Net Profit surges by 32.9% to HK$51.3 Millon
Revenue increases by 9.9% to HK$628.8 Million
To diversify supplier base and product offerings as well as identify suitable suppliers and products in pursuit of more dealerships and distributorships of heavy equipment
Tak Lee Machinery Holdings Limited (“Tak Lee” or the “Company”, together with its subsidiaries, the “Group”; stock code: 2102), a leading earthmoving equipment sales and leasing service provider in Hong Kong, is pleased to announce its first annual results for the year ended 31 July 2020 (“the Year”) since transferring its listing to the Main Board of The Stock Exchange of Hong Kong Limited on 6 October 2020. Despite the challenging economic climate and COVID-19 pandamic, the Group has recorded remarkable results for the Year.
Financial Highlight
– Revenue of the Group increased by approximately 9.9% to approximately HK$628.8 million, mainly attributable to the strong performance of its leasing business
– The Group’s net profit attributable to the owners of the Company surged by approximately 32.9% to approximately HK$51.3 million
– Gross profit increased by 33.2% to approximately HK$107.1 million, while gross profit margin increased 2.9 percentage points to approximately 17.0%
– Earnings per share for the Year was approximately HK5.13 cents, representing an increase of approximately 32.9%
– The Board has recommended the payment of a final dividend of HK1.0 cent per ordinary share. Together with a special dividend of HK1.5 cents per ordinary share paid, the total cash dividend for the Year will be HK2.5 cents per ordinary share
The Group’s revenue increased by 9.9% to approximately HK$628.8 million (FY2019: HK$572.0 million) for the Year. The increase was mainly attributable to the rise in leasing income and the upturn in machinery ancillary services income, especially revenue from the leasing of heavy equipment which jumped by 159.1% to approximately HK$170.5 million (FY2019: HK$65.8 million). The Group has actively expanded its leasing business during the Year, in view of growing demand arising from the commencement and progress of large-scale infrastructure and reclamation projects in Hong Kong, such as the Three Runway System of the Hong Kong International Airport and the Tung Chung New Town Extension. Profit attributable to the owners of the Company increased notably by 32.9% to approximately HK$51.3 million. Furthermore, gross profit rose by 33.2% to approximately HK$107.1 million during the Year (FY2019: HK$80.4 million), while the gross profit margin increased by 2.9 percentage points to approximately 17.0% (FY2019: 14.1%). Earnings per share for the Year climbed 32.9% to approximately HK5.13 cents per share (FY2019: HK3.86 cents per share).
To reward the Group’s shareholders for their unwavering support, the Board has recommended the payment of a final dividend of HK1.0 cent per ordinary share. Together with a special dividend of HK1.5 cents per ordinary share paid, the total cash dividend for the Year will be HK2.5 cents per ordinary share.
Prospects
Even though the economy will remain challenging, and the industry that the Group operates in may directly or indirectly be affected by such challenging conditions, the Group remains cautiously optimistic about its outlook, including the prospects for its sales and leasing of heavy equipment. Such optimism can be attributed partly to the government’s land enhancement strategy, which involves the proposed reclamation and rock cavern development. Also, there are several other large-scale infrastructure projects underway, such as the Three Runway System of the Hong Kong International Airport, Route 6 Development and the Tung Chung New Town Extension. The Group therefore expects stable growth in the heavy equipment industry in Hong Kong in the near future. In addition, the Group is committed to the diversification of its supplier base and product offerings to capture opportunities. During the Year, the Group has entered into a new dealership agreement under which the Group has been granted a dealership for foundation equipment. While closely monitoring the impact of COVID-19 on the industry, the Group remains committed to fulfilling its corporate strategies which are aimed at sustaining and raising the performance of the Group over the long term.
Mr. CHOW Luen Fat, Chairman and Chief Executive Officer of Tak Lee, said, “We believe that the demand for our heavy equipment will remain strong in the coming years. Still, we are committed to capturing fresh opportunities; hence, we will endeavor to diversify the Group’s supplier base and product offerings. We will also continue to identify suitable suppliers and products, and pursue more dealerships and heavy equipment distributorships that further enhance the Group’s long-term competitiveness.”
About Tak Lee Machinery Holdings Limited (stock code: 2102)
Tak Lee Machinery Holdings Limited is one of the leading heavy equipment sales and leasing service providers in Hong Kong, serving customers by providing quality heavy equipment, such as excavators, articulated dump trucks, bulldozers, lifting cranes, hydraulic breakers and various other heavy equipment. Among all the dealerships and distributorships granted, Tak Lee is the sole dealer of HITACHI brand (Japanese brand) of heavy equipment in Hong Kong and Macau, as well as a distributor of heavy equipment of BELL (South African brand) and LaBounty (USA brand) in Hong Kong and an exclusive dealer of heavy vehicles of Ammann (Swiss brand) in both Hong Kong and Macau. In 2016, Tak Lee started and engaged an Italy-based manufacturer to design and manufacture its own TLMC brand earthmoving equipment to provide more quality heavy equipment for its customers to choose from.