Hengdeli Announces 2017 Annual Results

Results Summary:- Recorded revenue of RMB2,439,022,000, representing a year-on-year increase of1.3%- Gross profit margin was approximately15.8%, representing a year-on-year increase of 20bpsLossof the group for the year amounted to approximately RMB165,080,000, narrowing 40.1% as compared with the loss recorded in the same period of last year.

2017 has seen a gradually improved trends of recovery from sluggishness in global and China's economic conditions. There were numerous risks and challenges lingering on corporate operations, especially in the first half of the year. As at 31 December 2017, the Group recorded revenue of RMB2,439,022,000, representing a year-on-year increase of 1.3%; the Group recorded a loss of approximately RMB165,080,000, narrowing 40.1% as compared with the loss recorded in the same period of last year. The loss was mainly due to the deduction of non-recurring profits tax on the disposal, redemption of senior notes and impairment on goodwill etc.

For the purpose of safe and healthy development, the Group completed a very substantial disposal in the first half of the year under review. After the completion of which, the Group's business mainly covered sales of international renowned watches in areas such as Hong Kong, Macau and Taiwan and manufacturing of related accessories.

For the sales of renowned watches, the Group operated a total of 61 retail outlets in areas such as Hong Kong, Macau and Taiwan as at 31 December 2017. With the gradual improvement of the business environment and the enhancement of the management level, the Group's sales in Hong Kong recovered steadily, reversing the continuous decline in recent years. The retail sector in Taiwan remains stable and does not have much change compared to that of last year.

During the year under review, an "Elegant" multi-brand shop was opened on Yun Ping Road, Causeway Bay where has all long been a commercially prosperous district. The opening of this shop contributes to the increase of the Group's sales in Hong Kong. The Group opened an "Elegant" store at Section 5, Chungshiao East Road in the downtown area of Taipei in May 2017. The store was a self-owned property. The opening of the store saves a considerable amount of rental costs, driving sales growth, increasing the Group's market share in the Taiwan region and while embodying the Group's strategic goal of in-depth development in the Taiwan region.

The Group continued to progress well in the watch accessories business during the year under review. With the increasing industrial investment and the enriching customer resources, the Group has also collaborated more closely with brand suppliers. Stable increase was achieved in the Group's export business and during the year under review, the Group's two new factories located in Suzhou and Guangzhou respectively have been formally put into operation, and both are designed in compliance with the latest requirements of "Environmental Impact Assessment (EIA)". Meanwhile, highly qualified specialists are engaged for technical innovation. Through unremitting efforts, the manufacture and sale of Group's accessories keeps a good momentum of growth, an increase of 6% as compared with the same period of last year. The overall market competitiveness has achieved a better result.

The Group's customer service and maintenance team keeps the promise of "Cutting-edge technology, efficient management, and considerate services". It is the best guarantee for consumers. With continuous training provided by brand suppliers to the Group's technical personnel and the human resources policy of recruiting talents worldwide, the Group has been able to retain the support of elite technicians and its world-wide cutting edge maintenance expertise.

At present, the global economy has begun to fully recover. High-quality development will create a new era of global economy and thus bring new development opportunities to other Southeast Asian regions including Hong Kong and Macau and also bring good prospects to the Company. Amidst the new economic environment, the Group will keep seeking truth from facts, and striving for progress by sticking to the principle of "maintaining stable and healthy growth and seeking sustainable development". The Group will endeavor to keep its renowned watch sales healthy and stable and will step up efforts in promoting watch accessories manufacturing and other businesses, and on the other hand, standing on a new starting point, the Group will also put their heads together and all efforts to explore to engage a deeper level of cooperation with brand suppliers and international peers through various ways, continue to expand business coverage, diversify business models and seek for newer and broader development for the Group in order to create greater value for both shareholders and community at large.

Hengdeli Holdings LimitedHengdeli Holdings Limited (the "Company" or "Hengdeli" and its subsidiaries, collectively as the "Group") is a recognised retailer of internationally renowned brand watches and manufacturer of watch accessories. The Group's shareholders include: the Zhang family; the prestigious watch manufacturer SWATCH Group; distributor and internationally respected luxury goods conglomerate LVHM Group.

The Group owns an extensive retail network comprised of: "Elegant" (top internationally renowned brand watches), "Hengdeli" (mid and mid-to-high end internationally renowned brand watches), as well as single-brand boutiques. As at 31 December 2017, the Group had 61 retail outlets, selling watches from more than 50 internationally renowned brands in Hong Kong, Macau, and Taiwan etc, and provides comprehensive after-sales services for internationally renowned brand watches.

The Group also owns a number of watch accessories manufacturing enterprises, including the manufacturing of furniture and items used for watch sales and watch packaging products, commercial space design, production and decoration, serving customers throughout the greater China region, Asia Pacific and other countries and regions such as Switzerland and the United States.

The Group has maintained sound and in-depth collaborations with many world-renowned premier brand suppliers including SWATCH Group, LVMH Group, RICHEMONT Group, and KERING Group etc..

The Company has been listed on the Main Board of the Hong Kong Stock Exchange since 2005 under stock code 3389. The abbreviated stock name is: Hengdeli

Topic: Press release summarySectors: Daily Finance^[1] http://www.acnnewswire.com From the Asia Corporate News Network

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References

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