China Display Optoelectronics Technology Holdings Limited Announces 2019 Annual Results

• Driven
  by Orders of First-tier Brand Customers
• Overall
  Sales Volume Increased by 83.5% YOY
• Revenue
  Increased to RMB5,456 million
• Presence
  Expanded in Medium-sized Market

 

 Financial Highlights (Audited)

	Twelve months ended 31 December
(RMB ‘000)	2019	2018	Change
Revenue	5,455,790	5,280,861	+3.3%
Sales volume (‘000 units)	110,787	60,384	+83.5%
Gross profit	186,579	248,257	-24.8%
Profit attributable to owners of the parent	52,448	81,782	-35.9%
Basic earnings per share (RMB cents)	2.51	3.95	-36.5%

HONG KONG, CHINA – Media OutReach – 26 March 2020 – China Display Optoelectronics Technology
Holdings Limited (“Ch
Display Opt” or the “Company”, together with its subsidiaries, the “Group”;
HKSE stock code: 334) today announced its annual results for the twelve months
ended 31 December 2019 (the “Review Period”).

 

During the Review Period, the Group
recorded a revenue of RMB5,456 million, representing a year-on-year increase of
3.3%. Driven by the orders from
first-tier brand customers, the Group’s overall sales volume
rose significantly by 83.5% year-on-year to 111 million units. The Group
launched the processing business in June 2019. During the Review Period, the
sales volume of processing business accounted for 42.2% of the total sales
volume, with its revenue
reaching RMB508 million. As the processing business can reduce the Group’s
procurement and inventory management costs, as well as mitigate the risks
caused by fluctuations in raw material costs, it helps to stabilise the Group’s
cost structure. With that in mind, the Group will gradually increase its
proportion of processing business where practicable. Among the non-processing
products, the revenue of laminated LCD module products decreased by 3.4%
year-on-year to RMB4,231 million and the revenue of non-laminated LCD module
products decreased by 20.4% to RMB716 million. During the Review Period, the
Group has successfully qualified as the supplier for the global top smartphone
brands, including Samsung, Huawei, Xiaomi, OPPO and vivo.

 

The Group has actively devoted its
efforts to the research and development of new products and new technologies to
increase the sales proportion of mid-to high-end products. It has been striving
to deepen its cooperation with TCL China Star Optoelectronics Technology Co.,
Ltd* (TCL華星光電技術有限公司, together with its subsidiaries, “TCL CSOT”) to develop various
customised products, including a number of high-end full-screen module
products, such as slim bezel modules, high-frame rate screens and 5G. During
the Review Period, the Group’s full-screen products accounted for approximately
90% of the overall sales volume and the proportion of the sales volume of LTPS
products increased from 64% for the same period last year to 87%.

 

In order to fully optimise production
line efficiency and enhance management innovation and decision-making
capabilities, the Group has gradually developed its smart factories. The
production line renovation in Huizhou has been completed during the Review
Period. The Group’s overall production capacity for smartphone increased by 38.7%
year-on-year. Concurrently, the Group has actively expanded the production line
of medium-sized display modules in line with the direction of industry
developments. The Group has also capitalised on high-growth market segments
such as smart home, high-end laptop, electronic education and automotive to capture
the development opportunity in these markets. The shipment volume of smart
home-related products in the full year reached 4.5 million units, representing a year-on-year increase of
837%. In the automotive segment, the Group has launched interactive touch
automotive display modules with slim bezel in small batches.

 

Looking ahead, the management of Ch Display Opt said, “Given the country and the world
are in a state of high alert to combat and control the coronavirus (COVID-19)
outbreak, the Group has adopted a series of measures to prevent and control the
epidemic. At the same time, the Group has actively negotiated with strategic
suppliers and logistics partners to find suitable solutions to reduce related
risks. The Group will fully leverage its own advantages in order to reinforce
its partnership with first-tier brand customers. In addition, the Group will
continue to pay close attention to the medium-sized display markets to further
expand its market share horizontally. On the other hand, the Group will also
actively reduce costs and increase efficiency to maximise production efficacy
and effectiveness. In the long run, the Group remains cautiously optimistic
about the development prospects of the display module business and is confident
that it will further enhance its competitiveness by improving the industrial
value chain and enhancing its strengths in technology and scale.”

The
Group’s revenue and sales volume by product segment and their respective
year-on-year change during the Review Period are as follows:

	Twelve months ended 31 December
	2019	2018	Change (%)
Revenue (RMB’000)
Sale of TFT LCD module
–       Non-laminated modules	716,460	900,028	-20.4
–       Laminated modules	4,231,497	4,380,833	-3.4
Processing TFT LCD module
–       Non-laminated modules	42,843	–	N/A
–       Laminated modules	464,990	–	N/A
Total	5,455,790	5,280,861	+3.3
Sales Volume (‘000 units)
Sale of TFT LCD module
–       Non-laminated modules	15,897	18,788	-15.4
–       Laminated modules	48,171	41,596	+15.8
Processing TFT LCD module
–       Non-laminated modules	5,320	–	N/A
–       Laminated modules	41,399	–	N/A
Total	110,787	60,384	+83.5

About China Display Optoelectronics Technology (334.HK)

Headquartered in China, China Display
Optoelectronics Technology Holdings Limited (HKSE stock code: 334) is one of
the major providers of small-to-medium-sized display modules in the region. Ch
Display Opt engages primarily in the research and development, manufacturing,
sales and distribution of LCD modules mainly for devices on an ODM basis.
Smartphone LCD module products of Ch Display Opt are welcomed by domestic and
overseas manufacturers, according to IHS MARKIT data, the company ranked No.5 in terms of handset products’ sales volume among
Chinese display module makers in 2019.

 

For more
information, please visit its website at www.cdoth8.com.