Managing Director's Report for the 4th Quarter and Year 2006
February 23, 2007
Managing Director's Report
Operating Results for the 4th Quarter and Year 2006
SVI posted highest quarterly revenue for the 4th Quarter 2006 at USD 40 Million or Baht 1,459 Million, 52.5% higher than the same quarter last year and an increase of 4.4% as compared to the previous Quarter this year, in term of USD. Total year revenue was USD 135 Million or Baht 5,104 Million, compared with last year at USD 110 Million or Baht 4,398 Million, an increase of 22.7%. The revenue growth in "Baht" was 16% as compared with last year, due to strengthen of Baht, 6% year on year (Average 2005: Baht 40.10 vs Average 2006 : Baht 37.71 / USD 1). The revenue growth was driven by new customers that started the business with the company since last year. The demand for Industrial products continues to be strong.
Total Gross Profit for the 4th.quarter 2006 was Baht 158 Million or 10.8% of revenue, higher than the same quarter last year by Baht 41 Million. Total year gross Profit was Baht 498 Million, higher than last year by Baht 89 Million. This was due to higher revenue and better fixed overhead costs utilization. In year 2006, the material cost was higher than previous year due to the strengthen of Baht, resulted by the conversion rate of USD to Baht upon receiving of imported materials higher than the conversion rate upon recognizing of revenue. There was no significant difference of the company's and consolidation's result because Tianjin's plant was not operating in full capacity.
Net Profit for the 4th.Quarter 2006 of Baht 87 Million, similar to 4th Quarter 2005.Total year net Profit was achieved at Baht 294.6 Million, an increase of Baht 38 Million from previous year, an improvement of 15%. This was mainly resulted from higher revenue. The losses generated by subsidiaries for this year was Baht 29.6 Millions as a result of lower revenue during the qualification of Tianjin factory.
Selling and Administrative expenses of the company and consolidated expenses for this quarter were Baht 74 Million and Baht 78 Million or 5% of revenue, higher than the same period of last year by Baht 30 Millions. Total year expenses of the company were Baht 222 Million, and consolidated expenses were Baht 242 Million, compared to last year expenses at Baht 193 Million. The increase was mainly a result of additional personnel to support new product and business development team, and the reserve of obsolescence materials.
Profit & Loss Comparison Table- 2006 vs 2005
|
Unit : "Mil" Baht |
Consolidated
|
The Company |
% | ||
|
2006 (a) |
2005 (b) |
2006 (c) = (a)-(b) |
2005 (d) |
Variance | |
| Net Sales |
5,104 |
4,398 |
5,137 |
4,398 |
16% |
| Total Costs of Sales |
4,611 |
3,990 |
4,640 |
3,991 |
-16% |
| Gross Profit |
493 |
408 |
497 |
407 |
20% |
| Total Operating Expenses |
(237) |
(192) |
(221) |
(187) |
23% |
| Operating Profit |
256 |
216 |
276 |
220 |
19% |
| Interest Income (Expense) |
(8) |
(6) |
(8) |
(6) |
(33%) |
| Exchange Gain (Losses) |
20 |
19 |
20 |
19 |
5% |
| Gain (Losses) from subsidiaries |
0 |
0 |
(30) |
(4) |
|
| Other Non-Operation Income (Expense) |
35 |
39 |
45 |
39 |
(10)% |
| Net Income Before Tax |
303 |
268 |
303 |
268 |
13% |
| Corporation Tax |
(8) |
(11) |
(8) |
(11) |
(27)% |
| Net Income after Tax |
295 |
257 |
295 |
257 |
15% |
Comparison of year end 2006 balance sheet with year end 2005 as follow:
| Unit : In"Million" Baht |
Consolidated |
The Company | ||
|
2006(a) |
2005 (b) |
2006 (c) |
2005 (d) | |
| Current Assets | ||||
| Cash and current investment |
38 |
301 |
31 |
282 |
| Accounts Receivable |
1,079 |
764 |
1,071 |
764 |
| AR - Subsidiaries |
0 |
0 |
61 |
0 |
| Inventories |
1,295 |
940 |
1,259 |
940 |
| Other Current Assets |
26 |
26 |
24 |
27 |
| Total Current Assets |
2,438 |
2,031 |
2,446 |
2,013 |
| Current Liabilities | ||||
| Short term loans |
67 |
0 |
67 |
0 |
| Accounts Payable |
768 |
565 |
766 |
567 |
| AP - Subsidiaries |
0 |
2 |
||
| Other Current Liabilities /Accruals |
114 |
139 |
138 |
138 |
| Total Current Liabilities |
949 |
704 |
973 |
705 |
| Working Capital |
1,489 |
1,327 |
1,473 |
1,308 |
| Property, Plant, Equipment and other assets |
688 |
657 |
704 |
676 |
| Total Net Assets |
2,177 |
1,984 |
2,177 |
1,984 |
| Financed by : | ||||
| Long-term Debt |
21 |
73 |
21 |
73 |
| Net equity |
2,156 |
1,911 |
2,156 |
1,911 |
| Total Long-term Financed |
2,177 |
1,984 |
2,177 |
1,984 |
The Company financial status as of 31 December 2006 showed total assets of Baht 3,150 Millions. This represented an increase of Baht 460 Millions as compared to 31st December 2005, due to an increase of inventory of Baht 319 Millions and an increase of account receivable of Baht 307 Millions. This was mainly due to the increase of revenue and the purchase of materials to support the revenue next quarter.
The company has provided loan to subsidiaries, Globe Vision Corp., in the amount of Baht 59 Million, an increase of Baht 23 Baht from the end of last year, mainly to support the investment in China subsidiaries in Hong Kong for investment in Tianjin subsequently.
Total liabilities were recorded at Baht 994 Millions, an increase of Baht 215 Millions from 31st December 2005. This was mainly due to an increase of Trade Payable of 199 Million related to purchase of additional materials and short term loan in the amount of Baht 20 Million, partially offset with the decrease of long term loan of Baht 58 Million, due to the payment made this year.
Shareholder's equity as of the end 2006 was Baht 2,156 Millions, Baht 245 Millions or 13% higher than that of the end of last year. This was mainly due to an increase in retained earnings derived from profit of Baht 295 Million this year and partially offset with the payment of dividend of Baht 72 Million earlier this year.
_____________________
Mr. Pongsak Lothongkam
Managing Director
