Soundcard maker Creative Technology continues to rack up losses

Palm trees are seen outside the Creative Technology's headquarters in Singapore, on Monday, Jan 29, 2007. Creative Technology continued to rack up losses. For the third quarter ended March 31, the soundcard maker posted a net loss of US$8.8 mill
Palm trees are seen outside the Creative Technology's headquarters in Singapore, on Monday, Jan 29, 2007. Creative Technology continued to rack up losses. For the third quarter ended March 31, the soundcard maker posted a net loss of US$8.8 million (S$11.4 million), taking its loss for the first nine months to US$18.5 million. -- ST FILE PHOTO: JONATHAN DRAKE

Creative Technology continued to rack up losses. For the third quarter ended March 31, the soundcard maker posted a net loss of US$8.8 million (S$11.4 million), taking its loss for the first nine months to US$18.5 million.

In the same period last year, third quarter net loss was US$10.4 million but the company was profitable over the corresponding nine-month period.

But profit then was due mainly to a one-time licensing income of US$20 million and other gains of US$28.3 million.

Revenue for the three months to March 31 fell by 25.8 per cent to US$25.1 million, due to the uncertain and difficult market conditions which continued to affect the sales of the group's products.

Gross profit margin fell to 22 per cent from 25 per cent in the corresponding period last year, due mainly to write-down for inventory obsolescence for certain existing products following the introduction of new product models.

Loss per share narrowed to 12 US cents from 15 US cents previously while net asset value per share worsened to US$1.98 compared to US$2.32 as at June 30.

Looking ahead, Creative said a number of new products it introduced recently had been very well received.

"In particular, the reception to the Sound Blaster Roar, a high performance wireless portable speaker, which was launched recently, was very positive.

"These recently introduced new products provide good potential revenue growth opportunities for the group and are expected to contribute to revenue growth in the next financial year."

However, Creative expects no significant variations in revenue from the current levels and to report an operating loss for the coming quarter.

Creative shares were unchanged at $2.42 on Wednesday.