REPORTS TURNOVER GROWTH OF 16.3% TO
(Hong Kong, October 13, 2004) -- Leading Hong Kong plastic resins and specialty colourants supplier Ngai Hing Hong Company Limited and its subsidiaries (the ¡§Group¡¨) (Stock code: 1047) today announced its annual results for the year ended June 30, 2004.
year under review, the Group recorded a turnover of HK$1,017,775,000 (2003:
HK$874,976,000), representing a growth of 16.3% over that of the corresponding
period last year. Profit attributable to shareholders amounted to HK$13,279,000
(2003: HK$40,462,000). Earnings per share for the period amounted to HK 4.43
cents (2003: HK 13.49 cents). The Board has recommended an annual dividend of HK
2.0 cents per share (2003: HK 5.0 cents). Including the interim dividend of HK
1.0 cent per share, the total dividend payment for the year under review will
amount to HK 3.0 cents (2003: HK 8.0 cents) per share.
Mr. Hui Sai Chung, Chairman of Ngai Hing Hong, said, ¡§This is the 10th anniversary of our listing in Hong Kong and we achieved a turnover exceeding the HK$1 billion threshold despite that it had been a challenging year. We managed to turn the many challenges posed by the difficult business environment in Asia into opportunities to grow our business.¡¨
Through implementing aggressive sales and marketing strategies, the Group secured a broadened customer base and achieved significant growth in both orders and sales prices, which increased its consolidated turnover by 16.3% over that of the previous year. In addition, the Group succeeded in expanding into a new business - the manufacture and sale of PVC compounds. In May 2004, the Group¡¦s new plant in Dongguan commenced operation to provide to both the domestic and overseas markets PVC compounds for the production of electrical wires and cables, sockets and toys.
Mr. Hui continued, ¡§This year, we are happy to see our successful expansion into the new PVC business. We have received encouraging responses from both domestic and overseas customers to our PVC compounds products and are confident that this new business will emerge as a strong future growth driver and start contributing profits to the Group in the coming financial year.¡¨
Strong market demand for engineering plastics and the Group¡¦s stringent product quality control further boosting customer demand for its products explained the outstanding performance of its high margin engineering plastics manufacturing business. Persistent turnover growth was recorded for this segment. As for the colourants business, the Group also secured many new customers and recorded steady turnover growth thanks to the keen market appetite for the film grade masterbatches.
With regard to the Group¡¦s plastic trading business, Ngai Hing (GZFTZ) Trading Co., Ltd. ("NHGZ") in Guangzhou reported satisfactory performance with significant growth in turnover. On top of actual financial returns, NHGZ signifies the Group¡¦s determination to penetrate into the PRC and to enhance a long-term development in the market.
However, the surge of crude oil prices and the extra resources deployed into the new Dongguan plant and the new PVC business increased the Group¡¦s production and operating costs. Overall profit margin narrowed. Nonetheless, the Group has full confidence that the return from the new business will be reflected in the results of the coming financial year. Besides, the Group has established new plants in Shanghai and Hong Kong, and a new office in Xiamen, which expanded its production capacity and sales network. These endeavors are expected to generate even more revenues to the Group in the coming year.
To assure steady business growth in the future, the Group is committed to enhancing its R&D efforts and has scheduled to set up a new R&D center in Shanghai by 2005, in addition to recruiting professionals to assist the development of innovative products. The Group is also dedicated to providing customers with the highest quality products and premium value-added services, which will help to strengthen its competitiveness in the market and in return, expand its income sources.
Mr. Hui concluded, ¡§Looking ahead, seeing the vast growth potential of the burgeoning PRC market and economy, we will strive to fully exploit our resources in Guangzhou and Shanghai to further expand our business in the PRC market. With our promising new PVC business and our new plant progressing into full operation, we expect to see the Group¡¦s income base broaden, thus bumping up our overall results next year and bringing even better returns to our shareholders.¡¨
Ngai Hing Hong provides a total solution to plastic products manufacturers with services and products ranging from plastic resin (including polymers Ngai Hing Hong provides a total solution to plastic products manufacturers with services and products ranging from plastic resins (including polymers and engineering plastics) selection, complementary computerised colour matching services, on the spot technical advice, to the supply of custom-made plastic colourants, engineering plastics and PVC compounds for the plastics industry.