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Financial Statements and Related Announcement::First Quarter Results
Issuer & Securities
Issuer/ Manager VALUETRONICS HOLDINGS LIMITED
Securities VALUETRONICS HOLDINGS LIMITED - BMG9316Y1084 - BN2
Stapled Security No
Announcement Details
Announcement Title Financial Statements and Related Announcement
Date & Time of Broadcast 11-Aug-2017 22:04:54
Status New
Announcement Sub Title First Quarter Results
Announcement Reference SG170811OTHR55LC
Submitted By (Co./ Ind. Name) Tse Chong Hing
Designation Chairman and Managing Director
Description (Please provide a detailed description of the event in the box below - Refer to the Online help for the format)
Please see attached:
Presentation slides in relation to Q1FY2018 Results.
Additional Details
For Financial Period Ended 30/06/2017
Attachments VHL- 1QFY2018 Results-Presentation Slides.pdf
Total size =1389K
Page 1 of 1Financial Statements and Related Announcement::First Quarter Results
11-Aug-17http://infopub.sgx.com/Apps?A=COW_CorpAnnouncement_Content&B=Announcem...
Q1FY18 Results Presentation
Note: This presentation is to be read in conjunction with the announcement issued on SGXNET on 11 August 2017.
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2
Important Notice
This presentation contains forward-looking statements which can be identified by the context of the statement andgenerally arise when the Company is discussing its beliefs, estimates or expectations. Such statements may includecomments on industry, business or market trends, projections, forecasts, and plans and objectives of managementfor future operations and operating and financial performance, as well as any related assumptions.
Readers of this presentation should understand that these statements are not historical facts or guarantees of futureperformance but instead represent only the Company’s belief at the time the statements were made regardingfuture events, which are subject to significant risks, uncertainties and other factors, many of which are outside of theCompany’s control. Actual results and outcomes may differ materially from what is expressed or implied in suchforward-looking statements.
The Company cautions readers not to place undue reliance on any forward-looking statements included in thispresentation, which speak only as of the date made; and should any of the events anticipated by the forward-lookingstatements transpire or occur, the Company makes no assurances on what benefits, if any, the Company will derivetherefrom.
Investor Relations Contact:
Name: Mr Gerald Woon Name: Ms Candy Soh
Email: [email protected] Email: [email protected]
Tel: + 65 6704 9288
Corporate Profile
At a Glance
• Electronic Manufacturing Services (“EMS”) player established in 1992 in Hong Kong
• Listed on Main Board of SGX on 28 March 2007
• Production facilities in Daya Bay & Danshui Town, Guangdong, PRC (60 minutes from Shenzhen)
• Auditors: PricewaterhouseCoopers
Integrated EMS Provider
• Engineering Design & Development
• Product Design & Deployment
• Plastic Injection Moulding
• Tool Design and Tool Fabrication
• Metal Stamping & Machining
• Printed Circuit Box Assembly and Box Build Assembly
• Supply Chain Management
Accreditations
ISO9001:2008, ISO14001:2004,ISO013485: 2003
TL9000 R5.5, TS16949: 2009, IPC J-STD-001
IPC-A-610 QML Class 3
Employees • As at 30 June 2017, around 4,000
Bloomberg Code VALUE.SP
Reuters Code VLUE.SI
ISIN Code BN2
Issued shares (M) 423.8
Mkt cap (SG$M) (4 Aug 2017) 349.7
Share price (SG cent) (4 Aug 2017) 82.5
Avg volume 3-mth ('000) 2,097
52 wk range (S$) (4 Aug 2017) 0.45 – 0.88
25.7%
74.3%
Shareholding
Executive Directors
Public Float
4
Business Model
A Premier Design and Manufacturing Partner
Proactive deployment of Design & Development capabilities
Integrated Manufacturing Services
•SMT•Wire bonding•FG assembly•Metal part machining•Injection molding•Tool design & fabrication
Engaging in Customers Value Chain
•Design for manufacturing•Design & build test fixtures•Rapid prototyping•Regulatory compliances•Supply chain management services
