Q Tech profits skyrocket to 520m yuanBusiness | Tereza Cai 12 Dec 2019
Camera modules provider Q Technology (1478) expects to see its net profit for 2019 jump by at least 33.7 times from 14.4 million yuan a year ago to between 500 million yuan (HK$554.87 million) and 520 million yuan.
The expected net profit increase is down to its improving gross profit margin on camera modules due to an increase in sales volumes and better product mix in the second half of 2019.
Despite a slight decrease in sales of fingerprint recognition modules, the gross profit margin of this segment improved year-on-year due to the significant enhancement of the product mix.
Q Technology said the labor cost has improved as a result of upgrading of production automation.
Newmax Technology, an associated company of Q Technology, has significantly improved its management for the period from January to November 2019 and has recorded a profit, which has not been finally audited.
On the other hand, however, the exchange rate of the yuan against the US dollar fluctuated fiercely from January due to the influence of trade disputes, which has impacted on the operating profit of Q Technology, the company added.
Shares in Q Technology (Group) increased 1.3 percent to HK$12.44.
Separately, Sino Hotels (1221) warned it is likely to see a 94-percent slide in net profit for the five months through to November.
It expects its interim net profit for the six months ended December to be far lower than that in the same period last year.