GP Batteries Announces Its Interim Results
Turnover Up 13.6% Profit Up 9.6%
17 December 1998, Singapore - Mainboard listed GP Batteries International Limited ("GP Batteries"), is pleased to announce today its unaudited consolidated results for the six months ended 30 September 1998.
Summary of Results
Despite a challenging period, GP Batteries' turnover rose by 13.6% to S$234.7 million and the unaudited consolidated net profit after taxation and minority interests increased by 9.6% to S$17.2 million when compared to the previous corresponding period.
Earnings per share for the period based on the weighted average of 103,452,829 (1997:89,595,222) shares in issue amounted to 16.64 Singapore cents, compared with 17.53 Singapore cents for the previous corresponding period.
Business Review
The general business condition during the period has been difficult and highly competitive. The fluctuation in Asian currencies, especially the Japanese Yen put further pressure to the price competition in the global battery markets.
GP Batteries' sales to battery companies in the U.S. continued to register healthy growth. The Asian markets remained steady.
In August 1998, GP Batteries decided to relocate its Lithium-ion battery operations from the U.S. to Taiwan to capitalise on the lower-cost manufacturing and its proximity to portable computer and other electronic equipment manufacturers in Asia.
In October 1998, GP Batteries entered into an agreement with China Development Corporation ("CDC") of Taiwan whereby CDC invested approximately US$10.6 million, equivalent to approximately 16% interest in GP Batteries' Lithium-ion operations, enhancing GP Batteries' market position in Taiwan.
Prospects
The overall business outlook is uncertain and keen price competition is expected to continue. GP Batteries will continue to improve costs by productivity enhancement and rationalisation of its various operations.
GP Batteries' supply to the battery companies under private labels is expected to remain healthy as they continue to increase their out-sourcing in Asia. The operation of the Lithium-ion factory in Taiwan is expected to commence in the next financial year. This will broaden GP Batteries' product range and customer base in the long run.
Barring unforeseen circumstances, the Directors of GP Batteries expect GP Batteries to achieve profitable results in the current fiscal year.
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