Design & Development
•Mechanical & electrical engineering design from concept to mass production•Better manufacturability with enhancedfeatures & lower cost•Software development•Industrial design
Value Add
2008 2009 2012 2014 2015 2017
Completed Phase 1 construction of
Daya Bay Facility
Opened Daya Bay Facility, acquired medical business
Celebrated 20th
anniversary with revenue crossing
HKS2 billion
Adoption of formal dividend policy
Received TS16949 certification
Received 2016 Above & Beyond –Pinnacle Award for Supplier Excellence
from Delphi
1992 2002 2003 2005 2007 2008
Headquartered in Hong Kong with manufacturing
facilities in Danshui Town PRC
Use of ROHS equipment and accredited with
TL9000
Adopted work cell management &
updated to ISO9001:2000
Became Philipspreferred supplier for its consumer lifestyle segment
Listed on SGX-Mainboard & commenced
construction for Daya Bay Facility
Became Phillips preferred supplier
for its Lighting segment
5
Key Milestones
6
Daya Bay Facility – Bird’s-Eye View
• Land use rights acquired in 2006 • Total site area > 110,000 sq m
• Ability to accommodate customers requirement for various volume, mix andcomplexity
• Customer base ranged from emerging enterprises in Northern American (low-volume complex custom product) to top global Multi-National Corporations(high-volume standards product)
7
Customer & Product Portfolio
Industrial & Commercial Electronics
Consumer Electronics
Industrial & Commercial Electronics
8
Transaction Printer for Slot, POS & Teller Station Machines
Thermal Label Printer for Industrial & Commercial Use
Printers Temperature Sensing Devices
Cold Chain Temperature Monitor for Industrial & Commercial Use
Electronic Thermostats
Nasdaq-listed Company Unit of a NYSE-listed MNC
Global Brand owned by NYSE-listed MNC Company owned by a UK PE Fund
9
Industrial & Commercial Electronics (Cont’d)
High Precision GPS for Industrial Use
Communication Products
Taiwan-listed CompanyToronto-listed Company
Company Based in North America
10
Industrial & Commercial Electronics (Cont’d)
Access Card Readers
Others
In-vitro Diagnostic Medical Equipment for Testing Human Tissue Samples
Electronic Products forAutomotive Industry
Tier 1 Automotive System Manufacturer
Data and media connectivity module
Consumer Electronics
11
15W and 40W Bug Zappers
PCBA for Shavers & Electric Toothbrushes for Consumer Use
Consumer Lifestyle Products
Subsidiary of Homax Group(Wholly-owned by PE firm)
Consumer Lifestyle Division of a Dutch MNC
Consumer Electronics (Cont’d)
12
Smart Lighting with IOT Features
Wireless lighting contain various LED specially chosen to produce wide range of intensities and over 16 million colours;Wirelessly controlled by mobile application
Lighting Division of a Dutch MNC
Q1FY18 Financial Highlights
13
Financial Highlights
HK$’M Q1 FY2018 Q1 FY2017 % Change
Revenue 695.7 477.5 45.7
Gross Profit 104.3 76.6 36.2
Gross Profit Margin 15.0% 16.0% -1.0% pt
Net Profit for the period
48.7 29.6 64.8
Net Profit Margin 7.0% 6.2% 0.8% pt
-12%-16%
-27%
-24%
-13%
9%
35%
44% 46%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
Q1FY16 Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18
Comparable sales growth%
15
Return to Revenue Growth%
Financial Highlights
Consumer ElectronicsIndustrial and Commercial Electronics
Revenue Contribution
34.6%
65.4%
Q1FY17
HK$313M
HK$165M
45.5%54.5%
Q1FY18
HK$379M HK$317M
Revenue Trend
17
1,581.4 1,653.3 1,473.0
824.6 987.1
165.0316.5
628.8
780.0956.3
1,128.3
1,287.8
312.5
379.2
-
500.0
1,000.0
1,500.0
2,000.0
2,500.0
FY13 FY14 FY15 FY16 FY17 Q1 FY17 Q1 FY18
Consumer Electronics Industrial & Commercial Electronics
2,429.3
477.5
695.7
HK$’ M
2,210.2
2,433.3
1,952.9
2,274.9
18
Quarterly Revenue
239.0141.0 164.4 165.0
261.1 270.9 290.1 316.5
287.5
293.5 277.5 312.5
312.6 316.7346.0
379.2
0
100
200
300
400
500
600
700
800
Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18
Consumer Electronics Industrial & Commercial Electronics
434.5
573.7
526.5
695.7
441.9477.5
636.1587.6
HK$’ M
54.2%47.3%
56.0%
