Valuetronics' revenue, earnings stable in FY2015

VALUETRONICS Holdings on Tuesday posted a 0.9 per cent increase in net profit to HK$149.2 million (S$25.7 million) for its full year ended March 31, 2015.

Revenue of the electronics manufacturing services provider dipped 0.2 per cent to HK$2.4 billion.

This was due to its consumer electronics revenue falling on slower demand, despite industrial and commercial electronics' revenue rising on higher demand and a new customer.

Earnings per share fell to 40 HK cents, from 40.6 HK cents a year ago.

"In FY2015, Valuetronics continued to benefit from the strong performance in our industrial and commercial electronics segment, which mitigated the slowdown in the consumer electronics segment under the challenging business conditions ... Net profit margin remained stable despite rising cost pressure in China," the company said.

The board is recommending a final dividend of 16 HK cents per share and a special dividend of 4 HK cents per share for FY2015, amounting to about half the fiscal year's net profit.

Going forward, the company expects its customers in the consumer electronics segment to keep up their aggressive pricing strategies for mass market products, especially LED lighting.

"The extent of price reduction expected by some consumer electronics customers may erode our efforts on cost controls, improved operational efficiency and supply chain productivity, and will eventually affect our margins.

"However, Valuetronics will continue to leverage our integrated and scalable manufacturing capability, as well as expertise in LED lighting and home appliance products to strengthen our presence in the consumer electronics segment and hence, better manage our past dependence on LED lighting products.

"On the cost side, we foresee a continued increase in wages and staff related costs in China going forward. We will continue our efforts to manage costs, increase productivity and efficiency improvement," it said.