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Home Media Centre Press Release Tongda Group Announces 2014 Annual Results Focusing in development of mid-range to high-end smartphone business Revenue and profit continued to record an impressive growth

Tongda Group Announces 2014 Annual Results Focusing in development of mid-range to high-end smartphone business Revenue and profit continued to record an impressive growth

Financial Highlights



For the Year Ended 31 December










Gross Profit




Gross Profit Margin




Profit Attributable to Owners of the Company




Basic Earnings Per Share

HK 9.44 cents

HK 7.47 cents


Final Dividend Per Share

HK 2.00 cents

HK 1.60 cents




(Hong Kong, 18 March 2015) - Tongda Group Holdings Limited (“Tongda Group” or the “Group”) (Stock Code: 698) announced its annual results for the year ended 31 December 2014 (the “Year”).

During the year under review, domestic handset brands are focusing more on outstanding specifications and product differentiation. In addition, the Group has further widened the customer base, which also leads to the impressive growth in all of its business segments. As at December 31, 2014, the Group’s revenue went up by 32.1% to HK$4,791.3 million year-on-year. The gross profit of the Group rose by 43.3% to HK$1,143.6 million. The profit attributable to owners of the Company increased by 39.3%to HK$501.7 million, and the overall gross profit margin and net profit margin jumped by 22.0% and 9.9% in 2013, to 23.9% and 10.5%respectively.


The Board has recommended the payment of a final dividend of HK 2.0 cents per share (2013: HK 1.6 cents) during the year. Together with an interim dividend of HK 1.0 cent per share already paid, the total dividend for the financial year amounts to HK 3.0 cents per share (2013: HK 2.5 cents), representing a dividend payout ratio of 32.7%.


The Group has maintained a healthy financial position. On December 31, 2014, its pledged deposits, cash and cash equivalent balances of approximately HK$477.6 million (2013: HK$240.4million).


Mr. Wang Ya Nan, Chairman and CEO of Tongda Group, said, “During the year, as a result of the Group’s efforts to develop mid-range to high-end products such as metal and ultra-thin In-Mold Transfer (IMT) Technology handset casings, along with enhanced automation and utilisation of production capacity as well as the effective cost control, the Group again reported a growth in profit margins. Producers of electronic products in China have emphasized products with higher specification and greater differentiation, which have higher requirements for appearance, texture and mechanical performance. As the world’s leading solution provider of high-precision components used in consumer electronic products, the Group can leverage its unrivalled professional technologies, enabling it to maintain a leading position in both domestic and international markets and achieve continuous growth in its business performance. ”

Business Review


The Group’s electrical fittings division, includes three business segments, namely handsets, notebook computers and electrical appliances. During the year under review, total revenue increased by 26.2% to HK$3,637.0million (2013: HK$2,882.5 million), representing 76% of the total revenue. Besides, the Group also includes ironware parts division, communication divisions and other business.





The Group’s new production plant in Xiamen commenced Phase 1 operation in October last year. It focused on production of handset casings and offered a timely boost to meet the orders in the traditional peak season during the fourth quarter of year, adding to a surge in order for metal casings, revenue of handsets increased by 29.9% to HK$2,415.0 million, accounted for 51%of total turnover.

The Group has been progressing alongside with various fast growing domestic and international brands, including Huawei, Xiaomi, OPPO, ZTE, Lenovo, Coolpad and TCL.At the end of last year, the Group added Asus, a Taiwan brand, to its customer base. The Group commands a leading technology in the domestic market in Nano Moulding Technology (“NMT”), which attaches metal and plastic at Nano level, resulting in thinner but stronger products. Moreover, production lead time is generally shorter than traditional uni-body metal casing while assembly is easier with higher passing rate. The Group also allocated more resources to Computer Numerical Controlling (“CNC”) machines and concentrated on the production of high-end metal casings. Metal Injection Molding (“MIM”) technology can produce complicated and delicate components. These technologies of the Group may cater for the growing demand for delicate metallic casing.