37.3%42.7%
33.9%
8.5% 10.0% 10.1%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
FY16 FY17 Q1FY18
Europe
China & AsiaPacific
NorthAmerica
19
Revenue by Shipment Destination
77.0
70.5 71.576.6
83.5
91.0 90.6
104.3
32.225.2 29.5
29.6
38.1
42.943.5
48.7
14.6%
16.2% 16.2% 16.0%
14.6%15.5%
14.2%15.0%
6.1%5.8%
6.7%6.2% 6.6%
7.3%6.9% 7.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
0.0
20.0
40.0
60.0
80.0
100.0
120.0
Q2FY16 Q3FY16 Q4FY16 Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18
Gross Profit Net Profit GP% Net Profit Margin
20
Gross Profit & Net Profit Trend
72
6.6
80
8.5
85
7.3
93
8.6
99
1.2
74
0.3
99
2.7
98
1.7
1,5
92
.6 1
,91
9.4
47
7.9
50
5.8 6
89
.3
75
2.9
71
9.3
0
200
400
600
800
1000
1200
1400
1600
1800
2000
FY14 FY15 FY16 FY17 Q1 FY18
NAV Market Cap Net Cash balance
21
Market Capitalisation & Net Cash Balance
HK’M
Earnings Per Share & Dividends Per Share
22
23
.2
13
.6 15
.2
31
.1
33
.2
19
.9
36
.9 36
.4
29
.0
36
.8
7.8
4.5
7.0
14
.0
17
.0
8.0
20
.0
20
.0
20
.0
20
.0
6.1%
11.8%
7.7%
9.8%
11.9%
6.0%
9.8%
5.3%*
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17#
EPS * Dividend per share Dividend Yield
7.7%7.5%
# Quantum of dividend has increased by 10% under 1:10 bonus issue
We are committed to formal dividend policy of 30-50% payout ratio HK cents
SharePrice* (S$) 0.21 0.07 0.15 0.21 0.21 0.19 0.30 0.43 0.41 0.68
DividendPayout 30% 30% 42% 41% 47% 37% 49% 50% 63% 55% *
* Adjusted for 1:10 bonus issue
23
Summary of Cash Flows
HK$’000 Q1FY18 Q1FY17
Operating Activities
Net cash generated from operating activities 22,907 47,565
Investing Activities
Net cash (used in)/generated from investing activities (58,219) 8,326
Financing Activities
Net cash generated from financing activities 2,086 -
Net (decrease)/increase in cash and cash equivalents (33,226) 55,891
Effect of foreign exchange rate changes (382) (212)
Cash and Cash equivalents
At beginning of the period 752,941 689,260
At end of the period 719,333 744,939
Balance Sheet & Key Ratios
24
HK$’M Q1 FY18 FY2017
Working capital
Inventories 358.1 291.9
Trade Receivables
562.6 486.3
Trade Payables
(570.1) (484.7)
350.6 293.5
Net CurrentAssets
727.8 734.0
Net Cash 719.3 752.9
Net Assets 991.2 938.6
Turnover Days Q1 FY18 FY2017
Inventory 55.3 55.1
TradeReceivables
73.8 78.0
Trade Payables
(88.0) (91.5)
41.1 41.6
Key Financial Ratios
25
# Share price as at respective period or year end date
*Restated/adjusted based on 1:10 bonus issue
SGD/HKD Ex rate: Q1 FY2018: 5.66;FY2017: 5.56;
Q1 FY18 FY2017
Price (SGD) # 0.80 0.745
NAV per share (SGD)*
0.42 0.40*
Cash per share (SGD)*
0.30 0.32*
Cash to Mkt Cap ratio
37% 47%
Q1 FY18 FY2017
Current ratio 1.7 1.8
ROE 19.7% 16.4%
ROA 9.8% 8.5%
PB ratio 1.92 1.68
26
Business Outlook
Overview• Strong performance across all segments in Q1
• Revenue increased by 45.7%
• Profit attributable to owners of the Company rose 64.8%
Capturing CE opportunities
• Strong growth in Q1 mainly driven by the smart LED lighting products with IOT features
• Remains optimistic on the growth prospects of the smart LED lighting product as IOT devices are gaining more popularity
Capturing ICE opportunities
• Growth driven by in-car connectivity modules used in the automotive industry and printers
• Recently qualified by another automaker of served by an existing automotive customer
27
Business Outlook
Corporate strategy &
Macro environment
• Ride on successful penetration into the automotive industry to pursue further opportunities in this industry and expand product portfolio and customer base
• Like most manufacturers, operating in an uncertain macro-economic environment
• Be mindful of the possible business impact such as fluctuations in raw material price and lead time in procurement
Reader should refer to section 10 of the Results Announcements for the complete commentary at the date of the announcement ofthe significant trends and competitive conditions of the industry in which the Group operates and any known factors or events that may affect the Group in the next reporting period and the next 12 months.