SHENZHEN -- Nam Tai Electronics reported third-quarter sales fell 31.2% to $110.4 million on slower demand for consumer electronics and telecom equipment.

Net income was $4.5 million, down 8.2% from last year.

Consumer electronics sales fell 57.3% during the period, while telecom sales were down 14.8% and and LCD panels were off 7.6%, respectively, compared to same period in 2008. 

"The business environment remains difficult and extremely competitive," the company said.

For the quarter, gross profit was $12.6 million, down 19.9%. Gross profit margin was 11.4%, up from 9.8% in 2008. Non-GAAP operating income was $4.8 million, up from $4.4 million a year ago. Cash from operations was $4.8 million during the quarter. 

As of Sept. 30, Nam Tai had $189.6 million in cash on hand.

Expansion of an FPC manufacturing plant in Wuxi was largely completed in the second quarter third quarter, and manufacturing equipment was set up and human resources recruited to operate the plant during the September period. Mass production is expected to begin in the fourth quarter. 

Nam Tai is expecting a slow recovery, calling the recent "surge" seasonal. "In fear of overstocking, the market will be cautious and is expected to return to a weaker demand position in the fourth quarter." Nam Tai expects to make up for its first-quarter losses by year-end. The firm expects the recovery rate at the turn of 2010 to be slow, with a recovery in in the third quarter of 2010.

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