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>> Cut off the gross profit of 425 million display and touch business Dongshan Precision first-half net profit growth of 117.93% 4th,August,2018
On August 1, 2018, Dongshan Precision released the "2018 Semi-annual Report", which showed that the operating income in the first half of 2018 was 7.212 billion yuan, an increase of 17.83% over the same period of the previous year; The profit was 260 million yuan, an increase of 117.93% over the same period of the previous year, and the realized earnings per share was 0.24 yuan.
Cut off the gross profit of 425 million display and touch business Dongshan Precision first-half net profit growth of 117.93%
Dongshan Precision Co., Ltd. expresses its commitment to providing technology-leading core devices for the smart interconnected and interoperable world, providing a full range of smart interconnect solutions for customers worldwide, covering printed circuit boards, electronic devices and communications equipment. Consumer electronics, telecommunications, industrial, automotive and other industries. At present, the company is one of the top five flexible circuit board manufacturers in the world and one of the well-known suppliers of base station antenna communication equipment components in the industry. LED has a leading market share in some small-pitch segments. During the reporting period, the company's performance drivers were mainly driven by the increasing demand from customers and the gradual release of new production capacity. The revenue and profit contribution of the company's FPC products and other products increased rapidly.
Cut off the gross profit of 425 million display and touch business Dongshan Precision first-half net profit growth of 117.93%
Among them, printed circuit board accounted for 37.54% of operating revenue, up 36.61% year-on-year; LED and its display devices accounted for 14.76% of operating revenue, down 20.78% year-on-year; touch panel and LCM module The proportion of operating income was 27.90%, an increase of 25.88% year-on-year; the proportion of communications equipment components and other operating income was 19.65%, an increase of 20.11%.
Dongshan Precision believes that in the first half of the year, the company will focus on the main business, strengthen and expand, and cultivate a strong endogenous growth momentum, and actively build a reasonable product and customer advantage by promoting mergers and acquisitions of overseas high-quality industries. On the other hand, it began to divest non-core business, improve quality and efficiency, lightly install, and honed the industry team with more core competitiveness, striving to make the company's industry position more prominent and its business performance more stable.
On July 10, 2018, Dongshan Precision announced that it intends to further optimize the industrial layout, integrate company resources and improve the company's operational efficiency by selling non-core business-related assets such as large-size display business and touch panel business. The underlying assets of the transaction include the company's large-size display business and touch panel business-related assets. The operating entities of the above-mentioned businesses are all 100% directly or indirectly controlled subsidiaries of the company.
Dongshan Precision said that the large-size display business is part of the LED and display device business. Dongshan Precision has formed a large-size display business system through continuous investment of its own funds, including large-size backlight modules, large-size complete machines, and computer displays. And related upstream sheet metal business; touch panel business by the company in February 2014 through mergers and acquisitions, the new touch panel business. However, the technology update of the touch panel industry is iterative and the demand for fixed assets is high. In order to realize the business strategy of focusing on the main business, Dongshan Precision plans to allocate core resources in the field of printed circuit boards that have developed rapidly in recent years. It is proposed to divest the touch panel business and dispose of related assets.
On July 26, Dongshan Precision issued another announcement to purchase the NASDAQ-listed company FlexLtd in cash. Subordinate PCB business related entity transactions have been completed. FLEX's PCB manufacturing business related entities, collectively known as Multek. Specifically, it includes five production entities in Zhuhai, two trade entities in Mauritius and Hong Kong, and four holding entities in the British Virgin Islands and Hong Kong. Upon completion of the acquisition, Dongshan Precision will directly or indirectly hold 100% of the total of 11 companies including Zhuhai Chaoyi Electronics, Zhuhai Chaoyi Technology and Zhuhai Chaoyi Industrial. The underlying transaction consideration for the transaction was $292.5 million.
FLEX is a US NASDAQ listed company. Headquartered in Singapore, it is a world-renowned electronics manufacturing service provider, providing customers with a comprehensive range of services from concept to scale to production (SketchtoScale), including creative design, industrial design, product manufacturing, supply chain services and total solutions. It has hundreds of subsidiaries in more than 30 countries around the world, and its business covers 12 industries including communications, automotive, internet, medical and energy.
In fact, Dongshan Precision's two businesses have brought relatively lucrative profits in the first half of the year. LED and its display devices accounted for 14.76% of operating revenue and gross profit of about 166 million yuan; Panels and LCM modules accounted for 27.90% of operating revenue and gross profit of approximately 259 million yuan. Together, the two provided Dongshan Precision with a gross profit of approximately 425 million yuan in the first half of the year.
The outside analysis Dongshan Precision began to streamline its business content, and the main purpose of re-purchasing FLEX's PCB business is to focus most of its resources on the future 5G market, and to deepen the advanced circuit board business with high technical threshold. At present, the consumer electronics industry chain has entered the market from the incremental market to the stock market. In addition, the display and touch industry is a labor-intensive and technology-intensive integrated business. The operation management is far less simple than the current 5G business market focused by Dongshan. These Dongshan Precision are such a big move to abolish the real cause of the touch business.
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