s circuit boards are flexible, which makes them easier to design into phones, barcode scanners and other devices.
Higher seasonal demand is projected to increase sales in the September quarter, Meshgin said.
M-Flex is part of Singapore’s WBL Corp., a holding company that operates technology and other businesses. WBL owns 62% of M-Flex’s publicly traded shares and a third of the company’s voting stock.
The company once produced much of its circuit boards at its Anaheim headquarters, which still does prototypes and more complex jobs. Most of the rest of production has shifted to China in the last several years.
The company got its start in Anaheim in 1984. A decade later, it opened its first China plant in Suzhou. A second China plant followed in 2003.
M-Flex went public in 2004.