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SCMP Reporter

LAMEX Holdings, a listed furniture maker, has made profits of $69.49 million in the year to April 30, up 15.6 per cent on the previous year.

  The figures were boosted by a $23.17 million exceptional item from the sale of leased properties and a subsidiary.

  Turnover was $798.9 million, against $648.98 million a year earlier, a jump of 23.1 per cent.

  Earnings per share rose to 24.8 cents from 22.6 cents.

  A dividend of 3.7 cents a share was declared, compared with 9.1 cents previously.

  Chairman Clement Lam Ching-wah said margins had been eroded because of heavy investment and keen competition in core markets.

  'During the past year, it is encouraging that Lamex has continued to achieve satisfactory growth in turnover of $150 million in various markets even though the local market conditions are sluggish and the mainland market continues to be affected by austerity measures imposed by the Chinese Government,' he said.

  'The decrease in operating profit was mainly due to the keen competition in the industry and the group's significant investments in its operations to strengthen and expand its production, marketing and administrative infrastructure.'   Mr Lam said he was confident the downturn in profitability was a temporary phenomenon.

  'These investments are building a strong foundation for the group's long-term growth,' he said. The group opened five showrooms in Hong Kong and China in the past year.

  Lamex was testing and sourcing new products aimed at the mainland market, Mr Lam said. A joint venture was formed by the firm, leading to the opening of a showroom in Shanghai this month.

  Expansion is expected in the group's carpet tiles and building materials division following the injection of $37 million from the Sun Hung Kai China Development Fund.

  The injection came in the form of subscription to a 34 per cent stake in a subsidiary.

  'In the coming year, more resources will be allocated to our product development division to improve and upgrade existing products and develop and manufacture new product ranges and to test and identify components which can be produced by our own factory,' Mr Lam said.



Lamex earnings boosted by sale of assets