The Group continues to enjoy healthy financial position. As at March 31, 2002, the Group had cash in hand of HK$148 million, with current and gearing ratios standing at 3.4 times and 1.5% respectively.

During the year, Kin Yat's toys operation had to deal with severe price reduction pressure, but despite the 11% drop in toys revenues to HK$562,473,000, operating profits from this division rose 11% to HK$81,030,000.

"We attributed this notable improvement in profitability to our strategic relocation of part of production base in Shenzhen to a lower-cost location at Shaoguan, China. Meticulous optimization of production schedules to off-peak periods and the stablization of materials supply also enabled us to budget and control our costs effectively," noted Mr Raymond Cheng Chor-kit, Chairman, Kin Yat Holdings.

The Group remains relentless in expanding revenue sources through pro-active product and business development initiatives. One of the Group's strategies is to refine its focus to high-end toys with more sophisticated electronic functions and of higher margins. "We have reasonably positive expectation of market feedback to certain licensed toy products related to blockbuster movies recently released," continued Mr Cheng.

Turnover of the motors operation advanced 22% to HK$180,676,000 (including sales to the Group of HK$5,773,000) for year in review and segment result from operating activities was HK$42,346,000. Mr Cheng said: "We are very encouraged by the motors division's performance in an unfavorable market environment, further proving the success of our two-pronged focus on toys and personal care products."

Motors division's encouraging turnover and profit growth was primarily attributable to increasing market demand of sophisticated motors-powered toys and the emergence of a variety of motors for electronic personal care products. The Group anticipates a higher share of income contribution from the personal-care products sector as new products continue to the market at a rapid pace.

The Group will increase its monthly capacity of motors to 26 million units from the current 20 million units when the Phase Three expansion plan in Shaoguan, China completes by the end of 2002.

The Group's latest endeavour into CDR manufacturing is also making satisfactory progress. The planned relocation of its production facilities from Hong Kong to Shaoguan, China, will commence in the second half of 2002, with six production lines to be installed and in operation in August 2002.

Mr Cheng concluded: "We will make good use of this industry downtime to further rationalize our production base in the more cost efficient Shaoguan, China, in preparation for the next upswing in the economic cycle; and also to delve into our business strategy to tap into the potential of other market segments. Our motors division is a very encouraging precedent of our business diversification initiatives, which will continue to bring us healthy growth."

Year ended March 31,
	2002	2001
	HK$ '000	HK$ '000
Turnover	785,804	811,561
Toys and related products	592,473	628,828
Motors (sales to external customers only)	174,903	134,952
Electrical household appliances	48,428	47,781
Net Profit Attributable to Shareholders	98,034	84,692
Segment Results from operating activities
Toys and related products	81,030	73,246
Motors	42,346	32,501
Electrical household appliances	1,442	1,730
Final dividend per share	HK7 cents	HK7 cents
Earnings per Share
- Basic	HK25.86 cents	HK22.42 cents
- Diluted	HK24.99 cents	HK21.81 cents

Issued by :
Kin Yat Holdings Limited

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