HONG KONG, Sept. 17, 2015 /PRNewswire/ --
Financial Highlights
| For the year ended 30 Jun |
|||
| HK$ |
2015 |
2014 |
Change (%) |
| Turnover |
381,355,419 |
308,905,915 |
+23.5% |
| Gross profit |
94,273,990 |
86,230,820 |
+9.3% |
| Gross profit margin |
24.7% |
27.9% |
-3.2 ppt |
| Net profit attributable to owners of the Company |
34,454,137 |
28,495,589 |
+20.9% |
| Net profit margin |
9.0% |
9.2% |
-0.2 ppt |
| Basic earnings per share |
0.13 |
0.10 |
+30.0% |
| Dividend (HK cents) |
2.3 |
5.0 |
-54.0% |
Huazhang Technology Holding Limited ("Huazhang" or the "Group", stock code: 1673) announced its annual results for the year ended 30 June 2015. The Group's turnover in the reporting period amounted to approximately HK$381,355,419 (2014: HK$308,905,915), representing an increase of approximately 23.5%. Net profit attributable to owners of the Company surged by 20.9% to HK$34,454,137 (2014: HK$28,495,589).
The Board of Directors declared a final dividend of 2.3 HK cents per share (2014: 5.0 HK cents). Total dividend for the year, including interim dividend and proposed final dividend, amounted to HK$13,815,000 (2014: HK$13,600,000), representing 40.1% of net profits for the year ended 30 June 2015.
Business Review
For the year ended 30 June 2015, the Group has entered into contracts (including industrial automation systems, sludge treatment product and after-sales service) with an amount of HK$342,177,000, as compared with last year, a decrease of 14.3%. As at 30 June 2015, the outstanding contracts amount was HK$264,910,000. Most of them were expected to be completed in the financial year ending 30 June 2016. With our Group strategic establishing the project division in 2014, effort to promotion of "design" "production" "service" business model. For the year ended 30 June 2015, "design" "production" "service" business model contributed a revenue amount of HK$158,005,000 to the Group.
As the paper industry in China is facing a difficult operating environment, the group has tried to expand into overseas markets. For the year ended 30 June 2015, the Group has entered into contracts with an amount of HK$25,223,000.
Industrial automation business
Revenue from sales of the Industrial Automation Business increased by approximately 38.2% to approximately HK$281,954,000, remaining the main income source of the Company. Such increase was primarily attributable to the provision of one-stop services in relation to industrial automation systems which includes sales of industrial automation systems, installation and testing services. The gross profit margin of the Industrial Automation Business decreased to approximately 22.6%. Such decrease is attributed to sales of industrial automation systems in a project with a lower gross profits margin. The Group accepted such a project for marketing purposes.
Sludge treatment products
Revenue from sales of sludge treatment products decreased 2.65% to approximately HK$63,948,000. Such decrease was primarily attributed to a decrease in project value and scale. The Group completed 190 contracts for the year ended 30 June 2015 as compared to only 127 contracts completed for the year ended 30 June 2014. The gross profit margin of our sludge treatment products is relatively stable at approximately 27.8%.
After-sale and other services
Revenue from provision of after-sales and other services decreased 9.7% to HK$35,453,000. Such decrease was primarily attributable to a reduced customer demand for keeping spare parts and components in advance of their use. The gross profit margin for provision of after-sales and other services increased to approximately 36.3%. Such increase is attributed to the improvement of gross profit margin of provisions for modification work services.
Prospects
Mr. Zhu Gen Rong, Chairman of Huazhang said, "For the PRC, the year 2015 is a year of reform. The PRC Government has reformulated its development strategies for the future, such as the "New Normal" for the PRC economy, "Made in China 2025", "One Belt, One Road" and "Ten Rules for Water Pollution Control and Management". For the paper industry, these policies indicate a faster elimination of obsolete capacity in the industry. Meanwhile, the existing production equipment and sewage treatment equipment require upgrades and modifications to meet the demand of the future development and the requirements of the policies. With over 10 years experience in equipment and service provision in the paper industry, I believe the experience in industrial automation systems as well as sludge treatment product design and actual operation can enable the Group's existing and potential customers to fulfill future development demand."
About Huazhang Technology Holding Limited
The Group is principally engaged in research and development, manufacture and sale of industry automation systems, sludge treatment products and corresponding services. The Group's industrial automation systems and sludge treatment products are custom-built in accordance with the specifications and requirements provided by the Group's customers. The Group is also engaged in the provision of after-sales and other services Group's existing customers.