Jittery home furnishings firm to relocate factories
Home furnishing group Man Wah Holdings (1999) said it may move some of its manufacturing activities from China to Southeast Asia in order to mitigate export risks from the Sino-United States trade war.
Man Wah said it will invest HK$50 million to HK$80 million in setting up factories in Vietnam.
The group yesterday reported its annual results for the year ended 31 March, with a 12 percent drop of net profit from HK$1.75 billion to HK$1.54 billion, due mainly to exchange loss during the year. "We continue to see challenges in our major markets," said chairman of the group Wong Man-li.
Major revenue of the group was generated from the sales of sofas and auxiliary products, amounted HK$8.08 billion, up 15.7 percent from a year earlier, which accounted for 80.5 percent of total's revenue.
The annual sofa production capacity in China amounted to 1.59 billion sets. A new construction of the new factory in Chongqing is expected to be completed by the end of the year and will add 300,000 sets to overall production capacity.
While a 56 percent increase of revenue was recorded from the sales of from bedding, furniture components and other products.
The board has proposed a final dividend of HK 12 cents per share. Together with the interim dividend of 13 HK cents declared, the full year dividend amounted to 25 HK cents.