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Valuetronics' 1H earnings fall 12.1% to $15.9 mil on lower revenue

Felicia Tan
Felicia Tan • 2 min read
Valuetronics' 1H earnings fall 12.1% to $15.9 mil on lower revenue
An interim dividend for the 1HFY2021 has been declared at 5 HK cents.
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Valuetronics Holdings reported earnings of HK$91.5 million ($15.9million) for the 1HFY2021 ended Sept 30, 12.1% lower than earnings of HK$104.1 million posted in the corresponding period the year before.

This came on the back of a 19.9% decline in 1HFY2021 revenue of HK$1.09 billion from HK$1.37 billion in 1HFY2020 as revenues for the company’s two segments fell.

Revenue for Consumer Electronics fell 35.8% y-o-y to HK$365.1 million due to reduced demand from the Covid-19 pandemic, while revenue for Industrial and Commercial Electronics fell 8.6% y-o-y to HK$729.8 million due to the lower demand from some customers.

Sales to the auto customer suffered a “significant drop” due to the decline in global vehicle production.

The lower figures were partially mitigated by the “relatively stable” revenue contribution from “a printer customer which benefits from e-commerce sales and a sensing devices customer which benefits from its product’s application in logistics industry”.

Gross profit for the period fell 9.7% y-o-y to HK$185.9 million. Gross profit margin, however, was up by 1.9 percentage points to 17.0% due to a change in product sales mix during the half-year period.

See Also: DBS initiates coverage on Valuetronics with 'hold' on strong fundamentals, and potential shift in supply chains

Other income fell 16.9% y-o-y to HK$11.4 million mainly attributable to the decrease in interest income after “several rounds of interest cuts”.

Selling and distribution expenses fell 8.5% y-o-y to HK$13.6 million due to the decrease in revenue and corresponding commission expenses.

Administrative expenses fell 8.7% y-o-y to HK$79.7 million due to the stricter cost control measures during the period.

Earnings per share (EPS) for the 1HFY2021 stood at 21.0 HK cents, down from the 24.0 HK cents in the same period last year.

As at Sept 30, cash and cash equivalents stood at HK$1.05 billion.

An interim dividend for the 1HFY2021 has been declared at 5 HK cents.

Looking ahead, the group says it expects to remain profitable for the FY2021, although it is less certain about the near-term outlook amid the Covid-19 pandemic and Sino-US trade tensions.

Shares in Valuetronics closed 1.5 cents lower or 2.5% down at 58 cents on Nov 10.

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