Electrical Appliances


The Group focused on premiumproducts last year, and the revenue of the Groups electrical appliances business increased by 26.6% to HK$588.4million, representing 12% of the turnover. Its majorcustomers include well-known electrical appliance brands in China such as Haier, Gree and Midea,while its overseas clients include Panasonic, Zojirushi, Electrolux and the newly added customer such as DYSON. Theunderlying products include panels for air-conditioners, refrigerators, washing machines and rice-cookers.

Last year, the Group applied one-piece shaping IML technology to produce a large scale casing of 1.8 meter high for floor-standing air-conditioners. The high-profit-margin item was well-received by its customers. The Group has also integrated the clients’ control panels with touch film switch (Indium Tin Oxide (“ITO film”)), which should help to increase the unit price of relevant products. This type of casings with rich functions and texture helps to cement the Group’s leading position in the high-end electrical appliances market.


Notebook Computers


During the period, revenue from notebook computers increased by 13.5% to HK$633.6 million, representing 13% of the total turnover. During the year, the Group upheld the main objectives of reinforcing relationship between Chinese, Japanese and Taiwanese brands and actively tapping into Europe and the United States (“US”) markets. The department’s major clients were Lenovo and NEC. Orders from overseas brands such as Toshiba, Fujitsu and HP also remained stable. Major products include delicate metal or plastic ultra-book and tablet casings with light, simple and grand design.

Ironware parts and communication divisions and other business


Revenue from ironware parts and communication division increased by 39.7% and 85.0%year-on-year to HK$687.7 million and HK$466.6million respectively, representing 24%of the total turnover. During the year, performance of the division was boosted by the increase of the electrical appliancesbusiness, increase in demand for high-resolution plastic set top boxes spurred by the FIFA World Cup, as well as the production of durable goods for new customers like IKEA from Sweden, Decathlon from Franceand Wagner from US, all of the above have also driven the growth of business performance.



Total revenue contribution of product segments as compared to the same period last year as at  December 31, 2014:




Electrical Fittings Division



i. Handsets



ii. Electrical Appliances



iii. Notebook Computers






Ironware Parts Division






Communication Facilities Division and Other Business








According to market forecasts, handsets shipment in China shall post steady growth in the coming year. With the raising demand from the major customers on mid-to-high-end product line, the development in differentiated product segments, including the metal casing and functional antenna components, will be benefited. The Group will closely monitor the market trend and commit to the research and development (“R&D”) of diverse application of decoration technology with increased capacity for metal handset casing when necessary and will keep working on new technology development to enhance the productivity of metal casings and upgrade the overall integrating capacity of the handset operation.

The construction of networks under the fourth generation wireless communication system (“4G”) licenses in the Mainland had made further progress in the second half of last year. With more comprehensive handset hardware supporting system and surging number of users of 4G handsets, the mobile communication in the Mainland had turned to a new page. The Group’s Laser Direct Structuring (“LDS”) antenna technology, a prevailing core technology for 4G handsets, will be benefited from the popularity of 4G handsets.

For electrical appliances, the high-end segment of intelligent and exquisite appliances featuring energy efficiency and environmental protection elements remained under the spotlight in both domestic and global markets. In view of customers’ demand, the Group will strengthen its R&D in panels and boost product value by embedment of functional parts. Targeting the enormous demand for high-end panels in European and US markets, the Group will actively approach high-end brands to expand its client base.

As the global notebook computer market is stabilising, the Group will continue to focus on the Mainland and at the same time venture into Japan and international markets to absorb new customers actively. The offerings cover ultra-thin casings with refined texture and peripheral products for tablets and mouse casings.


Mr. Wang concluded, “The management is confident about the business development in the coming year. The Group will respond swiftly to changes as always, and actively develop new technologies and technical knowhow. Also, we willexplore new business in segments with higher profit margin, such as the interior decoration for automotive in order to achieve the long term sustainability. The Group will, as it always does, endeavor to maintain a healthy financial position and stable dividend ratio, so as to bring greater returns to shareholders and employees with utmost efforts.”


Home Media Centre Press Release Tongda Group Announces 2014 Annual Results Focusing in development of mid-range to high-end smartphone business Revenue and profit continued to record an impressive growth