Shenzhen, China, May 30, 2006--Asia Dekor Holdings Limited, a producer and distributor of laminated floor and related products in Asia, announced its annual results for the year ended 31 March, 2006 ("FY2006").
The Group posted strong results for FY2006, which saw turnover rise by 27.3% to RMB 574,001,000 (FY2005: RMB 450,833,000) and profit attributable to shareholders increase by 37.2% to RMB 102,531,000 (FY2005: RMB 74,720,000).
Growth of the turnover during FY2006 was primarily attributed to the strong demand for the firm's laminated flooring products and increased contribution from its wood-panel manufacturing business. Sales of laminated flooring products increased by 13.7% from 10.21 million sq. metres in FY2005 to 11.61 million sq. metres during the period, while sales of wood-panel products to external customers increased significantly by from 4,700 cubic meters in FY2005 to 59,000 cubic meters during FY2006.
During FY2006, gross profit increased significantly by 38.5% to RMB 163,805,000 as compared to RMB 118,286,000 in FY2005, while gross profit margin improved to 28.5% from 26.2% in FY2005. This was primarily due to lower material cost of High Density Fibreboard by the successful implementation of the firm's strategy of shifting from European imports to self-supply from the Heyuan factory.
Given the strong financial performance, the company announced the recommendation of a final dividend of RMB 1.50 cents per share for FY2006.
In January 2006, the company successfully completed its particleboard production plant in Huizhou, Guangdong Province, China. With a total investment of approximately US$30 million, the new plant is an advanced and one of the largest production facilities of particleboards in China. With a designed annual capacity of 200,000 cubic metres, the plant was built over 15 months using German technology. The particleboard facility is strategically located in Huizhou, Guangdong, which is known as China's largest furniture production region, with Dongguan and Shenzhen being the leading markets.
The Huizhou factory has just begun commercial production of particleboards in March 2006. The company expects that, with the increasing demand of particleboards in the markets of Shenzhen and Dongguan, the Huizhou factory would contribute positively to profitability in the current financial year.
On 31 March 2006, the firm announced a placement of a total of 50,000,000 new ordinary shares of HK$0.15 each in the share capital of the company at S$0.1425 for each placement share. The net proceeds from the placement amounting to approximately S$6,900,000 will be used for the reduction of a long term bank loan which was drawn down for financing the construction of the Heyuan factory.
The firm expects that the current financial year will remain challenging as the business environment and market conditions would continue to be competitive in China. However, the firm remains confident as it is well positioned in the region in terms of product branding, factory locations and technological capability. The firm will focus towards integrating and streamlining its existing and new manufacturing facilities, improving product quality, strengthening financial management, enhancing marketing capability and increasing overall operational efficiency to pursue future growth.
They will also launch more products with innovative features to the market in the current financial year in order to be in line with the market demand.
Asia Dekor Holdings Limited was established in 1994 and listed on the Singapore Stock Exchange in November 1999. A leader in its industry, Asia Dekor is fully vertically integrated in the design, manufacture and sales and distribution of laminated wood flooring, particleboards and related panel products.
