UPDATE 1-Syntax-Brillian sees Q2 revenue below Street; stock hit
(Adds details, share movement, comments from analyst and company)
BANGALORE Nov 28 (Reuters) - Syntax-Brillian Corp. BRLC.O forecast quarterly sales well below analysts' expectations as it changed its business model in China, sending shares of the television set and digital camera maker down 10 percent.
The Tempe, Arizona-based company said under the new plan it will stop shipping its Olevia brand LCD TVs to China and shift to a royalty-based business model.
The company said it will earn royalties based on sales of LCD TVs in China by a distributor, which will be responsible for sourcing components, manufacturing and selling them.
Syntax-Brillian, which also sells Vivitar digital cameras, said it expects $155 million to $175 million in sales for the second quarter. Analysts are expecting revenue of $299.9 million, according to Reuters Estimates.
For 2008, the company forecast revenue of $650 million to $685 million, including Vivitar global sales and excluding sales made through its licensed China-based distributor.
Analysts expect $852.4 million.
Assuming that sales made through its China-based distributor were made directly by the company, its LCD TV revenue would have been $1.1 billion to $1.3 billion, Syntax-Brillian said in a statement.
Canaccord Adams analyst Jonathan Dorsheimer said the outlook was disappointing and that he was uncertain how the company will be able to collect the royalties. China accounts for about 30 percent to 40 percent of sales, he said by phone. Continuación...