The Group continued to achieve revenue growth during the year, with turnover up by 9.4% to HK$8,562.8 million and gross profit increased by 18.3% to HK$2,231.1 million. Due to an increase in research & development ("R&D") expenses, profit attributable to shareholders was HK$1,006.1 million. Gross profit margin and net profit margin were 26.1% and 11.7% respectively. Basic earnings per share was HK16.82 cents.

The Board has recommended payment of a final dividend of HK3.8 cents per share for the year (2016: HK3.2 cents). Together with the already paid interim dividend of HK2.0 cents per share (2016: HK2.0 cents), total dividend for the year amounted to HK5.8 cents per share (2016: HK5.2 cents), representing a dividend payout ratio of 34%.

The Group maintained a solid financial position. As at 31 December 2017, it had pledged deposits balance and cash and cash equivalents of HK$1,274.2 million (31 December 2016: HK$1,131.2 million).

Mr. Wang Ya Nan, Chairman and CEO of Tongda Group, said, "As a world's leading solutions provider of high-precision components for smart mobile communications and consumer electronic products, we actively invested in R&D during the year to cope with the transition of handset designs and align with the upgrade and enhancement of waterproof specifications. Although the past year was full of challenges and changes, thanks to the strong technological "barrier" we have built over the years, allowing us to apply different technologies and craftsmanship to meet diverse product requirements, we have been able to keep enhancing our capabilities and at the same time maintain sustainable revenue growth over the years."

Business ReviewThe Group's products are mainly used in handsets, electrical appliances, notebook computers and automotives. The Group also operates an ironware parts division, and communication facilities and other businesses.

Electrical Fittings DivisionThis division primarily designs and produces consumer electronic products, including casings and components for handsets, electrical appliances and notebook computers. Revenue from the division for the year grew by 9.8% from HK$6,439.3 million in 2016 to approximately HK$7,070.1 million, accounting for 82.6% of the total turnover.

Handsets Turnover of the handset business increased by 10.1% to HK$5,911.3 million, making up 69.0% of the Group's total turnover. Matching customers' demand, the Group focused on producing metal casings with high price-performance ratio, large volume of shipment and simpler designs to help it grasp market share during the year. However, the relatively simple designs of the metal casings caused average unit price to drop slightly during the year, offsetting part of shipment growth.

In order to match with the physical demand on wireless charging and the 5G Antenna setting in the future, the Group has acquired the technology and production capacity of one-stop glass back covers production and realized small-scale mass production during the Year. It is also the first supplier to offer customers IMT uni-body casing that has a high price-performance ratio with similar appearance and function with glass. Furthermore, waterproof, dustproof and shockproof and High-precision components business enlarged its production rapidly during the Year. In the first half of the year, the Group has finished the research and development of new products and personnel training. Came the second half year, it mass produced related components including liquid-silicone rubber ("LSR"), precision insert molding and precision rubber molding parts for customers. As the varieties, quantities and complexity of the components for new handset models have notably increased, per handset revenue contribution has also increased accordingly.

Electrical AppliancesThe Group's electrical appliances business mainly offers casings and control panels for high-end household appliances. The sales of the segment was HK$578.3 million, representing 6.8% of the total turnover.

Notebook Computers Revenue from notebook computers rose by 23.8% to HK$580.5 million, representing 6.8% of the total turnover. The Group completed the spin-off and listing of its notebook and tablet casings manufacturing business on the Main Board of HKEX on 16 March 2018. Hence, looking ahead, it will no longer engage in computer hardware business, and will devote resources to developing its handset-related core business.

Ironware Parts, Communication Facilities and Other Business Revenue from ironware parts for the year was HK$469.7 million. Sales of communication facilities increased by 18.8% to HK$1,023.0 million. At the Group's effort to realize synergies brought by In-mold Lamination ("IML") technology and its surface treatment craftsmanship, the Group's automotive business founded a few years ago continued to grow during the year. The Group is currently negotiating with nine customers for over 20 projects, which highlighted another development milestone for the Group in the future.

