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  • Oct 23, 2014
  • Updated: 10:02am

Group enjoys record turnover

PUBLISHED : Monday, 12 March, 2012, 12:00am
UPDATED : Monday, 12 March, 2012, 12:00am
 

Hong Kong-based conglomerate Dah Chong Hong Holdings (DCH) announced strong financial results for last year, achieving a record total turnover of HK$46.11 billion - a growth of 43.1 per cent compared with 2010.

DCH said in its results announcement that the profit attributable to shareholders was HK$1.32 billion compared with HK$1.42 billion the previous year, which included an exceptional gain on disposal of a jointly controlled entity, netting HK$331 million. Excluding this exceptional gain, the year-on-year growth was 21.3 per cent.

The group's adjusted net profit for the year ended December 31, 2011, excluding the disposal gain and other non-operating items, amounted to HK$1.23 billion, up 16 per cent from HK$1.06 billion in 2010.

Donald Yip, CEO of DCH Holdings, says the results met his expectations and forecasts. 'We had a good growth on the mainland and Hong Kong in the year,' he says.

DCH has a diversified portfolio in motor and motor-related business, food and consumer products, and logistics.

The group has business operations on the mainland, Hong Kong, Macau, Taiwan, Singapore, Japan and Canada.

The board of directors proposed payment of a final dividend of 12.74 HK cents per share for the year ended December 31 compared with 12.77 HK cents in 2010. Together with the interim dividend of 14.30 HK cents paid during the year, total dividend for the year amounted to 27.04 HK cents.

'Thanks to our diversified business portfolio and prudent expansion strategy, we have kept the promise to our shareholders to continue our growth momentum in 2011,' Yip says.

The group's motor and motor-related business segment continued its strong results with growth of 50.9 per cent in turnover to HK$37.18 billion, despite a slowdown on the mainland. Segment result from operations rose 28.5 per cent to HK$1.67 billion, while segment profit after taxation grew 24.3 per cent to HK$1.26 billion. Yip says this growth was driven by encouraging development of the luxury vehicle business, and continued expansion of the group's dealership network.

DCH said that on the mainland motor and motor-related segment's turnover grew 59.7 per cent to HK$30.90 billion. Unit sales increased 45.2 per cent to 85,448 units, outperforming the 2.5 per cent overall growth of the market.

DCH secured five additional Bentley dealerships in Ningbo, Dalian, Hefei and another two cities in exchange for the early return of the mainland distributorship next year.

Yip says the brand portfolio has expanded to 22 with the acquisition of Ferrari and Maserati dealerships in Guangzhou and Shenzhen. He says the group's target is to add 15 4S shops annually, with a greater focus on super luxury and luxury brands.

In Hong Kong and Macau, European brands recorded strong unit sales growth last year, with Audi, Bentley and MAN reporting growth of 28.5 per cent, 31.4 per cent and 69.2 per cent, respectively. Yip says the group would launch a new brand, Infiniti, this year. He says the first batch of electric buses will be delivered to customers this year.

'We will sell electric buses to franchised bus companies this year, as the government pushes to introduce more environmentally friendly vehicles in Hong Kong.' In Taiwan, the group was appointed to establish a third Audi dealership in New Taipei City following the good performance of the dealerships in Taipei and Hsinchu. The group was appointed as Isuzu's Taiwan distributor this year.

In food and consumer products business, DCH said the group had made substantial progress in developing a total food supply chain platform with the addition of new brands and an extension of the distribution network to more second- and third-tier cities on the mainland.

The segment turnover recorded a 17.2 per cent rise to HK$8.44 billion. Segment result from operations increased 12.7 per cent to HK$160 million in Hong Kong and Macau, and surged 47.9 per cent to HK$105 million on the mainland.

The group formed a joint venture company with Brazilian poultry company BRF to handle all import, processing and distribution of meat products on the mainland, starting business in the first half of this year. The joint venture will distribute 140,000 tonnes of meat products in the first year.

DCH's logistics business segment turnover rose 23.8 per cent to HK$452 million, of which HK$109 million was from internal customers. To support the group's food business and attract more third-party customers, DCH extended the logistics set-up in southern (Guangzhou and Shenzhen) and eastern (Shanghai and Xiamen) China last year and these efforts will continue this year.

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