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Public company info - Kam Hing International Holdings Ltd. , 02307.HK
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Kam Hing International Holdings Ltd., 02307.HK - Company Profile
Chairman Tai Chin Chun
Share Issued (share) 870,000,000
Par Currency Hong Kong Dollar
Par Value 0.1
Industry Textile & Apparels
Corporate Profile Business Summary: The Group is principally engaged in the production and sale of knitted fabric, dyed yarn and garment products and provision of related subcontracting services. Performance for the year: The overall revenue for 2019 recorded a year-on-year decrease of 6.5%, from HK$4,651.0 million in 2018 to HK$4,350.7 million in 2019 with gross profit increased by 1.8%, from HK$580.7 million in 2018 to HK$591.1 million in 2019. Gross profit margin recorded an increment of 1.1 percentage points from 12.5% in 2018 to 13.6% in 2019. Profit attributable to ordinary equity holders of the Company for the Year amounted to HK$60.1 million, representing a decrease of 17.4% from HK$72.8 million in 2018. The basic earnings per share for the Year was HK6.9 cents, decreased by 17.9% when compared with HK8.4 cents in 2018. Business Review： For the Year, revenue generated from the fabric business and garment business accounted for 90.6% and 9.4% of the overall revenue respectively. The Group’s two production plants in Enping and Nansha in China continued to manufacture knitted and functional fabrics during the Year, while the factories in Cambodia manufactured garment products. During the Year, the fabric business has suffered from the sluggish demand resulted from the weakened global market sentiment amid the trade war. The China market competition has also become intense as Chinese exporters have turned to the domestic market to hedge against the global economic swings. As a result, revenue of the fabric business decreased by 11.4% year-on-year for 2019. On the other hand, the garment business achieved a growth of 99.5% year-on-year as the Cambodia production base had turned profitable for the Year, despite that it had only established for a short period of time since 2017. The set-up of the Cambodia base not only provided extended values to the Group’s existing customers, but also expanded the geographical coverage for new businesses. Encouraged by such performance, the Group is building its own production plant in Cambodia to further capture the growth opportunities in the booming garment export market in South East Asia. A self-owned production plant would allow greater production capacity and incorporation of more sophisticated production technology and stronger research and development capabilities. Such factors are essential to attract global customers with higher margins and tendency for bulk purchases. In light of the ongoing concerns of geopolitical risks, the Group has started the planning for a new factory complex in Nam Dinh Province, Vietnam to provide a one-stop textile manufacturing solutions outside China. The construction of infrastructure is scheduled in 2020 and is expected to complete in the first half of 2021. The trial production will commence in 2021. Prospects: Looking ahead, the U.S.-China trade war has abated following the signing of the initial phase of U.S.-China trade agreements. The Group remains prudent about the outlook of the textile and garment industry, as the outbreak of the Covid-19 pandemic would undoubtedly disrupt daily lives and business activities around the world in 2020. In support of official pandemic prevention and containment policies, many manufacturing plants in Mainland China suspended their operations for an extended period of time. Traffic and travel controls have caused shortage in labour in the supply chains for most of the sectors. Wholesalers and retailers that rely on supply chains in China would consequently be affected inevitably. However, it is expected that the impacts brought about by the pandemic will not be permanent. The Group will closely monitor the situation and deploy necessary measures to mitigate the impact on its annual production output and product delivery. In the meantime, tightened environmental regulations in mainland China and fierce competition from other developing regions in Asia may cause another round of market consolidation in the textile manufacturing and export market in China. Industry players that are unable to weather these impacts may be eliminated. To remain competitive during this downward economic cycle, the Group is determined to pursue self-enhancement and internal optimization in 2020 by further diversifying client mix to mitigate regional risks, accelerating the operations set up in Cambodia and Vietnam, streamlining production and internal procedures to reduce operating expenses and thoughtfully monitoring and reacting fast to the market dynamics. Considering the uncertainties of global economic outlook, the Group decided to postpone the residential property development in Enping of China. This decision will allow the Group to focus its resources to develop the existing and profit-making operations in its core businesses and to stay financially strong to maintain stable development and profitability in 2020. As a token of support to the Company during this difficulty time, all executive Directors have voluntarily waived 10% of their respective salaries commencing from February 2020 until the coronavirus pandemic is under control.

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