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Man Wah's net profit soared 87.4% to HKD568m

Check out these 2 growth boosters.

According to Maybank Kim Eng, MW announced its FY3/13A results after the morning trading session yesterday. Net profit rose 87.4% YoY to HKD568m, which is above consensus’ HKD533m (range: HKD509-556m). 

Here's more:

EPS doubled to HKD0.629 as the company has repurchased shares (52.1m shares during FY3/13A or 5.85% of the company) during the year. Final DPS rose 1.6x to HKD0.18, translating into a FY DPS of HKD0.28 (+115% YoY) or a payout of 44% (FY3/12A: 41%) and historical yield of 3.4%.

The company has already made a positive profit alert on April 22nd that it expects the net profit to increase by 75% to 95% (HKD531-591m in dollar terms).

The net profit increase is contributed by 1) Mid-teens’ growth in sofa export and China sales, which accounted for 71.5% and 22.5% of the group’s revenue, supported by 20% YoY growth in store numbers in China to 894 by Cheers and Enlanda combined, and 13.7%/21.3% volume growth in export/China sales offsetting ASP drop of 0.7-3.9%;

2) Gross margin expansion to 36.3% at group level, versus 34% a year earlier as major production cost items such as metal,
fabric and wood dropped 0.4 to 4.5% YoY; Utilization also rose from 65.8% to 75% excluding the net effect on new capacity.  

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