Extracted from Annual Report 2019
For the year in review, the Group's revenue rose 35.5%, from RMB653.5 million in FY2018 to RMB885.4 million in FY2019. This came on the back of robust demand for medium, large and mega size tower cranes in Singapore and the PRC, following greater adoption of Prefabricated Prefinished Volumetric Construction ("PPVC") and prefabricated construction. Further breaking down our revenue performance for the year, three out of our four sales regions registered higher sales as compared to FY2018. We saw considerable boosts in demand in three sales regions - the PRC: 45.1% increase, Asia (outside the PRC): 33.3% increase, and Middle East & Others: 36.7% increase. In contrast, demand in USA & Europe, our smallest sales region which comprised 1.3% of sales in FY2019 was relatively muted.
In line with favourable sales for the year in review, the Group's gross profit also rose a substantial 26.0% to RMB238.7 million over a gross profit of RMB189.5 million in FY2018.
However, average gross profit margin decreased to 27.0% in FY2019 from 29.0% in FY2018 amidst keen price competition in the sales of tower cranes, coupled with higher steel material cost. Despite higher proportion of big and mega size tower cranes which generate higher margin were being sold during the year, average margin remained lower.
Other income increased by RMB5.8 million to RMB9.1 million in FY2019 as compared to RMB3.3 million in FY2018. This was mainly due to a RMB3.3 million increase in higher rental income, a RMB1.9 million increase in PRC government grants and a RMB1.0 million increase in higher compensation income.
After factoring in the above, net profit attributable to shareholders for FY2019 amounted to RMB61.5 million, as compared to RMB27.6 million In FY2018.
Ascending the Path of Technological Advancement
Our mantra of high-grade innovation continues to guide our path forward. It was through this approach that we pressed forward to develop and release the aforementioned STT3930, as well as proprietary technologies that include our patented "trapezoidal arm" ("平头塔式起重机梯形臂架"),"luffing tightrope" ("塔 式起重机变幅紧绳装置") and "pin extraction" ("塔式起重 机拔销器") features.
Beyond these technical advancements, the embracing of digitalisation also wields the potential for greater yields in safety, efficiency and capabilities. Today, Computer-Aided Design (CAD) workflows and Product Data Management (PDM) systems have been fully adopted at our plants, shortening product development cycles and enhancing synergy across our various departments. Jointly with our business partner, we are currently working on developing a Smart Crane System ("塔机智能化系 统"). This system will incorporate microchips, sensors, cameras and satellite tracking to empower operators with a host of crane-controlling applications. Once developed, it will allow user access to a multitude of parameters, such as load weight and crane height, enhancing safety and enabling the operator with a clear overview of the crane's working conditions and speedier, more accurate diagnostics to resolve issues. These features can even be accessed remotely, bridging the distance and turnaround time between the crane operator and the technical support team.
Complemented with an extensive marketing, distribution and servicing network, these technological strides allow our products and brand name to stand out and flourish in a competitive industry.
Testaments to Our Successes
In addition to a stronger financial performance, we continued to uphold our brand strength by clinching the following rankings, awards and certifications under the year in review:
As one of the earliest Chinese tower crane manufacturers to export to Europe and the US, we have always afforded extensive efforts towards meeting the requirements of the CE mark. Our R&D, marketing and quality assurance departments regularly go all out to meet the stringent demands of the rigorous certification process, and the well-earned CE marks attained are not just a badge of honour - they signify the confidence entrusted to us as experts in our field, and also pave the way to a wider export market for our products.
In the upcoming financial year, a more extensive focus will be placed on marketing and developing our prefabricated construction and PPVC offerings. The recently minted STT3930 has been delivered to a key player in the domestic infrastructure construction scene, and we are optimistic for further opportunities to further demonstrate our capabilities and expand our repertoire of wide-scale projects. I look forward to another fruitful year of growth and working together with our team to further enhance shareholder value.
Tian Ruo Nan
Chief Executive Officer