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Friday, 11 March 2016, 11:16 HKT/SGT

Source: China Wood Optimization (Holding) Limited
China Wood Optimization Announces 2015 Annual Results; Revenue and Net Profit Both Increase Nearly 20%
Sales Volume of Processed Wood Panels Surges More Than 30%

HONG KONG, Mar 11, 2016 - (ACN Newswire) - China Wood Optimization (Holdings) Limited ("China Wood Optimization" or the "Group," stock code: 8099), an advanced new technology group engaged in processing, manufacturing and sales of wood products, has today announced its FY2015 annual results. Despite the slowdown in growth in the Chinese economy during the period under review, the Group has recorded a nearly 20% growth in both revenue and net profit, as processed wood panels, the Group's principal products, recorded a surge exceeding 30% increase in sales volume.

For the year ended 31 December 2015 (the "review period"), the Group's revenue amounted to approximately RMB609.9 million, up by 18.9% compared to the corresponding period last year. The growth was mainly attributable to the increase in sales of processed wood panels. The Group's profit attributable to equity shareholders grew around 17.9% to approximately RMB75.1 million during the review period.

Processed wood panels
Processed wood panels are the Group's principal products which are generally used to produce floor planks, doors and furniture. The profit margin is higher than that of processed finger joint wood panels. In order to utilize the production capacity more efficiently, the Group has been focusing on the production and sales of less-shaved processed wood panels, which require fewer production processes and reduce waste of production materials. In 2015, the sales volume of processed wood panels surged around 32.1% year-on-year to 170,692 cubic meters, while the sales revenue increased by 26.6% to approximately RMB588.9 million. Important contributing factors were the Group's successful expansion of its customer base, as a result of actively conducting sales and marketing promotion activities, participation in a number of major exhibitions, and the operations of the three sales offices in Beijing, Shanghai and Chengdu. Due to above factors, the percentage of sales of processed wood panels increased from about 90.7% in 2014 to 96.6% in the review period.

Processed finger joint wood panels
Cut-offs and small pieces produced during the trimming of processed wood panels are pressed and further processed before lamination to form processed finger joint wood panels. Processed finger joint wood panels are in the form of standard-sized boards and are generally used to produce wooden furniture, doors and window frames. The Group has strategically reduced the sales of processed finger joint wood panels and focused on processed wood panels as the latter involves fewer procedures and offers higher margins. As a result, the sales volume of processed finger joint wood panels decreased to approximately 4,861 cubic meters with sales revenue of approximately RMB21.0 million during the review period.

Ms. Yim Tsun, Chairlady of China Wood Optimization, said, "In 2015, the Group continued its efforts to conserve energy and reduce carbon, creating a green and sustainable environment and protect the environment. As for R&D, we continued to refine and improve our impregnation fluids, and studied the feasibility of using polar wood panels, as well as coniferous and broad leaf tree species to be our products. The Group also further raised the quality, credibility and reputation of our products, which helped to steadily increase our sales, gross profit and net profit despite the adverse market conditions. The construction of the Group?s second production facilities located in Huaian Industrial Zone in Huaian City, Jiangsu Province, was basically completed in September 2015 and trial production was commenced. The Group's production capacity is expected to double after its full operation, reaching 300,000 cubic meters, enabling it to better capitalize on market opportunities."

In addition to a good financial performance, the Group has also strived its utmost to advance the development of environmental protection and new technology. Representing innovative enterprises, Mr. Li Li, Chief Executive Officer of the Group, attended The Fourth Summit of China and Central and Eastern European Countries (1+16 Cooperation) and The China, Central and Eastern European Countries Economic and Trade Forum in 2015. The Group was the only Chinese innovative wood enterprise from a number of candidates across China invited to participate in the 21st United Nations Climate Change Conference and an exhibition held in Paris, demonstrating to the world its efforts and achievements in technological innovation, environmental protection and climate change management. During the conference, the Group signed strategic cooperative agreements with System TM A/S and HOMAG China Golden Field Limited, related to the implementation of "Industry 4.0" and production lines, as well as technologies for high-value utilization and development of tree plantations. The aforementioned agreement facilitates full automation and a high level of efficiency in its production processes, in turn improving the quality of the Group's products to meet international standards. These advances also represent a new means of protecting invaluable natural forest resources by enhancing the scale of fast-growing plantations and increasing their utilization value, as well as sharing of resources.

Strategic Financial Relations Limited
Veron Ng      +852 2864 4831  veron.ng@sprg.com.hk
Angelus Lau   +852 2864 4805  angelus.lau@sprg.com.hk
Antonio Yu    +852 2114 4319  antonio.yu@sprg.com.hk
Fax  +852 2527 1196

Topic: Press release summary
Source: China Wood Optimization (Holding) Limited

Sectors: Daily Finance, Daily News
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