Sales Volume Came to a New Record

On July 24th, Skyworth Digital Holdings Limited publicized their outstanding achievements in the 2005 Fiscal Year (2005.04.01-2006.03.31). Turnover increased by 2.2% to HK$10.7 billion compared with HK$10.5 billion in the prior year. A profit after taxation of HK$216 million for the year ended 31 March 2006, represents a 7% return on the shareholders' funds of HK$3,088 million as at the fiscal year. Gross profit increased by 26.5% to HK$2,005 million. Basic earnings per share was HK$9.53 cents. The Board is recommending a final dividend of HK$2.8 cents, making a total dividend of HK$3.8 cents. Skyworth has kept a brilliant achievement for five years in the electronics industry.

The sales volume in China has come to HK$9.2 billion, rising 3.5%, taking up 86.2% of its whole sales volume. In a recent research conducted by GFK Asia Pte Ltd, in the fiscal year 2005/06, the Group's market share in terms of sales amount and sales quantity were ranking No. 1 with 11.11% and ranking No. 3 with 14.13% respectively. Among these, the sales volume of the high-end color TV products increased 360%，and overall gross margin increases 3% to 19.6%. The overseas sales volume takes up 13.4%, spreading Europe, Middle East, Africa, etc. Besides, the sales of digital set-top box amounted to HK$189 million, rising 100% than in the last year.
 
Mr Zhang Xuebin, the CEO of Skyworth Digital Holdings Limited, explained that Skyworth had made a great achievement in the present severe competition, and he analysed the following reasons:

1. Skyworth has strengthened their technology innovation, which has increased the added value for the products. Skyworth has also obtained the award title of “First Prize of Science & Technology” in Guangdong. Besides, the new technology of "Six-Color Digital" which not only improved the clarity, colour and acoustics of our TV products, but also has made a great contribution to strengthen our marketshare.

2. The revamp of Skyworth corporate logo has made great progress, and promoted the sales. In a year, the worth of our brand has increased RMB2.7 billion, and became one of the enterprises which grows most rapidly in the electronics industry. From endowing RMB10 million to build GuangCai Hope Primary School，to "Feeling of Skyworth Trip of Culture", etc. It empowered and strengthened the appetency and reputation of Skyworth. The three years' Skywroth Project to give bright for people who live in western has made 1002 children with Cataract back to bright. These charity activities not only created a well ground for Skyworth to repaid to our society, but also paid a good will for our branding.

3. The enterprise management has been promoted greatly, and this has made a stable foundation for our outstanding achievement. A number of management tools, like KPI、TPM、SAP、POM play an important role in management, and promoted the standardization and the ability to deal with emergency. It is analyzed that Skyworth has got such an outstanding achievement for five years without any debt. Besides, the business performance promoted greatly when comparing with 2004.

Skyworth is dedicated in making further development in 2006:
- For the completion of Shenzhen Shiyan Lake and Inner Mongolia factory sites, they can produce over 11 million sets annually, resolved the bottleneck in production ability, as well as improved the production speed and lowered the cost of goods flow.

- Since 1st of January, Skyworth Mobile first came into the market with its sales volume has kept at 100,000 units per month, and has become the second major product in Skyworth. It will be a potential product in Skyworth. Besides, Digital Set Top Box and others take greater and greater position in their market.

- As the major product, Skyworth Color TV will positively seek to be one of the mainstreams of the world industry chain.  This year, another 500 college graduate students joined Skyworth, they become the new blood and project a brighter future of Skyworth.