Electronics manufacturing services provider Valuetronics has reported a net profit of HK$187.1 million (S$31.9 million) for the financial year ended March 31, 2021.

 

This is a 4.6 per cent increase compared with its previous financial year.

 

Overall revenue fell 3.1 per cent to HK$2.28 billion, but gross profit rose 6.5 per cent to HK$386.2 million in FY2021.

 

Revenue in its industrial and commercial electronics segment grew 11.3 per cent to HK$1.4 billion, due to a surge in demand for logistics and e-commerce during the Covid-19 lockdowns.

 

Its revenue from consumer electronics, however, fell 25.7 per cent to HKS$680.7 million, as social distancing and Covid-19 containment measures led to a key customer experiencing weak demand.

 

The group' s other income decreased by 25.4 per cent to HK$18.4 million, mainly due to the decrease in interest income, which was offset by an increase in net exchange gains.

 

The company is recommending a final dividend of 16 HK cents per share, based on its results.

 

It noted that it paid an interim dividend of five HK cents in December 2020.

 

In all, this amounts to 21 HK cents per share, although the payout for FY2020 was 20 HK cents per share.

 

The aggregate dividend amount is about 48.9 per cent of the net profit attributable to shareholders for FY2021 and is in line with the company' s formal dividend policy of paying out 30 per cent to 50 per cent of net profit as normal dividends to shareholders, Valuetronics said.

 

" Despite the uncertainties presented during the pandemic, the group reported relatively stable revenue and profits for FY2021 as compared with FY2020, largely due to an unexpected rebound in customer demand in the second half of FY2021," the company said in a statement.

 

However, Valuetronics chairman and managing director Ricky Tse Chong Hing is expecting the group' s financial results for FY2022 to be " significantly lower" compared with FY2021, with the loss of orders from customers switching their supply chain to other countries due to United States-China trade tension.

 

This is further compounded by uncertainties from a global shortage in components as well as the still-evolving Covid-19 pandemic, he added.

 

On the other hand, the company' s Vietnam expansion is on schedule, with its new campus expected to begin production by the end of FY2022, said Mr Tse.

 

" By then, we will be fully equipped to serve customers' multi-site production strategy as a means to mitigate Sino-US trade tensions, and we will be seeking out new opportunities emerging with our extended geographic footprint," he said.