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Irico Group Electronics Company Announces its 2008 Annual Results, Annual Profit Increased by 47.42%

Post Time:Mar 27,2009Classify:Company NewsView:293

The board (the "Board") of directors (the "Directors") of IRICO Group Electronics Company Limited ("IRICO Electronics" or the "Company") is pleased to announce the audited consolidated results of the Company and its subsidiaries (collectively, the "Group") for the year ended 31 December 2008.

Financial Summary

-The sales revenue of the Group in 2008 was RMB3, 541,920,000, representing an
increase of 5.45% from last year.

-Operating profit was RMB158, 870,000, representing an increase of 73.59% as
compared to last year.

-Gross profit margin was 17.75%, representing an increase of 7.15 percentage points as compared to the previous year.

-Profits attributable to equity holders amounted to RMB95, 324,000, representing an increase of 47.42% from last year.

During the reporting period, the sales revenue of the Group was RMB3, 541,920,000, representing an increase of 5.45% from 2007. Operating profit was RMB158, 870,000, representing an increase of 73.59% as compared to last year. Gross profit margin was 17.75%, representing an increase of 7.15 percentage points as compared to the previous year (2007:10.60%). Profits attributable to equity holders amounted to RMB95, 324,000, representing an increase of 47.42% from last year.

Reviewing the performance in year 2008, Mr. Xing Daoqin, Chairman of IRICO Electronics said, "The Group witnessed rapid growth of its new operations during 2008, a critical year to aggress on all fronts for strategic transformation. By virtue of tenacious efforts of our management and staff, we had overcome difficulties and secured desirable operating results for 2008. During the reporting period, remarkable progress and breakthrough were made in new operations including electronic glass and luminous materials. CPT business remained stable, contributing steady revenue and cash streams to the Group. Besides, the Group stepped up strategic planning and study, while enhancing financing capacity and risk management to ensure its healthy development."

Display Devices Businesses

Colour picture tube ("CPT") and its components business: under the backdrop of the global financial crisis and continuous impact on flat panel display (FPD) devices, the Group sold a total of approximately 14,809,000 units of CPT in 2008. The Groups output volume of CPT increased by 2.3% as compared to the corresponding period last year, which accounted for approximately 29.6% of the total output volume of the CPT manufacturers in China, securing its leading position in the domestic industry. The Groups global market share reached approximately 16.4%, representing an increase of 2.6% as compared to last year, ranking as one of the leading CPT manufacturers in the industry. The Group continued to intensify the strategic thinking of reinforcing CPT and exploring new businesses. By adopting the Groups three major strategies of overall cost control, marketing-driven and technology innovation initiatives, the competitiveness in the CPT sector was further enhanced.

FPD business: On 30 December 2008, IRICO Display Devices Co., Ltd. a subsidiary controlled by the Company, and Shenzhen Hongyang Industry & Trade Co., Ltd. a wholly-owned subsidiary of IRICO Group Corporation entered into an agreement to construct the production lines of OLED, the third generation display device. Upon completion of phase project, a production scale of 12 million pieces of OLED display panels per annum (in terms of 2.2-inch products) is expected to be achieved. Currently, construction of the project is in progress. In addition, the plasma display panel (PDP) and module project jointly established by the Company and Sichuan Changhong Electrical Group Co., Ltd. has progressed smoothly and batch production is expected to launch in 2009.

Electronic Glass Business

During the reporting period, the Group had achieved key breakthroughs in its thin film transistor liquid crystal display ("TFT-LCD") glass substrate project. At present, quality product ratio is rising constantly. Exchanges about product certification and technology specifications between the Group and downstream panel manufacturers have reached certain development stage. Further improvements in capacity and quality are expected to be seen in 2009.

The Group also intends to initiate construction of phase II of the TFT-LCD glass substrate project to achieve stronger economies of scale and competitiveness. Leveraging its own glass-making resources and technological advantages, the Group invested RMB250 million in the construction of photovoltaic glass production line with an annual capacity of 5,026,000 square meters. The construction of the project commenced in January 2009.

Luminous Materials Business

In 2008, overseas orders of energy saving lamp plunged as a result of the financial crisis. As the energy saving lamp industry was adversely affected on a comparatively large scale, the market of energy saving lamp phosphor had shrunk by a certain degree. After employing various effective measures, the Group witnessed a minor boost in the sales of energy saving lamp phosphor. The Groups market share in the PRC increased to 23%, maintaining its leading position domestically and allowing continuous improvement in product quality. During the reporting period, client promotional work for new products such as cold cathode fluorescent lamp ("CCFL") phosphor, PDP phosphor and lithium battery powder achieved certain progress which offered potentials for further development in the future.

Looking forward 2009, Mr. Xing said, "All new businesses of the Group are to experience rapid development and the strategic transformation promises us of fruitions. The Group will strive to maintain its leading position in the CPT business, and thereby safeguard any further strategic transformations of the Group. And at the same time, the Group is rapidly shifting its business focus to booming areas such as the new FPD devices and such abundant resources such as components, electronic glass, luminous materials and metallic components. Capitalising on the background as a state-owned enterprise, and technology, human resources and customers that we accumulated for years, the Group is positioned to experience rapid development in all its business and to enhance its profitability and sustainable development capacity as all new operations grow. With our strategic transformation taking shape, we believe a brighter future is well ahead of us, such that we can bring promising returns to shareholders."

Source: IRICO Group Electronics Company LimitedAuthor: shangyi

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