Monday, March 1, 2021
 
Columnist
Martin Hennecke
 
TECH PRO
HKEx Stock Code : 03823 
 
Corporate Profile
The principal activities are the manufacture and sale of aluminum electrolytic capacitors, chip type electronic components and LED lightings.

Business Review - For the year ended December 31, 2012

To capitalise on the strengthening international campaigns for environmental protection, the Group was transforming its business to LED (light-emitting diode) lighting products manufacturing and the provision of LED lighting solutions in 2012, and made good progress.

The new business of LED lighting was gaining momentum in development and posted a substantial growth, driving up the Group's turnover by 119.1% to approximately RMB619.2 million for the year ended 31 December 2012. The LED lighting segment's turnover from continuing operations rose by 12.9 times to approximately RMB303.6 million in 2012 (2011: approximately RMB21.9 million). LED lighting segment's adjusted EBITDA increased by 87.7% to approximately RMB71.8 million (2011: approximately RMB38.3 million). The effect of the business transformation to the LED lighting production and sales became more noticeable in 2012 and is expected to become the Group's profit driver in 2013.

In a push to expand the business overseas and build up the ¡§LEDUS¡¨ brand, the Group's subsidiary in Spain, Tecdoa Energy, which the Company acquired in 2011, won a tender for the installation and maintenance of public lighting from the Town of Tarancon, Spain, jointly with Indra Sistemas, S.A. in October 2012.

We believe the Group's LED business has bright prospects because the global environmental movements are gaining momentum, and, at home, the Chinese government is enacting more policies to foster the development of environmental industries. Environmental-friendly and energy-saving businesses are gaining more and more recognition. In 2012, the Group's LED lighting segment performed satisfactorily despite the tough economic conditions. The LED lighting business, which can sell to a wide client base ranging from corporations to households because it encompasses a wide section of the value chain, will serve as a new source of income and protects the Group from volatility of business of a single product.

In order to improve the returns to its shareholders, the Group was scaling down the business of manufacturing and selling aluminum electrolytic capacitors and chip type electronic components which had been making a loss. Accordingly, the Group disposed of the Hai Te Wei Group and the Tong Tai Group by the end of 2012. It will continue to scale down the business segment of aluminum electrolytic capacitor and focus on the LED lighting business segment, which has brighter prospects.

Business Outlook - For the year ended December 31, 2012

Looking ahead, the Group is optimistic about its future in 2013 despite the challenges ahead. It will continue with its efforts in developing new products and technology, with emphasis on quality control, cost competitiveness and technology improvement. The Group will also develop global sales distribution channels for its products under its own brand ¡§LEDUS¡¨. In 2013, the Group plans to enter into the wholesale and retail markets and ¡§LEDUS¡¨ products are expected to be sold in large chain shops in Hong Kong. With the successfully bidding the tender in the city of Tarancon, the Group will keep on exploring opportunities to open up the European markets with energy efficiency projects. There are several cities in Spain where we are working with and the Group expects more tenders would be awarded. As environmental protection has become a global trend, the Group is positive about the outlook of the industry of LED lighting and its related products. It expects the LED lighting business to become its major income source in the future. We will continue to seek every opportunity in the rapidly growing LED lighting industry to create value for the shareholders.

Source: Tech Pro (03823) Annual Results Announcement
Chairman Li Wing Sang Issued Capital (shares) 1,116M
Par Value HKD 0.01 Market Capitalisation (HKD) 3,828M
 
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