Hi-P International's Q3 profit jumps 26.3% to S$30.7m

MAINBOARD-LISTED Hi-P International on Thursday reported a 26.3 per cent jump in net profit for the third quarter to S$30.71 million, from S$24.32 million in the year-ago period.

Revenue for the three months ended Sept 30, 2016, was down 1.7 per cent to S$387.34 million, from S$394.18 million one year ago.

The company - a contract manufacturer of smartphones, tablet computers and other consumer electronics - recommended an interim dividend of 0.4 Singapore cent per share for the period, up from 0.3 Singapore cent in the year-ago period.

Earnings per share (EPS) for Q3 were 3.76 Singapore cents, up from 2.98 Singapore cents during the same period last year.

For the nine months, net profit was S$25.99 million, up more than 900 per cent from S$2.56 million in the same period last year. Revenue was down 4.1 per cent to S$948.29 million, from S$988.64 million. EPS was 3.19 Singapore cents, up from 0.31 Singapore cents one year ago.

Yao Hsiao Tung, Hi-P International's executive chairman and CEO, said that "despite difficult market conditions", the company's revenue has remained stable as "we have the right platform, systems and dedicated staff to mitigate the challenges".

He added that the company has maintained its strategy of tightening cost controls by adopting Hi-P's practice of driving operational efficiency and enhancing productivity. "These efforts led to an improvement in our gross margins while our total selling, distribution and administrative costs decreased significantly."

He said: "In addition, our efforts in improving cash cycle resulted in the continued ability to generate strong positive operating cash flows of S$151.6 million for the first nine months of 2016. This helped strengthen our balance sheet as our net gearing ratio improved to 14.2 per cent while reducing our net debt position to S$77.9 million.

"Going forward, we will intensify business development efforts in order to increase the order allocation from existing customers and secure new customers as we strive to diversify our customer base."