During the first half of the financial year, orders from the Group’s major markets, North America and Western Europe, dropped significantly amidst the global financial turmoil. The impact of tight credit funding in the market, and the fact that the Group’s supply chain has not been allowed to operate smoothly, have also contributed to the significant reduction in sales.
PROVIEW Chairman and Chief Executive Officer Mr. Rowell Yang Long-san said: “After a series of major blows, the future holds both survival-threatening challenges and new opportunities for PROVIEW. The organizational structure of the Group will be reshaped into three core segments, namely liquid crystal display (“LCD”) television sets (“TVs”) and monitors, lighting products, and mining. With continuous support from our banks, we have managed to get through a difficult time.”
In view of rapidly increasing demands for environmentally-friendly light-emitting diode (“LED”) lighting products, PROVIEW has speeded up the development of this new business stream which holds more promising prospects and earnings potential. Installations of production facilities have been completed in phases. The Group has achieved significant progress in procuring orders for city road lamps in the Central American region. It is also actively exploring business opportunities in China and overseas markets.
Delivery of the new super-slim product lines for LCD TVs and monitors with LED backlight commenced in September 2009. The modular structure of these display products has helped reduce significantly the number of spare parts and manufacturing man-hours required. The resulting production cost reduction, complemented by attractive product features such as super-slim light-weight design, crisp clear screen display and environmental friendliness in being energy-saving and mercury-free, enables the Group to become more competitive in winning customer orders, thereby expanding sales and improving profitability.
The Group is supported by a group of Mainland Chinese banks headed by the Bank of China. It continues to manage and control inventory movement, recovery of trade receivables, payments of costs, expenses and trade payables on the basis of a set of agreed operational procedures. Moreover, in view of the high profitability of the LED lighting business, it is expected that the banks will increase credit facilities and provide funding support for the Group’s new lighting business.
To ensure timely fulfillment of sales orders, the Group has worked together with strategic production partners in the past year to secure a smooth supply chain, and to sustain the production of parts and finished goods. In addition, the Group is also actively seeking strategic partnerships in sales and production in order to expand in China and international markets, so as to give full play to the Group’s brand, technical and sales channel advantages.
Sales of flat-panel digital TVs and LCD monitors decreased 86% and 84% year on year respectively to HK$243 million (2008: HK$1.74 billion) and HK$280 million (2008: HK$1.72 billion).
As at December 31, 2009, the Group held cash and bank balances (including pledged bank deposits) of approximately HK$224 million (June 30, 2009: HK$274 million). Trade and bills receivable decreased to HK$143 million (June 30, 2009: HK$282 million).
Financial Highlights
| Six months ended December 31, | ||
| 2009 | 2008 | |
| HK$ '000 | HK$ '000 | |
| Turnover | 593,751 | 3,901,746 |
| LCD monitors | 280,313 | 1,718,963 |
| CRT monitors | 19,847 | 151,425 |
| Flat-panel digital TVs | 243,230 | 1,741,333 |
| (Loss) before taxation | (761,108) | (1,327,734) |
| Net (loss) attributable to owners of the Company | (755,838) | (1,311,430) |
| Basic (loss) share | HK(97.91) cents | HK(169.87) cents |
About PROVIEW International
PROVIEW International Holdings Limited (HKEx: 334) is the world’s leading display devices producer. In response to market and industry trends, the organizational structure of the Group will be reshaped into three core segments, namely liquid crystal display (LCD) television sets and monitors, lighting products, and mining. The Group commands a global sales and distribution network with strong leverage of its world-class manufacturing facilities in China, Taiwan and Brazil. For more information, please visit www.proview.com.