Winson Announces 2018-19 Third Quarter Results

Product name:Winson Announces 2018-19

2019/02/12 update

Industry:Daily News

Further Penetrates its Key Markets and Bolsters Market Position

HONG KONG, Feb 11, 2019 - (ACN Newswire) - Winson Holdings Hong Kong Limited ("Winson" or the "Group"; stock code: 8421), a Hong Kong-based service provider specialising in environmental hygiene and related services and airline catering support services, has announced its unaudited quarterly results for the nine months ended 31 December 2018 ("Period under Review").

During the Period under Review, the Group's two principal businesses of environmental hygiene and related services and airline catering support services performed steadily. The two segments generated combined revenue of approximately HK$135.1 million for the three months ended 31 December 2018 and approximately HK$399.8 million for the Period under Review. This represented an increase of approximately 4.8% and approximately 6.0% from approximately HK$128.9 million and approximately HK$377.1 million recorded for the corresponding periods last year. Gross profit stood at approximately HK$20.2 million for the three months ended 31 December 2018 and approximately HK$58.4 million for the Period under Review, representing period-on-period increases of approximately 5.2% and approximately 3.2% from approximately HK$19.2 million and approximately HK$56.6 million respectively for the corresponding periods last year. Also, the Group had cash and cash equivalents totalling approximately HK$36.7 million as at 31 December 2018.

Over the past nine months, the Group has been able to win 9 new contracts and renewed 49 contracts with its customers. Such achievements highlight the Group's prominence, and more importantly, its ability to deliver services preferred by its many well established customers. For the Period under Review, the Group obtained renewed contracts of contract value in aggregate of approximately HK$428.5 million and new contracts of contract value in aggregate of approximately HK$68.1 million. As at 31 December 2018, the Group had contracts of contract value in aggregate of approximately HK$1,108.9 million on hand, of which contract value of ongoing contracts was approximately HK$743.9 million.

Business Review

Environmental Hygiene and Related Services
The environmental hygiene and related services segment has made strides in sustaining business growth, despite intense competition. For the three months ended 31 December 2018 and the Period under Review, this business segment contributed revenue of approximately HK$125.8 million and approximately HK$370.2 million respectively, representing period-on-period increases of approximately 6.0% and approximately 6.8% from approximately HK$118.7 million and approximately HK$346.7 million respectively for the corresponding periods last year. Gross profit realised upturns as well, reaching approximately HK$19.1 million for the three months ended 31 December 2018 and approximately HK$55.0 million for the Period under Review, representing increases of approximately 6.1% and approximately 3.4% from approximately HK$18.0 million and approximately HK$53.2 million respectively over the same periods last year. For the Period under Review, the Group had renewed 49 environmental hygiene and related services contracts with an aggregate contract value of approximately HK$428.5 million, and encouragingly had won 9 new contracts with an aggregate contract value of approximately HK$68.1 million. As at 31 December 2018, the Group had environmental hygiene and related services contracts of contract value in aggregate of approximately HK$1,064 million on hand, approximately HK$725.7 million of which being ongoing contracts.

Airline Catering Support Services
The airline catering support services business has continued to provide a steady source of revenue to the Group. For the three months ended 31 December 2018 and the Period under Review, this business segment contributed revenue of approximately HK$9.3 million and approximately HK$29.6 million respectively, representing decreases of approximately 8.8% and approximately 2.6% over the corresponding periods of 2017. Gross profit amounted to approximately HK$1.1 million and approximately HK$3.4 million for the three months ended 31 December 2018 and the Period under Review respectively, representing period-on-period decline of approximately 8.3% from approximately HK$1.2 million for the three months ended 31 December 2018 and unchanged when compared with the corresponding periods of 2017. The declines in revenue and profit were due mainly to the computerisation and mechanisation of newly deployed equipment by one of the Group's clients, resulting in lower demand for its services. The segment nonetheless has approximately HK$44.9 million in contracts on hand of which approximately HK$18.2 million represents ongoing contracts.

Prospects

The trade war between the Unites States and China that erupted in July 2018 has resulted in less balanced global economic growth and the erosion of consumer confidence. According to the World Bank, "global growth is expected to decelerate over the next two years as global slack dissipates, major central banks remove policy accommodation, and the recovery in commodity exporters matures". Despite greater risk on the horizon, the environmental hygiene and related services and airline catering support services operations are expected to continue delivering stable metrics in the fourth quarter of 2018. Irrespective of how market conditions develop, the Group will continue to implement its two-pronged strategy of business development and business optimisation. Hence, it will continue to strengthen ties with its many longstanding customers while at the same time seek new customers that are able to benefit from the Group's areas of expertise. It will also look at ways to apply such expertise to new business opportunities, and thereby creating additional revenue streams.

Madam Ng Sing Mui, Chairperson and Executive Director of Winson, said, "Through the two-pronged strategy of business development and business optimization, the Group remains confident that both the environmental hygiene and related services and airline catering support services businesses will continue making steps forward, while at the same time raising the Group's prominence."

About Winson Holdings Hong Kong Limited (Stock code: 8421)
Winson Holdings Hong Kong Limited is a Hong Kong-based service provider specialising in environmental hygiene and related services and airline catering support services in Hong Kong. The Group started off as an environmental hygiene and related service provider in 1983 via the incorporation of Winson Cleaning. In 1993, the Group set up Winson Pest Control as a separate pest management service provider. To diversify the Group's business, the Group has commenced the provision of airline catering support services since 2013.

For media enquiries, please contact:
Strategic Financial Relations Limited
Vicky Lee Tel: (852) 2864 4834 Email: vicky.lee@sprg.com.hk
Jacky Chiu Tel: (852) 2114 4313 Email: jacky.chiu@sprg.com.hk
Emma Zhong Tel: (852) 2864 4858 Email: emma.zhong@sprg.com.hk
Website: www.sprg.com.hk



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