Furniture maker's profit rises 16pc

Sofa maker Man Wah (1999) said its net profit for the year ended March 31 grew by 16.8 percent year-on-year to HK$2.25 billion, with a final dividend of 17 HK cents.

Revenue during the period jumped by nearly 28.6 percent to HK$21.79 billion, it said in a filing yesterday.

Goss profit margin inched up 0.6 percentage points to 36.7 percent, but profit margin slid 1.2 percentage points to 10.5 percent due to a 34.4 percent increase in the selling and distribution expenses.

Founder and chairman Wong Man-li said at a press conference that he was not happy with the lower profit margin.

Wong said the net profit margin should range from 12 percent to 18 percent, and he attributed the decline to the recent business expansion, the rising prices of raw materials and shipment, and the pandemic.

On the bright side, with the depreciation of the yuan and the now-stabilized raw material costs, coupled with the firm's cost controlling measures, Wong said the profit margin for the export business "has improved since the last two months."

Separately, electronic learning product maker VTech (0303) reported a 25.2 percent decline in net profit to US$173 million (HK$1.34 billion) for the year ended March 31 and proposed a final dividend of 51 US cents.