San’an Optoelectronics was undoubtedly one of main forces in last year’s price wars caused by public LED companies attempting to clear inventory, but this epi-wafer and chip maker has performed worse than any other on the secondary market for some time.

At the meantime of price cut, San’an has offered longer credit period to clients to clear inventory, which unavoidably resulted in increase of account receivable, coupled with growth in marketing expense. According to the company’s financial report for the third quarter of last year, compared with the beginning of the period, account receivable increased by 100% to RMB 707m; short-term borrowing rose by 178.79% to RMB 749m; and expenses of marketing and management grew by 101.47% and 46.11% year-over-year respectively.

Although San’an has not yet released business result forecast for full-year 2012, there is little chance to see satisfying achievement in the reporting period given previously-released financial figures and industry condition.