Alltronics Announces 2020 Interim Results

Aug 28, 2020 23:10 JST

Source: Alltronics Holdings Limited

Revenue Grows 13.7% to HK$722.8 million
Business Turnaround with Net Profit of HK$42.3 million
Interim Dividend at HK1.5 Cents per Share

HONG KONG, Aug 28, 2020 - (ACN Newswire) - Alltronics Holdings Limited ("Alltronics" or the "Group") (SEHK: 833), a leading electronic products manufacturer and a provider of energy-saving business solutions, has today announced its unaudited interim results for the six months ended 30 June 2020 ("1H2020", "first half of 2020" or "the Period").

During the Period, the Group's revenue increased by 13.7% to HK$722.8 million (1H2019: HK$635.7 million), mainly due to sales growth from the electronic products segment. Meanwhile, gross profit and gross profit margin rose to HK$147.3 million (1H2019: HK$100.3 million) and 20.4% (1H2019: 15.8%) respectively. The increase in overall gross profit margin was mainly due to the change in product mix and consistent efforts of the Group to tighten control over production costs and overheads, and to improve production efficiency. Profit for the Period attributable to owners of the parent was HK$42.3 million, compared to a loss of HK$16.8 million for the same period in 2019. The turnaround was mainly attributable to revenue growth of the Group's electronic product business segment during the Period and also without the impact of impairment loss recorded during the six months ended 30 June 2019.

Basic earnings per share were HK4.47 cents. In its appreciation for the shareholders' continuous support, the Board has declared the payment of an interim dividend of HK1.5 cents per share.

Business Review and Prospects

For the electronic products segment, total sales revenue comprises sales of finished electronic products, plastic moulds and components and other components for electronic products. During the Period, the global economy was adversely affected by the outbreak of COVID-19 pandemic. Though the production and sale revenue during the first quarter of the year were significantly affected by the pandemic, the manufacturing operation quickly resumed to normal during the second quarter and the demand from customers increased consistently, especially demand for the Group's electrostatic disinfectant sprayers.

Total sales revenue from electronic products increased by 14.0% to HK$721.0 million thanks to the growing demand of electrostatic disinfectant sprayers. Sales of electrostatic disinfectant sprayers surged to HK$144.5 million during the Period. Demand for the Group's irrigation controller products also remained stable with total sales of approximately HK$256.7 million. The Group is fully confident that the demand for both electrostatic disinfectant sprayers and irrigation controllers will remain strong and sales revenue from these products will dominate the income stream of the Group in the second half of the year. Furthermore, new products for customers in the PRC and in Europe are expected for launch so as to provide momentum for further revenue growth.

The operation of the biodiesel products and energy efficient gas stoves segment in Hong Kong was significantly impacted by the pandemic and total sales revenue was approximately HK$1.0 million (1H2019: HK$2.0 million). The Group expects the business of biodiesel products and energy-efficient gas stoves segment to remain stable during the second half of 2020.

Regarding the energy saving business segment, revenue during the Period was HK$0.8 million (1H2019: HK$1.1 million), mainly represented by energy saving revenue generated from the retail stores of Suning.com Co., Ltd. ("Suning"). With a view to focus more of its resources on the core manufacturing business, the Group has agreed with Suning to cease installation works at the retail stores of Suning. The discontinued installation works at Suning stores will not result in any significant impact on the overall operation and performance of the Group.

Looking ahead, the Group is cautiously optimistic towards the performance in the second half of 2020. In view of the ongoing trade disputes and escalating geopolitical tensions between the United States and the PRC as well as the lingering uncertainty due to the effects of various sanctions imposed or to be imposed on Hong Kong by the United States and other countries, the Group will strive to manage these factors and tighten control over production costs and overheads, and also improve production efficiency so as to maximise the gross profit margin.

Mr. Lam Yin Kee, Chairman of Alltronics concluded, "Although the economic and operating environment is fraught with uncertainties, the Group is confident that the overall performance of the electronic products segment, our major business segment, will perform much better in the year 2020, both in terms of sales revenue and profit. The Group will strive to capture the significant growth of demand in electrostatic disinfectant sprayers due to the pandemic. We will also continue to explore opportunities for new products and projects with our existing and potential customers in order to deliver strong performance and provide the best possible return for all our shareholders."

About Alltronics Holdings Limited (Stock code: 833)
Alltronics Holdings Limited is mainly engaged in the design and manufacture of a wide range of electronic products with quality and style, supplying biodiesel products and energy efficient gas stoves, as well as the provision of energy-saving business solutions. Besides, the Group is in the process of diversifying its business into manufacturing patented Wi-Fi Products and printers. The Company is a constituent stock of the Morgan Stanley Capital International ("MSCI") Hong Kong Micro Cap Index. For more information, please visit the company website http://www.alltronics.com.hk/.

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Source: Alltronics Holdings Limited
Sectors: Daily Finance, Daily News