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SGX Mainboard listed Valuetronics Holdings Ltd, a design and manufacturing partner for the world's leading brands in the Consumer Electronics (CE) and Industrial and Commercial Electronics (ICE) sectors, has announced that its net profit for the financial year ended 31 March 2017 (FY2017) has increased by 27.9% to HK$154.1 million ($19.77 million) from HK$120.4 million ($15.45 million) from the financial year ended 31 March 2016 (FY2016).
"Our strong FY2017 results reflect a return to growth both in terms of our revenue and net profit. We are back on our path of growth, following our exit from mass market light bulbs in the third quarter of FY2016. Today, we have a widening product portfolio, especially with the smart lighting products with Internet-of-Things (IOT) features and our steadily growing automotive business, notably with another automaker of our existing customer in the process of qualifying us," commented Ricky Tse Chong Hing, Chairman and Managing Director of Valuetronics.
The Group's revenue grew by 16.5% from HK$1.95 billion in FY2016 to HK$2.27 billion in FY2017. Correspondingly, gross profit also increased by 14.9% to HK$341.7 million in FY2017 from HK$297.5 million in FY2016, with gross profit margin remaining stable at around 15% for FY2017.
In FY2017, CE segmental revenue increased by 19.7% from HK$824.6 million in FY2016 to HK$987.1 million in FY2017, mainly due to growth arising from the introduction of new products such as smart lighting products with IOT features.
ICE segmental revenue also increased by 14.1% from HK$1.128 billion in FY2016 to HK$1.288 billion in FY2017, mainly due to the increase in demand from some of the ICE customers.
As a result of the strong revenue growth, the Group's net profit for FY2017 increased by 27.9% to HK$154.1 million from HK$120.4 million in FY2016.
In FY2017, Valuetronics has recorded a strong performance across all segments. Following the exit of traditional mass market LED light bulbs in FY2016, the Group has refined the CE segment’s product portfolio to include smart lighting products with IOT features. Valuetronics remains optimistic on the growth prospects of these products as consumers start to adopt them for their homes.
The ICE segment continued its fourth consecutive year of double digital growth in FY2017. The strong growth was mainly driven by in-car connectivity modules used in automotive industry.
The Group acquired its first automotive customer in FY2016, and started supplying in-car connectivity modules to one of their automaker customers. Through this automotive customer, the Group is currently undergoing qualification by another automaker and approval is expected by late FY2018.
Both the smart lighting with IOT features and in-car connectivity modules are examples of increased mobile connectivity in day-to-day applications, in tandem with the global trend towards IOT. Moving forward, Valuetronics will ride on the opportunities presented by the confluence of technology under the emergent IOT trend in order to expand its product portfolio.
The Group will continue to strive for profitability growth and operational excellence in order to enhance shareholders value. However, like most manufacturers, Valuetronics is currently operating in an uncertain macro-economic environment, and continues to be mindful of possible business impacts, such as fluctuations in raw material price and procurement lead times. Barring unforeseen circumstances, the directors expect the Group to remain profitable in the coming financial year.
"This year is the 10th anniversary of our SGX listing, and I am happy to note that as a company, we are stronger, resilient, and ready today to pursue more opportunities for growth, especially with the emergent IOT trend," Tse concluded.
About Valuetronics Holdings Ltd
Valuetronics is an Electronic Manufacturing Service (“EMS”) provider, which focuses on the design and development of products that meet the ever-changing needs of customers. It is the preferred choice of several successful global companies that are involved in consumer electronics and industrial and commercial electronics products, with core competencies ranging from tool fabrication, injection moulding, metal stamping, machining, surface mount technology (“SMT”) and finished product assembly on full turnkey basis. Valuetronics’ EMS business is classified into two reportable segments namely consumer electronics products and industrial and commercial electronics products. Headquartered in Hong Kong, the Group’s main manufacturing facility is located in Long Shan 2nd Road, Western District of Science and Technology Park, Dayawan Economy and Technology Development District, Huizhou City, Guangdong Province, PRC. For more information, visit www.valuetronics.com.hk.