Dah Chong Hong Holdings (DCH) announced a 77.8 per cent increase in profit attributable to shareholders to HK$480 million and a 49.1 per cent increase in turnover to HK$14.12 billion for the six months ended June. 'The results are above our expectations,' says David Kuk Tai-wai, the managing director of DCH Logistics. 'We plan to continue our expansion on the mainland ... under our 'China Momentum' plan.' Excluding non-operating items, such as net valuation gain or loss from investment properties, the adjusted net profit attributable to shareholders surged 68.4 per cent to HK$500 million, while the adjusted net profit margin increased 0.4 percentage point to 3.5 per cent. The board of directors recommended an interim dividend to shareholders of 10.68 HK cents per share, a 136.8 per cent increase from a year earlier. Interim dividend is based on 40 per cent dividend payout ratio. DCH plans to strengthen its business on the mainland, where turnover rose 62.2 per cent during the first six months of this year. The mainland was responsible for 66.6 per cent of the group's total turnover, while Hong Kong and Macau contributed 26.7 per cent. The remaining 6.7 per cent came from other markets including Singapore and Taiwan. DCH has businesses in the motor segment, food and logistics. The motor-related businesses accounted for 75.5 per cent of total turnover, while food and consumers products made up 23.3 per cent. The remaining 1.2 per cent came from its logistics and other businesses. Turnover of the motor-related businesses rose 64.9 per cent for the six months to HK$10.66 billion compared with HK$6.46 billion a year earlier, while segment profit after taxation increased 94.8 per cent to HK$487 million, with a segment margin at 4.6 per cent compared with 3.9 per cent a year earlier. The national importer and distributor of Bentley and Isuzu vehicles on the mainland recorded 116 per cent and 132.4 per cent growth, respectively. The group expanded its dealership network by adding eight more 4S shops through the acquisition of Shenye Shiye Group. With the opening of its Lexus dealerships in Shanghai and Cixi City, in Ningbo, Zhejiang, the group owns 50 4S shops on the mainland, and plans to open six more in the second half of this year. Sales of commercial vehicles through DCH's 4S shop network on the mainland grew 170.7 per cent. The group also has businesses in motor leasing and parts trading on the mainland. It is also investing in used car trading and introducing a vehicle inspection centre in Guangzhou. The group's independent motor service centre in Dongguan and lubrication oil blending plant in Xinhui will begin its operations in the second half of this year. DCH's fast-moving consumer goods (FMCG) businesses on the mainland also achieved satisfactory results, with approximately 40 per cent growth and a 14.9 per cent increase in segment turnover. A 20.4 per cent increase in segment turnover to HK$118 million was recorded for the group's logistics business compared with HK$98 million a year earlier. Segment profit taxation was HK$11 million, while segment margin dropped slightly from 10.2 per cent a year earlier to 9.3 per cent. The group's Yuen Long Logistics Centre has been in operation since the first quarter of this year, while its new logistics facility in Xinhui, which includes cold storage, a bonded warehouse and third party logistics warehouses, started operations in phases in the second quarter. 'Though the logistics segment is still in its development stage on the mainland, we are expanding our infrastructure to meet the surge in demand, and it has created a good synergy to support our food businesses in the mainland through collaboration with our FMCG projects,' Kuk says. 'We have developed a more comprehensive regional logistics platform, enabling us to extend our services to more local and overseas customers, and strengthen our ties with existing clients and partners of our food distribution business.' The group intends to continue the development of its logistics platform, which now includes temperature-controlled storage, bonded warehousing, cross-border and intra-cities distribution, material procurement, customs clearance and declaration, packaging and other value-added services in the Pearl River Delta.