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Nam Tai Q3'07 Sales Up by 77.9% Year-on-Year
October 29, 2007 | PRNewswireEstimated reading time: 4 minutes
Nam Tai Electronic and Electrical Products Limited, a leading vertically-integrated manufacturing solutions provider of consumer electronics and communications products and software development, today announced the unaudited consolidated results of the Company and its subsidiaries (the "Group") for the third quarter and the nine months ended 30 September 2007.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />
For the third quarter of 2007, sales of the Group increased by 77.9% from US$50.7 million for the same period last year to US$90.3 million this year. The results were attributable to the increase in sales of all products. Gross profit for the third quarter of 2007 increased by 84.2% from US$9.0 million to US$16.5 million as compared with the same period last year. Operating income and profit attributable to the equity holders for the third quarter of 2007 increased by 99.5% and 86.8% respectively.
For the nine months ended 30 September 2007, sales of the Group increased by 70.4% from US$129.4 million to US$220.6 million when compared with the same period last year. For the same reasons as stated above, gross profit increased by 70.1% from US$22.8 million to US$38.8 million as compared with the same period last year. Operating income and profit attributable to the equity holders for the nine months ended 30 September 2007 also increased by 102.8% and 248.9% respectively as compared to the same period last year because of the overall increase in sales and the gain on the disposal of investments in TCL Corporation ("TCL Corp.") respectively.
The Group saw better sales for this quarter than other quarters of the year because customers ramped up orders in this quarter before Christmas and New Year holidays. However, because the fourth quarter is traditionally a low season, the financial results of the Group in the coming quarter will likely be affected.
The overall market conditions faced by the Group remain to be challenging. Additionally, the Group will also have to face issues such as the continuing appreciation of Renminbi, changing tax and labour laws of the People's Republic of <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />China, shortages of electricity supply and increases in overhead expenses resulting from inflation. It is expected that mobile phone accessories and home entertainment devices will continue to account for a large part of the turnover of the Group in the quarters to come.
Group Reorganization by Nam Tai Electronics, Inc. ("NTE Inc.")
On 8 October 2007, the Company announced jointly with J.I.C. Technology Company Limited ("JIC") that its parent company, Nam Tai Electronics, Inc. ("NTE Inc.") intends to reorganize the group structure of its subsidiaries (including the Company) in an effort to realize many of the same benefits that NTE Inc. hoped to achieve by its proposed privatization of the Company in 2005. The management of NTE Inc., the Company and JIC consider that a centralized management of all the manufacturing businesses with greater economies of scale would be beneficial to continued growth of the combined businesses as a whole. The reorganization is a good opportunity for the Company to achieve growth in the future by acquiring new and valuable business operations, diversifying its product range and customer base, having access to new industrial parks situated in Guangming, Shenzhen and Wuxi, Jiangsu (which offer better facilities but command lower costs), and acquiring higher precision and manufacturing technology which otherwise would not be available to the Company. Furthermore, the reorganization would transform the Company into a global EMS provider, making it the third largest EMS company listed on the Stock Exchange of Hong Kong Limited in terms of annual revenue (based on latest audited accounts). Details of the benefits of the Reorganization to the Company are set out in the aforesaid announcement.
This reorganization proposal requires the approval of the majority of the independent shareholders of the Company and JIC at their respective extraordinary general meeting which are scheduled to be held in November 2007. Circulars containing further details of the reorganization will be despatched to the shareholders of the Company and JIC as soon as possible in compliance with the requirements of the Listing Rules.
About NTEEP
Nam Tai Electronic & Electrical Products Limited, a subsidiary of Nam Tai Electronics, Inc. which is listed on the New York Stock Exchange (New York Stock Exchange symbol: NTE), is a well-established vertically integrated manufacturing solutions provider for some of the world's most reputable brand owners of consumer electronics and communications products including optical devices, home entertainment devices, mobile phone accessories and educational products. NTEEP is also a total solution provider offering a wide range of services on software development, data processing and compression and electronic hardware design and development specializing in digital dictionary and navigation system. NTEEP's largest customers include Sony Ericsson Mobile Communications AB, Texas Instruments Incorporated, Sony Computer Entertainment Europe Ltd. And GN Netcom A/S.
NTE Inc. is an electronics design and manufacturing service provider to many of the world's leading original equipment manufacturers, including Hikari Alphax Co., Ltd., GN Netcom, Sanyo Epson Imaging Devices (H.K.) Ltd., Sharp Corporation, Sony Computer Entertainment Europe Ltd., Sony Ericsson Mobile Communications AB, Sumitronics Hong Kong Ltd., Texas Instruments Incorporated, Uniden HK Ltd. and others. NTE Inc. manufactures high-quality telecommunications products, palm-sized PCs, personal digital assistants, linguistic products, calculators and components such as LCD modules, wireless communication terminals and their modules as well as CMOS sensor modules.
For more information about NTEEP, please visit its website at http://www.namtaieep.com . For more information about NTE Inc., please visit its website at http://www.namtai.com .