Percentage of the total revenue by product type for the year ended 31 December 2017, as compared with the last corresponding period, as follows:2017 2016Electrical Fittings Division 83% 82%i. Handsets 69% 68%ii. Electrical Appliances 7% 8%iii. Notebook Computers 7% 6%Ironware Parts Division 5% 7%Communication Facilities and Other Business 12% 11%

ProspectsHandsets will remain as the Group's development focus going forward. The Group expects the main metal components to continue to make up the biggest proportion of its output in the future. And, as wireless charging gains popularity and in the advent of 5G handsets, mid-range and high-end handsets will gradually adopt designs using 2.5D/3D back casings made of glass and metal middle frames, whereas some mid-range handsets will adopt IMT uni-body casing that has a high price performance ratio and has similar appearance with glass. The Group has over 10 years of experience in film printing, customized mold production and surface decorating technology such as IMT and IML. Its leading technology will bring greater advantages to the Group.

As for the waterproof, dustproof and shockproof components and high-precision components business, in view of the strong demand from customers and the full operation of the new plant in 2017, the Group has planned to set up an additional plant during the second half of 2017 which is expected to be put into operation in mid-2018. The Group will strive to offer more high-precision components and waterproof, dustproof and shockproof components for handsets and other electronic products to customers. To that end, the Group has established a professional team to oversee market expansion and provide technology support, as well as cooperate closely with customers in North America.

Developing the automotive business is another long-term direction of the Group. Existing related R&D projects will commence production in the coming two years. The Group will actively approach domestic and joint-venture automotive brands to rally more customers and orders so as to enlarge its market share.

Mr. Wang concluded, "With more than 30 years' experience in handling surface decorating craftsmanship of different materials. Diversified processing craftsmanship and customized precision mould enable the Group to face the upgrade and changes in material, decorating effect, product variety in the market more effectively. In the coming year, we will work hard to improve our leading technologies, craftsmanship and capabilities so as to raise the Group's production efficiency and lay a solid foundation for our business in the ever-changing market. At the same time, we will continue to apply the advantages of our core technologies, IML technology and surface treatment craftsmanship to help us explore other potential businesses, with the aim of reaping maximum synergy."

About Tongda Group Holdings LimitedTongda Group is the world's leading solutions provider of high-precision components used in smart mobile communication and consumer electronic products. The Group has been listed on the Main Board of The Stock Exchange of Hong Kong Limited since 2000, under the Information Technology - IT Hardware category, and has been selected as a constituent stock in the Hang Seng Composite LargeCap & MidCap Index, Hang Seng Broad Consumption Index, Hang Seng Global Composite Index and the MSCI Global Small Cap Indices - China Index. The Group garners the DHL/SCMP Hong Kong Business Awards 2015- Enterprise Award and has been selected to the Forbes Asia's 200 "Best Under A Billion" list in 2016. Mr. Wang Ya Nan, Chairman and CEO of the Group has been named the winner in the technology category of EY Entrepreneur of the Year China 2016.

Leveraging its leading In-Mold Lamination ("IML"), waterproof, dustproof and shockproof components, and rubber parts business technology, as well as the stable and high-quality clientele, the Group has established a solid presence in the markets for handsets, electrical appliances and notebook computer casings and automotive decorative business. The Group is dedicated to satisfying customers' needs through establishing global service networks in various regions, with strategically located production bases in Shishi city, Xiamen, Shanghai and Shenzhen, as well as R&D centres in Shanghai and Taiwan.

For press enquiriesStrategic Financial Relations LimitedVicky Lee Tel: 2864 4834 Email: [email protected]^[1] Angela Ng Tel: 2864 4855 Email: [email protected]^[2]Angela Wong Tel: 2114 4953 Email: [email protected]^[3]Fax: 2527 1196

Topic: Press release summarySectors: Daily Finance, Daily News^[4][5] http://www.acnnewswire.com From the Asia Corporate News Network

Copyright © 2018 ACN Newswire. All rights reserved. A division of Asia Corporate News Network.

References

1. ^{^} [email protected] (www.acnnewswire.com)
2. ^{^} [email protected] (www.acnnewswire.com)
3. ^{^} [email protected] (www.acnnewswire.com)
4. ^{^} Daily Finance (www.acnnewswire.com)
5. ^{^} Daily News (www.acnnewswire.com)