Valuetronics plans to pay a total interim dividend of 8 cents

Valuetronics Holdings has reported revenue of HK$862.1 million, down 3.3% y-o-y, no thanks to lower volume from its consumer electronics segment.

Even though, earnings in the same period increased by 10.2% y-o-y to HK$90.5 million, thanks to lower material costs and a more profitable sales mix which led to better gross margins.

In addition, higher interest rates allowed Velutronics to earn higher interest income.

As at Sept 30, the company remains debt-free and has maintained cash and equivalents at HK$1.17 billion, contributing to a net asset value of HK$3.5 per share.

The company says that the better earnings in the face of lower revenue is a mark of the success of its new strategic focus and winning over a key new customer that can help generate better margins, says chairman and managing director Ricky Tse Chong Hing.

"Notably, there was encouraging revenue contribution from our new Canada-based ICE customer that we acquired in FY2024," he adds.

"Together with other new customers acquired in the past two years, these revenue streams offset reduced demand from a CE customer that is focused on traditional consumer lifestyle products," says Tse.

The company plans to pay an interim dividend and a special dividend of four cents each. The eight cents in total is equivalent to a payout ratio of 36% for 1HFY2025.

Valuetronics closed at 64 cents on Nov 12, up 1.6% for the day.