SMT Holdings Sales on Upswing
SINGAPORE -- SMT Holdings' fortunes finally reversed for the better as sales and earnings rose in the contract assembler's fiscal 2014 first quarter. Revenue for the three months ended June 30 was HK$178.8 million ($23.1 million), up 10.7% from a year ago.
Profit attributable to shareholders was HK$2.1 million, up from a loss of HK$9.8 million (S$1.6 million) previously.
"Customer orders are gradually increasing due to improved confidence. We are seeing more consigned component assembly requirements in new customer orders. We will continue our cost-cutting effort to mitigate the increase in operating costs," the company said.
The revenue increase was mainly due to higher demand for industrial control products, the EMS company said. Industrial controls made up 90% of the company's sales in the quarter, up from 84% a year ago. Consumer sales is the company's only other significant source of revenue. Europe and the US make up 87% of the company's sales, up from 80% last year.
Gross margin was 20.5%, basically flat sequentially. The EU is still in a protracted recession. SMT noted the economic slowdown has accelerated in China, where it has its production sites, and taxes and government fees are on the rise.
"SMT continues to make progress in its recovery. However, due to external factors, we will face increasing challenges. We are intensifying our efforts to maintain the recovery momentum,” said Professor Chan Kei Biu, chairman and senior managing director.
SMT Holdings was a Top 50 global EMS company as recently as 2010, but went into bankruptcy shortly thereafter.
Ed.: 1 HKD = 0.128944 USD
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