SINGAPORE and HONG KONG, Feb. 27, 2013 /PRNewswire/ --
Financial Highlights
| (RMB' mil) | FY2012 | FY2011 | Change % |
| Revenue | 869.5 | 1,080.7 | (19.5) |
| Gross profit | 251.3 | 362.0 | (30.6) |
| Share of (losses)/profits of an associate | (5.7) | 8.3 | N.M.* |
| Profit before tax | 43.8 | 225.5 | (80.6) |
| Profit attributable to equity holders | 27.8 | 187.4 | (85.1) |
* Not Meaningful
Midas Holdings Limited ("Midas" or the "Company", together with its subsidiaries, the "Group"; SGX-ST stock code: 5EN; SEHK stock code: 1021) reported profit attributable to equity holders ("net profit") of RMB 27.8 million on the back of group revenue of RMB869.5 million for the full year ended December 31, 2012 ("FY2012").
The Group's core Aluminium Alloy Extruded Products Division, which accounted for 95.4% of group revenue in FY2012, registered a 20.2% decrease in contributions to RMB829.6 million. Within this division, the Transport Industry remained the largest revenue contributor, accounting for 57.1% of its revenue, whilst the Power Industry took up 7.4%. The "Others" segment, comprising mainly the supply of aluminium alloy rods and other specialised profiles for industrial machinery, contributed the remaining 35.5%.
Mr Patrick Chew, Chief Executive Officer of Midas, said, "Our performance in FY2012 should be seen against the backdrop of a sector slowdown in late 2011 and 2012. In view of these challenges, we proactively identified new business opportunities and successfully secured a series of new orders, from both overseas and domestic customers during the year."
The Group's gross profit decreased to RMB251.3 million in FY2012, from RMB362.0 million in FY2011. Correspondingly, gross profit margin for FY2012 was 28.9%, a decrease from 33.5% in FY2011. In line with the slower business activity for the year, resulting in higher per unit production cost, gross profit margin at the Aluminium Alloy Extruded Products Division decreased to 29.4%, from 34.2% in FY2011.
Selling and distribution expenses remained fairly stable at RMB40.4 million in FY2012, compared to RMB40.3 million in FY2011. As a result of higher amortisation, depreciation, travelling and utilities expenses, administrative expenses rose 21.6% to RMB100.0 million in FY2012.
Finance costs rose 90.8% to RMB74.0 million in FY2012, mainly due to higher bank borrowings. Approximately RMB25.9 million (FY2011: RMB25.4 million) of the interest on bank borrowings that were used to finance the construction of property, plant and equipment for the new production lines were capitalised.
As a result of fewer train car deliveries during the year, which was partially offset by recovery of expenses, the Group's share of loss from its associated company Nanjing SR Puzhen Rail Transport Co., Ltd ("NPRT") was approximately RMB5.7 million in FY2012.
Notwithstanding the challenges, the Group was able to turn in a net profit of RMB27.8 million for FY2012, which compares to a profit of RMB187.4 million for FY2011. Midas' balance sheet remains healthy, with cash and cash equivalents of RMB547.0 million as at December 31, 2012.
In appreciation to the support of its shareholders, the Group has proposed a final cash dividend of 0.25 Singapore cent per ordinary share. In total, this works out to a total dividend payout amounting to 0.5 Singapore cent per ordinary share for FY2012.
Outlook
The PRC rail transportation industry is expected to grow in 2013, underpinned by the PRC Government's support to grow China's transportation network. The Ministry of Railway had in January 2013 announced the Government's plans to invest approximately RMB650 billion into the railway sector, of which approximately RMB520 billion is planned for the development of railway infrastructure (Note 1).
The PRC metro train sector is also expected to see increased activities in 2013, with the National Development and Reform Commission ("NDRC") approving an additional two metro projects worth a combined RMB49 billion in November 2012 (Note 2). The latest project approvals comes on top of an earlier announcement by the NDRC in September that it has approved project plans and feasibility studies for 25 metro projects with estimated investments valued at over RMB700 billion (Note 3), which represents a strong pipeline of opportunities for industry players.
In view of the above, while lingering concerns from the sector slowdown in late 2011 and 2012 are expected to have continued impact on the Group's near-term operating performance, the Group remains cautiously optimistic on the outlook of China's railway industry over the medium to long-term.
"With the PRC economy anticipated to grow at a faster pace in 2013 and the Central Government's continued push for the development of transportation infrastructure, we remain confident about the long-term growth of the PRC railway sector. Nonetheless, to better position ourselves against uncertainties in the operating environment, we will continue to remain prudent, and grow our core businesses with a view towards broadening our revenue streams in other product segments and geographical markets," Mr. Chew concluded.
Note:
About Midas Holdings Limited
Founded in 2000, Midas is today the leading manufacturer of aluminium alloy extrusion products for the passenger rail transportation sector in the PRC. Over the years, Midas has built an established track record in supplying to the PRC passenger rail transportation sector, which includes participation in landmark contracts such as trains for the Beijing-Tianjin High Speed Train Project, and inter-city high speed trains for the CRH3-380 Project. Midas' customers include domestic PRC licensed train manufacturers from China South Locomotive & Rolling Stock Corporation Limited and China CNR Corporation Limited, as well as international customers such as Alstom Transport, Siemens AG and Bombardier Transportation.
Midas has a strategic 32.5% stake investment in Nanjing SR Puzhen Rail Transport Co., Ltd ("NPRT"), an associate company engaged in the development, manufacturing and sale of metro trains, bogies and their related parts.
In 2012, Midas was honoured with the ‘Supplier of the Year Award' by Bombardier Transportation, one of the world's leading manufacturers of innovative aerospace and rail transport solutions. In recognition of its consistent growth and profitability, Midas was included in Forbes Asia's "Best Under A Billion" list for four consecutive years from 2006 to 2009. The Company was also awarded the "Best Investor Relations Award (Gold)" at the Singapore Corporate Awards 2010 in the "S$300 million to less than S$1 billion market capitalisation" category. As testament to its strong brand name and reputation in the PRC, Midas was conferred the prestigious "China Well-Known Trademark" by the Trademark Office of the State Administration for Industry & Commerce of the PRC ("SAIC") in 2011.
Midas has a primary listing on the Mainboard of the Singapore Exchange Securities Trading Limited and a secondary listing on the Main Board of the Stock Exchange of Hong Kong Limited.