Tech Pro Technology Achieves Turnaround in 2010 Interim Results

Tech Pro Technology Development Limited.
2010-08-24 10:21 807

Turnover and Profit Attributable to Shareholders Surged 80.3% and 121.2% HONG KONG, Aug. 23 /PRNewswire-Asia/ -- The PRC's leading manufacturer and distributor of aluminum electrolytic capacitors, Tech Pro Technology Development Limited ("Tech Pro Technology" or the "Group"; Stock Code: 3823), today announced its interim results for the six months ended 30 June 2010 ("the period under review"). Unaudited financial summary For the six months ended 30 June 2010 2009 Change (RMB'000) (RMB'000) Turnover 209,635 116,256 + 80.3% Gross profit 25,967 3,609 +619.5% Profit attributable to equity holders/ (Loss) 4,238 (20,034) +121.2% Earnings/(Loss) per share RMB 0.6 cent RMB (3) cents +120.0% Gross profit margin 12.4% 3.1% + 9.3% points During the period under review, turnover of the Group increased by 80.3% to approximately RMB209.6 million, gross profit increased by 619.5% to RMB25.9 million, profit attributable to equity holders of the Company increased 121.2% to RMB4.2 million significantly, earning per share increased 120% to RMB0.6 cents. Gross profit margin was also increased significantly to 12.4%, mainly attributable to an increase in average selling price of the products, enhancement in cost efficiency due to economy of scale achieved through substantial increase in production volume, and an impairment loss for inventories absorbed in cost of sales in previous period. The directors of the Company do not recommend payment of any interim dividend for the six months ended 30 June 2010. Mr. Yan Qixu, Chairman and Executive Director of Tech Pro Technology was pleased with the results and said, "During the period under review, we were able to fully capture the opportunities of economic recovery of the PRC. We endeavored to increase the sales revenue by focusing on the research and development of products, as well as productivity of products and maintained good relationship with our customers, resulting in an increase in the sales of the mid to high end products, which successfully led the Group turnaround in financial performance. Meanwhile, through the strategy of acquiring business with operational prospect and developing new business, the Group successfully diversified our business, and increased the sales revenue." In terms of products category, sale of lug type and screw type capacitors increased drastically by 110.2% to approximately to RMB69.2 million over the same period of last year. Sales of V-chip type capacitors increased by 74.3% to RMB9.3 million. Since last year, the Group has been working towards acquiring portion of equity interests in two companies to expand the business scope of the Group into the environment-friendly and energy saving LED street lamp business and mineral resources business with huge development potential and well supported by state policies. On 9 May 2010, the Group acquired Splendid Victory Development Limited at a consideration of RMB55 million. The Group believes that the acquisition will enable the Group to fully control the development, production schedule and production priority in relation to V-chip type aluminum electrolytic capacitors to enhance the competitiveness of the Group. Looking forward, Mr. Yan Qixu said, "We are optimistic about the business prospects as the economy is showing signs of recovery. In order to meet the needs of the customers and maintain our reputation for high quality products, the Group will continue to optimize the lead wire type, lug type and screw type aluminum electrolytic capacitor products and continue to fully control over the development of V-chip type aluminum electrolytic capacitors in future. Whilst the global energy crisis is deepening, the Group will grasp every opportunity to actively expand the development of LED street lamp business and mineral resources business. It is expected that they will become a new growth driver for the Group. In the meantime, the Group will continue to increase its revenue and expand its market share in the PRC and overseas through the continued implementation of various strategies, bring a better future and generating the best return to shareholders." About Tech Pro Technology Development Limited Tech Pro Technology, was listed on the Stock Exchange of Hong Kong Limited on 6 September 2007, it is principally engaged in the manufacture and sale of aluminum electrolytic capacitors, under its "Chang" brand. The Group has a total of 56 models of aluminum electrolytic capacitor products, comprising lead wire type capacitors, lug type capacitors and screw type capacitors. The Group's extensive sales network includes reliable domestic clients as well as customers from overseas markets such as Taiwan, Hong Kong, Turkey, Korea, Italy, and Russia. The Group has diversified its business in developing into LED Street Lamp and Mineral Resources Business.

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Source: Tech Pro Technology Development Limited.