TCL sells subsidiary to focus on flat-panel TVs
TCL Multimedia Technology Holdings, the mainland's biggest television maker, has generated a 70 million yuan (HK$80.3 million) gain after stepping up the disposal of non-core assets in line with its plan to focus on advanced flat-panel displays.
The Tsuen Wan-based firm, part of electronics manufacturing giant TCL Corp, yesterday said the profit was from a deal made by its wholly owned subsidiary, TCL King Electronic (Shenzhen), which sold one of its business units to an undisclosed buyer for 103 million yuan.
That followed TCL Multimedia's divestment last year of its 45 per cent stake in TCL Digital Science and Technology (Wuxi) Co to a group of buyers for 159 million yuan, a transaction in which it recorded a HK$38.5 million gain.
These sell-offs are helping the firm streamline its operations, while it invests more resources in producing new lines of TVs using liquid crystal display (LCD) and light-emitting diode (LED) technologies.
Founder and chairman Li Dongsheng (pictured) said in April that the restructuring programme also covers the firm's sales and marketing, research and development, manufacturing and supply chain. The goal is 'to meet ever-changing customer demand and keep pace with rapid market growth', Li said.
TCL Multimedia posted a 69.2 per cent increase in first-quarter net profit to HK$43.7 million from HK$25.7 million last year on steady domestic demand, strong growth in Europe and prudent cost controls.
Revenue grew 3.8 per cent to HK$6.76 billion from HK$5.01 billion, as sales of LCD TVs rose 60.7 per cent year on year to 1.93 million sets worldwide.
Li expected competition in the industry to intensify this year, as the economic outlook improves worldwide. He said research and development would remain a key strength for the firm. In the first quarter, it launched 16 new LCD products, including six LED-backlit models and an internet-linked 3-D TV. Its internet TV line, called 'MiTV', was introduced last year. The stakes are high for the new 3-D TV market segment because more consumers worldwide are being exposed to 3D movies, such as Avatar. Consumers are expected to prefer viewing these 3-D films on video at home. Market analyst group In-Stat projected annual 3-D TV shipments will reach 41 million sets by 2014. According to research firm DisplaySearch, the positive influence of new technology, such as 3-D and LED, is projected to boost worldwide TV shipments by more than 10 million units this year to 228 million units.
