Skyworth Group H1 net profit grows nearly 20%, gross profit margin increases to 19.7%

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Sep 01, 2019, 23:25 ET

SHENZHEN, China, Sept. 1, 2019 /PRNewswire/ -- Skyworth Group (00751.HK) released its 2019 interim results after-hours on August 27. The group booked turnover of 17.23 billion yuan (approx. US$2.4 billion) for the period, with gross profit margin increasing to 19.7% from 17.3% a year earlier. Profit before tax and net profit stood at 562 million yuan (approx. US$78.6 million) and 348 million yuan (approx. US$48.6 million) for the six months, up 46% and 20.4% year on year, respectively.

Skyworth’s smart electrical product line

During the period, the company invested 908 million yuan (approx. US$127 million) in the R&D of several high-quality smart products in a move to enhance competitiveness, up significantly by 20.6%. The company's financial position was further optimized, with book value of capital rising to 4.265 billion yuan (approx. US$596 million) as of June 30, 2019, a significant improvement of 28.7% from December 31, 2018.

In the first half, Skyworth Group continued to implement its transformation strategy: in the multimedia side of the business, Internet content revenue surged 39.3% from the same period last year, with activated smart TV users exceeding 38 million and the daily average number of active users reaching 13.85 million. The company aggressively leveraged its first-mover advantages by adjusting the color TV product portfolio and the customer database structure, accelerating the market penetration of OLED TV, and enhancing market share by rolling out high-end products to consolidate its position across the industry.

Driven by smart system technologies, the digital set-top boxes business grew, while smart home, IoT and security engineering segments were launched, opening up new growth paths.

Following the adoption of a strategy focused on the high end of the consumer electronics sector, the firm's smart electronics business received a general upgrade in terms of market positioning, brand, scale and price. The sales channels portfolio was further optimized, providing coverage across all sales channels from large chain home appliance stores to e-commerce sites and traditional shops in China's smaller towns and cities, giving a boost to the rise in both turnover and sales volume.

With technical, market and brand advantages, Skyworth is expected to fully benefit from actions undertaken by Chinese government at the beginning of the year to speed up the development of a nationwide 4K/8K UHD video industry.

SOURCE Skyworth