Konka Group sees profits climb as margins shrink
Shenzhen-listed colour television maker, Konka Group Co (formerly Konka Electronics Holdings) has reported an 18.21 per cent rise in net profit to 267.689 million yuan (about HK$249 million) for 1995, compared with 226.455 million yuan previously.
The net profit was calculated according to international accounting standards.
Earnings per share rose from 0.81 to 0.95 yuan in the year.
Despite turnover having risen by 44.74 per cent from 2.401 billion to 3.475 billion yuan, operating profit fell 2.75 per cent to 273.095 million yuan, squeezing profit margins.
Profit margin last year was 7.85 per cent, down from 11.6 per cent in 1994, showing rising output costs in China.
The company said it achieved a record high in total industrial output value which reached 4.306 million yuan.
It said the annual output of products amounted to 2.37 million sets, of which 1.77 million were colour television sets and 0.6 million, were hi-fi and communication products.
According to figures from the Electronics Industry Association of Japan (EIAJ), China's demand for colour television sets was 14.2 million units in 1995 and is seen to reach 20 million sets by 2000.
Konka said its annual domestic sales volume of colour television sets was 1.31 million sets.
This represents an annual rise of 44.75 per cent and 18.21 per cent over sales in 1994 in terms of sales revenue and net profit.
The company said it was laying emphasis on science and technology to develop advanced products to expand its market.
During the course of the year Shaanxi Konka Electronic Co was established.
Together with Dongguan Konka Electronic Co, the two companies were seen as major production bases for the group, forming a triangular production network which covers the south, northwest and northeast of China.
