|Underlying Profit Decreased by 24.4% to HK$129.6 Million|
Declared Final Dividend of 5.8 HK Cents per Share
HONG KONG, June 10, 2019 - (ACN Newswire) - Grand Ming Group Holdings Limited (the "Company" and together with its subsidiaries, the "Group", stock code: 1271.HK) today announces its annual results for the year ended 31 March 2019 ("FY 2018/19").
- Recorded revenue of HK$613.4 million, a decrease of 56.9%.
- Recorded underlying profit, excluding the change in fair value of investment properties, decreased 24.4% to HK$129.6 million.
- Attained net profit of HK$149.0 million, representing a decrease of 13.3%.
- Declared final dividend of 5.8 HK cents per share.
- Stays optimistic to search for opportunities to expand the land bank for the property development business.
The consolidated revenue of the Group decreased 56.9% from HK$1,423.9 million for the year ended 31 March 2018 ("FY 2017/18") to HK$613.4 million for FY 2018/19, which was mainly attributable to dropped revenue from the building construction segment in which had been offset partially by the revenue increase on the sales of Cristallo properties in the property development segment. Yet the consolidated gross profit slightly decreased by 1.0% from last year to approximately HK$266.4 million (2018: HK$269.3 million). The gross profit margin was significantly improved due to recognition of sales of Cristallo properties and additional work done in a construction project.
The Group's underlying profit for FY 2018/19, excluding the increase in fair value of investment properties, amounted to HK$129.6 million, representing a 24.4% drop from HK$171.3 million in FY 2017/18. Underlying earnings per share was 18.3 HK cents (2018: 24.1 HK cents). Net profit for FY 2018/19 was HK$149.0 million, inclusive of an increase in fair value of investment properties of HK$19.4 million, representing a decrease of 13.3% compared to that of HK$171.8 million for FY 2017/18. Basic earnings per share were 21.0 HK cents (2018: 24.1 HK cents).
It is the Group's agenda to protect and grow shareholders' investments and share profits through dividends. For FY 2018/19, the Board continued to recommend to pay a final dividend of 5.8 HK cents per share. Together with the interim dividend of HK4.0 cents per share already paid, the total dividend for FY 2018/19 amounted to 9.8 HK cents per share, representing a payout ratio of approximately 53.7%.
For the construction business segment, its revenue decreased by 79.2% or HK$1,009.6 million, from approximately HK$1,274.5 million for FY 2017/18 to HK$264.9 million for FY 2018/19. The decrease was because the Kai Tak construction project had been substantially completed in the previous financial year leading to the lower percentage of revenue being recognised during FY 2018/19.
One of the key business strategy of the Group is to own, develop and lease out raised floor space of high-tier data centre buildings which offer stable income stream to the Group. The first high-tier data centre, namely iTech Tower 1, maintained a high customer utilisation and continued to contribute stable rental income to the Group while the second high-tier data centre, namely iTech Tower 2, also operated well and delivered revenue to the Group progressively. For FY 2018/19, the revenue of the lease of data centre premises increased by 5.0% or HK$7.2 million, from HK$145.0 million for FY 2017/18 to HK$152.2 million for FY 2018/19. The increase was reflected by increased solid contribution of the iTech Tower 2 for FY 2018/19.
For the property development business, the site formation and foundation works of the Group's first property development project situated at Sai Shan Road, Tsing Yi, New Territories, are progressing well as planned. The development consists of a gross floor area of approximately 400,000 square feet, providing around 780 units in two residential towers. Construction is expected to be completed in early 2022. In April 2019 the Group had applied for presale consent of this project and is now pending for approval.
"Cristallo", another property development project of the Group, is located at No. 279 Prince Edward Road West, Kowloon. It is a luxurious low-density residential building located in the traditional luxury district of Kowloon and comprises 18 residential apartments. The project was acquired as the en-bloc residential building in October 2017 and has been well received by the market since its launch for sales in April 2018. During FY 2018/19 sales and delivery of two apartments had been completed. Revenue of HK$191 million was recognised accordingly. The Group also achieved an aggregate contract sales of approximately HK$425.6 million by entering provisional sales and purchase agreements in respect of sales of ten apartments which are expected to be completed between July 2019 and October 2021.
Looking forward, the Group maintains an optimistic view on the property development market and will continue to actively seek and identify suitable opportunity to expand the land bank though the global business environment at present was clouded by the recent Sino-US trade frictions.
Mr. Chan Hung Ming, Chairman and Executive Director of Grand Ming Group Holdings concluded, "In the coming year, the Group targets to sell the remaining units of the Cristallo project, while preparing for the launch of the presale of our Tsing Yi project to the market. As for the data centre business, our business initiative remains consistent - on the one hand to keep on upgrading our data centre infrastructure and strengthen our supports to the tenants, on the other hand to search for opportunities to develop new data centres outside Hong Kong. Our strategy in construction business remains prudent in midst of increasingly immense competition, we will eye on bidding only new construction projects with reasonable profit."
About Grand Ming Group Holdings Limited (Stock code: 1271.HK)
The Group is principally engaged in the business of building construction, property leasing and property development. As a local wholesale co-location provider of high-tier data centres, the Group is one of the dedicated service provider in Hong Kong which owns and uses the entire building for leasing to customers for data centre use. Its clients include multinational data centre operator, telecommunications company and financial institutions. With more than 20 years of experience in the construction industry, the Group also provides building construction services as a main contractor, and is involved in residential property development projects with prominent local developers, as well as offering alteration, renovation and fitting-out services for existing buildings in Hong Kong. Furthermore, the Group owns a land in Sai Shan Road, Tsing Yi for the purpose of developing a residential project with gross floor area of 400,000 square feet, as well as an en-bloc residential building in Prince Edward Road West, Kowloon being named as "Cristallo".
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