omniture

Tonly Electronics' Profit Rises 13.6% to HK$128.3 Million for the First Three Quarters of 2015

Gross Profit Margin Widens to 13.4%
Fully Implement "Transformation and Entrepreneurship" Strategy
Actively Develop Media Boxes and New Audio Products Businesses

HONG KONG, Oct. 19, 2015 /PRNewswire/ -- 

Results Highlights (For the Nine Months Ended 30 September 2015)

  • Turnover was approximately HK$3,667.8 million, representing a decrease of 8.6% year-on-year ("yoy").

Business segment

Revenue

(HK$ million)

Yoy change

 (%)

Audio products

1,697.7

+13.5%

Video disc players

1,089.7

-31.3%

Media box products

600.9

+20.2%

Other products (mainly ABS-s)

279.5

-35.0%

  • Enhanced production efficiency yielded results. Gross profit margin increased from 12.5% in the same period last year to 13.4%.
  • Operating profit rose by 4.1% yoy to approximately HK$151.0 million. Profit attributable to owners of the parent climbed by 13.6% yoy to approximately HK$128.3 million.
  • The Group won the bid for the Inner Mongolia Autonomous Region's Advanced Broadcasting System-Satellite ("ABS-s") "Hu Hu Tong" and the "2015 Digital Wireless Coverage Project for Central Radio and TV Programmes" satellite signal receiving device project.
  • The Group's first proprietary high-end noise-canceling wireless headphone developed for an internationally renowned consumer electronics brand started commercial shipment in September 2015. It is expected to gradually become a significant revenue source of the Group.

Tonly Electronics Holdings Limited ("Tonly Electronics" or "the Group"; SEHK stock code: 01249) today announced its unaudited results for the nine months ended 30 September 2015.

In face of China's continued economic slowdown and volatilities in the global economy, the Group's turnover during the period under review recorded a decline of 8.6% yoy to approximately HK$3,667.8 million. Gross profit margin increased from 12.5% in the same period last year to 13.4%. Operating profit rose by 4.1% yoy to approximately HK$151.0 million, while profit attributable to owners of the parent grew by 13.6% yoy to approximately HK$128.3 million. Net profit margin was 3.6%.

During the period under review, sales of audio products achieved encouraging growth with revenue growing from HK$1,495.7 million in the same period last year to HK$1,697.7 million, representing an increase of 13.5% yoy, mainly attributable to the growing popularity of Internet and wireless technologies, as well as substantial market demand for new types of audio accessory products for smartphones and television sets.

The market demand for traditional DVD players continues to shrink with the growing popularity of tablet PCs and smartphones applications. The Group has leveraged on its years of accumulated technology R&D, production capability, good supply chain and strong client relationships to maintain a leading position in the industry, however, it still fell behind the pace of the diminishing market. At the same time, due to the changes in customer's purchasing strategy, the related branded video disc player business recorded significant decline as a result. Revenue from the Group's video disc player decreased by 31.3% yoy to HK$1,089.7 million in the period under review.

The Group successfully established cooperation relationships with foreign and domestic internet and telecommunications companies, contributing to steady growth in the media box business. Revenue from the Group's media box business in the first nine months of 2015 rose 20.2% yoy to HK$600.9 million. In the first half of 2015, the Group rebuilt its overseas set top box ("STB") business team to develop more diversified products and further expand the media boxes business.

In the period under review, sales of ABS-s products generated revenue of HK$129.2 million, a decrease of 49.5% yoy, mainly due to the decrease in governmental ABS-s tendering projects. However, sales of ABS-s products are expected to benefit from the Central Government's gradual opening of the ABS-s retail market.

In terms of production and supply chain management, the Group is committed to enhancing its human resources system. On top of this, the Group has established home theater system ("HTS") and DVD production lines in its factory in Indonesia which procured some of the raw materials locally and acquired new customers, thus boosting the shipments substantially during the reporting period. The Group has also strived for product innovation and design, with substantial investment in R&D. During the period under review, the Group's R&D expenses were approximately HK$146.1 million, representing 4.0% of its total revenue.

The Group's first proprietary high-end noise-canceling wireless headphone started commercial shipment in September 2015. This headphone combines active noise-canceling, Bluetooth transmission and touch control technologies. The Group transformed the initial design concept into a viable product and released to the reputable client in only ten months, which earned customer's trust and recognition.

In September 2015, the Group won the bid for the Inner Mongolia Autonomous Region's ABS-s "Hu Hu Tong" project through its wholly-owned subsidiary, with a bid amount of approximately RMB26.7 million. Since 2012, the Group has full coverage of ten service areas in Inner Mongolia Autonomous Regions. Over the same period, the Group also won the bid for the "2015 Digital Wireless Coverage Project for Central Radio and TV Programmes" satellite signal receiving device project, with an amount of approximately RMB16.0 million. This marks Tonly Electronics' formal entry into the high-tech front-end wireless coverage device sector.

The management of Tonly Electronics stated "The future trend of the market is dominated by the Internet and wireless technology. Demand for smart home appliances and tablet PCs continuing to grow, while the associated new audio products will also prevail. The Group will continue to strengthen its development capabilities in product design and core technologies, and adhere to focus on product innovation as its expansion strategy. It will introduce more innovative products to meet market demands and consumer preferences. The Group is committed to creating new growth opportunities by optimising its product portfolio, further expanding its customer base and strengthening partnerships with strategic clients. At the same time, it will deepen cooperation with both domestic and overseas internet and telecommunications companies to promote the development of its media box business. In addition, the Group will continue to look for opportunities, both organically and through acquisitions, to expand into new business areas, diversify service offering and revenue stream, with an ultimate goal of maximising value for the Group and its shareholders."

The Group's revenue breakdown by product:


2015 Q1-Q3

2014 Q1-Q3

Change


(HK$'000)

(HK$'000)


Audio products




-Traditional audio products(1)

730,326

819,513

-10.9%

-New audio products(2)

967,368

676,150

+43.1%

Subtotal

1,697,694

1,495,663

+13.5%





Video disc players(3)

1,089,714

1,586,546

-31.3%





Media boxes(4)

600,911

499,747

+20.2%





Other businesses




-ABS-s products

129,155

255,831

-49.5%

-Components

115,182

118,906

-3.1%

-R&D income

35,151

55,540

-36.7%

Subtotal

279,488

430,277

-35.0%





Total

3,667,807

4,012,233

-8.6%

 (1)Mainly include HTS and Micro & Mini speakers

(2)Mainly include wireless speakers, soundbars, audio docks and headphones

(3)Mainly include DVD players and BD players

(4)Mainly include OTT (over-the-top) Internet services and content set up box (STB)

About Tonly Electronics

Tonly Electronics Holdings Limited (stock code: 01249) is an internationally leading audio-visual ("AV") products manufacturer, and is principally engaged in the research and development, manufacturing and sales of audio-visual products and wireless intelligent interconnectivity products on an ODM basis. Tonly Electronics is also one of the ABS-s manufacturers under the programmes of "Hu Hu Tong" and "Cun Cun Tong" initiated by The State Administration of Radio, Film, and Television ("SARFT"). The company will establish the most competitive New ODM industry platform based on acoustic and wireless internet technology. Its ultimate controlling shareholder is TCL Corporation (a company listed on the Shenzhen Stock Exchange, Stock code 000100.SZ).

For more information, please visit its website at www.tonlyele.com.

Source: Tonly Electronics Holdings Limited
Related Stocks:
HongKong:1249
Related Links:
collection