Materials stockpile cut aimed at gearing

Festive goods maker Perfectech International Holdings plans to cut its gearing to less then 100 per cent this year by reducing stockpiles of raw materials.

Chairman Norman Poon Siu-chung said the company's net debt-to-equity ratio was expected to fall by up to 30 per cent to 96.72 per cent this year, reducing interest expenses significantly.

The company paid interest of $11.19 million for the year to December.

'We will try to keep our stock of raw materials to a minimum to avoid tying up capital,' Mr Poon said.

He ruled out equity financing.

Perfectech was negotiating the acquisition of a $5 million printing factory in Hong Kong, Mr Poon said.